AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINAAND THE GOVERNMENT OF AUSTRALIA ON THE RECIPROCAL ENCOURAGEMENT ANDPROTECTION OF INVESTMENTS
AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINAAND THE GOVERNMENT OF AUSTRALIA ON THE RECIPROCAL ENCOURAGEMENT ANDPROTECTION OF INVESTMENTS
(The Government of the People's Republic of China and theGovernment of Australia (hereinafter referred to as the ContractingParties)
Whole Doc.
RECOGNIZING the importance of promoting the flow of capital for
economic activity and development and aware of its role in expanding
economic relations and technical co-operation between them, particularly
with respect to investment by nationals of one Contracting Party in the
territory of the other Contracting Party;
CONSIDERING that investment relations should be promoted and economic
cooperation strengthened in accordance with the internationally accepted
principles of mutual respect for sovereignty, equality, mutual benefit,
non-discrimination and mutual confidence;
ACKNOWLEDGING that investments of nationals of one Contracting Party
in the territory of the other Contracting Party would be made within the
framework of laws of that other Contracting Party; and
RECOGNIZING that pursuit of these objectives would be facilitated by
a clear statement of principles relating to the protection of investments
and associated activities, combined with rules designed to render more
effective the application for these principles within the territories of
the Contracting Parties,
HAVE AGREED as follows:
ARTICLE I DEFINITIONS
1. For the purposes of this Agreement:
(a) "Company" means any corporation, association, partnership, trust
or other legally recognized entity that is duly incorporated,
constituted, set up, or otherwise duly organized:
(i) under the law of a Contracting Party; or
(ii) under the law of a third country and is owned or controlled by
an entity described in paragraph (1) (a) (i) of this Article or by a
natural person who is a citizen or permanent resident of a Contracting
Party under its law; regardless of whether or not the entity is organized
for pecuniary gain, privately or otherwise owned, or organized with
limited or unlimited liability.
(b) "Investment" means every kind of asset, owned controlled or
contributed by nationals or one Contracting Party and admitted by the
other contracting party subject to its law and investment policies
applicable from time to time and includes:
(i) tangible and intangible property, including rights, such as
mortgages, liens and pledges;
(ii) a company or shares of stock or other interests in a company or
interests in the assets thereof;
(iii) a claim to money or a claim to performance having economic
value;
(iv) intellectual and industrial property rights, including rights
with respect to copyright, patents, trademarks, trade names, industrial
designs, trade secrets, know-how and goodwill;
(v) any rights conferred by law or under a contract permitted by law,
including rights to engage in agriculture, forestry, fisheries and animal
husbandry, rights to search for, extract or exploit natural resources and
rights to manufacture, use and sell products; and
(vi) returns which are reinvested. Any alteration of the form in
which assets are invested or reinvested shall not affect their character
as investments.
(c) "Law" includes regulations.
(d) "National" of a Contracting Party means a natural person who is a
citizen or a permanent resident of a Contracting Party under its law or a
company.
(e) "Return" means an amount derived from or associated with an
investment, including profits, dividends, interest, capital gains, royalty
payments, management or technical assistance fees, payments in kind and
all other lawful income.
(f) "Activities associated with investments", subject to the law of
the Contracting Party which has admitted the investment, includes the
organization, control, operation, maintenance and disposition of
companies, branches, agencies, offices, factories or other facilities for
the conduct of business; the making, performance and enforcement of
contracts; the acquisition, use, protection and disposition of property of
all kinds including industrial and intellectual property rights; and the
borrowing of funds, the purchase and issuance of equity shares, and the
purchase and sale of foreign exchange.
(g) "Territory" in relation to a Contracting Party includes the
territorial sea, maritime zone or continental shelf where that Contracting
Party exercises its sovereignty, sovereign rights or jurisdiction.
2. This Agreement shall not apply to a company organized under the
law of a third country within the meaning of paragraph (1) (a) (ii) of
this Article where the provisions of an investment protection agreement
with that country have already been invoked in respect of the same matter.
