4. Payment shall be made without delay. The time that elapses between the moment of fixing the compensation and the moment of payment shall not cause prejudice to the investor. Consequently, its amount shall be sufficient to ensure that the investor may, if it decides to transfer it, obtain, at the time of payment, an equal amount of the international currency normally used as a reference by the Party carrying out the expropriation. The payment shall also include interest at the current market rate for the reference currency.
Article 17-09. Special Formalities and Information Requirements
1. Nothing in Article 17-03 shall be construed to prevent a Party from adopting or maintaining a measure prescribing special formalities in connection with the establishment of investments by investors of another Party, such as that the investments be constituted in accordance with the laws and regulations of the Party, provided that such formalities do not substantially impair the protection afforded by a Party under this Chapter.
2. Notwithstanding Articles 17-03 and 17-04, each Party may require an investor of another Party or its investment in its territory to provide information concerning that investment, as provided in that Party's law. Each Party shall protect information that is confidential from any disclosure that could adversely affect the competitive position of the investment or the investor.
Article 17-10. Relationship with other Chapters
In the event of any inconsistency between any provision of this Chapter and any other provision of this Agreement, the latter shall prevail to the extent of the inconsistency.
Article 17-11. Denial of Benefits.
A Party may, after notice to and consultation with the other Party, deny the benefits of this Chapter to an investor of another Party that is an enterprise of that Party, and to investments of that investor, if investors of a non-Party own or control a majority of the capital of the enterprise and the enterprise does not have substantial business activities in the territory of the Party under whose law it is incorporated or organized.
Article 17-12. Extraterritorial Application of the Legislation of a Party.
No Party may, in relation to investments of its investors constituted and organized under the laws and regulations of another Party, exercise jurisdiction or take any action that has the effect of extraterritorially applying its laws or hindering trade between the Parties, or between a Party and a non-Party.
Article 17-13. Measures Relating to the Environment.
No Party shall eliminate domestic health, safety or environmental measures, or undertake to exempt from their application to an investment of an investor of any country, as a means of inducing the establishment, acquisition, expansion or retention of the investment in its territory. If a Party considers that another Party has encouraged an investment in such a manner, it may request consultations with that other Party.
Article 17-14. Investment Promotion and Information Exchange.
1. With the intention of increasing reciprocal investment participation, the Parties shall design and implement mechanisms for the dissemination, promotion and exchange of information regarding investment opportunities.
2. The Parties undertake to establish mechanisms for the exchange of fiscal and tax information.
Article 17-15. Double Taxation.
The Parties agree to initiate, between them, bilateral negotiations for the conclusion of agreements to avoid double taxation, according to the schedule to be established between the respective competent authorities.
Section B. Dispute Settlement between a Party and an Investor of Another Party
Article 17-16. Objective and Scope of Application.
1. This section and the annex to this article are intended to ensure equal treatment of investors of each Party on the basis of reciprocity and compliance with the rules and principles of international law, with the due exercise of the guarantees of hearing and defense within a legal process before an impartial tribunal.
2. The mechanism set out in this Section shall apply to investment claims brought by an investor of a Party (disputing investor) against a Party (disputing Party) regarding the breach of an obligation set out in this Chapter after the entry into force of this Agreement. The foregoing is without prejudice to an attempt by the disputing investor and the disputing Party (disputing parties) to settle the dispute through consultation or negotiation.
Article 17-17. Requirements for the Filing of a Claim.
1. An investor of a Party may, on its own account or on behalf of an enterprise owned or effectively controlled by it, submit to arbitration a claim that another Party has breached an obligation under this Chapter, provided that the investor has suffered loss or damage by reason of, or arising out of, the breach.
2. An enterprise that is an investment may not submit a claim to arbitration under this section.
3. The investor may not file a claim under this section if more than three years have elapsed from the date on which the investor knew or should have known of the alleged breach and of the loss or damage suffered.
4. An investor that initiates proceedings before any court with respect to the measure alleged to be in violation of the provisions of this Chapter may not bring a claim under this Section. Nor may the investor bring a claim under this section on behalf of an enterprise owned or controlled by the investor that has initiated proceedings before any judicial tribunal with respect to the same measure alleged to be in violation. The foregoing does not apply to the exercise of administrative remedies before the authorities implementing the allegedly violative measure themselves, as provided for in the law of the disputing Party.
