Article 16. Interaction with the Private Sector
Recognizing the fundamental role of the private sector, the Parties shall seek to disseminate among the relevant business sectors general information on investing, the regulatory frameworks and business opportunities in the territory of the other Party.
Article 17. Corporate Social Responsibility
The Parties, being mindful of internationally-recognized corporate social responsibility standards, guidelines and principles, including the Organisation for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises, shall endeavour to encourage enterprises doing business in its territory or subject to its jurisdiction to voluntarily include said standards, guidelines and principles.
Article 18. Non-prohibited General Measures
Nothing in this Agreement shall prevent the implementation by either Party of measures it deems necessary in order to:
(a) maintain public order;
(b) protect its own national interests, including its essential security interests;
(c) fulfil its obligations with respect to the maintenance or restoration of international peace and security;
(d) protect human, animal and plant life or health;
(e) protect and preserve the environment, including living and non-living natural resources;
(f) protect national treasures or monuments having artistic, cultural, historical and archaeological value.
Part II. Dispute Settlement
Section A. Settlement of Disputes Concerning the Interpretation or Implementation of this Agreement
Article 19. Procedure for the Settlement of Disputes Concerning the Interpretation or Implementation of this Agreement
1. The Parties will seek to settle any dispute that may arise between them concerning the interpretation or implementation of this Agreement through amicable consultations.
2. If any such dispute cannot be settled as provided for under paragraph 1 within six months of the date one of the Parties requests in writing an amicable solution, the dispute may be submitted to an ad hoc Arbitral Tribunal on the request of either Party. The UNCITRAL Arbitration Rules shall be applicable except as otherwise provided in this Agreement or agreed by the Parties.
3. The arbitration proceedings shall be administered by the PCA, unless the Parties agree otherwise.
4. The Arbitral Tribunal shall take decisions by a majority vote and its award shall be binding. The Parties shall bear the costs of arbitration in equal proportions.
Section B. Settlement of Disputes between a Party and an Investor of the other Party
Article 20. Consultations and Negotiation
1. In case a dispute related to an investment arises, to the extent possible, will be settled amicably through consultation and negotiation which it may include the utilization of non-binding proceedings, such as mediation and conciliation
2. Consultations will be held for a minimum period of five months from the receipt by the respondent of a request for consultations pursuant to paragraph 4 of this Article.
3. Unless otherwise agreed, consultations will be held in the territory of the host Party.
4. The investor seeking consultations will submit a written request for consultation, specifying:
(a) the name and address of the investor and, where the claim is made on behalf of an enterprise, the name, address and place of incorporation of the enterprise;
(b) the provision of this Agreement alleged to ha ve been breached and any other applicable provisions;
(c) the factual and legal basis for the claim;
(d) the relief sought and the approximate amount of damages claimed; and
(e) the evidence proving its condition of investor of the other Party and the existence of an investment.
5. The mediator will be appointed by agreement of the disputing parties. The disputing parties may also request that the Chairman of the ICSID Administrative Council or the Secretary General of the PCA appoint the mediator.
6. In the event of failure by an investor to submit a claim under Article 21 (Submission of a Claim to Arbitration by an investor of a Party on its own behalf or on behalf of an enterprise) within one year from the submission of a request for consultations, the claimant shall be deemed to have withdrawn their request for consultations and shall be barred from submitting a claim under this Section with regard to the same measures. Said period may be extended by mutual agreement.
7. For greater certainty, the commencement of consultations and negotiations under this Article shall not be interpreted as recognition of the jurisdiction of any Arbitral Tribunal which may be constituted at a future time, in accordance with this Section.
Article 21. Submission of a Claim to Arbitration by an Investor of a Party on Its Own Behalf or on Behalf of an Enterprise
1. After at least six months have elapsed from the receipt of a written request for consultations under Article 20 (Consultations and Negotiation), the investor of the other Party:
(a) May submit a claim to arbitration on its own behalf, in accordance with this Section, stating:
(i) that the relevant disputing party has breached an obligation set forth in Part I (Substantive Provisions) with regard to the management, conduct, operation and sale or other form of disposition of an investment; or
(ii) that the claimant has incurred loss or damage by reason of, or arising out of, that breach.
