AGREEMENT
AMONG THE GOVERNMENT OF
BRUNEI DARUSSALAM,
THE REPUBLIC OF INDONESIA,
MALAYSIA, THE REPUBLIC OF
THE PHILIPPINES, THE REPUBLIC
OF SINGAPORE, AND THE KINGDOM OF THAILAND
FOR THE PROMOTION AND PROTECTION OF INVESTMENTS
Manila, 15 December 1987
The Governments of Brunei Darussalam, the
Republic of Indonesia, Malaysia, the Republic of
the Philippines, the Republic of Singapore, and
the Kingdom of Thailand, hereinafter referred to
as the Contracting Parties;
CONSIDERING that the Heads of Government
of ASEAN agreed inter alia on industrial co-
operation among the, member states of ASEAN in
the Declaration of ASEAN Concord signed at
Denpansar, Bali on 24 February 1976;
FURTHER CONSIDERING that the Heads of
Government of ASEAN in their Meeting in Kuala
Lumpur on 4 to 5 August 1977, recognized inter
alia that the acceleration of industrialization of
the region requires the increased flow of technology
and investments, and toward the attainment
of this common objective, directed that measures
be taken to stimulate the flow of technology,
knowhow and private investments among the
member states. and directed, in particular, the
study of a regional mechanism, and the
formulation of guidelines, which would facilitate
such desired flow of technology, knowhow and
private investments;
DESIRING that appropriate measures be
taken to carry out the foregoing intents and to
create favourable -conditions for investments by
nationals and companies of any ASEAN member
state in the territory of the other ASEAN
member states and to facilitate the desired flow
of private investments therein to increase
prosperity in their respective territories;
RECOGNIZING that an agreement on the
promotion and protection of such investments
will contribute to the furtherance of the above
mentioned purposes;
HAVE AGREED AS FOLLONYS:
Article I
DEFINITIOIN
For the purpose of this Agreement:
- The term "nationals" shall be as defined in
the respective Constitutions and laws of each of
the Contracting Parties.
- The term "company" of a Contracting
Party shall mean a corporation, partnership or
other business association, incorporated or
constituted under the laws in force in the
territory of any Contracting Party wherein the
place of effective management is situated.
- The term "investment" shall mean every
kind of asset and in particular shall include,
though not exclusively:
a) movable and immovable property and
any other proper rights such as
mortages, liens and pledges;
b) shares, stooks and debentures of
companies or interests in the property of
such companies;
c) claims to money or to any performed
under contract having a financial value;
d) intellectual property rights and goodwill;
e) business concessions conferred by law or
under contract, including concessions to
search for, cultivative, extract, or exploit
natural resources.
- The term "earnings" shall mean amounts
yielded by an investment, particularly, though
not exclusively, profits, interest, capital gains,
dividends, royalties or fees.
- The term "freely usable currency" shall
mean the United States Dollar, Pound Sterling,
Deutschmark French Franc, Japanese Yen, or
any other currency that is widely used to make
payments for international transactions and is
widely traded in the principal exchange-markets.
- The term "host country" shall mean the
Contracting Party wherein the investment is
made.
Article II
APPLICABILITY OR SCOPE
- This Agreement shall apply only to investments
brought into, derived from or directly
connected with investments brought into the
territory of any Contracting Party by nationals or
companies of any other Contracting Party and
which are specifically approved in writing and
registered by the host country and upon such
conditions as it deems fit for the purposes of this
Agreement.
- This Agreement shall not affect the, rights
and obligations of the Contracting, Parties with
respect to investments which, under the
provisions of paragraph 1 of this Article, do not
fall within the scope of the Agreement.
- This Agreement shall also apply to investments
made prior to its entry into force, provided
such investments are specifically approved in
writing and registered by the host country and
upon such-conditions as it deems fit for purpose
of this Agreement subsequent in its entry into
force.
Article III
GENERAL OBLIGATIONS
- Each Contracting Party shall, in a manner
consistent with it national objectives, encourage
and create favourable conditions in its territory
for investments from the other Contracting
Parties. All investments to which this Agreement
relates shall, subject to this Agreement, be
governed by the laws and regulations of the host
country, including rules of registration and
valuation of such investments.