3. This Agreement shall not apply to a person who is a permanent
resident but not a citizen of a Contracting Party where:
(a) the provisions of an investment protection agreement between the
other Contracting Party and the country of which the person is a citizen
have already been invoked in respect of the same matter; or
(b) the person is a citizen of the other Contracting Party.
ARTICLE II ENCOURAGEMENT AND ADMISSION OF INVESTMENTS
1. Each Contracting Party shall encourage and promote investments in
its territory by nationals of the other Contracting Party and shall, in
accordance with its law and investment policies applicable from time to
time, admit investments.
2. Each Contracting Party reserves the right to refuse to admit the
investments of any company of the other Contracting Party if nationals of
any third country control such company, or if it has no substantial
business activities in the territory of that other Contracting Party.
3. This Agreement shall not affect the right of a Contracting Party
to allow or prohibit the making of investments within its territory by
nationals of a third country.
4. This Agreement shall not prevent a national of one Contracting
Party from taking advantage of the provisions of any law or policy of the
other Contracting Party which are more favourable than the provisions of
this Agreement.
5. A company duly organized under the law of a Contracting Party
shall not be treated as a national of the other Contracting Party, but any
investments in that company by nationals of that other Contracting Party
shall be protected by this Agreement.
ARTICLE III TREATMENT OF INVESTMENTS
A Contracting Party shall at all times:
(a) ensure fair and equitable treatment in its own territory to
investments and activities associated with such investments;
(b) accord within its territory protection and security to
investments and activities associated with investments and, without
prejudice to its law, shall not impair by unreasonable or discriminatory
measures the management, maintenance, use, enjoyment or disposal of
investments; and
(c) treat investments and activities associated with investments in
its own territory, including compensation under Article VIII and transfers
under Article x, on a basis no less favourable than that accorded to
investments and activities associated with investments of nationals of any
third Country, Provided that a contracting party shall not be obliged to
extend to investments and activities associated with investments any
treatment, preference or privilege resulting from:
(i) any customs union, economic union, free trade area or regional
economic integration agreement to which the Contracting Party belongs; or
(ii) the provisions of a double taxation agreement with a third
country.
ARTICLE IV ENTRY AND SOJOURN OF PERSONNEL
1. A Contracting Party shall, subject to its law and policies
applicable from time to time relating to the entry and sojourn of non-
citizens, permit mutual persons who are nationals of the other Contracting
Party and personnel employed by companies of that other Contracting Party
to enter and remain in its territory for the purpose of engaging in
activities associated with investments.
2. Subject to paragraph 1 of this Article, nationals of one
Contracting Party, who have made investments in the territory of the other
Contracting Party, shall be permitted by that other Contracting Party to
engage within its territory key technical and managerial personnel of
their choice regardless of citizenship.
ARTICLE V SETTLEMENT OF DISPUTES BETWEEN NATIONALS OF THE CON- TRACTING PARTIES
A Contracting Party shall in accordance with its law:
(a) provide nationals of the other Contracting Party who have made
investments within its territory and personnel employed by them for
activities associated with investments full access to its competent
judicial or administrative bodies in order to afford means of asserting
claims and enforcing rights in respect of disputes with its own nationals;
(b) permit its nationals to select means of their choice to settle
disputes relating to investments and activities associated with
investments with the nationals of the other Contracting Party, including
arbitration conducted in a third country; and
(c) provide for the recognition and enforcement of any resulting
judgments or awards.
ARTICLE VI TRANSPARENCY OF LAWS
Each Contracting Party shall, with a view to promoting the
understanding of its laws and policies that pertain to or affect
investments in its territory of nationals of the other Contracting Party:
(a) make such laws and policies public and readily accessible;
(b) if requested, provide copies of specified laws and policies to
the other Contracting Party; and
(c) if requested, consult with the other Contracting Party with a
view to explaining specified laws and policies.
ARTICLE VII LIMITATIONS ON IMMUNITY
Any question arising in relation to an investment or activity
associated with an investment of a national of either Contracting Party
concerning immunity from the jurisdiction of the Courts in any proceeding,
the procedure for service of initiating process or immunity from execution
shall be resolved in accordance with the law of the Contracting Party
which has admitted the investment.
