Communication from the Ministry of Foreign Affairs No. 43 / 1998 Coll.
Communication from the Ministry of Foreign Affairs on the negotiation of the Agreement between the Czech Republic and the Republic of India on the promotion and protection of investment
Valid
Effective from 06.02.1998
43
COMMUNICATION
Ministry of Foreign Affairs
The Ministry of Foreign Affairs announces that the Agreement between the Czech Republic and the Republic of India on the promotion and protection of investment was signed in Prague on 11 October 1996.
The Parliament of the Czech Republic agreed to the Agreement and the President of the Republic ratified it. The instruments of ratification were exchanged in Delhi on 6 February 1998.
The Agreement entered into force on 6 February 1998 pursuant to Article 15 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 Czech Republic and the Republic of India
on the promotion and protection of investment
the Czech Republic and the Republic of India (hereinafter referred to as the "Contracting Parties');
wishing to create favourable conditions to promote greater investment by investors of one State in the territory of the other State;
Recognising that the promotion and mutual protection of investment in accordance with this international agreement will contribute to stimulating individual business initiatives and increase wealth in both States;
agree on the following:
Definitions
For the purposes of this Agreement:
(a) The term "investor" shall mean any natural or legal person investing in the territory of the other Contracting Party.
(i) The term "natural person" means any natural person having the nationality of a Contracting Party in accordance with its law.
(ii) The term "legal person 'means, in respect of both Parties, any person, including a trading company, an undertaking or an association, which has its permanent registered office in the territory of one of the Parties and is registered or established in accordance with its legal order and recognised as a legal person.
(b) "investment" shall mean any asset value established or acquired in conjunction with economic activities by an investor of one Contracting Party in the territory of the other Contracting Party, including changes in the form of an investment, in accordance with the law of the Contracting Party in whose territory the investment is located, and shall include in particular, but not exclusively:
(i) movable and immovable property, as well as other rights such as mortgages, collateral or guarantees;
(ii) shares, bonds and unsecured bonds of companies and any other similar forms of participation in the company;
(iii) cash claims or claims on any performance from a contractual arrangement having a financial value associated with the investment;
(iv) intellectual property rights, goodwill, technical procedures and know-how in accordance with the relevant legislation of the Contracting Party;
(v) rights arising from trade concessions and licences under the law, including concessions for exploration and extraction of oil and other minerals.
(c) "Income" shall mean cash amounts resulting from an investment such as profits, interest, capital gains, dividends, royalties or other charges.
(d) "Territory" means:
(i) having regard to the Czech Republic: the territory of the Czech Republic in which the Czech Republic exercises sovereign rights and jurisdiction in accordance with international law;
(ii) with regard to India: the territory of the Republic of India, including coastal waters and airspace and other sea areas including the exclusive economic zone and the continental shelf over which the Republic of India has sovereignty, sovereign rights or exclusive jurisdiction in accordance with its applicable law and the United Nations Convention on the Law of the Sea and International Law, 1982.
Aid and investment protection
(1) Each Contracting Party shall promote and create favourable conditions for investors of the other Contracting Party to invest in its territory and shall recognise such investments in accordance with its legal order and the relevant framework established by its Government.
(2) Under all circumstances, the investors' investments and returns shall be granted due and fair treatment and shall enjoy full protection and security in the territory of the other Contracting Party.
National treatment and most favoured nation clause
(1) Each Contracting Party shall provide the investment of investors of the other Party, including their operations, management, maintenance, use, use or disposal by such investors, treatment not less favourable than that provided by its own investors or by investors of any third State.
(2) In addition, each Contracting Party shall provide investors of the other Contracting Party with treatment no less favourable than that accorded to investors of any third State.
(3) The provisions of paragraphs 1 and 2 of this Article cannot be interpreted by obliging one Contracting Party to grant to investors of the other Contracting Party such treatment, advantage or privilege resulting from:
(a) the customs union or free trade zone or monetary union or similar international agreements leading to such Union or institutions or other forms of regional cooperation, the Contracting Party of which is or may be a member;
(b) any matter relating wholly or principally to taxation.
Expropriation
(1) Investment by investors of one or the other Contracting Party will not be nationalised, expropriated or subject to measures having a similar effect to that of nationalisation or expropriation ("expropriation") in the territory of the other Contracting Party, with the exception of expropriation in the public interest, by law, on a non-discriminatory basis and against proper and fair compensation. Such compensation will be equal to the value of the expropriated investment immediately before the expropriation or before the intended expropriation has become known to the public, whichever is the earlier, it will include interest in a correct and fair amount by the date of payment of the refund, will be effected without undue delay, will be immediately feasible and freely transferable in a freely convertible currency.
