Similar to Agreement between the government of australia and the government of the republic of india on the promotion and protection of investments (20)
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Agreement between the government of australia and the government of the republic of india on the promotion and protection of investments
1. AGREEMENT BETWEEN THE GOVERNMENT OF AUSTRALIA AND THE GOVERNMENT OF THE REPUBLIC OF INDIA ON THE PROMOTION AND PROTECTION OF INVESTMENTS Presented By: Rohan Mehta Saunil Arora Parth Purohit Mochal Bhola
2. Introduction The Government Of AUSTRALIA and the Government of the REPUBLIC OF INDIA after 26 February 1999 became the contracting parties. Australia has a focused sector-specific strategy that delivers introduction and solutions for Indian businesses in many areas.
3. A comment on Bilateral Investments between Australia & India Indian investments have been predominantly in the resources, IT and hospitality sectors. Tata's investment in Geodynamics is developing one of three Australian projects to create the first commercial-scale hot rock geothermal energy projects in the world. There has been growing interest in areas like services and aviation. Contd…
4. Employment more than 5,000 people across Australia and experiencing string business growth. Now medium-size Indian enterprises are also having great success in Australia, with companies including Mphasis and Micro Technologies recently announcing new investments to tap the Australian market. Australian companies involved in the infrastructure and construction sectors have significant interests and investments in India. Contd…
5. Different Australian Financial Institution have established their presence in India & vice versa to cater the growing bilateral trade & investment. Australian institutions like: ANZ Bank, National Australia Bank, Commonwealth Bank of Australia, Westpac Bank, and the Australia Insurance Group. Indian institution like: Bank of Baroda, Union Bank, and State Bank of India. Australian companies involved in the infrastructure and construction sectors have significant interests and investments in India.
6. The contracting parties recognize The importance of promoting the flow of capital for economic activity and development and aware of its role in expanding economic relations between them, particularly with respect to investment by investors of one contracting Party in the territory of the other Contracting Party. The pursuit of objectives would be facilitated by a clear statement of principles relating to the protection of investments, combined with rules designed to render more effective the application of these principles within the territories of the Contracting Parties.
7. The contracting partiesconsider Investment relations should be promoted and economic cooperation strengthened in accordance with the internationally accepted principles of mutual respect for sovereignty, equality, mutual benefit, non-discrimination and mutual confidence.
8. The contracting partiesacknowledge Investments of investors of one contracting Party in the territory of the other Contracting Party would be made within the framework of laws of that other Contracting Party.
11. Company: It should be owned or controlled by an entity or a natural person who is a citizen or PR of the contracting parties or a third country. Freely Convertible Currency: A convertible currency as classified by the IMF or any currency that is widely traded in international ForEx markets. Investment: By an investor of one Contracting Party in the territory of the other Contracting Party in accordance with the laws and investment policies of that Contracting Party. Contd…
12. Investor: Should be under the law of any of the contracting parties. Returns: The monetary returns. Territory: Territorial waters and the airspace above it and other maritime zones including Exclusive Economic Zone and continental shelf.
14. All investments made by investors of either Contracting Party in the territory of the other Contracting Party, whether made before or after the coming into force of this Agreement. Any investments in that company by investors of the other Contracting Party shall be protected by this Agreement. The agreement shall not apply to a company organized under the law of a third country. This Agreement shall not apply to a natural person who is a permanent resident but not a citizen of a Contracting Party.
16. Encourage and promote favorable conditions for investors of the other Contracting Party to make investments in its territory. Each Contracting Party shall admit such investments in accordance with its laws and investment policies applicable from time to time. Investments or investors of each Contracting Party shall at all times be accorded fair and equitable treatment. A Contracting Party shall, subject to its laws, accord within its territory protection and security to investments and shall not impair the management, maintenance, use, enjoyment or disposal of investments.
18. Grant of investments made by one contracting party should not be biased. Treatment of investments in its own territory on a basis no less favorable than that accorded to investments of investors of any third country. The facilities available to the investors of a contracting party should not be less than those given to investors of a 3rd country. No extension to investments on any treatment, preference or privilege.