ARTICLE VIII EXPROPRIATION AND NATIONALIZATION
1. A Contracting Party shall not take measures of expropriation or
nationalization or other measures having a similar effect relating to any
investment unless the measures are in the public interest, non
discriminatory, in accordance with the law of the Contracting Party which
has admitted the investment and against reasonable compensation.
2. The compensation referred to in paragraph 1 of this Article shall
be computed on the basis of the market value of the investment immediately
before the measures became public knowledge. Where the market value cannot
be readily ascertained, the compensation shall be determined in accordance
with generally recognized principles of valuation and equitable principles
taking into account the capital invested, depreciation, capital already
repatriated, replacement value and other relevant factors. The
compensation shall include interest at a reasonable rate from the date the
measures were taken to the date of payment, shall be paid without undue
delay, shall be freely convertible and shall be freely transferable
between the territories of the Contracting Parties at the average of the
daily exchange rates, determined on each of those days in accordance with
the law of the Contracting Party which has admitted the investment, over
the six months immediately prior to the taking of the measures.
ARTICLE IX WAR OR ARMED CONFLICT
Nationals of a Contracting Party, whose investments suffer losses in
the territory of the other Contracting Party owing to war or other armed
conflict, insurrection, revolt, or other similar events, shall be accorded
treatment by the other Contracting Party no less favourable than that
accorded to nationals of any third country, should it adopt any measures
relating to such losses.
ARTICLE X TRANSFERS
1. A Contracting Party shall, when requested, permit, subject to its
law and policies, all funds of a national of the other Contracting Party
related to an investment or activities associated with an investment in
its territory, and earnings and other assets of personnel engaged from
abroad in connection with an investment, to be transferred freely and
without undue delay. Such funds include the following:
(a) the initial capital plus any additional contributions used to
maintain or expand the investment;
(b) returns;
(c) fees, including payments in connection with intellectual and
industrial property rights;
(d) receipts from the whole or partial sale, divestment or
liquidation of the investment;
(e) payments made pursuant to a loan agreement; and
(f) capital accretions.
2. The transfers abroad of such funds and the earnings of personnel
shall be permitted in freely convertible currencies as classified by the
International Monetary Fund and shall be made at the exchange rate
determined in accordance with the law of the Contracting Party which has
admitted the investment on the date of transfer.
3. Either Contracting Party may protect the rights of creditors, or
ensure the satisfaction of judgments in adjudicative proceedings, through
the equitable, non-discriminatory and good faith application of its law.
ARTICLE XI UNDERTAKINGS GIVEN TO INVESTORS
A Contracting Party shall, subject to its law, adhere to any written
undertakings given by a competent authority to a national of the other
Contracting Party with regard to an investment in accordance with its law
and the provisions of this Agreement.
ARTICLE XII SETTLEMENT OF DISPUTES BETWEEN ONE CONTRACTING PARTY AND NATIONAL OF THE OTHER CONTRACTING PARTY RELATING TO INVESTMENTS
1. In the event of a dispute between a Contracting Party and a
national of the other Contracting Party relating to an investment or an
activity associated with an investment, the parties to the dispute shall
initially seek to resolve the dispute by consultations and negotiations.
2. If the dispute has not been settled within three months from the
date either party gave notice in writing to the other concerning the
dispute, either party may take the following action:
(a) in accordance with the law of the Contracting Party which has
admitted the investment, initiate proceedings before its competent
judicial or administrative bodies; and
(b) where the parties agree or where the dispute relates to the
amount of compensation payable under Article VIII, submit the dispute to
an Arbitral Tribunal constituted in accordance with Annex A of this
Agreement.
3. The action referred to in paragraph 2 of this Article shall be
without prejudice to the right of the parties to seek assistance with
regard to the dispute from any competent government agency of the
Contracting Party which has admitted the investment.
4. In the event that both the People's Republic of China and
Australia become party to the 1965 Convention on the Settlement of
Investment Disputes Between States and Nationals of Other States, a
dispute may be submitted to the International Centre for the Settlement of
Investment Disputes for resolution in accordance with the terms on which
the Contracting Party which has admitted the investment is a party to the
Convention.
