The model
BIT also confers protection from unlawful interference of property
interests and assures compensation in accordance with international law
standards. It provides that any direct or indirect taking must be: for a
public purpose; nondiscriminatory; accompanied by the payment of prompt,
adequate and effective compensation; and in accordance with due process
of law and the general standards of treatment discussed above. The BIT's
definition of "expropriation" is broad and flexible;
essentially "any measure" regardless of form, which has the
effect of depriving an investor of his management, control or economic
value in a project can constitute expropriation requiring compensation
equal to the "fair market value." Such compensation, which "shall
not reflect any reduction, in such fair market value due to . . . the
expropriatory action," must be "without delay," "effectively
realizable," "freely transferable" and "bear current
interest from the date of the expropriation at a rate equal to current
inter national rates." The BIT grants the right to "prompt
review" by the relevant judicial or administrative authorities in
order to determine whether the compensation offered is consistent with
these principles. It also extends national and MFN treatment to
investors in cases of loss due to war or other civil disturbance. The
BIT does not provide, however, a specific valuation method of
compensating such losses.
The model
BIT provides for free transfers "related to an investment,"
specifically of returns, compensation for expropriation, contract
payments, proceeds from sale, and contributions to capital for
maintenance or development of an investment. Such transfers are to be
made in a "freely convertible currency at the prevailing market
rate of exchange on the date of transfer with respect to spot
transactions in the currency to be transferred." The model text
recognizes that notwithstanding this guarantee Parties can maintain
certain laws and regulations regarding transfers provided these are
applied in non-discriminatory fashion. In particular, the model BIT
provides that Parties can require reports of currency transfers and
impose income taxes by such means as a withholding tax on dividends.
The model
BIT provides that where certain defined investment disputes arise
between a Party and a national or company of the other Party, including
disputes to the interpretation of an investment agreement, and the
dispute cannot be solved through negotiation, it may be submitted to
arbitration in accordance with any dispute-settlement procedures to
which the national or company previously agreed. Unless the national or
company has submitted the dispute to previously agreed dispute
settlement procedures or to adjudication by domestic courts or other
tribunals of the host country, the national or company may submit the
dispute to the International Centre for the Settlement of Investment
Disputes ("ICSID"). Exhaustion of local remedies is not
required. In a separate provision, the BIT Parties also agree to grant
nationals and companies of the other Party access to their domestic
courts in order to assert claims and enforces rights with respect to
investments.
The model
BIT provides for state-to-state arbitration between the Parties in case
of a dispute regarding the interpretation or application of the treaty.
In the absence of an agreement that other rules apply, the BIT refers
the Parties to specific procedural rules which must govern the
arbitration. The BIT also outlines the procedures for the creation of
the arbitral panel.
The model
BIT exhorts Parties to apply their tax policies fairly and equitably.
Because the United States specifically addresses tax matters in tax
treaties, the BIT generally excludes such matters. It also specifically
limits the arbitration provisions to only certain taxation matters.
Another BIT provision exempts disputes arising under Export-Import Bank
programs or other credit, guarantee or insurance arrangements, providing
for alternative dispute settlement arrangements, from the standard BIT
arbitration clauses. The model BIT also states that the treaty shall not
derogate from any obligations that require more favorable treatment of
investments and declares that the treaty shall not preclude measures
necessary for public order or essential security interests. The model
BIT enters into force 30 days after exchange of ratifications and
continues in force for at least ten years. Thereafter, either Party may
terminate the treaty, subject to one year's written notice.
Each of
these model provisions was developed after lengthy and extensive
consultations within the U.S. Government and with the private sector.
Nonetheless, in negotiating a particular treaty, the U.S. Government
retains, of course, some flexibility to adopt modifications as necessary
and in light of experience. While the U.S. model text has recently been
simplified, the provisions summarized above have all been retained.
Some
provisions of the treaty with Senegal differ in minor respects from the
U.S. model text. The more significant of these are as follows:
(1)
Employment. - The model text's subparagraph on employment has been
broken out into a new paragraph (Article II, paragraph 6) to separate
that topic from "entry and sojourn". Two Protocol paragraphs
with respect to employment have been included in the Protocol
(paragraphs 1 and 2) which (1) make clear that employment rights do not
confer rights to entry or sojourn except as provided by national law;
and (2) recognize that employment by U.S. companies or nationals in
Senegal of Senegalese nationals whose qualifications are equal or
superior to those of other applicants would contribute to the economic
and social development objectives of Senegal. These modifications in no
way restrict the investors' right to hire managerial, technical and
professional personnel of their choice.