- Investments of nationals or companies of
and obligations Party in the territory of other
Contracting Parties shall at all times be accorded
fair and equitable treatment and shall enjoy full
protection and in the territory of the
host country.
- Each Contracting Party shall observe any
obligation arising from a particular commitment
it may have entered into Title with regard to a specific
investment of nationals or companies of the other
Contracting Parties.
Article IV
TREATMENT
- Each Contracting Party shall, within its
territory ensure full protection of the investments
made in accordance with its legislation by
investors of the other Contracting Parties and
shall not impair by unjustified or discriminatory
measures the management, maintenance, use,
enjoyment, extension, disposition or liquidation
of such investments.
- All investments made by investors of any
Contracting Party shall enjoy fair and equitable
treatment in the territory of any other
Contracting Party. This treatment shall be no less
favourable than that granted to investor of the
most-favoured- nation.
- Investor of any Contracting Party who
within the territory of another Contracting Party
suffer damages in relation to their investment
activities - in connection with their investments,
owing to the outbreak of hostilities or a state of
national emergency, shall be accorded treatment
no less favourable than that accorded to investors
of any - third country, as regards restitution,
compensation or other valuable consideration
Payments made under this provision shall be
effectively realizable and freely transferable,
subject to Article VII.
- Any two or more of the Contracting Parties
may negotiate to accord national treatment
within the framework of this Agreement. Nothing
herein shall entitle any other party to claim
national treatment under the most-favoured-nation principle.
Article V
EXCEPTION
The Provision of this Agreement shall not
apply to matters of taxation in the territory of
the Contracting Parties. Such matters shall be
governed by Avoidance of Double Taxation
between Contracting Parties and the domestic
laws of each Contracting Party.
Article VI
EXPROPRIATION AND COINIPENSATION
- Investments of nationals or companies of
any Contracting Party shall not be subject to
expropriation nationalisation or any measure
equivalent thereto (in the article referred to as
"expropriation"), except for public use, or public
purpose, or in the public interest, and-under due
process of law, on a non-discriminatory basis and
upon payment of adequate compensation. Such
compensation shall amount to the market value
of the investments affected, immediately before
the measure of dispossession became public
knowledge and it shall be freely transferable in
freely-usable currencies from the host country.
The compensation shall be settled and paid
without unreasonable delay. The national or
company affected shall have the right, under the
law of Contracting Party making the expropriation,
to prompt review by a judicial body or some
other independent authority of that Contracting
Party in accordance with principles set out in this
paragraph.
- Where a Contracting Party expropriates the
assets of a company which is incorporated or
constituted under the law in force in its territory,
and in which nationals or companies of another
Contracting Party own shares, it shall apply the
provisions of paragraph 1 of this Article so as to
ensure the compensation provided for in that
Paragraph to such nationals or companies to the
extend of their interest in the assets expropriated.
Article VII
REPATRIATION OF CAPITAL
AND EARNINGS
- Each Contracting Party shall, subject to its
laws, rules and regulations, allow without unreasonable
delay the free transfer in any freely-
usable currency of:
a) the capital, net profits, dividends,
royalties, technical assistance and technical
fees, interests and other income,
accruing from any investments of the
nationals or companies of the other
Contracting Parties;
b) the proceeds from the total or partial
liquidation of any investments made by
nationals or companies of the other
Contracting Parties;
c) funds in repayment of loans given by
nationals or companies of one
Contracting Party to the nationals or
companies of another Contracting Party
which both Contracting Parties have
recognized as investments:
d) the earnings of nationals of the. other
Contracting Parties who are employed
and allowed to work in connection with
an investment in its territory.
- The exchange rate applicable to such
transfer shall be the rate of exchange prevailing at
the time of remittance.
- The Contracting Parties undertake to
accord to transfers referred to in paragraph (1) of
this Article a treatment no less favourable than
that accorded to transfer originating from investments
made by nationals or companies of any
third State.
