South African Development Community (SADC) Model BIT (2012)
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A joint decision of the State Parties, each acting through its representative designated for purposes of this Article, declaring their joint interpretation of a provision of this Agreement, shall be binding on any tribunal, and any decision or award issued by a tribunal must apply and be consistent with that joint decision.

This provision was also used first in the NAFTA agreement and is present in the U.S. and Canadian Model BITs and treaties derived from them. A very recent UNCTAD report recommends the inclusion of such provisions today. The parties to NAFTA have in fact issued such an interpretative statement to restrict the broad interpretation of FET by arbitration tribunals ruling under that treaty.
This is a highly recommended provision as it is the only effective safety valve to preclude unintended interpretations being binding on the parties over the longer term. Implementing this provision is a much simpler and more direct process than amending the treaty, making it a very functional process.

Article 31. Governing Law In Dispute Settlement

31.1. When a claim is submitted to a tribunal under this Agreement, it shall be decided in accordance with this Agreement. The governing law for the interpretation of this Agreement shall be this Agreement and the general principles of international law relating to the interpretation of treaties, including the presumption of consistency between international treaties to which the State Parties are party. For matters related to domestic law, the national law of the Host State shall be resorted to as the governing law.

31.2. For greater certainty, paragraph 31.1 does not expand or alter the scope of obligations contained in this Agreement or incorporate other standards except where specifically expressed herein.

The identification of the governing law in an agreement is increasingly important. The above provision ensures a broad purposive approach to the interpretation and application of the Agreement and again mitigates against the ability of a tribunal to focus only on the investor protection provisions as the basis of an interpretative exercise.
The text also limits the role of the governing law clause to the interpretation of the treaty and precludes the addition of new obligations from other parts of international law.

Article 32. Service of Documents

Delivery of Notices and other Documents on a State Party Shall Be Made to the Place Named for ThatState Party In Schedule C.

This is a simple technical provision that clearly identifies the appropriate contact points in the event of a dispute under this Agreement.

Part 6. Final Provisions

Article 33. Entry Into Force

This Agreement shall be subject to ratification by the State Parties in accordance with their constitutional procedures. It shall enter into force 60 days after the deposit by the last State Party of its instrument of ratification with the other Party.

This is a simple clause on entry into force. This is a key technical legal provision required to ensure clarity on when the obligations on the parties become legally binding.

Article 34. Period In Force and Termination

34.1. the Agreement Shall Remain In Force for Ten Years Following Its Entry Into Force.

34.2. Option 1 This Agreement shall be renewed for further periods of ten years following the exchange of official instruments between each State Party confirming the renewal of the Agreement. The notices of renewal shall be exchanged prior to the expiration of the Agreement. This Agreement shall expire where no such exchange of instruments is completed prior to the expiration of each ten- year period.

34.2. Option 2: This Agreement shall automatically be renewed for an additional period of ten years, unless either State Party has submitted a Notice of Intent to terminate the Agreement at the expiration of the current ten-year period at least six months prior to the renewal date.

34.3. Either State Party may terminate this Agreement by giving an official notice to the other Party twelve months prior to its intended termination date, notwithstanding any prior renewal of this Agreement.

34.4. The rights of Investors and the State Parties shall continue in force for [five][ten] years following the expiration of the period in force for investments made during the period the Agreement was in force.

Many existing investment treaties have minimal provisions on the minimum period for which the treaty will be in force and provisions for its renewal or for the withdrawal of a Party. This leaves the Parties free to rely upon rules from outside the treaty, in particular the Vienna Convention on the Law of Treaties, to determine these issues. The view of the Drafting Committee was that the Model Agreement should contain the needed rules on this issue.
The initial period for which the treaty would be in force is ten years. Afterwards, two options are set out. One is a requirement for the Parties to exchange letters of intent to renew the treaty. A failure of either Party to do so means the treaty would then lapse. The second option is the opposite: the treaty renews automatically at the end of ten years for a further ten years, indefinitely, unless either Party notifies the other of its wish to not have the treaty renew itself. There is no legal difference in the end result, but Option 1 requires the positive acts of renewal, while Option 2 requires steps to avoid the automatic renewal. The Drafting Committee felt it was prudent to include both of the options.
In addition, the text provides a mechanism for either Party to terminate the treaty upon 12 months notice to the other Party. This provides an additional safety valve for the Parties in the event of significant difficulties being experienced, significant differences in interpretation or application of the treaty, or other policy reasons a State may have to terminate the treaty. This specific rule would replace general rules under the Vienna Convention.
Finally, it is common for investment treaties to provide for a period of continued application of the treaty in favour of investors of the other State Party made prior to the termination of the treaty. In some instances, treaties have extended this period to between 20 and 30 years. In other instances, the period has been 10 years. The shorter period is adopted here, with an additional option to adopt only a 5-year time period. The Drafting Committee was Unanimously of the view that the time period should be kept at the shorter end.