(2)
Performance requirements. - Paragraph 3 of the Protocol recognizes that
local purchase of goods and services can contribute to the economic
objectives of the parties where such goods and services are available
under equal or better conditions of price, quality and delivery time as
compared to competitive goods and services, and where such purchase is
otherwise consistent with the requirements of economic efficiency. This
assertion does not detract from the treaty's prohibition against
performance requirements. (3) Compensation upon expropriation. -
Paragraph 4 of the Protocol to the Senegal treaty defines "without
delay" so as to permit "prompt completion of all necessary
formalities." A "commercially reasonable rate" of
interest for Senegal is defined as the discount rate established by the
Central Bank of West African States. Neither definition represents a
departure from international law standards of compensation for
expropriation.
(4)
Consultation. - A paragraph (Article VI, paragraph 3) has been added
calling for biennial consultations between the Parties concerning the
status and application of the treaty. (6) Settlement of disputes between
an investor and a Party. - Paragraph 5 in the Protocol states that if
such a dispute arises when a Party is no longer an ICSID member, the
Additional Facility of ICSID shall be used. The Additional Facility does
not require that Governments party to a dispute be ICSID members. The
United States has supported the Additional Facility as an acceptable
alternative in such cases.
(6)
Amendments. - Although the U.S. model text contains no provisions for
amendment, at Senegal's request, the treaty contains a paragraph
(Article XIII , paragraph 3) which provides for amendment by agreement
of the parties. (7) Exemptions from coverage. - In the Annex to the
treaty Senegal exempts from coverage small- and medium-sized enterprises
as specified under its local law.
None of
these modifications from the U.S. model text represent substantive
departures from U.S. objectives.
Submission of this treaty, together with the other five noted above,
marks a significant development in our international investment policy.
I join with the United States Trade Representative and other U.S.
Government agencies in supporting these treaties and favor their
approval by the Senate at an early date.
Respectfully submitted,
GEORGE P.
SHULTZ.
TREATY
BETWEEN THE UNITED SRATES OF AMERICA AND THE REPUBLIC OF SENEGAL
CONCERNING THE RECIPROCAL ENCOURAGEMENT AND PROTECTION OF INVESTMENT
The United
States of America and The Republic of Senegal (each hereinafter referred
to as a "Party"),
Desiring
to promote greater economic cooperation between them, particularly with
respect to investment by nationals and companies of one Party in the
territory of the other Party, and
Recognizing that agreement upon the treatment to be accorded such
investment will stimulate the flow of private capital and the economic
development of both Parties, and
Agreeing
that discrimination on the basis of nationality by either Party against
investment in its territory by nationals or companies of the other Party
is not consistent with either a stable framework for investment or a
maximum effective utilization of economic resources,
Have
resolved to conclude a treaty concerning the encouragement and
reciprocal protection of investment, and
Have
agreed as follows:
ARTICLE
I
DEFINITIONS
For the
purposes of this Treaty:
(a) "Company"
means any kind of juridical entity, including any corporation, company,
association, or other organization, that is duly incorporated,
constituted, or otherwise duly organized, regardless of whether or not
the entity is organized for pecuniary gain, privately or governmentally
owned, or organized with limited or unlimited liability.
(b) "Company
of a Party" means a company duly incorporated, constituted, or
otherwise duly organized under the all applicable laws and regulations
of a Party or a political subdivision thereof in which
(i)
natural persons who are nationals of such Party, or
(ii) such
Party or a political subdivision thereof or their agencies or
instrumentalities have a substantial interest as determined by such
Party.
The
juridical status of a company of a Party shall be recognized by the
other Party and its political subdivisions. Each Party reserves the
right to deny to any of its own companies or to a company of the other
Party the advantages of this Treaty if nationals of any third country
control such company. provided that, whenever one Party concludes that
the benefits of this Treaty should not be extended to a company of the
other Party for this reason, it shall promptly consult with the other
Party to seek a mutually satisfactory resolution of the matter. This
right shall not apply with respect to recognition of juridical status
and access to courts.
