2. Paragraph 1 shall be applied, in accordance with the following terms:
(a) Transfers shall be effected in accordance with the legislation of each Party relevant to procedures of transfers without undue delay in the freely usable currency in which the capital was originally invested or in any other freely usable currency agreed by the investor and the Host Party; provided that the investor has complied with all his fiscal and other financial obligations to government or local authorities of the Host Party.
(b) Unless otherwise agreed by the investor, transfers shall be made at the rate of exchange applicable on the date of transfer pursuant to the exchange regulations in force in the Host Contacting Party.
(c) In any case, transfers shall be in terms no less favorable than those accorded by
the Host Party to its own investors in like circumstances.
3. Notwithstanding paragraphs 1 and 2:
(a) When a Party is in or under threat of:
(i) serious balance of payments difficulties; or
(ii) serious difficulties in macroeconomic management relating to the exchange rate policy or monetary policy,
that Party may, in conformity with the principles laid down within Article VII of the IMF Agreement, adopt restrictive measures which may not go beyond what is necessary to remedy the situation, shall be temporary and shall be eliminated as soon as conditions permit.
(b) Such measures shall be equitable, non-discriminatory, and in good faith.
(c) The Host Party shall notify the Home Party, as soon as possible, as to the measures taken.
Article 10.7. EXPROPRIATION
1. Investments of investors of the Home Party shall not be nationalized, expropriated or subjected to measures having effect equivalent to nationalization or expropriation (hereinafter: "expropriation") in the territory of the Host Party, except for a public purpose (1) related to the internal needs of the Host Party, and in accordance with the following terms: (2)
(a) The expropriation shall be made in accordance with the legislation of the Host Party, on a non-discriminatory basis and against prompt, adequate and effective compensation no less favorable than that accorded to the investors of the Host Party. Resulting payments shall be freely transferable.
(b) Such compensation shall amount to the market value of the investment expropriated, immediately before the expropriation or before the imminent expropriation became public knowledge, whichever is the earlier, shall include interest at the applicable rate provided by law of the Host Party until the date of payment, shall be made without delay, be effectively realizable and be freely transferable .
(c) Without prejudice to Article 10.12.8, the investors affected shall have a right, under the law of the Host Party making the expropriation, to prompt review, by a judicial or other independent authority of the Host Party, of the legality of the expropriation and of the valuation of their investment, in accordance with the principles set out in this Article .
2. Notwithstanding the foregoing, with respect to intellectual property rights, a Host Party may permit the use of an intellectual property right, provided such permission is made in conformity with the principles set forth in the TRIPS Agreement.
3. It is understood that the determination whether a measure or series of measures of a Party constitutes an effect equivalent to nationalization or expropriation requires a case-by- case, fact-based inquiry, considering, inter alia:
(a) The economic impact of the measure or series of measures; (3)
(b) The level of interference on the reasonable expectations concerning the investment;
(c) The character of the measure or series of measures in accordance with the legitimate public objectives pursued;
(d) The objectives of the measure or series of measures including whether such measure is adopted to protect legitimate public purposes. (4)
Article 10.8. COMPENSATION FOR LOSSES
1. Investors of the Home Party whose investments in the territory of the Host Party suffer losses owing to war or other armed conflict, revolution, a state of national emergency, revolt, insurrection, civil disturbances, riot or other such similar activity in the territory of the Host Party, shall be accorded treatment by the Host Party, as regards to restitution, indemnification, compensation or other settlement, no less favorable than that which the Host Party accords to its own investors or to investors of any non-Party. Resulting payments shall be freely transferable.
2. Without prejudice to paragraph 1, investors of the Home Party who suffer losses in the territory of the Host Party, resulting from:
(a) requisitioning of their property by its forces or authorities; or
(b) destruction of their property by its forces or authorities, which was not caused in combat action or was not required by the necessity of the situation;
shall be accorded restitution or adequate compensation. Resulting payments shall be freely transferable.
Article 10.9. SUBROGATION
1. If a Home Party or its designated Agency makes a payment under an indemnity or under a guarantee or a contract of insurance against non-commercial risk given in respect of an investment in the territory of the Host Party, the Host Party shall recognize:
(a) the assignment to the Home Party by legislation or by legal transaction of all the rights and claims of the investor indemnified; and
(b) that the Home Party is entitled to exercise such rights and enforce such claims by virtue of subrogation, to the same extent as the investor indemnified, and shall assume the obligations related to the investment.
2. The home Party shall be entitled in all circumstances to:
(a) the same treatment in respect of rights, claims and obligations acquired by it, by virtue of the assignment; and
(b) any payments received pursuant to those rights and claims, as the investor indemnified was entitled to receive by virtue of this Chapter, in respect of the investment concerned and its related returns.