(2) The investor concerned shall have the right to request, in accordance with the law of the Contracting Party which expropriated the investment, a review of its case and an evaluation of its investment by a judicial or other independent body of the Contracting Party in accordance with the principles contained in this Article. The Contracting Party which executes the expropriation shall make every effort to ensure that the review procedure is carried out immediately.
(3) Where a Contracting Party earns the assets of a company which is registered or established in accordance with the law applicable in any part of its territory and in which investors of the other Contracting Party own shares, the Contracting Party shall ensure that the provisions of paragraph 1 of this Article apply to those investors with regard to their investment, to the extent necessary to ensure proper and fair compensation.
Compensation for damage
(1) Investors of one Contracting Party whose investment in the territory of the other Contracting Party will suffer damage as a result of war or other armed conflict, exceptional situation or civil unrest or other similar events in the territory of the other Contracting Party shall be treated no less favourably than that which it grants to its own investors or investors of any third State. The resulting payments will be freely transferable in freely convertible currency.
(2) Notwithstanding paragraph 1 of this Article, investors of one Contracting Party who have suffered damage in the territory of the other Contracting Party in any of the events referred to in the preceding paragraph shall:
(a) seizure of their property by the armed forces or 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 restitution or fair and reasonable compensation for damage suffered during the occupation or as a result of the destruction of property. The resulting payments shall be freely transferable in freely convertible currency without delay.
Transfers of investments and revenues
(1) Each Contracting Party shall ensure the free transfer of all funds of the investor of the other Contracting Party linked to the investment and revenues in its territory without undue delay and on a non-discriminatory basis. These funds include, for example:
(a) capital and additional amounts to maintain and increase investments;
(b) net operating profits after tax, including dividends and interest, to an extent equivalent to a share in the company, royalties and any other income;
(c) the amounts payable, including interest on loans relating to the investment;
(d) the proceeds received by the investor from the sale or partial sale or liquidation of the investment;
(e) the income of State citizens of one Contracting Party who work in relation to an investment in the territory of the other Contracting Party.
(2) Nothing in paragraph 1 of this Article shall affect the transfer of any refund under Article 5 of this Agreement.
(3) Unless otherwise agreed by the Parties, the transfer of payments referred to in paragraph 1 of this Article shall take place in the currency of the original investment or in any other freely convertible currency. The transfer of payments will take place on the basis of the conversion rate, which is the prevailing market rate valid at the date of the transfer.
Transfer of rights
Where a Contracting Party or its authorised Agency has guaranteed compensation against non-commercial risks relating to the investment of any of its investors in the territory of the other Contracting Party and has made payments to such investors in respect of their claims under this Agreement, the other Contracting Party shall agree that the Contracting Party or its authorised Agency is entitled to exercise the rights and exercise the rights of such investors by way of transfer. The transferred rights or claims shall not exceed the degree of original rights or rights of investors.
Dispute settlement between an investor and a party
(1) Any dispute between an investor of one Contracting Party and the other concerning an investor's investment under this Agreement shall be dealt with, where possible, by friendly negotiations between the parties to the dispute.
(2) If such a dispute has not been amicably resolved within six months of the written notification of the claim, it may be referred to the decision:
in accordance with the law of the Contracting Party which has admitted the investment, the competent judicial, administrative or arbitral body whose final decision will be binding;
or alternatively according to one of the following procedures:
(a) international conciliation procedures in accordance with the United Nations International Trade Law Commission's Rules of Conciliation;
(b) the International Investment Dispute Settlement Centre where the investor party and the other party are both members of the Investment Dispute Settlement Convention between States and citizens of other States, 1965;
(c) an ad hoc arbitration panel by one of the parties to the dispute in accordance with the arbitration rules of the United Nations International Trade Law Commission, 1976, as amended by:
(i) The Appointment Authority pursuant to Article 7 of these Rules shall be the President, Vice-President or Senior Officer of the International Court of Justice, who is not a citizen of any Contracting Party. The third arbitrator shall not be a citizen of any of the Contracting Parties.
(ii) The Parties shall appoint their arbitrators within two months.
(iii) The arbitration panel shall state on what basis it has decided and, at the request of either Party, shall give reasons for the decision.