(c) "Investment"
means every kind of investment, owned or controlled directly or
indirectly, including equity, debt, and service and investment
contracts; 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, and
associated with an investment;
(iv)
intellectual and industrial property rights, including rights with
respect to copyrights, patents, trademarks, trade names, industrial
designs, trade secrets and know-how, and goodwill;
(v)
licenses and permits issued pursuant to law, including those issued for
manufacture and sale of products;
(vi) any
right conferred by law or contract, including rights to search for or
utilize natural resources, and rights to manufacture, use and sell
products; and
(vii)
returns which are reinvested.
Any
alteration of the form in which assets are invested or reinvested shall
not affect their character as investment. (d) "Own or control"
means ownership or control that is direct or indirect, including
ownership or control exercised through subsidiaries or affiliates,
wherever located. (e) "National" of a Party means a natural
person who is a national of a Party under its applicable law. (f) "Return"
means an amount derived from or associated with an investment, including
profit; dividend; interest; capital gain; royalty payment; management,
technical assistance or other fee; and payment in kind.
ARTICLE
II
TREATMENT
OF INVESTMENT
1. Each
Party shall endeavor to maintain a favorable environment for investments
in its territory by nationals and companies of the other Party and shall
permit such investments to be established and acquired on terms and
conditions that accord treatment no less favorable than the treatment it
accords in like situations to investments of its own nationals or
companies, and no less favorable than the treatment it accords in like
situations to investments of nationals or companies of any third
country.
2. Each
Party shall accord existing or new investments in its territory of
nationals or companies of the other Party, and associated activities,
treatment no less favorable than that which it accords in like
situations to investments and associated activities of its own nationals
or companies, and no less favorable than that which it accords in like
situations to investments and associated activities of nationals or
companies of any third country. Associated activities include:
(a) the
establishment, control and maintenance of branches, agencies, offices,
factories or other facilities for the conduct of business;
(b) the
organization of companies under applicable laws and regulations; the
acquisition of companies or interests in companies or in their property;
and the management, control, maintenance, use, enjoyment and expansion,
and the sale, liquidation, dissolution or other disposition, of
companies organized or acquired;
(c) the
making, performance and enforcement of contracts;
(d) the
acquisition (whether by purchase, lease or otherwise),ownership and
disposition (whether by sale, testament or otherwise), of personal
property of all kinds, both tangible and intangible;
(e) the
leasing of real property appropriate for the conduct of business;
(f) the
acquisition, maintenance and protection of copyrights, patents,
trademarks, trade secrets, trade names, licenses and other approvals of
products and manufacturing processes, and other industrial property
rights; and
(g) the
borrowing of funds, the purchase and issuance of equity shares, and the
purchase of foreign exchange for imports.
3. (a)
Notwithstanding the preceding provisions of this Article, each Party
reserves the right to maintain limited exceptions to the standard of
treatment otherwise required if such exceptions fall within one of the
sectors or matters listed in the Annex to this Treaty. Each Party agrees
to notify the other Party of all such exceptions at the time this Treaty
enters into force. Moreover, each Party agrees to notify the other Party
of any future exceptions falling within the sectors or matters listed in
the Annex, and to maintain the number of such exceptions at a minimum.
Other than with respect to ownership of real property, the treatment
accorded pursuant to this subparagraph shall not be less favorable than
that accorded in like situations to investments and associated
activities of nationals or companies of any third country. However,
either Party may require that rights to engage in mining activities on
the public domain shall be dependent on reciprocity.
(b) No
exception introduced after the date of entry into force of this treaty
shall apply to investments of nationals or companies of the other Party
existing in that sector at the time the exception becomes effective.
4.
Investment of nationals and companies of either Party shall at all times
be accorded fair and equitable treatment and shall enjoy full protection
and security in the territory of the other Party. The treatment,
protection and security of investment shall be in accordance with
applicable national laws, and shall in no case be less than that
required by international law. Neither Party shall in any way impair by
arbitrary and discriminatory measures the management, operation,
maintenance, use, enjoyment, acquisition, expansion or disposal of
investment made by nationals or companies of the other Party. Each Party
shall observe any engagement it may have entered into with regard to
investment of nationals or companies of the other Party.
5. (a)
Nationals of either Party shall be permitted to enter and to remain in
the territory of the other Party for the purpose of establishing,
developing, directing, administering or advising on the operation of an
investment to which they, or a company of the first Party that employs
them, have committed or are in the process of committing a substantial
amount of capital or other resources.