Article 35. Amendment

This Agreement may be amended by the mutual consent of the State Parties through an exchange of notes or signing of an amendment agreement. An amendment shall enter into force 60 days following the deposit by the last State Party of its instrument of ratification of the amendment with the other Party.

Again, many investment treaties do not include provisions on amendment of the treaty. This is virtually unique to investment treaties, given that almost all other types of treaties do include such provisions. The language above allows easy adaptation to the form of treaty making and amendment that is used in different States. If this provision is not included, the amendment process would be defined by the Vienna Convention instead.

Article 36. Schedules and Notes Part of Treaty

 The Schedules and Notes to this Agreement Form an Integral Part of this Agreement.Commentary

This is a common article. It simply ensures that all of the elements of the negotiated text are considered in the event of any dispute. It is common for important elements to be included in schedules or agreed notes of the negotiating parties.

Article 37. Authentic Text

 The Authentic Text of this Agreement Shall Be In [English][and French][and Portuguese].

This is again a common technical element, essential to ensure which languages are the critical texts in the event of a dispute.

SPECIAL NOTE: The following are the suggested schedules, based on the text set out above. The content of each would then be proposed by each negotiating party for itself, and adopted as part of the text by agreement. It is possible that a State may object to some of the proposed inclusions, and this could be subject to negotiation. In practice, many developed States do seek to minimize any such schedules proposed by their developing country negotiating partners, while maximizing the use of them themselves. It is important for negotiators to focus on these details, and for early preparation of these schedules by SADC Member States, in order to achieve a balanced result in the negotiations.

1. SCHEDULE 1 - Excluded/Included Sectors for Investment Liberalization

SCHEDULE 1 - Excluded/Included Sectors for Investment Liberalization, If Applicable

- List of included or excluded sectors, depending on model chosen; and excluded subsectors

- List of excluded non-conforming measures

2. SCHEDULE 2 - Excluded/Included Sectors for Post-Establishment Investor Protections

SCHEDULE 2 - Excluded/Included Sectors for Post-Establishment Investor Protections, If Applicable

- List of excluded sectors (if top-down drafting), or subsectors

- List of excluded non-conforming measures

3. SCHEDULE 3 - List on National Authorities and Contact Points

The Official Contact Point for the purposes of this Agreement shall be: State Party A: State Party B:

The contact points shall be responsible for the exchange of information required under this Agreement.

4. SCHEDULE 4 - Procedure for Amicus Curiae Submissions

1. The person or organization seeking amicus curiae status shall serve the tribunal and all disputing parties with a Petition for leave to file an amicus curiae submission and the planned submission.

The full text of this schedule is sequential, setting out the process as it should move forward. This ensures transparency and efficiency in the amicus process. The first step is the petition for amicus status by the interested person or group, along with the submission they intend to submit.

2. The Petition for leave to file an amicus curiae submission shall:

(a) be made in writing, dated and signed by the person or organization filing the application, and include the address and other contact details of the Petitioner. Counsel may file and represent the person or organization for this purpose;

(b) be no longer than ten typed pages;

(c) describe the Petitioner, including, where relevant, its membership and legal status (e.g., company, trade association or other non-governmental organization), its general objectives, the nature of its activities, and any parent organization (including any organization that directly or indirectly controls the applicant);

(d) disclose whether or not the Petitioner has any affiliation, direct or indirect, with any disputing party;

(e) identify any government, person or organization that has provided any financial or other assistance in preparing the submission;

(f) specify the nature of the interest that the Petitioner has in the arbitration;

(g) identify the specific issues of fact or law in the arbitration that the Petitioner has addressed in its written submission;

(h) explain, by reference to the factors specified in paragraph 4 below, why the tribunal should accept the submission; and

(i) be made in a language of the arbitration or the primary language of the disputing State Party.

This provision ensures transparency by the potential amicus on who is making the Petition and why. Any relationships to either of the litigation parties must be made clear, including organizational or financial. The Petitioner must also indicate the reasons it is making the submission and what its broader interest in the outcome of the arbitration may be. This could be more local in nature, such as specific environmental impacts, or more broadly developed, such as the proper approach to interpreting the treaty due to the impact the approaches may have on other related situations the amicus is concerned with.

The submission filed by an amicus curiae shall:

(a) be dated and signed by the person filing the submission;

(b) be concise, and in no case longer than [50][40] typed pages, including any appendices;

(c) set out a precise statement supporting the amicus curiae's position on the issues; and

(d) only address matters within the scope of the dispute.

This text gives specific direction to the amicus Petitioner on the form, scope and length for the submission itself. The most critical element is that the submission should be legal and not political in nature. This is an important discipline for the Petitioners.

