Article 12. Expropriation and Compensation

1. A Party shall not nationalise or expropriate covered investments of an investor of any other Party, either directly or through measures equivalent to expropriation or nationalisation (referred hereto as "expropriation), except:

(a) for public purpose (15)

(b) in accordance with due process of law;

(c) on a non-discriminatory basis; and

(d) upon payment of prompt, adequate and effective compensation.

2. For the purpose of paragraph 1(d), compensation shall:

(a) be equivalent to the fair market value of the expropriated investment at the time when the expropriation was publicly announced (16), or when the expropriation occurred, whichever is applicable;

(b) not reflect any change in value occurring because the intended expropriation had become known earlier;

(c) be settled and paid without undue delay (17); and

(d) be effectively realisable and freely transferable between the territories of the Parties.

3. The compensation referred to in paragraph 1(d) shall include appropriate interest. The compensation, including any accrued interest, shall be payable either in the currency of the expropriating Party, or if requested by the investor, in a freely usable currency.

4. Notwithstanding paragraphs 1, 2 and 3, in the case of the Republic of Singapore and the Socialist Republic of Viet Nam, any measure of expropriation relating to land shall be as defined in their respective domestic laws, regulations and any amendment thereto and shall be, for the purposes of and upon payment of compensation, in accordance with the aforesaid laws and regulations

5. This Article does not apply to the issuance of compulsory licences granted in relation to intellectual property rights under the TRIPS Agreement.

Article 13. Compensation for Losses

A Party shall accord to investors of any other Party whose covered investment suffered losses due to war or other armed conflict, state of national emergency, civil strife or other similar events in its territory, treatment no less favourable than that accorded, in like circumstances, to its own investors or investors of a non-Party whichever is more favourable, relating to restitution, indemnification, compensation or any other forms of settlement.

Article 14. Subrogation

1. Where a Party or an agency authorised by that Party has granted a contract of insurance or any form of financial guarantee against non-commercial risks with regard to a covered investment by one of its investors in the territory of any other Party and when payment has been made under this contract or financial guarantee by the former Party or the agency authorised by it, the latter Party shall recognise the rights of the former Party or the agency authorised by the Party by virtue of the principle of subrogation to the rights of the investor. (18)

2. Where a Party or the agency authorised by the Party has made a payment to its investor and has taken over rights and claims of the investor, that investor shall not, unless authorised to act on behalf of the Party or the agency authorised by the Party, making the payment, (19) pursue those rights and claims against the other Party.

Article 15. Special Formalities and Treatment of Information

1. Nothing in Article 3 (National Treatment) shall be construed to prevent a Party from adopting or maintaining a measure that prescribes special formalities in connection with the establishment of investments by investors of any other Party, such as the requirement that investments be legally constituted under the laws or regulations of the Party and compliance with registration requirements, provided that such formalities do not materially impair the rights afforded by a Party to investors of any other Party and investments of investors of any other Party pursuant to this Agreement.

2. Notwithstanding Article 3 (National Treatment) or Article 4 (Most-Favoured-Nation Treatment), a Party may require an investor of any other Party, or its investment in its territory, to provide routine information concerning that investment solely for information or statistical purposes. The Party shall protect any confidential information which has been provided from any disclosure that would prejudice legitimate commercial interests of particular juridical persons, public or private or the competitive position of the investor or the investment. Nothing in this paragraph shall be construed to prevent a Party from otherwise obtaining or disclosing information in connection with the equitable and good faith application of its law.

Article 16. Special and Differential Treatment for the New Asean Member Countries

In order to increase benefit for the new ASEAN Member Countries in participating in this Agreement, and in accordance with the objectives set out in the Preamble to this Agreement and in the Framework Agreement, a special and differential treatment shall be accorded to these Countries, to the extent possible, through:

(a) access to information on the investment policies of other Parties, business information, relevant databases and contact point for investment promotion;

(b) technical assistance to strengthen their capacity in relation to investment policies and promotion including in areas such as human resource development;

(c) commitments in areas of interest to the new ASEAN Member Countries; and

(d) recognising that commitments by each new ASEAN Member Country can be made in line with its respective development policies and strategies.

Article 17. Denial of Benefits

1. A Party may deny the benefits of this Agreement to an investor of any other Party that is a juridical person of such other Party and to investments of such investor if the juridical person has no substantial business activities in the territory of the Party under whose law it is constituted or organised, and investors of a non-Party, or of the denying Party, own or control the juridical person.