(b) The
rights set forth in this paragraph shall be exercised in accordance with
the requirements of the laws and regulations of the parties relating to
the entry and sojourn of aliens. The provisions of this paragraph shall
be subject to the right of either Party to exclude or expel aliens on
grounds related to the maintenance of public order, the protection of
the public health, safety or morals, or national security.
6.
Nationals and companies of either Party shall be permitted to engage,
within the territory of the other Party, professional, technical and
managerial personnel of their choice, regardless of nationality, for the
particular purpose of rendering professional, technical and managerial
assistance necessary for the planning and operation of investments.
Companies which are incorporated, constituted. or otherwise organized
under the applicable laws or regulations of one Party, and which are
owned or controlled by nationals or companies of the other Party, shall
be permitted to engage, within the territory of the first Party, top
managerial personnel of their choice regardless of nationality:
7. The
Parties recognize that, consistent with paragraphs 1 and 2 of this
Article, conditions of competitive equality should be maintained where
investments owned or controlled by a Party or its agencies or
instrumentalities are in competition, within the territory of such
Party, with privately owned or controlled investments of nationals or
companies of the other Party.
8.
Neither Party shall impose performance requirements as a condition of
establishment, expansion or maintenance of investments owned by
nationals or companies of the other Party, which require or enforce
commitments to export goods produced, or which specify that goods or
services must be purchased locally, or which impose any other similar
requirements.
9. In
order to maintain a favorable environment for investments in its
territory by nationals or companies of the other Party, each Party shall
provide effective means of asserting claims and enforcing rights with
respect to investment agreements, investment authorizations and
properties. Each Party shall grant to nationals or companies of the
other Party, on terms and conditions no less favorable than those which
it grants in like situations to its own nationals or companies, and no
less favorable than those which it grants in like situations to
nationals or companies of any third country, the right of access to its
courts of justice, administrative tribunals and agencies, and all other
bodies exercising adjudicatory authority, and the right to employ
persons of their choice, who otherwise qualify under applicable laws and
regulations of the forum regardless of nationality, for the purpose of
asserting claims, and enforcing rights, with respect to their
investments.
10. Each
party shall make public by existing official means all laws,
regulations, administrative practices and procedures, and adjudicatory
decisions that pertain to or affect investments in its territory of
nationals or companies of the other Party. 11. The treatment accorded by
a Party to nationals or companies of the other Party under the
provisions of paragraphs 1 and 2 of this Article shall in any State,
Territory, possession, or political or administrative subdivision of the
Party be the treatment accorded therein to companies incorporated,
constituted or otherwise duly organized in other States, Territories,
possessions, or political or administrative subdivisions of the Party.
ARTICLE
III
COMPENSATION
FOR EXPROPRIATION
1. No
investment or any part of an investment of a national or a company of
either Party shall be expropriated or nationalized by the other Party or
subjected to any other measure or series of measures, direct or
indirect, tantamount to expropriation (including the levying of
taxation, the compulsory sale of all or part of an investment, or the
impairment or deprivation of its management, control or economic value),
all such measures hereinafter referred to as "expropriation,"
unless the expropriation;
(a) is
done for a public purpose;
(b) is
accomplished under due process of law;
(c) is
not discriminatory;
(d) does
not violate any specific provision on contractual stability or any
specific provision on expropriation contained in an investment agreement
between the national or company concerned and the Party making the
expropriations; and
(e) is
accompanied by prompt, adequate and effective compensation.
Compensation
shall be equivalent to the fair market value of the expropriated
investment. The calculation of such compensation shall not reflect any
reduction in such fair market value do to either prior public notice of
announcement of the expropriatory action, or the occurrence of the
events that constitute or resulted in the expropriatory action. Such
compensation shall be paid without delay, shall be effectively
realizable, shall bear current interest from the date of the
expropriation at a commercially reasonable rate, and shall be freely
transferable at the prevailing market rate of exchange on the date of
expropriation.
2. If
either Party expropriates the investment of any company duly
incorporated, constituted or otherwise duly organized in its territory,
and if nationals or companies of the other Party, directly or
indirectly, own, hold or have other rights with respect to the equity of
such company, the Party within whose territory the expropriation occurs
shall ensure that such nationals or companies of the other Party receive
compensation in accordance with the provisions of the preceding
paragraph.
3.
