TREATIES AND OTHER INTERNATIONAL ACTS SERIES 13050 

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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

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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.

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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