(b) may submit a claim to arbitration on behalf of an enterprise of the respondent with the status of legal person owned by the claimant or directly or indirectly controlled by the claimant, in accordance with this Section, stating:
(i) that the relevant disputing party has breached an obligation set forth in Part I (Substantive Provisions), except for Article 12 (Investment and Environmental, Health and Other Regulatory Objectives) and Article 17 (Corporate Social Responsibility), with regard to the management, conduct, operation and sale or other form of disposition of an investment; or
(ii) that the enterprise has incurred loss or damage by reason of, or arising out of, that breach.
2. Pursuant to the provisions of paragraph 1, the claimant and the respondent may agree to submit their claim to:
(a) an Arbitral Tribunal constituted under the ICSID Convention, provided that both Parties are parties to the ICSID Convention; or
(b) An Arbitral Tribunal constituted under the UNCITRAL Arbitration Rules, which shall be administered by the PCA; or
(c) an ad hoc Arbitral Tribunal.
3. In the event that the claimant and the respondent cannot reach an agreement on one of the above procedures as per paragraph 2 of this Article, either of them may submit the claim to arbitration under the UNCITRAL Arbitration Rules.
4. The applicable arbitration rules shall be: in the case of paragraph 2 (a), the ICSID Convention Arbitration Rules; in the case of paragraph 2 (b ), the UNCITRAL Arbitration Rules; and in the case of paragraph 2 (e), the arbitration rules chosen by the disputing parties by mutual agreement. The applicable rules shall govern the arbitration except to the extent modified in this Section or by agreement of the disputing parties.
5. For greater certainty, a dispute may be settled amicably at any time, including after the claim has been submitted to arbitration under this Article.
6. The investor seeking arbitration will submit a written request for arbitration in accordance with Article 42, specifying:
(a) the name and address of the investor and, where the claim is made on behalf of an enterprise, the name, address and place of incorporation of the enterprise;
(b) the provision of this Agreement alleged to have been breached and any other applicable provisions;
(c) the factual and legal basis for the claim; and
(d) the relief sought and the approximate amount of damages claimed.
(e) The evidence proving its condition of investor of the other Party and the existence of an investment.
7. Notwithstanding paragraph 1 of this Article, no claim may be submitted to arbitration if more than three years have elapsed from the date on which the claimant first acquired,or should have first acquired, knowledge of the breach alleged under paragraph 1.
Article 22. Conditions for the Submission of a Claim to Arbitration
1. Either on its own behalf or representing an enterprise of the respondent with the status of legal person owned by the claimant or directly or indirectly controlled by the claimant, the claimant may only submit a claim to arbitration under this Section provided that:
(a) The claimant consents to submit to arbitration in accordance with the procedures set forth in this Agreement; and
(b) the claimant and the legal person (if the claim refers to a loss or damage of an interest in an enterprise of the other Party with the status of legal person owned by the investor or directly or indirectly controlled by the investor) waive their right to initiate or pursue any proceedings before an administrative or judicial court under the laws of either Party or other dispute settlement mechanisms with regard to the measure taken by a disputing party allegedly in breach of the provisions of Part I (Substantive Provisions).
2. The consent and waiver required under this Article shall be provided in writing, delivered to the respondent, and included in the submission of the claim to arbitration.
Article 23. Consent of Each Party to Arbitration
Each Party consents to submit a claim to arbitration under this Section in accordance with this Agreement.
Article 24. Third Party Funding
Third party funding is not permitted.
Article 25. Number of Arbitrators and Method of Appointment
1. Unless the disputing parties agree otherwise, the Arbitral Tribunal shall comprise three arbitrators, one arbitrator appointed by each of the disputing parties and the third, who shall act as the President of the Arbitral Tribunal, appointed by agreement of the disputing parties.
2. The arbitrators shall have adequate experience in public international law and international investment rules, or in the settlement of disputes arising from international investment agreements. They shall be impartial, independent, and not dependent on either Party or on the claimant or its attorneys, or receive instructions from any of them. The arbitrators shall not participate in the analysis of any dispute which may lead to a direct or indirect conflict of interest. They shall comply with the guidelines set forth in Part II, Section C of this Agreement (Provisions on the Conduct of Arbitrators), in addition to the International Bar Association Guidelines on Conflicts of Interest in International Arbitration, as well as with any supplementary rule on which the disputing parties may agree. Furthermore, at the time of appointment, the arbitrators will refrain from acting as advisers, as party-appointed experts, or as witnesses in any pending dispute on investments or under this Agreement or any other international agreement.
