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t (b) This Agreement shall continue in force until six months from the date of 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.

IN WITNESS WHEREOF, the undersigned, duly authorized by their respective
Governments, have signed this Agreement.

Done at Sarajevo, Bosnia and Herzegovina, on the i day of July, 1996, in two
originals, in the English language.

FOR THE GOVERNMENT OF FOR THE GOVERNMENT OF
THE UNITED STATES OF AMERICA BOSNIA AND HERZEGOVINA
¢ [ i
WM «
© of, be
Ruth R. UT \c Dr. Neven Tomic”
Overseas Private Investment Minister of Foreign Trade and
Corporation International Communications


INVESTMENT INCENTIVE AGREEMENT
BETWEEN
THE GOVERNMENT OF THE UNITED STATES OF AMERICA
AND
THE GOVERNMENT OF BOSNIA AND HERZEGOVINA

THE GOVERNMENT OF THE UNITED STATES OF AMERICA AND THE GOVERNMENT
OF BOSNIA AND HERZEGOVINA,

AFFIRMING their common desire to encourage economic activities in Bosnia and
Herzegovina that promote the development of the economic resources and productive capacities
of Bosnia and Herzegovina; 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 to an entity duly
registered in accordance with the laws of Bosnia and Herzegovina in connection with a project in
the territory of Bosnia and Herzegovina. 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, excises, imposts, stamps, duties and charges imposed in the
territory of Bosnia and Herzegovina and all liabilities with respect thereto.

ARTICLE 2

(a) The Issuer shall not be subject to regulation under the laws of Bosnia and
Herzegovina applicable to insurance or financial organizations.


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(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.

(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 Bosnia and
Herzegovina 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 Bosnia and Herzegovina, 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 Bosnia and Herzegovina, shall be accorded treatment in the territory of
Bosnia and Herzegovina 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
Bosnia and Herzegovina in accordance with its laws.

ARTICLE 4

(a) Any dispute between the Government of the United States of America and the
Government of Bosnia and Herzegovina 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


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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 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:

@ 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.
Both Governments hereby agree to accept such appointment or appointments.

Gi) 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
Bosnia and Herzegovina notifies the Government of the United States of America that all legal
requirements for entry into force of this Agreement have been fulfilled. Upon so entering into
force, this Agreement shall replace and supersede, with respect to Bosnia and Herzegovina, the
agreement between the United States of America and the Socialist Federal Republic of
Yugoslavia effected by exchange of notes signed at Belgrade January 18, 1973, and any matter
relating to Investment Support or otherwise pending under such agreement shall be treated or
disposed of under the terms of this Agreement.