20. A Contracting Party shall, subject to its laws applicable from time to time relating to: The entry and sojourn of non-citizens, permit natural persons who are investors of the other Contracting Party and personnel employed by companies of that other Contracting Party to enter and remain in its territory for the purpose of engaging in activities connected with investments. Permit investors of the other Contracting Party who have made investments in the territory of the first Contracting Party to employ within its territory key technical and managerial personnel of their choice regardless of citizenship.
22. Each Contracting Party shall, with a view to promoting the understanding of its laws that pertain to or affect investments in its territory by investors of the other Contracting Party make such laws public and readily accessible.
24. Neither Contracting Party shall nationalize, expropriate or subject to measures having effect equivalent to nationalization or expropriation except for a public purpose, on a non-discriminatory basis, in accordance with its laws and against fair and equitable compensation. The compensation shall be computed on the basis of the market value of the investment immediately before the expropriation or impending expropriation became public knowledge. Where that value cannot be readily ascertained, the compensation shall be determined in accordance with generally recognized principles of valuation and equitable principles.
25. The compensation shall be paid without undue delay, shall include interest at a normal market rate. The compensation shall be payable either in the currency in which the investment was originally made or, if requested by the investor, in any other freely convertible currency. An investor whose investment is expropriated may, under the law of the Contracting Party making the expropriation, seek review of the expropriation measures by a judicial or other independent authority of that Party, as appropriate.
26. Where a Contracting Party expropriates a company, the provisions of this Article are applied to the extent necessary to ensure compensation in respect of their investments to such investors of the other Contracting Party who are owners of those shares.
28. Compensation for losses sufffered owing to war or other armed conflict, a state of national emergency or civil disturbances shall be accorded by the latter Contracting Party treatment. It should be no less favorable than that which the latter Contracting Party accords to its own investors or investors of any third State
29. Article 9 Repatriation of investment and returns
30. Each Contracting Party shall permit all funds of an investor of the other Contracting Party related to an investment in its territory to be freely transferred, without unreasonable delay and on a non-discriminatory basis. Unless otherwise agreed to between the Parties, currency transfer shall be permitted in the currency of the original investment or any other convertible currency. Such transfer shall be made at the prevailing market rate of exchange on the date of transfer.
32. The subrogated right or claim shall not be greater than the original right or claim of the invest. After payment to its investor and has taken over rights and claims of the investor, that investor shall not pursue those rights and claims against the other Contracting Party. In a dispute relating to an investment, a Contracting Party shall not assert, as a defense, counter claim, that the investor concerned has received or will receive, pursuant to an insurance or guarantee contract, indemnification or other compensation for all or part of any alleged loss.
33. Article 11 Consultation between Contracting Parties The Contracting Parties shall consult at the request of either of them on matters concerning this Agreement.
34. Article 12 Settlement of disputes between an investor and a Contracting Party
35. Any dispute between an investor of one Contracting Party and the other Contracting Party shall, as far as possible, be settled amicably through negotiations between the Parties to the dispute. Any such dispute which has not been amicably settled may, if both Parties agree, be submitted for resolution or to the International Conciliation. Should the Parties fail to agree on a dispute settlement procedure or the failure of conciliation than the dispute may be referred to Arbitration.
36. Article 13 Disputes between the Contracting Parties
37. Disputes concerning the interpretation or application of the Agreement should be settled through friendly consultations and negotiations. If a dispute is settled within six months of one Contracting Party receiving a request in writing for such negotiations ,it shall upon the request be submitted to an arbitral tribunal. Arbitration proceedings shall be instituted upon notice being given through the diplomatic channel by the Contracting Party instituting such proceedings to the other Contracting Party.
38. Appointment of the Arbitral Tribunal: Within two months each Contracting Party shall appoint one member of the tribunal. Those two members shall then select a national of a third State who on approval by the two Contracting Parties shall be appointed Chairperson of the tribunal within a month. If the appointment is not made within due time: Either Contracting Party may, in the absence of any other agreement, invite the President of the International Court of Justice to make any necessary appointments. If the President is prevented from doing so than the Vice-President shall be invited. If the VP is also prevented than the next seniority member acceptable will be appointed.