Article 26. Constitution of the Arbitral Tribunal If Either Party Fails to Appoint an Arbitrator or the Disputing Parties Fail to Reach an Agreement on the Appointment of the Chairman of the Tribunal
1. Where either Party fails to appoint an arbitrator or the disputing parties fail to reach an agreement on the appointment of the President of the Arbitral Tribunal, within a period of 90 days from the date on which the claim is submitted to arbitration under this Section, the Tribunal shall be constituted in accordance with the provisions of the applicable Arbitration Rules under Article 21 (Submission of a claim to arbitration by an investor of a Party on its own behalf or on behalf of an enterprise) of this Agreement.
2. Nationals of the respondent and the claimant shall not be appointed as the President of the Arbitral Tribunal unless the disputing parties agree otherwise.
Article 27. Consolidation of Proceedings
1. If two or more claims have been submitted separately to arbitration under Article 21 (Submission of a claim to arbitration by an investor of a Party on its own behalf or on behalf of an enterprise) and the claims raise a question of law or fact in common and arise out of the same events or circumstances, either disputing party may seek a consolidation order in accordance with the agreement of the other disputing party sought to be covered by the order or with the terms of paragraphs 2 to 1O.
2. A disputing party that seeks a consolidation order under this Article shall deliver, in writing, a request to the ICSID Secretary-General or the Secretary General of the PCA, as applicable, and to the other disputing party sought to be covered by the order, and shall specify the following in the request:
(a) the name and address of the disputing party sought to be covered by the consolidation order;
(b) the nature of the consolidation order sought; and
(c) the grounds on which the order is sought.
3. Unless the ICSID Secretary-General or the Secretary General of the PCA, as applicable, finds within a period of 30 days from the date of receipt of a request under paragraph 2 that the request is manifestly unfounded, an Arbitral Tribunal shall be established under this Article.
4. Unless all the disputing parties sought to be covered by the consolidation order agree otherwise, an Arbitral Tribunal established under this Article shall comprise three arbitrators:
(a) one arbitrator appointed by agreement of the claimants;
(b) one arbitrator appointed by the respondent; and
(c) the President of the Arbitral Tribunal appointed by the ICSID Secretary-General or the Secretary General of the PCA, as applicable, provided that the President is not a national of the respondent or of a Party of any claimant.
5. If, within a period of 60 days from the date of receipt by the ICSID Secretary-General or the Secretary General of the PCA, as applicable, of a request made under paragraph 2, the respondent or the claimants fails to appoint an arbitrator in accordance with paragraph 4, the ICSID Secretary-General or the Secretary General of the PCA, as applicable, on request of any disputing party sought to be covered by the order, shall appoint, in his or her discretion, the arbitrator or arbitrators not yet appointed.
6. If an Arbitral Tribunal established under this Article is satisfied that two or more claims that have been submitted to arbitration under Article 21.1 (Submission of a claim to arbitration by an investor of a Party on its own behalf or on behalf of an enterprise) have a question of law or fact in common, and arise out of the same events or circumstances, the Arbitral Tribunal may, in the interest of fair and efficient resolution of the claims, and after hearing the disputing parties, by order:
(a) assume jurisdiction over, and hear and determine together, all or part of the claims;
(b) assume jurisdiction over, and hear and determine one or more of the claims, the determination of which it believes would assist in the resolution of the others; or
(c) instruct an Arbitral Tribunal previously constituted under Article 25 (Number of Arbitrators and Method of Appointment) to assume jurisdiction over, and hear and determine together, all or part of the claims, provided that:
(i) the latter Arbitral Tribunal, on request of a claimant that was not previously a disputing party before that Arbitral Tribunal, shall be reconstituted with its original members, except that the arbitrator for the claimants shall be appointed pursuant to paragraphs 4 (a) and 5; and
(ii) the latter Arbitral Tribunal shall decide whether any previous hearing shall be repeated.