Subject to the dispute settlement provisions of any applicable
agreement, a national or company of either Party that asserts that all
or part of its investment in the territory of the other Party has been
expropriated shall have a right to prompt review by the appropriate
judicial or administrative authorities of such other Party to determine
whether any such expropriation has occurred and, if so, whether such
expropriation, and any compensation therefor, conforms to the provisions
of the present Treaty.
ARTICLE
IV
COMPENSATION
FOR DAMAGES DUE TO WAR AND SIMILAR EVENTS
1.
Nationals or companies of either Party whose investments in the
territory of the other Party suffer" (a) damages due to war or
other armed conflict between such other Party and a third country, or
(b) damages due to revolution, state of national emergency, revolt,
insurrection, riot or act of terrorism in the territory of such other
Party, shall accorded treatment no less favorable than that which such
other Party accords to its own nationals or companies and no less
favorable than that which it accords to nationals or companies of any
third country in matters concerning restitution, indemnification,
compensation or other appropriate settlement with respect to such
damages.
2. In the
event that such damages result from:
(a) a
requisitioning of property by the other Party's forces or authorities,
or
(b)
destruction of property by the other Party's forces or authorities which
was not caused in combat action or was not required by the necessity of
the situation,
the
national or company shall be accorded restitution or compensation
consistent with Article III.
3. The
payment of any indemnification, compensation or other settlement
pursuant to this Article shall be freely transferable.
ARTICLE
V
TRANSFERS
1. Each
Party shall permit all transfers related to an investment in its
territory of a national or company of the other Party to be made freely
and without delay into and out of its territory. Such transfers include
the following: returns; compensation; payments made arising out of a
dispute concerning an investment; payments made under a contract,
including amortization of principal and accrued interest payments made
pursuant to a loan agreement; amounts to cover expenses relating to the
management of the investment; royalties and other payments derived from
licenses, franchises or other grants of rights or from administrative or
technical assistance agreements, including management fees; proceeds
from the sale of all or any part of an investment and from the partial
or complete liquidation of the investment concerned, including any
incremental value; additional contributions to capital necessary or
appropriate for the maintenance or development of an investment.
2. To the
extent that a national or company of either Party has not made another
arrangement with the appropriate authorities of the other Party in whose
territory the investment of such national or company is situated,
currency transfers made pursuant to paragraph I of this Article shall be
permitted in a currency or currencies to be selected by such national or
company. However, transfer of the proceeds from a total or partial
liquidation of an investment shall be permitted in any freely usable
currency chosen by the Party receiving the investment. Except as
provided in Article III, transfers made pursuant to paragraph 1 of this
Article shall be made at the prevailing market rate of exchange on the
date of transfer with respect to spot transactions in the currency or
currencies to be transferred.
3.
Notwithstanding the preceding paragraphs, either Party may maintain laws
and regulations:
(a)
prescribing procedures to be followed concerning transfers permitted by
this Article, including verifications by the authorities responsible for
the control of foreign exchange provided that such procedures are
carried out without delay by the Party concerned and do not impair the
substance of the rights set forth in paragraphs 1 and 2 of this Article;
(b)
requiring reports of currency transfer; and
(c)
imposing income taxes by such means as a withholding tax applicable to
dividends or other transfers. Furthermore, either Party may protect the
rights of creditors, or ensure the satisfaction of judgments in
adjudicatory proceedings, through the equitable, nondiscriminatory and
good faith application of its law.
ARTICLE
VI
CONSULTATIONS
AND EXCHANGE OF INFORMATION
1. The
Parties agree to consult promptly, on the request of either, to resolve
any disputes in connection with the Treaty, or to discuss any matter
relating to the interpretation or application of tire Treaty, including
any matter or procedures, adjudicatory decisions, or policies of one
Party that pertain to or affect investments of nationals or companies of
the other Party.
2. If one
Party requests in writing that the other Party supply information in its
possession concerning investments in its territory by nationals or
companies of the Party making the request, then the other Party shall,
consistent with its applicable laws and regulations and with due regard
for business confidentiality, endeavor to establish appropriate
procedures and arrangements for the provision of any such information.
3. It is
the intention of the two Parties to consult periodically about the
status of this Treaty and its application. For this purpose, there will
be consultations, at a time and place to be determined by mutual accord,
between representatives of the two Parties every two years beginning
from the date this Treaty enters into force.