5. The investor bringing a claim under this section, or the enterprise on whose behalf the claim is brought, may not institute proceedings in any court of law with respect to the allegedly violative measure.
Article 17-18. Communication and Submission of the Claim to Arbitration.
1. A disputing investor intending to submit a claim to arbitration under the terms of this Section shall so inform the disputing Party.
2. Provided that ninety days have elapsed since the communication referred to in the preceding paragraph and six months have elapsed since the measures giving rise to the claim took place, a disputing investor may submit the claim to arbitration in accordance with:
a) the Rules of the Convention on the Settlement of Investment Disputes between States and Nationals of other States, done at Washington on March 18, 1965 ("ICSID Convention"), when the disputing Party and the Party of the investor are States parties thereto;
b) the ICSID Additional Facility Rules, where either the disputing Party or the Party of the investor, but not both, is a State party to the ICSID Convention; or
c) the Arbitration Rules of the United Nations Commission on International Trade Law ("UNCITRAL Arbitration Rules"), adopted by the General Assembly of the United Nations on December 15, 1976, where the disputing Party and the Party of the investor are not a State party to the ICSID Convention, or the ICSID Convention is not available.
3. The rules specific to each of the arbitration proceedings referred to in the preceding paragraph shall apply except to the extent provided by this section.
4. Each Party consents to submit claims to arbitration in accordance with the provisions of this section.
Article 17-19. Consolidation of Proceedings.
1. If any disputing party requests consolidation of proceedings, a consolidation tribunal shall be constituted in accordance with the UNCITRAL Arbitration Rules and shall proceed in accordance with the provisions of those rules, except as provided in this section.
2. Proceedings shall be consolidated in the following cases:
a) when an investor files a claim on behalf of an enterprise that is under its effective control and at the same time one or more other investors that have an interest in the same enterprise, without controlling it, file claims on their own account as a result of the same violations; or
b) where two or more claims are submitted to arbitration which raise in common questions of law and fact in respect of the same violation by a Party.
3. The consolidation tribunal shall consider such claims together, unless it determines that the interests of any of the disputing parties would be prejudiced.
Article 17-20. Applicable Law
1. Any tribunal established under this Section shall decide disputes submitted to it in accordance with this Agreement and the applicable rules of international law.
2. The Commission's interpretation of a provision of this Agreement shall be binding on any tribunal established pursuant to this section.
Article 17-21. Final Award
1. Where a tribunal established under this section makes an award unfavorable to a Party, that tribunal may only provide:
a) the payment of pecuniary damages and interest thereon; or
b) restitution of property. In such a case the award shall provide that the disputing Party may pay monetary damages, plus interest as appropriate, in lieu of restitution, stating the respective amount.
2. When the claim is made by an investor on behalf of a company:
a) the award providing for the restitution of the property shall provide that restitution or, as the case may be, substitute compensation shall be granted to the enterprise;
b) the award providing for the payment of pecuniary damages and interest thereon shall establish that the sum of money is to be paid to the company.
3. The award shall be made without prejudice to the rights of any person with a legal interest in the reparation of damages suffered, in accordance with applicable law.
Article 17-22. Payments Under Insurance or Guarantee Contracts.
The disputing Party shall not assert as a defense, counterclaim, right of set-off or otherwise, that the disputing investor received or will receive, under an insurance or guarantee contract, indemnification or other compensation for all or part of the damages for which restitution is sought.
Article 17-23. Finality and Enforcement of the Award.
1. The award rendered by any tribunal established under this section shall be binding only upon the disputing parties and only in respect of the particular case.
2. The disputing Party shall abide by and comply with the award without delay and shall provide for its due execution.
3. If the Party whose investor was a party to the arbitration proceedings considers that the disputing Party has failed to comply with or abide by the final award, it may resort to the dispute settlement procedure between the Parties, established in Chapter XIX, to obtain, if appropriate, a ruling that the disputing Party abide by the final award and comply with it.
4. The disputing investor may seek enforcement of an arbitral award under the ICSID Convention, the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York, June 10, 1958; (New York Convention) or the Inter-American Convention on International Commercial Arbitration, done at Panama, January 30, 1975; (Inter-American Convention), whether or not the proceedings referred to in paragraph 3 have been instituted.