7. If an Arbitral Tribunal has been constituted under this Article, a claimant that has submitted a claim to arbitration under Article 21.1 (Submission of a claim to arbitration by an investor of a Party on its own behalf or on behalf of an enterprise) and that has not been named in a request made under paragraph 2 may make a written request to the Arbitral Tribunal to be included in any order issued under paragraph 6. The request shall specify:
(a) the name and address of the claimant;
(b) the natureb of the consolidation order sought; and
(c) The grounds on which the order is sought.
The claimant shall deliver a copy of their request to the Secretary-General of ICSID or the Secretary-General of the PCA, as appropriate.
8. An Arbitral Tribunal established under this Article shall conduct its proceedings in accordance with the UNCITRAL Arbitration Rules, except as modified by this Section.
9. An Arbitral Tribunal constituted under Article 25 (Number of Arbitrators and Method of Appointment) shall not have jurisdiction to decide on a claim, or part of a claim, over which an Arbitral Tribunal constituted or instructed under this Article has assumed jurisdiction, without prejudice to paragraph 6 (c).
10. At the request of a disputing party, an Arbitral Tribunal constituted under this Article, pending its decision under paragraph 6, may order that the proceedings of an Arbitral Tribunal constituted under Article 25 (Number of Arbitrators and Method of Appointment) be stayed, unless the latter Arbitral Tribunal has already adjourned its proceedings.
Article 28. Preliminary Objections
1. Any objection that the dispute is not within the jurisdiction or competence of the Arbitral Tribunal, is inadmissible, or manifestly lacks legal basis, shall be made as early as possible. A disputing party shall file the objection with the Arbitral Tribunal no later than the expiration of the time limit fixed for the filing of the counter-memorial.
2. The Arbitral Tribunal may on its own initiative consider, at any stage of the proceeding, whether the dispute before it is within its jurisdiction or competence.
3. Upon the formal raising of an objection relating to the dispute, the Arbitral Tribunal decides to suspend the proceeding on the merits. The President of the Arbitral Tribunal, after consultation with its other members, shall fix a time limit within which the disputing parties may file observations on the objection.
4. The Arbitral Tribunal shall decide whether or not the further procedures relating to the objection made pursuant to paragraph 1 shall be oral. If the Arbitral Tribunal overrules the objection or joins it to the merits, it shall once more fix time limits for the further procedures. Upon submission of its counter-memorial, or at a later stage of the proceedings, if the Arbitral Tribunal decides that, under the circumstances, the delay is justified, the respondent may submit a counter-claim directly related with the dispute, provided that the disputing party shall specify precisely the basis for the counter-claim.
5. If the Arbitral Tribunal decides that the dispute is not within its jurisdiction or competence, or that all claims are manifestly without legal merit, it shall render an award to that effect.
Article 29. Place of the Arbitration Proceedings
The disputing parties may agree on the legal place of any arbitration under the arbitration rules applicable in accordance with Article 21 (Submission of a claim to arbitration by an investor of a Party on its own behalf or on behalf of an enterprise). If the disputing parties fail to reach an agreement and have chosen not to apply the ICSID Arbitration Rules, the Arbitral Tribunal shall, in accordance with the applicable arbitration rules, determine its seat to be The Hague.
Article 30. Governing Law
1. The Arbitral Tribunal shall decide a dispute in accordance with this Agreement, and shall apply the law of the State Party to the dispute (including its rules on the conflict of laws) and such rules of international law as may be applicable.
2. An interpretation jointly formulated and agreed upon by the State Parties with regard to any provision of this Agreement shall be binding on any Arbitral Tribunal established thereunder.
Article 31. Expert Reports
Without prejudice to the appointment of other kinds of experts when authorized by applicable arbitration rules, the Arbitral Tribunal, on request of a disputing party or, unless the disputing parties disapprove, on its own initiative, may appoint one or more experts to report to it in writing on any factual issue concerning environmental, health, safety or other scientific matters raised by a disputing party in a proceeding, subject to the terms and conditions agreed upon by the disputing parties.
Article 32. Interim Protection Measures
1. An Arbitral Tribunal may, at the request of a disputing party and where the circumstances of the case so require, order an interim measure of protection to preserve the rights of a disputing party, or to ensure that the jurisdiction of the Arbitral Tribunal is made fully effective, including an order to preserve evidence in the possession or control of a disputing party or to protect the jurisdiction of the Arbitral Tribunal.
