On the ratification of the Agreement between the Republic of Kazakhstan and the Republic of Azerbaijan on the support and facilitation of oil transportation from the Republic of Kazakhstan through the Caspian Sea and the territory of the Republic of Azerbaijan to international markets through the Baku-Tbilisi-Ceyhan system
Law of the Republic of Kazakhstan dated May 28, 2008 No. 35-IV
To ratify the Agreement between the Republic of Kazakhstan and the Republic of Azerbaijan on supporting and facilitating the transportation of oil from the Republic of Kazakhstan through the Caspian Sea and the territory of the Republic of Azerbaijan to international markets through the Baku-Tbilisi-Ceyhan system, signed in Almaty on June 16, 2006.
President of the Republic of Kazakhstan N. Nazarbayev
Agreement between the Republic of Kazakhstan and the Republic of Azerbaijan on support and assistance of oil transportation from the Republic of Kazakhstan through the Caspian Sea and the territory of the Republic of Azerbaijan to international markets through the Baku-Tbilisi-Ceyhan system
(Official website of the Ministry of Foreign Affairs of the Republic of Kazakhstan - Entered into force on June 24, 2008)
The Republic of Kazakhstan and the Republic of Azerbaijan, hereinafter referred to as the Parties, wishing to facilitate the creation of a trans-Caspian system for the transportation of oil from oil-loading terminals on the Kazakh coast of the Caspian Sea to the Baku-Tbilisi system - Ceyhan (BTC) through oil-filling/bulk terminals on the Azerbaijani coast of the Caspian Sea for further transportation to international markets through the territory of the Republic of Azerbaijan, taking into account that the purpose of the trans-Caspian system is to transport oil to international markets, and that the BTC system is the main route through the territory of the Republic of Azerbaijan for the export of oil produced in the Republic of Kazakhstan, to international markets, considering that the BTC system and the trans-Caspian system are two separate systems, Together, they form a single corridor for the transportation of energy resources and contribute to the creation of conditions for the transportation of oil from the Republic of Kazakhstan to international markets, taking into account that the provisions of the Agreement between the Republic of Kazakhstan and the Republic of Azerbaijan to support and facilitate the transportation of oil from the Republic of Kazakhstan through the Caspian Sea and the territory of the Republic of Azerbaijan to international markets through the Baku-Tbilisi-Ceyhan system (more - this Agreement) does not affect the provisions of the Agreement between the Republic of Azerbaijan, Georgia and the Republic of Turkey on the transportation of crude oil through the territories of the Republic of Azerbaijan, Georgia and the Republic of Turkey via the Baku-Tbilisi main export pipeline - Ceyhan on November 18, 1999, expressing the desire to ensure that a single corridor for the transportation of energy resources on a continuous basis meets international standards, recognizing the provisions of the Ankara Declaration of October 29, 1998 and the Istanbul Declaration of November 18, 1999, agreed as follows:
Article 1
The concepts used in this Agreement:
The BTC system is a pipeline (as well as auxiliary facilities and equipment), which is defined in the text of the Agreement between the Republic of Azerbaijan, Georgia and the Republic of Turkey on the transportation of crude oil through the territories of the Republic of Azerbaijan, Georgia and the Republic of Turkey via the Baku-Tbilisi-Ceyhan main export pipeline dated November 18, 1999 as a Transport System;
The Energy Charter Treaty is the Energy Charter Treaty of December 17, 1994, subject to amendments and additions ratified by the Parties and protocols thereto, binding on the Parties as of the date of signing this Treaty.;
Foreign currency is the freely convertible currency of a state that is not a Party to this Agreement, as well as international monetary units.;
An agreement is an agreement concluded between the Government of a Party, on the one hand, and one or more persons, hereinafter referred to as Project Investors, on the other hand, and establishing the conditions, rights and obligations of its participants in relation to the implementation of the Trans-Caspian Project.;
Sea Carrier is a person jointly authorized by the Governments of the Parties to carry out Oil transportation across the Caspian Sea from the terminal(s) on the coast of the Republic of Kazakhstan to the terminal(s) on the coast of the Republic of Azerbaijan using Tankers under the flags of the Parties within the framework of the Trans-Caspian System.;
A Joint Committee is a committee established by the Governments of the Parties to exercise the powers specified in Article 10 of this Treaty.;