Article 17-24. Exclusions.
Measures adopted by a Party under Article 17-02, paragraph 4, or a decision prohibiting or restricting the acquisition of an investment in its territory by an investor of another Party shall not be subject to the dispute settlement mechanism provided for in this Section.
Annex to Article 17-08.
1. Colombia reserves in its entirety the application of Article 17-08 of this Chapter. Colombia shall not establish more restrictive measures on nationalization, expropriation and compensation than those in force at the entry into force of this Agreement.
2. Mexico and Venezuela will only apply the aforementioned article with respect to Colombia from the moment Colombia notifies them of the withdrawal of its reservation.
Annex to Article 17.16. Rules of procedure
Rule 1: Notice of intention to submit the claim to arbitration.
The disputing investor, at the time of communicating to the disputing Party its intention to submit a claim to arbitration, shall indicate the following points:
a) the name, corporate name and domicile of the disputing investor and the name or corporate name and domicile of the company when the claim has been made on its behalf, evidencing ownership or effective control thereof;
b) the provisions alleged to have been breached and any other applicable provisions; (c) the facts on which the claim is based; and d) the relief requested and the approximate amount of damages claimed.
Rule 2: Conditions precedent to the submission of a claim to arbitration.
1. A disputing investor on its own behalf and an investor on behalf of an enterprise may submit a claim to arbitration pursuant to Section B of this Chapter and this Annex only if:
a) in the case of the self-employed investor, the self-employed investor consents to submit to arbitration under the terms of the procedures set forth in Section B of this Chapter and this Annex;
b) in the case of the investor on behalf of an enterprise, both the investor and the enterprise consent to submit to arbitration under the terms of the procedures set forth in Section B of this Chapter and this Annex; and
c) the investor or the enterprise, or both, as the case may be, undertake in writing not to initiate proceedings before any judicial tribunal with respect to the alleged violation of this Chapter. The foregoing does not apply to the exercise of administrative remedies before the authorities that have adopted the allegedly violative measure, as provided for in the legislation of the disputing Party.
2. The consent required by this rule shall be in writing, delivered to the disputing Party and included in the submission of the claim to arbitration.
3. The consent of the investor to submit the claim to arbitration shall be deemed sufficient to meet the requirements set forth in:
a) Chapter II of the ICSID Convention and the Additional Facility Rules requiring the written consent of the Parties;
b) Article II of the New York Convention, which requires a written agreement; and
c) Article I of the Inter-American Convention, which requires an agreement.
Rule 3: Number of Arbitrators and Method of Appointment.
The tribunal shall be composed of three arbitrators. Each of the disputing parties shall appoint one arbitrator; the third arbitrator, who shall be the chairman of the arbitral tribunal, shall be appointed by the disputing parties by mutual agreement. The foregoing is except as provided for the consolidation tribunal in accordance with Article 17-19 of this Chapter and notwithstanding any agreement of the disputing parties to the contrary.
Rule 4: Composition of the tribunal in the event that one of the disputing parties fails to appoint an arbitrator or fails to reach an agreement on the appointment of the chairman of the arbitral tribunal.
1. The Secretary-General of ICSID (Secretary-General) shall appoint arbitrators in arbitration proceedings in accordance with this Annex.
2. Where a tribunal, other than the consolidation tribunal, is not constituted within ninety days from the date on which the claim is submitted to arbitration, the Secretary General, at the request of any of the disputing parties, shall appoint, at his discretion, the arbitrator or arbitrators not yet appointed, but not the chairman of the tribunal, who shall be appointed in accordance with paragraph 3 of this Rule.
3. The Secretary-General shall appoint the president of the tribunal from the list of arbitrators referred to in paragraph 4, ensuring that the president of the tribunal is not a national of the disputing Party or a national of the Party of the disputing investor. In the event that no arbitrator is available on the list to chair the tribunal, the Secretary-General shall appoint, from the ICSID Panel of arbitrators, the chairperson of the arbitral tribunal, provided that the chairperson is not a national of the disputing Party or a national of the Party of the disputing investor.
4. As of the date of entry into force of this Agreement, the Parties shall establish and maintain a list of 15 arbitrators as potential presiding arbitrators of the arbitral tribunal. Such arbitrators shall meet the qualifications set forth in the ICSID Convention. The members of the list shall be appointed by consensus without regard to their nationality.
