On the ratification of the Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on the Promotion and Mutual Protection of Investments

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Law of the Republic of Kazakhstan dated December 5, 1997 No. 199

To ratify the Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on the Promotion and Mutual Protection of Investments, signed on September 17, 1996 in Tbilisi.

President of the Republic of Kazakhstan

 AGREEMENT between the Government of the Republic of Kazakhstan and The Government of Georgia on the Promotion and Mutual Protection of Investments

(Official website of the Ministry of Foreign Affairs of the Republic of Kazakhstan - Entered into force on April 24, 1998)

The Government of the Republic of Kazakhstan and the Government of Georgia (hereinafter referred to as the "Contracting Parties"), desiring to strengthen economic cooperation on a long-term basis for the mutual benefit of both Contracting Parties, intending to create and maintain favorable conditions for investors of one Contracting Party in the territory of the other Contracting Party, recognizing that the promotion and mutual protection of investments, in accordance with this Agreement, will stimulate business initiative in this area, agreed on the following:

 Article 1 Definitions For the purposes of this Agreement: 1. The term "investment" will cover any type of assets invested in connection with the economic activities of investors of one Contracting Party in the territory of the other Contracting Party in accordance with the applicable legislation of the latter and will include, in particular but not exclusively: a) movable and immovable property, as well as any other rights such as mortgages, rights maintenance, loan collateral, and similArticle 1 Definitions For the purposes of this Agreement: 1. The term "investment" will cover any type of assets invested in connection with the economic activities of investors of one Contracting Party in the territory of the other Contracting Party in accordance with the applicable legislation of the la and will include, in particular but not exclusively: a) movable and immovable property, as well as any other rights such as mortgages, rights maintenance, loan collateral, and similar rights; b) shares, securities and debt obligations of legal entities or the property part of these legal entities; c) loans, credits, targeted bank and financial deposits and other monetary claims related to investments; d) intellectual property rights, including copyrights, trademarks, patents, industrial designs, technological processes, know-how, trade secrets, brand names, and goodwill related to the investment; e) licenses and permits in accordance with the legislation; Any change in the form permitted by the legislation and other regulations of the Contracting Parties in which the assets are invested will not affect their nature as investments. 2. The term "investor" means any natural or legal person who invests in the territory of another Contracting Party: a) the term "natural person" means any natural person who has citizenship or permanent residence in any of the Contracting Parties in accordance with its laws; b) the term "legal entity" means, in relation to he term "legal entity" means, in relation to any Contracting Party, any institution, enterprise or organization established in accordance with the applicable legislation of each of the Contracting Parties and which has the right to make investments in the territory of the other Contracting Party; c) a legal entity not established in accordance with the legislation of one of the Contracting Parties, but expressly or indirectly controlled by individuals or legal entities of the same Contracting Party. 3. The term "income" means the monetary amounts received as a result of investments and includes, in parity, but not exclusively, income, interest, capital gains, shares, dividends, royalties, and fees for services. 4. The term "territory" means, with respect to each Contracting Party, the territory under its sovereignty, as well as the marine and underwater areas over which that Contracting Party exercises sovereignty, rights and jurisdiction in accordance with international law.  

Article 2 Application of this Agreement 1. The terms of this Agreement will apply to all investments made by investors of one Contracting Party in the territory of the other Contracting Party both before and after the entry into force of this Agreement. 2. The provisions of this Agreement do not apply to investments made before December 16, 1991.  

Article Z Promotion and protection of investments 1. Each Contracting Party will encourage and create favorable conditions for investors of the other Contracting Party to make investments in its territory and allow such investments in accordance with its laws and regulations. 2. Each of the Contracting Parties will ensure fair and equitable treatment for investments of the other Contracting Party and will not infringe through arbitrary or discriminatory measures on the management, operation, use or disposal of these investments.  