5. In any proceeding involving a dispute relating to an investment or
an activity associated with an investment, a Contracting Party shall not
assert, as a defence, counter-claim, right of set-off or otherwise, that
the national concerned has received or will receive, pursuant to an
insurance or guarantee contract, indemnification or other compensation for
all or part of any alleged loss. Nevertheless, a national of a Contracting
Party involved in such a dispute shall not be entitled to compensation for
more than the value, as determined in accordance with paragraph 2 of
Article VIII, of the investment which is the subject of the dispute,
taking into account all sources of compensation within the territory of
the Contracting Party liable to pay compensation.
ARTICLE XIII SETTLEMENT OF DISPUTES BETWEEN CONTRACTING PARTIES
1. The Contracting Parties shall consult when necessary on matters
concerning the operation of this Agreement.
2. The Contracting Parties shall endeavour to resolve any dispute
between them on the interpretation or application of this Agreement by
prompt and friendly negotiations and consultations. If a dispute is not
resolved by such means within sixty days of one Contracting Party seeking
in writing such negotiations or consultations, it shall be submitted at
the request of either Contracting Party to an Arbitral Tribunal
established in accordance with the provisions of Annex B of this
Agreement, or, by agreement, to any other international tribunal.
ARTICLE XIV ENTRY INTO FORCE, DURATION AND TERMINATION
1. This Agreement shall enter into force on signature. It shall
remain in force for a period of ten years and thereafter shall remain in
force indefinitely, unless terminated in accordance with paragraph 3 of
this Article.
2. This Agreement shall apply to investments made after 21 December
1972.
3. At the end of the first period of ten years referred to in
paragraph 1 of this Article and thereafter at any time either Contracting
Party may terminate this Agreement by giving one year's written notice to
the other Contracting Parties.
4. Notwithstanding its termination in accordance with paragraph 3 of
this Article, this Agreement shall continue to apply, for a further period
of ten years from the date of its termination, to investments made or
acquired prior to the date of its termination.
IN WITNESS WHEREOF the undersigned, being duly authorized thereto by
their respective Governments, have signed this Agreement.
DONE in duplicate at Beijing on the Eleventh day of July, 1988 in the
Chinese and English languages, both texts being equally authentic.
(Zheng Tuobin) (Bill Hayden)
FOR THE GOVERNMENT OF THE FOR THE
GOVERNMENT OF
PEOPLE'S REPUBLIC OF CHINA AUSTRALIA
ANNEX A
1. The Arbitral Tribunal referred to in paragraph 2 (b) of Article
XII shall consist of 3 persons appointed as follows: each party to the
dispute shall appoint one arbitrator; the arbitrators appointed by the
parties to the dispute shall, within 30 days of the appointment of the
last of their number, by agreement, select an arbitrator as Chairman who
is a national of a third country which has diplomatic relations with both
Contracting Parties.
2. If, within 60 days after a party has given notice in writing
instituting the arbitration proceedings, agreement has not been reached on
a Chairman of the Arbitral Tribunal, either party to the dispute may
request the President of the International Bank for Reconstruction and
Development to make the appointment.
3. If a party to the dispute, receiving notice in writing from the
other party of the institution of arbitration proceedings and the
appointment of an arbitrator, shall fail to appoint its arbitrator within
30 days of receiving notice from the other party, such arbitrator shall be
appointed by the Chairman of the Arbitral Tribunal after the Chairman is
appointed.
4. In case any arbitrator appointed as provided in this Annex shall
resign, die or otherwise become unable to perform his functions as an
arbitrator, a successor arbitrator shall be appointed in the same manner
as prescribed for the appointment of the original arbitrator and his
successor shall have all the powers and duties of the original arbitrator.
5. The Arbitral Tribunal shall, subject to the provisions of any
agreement between the parties to the dispute, determine its procedure by
reference to the rules of procedure contained in the 1965 Convention on
the Settlement of Investment Disputes Between States and Nationals of
Other States.
6. The Arbitral Tribunal shall decide all questions relating to its
competence.
