Communication from the Ministry of Foreign Affairs No. 41 / 1997 Coll.
Communication from the Ministry of Foreign Affairs on the negotiation of the Agreement between the Government of the Czech Republic and the Government of the Republic of Chile on mutual support and protection of investment
Valid
International Treaty
Effective from 05.10.1996
Text versions:
07.03.1997
41
COMMUNICATION
Ministry of Foreign Affairs
The Ministry of Foreign Affairs states that on 24 April 1995 the Agreement between the Government of the Czech Republic and the Government of the Republic of Chile on mutual support and protection of investment was signed in Prague.
The Parliament of the Czech Republic agreed to the Agreement and the President of the Republic ratified it.
The Agreement entered into force on 5 October 1996 on the basis of Article 12 (1) thereof.
The Czech version of the Agreement is hereby published at the same time. The English version of the Agreement, which is relevant for its interpretation, can be consulted by the Ministry of Foreign Affairs and the Ministry of Finance.
AGREEMENT
between the Government of the Czech Republic and the Government of the Republic of Chile
on mutual support and investment protection
the Government of the Czech Republic and the Government of the Republic of Chile (hereinafter referred to as the "Contracting Parties');
led by the desire to intensify economic cooperation to the mutual benefit of both countries;
intends to create and maintain favourable conditions for investments based initially on the transfer of assets, investors of one Contracting Party to the territory of the other Contracting Party;
Recognising that the mutual support and protection of such foreign investments supports the economic boom of both countries;
agree on the following:
Definitions
For the purpose of this Agreement:
(1) The term "investor" means the following persons who have made an investment in the territory of the other Contracting Party in accordance with the following Agreement:
(a) a natural person who, under the law of that Contracting Party, is considered to be a citizen of that Party;
(b) a legal person, including companies, companies and trade associations and other legally recognised legal persons, who are created or otherwise properly organised under the law of that Contracting Party and have their registered office in the territory of that same Contracting Party together with their actual economic activities.
(2) The term "investment" includes any asset value invested in connection with economic activities by an investor of one Contracting Party in the territory of the other Contracting Party in accordance with the law of the other Contracting Party and includes in particular, but not exclusively:
(a) movable and immovable property and any other property rights, such as encumbrance, mortgage, pledge or guarantee;
(b) shares, unsecured bonds or any other form of participation in companies;
(c) loans or other monetary claims or claims on any activity having an economic value and linked to the investment;
(d) intellectual and industrial property rights, including copyright, patents, trademarks, trade names, technical procedures, know- how and goodwill;
(e) rights arising from law or contract, including concessions for exploration, cultivation, extraction or exploitation of natural resources.
Any change in the form in which values are invested does not affect their character as investments.
(3) The term "territory" means the territory of the Czech Republic and the territory of the Republic of Chile, including territorial waters and any maritime or underwater area over which the Republic of Chile may exercise sovereign rights, in accordance with international law.
(4) The term "revenue" means the amounts resulting from the investment and includes in particular, but not exclusively, profits, interest, capital gains, shares, dividends, royalties or other charges.
Scope of application
The provisions of this Agreement shall apply to future investments made by investors of one Contracting Party in the territory of the other Contracting Party and to existing investments under the law of that Contracting Party at the date of entry into force of this Agreement. However, they shall not apply to disputes arising before its entry into force or to disputes which directly relate to events which occurred before its entry into force.
Aid and investment protection
(1) Each Contracting Party will, in accordance with its general economic policy in the field of foreign investment, promote investment by investors of the other Contracting Party and recognise such investment in accordance with its legislation.
(2) Each Contracting Party shall protect on its territory investments made in accordance with its law by investors of the other Contracting Party and shall not prejudice unjustified and discriminatory management, maintenance, use, possession, distribution, sale and disposal of such investments.
Treatment of investments
(1) Each Contracting Party shall grant fair and equitable treatment to investments made by investors of the other Contracting Party in its territory and shall ensure that the exercise of the right thus recognised is not impeded in practice.
(2) Each Contracting Party shall grant on its territory investment and investors' returns to the other Contracting Party treatment which is no less favourable than that which it grants to its own investors' investments and returns or to the investors' investments and returns of any third State which is most favourable.
(3) Each Contracting Party shall, in its territory, grant to investors of the other Contracting Party, treatment which is fair and fair and not less favourable than that accorded to investors of any third State as regards the management, maintenance, use, holding or handling of their investment.