Article 10.10. NON DEROGATION
This Chapter shall not derogate from a treatment more favorable than is provided to investors or investments of investors in accordance with this Chapter, under the legislation of the Host Party or obligations of the Host Party under international law.
Article 10.11. EXCEPTIONS
1. Either Party may take measures necessary for the maintenance or protection of its essential security interests. Such measures shall be taken and implemented in good faith, in a non-discriminatory fashion and so as to minimize the deviation from the provisions of this Chapter.
2. Nothing contained in this Chapter shall be construed to prevent a Party from adopting, maintaining or enforcing, in accordance with its legislation, reasonable measures with respect to the financial sector for prudential reasons, including those measures aimed at protecting investors, depositors, insurance takers, trustees, or in general financial consumers, or to safeguard the integrity and stability of the financial system. Such measures shall be in good faith and shall not be used as means of avoiding a Party's commitments or obligations under this Chapter.
3. The provisions of this Chapter, relating to the granting of treatment no less favorable than that accorded to the investors and investments of investors of either Party or of any non- Party, shall not be construed so as to oblige one Party to extend to the investors of the other Party the benefit of any treatment, preference or privilege resulting from:
(a) any international agreement or arrangement relating wholly or mainly to taxation or any legislation relating wholly or mainly to taxation;
(b) any existing or future customs union, free trade area agreement, common market, economic union or similar international agreement, to which either Party is or will be party, within the meaning of "customs union" or "free trade area" in accordance with Article XXIV of the GATT 1994 and Article V of the GATS;
(c) any existing or future bilateral or multilateral agreement concerning intellectual property.
(d) any agreement for the Reciprocal Promotion and Protection of Investments concluded between either Party and a third state, that was signed before 1 July, 2003.
Article 10.12. SETTLEMENT OF DISPUTES BETWEEN a PARTY AND AN INVESTOR OF THE OTHER PARTY
1. In order to submit a claim to arbitration under this Article, non-judicial local administrative remedies (5) shall be exhausted only if required by the legislation of the Party concerned. If the procedures for the exhaustion of such remedies are not completed within six months from the date of their initiation by the investor, the investor shall not be prevented from submitting a claim to arbitration under this Article. Such procedure shall not prevent the investor from requesting consultations as referred to in paragraph 3. This paragraph does not prevent the investor from voluntarily seeking or pursuing non-judicial local administrative remedies.
2. Any investment dispute between a Party and an investor of the other Party in connection with a claim of a breach of the provisions of this Chapter other than Article 10.3.1, Article 10.14 and Article 10.15 shall be settled by consultations and negotiations.
3. Consultations and negotiations shall begin with the submission of a written Notice (hereinafter referred to as Notice of Dispute) by the investor. This notice shall be accompanied by a brief summary of the factual and legal basis of the investment dispute.
4. If a dispute under paragraph 2 cannot be settled within six months of a written Notice of Dispute in accordance with paragraph 3, it shall be settled as follows, upon the request of the investor:
(a) by acompetent court of the Host Party; or
(b) by conciliation; or
(c) by arbitration by the International Center for the Settlement of Investment Disputes (ICSID), established by the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, opened for signature at Washington, D.C. on March 18, 1965 (hereinafter referred to as the ICSID Convention), provided that both Parties are contracting parties to the Convention; or
(d) by arbitration under the Additional Facility Rules of ICSID (hereinafter referred to as the ICSID Additional Facility Rules), provided that only one of the Parties is a contracting party to the ICSID Convention; or
(e) by an ad hoc arbitration tribunal, which unless otherwise agreed, is to be established under the Arbitration Rules of the United Nations Commission on International Trade Law, as revised in 2010 Unless otherwise agreed, all submissions shall be made and all hearings shall be completed within six months of the date of selection of the Chairman, and the arbitral panel shall render its written and reasoned decisions within two months of the date of the final submissions or the date of the closing of the hearings, whichever is later;
(f) Subparagraphs (c), (d) and (e) shall not apply to disputes between a Host Party and any legal entity qualifying as an Investor of a Home Party, that is owned or controlled by a natural person or legal entity of the Host Party;
(g) an investor shall only submit a dispute to arbitration in accordance with subparagraphs (c), (d) and (e), once 90 days have elapsed from the submission of a written notice (hereinafter referred to as Notice of Intent). The Notice of Intent shall only be submitted if the dispute was not settled within six months from the Notice of Dispute and shall indicate the name and address of the disputing investor, the provisions of this Chapter which he deems to be breached, the facts which the dispute is based on, and the approximate amount of damages.