7. Before the Arbitral Tribunal makes a decision it may at any stage
of the proceedings propose to the parties that the dispute be settled
amicably. The Arbitral Tribunal shall reach its award by majority vote
taking into account the provisions of this Agreement, any agreement
between the parties to the dispute and the relevant domestic law of the
Contracting Party which has admitted the investment.
8. An award shall be final and binding and shall be enforced in the
territory of each Contracting Party in accordance with its law.
9. Each party to the dispute shall bear the costs of its appointed
arbitrator. The cost of the Chairman and other expenses associated with
the conduct of the arbitration shall be borne equally by the parties.
ANNEX B
1. The Arbitral Tribunal referred to in Article XIII shall consist of
three persons appointed as follows: each Contracting Party shall appoint
one arbitrator, and a third arbitrator, who shall be a national of a
country with which both Contracting Parties maintain diplomatic relations,
shall be appointed by the agreement of the Contracting Parties. This third
arbitrator shall also act as "Chairman of the Tribunal".
2. Arbitration proceedings shall be instituted upon notice being
given through the diplomatic channel by the Contracting Party instituting
such proceedings to the other Contracting Party. Such notice shall contain
a statement setting forth in summary form the grounds of the claim, the
nature of the relief sought, and the name of the arbitrator appointed by
the Contracting Party instituting such proceedings. Within 60 days after
the giving of such notice the respondent Contracting Party shall notify
the Contracting Party instituting proceedings of the name of the
arbitrator appointed by the respondent Contracting Party.
3. If, within 60 days after the giving of notice instituting the
arbitration proceedings the Contracting Parties shall not be agreed upon a
Chairman of the Tribunal, either Contracting Party may request the
President of the International Court of Justice to make the appointment.
If the President is a national of either Contracting Party or is otherwise
unable to act, the Vice-President shall be invited to make the
appointment. If the Vice-President is a national of either Contracting
Party or is unable to act, the Member of the International Court of
Justice next in seniority who is not a national of either Contracting
Party shall be invited to make the appointment.
4. In case any arbitrator appointed as provided in this Annex shall
resign, die or otherwise become unable to act, a successor arbitrator
shall be appointed in the same manner as prescribed for the appointment of
the original arbitrator and his successor shall have all the powers and
duties of the original arbitrator.
5. The Arbitral Tribunal shall convene at such time and place as
shall be fixed by the Chairman of the Tribunal. Thereafter, the Arbitral
Tribunal shall determine where and when it shall sit.
6. The Arbitral Tribunal shall decide all questions relating to its
competence and shall, subject to any agreement between the Contracting
Parties, determine its own procedure.
7. Before the Arbitral Tribunal makes a decision, it may at any stage
of the proceedings propose to the Contracting Parties that the dispute be
settled amicably. The Arbitral Tribunal shall reach its award by majority
vote taking into account the provisions of this Agreement, the
international agreements both Contracting Parties have concluded and the
generally recognized principles of international law.
8. Each Contracting Party shall bear the costs of its appointed
arbitrator. The cost of the Chairman and other expenses associated with
the conduct of the arbitration shall be borne in equal parts by both
Contracting Parties.
9. The Arbitral Tribunal shall afford to the Contracting Parties a
fair hearing. It may render an award on the default of a Contracting
Party. Any award shall be rendered in writing and shall state its legal
basis. A signed counterpart of the award shall be transmitted to each
Contracting Party.
10. An award shall be final and binding on the Contracting Parties.
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and the provisions of this Agreement.
ARTICLE XII SETTLEMENT OF DISPUTES BETWEEN ONE CONTRACTING PARTY AND NATIONAL OF THE OTHER CONTRACTING PARTY RELATING TO INVESTMENTS
1. In the event of a dispute between a Contracting Party and a
national of the other Contracting Party relating to an investment or an
activity associated with an investment, the parties to the dispute shall
initially seek to resolve the dispute by consultations and negotiations.
2. If the dispute has not been settled within three months from the
date either party gave notice in writing to the other concerning the
dispute, either party may take the following action:
(a) in accordance with the law of the Contracting Party which has
admitted the investment, initiate proceedings before its competent
judicial or administrative bodies; and
(b) where the parties agree or where the dispute relates to the
amount of compensation payable under Article VIII, submit the dispute to
an Arbitral Tribunal constituted in accordance with Annex A of this
Agreement.
