TREATIES AND OTHER INTERNATIONAL ACTS SERIES 4477

GUARANTY OF PRIVATE INVESTMENTS

Agreement Between the
Unirep StTaTES OF AMERICA
and NEpaL

Effected by Exchange of Notes
Signed at Washington May 17, 1960



5

no Jess favourable than that accorded, in like cir-
cumstances, to its nationals or nationals of third
countries, with reference to any reimbursement, com-
pensation, indemnification, or any other payment,
including the distribution of reparations received
from enemy countries, that the Government of the
Kingdom of Nepal may make or pay for losses in-
curred by reason of war; if the Government of the
United States of America makes payment in United
States dollars to any national of the United States
of America under a guaranty for losses by reason of
war, the Government of the Kingdom of Nepal will
recognize the transfer ‘to the Government of the
United States of America of any, right, privilege,
or interest, or any part thereof, that such nationals
may be granted or become entitled to as a result of the
aforementioned treatment by the Government of the
Kingdom of Nepal;

(e). The aforementioned subparagraph (c) with respect
to the arbitration of claims shall not be applicable
to the type of guaranties against. losses by reason of
war provided for in subparagraph (d).

Fpon receipt of a note from Your Excellency indicating that
the foregoing provisions are acceptable to the Government of the
Kingdom of Nepal, the Government of the United States of America
will consider that this note and your reply thereto constitute an
agreement between the two Governments on this subject, the agree-
ment to enter into force on the date of your note in reply.”

Ihave the honour to confirm to Your Excellency that the provisions
set forth in the said note are acceptable to His Majesty’s Government
of Nepal and that it is agreed that Your Excellency’s note and this
reply constitute an agreement between our two Governments on this
subject, the agreement to enter into force on the date of this note.

I avail myself of this opportunity to present to Your Excellency the
assurances of my highest consideration.

Surarna SHuMst
Deputy Prime Minister
of Nepal.

Wasnuineton, D.C.,
May 17, 1960.

His Excellency
C. Dovetas Ditiion,
Acting Secretary of State
Department of State
Washington D.C.

TIAS 4477

U.S. GOVERNMENT PRINTING OFFICE: 1960


2

of America of any currency, credits, assets, or investment on
account of which such payment is made, and the subrogation of
the Government of the United States of America to any right,
title, claim or cause of action existing in connection therewith;

(b) That rupee amounts acquired by the Government of the
United States of America pursuant to such guaranties shall be
accorded treatment not less favorable than that accorded to
private funds arising from transactions of United States na-
tionals which are comparable to the transactions covered by
such guaranties, and that such rupee amounts shall be freely
available to the Government of the United States of America
for administrative expenses;

(c) That any claim against the Government of the Kingdom of
Nepal to which the Government of the United States of America
may be subrogated as a result of any payment under such a
guaranty, shall be the subject of direct: negotiations between the
two Governments. If within a reasonable period, they are
unable to settle the claim by agreement, it shall be referred for
final and binding determination to a sole arbitrator selected by
mutual agreement. If the Governments are unable, within a
period of three months, to agree upon such selection, the arbi-
trator shall be one who may be designated by the President of
the International Court of Justice at the request of either
Government ;

(d) That if the Government of the United States of America
issues guaranties to cover losses by reason of war with respect
to investments in Nepal, the Government of the Kingdom of
Nepal agrees that nationals of the United States of America to
whom such guaranties have been issued, will be accorded by
the Government of the Kingdom of Nepal treatment no less
favorable than that accorded, in like circumstances, to its na-
tionals or nationals of third countries, with reference to any
reimbursement, compensation, indemnification, or any other
payment, including the distribution of reparations received
from enemy countries, that the Government of the Kingdom
of Nepal may make or pay for losses incurred by reason of war;
if the Government of the United States of America makes pay-
ment in United States dollars to any national of the United
States of America under a guaranty for losses by reason of war,
the Government of the Kingdom of Nepal will recognize the
transfer to the Government of the United States of America
of any right, privilege, or interest, or any part thereof, that such
nationals may be granted or become entitled to as a result of the
aforementioned treatment by the Government of the Kingdom
of Nepal;

TIAS 4477


NEPAL

Guaranty of Private Investments

Agreement effected by exchange of notes
Signed at Washington May 17, 1960;
Entered into force May 17, 1960.