ARTICLE
VII
SETTLEMENT
OF INVESTMENT DISPUTES BETWEEN ONE PARTY AND A NATIONAL OR COMPANY OF
THE OTHER PARTY
1. For
purposes of this Article, an investment dispute is defined as a dispute
involving the interpretation or application of an investment agreement
between a Party and a national or company of the other party; the
interpretation or application of any investment authorization granted by
the competent authority of a Party to such a national or company; or an
alleged breach of any right conferred or created by this Treaty with
respect to an investment.
2. In the
event of an investment dispute between a Party and a national or company
of the other Party with respect to an investment of such national or
company in the territory of such Party, the parties to the dispute shall
initially seek to resolve the dispute by consultation and negotiation.
They may, upon the initiative of either of them and as a part of their
consultation and negotiation, agree to rely upon non-binding,
third-party procedures, such as the fact-finding facility available
under the Rules of the Additional Facility ("Additional Facility")
of the International Centre for the Disputes ("Centre"). If
the dispute cannot be resolved through consultation and negotiation,
then it shall be submitted for settlement in accordance with the
applicable dispute-settlement procedures upon which the parties have
previously agreed. In the case of expropriation by either Party, any
dispute-settlement procedures specified in an investment agreement
between such Party and Such national or company shall remain binding and
shall be enforceable in accordance with the terms of the investment
agreement and relevant provisions of domestic laws of such Party and
treaties and other international agreements regarding enforcement of
arbitral awards to which such Party has subscribed.
3. (a)
Each Party hereby consents to the submission of any dispute between such
Party and a national or company of the other Party to the Centre for
settlement by conciliation or binding arbitration if, at any time after
six months from the date upon which the dispute arose:
(i) the
dispute has not, for any reason, been submitted for settlement in
accordance with any applicable dispute settlement procedures previously
agreed to by the parties to the dispute; and
(ii) the
national or company concerned has not brought the dispute before the
courts of justice or other competent tribunals of the Party that is a
party to the dispute.
If the
national or company concerned consents in writing to the submission of
the dispute to the Centre in the circumstances set forth above, either
party to the dispute may institute proceedings before the Centre by
addressing a request to this effect to the Secretariat of the Centre
following the required procedures of Articles 28 and 36 of the
Convention on the Settlement of Investment Disputes between States and
Nationals of Other States done at Washington March 18, 1965 ("the
Convention"). If the parties disagree over whether conciliation or
binding arbitration is the more appropriate procedure to be employed,
the opinion of the national or company concerned shall prevail.
(b)
Conciliation or binding arbitration of such disputes shall be done in
accordance with the provisions of the Convention and the Regulations and
Rules of the Centre.
4. A
Party that is party to an investment dispute may not, at any stage of an
arbitration or other dispute settlement procedure, raise as a defense
the fact that the national or company that is the other party to the
dispute has received or will receive, pursuant to an insurance contract,
indemnification for all or part of its damages.
5. For
the purposes of this Article, a company that is constituted or created
by virtue of the law in force in the jurisdiction of one of the Parties
but that, before the dispute arose, was owned or controlled by nationals
or companies of the other Party, shall be treated as a national or
company of such other Party.
6. The
provisions of this Article shall not apply to a dispute arising:
(a) under
the export credit, guarantee or insurance programs of the Export-Import
Bank of the United States, or
(b) under
other official credit, guarantee or insurance arrangements pursuant to
which the Parties have agreed to other-means of settling disputes.
ARTICLE
VIII
SETTLEMENT
OF DISPUTES BETWEEN THE PARTIES CONCERNING INTERPRETATION OR APPLICATION
OF THIS TREATY
1. Any
dispute between the Parties concerning the interpretation or application
of this Treaty should, if possible, be resolved through diplomatic
channels.
2. If the
dispute between the Parties cannot be resolved through the aforesaid
means, it shall be submitted at the request of either Party to an
arbitral tribunal for binding decision.
3. The
tribunal shall be established for each case as follows: Within two
months of receipt of a request for arbitration, each Party shall
designate a member of the tribunal. These two members shall then choose
a national of a third state who, with the agreement of the two Parties,
shall be appointed president of the tribunal. The president shall be
appointed within two months of the date of the designation of the other
two members.