2. The denying Party shall, to the extent practicable, notify the other Parties concerned before denying the benefits. If the denying Party provides such notice, it shall consult with the other Parties concerned at the request of such other Parties.

3. Notwithstanding paragraph 1, and subject to prior notification to and consultation with the relevant Party, in the case of the Kingdom of Thailand, the Kingdom of Thailand may deny the benefits of this Agreement relating to the admission, establishment, acquisition and expansion of investments to an investor of any other Party that is a juridical person of such other Party and to investments of such an investor where the Kingdom of Thailand establishes that the juridical person is owned or controlled by natural persons or juridical persons of a non-Party.

4. In the case of the Kingdom of Thailand, a juridical person is:

(a) owned by investors of a Party if more than 50 per cent of the equity interest in it is beneficially owned by such investors; and

(b) controlled by investors of a Party if such investors have the power to name a majority of its directors or otherwise to legally direct its actions.

5. Following notification, and without prejudice to paragraph 1, in the case of the Republic of the Philippines, the Republic of the Philippines may deny the benefits of this Agreement to an investor of any other Party and to investments of that investor, where it establishes that such investor has made an investment in breach of the provisions of Commonwealth Act No. 108 (An Act to Punish Acts of Evasion of Laws on the Nationalization of Certain Rights, Franchises or Privileges) as amended by Presidential Decree No. 715, otherwise known as the Anti-Dummy Law", as may be amended.

Article 18. Investment Dispute Settlement between a Party and an Investor of Any other Party

1. This Article shall apply to investment disputes between a Party and an investor of any other Party concerning an alleged breach of Article 3 (National Treatment), Article 4 (Most-Favoured-Nation Treatment), Article 5 (General Treatment of Investment), Article 7 (Senior Management and Boards of Directors), Article 10 (Transfers), Article 12 (Expropriation and Compensation) and Article 13 (Compensation for Losses) of this Agreement which causes loss or damage by reason of, or arising out of, that breach to:

(a) the investor in relation to its covered investments; or

(b) the covered investment that has been made by that investor,

Relating to the management, conduct, operation or sale or other disposition of a covered investment.

2. A natural person possessing the nationality or citizenship of a Party shall not pursue a claim against that Party under this Agreement.

3. An investment may not make a claim under this Article.

4. In the event of an investment dispute arising under this Article, the disputing parties shall as far as possible resolve the dispute through consultation and negotiation, a request of which shall be made in writing, with a view towards reaching an amicable settlement.

5. Any such dispute which has not been resolved within a period of six months from the date of written request for consultations may be submitted to the courts or administrative tribunals of the disputing Party provided that such courts or tribunals have jurisdictions over such claims or to arbitration. In the latter event, the investor has the choice among any of the following:

(a) the ICSID Convention and the ICSID Rules of Procedure for Arbitration Proceedings, provided that both the disputing Party and the nondisputing Party are parties to the ICSID Convention (20).

(b) the ICSID Additional Facility Rules, provided that either the disputing Party or the non-disputing Party is a party to the ICSID Convention;

(c) the UNCITRAL Arbitration Rules; or

(d) any other arbitration institution or any other arbitration rules, if the disputing parties so agree.

6. Once the investor has submitted the dispute to the courts or administrative tribunals of the disputing Party or any of the arbitration mechanisms provided for in paragraph 5, the choice of forum shall be final.

7. The submission of a dispute to arbitration under paragraph 5 shall be conditional upon:

(a) the submission of the dispute to such arbitration taking place within three years of the time at which the disputing investor became aware, or should reasonably have become aware, of a breach of an obligation under this Agreement and, of the loss or damage incurred by the disputing investor in relation to its covered investment or by the covered investment; and

(b) the disputing investor providing written notice, which shall be delivered at least 90 days before the claim to arbitration is submitted, to the disputing Party of its intent to submit the dispute to such arbitration and which:

(i) nominates one of the fora in paragraph 5(a), (b), (c), or (d) as the forum for dispute settlement; and

(ii) briefly summarises the alleged breach of the disputing Party under this Agreement (including the articles alleged to have been breached) and the loss or damage allegedly caused to the investor in relation to its covered investment or caused to the covered investment. (21)

8. Where an investment dispute relate to a measure which may be a taxation measure, the disputing Party and the non-disputing Party, including representatives of their tax administrations, shall hold consultations to determine whether the measure in question is a taxation measure.