The Acting Secretary of Stute to the Nepalese Deputy Prime
Minister

Department oF SratTe
WasHINGTon
May 17, 1960

ExcELLENCY :

Ihave the honor to refer to conversations which have recently taken
place between representatives of our two Governments relating to
guaranties authorized by Section 413(b) (4) of the Mutual Security
Act of 1954,["] as amended. I also have the honor to confirm the
following understandings reached as a result of these conversations:

1.

The Governments of the United States of America and of the
Kingdom of Nepal will, upon the request of either of them,
consult respecting projects in Nepal proposed by citizens of the
United States of America with respect to which guaranties
under Section 413(b) (4) of the Mutual Security Act of 1954,
as amended, have been made or are under consideration.

The Government of the United States of America agrees that
it will issue no guaranty with respect to any project unless it is
approved by the Government of the Kingdom of Nepal.

With respect to such guaranties extending to projects which are
approved by the Government of the Kingdom of Nepal in ac-
cordance with the provisions of the aforementioned Section
413(b) (4), the Government of the Kingdom of Nepal agrees:

(a) That if the Government of the United States of America
makes payment in United States dollars to any person under any
such guaranty, the Government of the Kingdom of Nepal will
recognize the transfer to the Government of the United States

‘68 Stat. 847 ; 22 U.S.C. § 1983 (b) (4).

56550—60 qd) TIAS 4477


@

4

3. With respect to such guaranties extending to projects which
are approved by the Government. of the Kingdom of Nepal
in accordance with the provisions of the aforementioned
Section of 418(b) (4), the Government of the Kingdom of
Nepal agrees:

TIAS 4477

(a).

(ec).

(a).

That if the Government of the United States of
America makes payment in United States dollars to
any person under such guaranty, the Government of
the Kingdom of Nepal will recognize the transfer
to the Government of the United States of America
of any currency, credits, assets, or investment on
account of which such payment is made, and the
subrogation of the Government of the United States
of America to any right, title, claim or cause of ac-
tion existing in connection therewith ;

That rupee amounts acquired by the Government
of the United States of America pursuant to such
guaranties shali be accorded treatment not less
favourable than that accorded to private funds aris-
ing from transactions of United States nationals
which are comparable to the transactions covered
by such guaranties, and that such rupee amounts
shall be freely available to the Government of
the United States of America for administrative
expenses;

That any claim against the Government of the King-
dom of Nepal to which the Government of the
United States of America may be subrogated as 2
result of any payment under such guaranty, shall
be the subject. of direct. negotiations between the two
Governments. If within a reasonable period, they
are unable to settle the claim by agreement, it shall
be referred for final and binding determination to a
sole arbitrator selected by mutual agreement. If
the Governments are unable, within a period of
three months, to agree upon such selection, the ar-
bitrator shall be one who may be designated by the
President of the International Court of Justice at
the request of either Government;

That if the Government of the United States of
America issues guaranties to cover losses by reason
of war with respect to investments in Nepal, the
Government of the Kingdom of Nepal agrees thai
nationals of the United States of America to whom
such guaranties have been issued, will be accorded by
the Government of the Kingdom of Nepal treatment


TREATIES AND OTHER INTERNATIONAL ACTS SERIES 5391

INVESTMENT GUARANTIES

Agreement Between the
UnirEep States OF AMERICA
and NEPAL

Relating to the Agreement of May 17, 1960

Effected by Exchange of Notes
Signed at Kathmandu June 4, 1963



(e) The aforementioned subparagraph (c) with respect to the
arbitration of claims shall not be applicable to the type of guar-
anties against losses by reason of war provided for in subpara-
graph (d).

Upon receipt of a note from Your Excellency indicating that the
foregoing provisions are acceptable to the Government of the King-
dom of Nepal, the Government of the United States of America will
consider that this note and your reply thereto constitute an agreement
between the two Governments on this subject, the agreement to enter
into force on the date of your note in reply.