(4) Where a Contracting Party grants specific advantages to investors of any third country by means of an agreement establishing a free trade zone, a customs union, a common market, an economic union or any other form of regional economic organisation to which the Contracting Party belongs, or through the provisions of the Agreement relating wholly or principally to taxation, it shall not be obliged to grant such advantages to investors of the other Contracting Party.
Free transfer
(1) Each Contracting Party shall guarantee the investors of the other Contracting Party the transfer of funds linked to the investment in freely convertible currency and without delay, in particular:
(a) interest, dividends, profits and other types of income;
(b) the amounts for repayment of the loan and loan in relation to the investment;
(c) any capital or proceeds from the sale or partial sale or liquidation of the investment;
(d) compensation for expropriation or loss, including any interest as referred to in Article 6 of this Agreement; and
(e) the earnings of employees who work in connection with the investment but are not citizens of the Contracting Party in whose territory the investment is made.
(2) Transfers shall be made at the prevailing rate on the transfer date established in accordance with the law of the Contracting Party where the investment was made.
(3) Transfers relating to investments made under the Chilean Foreign Debt Exchange Scheme for a share of assets shall be subject to specific rules.
(4) Capital may only be transferred one year after it has entered the territory of the Contracting Party if its legislation does not provide for more favourable treatment.
(5) The transfer shall be deemed to have been effected without delay if it has been carried out within a period normally required for the completion of the transfer formalities. That period shall begin on the date on which the application was submitted in due form and shall in no case exceed 30 days.
Expropriation and loss
(1) No Contracting Party shall take any measure depriving, directly or indirectly, the investor of the other Contracting Party of the investment if the following conditions are not met:
(a) the measures are taken in the public or national interest and in accordance with the law;
(b) the measures are not discriminatory;
(c) the measures shall be accompanied by provisions relating to the payment of an immediate, proportionate and effective refund.
(2) The compensation will be based on the market value of the investments concerned immediately before the measure became known to the public. Where this value cannot be ascertained promptly, the refund may be determined in accordance with generally accepted fair valuation principles. This compensation shall bear interest at the relevant market rate from the date of expropriation or loss to the date of payment.
(3) The investor concerned shall have the right of access, under the law of the expropriating Party, to the judicial authority of that Party in order to assess the amount of compensation and the legality of any such expropriation or comparable measure.
(4) Investors of one Contracting Party whose investments have suffered losses as a result of war or other armed conflict, revolution, exceptional situation or revolt taking place in the territory of the other Contracting Party shall be treated by the other Contracting Party as regards restitution, compensation, compensation or other settlement, no less favourable than that provided by that Contracting Party to its domestic investors or investors of any third country which is more favourable to the investors concerned.
(5) Notwithstanding paragraph 4 of this Article, investors of one Contracting Party who, at the events referred to in the preceding paragraph, suffer losses within the territory of the other Contracting Party consisting of:
(a) the seizure of their property by the armed forces or by the official authorities of the other Contracting Party; or
(b) destruction of their property by the armed forces or by the official authorities of the other Contracting Party, which was not caused by combat actions or was not caused by the necessity of the situation;
a fair and reasonable compensation shall be granted for damage suffered during the occupation or destruction of the property.
Transfer of rights
(1) Where one Contracting Party or the Agency authorised by a Contracting Party has provided contractual insurance or any other form of financial guarantee against non-commercial risks with respect to the investment of one of its investors in the territory of the other Contracting Party, the other Contracting Party shall recognise the rights of the first Contracting Party by means of the principle of the transfer of the rights of the investor when the payment was made under this Treaty or the financial guarantee by the first Contracting Party.
(2) Where a contracting party or its authorised agency has made a payment to its investor and has taken over the rights and rights of the investor, that investor shall not, unless authorised to act on behalf of the party making the payment, exercise those rights and rights against the other party.
(3) The transferred rights or rights shall not exceed the original rights or rights of the investor.
Settlement of disputes between a Party and an investor of the other Party
(1) Consultations between the Parties shall be held for the purpose of friendly resolution of disputes arising out of the terms of this Agreement between the Contracting Party and the investor of the other Contracting Party.
(2) If such consultation does not end with a decision within three months of the date of the request for a solution, the investor may bring the dispute either:
(a) the competent court of the Contracting Party in whose territory the investment was made; or
(b) the international arbitration of the International Investment Dispute Settlement Centre (ICSID), established by the Convention on the Settlement of Investment Disputes between States and citizens of other States, open for signature in Washington, D. C. 18 March 1965; or
(c) an arbitrator or an ad hoc international arbitration panel established under the arbitration rules of the United Nations International Trade Law Commission (UNCITRAL). The Parties in the dispute may agree in writing to amend these rules.