2. The request must specify the rights to be protected, the measures requested and the circumstances requiring the implementation of such measures. In addition, the disputing party requesting an interim measure must demonstrate the following before the Arbitral Tribunal:
(a) failure to grant the interim measure would probably result in harm which cannot be redressed through the payment of compensation and which is notoriously more serious than the harm that may be inflicted upon the party affected by the interim measure if adopted; and
(b) it is reasonably probable that its claim on the merits will succeed. The decision of the Arbitral Tribunal on such probability will not constitute a prior judgement in connection with any subsequent determination the Arbitral Tribunal may adopt.
3. The Arbitral Tribunal will only issue interim measures, or amend or revoke previously issued measures, after allowing each party to submit its observations.
4. The Arbitral Tribunal may require the disputing party requesting an interim measure to post an appropriate bond with respect to the requested measure.
Article 33. Awards
1. When an Arbitral Tribunal makes a final award, the Arbitral Tribunal may only award, either separately or in combination:
(a) Monetary damages and any applicable interest; and
(b) restitution of property, in which case the award shall provide that the respondent may pay monetary damages and any applicable interest in lieu of restitution. The Arbitral Tribunal may also award legal costs in accordance with this Section and applicable arbitration rules.
2. In accordance with paragraph 1, where the claim is made by an investor on behalf of an enterprise:
(a) an award of restitution of property shall provide that restitution be made to the enterprise;
(b) an award of monetary damages and any applicable interest shall provide that the sum be paid to the enterprise.
3. An Arbitral Tribunal may not order a Party to pay punitive damages.
4. An award issued by an Arbitral Tribunal shall have no binding force except between the disputing parties and only with respect to the particular case.
5. A disputing party shall not seek enforcement of a final award until:
(a) in the case of a final award made under the ICSID Convention:
(i) 120 days have elapsed from the date the award was rendered and no disputing party has requested the revision under Article 51 of the ICSID Convention or annulment of the award under Article 52 of the ICSID Convention; or
(ii) revision or annulment proceedings have been completed; and
(b) in the case of a final award under the UNCITRAL Arbitration Rules;
(i) 90 days have elapsed from the date the award was rendered and no disputing party has requested the revision, revocation or annulment of the award; or
(ii) a court has dismissed or allowed an application to revise, set aside, or annul the award and there is no further appeal.
6. Each Party shall provide for the enforcement of an award in its territory.
7. A claim that is submitted to arbitration under this Section shall be considered to arise out of a commercial relationship or transaction, for the purposes of Article 1 of the New York Convention.
Section C. Provisions on the Conduct of Arbitrators
Article 34. Conduct of Arbitrators
1. The provisions of this Article shall apply to the procedures conducted in accordance with Sections A and B. In the event that the provisions of this Section are not consistent with the International Bar Association Guidelines on Conflicts of Interest in International Arbitration, the former shall prevail.
2. Members of Arbitral Tribunals must be independent and impartial, and must avoid any direct or indirect conflicts of interest. They must also observe the confidentiality of proceedings.
Article 35. Obligations Related to the Disclosure of Data
1. Before accepting their appointment, each arbitrator must disclose the existence of any interest, relationship or matter that could reasonably be expected to be known and affect or raise justifiable doubts as regards the independence or impartiality of the arbitrator, including public statements or personal opinions on issues related to the dispute and any professional relationship with any person or organization that may have any interest in the case.
2. The obligation to disclose data shall be permanent and binds arbitrators to disclose any interest, relationship or matter that may arise during any of the stages of the proceedings.
Article 36. Duties of Arbitrators
1. Upon being appointed, arbitrators must fully and promptly fulfil their obligations during the proceedings. Such duties must be fulfilled fairly and diligently.
2. Arbitrators shall limit their analysis to the issues arising from the proceedings and that are required to issue a decision.
3. Arbitrators may not discuss any aspect of the dispute to be settled with either disputing party in the absence of the other.
Article 37. Independence and Impartiality of Arbitrators
1. Arbitrators shall:
(a) Fulfil their duties without accepting or requesting instructions from any international, governmental or non-governmental institution, or from any private source,
(b) remain independent and unbiased, without being affected by personal interests, political considerations or the public opinion,
(c) avoid starting a relationship or acquiring any financial interest that may affect their impartiality or that may reasonably create an appearance of impartiality.