A person is any natural or legal person, including a corporate entity, partnership, joint venture, or other institution or organization, regardless of the form of ownership.;
Oil - any liquid hydrocarbons, including crude oil and natural gas condensate;
A project Investor is any Person who is an investor in the Trans-Caspian project individually or along with other Persons on the basis of Agreements.;
A project vessel is a self-propelled or non-self-propelled floating vessel flying the flag of either Party, used for sea or port towing, as well as other work within the framework of the Trans-Caspian project.;
Tanker is a floating vessel flying the flag of either Party that is legally owned or used by a Maritime Carrier to transport Oil within the framework of the Trans-Caspian System.;
Trans-Caspian transport infrastructure - oil-loading/filling terminals on the Kazakh coast of the Caspian Sea, Tankers and Vessels of the project, oil-loading/filling terminals on the Azerbaijani coast of the Caspian Sea and connecting structures to the BTC System, the full list and composition of facilities of which will be determined in the relevant Agreements;
Trans-Caspian Project - works and services related to the design, construction and operation of the Trans-Caspian transport infrastructure;
The Trans-Caspian system is a system for transporting Oil produced in the Republic of Kazakhstan to international markets using the Trans-Caspian transport infrastructure.
Article 2
The Parties shall make all necessary efforts to facilitate the transportation of Oil through the Trans-Caspian system and to support the implementation of the Trans-Caspian Project in accordance with this Agreement and Agreements.
Article 3
3.1. The rights and obligations of the Project Investor in relation to the Trans-Caspian Transport Infrastructure are determined in accordance with the Agreements.
3.2. None of the Parties claims ownership of Oil transported through the Trans-Caspian transport infrastructure.
Article 4
4.1. Except as provided for in the Energy Charter Agreement, none of the Parties expropriates (whether directly or indirectly), requisitions or nationalizes (including any measures that contribute to this or have an equal result) any property (or part thereof). The investor of the project, used in the framework of the Trans-Caspian project.
4.2. The Parties shall not suspend the process or interfere with the transportation of Oil through the Trans-Caspian Transport Infrastructure, except in the following cases::
4.2.1. provided for by the relevant Agreement;
4.2.2. when the operation of the Trans-Caspian transport infrastructure poses a threat to the national security of the Party, the environment, public health and property of Persons;
4.2.3. when the operation of the Trans-Caspian transport infrastructure is carried out in violation of the safety regulations for oil transportation.
4.3. If one of the Parties takes any actions to suspend or impede the transportation of Oil through the Trans-Caspian transport infrastructure, except for the cases specified in clause 4.2. of this Agreement, such Party shall facilitate the resumption of transportation through the Trans-Caspian system within a reasonable time.
4.4. Subject to the observance of the interests of their States in relation to national security, public health and property of Persons, safety of work or environmental protection, each of the Parties:
4.4.1. grants each Investor of the project all the rights necessary for the implementation of the Trans-Caspian project to land and water within the territory under its sovereignty and/or jurisdiction on agreed transparent commercial terms in accordance with its national legislation;
4.4.2. if necessary, make reasonable efforts to grant or obtain from any Persons the rights of access to and use of land and water.
4.5. Each Party with respect to Tankers and Vessels of the project that are part of the Trans-Caspian Transport Infrastructure or used in connection with the Trans-Caspian Project, except in cases where such Tankers and Vessels of the project pose a threat to national security and/or the environment.:
4.5.1. grants the necessary access rights;
4.5.2. provides freedom of navigation;
4.5.3. provides non-discriminatory access to ports and terminals;
4.5.4. ensures fairness, transparency and non-discrimination in the determination of all types of mandatory port charges, customs duties and other similar mandatory payments and the avoidance of unreasonable delays in their application;
4.5.5. promotes the use of international standards applicable to marine commercial and transport terminals, timely and efficient execution of all necessary administrative procedures related to mooring and loading and unloading operations.