4. If the
appointments required by the paragraphs of this Article have not been
made within the time specified, either of the Parties may, in the
absence of any other agreement, request that the President of the,
International Court of Justice make the required appointments. If the
President is a national of one of the Parties or if he is prevented for
whatever reason from carrying out the aforesaid functions, the Vice
President shall be asked to make the required appointments. If the Vice
President is in the same situation, the next ranking member of the Court
who is not a national of one of the Parties shall be asked to make the
required appointments. In the event that an arbitrator resigns or is for
any reason unable to perform his duties, a replacement shall be
appointed within thirty days, utilizing the same method by which the
arbitrator being replaced was appointed.
5. The
Parties may agree to specific arbitral procedures. In the absence of
such agreement, the Model Rules on Arbitral Procedure adopted by the
United Nations International Law Commission in 1958 ("Model Rules")
and commended to Member States by the United Nations General Assembly in
Resolution 1262 (XIII) shall govern. To the extent that procedural
questions are not resolved by this Article or the Model Rules, they
shall be resolved by the tribunal.
6. The
tribunal shall take its decisions according to the provisions of this
Treaty and of any other agreements between the Parties that are relevant
and applicable, as well as according to the rules and principles of
international law. It shall decide in all matters by majority vote. Any
such decision shall be binding on both Parties. Each Party shall bear
the expenses of its own representation in the course of the arbitration
proceedings and of the arbitrator that it has selected. Expenses
incurred by the president, and other costs of the proceeding, shall be
paid for equally by the Parties. The tribunal may, however, at its
discretion, direct that a higher proportion of the costs be paid by one
of the Parties, and such a decision shall be binding on both Parties.
7. This
Article shall not be applicable to a dispute that has been submitted to
the Centre pursuant to Article VII(3). Recourse to the procedures set
forth in this Article is not precluded, however, in the event that an
award rendered in such a dispute is not honored by a Party, or an issue
exists related to a dispute submitted to the Centre but not argued or
decided in that proceedings
8. The
provisions of this Article shall not apply to a dispute arising:
(a) under
the export credit, guarantee or insurance programs of the Export-Import
Bank of the United States, or
(b) under
other official credit, guarantee or insurance arrangements pursuant to
which the Parties have agreed to other means of settling disputes.
ARTICLE
IX
PRESERVATION
OF RIGHTS
This
Treaty shall not supersede, prejudice, or otherwise derogate from:
(a) laws
and regulations, administrative practices or procedures, or
administrative or adjudicatory decisions of either Party;
(b)
international legal obligations; or
(c)
obligations assumed by either Party, including those contained in an
investment agreement or an investment authorization, whether extant at
the time of entry into force of this Treaty or thereafter, that entitle
investments, or associated activities, of nationals or companies of the
other Party to treatment more favorable than that accorded by this
Treaty in like situations.
ARTICLE
X
MEASURES
NOT PRECLUDED BY THIS TREATY
1. Treaty
shall not preclude the application by either Party of any and all
measures necessary for the maintenance of public order and morals, the
fulfillment of its obligations with respect to the maintenance or
restoration of international peace or security, or the protection of its
own essential security interests.
2. This
Treaty shall not preclude either Party from prescribing special
formalities in connection with the establishment of investments in its
territory of nationals and companies of the other Party, but such
formalities shall not impair the substance of any of the rights set
forth in this Treaty.
ARTICLE
XI
TAXATION
1. With
respect to its tax policies, each Party should strive to accord fairness
and equity in the treatment of investment of nationals and companies of
the other Party.
2.
Nevertheless, the provisions of this Treaty, and in particular Articles
VII and VIII, shall apply to matters of taxation only with respect to
the following: (a) expropriation, pursuant to Article III; (b)
transfers, pursuant to Article V; or (c) the observance and enforcement
of terms of an investment agreement or authorization as referred to in
Article VII (1)(a) or (b).
Matters
covered by item 2(c) shall not be covered to the extent they are subject
to the dispute settlement provisions of a convention for the avoidance
of double taxation between the two Parties, unless such matters are
raised under such settlement provisions and are not resolved within a
reasonable period of time.
ARTICLE
XII
APPLICATION
OF THIS TREATY TO POLITICAL SUBDIVISIONS OF THE PARTIES
This
Treaty shall apply to political subdivisions of the Parties.
ARTICLE
XIII
ENTRY INTO FORCE AND DURATION, AMENDMENT AND TERMINATION
1. This
Treaty shall be ratified according to the appropriate constitutional
procedures of each Party by each of the Parties, and the instruments of
ratification thereof shall be exchanged as soon as possible.