9. Where a disputing investor claims that the disputing Party has breached Article 12 (Expropriation and Compensation) by the adoption or enforcement of a taxation measure, the disputing Party and the non-disputing Party shall, upon request from the disputing Party, hold consultations with a view to determining whether the taxation measure in question has an effect equivalent to expropriation or nationalisation.

10. Any tribunal that may be established under this Article shall accord serious consideration to the decision of the disputing Party and the non-disputing Party under paragraphs 8 and 9.

11. If the disputing Party and the non-disputing Party fail either to initiate such consultations referred to in paragraphs 8 and 9, or to make such joint decisions, within the period of 180 days from the date of the receipt of request for consultation referred to in paragraph 4, the disputing investor shall not be prevented from submitting its claim to arbitration in accordance with this Article.

12. A Party shall not prevent the disputing investor from seeking interim measures of protection, not involving the payment of damages or resolution of the substance of the matter in dispute before the courts or administrative tribunals of the disputing Party, prior to the institution of proceedings before any of the dispute settlement fora referred to in paragraph 5, for the preservation of its rights and interests.

13. A Party shall not give diplomatic protection, or bring an international claim, in respect of a dispute which one of its investors and any other Party shall have consented to submit or have submitted to arbitration under this Article, unless such other Party has failed to abide by and comply with the award rendered in such dispute. Diplomatic protection, for

The purposes of this paragraph, shall not include informal diplomatic exchanges for the sole purpose of facilitating a settlement of the dispute.

14. An award made by a tribunal shall be final and binding upon the disputing parties. An award shall have no binding force except between the disputing parties and in respect of the particular case.

Article 19. Disputes between the Parties

Unless otherwise provided in this Agreement, any dispute concerning the interpretation, implementation or application of this Agreement shall be resolved through the procedures and mechanism as set out in the Agreement on Dispute Settlement Mechanism under the Framework Agreement.

Article 20. General Exceptions

1. Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between the Parties or their investors where like conditions prevail, or a disguised restriction on investors or investments made by investors of any other Party, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any Party of measures:

(a) necessary to protect public morals or to maintain public order; (22)

(b) necessary to protect human, animal or plant life or health;

(c) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement including those relating to:

(i) the prevention of deceptive and fraudulent practices to deal with the effects of a default on a contract;

(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts; and

(iii) safety;

(d) inconsistent with Article 3 (National Treatment), provided that the difference in treatment is aimed at ensuring the equitable or effective 23 imposition or collection of direct taxes in respect of investments or investors of any other Party;

(e) imposed for the protection of national treasures of artistic, historic or archaeological value; or

(f) relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption.

2. Insofar as measures affecting the supply of financial seNices are concerned, paragraph 2 (Domestic Regulation) of the Annex on Financial SeNices of the GATS shall be incorporated into and form an integral part of this Agreement, mutatis mutandis.

Article 21. Security Exceptions

1. Nothing in this Agreement shall be construed:

(a) to require a Party to furnish any information, the disclosure of which it considers contrary to its essential security interests; or

(b) to prevent a Party from taking any actions which it considers necessary for the protection of its essential security interests:

(i) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials or relating to the supply of seNices as carried on, directly or indirectly, for the purpose of supplying or provisioning a military establishment;

(ii) taken in time of war or other emergency in domestic or international relations;

(iii) relating to fissionable and fusionable materials or the materials from which they are derived;

(iv) Taken to protect critical public infrastructures, including communication, power and water infrastructures, from deliberate attempts intended to disable or degrade such infrastructures; or

(c) to prevent a Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

2. The Implementing Committee shall be informed to the fullest extent possible of measures taken under paragraphs 1(b) and (c) and of their termination.

Article 22. Taxation

Nothing in this Agreement shall affect the rights and obligations of any Party under any tax agreement to which the Party is a party. In the event of any inconsistency between this Agreement and any such agreement, that agreement shall prevail to the extent of the inconsistency.

Article 23. Relation to other Agreements

1. Nothing in this Agreement shall be construed to derogate from any right or obligation of a Party under international agreements to which the Parties are party.

2. If the international obligations existing at present or established hereafter between the Parties in addition to this Agreement, result in a position entitling investors of any other Party and investments by investors of any other Party to treatment more favourable than is provided for by this Agreement, such position shall not be affected by this Agreement.