(3) The arbitration finding will be final and binding.
Dispute settlement between Contracting Parties
(1) Disputes between the Contracting Parties concerning the interpretation or application of this Agreement should, where possible, be resolved by negotiations and consultations.
(2) If the dispute cannot be resolved in this way within six months of its inception, it shall be submitted to the arbitration panel at the request of one of the Contracting Parties.
(3) The arbitration panel shall be established on a case-by-case basis as follows: Each Party shall designate one arbitrator within two months of receipt of the request for arbitration. The two arbitrators shall then select a citizen of a third State who, with the agreement of the two Parties, will be appointed President of the Court. The President shall be appointed within two months of the date of appointment of the two arbitrators.
(4) If the necessary appointments have not been made within one of the time limits referred to in paragraph 3 of this Article, any Contracting Party may, unless agreed otherwise, invite the President of the International Court of Justice to make the necessary appointments. If the President is a citizen of a Contracting Party or for any other reason is unable to carry out this act, the Vice-President shall be requested to be appointed. If the Vice-President is also a citizen of a Contracting Party or is unable to carry out this act, the oldest member of the International Court of Justice who is not a citizen of any Contracting Party shall be requested to make the necessary appointment.
(5) The arbitration panel shall take its decision by a majority vote. Such a decision shall be binding on both Parties. Each Party shall pay only the costs of its arbitrator and its participation in the arbitration procedure; the costs of the Chair and the remaining expenses shall be borne equally by the Parties. The arbitration panel may, by its decision, determine that a higher proportion of the costs shall be reimbursed by one of the Contracting Parties and shall be binding on both Contracting Parties. The arbitration panel shall determine its own rules of procedure.
Entry and residence of staff
The Contracting Party, in accordance with its applicable laws applicable to the entry and residence of foreign nationals, shall authorise the natural persons and employees of the companies of the other Contracting Party to enter and remain in its territory for the purpose of carrying out employment in investment related activities.
Application of legislation
Unless otherwise agreed in this Agreement, all investments shall be governed by the law applicable in the territory of the Contracting Party in whose territory such investments are made.
Exceptions
The provisions of this Agreement shall not in any way restrict the right of a Contracting Party to take action, in accordance with its legal order, in good faith and on a non-discriminatory basis, to the extent and duration necessary to protect its essential safety interests or to prevent diseases and diseases of animals or plants.
Scope of the Agreement
This Agreement shall apply to all investments made by investors of one Contracting Party in the territory of the other Contracting Party, admitted in accordance with its law, whether or not they were made before or after the entry into force of this Agreement. The provisions of this Agreement shall not apply to any dispute, claim or dispute arising before the entry into force of this Agreement.
Application of other provisions
Where the provisions of the Contracting Party's legal order or obligations arising from international law existing at present or established in the future between the Contracting Parties, outside this Agreement, contain rules, general or specific, authorising investors of the Contracting Party to invest in more favourable treatment than that provided for under this Agreement, those rules shall prevail over this Agreement to the extent that they are more favourable.
Entry into force
This Agreement shall be subject to ratification and shall enter into force on the date of the exchange of instruments of ratification.
Duration and termination
(1) This Agreement shall remain in force for a period of 10 years and shall then be deemed to be automatically extended unless one of the Contracting Parties notifies the other Contracting Party in writing of its intention to terminate the Agreement. The Agreement shall expire one year after the date of receipt of the written notification.
(2) Notwithstanding the termination of this Agreement pursuant to paragraph 1 of this Article, the Agreement will remain effective for a further period of 15 years from the date of its expiry in respect of investments made or acquired before the date of expiry of this Agreement.
In order to prove the signature below, duly authorised, they signed this agreement.
Dane in Prague on 11 October 1996 in two copies in Czech, Hindi and English, all texts equally authentic. In the event of any discrepancy, the English version is decisive.
For the Czech Republic:
Ing. Ivan Kočárník, CSc.
Deputy Prime Minister and Minister for Finance
For the Republic of India
Bolla Buli Ramayah v. r.
State Minister for Trade
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Regulation Information
| Citation | Communication from the Ministry of Foreign Affairs No. 43 / 1998 Coll., on the negotiation of the Agreement between the Czech Republic and the Republic of India on the promotion and protection of investment |
|---|---|
| Regulation Type | - |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 13.03.1998 |
|---|---|
| Effective from | 06.02.1998 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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