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13050 Zambia - Investment Incentive Agreement


   
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TREATIES AND OTHER INTERNATIONAL ACTS SERIES 13050

 

 

INVESTMENT GUARANTIES

 

 

 

 

Agreement Between the
UNITED STATES OF AMERICA
and ZAMBIA

 


Signed at Lusaka June 23, 1999

 

 

 

 

 

NOTE BY THE DEPARTMENT OF STATE

Pursuant to Public Law 89—497, approved July 8, 1966
(80 Stat. 271; 1 U.S.C. 113)—

“. . .the Treaties and Other International Acts Series issued
under the authority of the Secretary of State shall be competent
evidence . . . of the treaties, international agreements other than
treaties, and proclamations by the President of such treaties and
international agreements other than treaties, as the case may be,
therein contained, in all the courts of law and equity and of maritime
jurisdiction, and in all the tribunals and public offices of the
United States, and of the several States, without any further proof
or authentication thereof.”

 

ZAMBIA

Investment Guaranties

Agreement signed at Lusaka June 23, 1999;
Entered into force July 2, 1999.

INVESTMENT INCENTIVE AGREEMENT
BETWEEN
THE GOVERNMENT OF THE UNITED STATES OF AMERICA
AND
THE GOVERNMENT OF THE REPUBLIC OF ZAMBIA
THE GOVERNMENT OF THE UNITED STATES OF AMERICA and THE
GOVERNMENT OF THE REPUBLIC OF ZAMBIA;
AFFIRMING their common desire to encourage economic activities in the
Republic of Zambia that promote the development of the economic resources and
productive capacities of the Republic of Zambia; and
RECOGNIZING that this objective can be promoted through investment
support provided by the Overseas Private Investment Corporation ("OPIC"), a
development institution and an agency of the United States of America, in the form
of investment insurance and reinsurance, debt and equity investments and
investment guaranties;
HAVE AGREED as follows:
ARTICLE 1
As used in this Agreement, the following terms have the meanings herein
provided. The term "Investment Support" refers to any debt or equity investment,
any investment guaranty and any investment insurance or reinsurance which is
provided by the Issuer in connection with a project in the territory of the Republic
of Zambia. The term "Issuer" refers to OPIC and any successor agency of the
United States of America, and any agent of either. The term "Taxes" means all
present and future taxes, levies, imposts, stamps, duties and charges imposed in the
Republic of Zambia and all liabilities with respect thereto.
ARTICLE 2
(a) The Issuer shall not be subject to regulation under the laws of the
Republic of Zambia applicable to insurance or financial organizations.
(b) All operations and activities undertaken by the Issuer in connection
with any Investment Support, and all payments, whether of interest, principal, fees,
dividends, premiums or the proceeds from the liquidation of assets or of any other
nature, that are made, received or guaranteed by the Issuer in connection with any
Investment Support shall be exempt from Taxes. The Issuer shall not be subject to
any Taxes in connection with any transfer, succession or other acquisition which
occurs pursuant to paragraph (c) of this Article or Article 3(a) hereof. Any project
in connection with which Investment Support has been provided shall be accorded
tax treatment no less favorable than that accorded to projects benefiting from the
investment support programs of any other national or multilateral development
institution which operates in the Republic of Zambia.
(c) If the Issuer makes a payment to any person or entity, or exercises
its rights as a creditor or subrogee, in connection with any Investment Support, the
Government of the Republic of Zambia shall recognize the transfer to, or
acquisition by, the Issuer of any cash, accounts, credits, instruments or other assets
in connection with such payment or the exercise of such rights, as well as the
succession of the Issuer to any right, title, claim, privilege or cause of action
existing, or which may arise, in connection therewith.
(d) With respect to any interests transferred to the Issuer or any interests
to which the Issuer succeeds under this Article, the Issuer shall assert no greater
rights than those of the person or entity from whom such interests were received,
provided that nothing in this Agreement shall limit the right of the Government of
the United States of America to assert a claim under international law in its
sovereign capacity, as distinct from any rights it may have as the Issuer pursuant to
paragraph (c) of this Article.
ARTICLE 3
(a) Amounts in the currency of the Republic of Zambia, including cash,
accounts, credits, instruments or otherwise, acquired by the Issuer upon making a
payment, or upon the exercise of its rights as a creditor, in connection with any
Investment Support provided by the Issuer for a project in the Republic of Zambia,
shall be accorded treatment in the territory of the Republic of Zambia no less
favorable as to use and conversion than the treatment to which such funds would