Article 24. Institutional Arrangements

The institutions as provided for in Article 5.3 of the Framework Agreement shall oversee, supervise, coordinate and review, as appropriate, the implementation of this Agreement.

Article 25. Consultations

The Parties agree to consult each other at the request of any Party on any matter relating to investments covered by this Agreement, or otherwise affecting the implementation of this Agreement.

Article 26. Review and Future Liberalisation

1. The institutions as provided for in Article 5.3 of the Framework Agreement shall review the implementation of this Agreement.

2. The Parties will, through future negotiations, further deepen liberalisation with a view to reaching the reduction or elimination of the remaining restrictions scheduled in conformity with Article 9 (Reservations), on a mutually advantageous basis and ensuring an overall balance of rights and obligations.

Article 27. Work Programme

1. The Parties shall enter into discussions on:

(a) Article 4 (Most-Favoured-Nation Treatment);

(b) TRIMs-plus elements to Article 6 (Performance Requirements);

(c) Schedules of Reservations to this Agreement;

(d) Procedures for modification of Schedules of Reservations that will apply at the date of entry into force of the Schedules of Reservations to this Agreement;

(e) Annex on Expropriation and Compensation;

(f) Annex on Taxation and Expropriation; and

(g) Article 18 (Investment Dispute Settlement between a Party and an Investor of any other Party).

2. The Parties shall conclude the discussions referred to in paragraph 1, within five years from the date of entry into force of this Agreement unless the Parties otherwise agree.

These discussions shall be overseen by the Implementing Committee established under Article 5.3 of the Framework Agreement.

3. Schedules of Reservations to this Agreement referred to in paragraph 1 shall enter into force on a date agreed to by the Parties.

4. Notwithstanding anything to the contrary in this Agreement, Article 3 (National Treatment), Article 4 (MostFavoured-Nation Treatment), Article 7 (Senior Management and Boards of Directors), Article 9 (Reservations), and in the case of the Lao People's Democratic Republic Article 6 (Performance Requirements), shall not apply until the Parties' Schedules of Reservations to this Agreement have entered into force in accordance with paragraph 3.

Article 28. Annexes and Future Instruments

This Agreement shall include:

(a) the Annexes and the contents therein which shall form an integral part of this Agreement; and

(b) all future legal instruments agreed pursuant to this Agreement.

Article 29. Amendments

The provisions of this Agreement may be modified through amendments mutually agreed upon in writing by the Parties.

Article 30. Depositary

For the ASEAN Member Countries, this Agreement shall be deposited with the Secretary-General of ASEAN, who shall promptly furnish a certified copy thereof, to each ASEAN Member Country.

Article 31. Entry Into Force

1. This Agreement shall enter into force on the first day of the second month following the latter date on which at least one ASEAN Member Country and Korea have notified all the other Parties in writing of the completion of their internal procedures.

2. A Party shall, upon the completion of its internal procedures for the entry into force of this Agreement, notify all the Parties in writing.

3. Where a Party is unable to complete its internal procedures for the entry into force of this Agreement by the date as set out in paragraph 1, this Agreement shall come into force for that Party, 30 days after the date on which that Party has notified all the other Parties in writing of the completion of its intemal procedures. The Party concerned, however, shall be bound by the same terms and conditions of this Agreement, including any further commitments that may have been undertaken by the other Parties under this Agreement by the time of such notification, as if it had notified all the other Parties in writing of the completion of its internal procedures before the date of entry into force of this Agreement.

Conclusion

IN WITNESS WHEREOF, the undersigned, being duly authorised thereto, have signed this Agreement on Investment under the Framework Agreement on Comprehensive Economic Cooperation among the Governments of the Member Countries of the Association of Southeast Asian Nations and the Republic of Korea.

DONE at Jeju-do, Republic of Korea, this 2nd day of June 2009, in duplicate copies in the English language.

For the Government of Brunei Darussalam:

LIM JOCK SENG

Second Minister of Foreign Affairs and Trade

For the Government of the Republic of Korea:

KIM JONG-HOON

Minister for Trade

For the Royal Government of Cambodia

CHAM PRASIDH

Senior Minister and Minister of Commerce

For the Government of the Republic of Indonesia:

MARl ELKA PANGESTU

Minister of Trade

For the Government of the Lao Peoples Democratic Republic:

NAM VIYAKETH