 Article 4 National and most-favored-nation treatment 1. Each Contracti  Article 4 National and most-favored-nation treatment 1. Each Contracting Party in its territory will provide investments of investors of the other Contracting Party with a regime that is fair and equal and no less favorable than that which it provides to investments of its own investors or investments of investors of any third State. 2. Each Contracting Party in its territory will provide investors of the other Contracting Party with a regime that is fair and equal and no less favorable than that which it provides to its own investors or investors of any third State in relation to the management, operation, use or disposal of these investments. 3. The provisions of paragraphs 1 and 2 of this Article do not apply to: a) advantages that one of the Contracting Parties provides to investors of individual countries The provisions of paragraphs 1 and 2 of this Article do not apply to: a) advantages that one of the Contracting Parties provides to investors of individual countries in connection with their joint participation in a Customs or Economic Free Trade Union; b) advantages that one of the Contracting Parties provides to investors of individual countries on the basis of an Agreement on the Avoidance of Double Taxation or other agreements on tax issues. Article

5 Compensation for losses 1. When investments of investors of either Contracting Party suffer losses due to war, armed conflict, national emergency, coup, uprising, conspiracy, natural disaster, accident or other similar circumstances in the territory of the Contracting Party, they will be provided by the other Contracting Party with a regime in relation to restitution, compensation, compensation or other solution, no less favorable than the one that the latter Contracting When investments of investors of either Contracting Party suffer losses due to war, armed conflict, national emergency, coup, uprising, conspiracy, natural disaster, accident or other similar circumstances in the territory of the Contracting Party, they will be provided by the other Contracting Party with a regime in relation to restitution, compensation, compensation or other solution, no less favorable than the one that the latter Contracting Party provides to its investors and any third country. These amounts are subject to free transfer abroad.  

 Article 6 Expropriation 1. Investments of investors of either Contracting Party will not be nationalized, expropriated or subject to measures having an effect equivalent to nationalization or expropriation (hereinafter referred to as "expropriation") in the territory of the other Contracting Party, except for public purposes. Expropriation will be conducted in accordance with legal proceedings, on a non-discriminatory basis, and will be accompanied by conditions  Articlepropriation 1. Investments of investors of either Contracting Party will not be nationalized, expropriated or subject to measures having an effect equivalent to nationalization or expropriation (hereinafter referred to as "expropriation") in the territory of the other Contracting Party, except for public purposes. Expropriation will be conducted in accordance with legal proceedings, on a non-discriminatory basis, and will be accompanied by conditions for the payment of immediate, adequate and effective compensation. Such compensation will be equal to the market price of the investment when the expropriation or threat of expropriation became publicly known, will include interest from the date of expropriation at the rate of LIV, will be paid in the currency in which the investment was made, or by agreement of the Contracting Parties in any other currency acceptable to the investor, will be made without delay, will be such that it is effectively implemented and freely translated. 2. The aggrieved investor will have the right to an immediate review by the judicid investor will have the right to an immediate review by the judicial authority of this Contracting Party of his case, and an assessment of his investments in accordance with the principles set out in this article. 3. The provisions of paragraph 1 of this Article will also apply when a Contracting Party expropriates the assets of a company that has acquired the status of a joint-stock company or is based in accordance with applicable law in any part of its own territory and in which investors of the other Contracting Party have shares.  

Article 7 Transfers 1. The Contracting Parties guarantee the transfer of payments related to investments and income in accordance with the applicable legislation of the Contracting Parties. Transfers will be made without any restrictions or delays. Such transfers will include, in particular, but not exclusively: a) capital and additional monetary amounts to support or increase investments; b) income, interest, dividends and other current income; c) payments made in accordance with loan agreements related to investments; d) royalties or fees for services; e) proceeds from the sale or liquidation of investments; f) earnings of individuals in accordance with the laws and regulations of the Contracting Parties, received by them in connection with investments in the territory of this Contracting Party. 2. For the purposes of this Agreement, the exchange rates will be the official rates that are valid for current agreements on the date of transfer, unless otherwise agreed.

Article 8 Subrogation 1. If a Contracting Party or its intermediary makes payments to its own investors in accordance with the guarantee it has provided in connection with an investment in the territory of the other Contracting Party, the latter Contracting Party recognizes: a) the transfer, either by law or under a legal agreement in that country, of any right or claim of the investor to the first Contracting Party or to her designated intermediary; b) that the first Contracting Party or its designated intermediary has obtained the right as a result of subrogation to exercise the rights and make demands of this investor and will assume obligations related to this investment. 2. The rights or claims obtained as a result of subrogation will not exceed the rights and requirements of the investor.  