5. Each Party hereby gives its unconditional consent to the submission of a dispute to international arbitration in accordance with paragraphs 4(c), 4(d) and 4(e). This consent and the submission by a disputing investor of a claim to arbitration shall satisfy the requirements of:
(a) Chapter II of the ICSID Convention or the ICSID Additional Facility Rules for written consent of the parties;
(b) Article II of the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958 (hereinafter referred as to The New York Convention), for an agreement in writing.
6. As long as both Parties are contracting parties to the ICSID Convention, the provisions set forth in Article 27 thereof shall apply to disputes that have been submitted to arbitration under this Article.
7. An investor shall not submit a Notice of Dispute if more than three years have elapsed since the date the investor had knowledge or should have had knowledge of the alleged violation of the provisions of this Chapter, as well as of the alleged losses and damages.
8. (a) Once the investor has submitted the dispute to either a competent court of the Host Party or to any of the arbitration mechanisms stated in paragraph 4, the choice of the procedure shall be final;
(b) Notwithstanding subparagraph (a), an investor shall not be prevented from initiating actions, or interim measures not involving the payment of monetary damages before a competent court of the Host Party, provided that the action is initiated for the purpose of preserving the investor's rights and interests.
9. The award shall be final and binding. Each Party shall carry out without undue delay the provisions of any such award and provide in its territory for the enforcement of such award.
10. A tribunal shall decide the issues in dispute in accordance with this Agreement and applicable rules of international law. A tribunal does not have jurisdiction to determine the legality of a measure, alleged to constitute a breach of this Chapter, under the legislation of the disputing Party.
11. The tribunal shall consider whether either the claim of the claimant or the objection of the respondent is manifestly without legal merit, and shall provide the disputing parties a reasonable opportunity for comments. In the event of a claim found to be manifestly without legal merit, the tribunal shall, if warranted, award costs against the claimant.
12. The Notice of Dispute, the Notice of Intent, and other documents related to the dispute, shall be presented to the authority/agency of the Host Party, designated in Annex 10- A.
13. The arbitrators shall:
(a) have experience or expertise in international public law, international investment rules, or in dispute settlement derived from international investment agreements;
(b) be independent and not affiliated with or take instructions from the investor, or either Party;
(c) be a national of a country with which both Parties maintain diplomatic relations.
14. The disputing parties may agree on the fees to be paid to the arbitrators. If the disputing parties do not reach an agreement on the fees to be paid to the arbitrators before the constitution of the tribunal, the fees established for arbitrators by ICSID shall apply.
Article 10.13. INSURANCE AND GUARANTEE
In any proceeding involving an investment dispute, a Party shall not assert, as a defense, counterclaim, right of set-off or for any other reason, that indemnification or other compensation for all or part of the alleged damages has been received or will be received pursuant to an insurance or guarantee contract.
Article 10.14. INVESTMENT AND ENVIRONMENT
Each Party recognizes that it is inappropriate to encourage investments activities, of investors of the other Party and of a non-Party, by relaxing its domestic environmental legislation.
Article 10.15. RELATION TO OTHER CHAPTERS
1. In the event of any inconsistency between this Chapter and another Chapter to this Agreement, the other Chapter shall prevail to the extent of the inconsistency.
2. Notwithstanding paragraph 1, it is understood that Article 10.12 will apply solely to disputes in connection with a breach of the provisions of this Chapter as set forth in that Article.
Article 10.16. DURATION AND TERMINATION
In respect of investments made while this Agreement is in force, its provisions shall remain in effect with respect to such investments for a period of 10 years after the date of termination of this Agreement and without prejudice to the application thereafter of the rules of general international law.
ANNEX 10-A. PRESENTATION OF DOCUMENTS TO A PARTY
The State of Israel
The place of presentation of the Notice of Dispute, the Notice of Intent and other documents concerning settlement of disputes pursuant to Article 10.12, in the State of Israel is:
Ministry Of Finance International Affairs Department 1 Kaplan St., P.O.Box 3100 Jerusalem, Israel
The Republic of Colombia
The place of presentation of the Notice of Dispute, the Notice of Intent and other documents concerning settlement of disputes pursuant to Article 10.12, in the Republic of Colombia is:
Dirección de Inversión Extranjera y Servicios Ministerio de Comercio, Industria y Turismo Calle 28 #13 A-15
Bogota D.C. - Colombia
Chapter 11. TRADE IN SERVICES
Article 11.1. SCOPE AND COVERAGE
1. This Chapter applies to measures adopted or maintained by Parties affecting trade in services. It applies to all services sectors, except as otherwise specified in this Chapter.