3. The action referred to in paragraph 2 of this Article shall be
without prejudice to the right of the parties to seek assistance with
regard to the dispute from any competent government agency of the
Contracting Party which has admitted the investment.
4. In the event that both the People's Republic of China and
Australia become party to the 1965 Convention on the Settlement of
Investment Disputes Between States and Nationals of Other States, a
dispute may be submitted to the International Centre for the Settlement of
Investment Disputes for resolution in accordance with the terms on which
the Contracting Party which has admitted the investment is a party to the
Convention.
5. In any proceeding involving a dispute relating to an investment or
an activity associated with an investment, a Contracting Party shall not
assert, as a defence, counter-claim, right of set-off or otherwise, that
the national concerned has received or will receive, pursuant to an
insurance or guarantee contract, indemnification or other compensation for
all or part of any alleged loss. Nevertheless, a national of a Contracting
Party involved in such a dispute shall not be entitled to compensation for
more than the value, as determined in accordance with paragraph 2 of
Article VIII, of the investment which is the subject of the dispute,
taking into account all sources of compensation within the territory of
the Contracting Party liable to pay compensation.
ARTICLE XIII SETTLEMENT OF DISPUTES BETWEEN CONTRACTING PARTIES
1. The Contracting Parties shall consult when necessary on matters
concerning the operation of this Agreement.
2. The Contracting Parties shall endeavour to resolve any dispute
between them on the interpretation or application of this Agreement by
prompt and friendly negotiations and consultations. If a dispute is not
resolved by such means within sixty days of one Contracting Party seeking
in writing such negotiations or consultations, it shall be submitted at
the request of either Contracting Party to an Arbitral Tribunal
established in accordance with the provisions of Annex B of this
Agreement, or, by agreement, to any other international tribunal.
ARTICLE XIV ENTRY INTO FORCE, DURATION AND TERMINATION
1. This Agreement shall enter into force on signature. It shall
remain in force for a period of ten years and thereafter shall remain in
force indefinitely, unless terminated in accordance with paragraph 3 of
this Article.
2. This Agreement shall apply to investments made after 21 December
1972.
3. At the end of the first period of ten years referred to in
paragraph 1 of this Article and thereafter at any time either Contracting
Party may terminate this Agreement by giving one year's written notice to
the other Contracting Parties.
4. Notwithstanding its termination in accordance with paragraph 3 of
this Article, this Agreement shall continue to apply, for a further period
of ten years from the date of its termination, to investments made or
acquired prior to the date of its termination.
IN WITNESS WHEREOF the undersigned, being duly authorized thereto by
their respective Governments, have signed this Agreement.
DONE in duplicate at Beijing on the Eleventh day of July, 1988 in the
Chinese and English languages, both texts being equally authentic.
(Zheng Tuobin) (Bill Hayden)
FOR THE GOVERNMENT OF THE FOR THE
GOVERNMENT OF
PEOPLE'S REPUBLIC OF CHINA AUSTRALIA
ANNEX A
1. The Arbitral Tribunal referred to in paragraph 2 (b) of Article
XII shall consist of 3 persons appointed as follows: each party to the
dispute shall appoint one arbitrator; the arbitrators appointed by the
parties to the dispute shall, within 30 days of the appointment of the
last of their number, by agreement, select an arbitrator as Chairman who
is a national of a third country which has diplomatic relations with both
Contracting Parties.
2. If, within 60 days after a party has given notice in writing
instituting the arbitration proceedings, agreement has not been reached on
a Chairman of the Arbitral Tribunal, either party to the dispute may
request the President of the International Bank for Reconstruction and
Development to make the appointment.
3. If a party to the dispute, receiving notice in writing from the
other party of the institution of arbitration proceedings and the
appointment of an arbitrator, shall fail to appoint its arbitrator within
30 days of receiving notice from the other party, such arbitrator shall be
appointed by the Chairman of the Arbitral Tribunal after the Chairman is
appointed.