Rule 5: Consent to the appointment of arbitrators.
For the purposes of Article 39 of the ICSID Convention and Article 7 of Part C of the Additional Facility Rules, and without prejudice to objecting to an arbitrator on grounds other than nationality:
a) the disputing Party accepts the appointment of each of the members of a tribunal established in accordance with the ICSID Convention or the Additional Facility Rules;
b) a disputing investor, whether on its own behalf or on behalf of an enterprise, may submit a claim to arbitration or continue proceedings under the ICSID Convention or the Additional Facility Rules only on condition that the disputing investor and, if applicable, the enterprise it represents, consent in writing to the appointment of each of the members of the tribunal.
Rule 6: Consolidation of proceedings.
1. Where a consolidation tribunal determines that the claims submitted to arbitration pursuant to section 17-17 of this chapter raise common questions of law and fact, the consolidation tribunal, in the interest of their fair and expeditious resolution, and having heard the disputing parties, may agree:
a) assume jurisdiction over, process and settle any or all claims, jointly; or
b) assume jurisdiction over, process and resolve one or more of the claims on the basis that it will contribute to the resolution of the other claims.
2. Adisputing party seeking a determination of consolidation under paragraph 1 shall request the Secretary-General of ICSID to establish a consolidation tribunal and shall specify in its request:
a) the name of the disputing Party or the disputing investors against which the cumulation agreement is sought;
b) the nature of the accumulation agreement requested; and
c) the basis on which the requested petition is supported.
3. Within 60 days from the date of the request, the Secretary-General of ICSID shall designate from the list referred to in Rule 5, paragraph 4 of this Annex the three members of the consolidation tribunal, indicating who shall preside over it. In the event that the Secretary-General of ICSID does not find the persons necessary to make these appointments from the list referred to above, the Secretary-General of ICSID shall make such appointments from the ICSID Panel of Arbitrators. If no arbitrators are available on that panel, the Secretary-General of ICSID shall make the missing appointments at his discretion. One member of the tribunal shall be a national of the disputing Party, and the other member shall be a national of the Party to which one of the disputing investors belongs. In any event, the president of the consolidation tribunal shall not be a national of the disputing Party or a national of the Party or Parties of the disputing investor or investors.
4. Where a consolidation tribunal has been established, a disputing investor that has submitted a claim to arbitration, and has not been named in the request for consolidation made pursuant to paragraph 2, may request in writing to that consolidation tribunal to be included in the request for consolidation made pursuant to paragraph 1, and shall specify in that request:
a) the name and domicile of the disputing investor and, if applicable, the name or corporate name and domicile of the company;
b) the nature of the accumulation agreement requested; and c) the grounds on which the petition is based.
The consolidation tribunal shall provide, at the expense of the investor concerned, a copy of the request for cumulation to the disputing investors against whom the cumulation agreement is sought.
5. Once the consolidation tribunal has assumed jurisdiction over a claim, the jurisdiction of the tribunal constituted to hear the claim shall cease. At the request of a disputing party, the consolidation tribunal may, pending its decision on its jurisdiction over a claim, order the arbitral tribunal constituted to hear the claim to stay the proceedings.
6. Within 15 days from the date of its receipt, the disputing Party shall send to the Commission a copy of:
a) the request for arbitration made pursuant to Article 36(1) of the ICSID Convention;
b) the notice of arbitration pursuant to Article 2 of Part C of the ICSID Additional Facility Rules;
c) the notice of arbitration under the terms of the UNCITRAL Arbitration Rules;
d) the request for cumulation made by a disputing investor; e) the request for joinder made by the disputing Party; or
f) the request for inclusion in a cumulation request made by a disputing investor. The Commission shall keep a record of the documents referred to in this paragraph.
Rule 7: Communication The disputing Party shall send to the other Parties:
a) communication of a claim that has been submitted to arbitration within 30 days from the date of submission of the claim to arbitration; and
b) if they so request, and at their own expense, a copy of the communications submitted in the arbitration proceedings.
Rule 8: Participation of a party.
Upon notice to the disputing parties, a Party may submit to any tribunal established under Section B of this Chapter its views on a question of interpretation of this Agreement.