4.6. The Parties shall cooperate in order to apply common standards within the framework of the Trans-Caspian Project, consistent with the best international practices.
Article 5
5.1. Each Party, taking into account the interests of national security, in accordance with the procedures established by its national legislation, grants each Investor of the project the right to:
5.1.1. cross-border payments and transfers in Foreign currency;
5.1.2. exchange of Foreign currency at current market rates;
5.1.3. opening, use and maintenance of bank accounts in Foreign currency in the banks of the Parties.
Article 6
6.1. The Parties shall assist the Project Investor in attracting financing for the Trans-Caspian Project.
6.2. The investor of the project has the right to use his rights, ownership and participation in the Trans-Caspian transport infrastructure as collateral in agreement with the government of the Party with which the Agreement was concluded.
6.3. The Governments of the Parties shall allow any creditor or insurer for the Trans-Caspian Project to enter into this project and assume the obligations of the Project Investor by concluding an Agreement in case the Project Investor fails to fulfill its obligations to these persons.
Article 7
7.1. Taxation of activities under this Agreement is carried out in accordance with the national legislation of the Parties.
7.2. In cases of amendments to the national legislation of the Party leading to a deterioration in the taxation conditions for Project Investors under this Agreement, taxation of Project Investors will be carried out in accordance with the national legislation of the Party in force on the date of signing this Agreement.
Article 8
The Government of a Party has the right not to conclude an Agreement or to refuse to join it under conditions when the proposed Investor of the project and/or its proposals poses a threat to the national security of the Party concerned or to public health, property, or the environment.
Article 9
The Trans-Caspian transport infrastructure may be partially used to transport Oil via other transport routes without prejudice to the provisions of this Agreement. In order to avoid ambiguity, the transportation of Oil outside the Trans-Caspian system is not covered by the terms of this Agreement.
Article 10
10.1. Upon a written request from one Party, the other Party shall provide it with information regarding the fulfillment of obligations under this Agreement and the Agreement.
10.2. The Governments of the Parties shall establish a Joint Committee consisting of representatives from the Government of each Party in order to:
10.2.1. monitoring the execution of this Agreement and facilitating its implementation;
10.2.2. discussions and efforts to resolve any issues that may arise regarding this Agreement or the Trans-Caspian Project.
10.3. Within a reasonable time, but in any case not later than thirty (30) days after the entry into force of this Treaty in accordance with Article 12, the Government of one Party shall provide the Government of the other Party with a notification regarding its representatives.
10.4. Representatives of the Parties may be replaced according to the procedures established by the Joint Committee.
10.5. The Parties agree that representatives of the Project Investor may be invited to the meeting of the Joint Committee.
10.6. The procedure for the activities of the Joint Committee is determined by the Governments of the Parties.
10.7. The Joint Committee meets at least twice a year.
Article 11
11.1. In case of disagreements regarding the application or interpretation of this Agreement, the Parties resolve them through negotiations.
11.2. Disputes between the Governments of the Parties and the Investor of the Project are resolved in accordance with the procedure established in the relevant Agreement.
Article 12
12.1. This Agreement shall enter into force on the date of the last written notification of its ratification.
12.2. This Agreement shall terminate upon termination or expiration of all Agreements and upon fulfillment of all obligations both under this Agreement and under the Agreements. Done in Almaty, June 16, 2006, in two original copies, each in the Kazakh, Azerbaijani, Russian and English languages, all texts being equally authentic. In case of disagreement in the interpretation of the provisions of this Agreement, the text in Russian is used.
For the Republic of Azerbaijan The Republic of Kazakhstan
President
Republic of Kazakhstan
© 2012. RSE na PHB "Institute of Legislation and Legal Information of the Republic of Kazakhstan" of the Ministry of Justice of the Republic of Kazakhstan
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