(3) Once the investor has submitted the dispute to the competent court of the Contracting Party in whose territory the investment has been made or to international arbitrage, this choice shall be final.
(4) For the purposes of this Article, any legal person created in accordance with the laws of one Contracting Party and in which, prior to the occurrence of a dispute, the majority of the shares are owned by investors of the other Contracting Party shall be considered, in accordance with Article 25 (2) (b) of that Washington Convention, as the legal person of the other Contracting Party.
(5) Arbitration decisions will be final and binding on both parties in the dispute and enforceable in accordance with the law of the Contracting Party in whose territory the investment was made.
(6) As soon as the dispute has been brought before the competent court or international arbitration in accordance with this Article, none of the Contracting Parties shall intervene in the dispute by diplomatic means if the other Contracting Party follows or submits to any judgment, arbitration decision, regulation or other decision taken by the competent international or local authority.
Consultation between Contracting Parties
The Parties shall consult, at the request of either Party, on matters relating to the interpretation or application of this Agreement.
Dispute settlement between Contracting Parties
(1) Disputes between the Contracting Parties concerning the interpretation or application of this Agreement shall, as far as possible, be settled by negotiation.
(2) If the dispute cannot be resolved within six months, it shall be submitted to the arbitration panel at the request of one of the Contracting Parties in accordance with the provisions of this Article.
(3) The arbitration panel shall consist of three members and shall be established as follows: within two months of notification by the Party to its wish to resolve the arbitration dispute, each Party shall appoint one arbitrator. These two members shall then agree, within 30 days of the appointment of the last of them, on a third member who shall be a citizen of a third country and shall act as President. The Contracting Parties shall appoint a Chairman within 30 days of the date of designation of the person concerned.
(4) If the necessary appointments have not been made within one of the time limits referred to in paragraph 3 of this Article, the President of the International Court of Justice may be asked to make the necessary appointments. If the President of the International Court of Justice is a citizen of a Contracting Party or if that person is unable to carry out this mandate, the appointment shall be made by a Vice-President. If the Vice-President is also a citizen of a Contracting Party or is unable to carry out this mandate, the appointment shall be made by the oldest member of the International Court of Justice who is not a citizen of any Contracting Party.
(5) The arbitration panel shall take its decision by a majority vote. Such a decision shall be final and binding. Each Party shall pay the costs of its arbitrator and of its representation in arbitration proceedings. The President's costs and other costs shall be borne by the Parties equally. The arbitration panel shall determine its own rules of procedure.
(6) The arbitration panel shall take its decisions taking into account the provisions of this Agreement, the principles of international law relating to the subject matter of the dispute and the generally recognised principles of international law.
Application of other provisions and specific commitments
(1) Where a question is addressed at the same time both by this Agreement and by any other international agreement to which both Contracting Parties are parties, nothing in this Agreement shall prevent any Contracting Party or any of its investors having investments in the territory of the other Contracting Party from making use of any rules which are more favourable to it.
(2) If the treatment to be granted by one Contracting Party to investors of the other Contracting Party in accordance with its laws or other specific contractual provisions is more favourable than that provided for in this Agreement, such favourable treatment shall be granted.
Final provisions
(1) The Contracting Parties shall notify each other of the fulfilment of the constitutional requirements for the entry into force of this Agreement. This Agreement shall enter into force 30 days after the date of subsequent notification.
(2) This Agreement shall remain in force for 15 years. It shall then remain in force without limitation until one of the Contracting Parties has given a one-year written statement through diplomatic channels.
(3) For investments made before the date on which the notification of termination of this Agreement becomes effective, the provisions of this Agreement shall remain in force for a further period of 15 years from that date.
(4) This Agreement shall be applicable whether diplomatic or consular relations exist between the Parties.
Done in duplicate in Prague on 24 April 1995 in Czech, Spanish and English, all texts being equally authentic. In the event of a conflict of interpretation, the English text will be decisive.
For the Government of the Czech Republic:
Ing. Ivan Kočárník CSc. v. r.
Deputy Prime Minister and Minister for Finance
For the Government of the Republic of Chile:
José Miguel Insulza v. r.
Minister for Foreign Affairs
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Regulation Information
| Citation | Communication from the Ministry of Foreign Affairs No. 41 / 1997 Coll., on the negotiation of the Agreement between the Government of the Czech Republic and the Government of the Republic of Chile on mutual support and protection of investment |
|---|---|
| Regulation Type | International Treaty |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 07.03.1997 |
|---|---|
| Effective from | 05.10.1996 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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