2. This
Treaty shall enter into force thirty days after the date of exchange of
instruments of ratification. It shall remain in force for a period of
ten years and shall continue in force unless terminated in accordance
with Paragraph 4 of this Article. It shall apply to investments existing
at the time of entry into force as well as to investments made or
acquired thereafter.
3. Each
Party may submit to the other in writing by diplomatic channels
proposals for amendment. Any amendment will enter into force as own as
it has been agreed to by the two Parties.
4. Either
Party may, by giving one year's written notice to the other Party,
terminate this Treaty at the end of the initial ten-year period or at
any time thereafter.
With
respect to investments made or acquired prior to the date of termination
of this Treaty and to which this Treaty otherwise applies, the
provisions of all of the other Articles of this Treaty shall thereafter
continue to be effective for a further period of ten years from such
date of termination.
IN
WITNESS WHEREOF, the respective Plenipotentiaries have signed this
Treaty.
DONE in
duplicate at Washington, on the sixth day of December, 1983 in the
English and French languages, both texts being equally authentic.
FOR THE
GOVERNMENT OF THE UNITED STATES OF AMERICA
FOR THE
GOVERNMENT OF THE UNITED STATES OF REPUBLIC OF SENEGAL
Robert E.
Lighthizer Deputy United States Trade Representative
Moustapha Niasse Minister
of State for Foreign Affairs
ANNEX
In
accordance with Article II., paragraph 3, each Party reserves the right
to maintain limited exceptions in the sectors it has indicated below:
For the
United States of America
Air
transportation; ocean and coastal shipping; banking; insurance;
government grants; government insurance and loan programs; energy and
power production; custom house brokers; ownership of real estate;
ownership and operation of broadcast or common carrier radio and
television stations; ownership of shares in the Communications Satellite
Corporation; the provision of common carrier telephone and telegraph
services; the provision of submarine cable services; use of land and
natural resources.
For
Senegal
Small and
medium-sized enterprises specified in Law 81-51 of July 26, 1981.
PROTOCOL
The duly
authorized Plenipotentiaries of the Parties have further agreed upon the
following provisions, which shall form an integral part of the Treaty on
the reciprocal encouragement and protection of investment, signed on
this date.
1. The
provisions of Article II (6) shall not be construed to confer any rights
with respect to the entry and sojourn of persons in the territory of
either Party, except as provided by the national law.
2.
Without prejudice to the rights set forth in article II, paragraph 6,
the Parties recognize that the employment of Senegalese nationals by
nationals and companies of the United States maintaining investments
within the territory of the Republic of Senegal, where the
qualifications of such Senegalese nationals are equal or superior to
those of other applicants for employment, would contribute to the
economic and social development objectives of the Republic of Senegal.
3.
Without prejudice to the obligations set forth in Article II, paragraph
8, the Parties recognize that the purchase of goods and services within
the territory of the Party receiving the investment, where such goods
and services are available in conditions of price, quality and delivery
time equal or superior to those of competitive goods and services and
where such purchase is otherwise consistent with the requirements of
economic efficiency, can contribute to the economic objectives of the
Parties.
4.
Payment of compensation shall be considered to be made "without
delay" in conformity with Article III(l) if adequate provision has
been made prior to the date of the expropriation for the determination
and payment of such compensation and the compensation is paid within a
period of time no longer than is necessary for the prompt completion of
all necessary formalities. In the event of an expropriation by the
Republic of Senegal, the discount rate established by the Central Bank
of West African States during the period between the expropriation and
the payment of compensation shall be considered to be a "commercially
reasonable rate" of interest in conformity with Article III(l).
5. In the
event that either Party is no longer a Party to the Convention on the
Settlement of Investment Disputes between States and Nationals of Other
States or the facilities of the International Centre for the Settlement
of Investment Disputes are for any other reason not available for the
purpose set forth in Article VII(3), the Additional Facility shall be
employed for such purposes.
IN
WITNESS WHEREOF, the respective Plenipotentiaries have signed this
Protocol.
DONE in
duplicate at Washington, on the sixth day of December 1983, in the
English and French languages, both texts being equally authentic.
Robert E.
Lighthizer
Deputy United States Trade Representative
Moustapha Niasse
Minister of State for Foreign Affairs
The TCC
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