2. For the purpose of this Chapter, "measures by Parties" means measures adopted or maintained by:
(a) central, regional, or local governments and authorities; and
(b) non-governmental bodies in the exercise of powers delegated by central, regional, or local governments or authorities.
3. In respect of air transport services, this Chapter shall not apply to measures affecting air traffic rights as well as measures affecting services directly related to the exercise of air traffic rights, except as provided for in paragraph 3 of the Annex on Air Transport Services of the GATS. The definitions contained in paragraph 6 of the Annex on Air Transport Services of the GATS shall apply for the purpose of this Chapter.
4, Nothing in this Chapter shall be construed to impose any obligation with respect to government procurement, which is subject to Chapter 9 (Government Procurement).
Article 11.2. DEFINITIONS
For the purpose of this Chapter:
a service supplied in the exercise of governmental authority means any service which is supplied neither on a commercial basis nor in competition with one or more service suppliers;
commercial presence means any type of business or professional establishment, including through:
(a) the constitution, acquisition or maintenance of a juridical person; or
(b) the creation or maintenance of a branch or a representative office, within the territory of a Party for the purpose of supplying a service;
direct taxes comprises all taxes on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation;
juridical person of the other Party means a juridical person which is either:
1. constituted or otherwise organized under the law of that other Party, and is engaged in substantive business operations in the territory of:
(a) either Party; or
(b) any Member of the WTO and is owned or controlled by natural persons of that other Party or by juridical persons that meet all the conditions of subparagraph 1(a);
2. a subsidiary or a branch in non-Parties, owned or controlled by a juridical person constituted or otherwise organized under the law of the other Party, which is engaged in substantive business operations in the territory of that other Party; or
3. in the case of the supply of a service through commercial presence, owned or controlled by:
(a) natural persons of that other Party; or
(b) juridical persons of that other Party identified under subparagraph (1);
a juridical person is:
1. "owned" by persons of a Party if more than 50 per cent of the equity interest in it is beneficially owned by persons of that Party;
2. "controlled" by persons of a Party if such persons have the power to name a majority of its directors or otherwise to legally direct its actions;
3. "affiliated" with another person when it controls, or is controlled by, that other person; or when it and the other person are both controlled by the same person;
measures by a Party affecting trade in services includes measures in respect of:
1. the purchase, payment or use of a service;
2. the access to and the use of services, in connection with the supply of a service, which are required by that Party to be offered to the public generally;
3. the presence, including commercial presence, of persons of a Party for the supply of a service in the territory of the other Party;
monopoly supplier of a service means any person, public or private, which in the relevant market of the territory of a Party is authorised or established formally or in effect by that Party as the sole supplier of that service;
natural person of the other Party means a natural person who, under the legislation of that other Party, is:
1. a national of that other Party who resides in the territory of any WTO Member; or
2. a permanent resident of that other Party who resides in the territory of that other Party, if that other Party accords substantially the same treatment to its permanent residents as to its nationals in respect of measures affecting trade in services. For the purpose of the supply of a service through presence of natural persons (Mode 4), this definition covers a permanent resident of that other Party who resides in the territory of the first Party or in the territory of any WTO Member;
sector of a service means:
1. with reference to a specific commitment, one or more, or all, subsectors of that service, as specified in a Party's schedule;
2. otherwise, the whole of that service sector, including all of its subsectors;
services includes any service in any sector except services supplied in the exercise of governmental authority;
service consumer means any person that receives or uses a service;
service of a Party means a service which is supplied:
1. from or in the territory of a Party, or in the case of maritime transport, by a vessel registered under the laws of a Party, or by a person of that Party which supplies the service through the operation of a vessel and/or its use in whole or in part; or
2. in the case of the supply of a service through commercial presence or through the presence of natural persons, by a service supplier of a Party;
service supplier means any person that supplies, or seeks to supply, a service (1);
supply of a service includes the production, distribution, marketing, sale and delivery of a service;
trade in services is defined as the supply of a service:
1. from the territory of one Party into the territory of the other Party;
2. in the territory of one Party to the service consumer of the other Party;
3. by a service supplier of one Party, through commercial presence in the territory of the other Party;
4. by a service supplier of one Party, through presence of natural persons of that Party in the territory of the other Party;
Article 11.3. MOST-FAVORED-NATION TREATMENT
1. Except as provided for in its List of MFN Exemptions contained in Annex 11-A a Party shall accord immediately and unconditionally, in respect of all measures affecting the supply of services, to services and service suppliers of the other Party treatment no less favourable than the treatment it accords to like services and service suppliers of any non-Party.
2. Treatment granted under other agreements concluded by one of the Parties and notified under Article V or Article V bis of the GATS, as well as treatment granted in accordance with Article VII of the GATS, shall not be subject to paragraph 1.