Article VIII
SUBROGATION
If any of the Contracting Parties makes
payment to any .of its nationals or companies
under a guarantee it has granted in respect of an
investment made in the territory of another Contracting
Party, the latter Contracting Party shall,
without prejudice to the rights of the former
Contracting Party under Article IX and X,
recognize the assignment of any right title or
claim of such national or company to the former
Contracting Party and the subrogation of the
former Contracting Party to any such right, title
or claim. This, however, does not necessarily
imply a recognition on the part of the latter
Contracting Party of the merits of any case or the
amount of any claim arising therefrom.
Article IX
DISPUTE BETREEN THE
CONTRACTING PARTIES
- Any dispute between and among, the
Contracting Parties concerning the interpretation
or application of this Agreement shall, as far as
possible, be settled amicably between the parties
to the dispute. Such settlement shall be reported
to the ASEAN Economic Ministers (AEM).
- If such a dispute cannot thus be settled it
shall be submitted to the AEM for resolution.
Article X
ARBITRATION
- Any legal dispute arising directly out of an
investment between any Contracting Party and a
national or company of any of the other
Contracting Parties shall, as far as possible, be
settled amicably between the parties to the
dispute.
- If such a dispute cannot thus be settled
within six months of its being raised, then either
party can elect to submit the dispute for conciliation
or arbitration and such election shall be
binding on the other party. The dispute may be
brought before the International Centre for
Settlement of Investment Disputes (IGSID), the
United Nations Commission on International
Trade Law (UNCITRAL), the Regional Centre for
Arbitration at Kuala Lumpur or any other
regional centre for arbitration in ASEAN,
whichever body the parties to the dispute
mutually agree to appoint for the purposes of
Conducting the arbitration.
- In the event that the parties cannot agree
within a period of three months on a suitable
body for arbitration, an arbitral tribunal
consisting of three members shall be formed. The
Parties to the dispute shall appoint one member
each, and these two members shall then select a
national of a third Contracting Party to be the
chairman of the tribunal, subject to the approval
of the parties to the dispute. The appointment of
the members and the chairman shall be made
within two months and three months
respectively, from the date a decision to form
such an arbitral tribunal is made.
- If the arbitral tribunal is not formed in the
periods specified in paragraph 3 above, then
earlier party to the dispute may, in the absence of
any other relevant arrangement request the
President of the International Court of Justice to
make the required appointments.
- The arbitral tribunal shall reach its
decisions by a majority of votes and its decisions
shall be binding, The Parties involved in the
dispute shall bear the cost of their respective
members to the arbitral tribunal and share equally
the cost of the chairman and other relevant costs.
In all other respects, the arbitral tribunal shall
determine its own procedures.
Article XI
CONSULTATION
The Contracting Parties agree to consult each
other at the request of any Party on any matter
relating to investments covered by this
Agreement, or otherwise affecting the implementation
of this Agreement.
Article XII
AMENDMENTS
All articles of this Agreement may be
modified through amendments in writing to this
Agreement agreed upon by consensus. All
amendments shall become effective upon
acceptance by all Contracting Parties.
Article XIII
ENTRY INTO FORCE
- This Agreement shall enter into force on
the 30th day after the deposit of the sixth
Instrument of Ratification and shall thereafter
remain in force for a period of the years.
- This Agreement shall thereafter continue in force
unless terminated by any Contracting Party giving
not less than six months written notice through
diplomatic channels. Provided however, that in
respect of investments made while the Agreement
was in force, its provisions shall continue in effect
with respect to such investments for a period of ten years
after the date of termination, and without prejudice to
the application thereafter of the rules of international law.
Article XIV
MISCELLANEOUS PROVISIONS
- This Agreement may not be signed with reservation
nor shall reservations be admitted at the time of ratification.
- This Agreement shall be deposited with the
Secretary-General of the ASEAN Secretariat who
shall promptly furnish a certified copy thereof
to each Contracting Party.
- Each Contracting Party shall deposit its instrument
of Ratification with Secretary-General of the ASEAN
Secretariat who shall promptly inform each Contracting
Party of such deposit.
IN WITNESS WHEREOF, the undersigned, duly
authorized thereto by their respective Governments, have
signed this Agreement.
DONE in Manila, Philippines this Fifteenth day of
December Nineteen Hundred Eighty Seven in one
original copy in the English Language.