39. If the arbitrator appointed resigns or becomes unable to act, a successor arbitrator shall be appointed in the same manner as prescribed for the appointment of the original arbitrator. The arbitral tribunal shall reach its decision by a majority of votes. The award shall be rendered in writing and shall state its legal basis. Such award shall be binding on both Contracting Parties. The Arbitral Tribunal shall in accordance with this Agreement decide all questions relating to its competence and shall subject to any agreement between the Contracting Parties, determine its own procedure.
40. Article 14 Applicable laws All investments shall be consistent with this Agreement and be in accordance with the laws in force in the territory of the Contracting Party in which such investments are made.
41. Article 15 Prohibitions and restrictions Nothing in this Agreement precludes the host Contracting Party from taking, in accordance with its laws applied reasonably and on a non-discriminatory basis, measures necessary for the protection of its own essential security interests or for the prevention of diseases or pests.
42. Article 16 Application of other rules If the provisions of the law of either Contracting Party or provisions of an international agreement between the Contracting Parties in addition to the present Agreement contain rules, entitling investments by investors of the other Contracting Party to treatment more favorable than is provided for by the present agreement, such rules shall to the extent that they are more favorable prevail over the present Agreement.
43. Article 17 Entry into force, duration and termination
44. The agreement will remain in force for a duration of 10 years. Either Contracting Party may terminate this Agreement at any time after it has been in force for ten years by giving one year's written notice to the other Contracting Party. Not withstanding termination of this Agreement, the Agreement shall continue to be effective for a further period of fifteen years from the date of its termination in respect of investments made or acquired before the date of termination of this Agreement.
45. S.W.O.T Analysis Strengths Reduction or elimination of tariff barriers between India and Australia is important under the proposed FTA in order to step up bilateral trade flow. full tariff liberalization on manufactured products along with import-augmenting technical change denoting trade facilitation effect Weakness: Cross cultural differences.
46. Opportunities: A potential bilateral FTA could include a chapter on consultations and dispute settlement which would establish fair, transparent, timely, and effective procedures to settle disputes arising under the Agreement. Threats: Political instability and domestic riots. `
47. Conclusion Due to this well formed treaty there is a strong and productive Bilateral Relationship between Australia and India. Analysis of the bilateral trade in goods suggests substantial increases are possible through a comprehensive FTA. The services sector is an important part of both Australian and Indian global exports. It contributes to about 37 per cent of India’s exports and about 21 per cent of Australia’s exports
48. Australia-India investment flows are modest relative to bilateral trade and there is considerable scope for enhanced investment links between Australia and India.
two-way investments across sectors including the mining industry. Driving commercial relationships to higher levels. resources, mining and energy; infrastructure; building and construction; food and beverage; agri-business; ICT; film, media and entertainment; consumer, fashion and lifestyle; financial services; clean energy and environment.11 offices across India to facilitate trade between Australia and India
Indian companies have invested in copper and coal mines, new and renewable energy as well as in downstream gas processing.There has been growing interest in areas like services and aviation, demonstrated through Mahindra & Mahindra's recent investment in the aviation sector through the acquisition of Gippsland Aeronautics and Aerostaff Australia.
companies including Infosys, TCS, Wipro, Mahindra Satyam, and HCL growing strongly across Australia.Australian companies involved in the infrastructure and construction sectors have significant interests and investments in India; these include Leighton, SMEC, Worley Parsons SKM, GHD, Meinhardt, Norfolk etc., to name a few.
Once an action referred to in paragraphs 2 and 3 of this Article has been taken, neither Contracting Party shall pursue the dispute through diplomatic channels unless: (a) the relevant judicial or administrative body, the Secretary General of the Centre, the arbitral authority or tribunal or the conciliation commission, as the case may be, has decided that it has no jurisdiction in relation to the dispute in question; or (b) the other Contracting Party has failed to abide by or comply with any judgement, award, order or other determination made by the body in question.