Rule 9: Documentation.
1. Each Party shall be entitled to receive, upon request and at its own expense, from the disputing Party a copy of:
a) evidence offered to any court established pursuant to section B of this chapter; and
b) the written communications submitted by the disputing parties.
2. The Party receiving information pursuant to paragraph 1 shall treat such information as confidential.
Rule 10: Place of arbitration proceedings.
Any tribunal established under Section B of this Chapter shall, unless the disputing parties agree otherwise, conduct the arbitral proceedings in the territory of one of the Parties.
Rule 11: Interpretation of annexes of reservations and exceptions.
1. The interpretation of the Commission with respect to any provision of this Agreement shall be binding on any tribunal established pursuant to section B of this chapter.
2. The arbitral tribunal shall, at the request of the Party, request the interpretation of the Commission where that Party claims, as a defense, that a measure alleged to be in breach of this Agreement falls within the scope of a reservation or exception set forth in any of its annexes. If the Commission does not submit its interpretation in writing within sixty days of the delivery of the request, the arbitral tribunal shall decide the matter.
Rule 12: Provisional or precautionary measures.
The tribunal constituted under Section B of this Chapter may take provisional measures to establish its jurisdiction or to preserve the rights of the disputing parties. The tribunal may not order injunctive relief or the suspension of the application of the measure alleged to be in breach of this Agreement.
Rule 13: Finality and enforcement of the award.
1. The disputing party may request enforcement of a final award provided that: a) in the case of a final award rendered under the ICSID Convention:
(i) 120 days have elapsed since the date on which the award was rendered without any disputing party having requested the revision or annulment of the award; or
(ii) the review or annulment proceedings have been concluded; and
b) in the case of a final award rendered under the ICSID Additional Facility Rules or the UNCITRAL Arbitration Rules:
(i) three months have elapsed since the date on which the award was rendered without any disputing party having commenced revision or annulment proceedings; or
(ii) a request for revision or annulment of the award has been dismissed or declared admissible by a tribunal of the disputing Party and this decision cannot be appealed.
2. For the purposes of Article 1 of the New York Convention and Article 1 of the Inter-American Convention, a claim submitted to arbitration under Section B of this Chapter shall be deemed to arise out of a commercial relationship or transaction.
Rule 14: General provisions.
1. Aclaimis considered submitted to arbitration under the terms of section B of this chapter when:
a) the request for arbitration under Article 36(1) of ICSID has been received by the Secretary-General;
b) the notice of arbitration, in accordance with Article 2 of Part C of the ICSID Additional Facility Rules, has been received by the Secretary-General; or
c) the notice of arbitration referred to in the UNCITRAL Arbitration Rules has been received by the disputing Party.
2. Delivery of communications and other documents to a Party shall be made to the national section of that Party at the address referred to in Article 20-02, paragraph 1.
3. Final awards will be published only if there is a written agreement between the disputing parties.
Chapter XVIII. Intellectual Property
Section A. General Provisions.
Article 18-01. Basic Principles.
1. Each Party shall grant in its territory to nationals of another Party adequate and effective protection and defense of intellectual property rights under the same conditions as to its own nationals and shall ensure that measures designed to defend such rights do not in turn become barriers to legitimate trade.
2. With respect to the existence, acquisition, scope, maintenance, use and enforcement of intellectual property rights referred to in this Chapter, any advantage, favor, privilege or immunity granted by a Party to the holders of intellectual property rights of any other country shall be accorded immediately and unconditionally to the holders of intellectual property rights of the other Parties.
3. Each Party may provide in its legislation broader protection for intellectual property rights than that required by this Chapter, provided that such protection is not inconsistent with this Chapter or with the commitments undertaken by the Parties in international conventions.
4. Nothing in this Chapter shall prevent each Party from providing in its legislation for licensing practices or conditions that, in particular cases, may constitute an abuse of industrial property rights with an adverse effect on competition in the relevant market. Each Party may accept or maintain, in accordance with other provisions of this Agreement, appropriate measures to prevent or control such practices or conditions.
5. No Party may grant licenses for the reproduction or translation of works protected in accordance with Article 18-03, when such reproduction or translation would be contrary to the normal exploitation of the work or would unreasonably prejudice the economic interests of the owner of the respective right.