4. The tribunal shall set an appropriate date for the disputing parties to comment on the Petition for leave to file an amicus curiae submission.

This is an important element of ensuring that the arbitrating parties each have ample and fair opportunity to comment on the amicus submissions, ensuring neither side is unequally affected.

5. In determining whether to grant leave to file an amicus curiae submission, the tribunal shall consider, inter alia, the extent to which:

(a) the amicus curiae submission would assist the tribunal in the determination of a factual or legal issue related to the dispute;

(b) the amicus curiae submission would address a matter within the scope of the dispute;

(c) the amicus curiae has a significant interest in the arbitration; and

(d) there is a public interest in the subject-matter of the arbitration.

This is critical guidance that ensures the Petitioner and the tribunal and the arbitrating parties all understand the criteria upon which a decision to admit {or not admit} an amicus submission is to be made.

6. The tribunal shall ensure that:

(a) any amicus curiae submission does not disrupt the proceedings; and

(b) neither disputing party is unduly burdened or unfairly prejudiced by such submissions.

This places the burden on the tribunal to manage its procedure in such a way as to be transparent and equal and fair in its treatment of the arbitrating parties in light of their interests as the primary litigants.

7. The tribunal shall decide whether to grant leave to file an amicus curiae submission. If leave to file is granted, the tribunal shall set an appropriate date for the disputing parties and the non- disputing State Party to respond in writing to the amicus curiae submission.

This is a procedural provision to ensure proper scheduling of the timetable for all parties.

8. A tribunal that grants leave to file an amicus curiae submission is not required to address the submission at any point in the arbitration. The tribunal may request any person or organization making a submission to appear before the tribunal to reply to specific issues or questions concerning the submission.

Again, this is primarily addressed to ensure that the tribunal can efficiently manage its operations.

9. Access to hearings and documents by persons or organizations that file petitions under these procedures shall be governed by the provisions pertaining to public access to hearings and documents under this Agreement[, unless otherwise determined by the tribunal after consultations with the disputing parties].

As public access to arbitrations under the agreement is already permitted, this is a safety provision allowing the tribunal to make adjustments to those rules if that may be useful to manage the procedure properly.

Conclusion

SOUTHERN AFRICAN DEVELOPMENT COMMUNITY

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  • Part   1 COMMON PROVISIONS 1
  • Article   1 Objective 1
  • Article   2 Definitions 1
  • Article   3 Admission of Investments of Investors of the other Party 1
  • Part   2 Investor Rights Post-Establishment 1
  • Article   4 Non-Discrimination 1
  • Article   5 Option 1: Fair and Equitable Treatment 1
  • Article   5 Option 2: Fair Administrative Treatment 1
  • Article   6 Expropriation 1
  • Article   7 Senior Management and Employees 1
  • Article   8 Repatriation of Assets 1
  • Article   9 Protection and Security 2
  • Part   3 Rights and Obligations of Investors and State Parties 2
  • Article   10 Common Obligation Against Corruption 2
  • Article   11 Compliance with Domestic Law 2
  • Article   12 Provision of Information 2
  • Article   13 Environmental and Social Impact Assessment 2
  • Article   14 Environmental Management and Improvement 2
  • Article   15 Minimum Standards for Human Rights, Environment and Labour 2
  • Article   16 Corporate Governance Standards 2
  • Article   17 Investor Liability 2
  • Article   18 Transparency of Contracts and Payments 2
  • Article   19 Relation to Dispute Settlement 2
  • Article   20 Right of States to Regulate 2
  • Article   21 Right to Pursue Development Goals 2
  • Article   22 Obligations of States on Environment and Labour Standards 2
  • Part   4 General Provisions 2
  • Article   23 Cooperation In Promotion 2
  • Article   24 Transparency of Investment Information 2
  • Article   25 Exceptions 2
  • Article   26 Denial of Benefits 2
  • Article   27 Periodic Review of this Agreement 2
  • Part   5 Dispute Settlement 2
  • Article   28 State-State Dispute Settlement 2
  • Article   29 Investor-State Dispute Settlement 3
  • Article   31 Governing Law In Dispute Settlement 4
  • Article   32 Service of Documents 4
  • Part   6 Final Provisions 4
  • Article   33 Entry Into Force 4
  • Article   34 Period In Force and Termination 4
  • Article   35 Amendment 4
  • Article   36 Schedules and Notes Part of Treaty 4
  • Article   37 Authentic Text 4
  • 1  SCHEDULE 1 - Excluded/Included Sectors for Investment Liberalization 4
  • 2  SCHEDULE 2 - Excluded/Included Sectors for Post-Establishment Investor Protections 4
  • 3  SCHEDULE 3 - List on National Authorities and Contact Points 4
  • 4  SCHEDULE 4 - Procedure for Amicus Curiae Submissions 4