4. In case any arbitrator appointed as provided in this Annex shall
resign, die or otherwise become unable to perform his functions as an
arbitrator, a successor arbitrator shall be appointed in the same manner
as prescribed for the appointment of the original arbitrator and his
successor shall have all the powers and duties of the original arbitrator.
5. The Arbitral Tribunal shall, subject to the provisions of any
agreement between the parties to the dispute, determine its procedure by
reference to the rules of procedure contained in the 1965 Convention on
the Settlement of Investment Disputes Between States and Nationals of
Other States.
6. The Arbitral Tribunal shall decide all questions relating to its
competence.
7. Before the Arbitral Tribunal makes a decision it may at any stage
of the proceedings propose to the parties that the dispute be settled
amicably. The Arbitral Tribunal shall reach its award by majority vote
taking into account the provisions of this Agreement, any agreement
between the parties to the dispute and the relevant domestic law of the
Contracting Party which has admitted the investment.
8. An award shall be final and binding and shall be enforced in the
territory of each Contracting Party in accordance with its law.
9. Each party to the dispute shall bear the costs of its appointed
arbitrator. The cost of the Chairman and other expenses associated with
the conduct of the arbitration shall be borne equally by the parties.
ANNEX B
1. The Arbitral Tribunal referred to in Article XIII shall consist of
three persons appointed as follows: each Contracting Party shall appoint
one arbitrator, and a third arbitrator, who shall be a national of a
country with which both Contracting Parties maintain diplomatic relations,
shall be appointed by the agreement of the Contracting Parties. This third
arbitrator shall also act as "Chairman of the Tribunal".
2. Arbitration proceedings shall be instituted upon notice being
given through the diplomatic channel by the Contracting Party instituting
such proceedings to the other Contracting Party. Such notice shall contain
a statement setting forth in summary form the grounds of the claim, the
nature of the relief sought, and the name of the arbitrator appointed by
the Contracting Party instituting such proceedings. Within 60 days after
the giving of such notice the respondent Contracting Party shall notify
the Contracting Party instituting proceedings of the name of the
arbitrator appointed by the respondent Contracting Party.
3. If, within 60 days after the giving of notice instituting the
arbitration proceedings the Contracting Parties shall not be agreed upon a
Chairman of the Tribunal, either Contracting Party may request the
President of the International Court of Justice to make the appointment.
If the President is a national of either Contracting Party or is otherwise
unable to act, the Vice-President shall be invited to make the
appointment. If the Vice-President is a national of either Contracting
Party or is unable to act, the Member of the International Court of
Justice next in seniority who is not a national of either Contracting
Party shall be invited to make the appointment.
4. In case any arbitrator appointed as provided in this Annex shall
resign, die or otherwise become unable to act, a successor arbitrator
shall be appointed in the same manner as prescribed for the appointment of
the original arbitrator and his successor shall have all the powers and
duties of the original arbitrator.
5. The Arbitral Tribunal shall convene at such time and place as
shall be fixed by the Chairman of the Tribunal. Thereafter, the Arbitral
Tribunal shall determine where and when it shall sit.
6. The Arbitral Tribunal shall decide all questions relating to its
competence and shall, subject to any agreement between the Contracting
Parties, determine its own procedure.
7. Before the Arbitral Tribunal makes a decision, it may at any stage
of the proceedings propose to the Contracting Parties that the dispute be
settled amicably. The Arbitral Tribunal shall reach its award by majority
vote taking into account the provisions of this Agreement, the
international agreements both Contracting Parties have concluded and the
generally recognized principles of international law.
8. Each Contracting Party shall bear the costs of its appointed
arbitrator. The cost of the Chairman and other expenses associated with
the conduct of the arbitration shall be borne in equal parts by both
Contracting Parties.
9. The Arbitral Tribunal shall afford to the Contracting Parties a
fair hearing. It may render an award on the default of a Contracting
Party. Any award shall be rendered in writing and shall state its legal
basis. A signed counterpart of the award shall be transmitted to each
Contracting Party.
10. An award shall be final and binding on the Contracting Parties.
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