have been entitled in the hands of the person or entity from which the Issuer
acquired such amounts.
(b) Such currency and credits may be transferred by the Issuer to any
person or entity and upon such transfer shall be freely available for use by such
person or entity in the territory of the Republic of Zambia in accordance with its
laws.
ARTICLE 4
(a) Any dispute between the Government of the United States of
America and the Government of the Republic of Zambia regarding the
interpretation of this Agreement or which, in the opinion of either party hereto,
presents a question of international law arising out of any project or activity for
which Investment Support has been provided shall be resolved, insofar as possible,
through negotiations between the two Governments. If, six months following a
request for negotiations hereunder, the two Governments have not resolved the
dispute, the dispute, including the question of whether such dispute presents a
2
question of international law, shall be submitted, at the initiative of either
Government, to an arbitral tribunal for resolution in accordance with paragraph (b)
of this Article.
(b) The arbitral tribunal referred to in paragraph (a) of this Article shall
be established and shall function as follows:
(i) Each Government shall appoint one arbitrator. These two
arbitrators shall by agreement designate a president of the tribunal who shall
be a citizen of a third state and whose appointment shall be subject to
acceptance by the two Governments. The arbitrators shall be appointed
within three months, and the president within six months, of the date of
receipt of either Government's request for arbitration. If the appointments
are not made within the foregoing time limits, either Government may, in
the absence of any other agreement, request the Secretary-General of the
International Centre for the Settlement of Investment Disputes to make the
necessary appointment or appointments, provided, however, that if, at the
time of such request the Secretary-General is a national of either the United
States of America or the Republic of Zambia or is otherwise prevented from
making such appointment or appointments, then his or her most senior
deputy who is neither a national of either the Republic of Zambia or the
United States of America and who is not otherwise prevented from making
such appointment or appointments, shall be requested to make the necessary
appointment or appointments. Both Governments hereby agree to accept
such appointment or appointments.
(ii) Decisions of the arbitral tribunal shall be made by majority
vote, and shall be based on the applicable principles and rules of
international law. Its decision shall be final and binding.
(iii) During the proceedings, each Government shall bear the
expense of its arbitrator and of its representation in the proceedings before
the tribunal, whereas the expenses of the president and other costs of the
arbitration shall be paid in equal parts by the two Governments. In its
award, the arbitral tribunal may reallocate expenses and costs between the
two Governments.
(iv) In all other matters, the arbitral tribunal shall regulate its own
procedures.
ARTICLE 5
(a) This Agreement shall enter into force on the date on which the
Government of the Republic of Zambia notifies the Government of the United
States of America that all legal requirements (including a determination that the
Issuer, as an agency of the United States of America, shall not be subject to tax or
regulation as provided in Article 2, hereof) for entry into force of this Agreement
have been fulfilled.
3
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(b) This Agreement shall continue in force until six months from the
date of a receipt of a note by which one Government informs the other of an intent
to terminate this Agreement. In such event, the provisions of this Agreement shall,
with respect to Investment Support provided while this Agreement was in force,
remain in force so long as such Investment Support remains outstanding, but in no
case longer than twenty years after the termination of this Agreement.
(c) Upon entry into force, this Agreement shall supersede the agreement
on investment guaranties between the Government of the United States of America
and the Government of the Republic of Zambia effected by exchange of notes
signed at Lusaka on August 11, 1966. Any matter concerning the Republic of
Zambia relating to support by OPIC of investments in the territory of the Republic
of Zambia prior to the entry into force of this Agreement shall be resolved under
the terms of this Agreement.
IN WITNESS WHEREOF, the undersigned, duly authorized by their respective
Governments, have signed this Agreement.
DONE at Lusaka, Republic of Zambia, on the 23rd day of June, 1999, in
duplicate, both texts being equally authentic.
FOR THE GOVERNMENT FOR THE GOVERNMENT
OF OF
THE UNITED STATES OF AMERICA THE REPUBLIC OF ZAMBIA
Arlene Render
Ambassador
Boniface Nonde
Permanent Secretary
Ministry of Finance and
Economic Development



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