Article 9 Disputes between a Contracting Party and an investor of the other Contracting Party 1. For the purpose of a dispute between an investor of one Contracting Party and an investor of the other Contracting Party in relation to an investment, without prejudice to the provisions of Article 10 of this Agreement, negotiations will be conducted between the Parties concerned. If any dispute between an investor of one Contracting Party and the other Contracting Party cannot be resolved in this way within six months from the date of the written request, the investor will have the right to refer the case: a) to the judicial authority of the Contracting Party in whose territory the investment is being carried out, or b) to the International Center for the Decision Investment Disputes (ICSID), bearing in mind the relevant terms of the Convention on the Settlement of Investment Disputes between States and Citizens of Other States, which was opened for signature in Washington, D.C., on March 18, 1965, in the event that both Contracting Parties became parties to this Convention, or (c) to an arbitrator or to an international ad hoc arbitral tribunal established in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL). The arbitral awards will be final and binding on both Parties to the dispute.

Article 10 Settlement of disputes between the Contracting Parties 1. Disputes between the Contracting Parties concerning the interpretation or application of this Agreement will be resolved through diplomatic channels. 2. If such a dispute cannot be resolved in this way within six months of its commencement, it will, at the request of either Contracting Party, be submitted to Arbitration in accordance with the provisions of this article. 3. The Arbitration Court will be established for each individual case as follows: within two months of receiving a written request for an arbitration award, each of the Contracting Parties will appoint one member of this Court. These two members will then elect a citizen of a third State, who, after his approval by the Contracting Parties, will be appointed Chairman of the Court (hereinafter referred to as the "Chairman"). The Chairman will be appointed within three months from the date of appointment of the other two members. 4. If during any of the periods specified in paragraph 3 of this Article the necessary appointments have not been made, any Contracting Party may, in the absence of any other agreement, invite the President of the International Court of Justice to make the necessary appointments. If it turns out that he is a citizen of a Contracting Party or if other reasons prevent him from fulfilling this function, the Vice-Chairman will be invited to make the necessary appointments. If it turns out that the Vice-President is also a national of a Contracting Party or is unable to perform the specified function, the next-oldest member of the International Court of Justice, who does not have the nationality of any of the Contracting Parties, will be invited to make the necessary appointments and can perform the specified function without hindrance. 5. The Arbitration Court will reach its decisions by a majority vote. Such decisions will be binding on each Contracting Party. Each Contracting Party will bear the costs of its members of the court and its representation in the arbitration proceedings; the costs of the chairman and other costs will be borne in equal parts by both Contracting Parties. The Arbitration Court will determine which of the Contracting Parties will bear the majority of the costs.

Article 11 Application of other rules and special obligations 1. If the issue is regulated simultaneously by this Agreement and another international Agreement to which both Contracting Parties are parties, nothing in this Agreement will prevent the Contracting Parties or any of their investors who invest in the territory of the other Contracting Party from taking advantage of those rules that are more favorable in relation to their case. 2. If the treatment to be provided by one Contracting Party to the investors of the other Contracting Party was in accordance with its laws and regulations or other special provisions of the contracts, is more favorable than that provided by this Agreement, a more favorable one will be provided.  

 Article 12 Making changes and additions This Agreement may be amended and supplemented by written agreement between the Contracting Parties. Any amendment should enter into force if each of the Contracting Parties has notified the other Contracting Party that it has regulated all relevant formalities preventing the entry into force of such an amendment.  

 Article 13 Entry into force, duration and termination of the Agreement 1. Each Contracting Party will notify the other Contracting Party in writing of the completion of the procedures necessary under its current legislation for the entry into force of this Agreement. This Agreement will enter into force on the date of the last written notification. 2. This Agreement remains in force for ten years. Its validity will be automatically extended for the next 5 years, unless one of the Contracting Parties notifies the other Contracting Party in writing of its intention to terminate this Agreement at least six months before the expiration of the relevant period. 3. With respect to investments made prior to the termination of this Agreement, the terms of this Agreement (Articles 1-11) will remain in force for ten years from the date of termination.

Done in Tbilisi on September 17, 1996, in two valid copies, each in the Kazakh, Georgian and Russian languages, all texts being equally authentic. For the purposes of interpreting the provisions of this Agreement, the Russian text shall prevail.

For the Government For the Government of the Republic of Kazakhstan of Georgia

President

Republic of Kazakhstan

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