Accept, Excellency, the renewed asssurances of my highest
consideration.

Dovetas Ditton
Acting Secretary of State of the
Onited States of America

His Excellency
General Susarna S. J. B. Rana,
Deputy Prime Minister of the
Kingdom of Nepal,
Washington, D.C.

The Nepalese Deputy Prime Minister to the Acting Seeretary of State

ROYAL NEPALESE EMBASSY

EXCELLENCY:
T have the honour to acknowledge the receipt of Your Excellency’s
note of May 17, 1960 which reads as follows:

“I have the honour to refer to conversations which have recently
taken place between representatives of our two Governments re-
lating to guaranties authorized by Section 413(b) (4) of the Mutual
Security Act of 1954, as amended. I also have the honour to con-
firm the following understandings reached as a result of these
conversations:

1. The Governments of the United States of America and the
Kingdom of Nepal will, upon the request of either of them,
consult respecting projects in Nepal proposed by citizens of
the United States of America with respect to which guaran-
ties under Section 413(b) (4) of the Mutual Security Act of
1954, as amended, have been made or are under consideration.

The Government of the United States of America agrees that
it will issue no guaranty with respect to any project unless it
is approved by the Government of the Kingdom of Nepal.

10

TIAS 4477


3

an Agreement between our two Governments on this subject, the
Agreement to enter into force on the date of your Note in reply.”

L have the honor to confirm to Your Excellency that the provisions
set forth in the said Note are acceptable to His Majesty’s Government
of Nepal and that it is agreed that Your Excellency’s Note and this
reply constitute an agreement between our two Governments on this
subject, the agreement to enter into force on the date of this Note.

Lavail myself of this opportunity to renew to Your Excellency the
assurances of my highest consideration.

Torsr Girt
Dr. Tulsi Giri
Minister for Foreign Affairs.

His Excellency
Henry E. Sressrins,
American Ambassador to Nepal,
Kathmandu. -

TIAS 5391

U.S, GOVERNMENT PRINTING OFFICE:S963,


2

Accept, Excellency, the renewed assurances of my highest
consideration.

Henry E Srepsins

Henry E. Stebbins
American Ambassador

His Excellency
Dr. Tus Grrr,
Minister of Foreign Affairs,
His Majesty’s Government of Nepal.

The Nepalese Minister of Foreign Affairs to the American
Ambassador

Ministry or Foreren Arrarrs
His Maszsty’s Government or Nps
KareManpv.
June 4, 1963.

EXceLLeNcy: ~ :
I have the honor to acknowledge the receipt of Your Excellency’s
Note of June 4, 1963, which reads as follows:

“T have the honor to refer to the Agreement effected by the Ex-
change of Notes of May 17, 1960, between our two Governments
relating to investment guaranties which may be issued by the Govern-
ment of the United States of America for investments in activities
in Nepal. After the conclusion of this agreement, legislation has
been enacted in the United States of America modifying and augment-
ing the coverage to be provided investors by investment guaranties
that may be issued by the Government of the United States of
America. .

“In the interest of facilitating and increasing the participation
of private enterprise in furthering the economic development of Nepal,
the Government of the United States of America is prepared to issue
investment guaranties providing such coverage as may be authorized
by the applicable United States legislation for appropriate invest-
ments in activities approved by your Government provided that your
Government agrees that the undertakings between our respective Gov-
ernments contained in the above-mentioned agreement will be appli-
cable to such guaranties. . os :

_ “Upon receipt of a Note from Your Excellency indicating that
the foregoing is acceptable to the Government of Nepal and that such
undertakings shall apply, the Government of the United States of
America will consider that this Note and your reply thereto constitute

‘TIAS.-5391


NEPAL

Investment Guaranties

Agreement relating to the agreement of May 17, 1960.
Effected by exchange of notes

Signed at Kathmandu June 4, 1963;

Entered into force June 4, 1963.

The American Ambassador to the Nepalese Minister of Foreign
Affairs

Empassy OF THE
Unrrep States or AMERICA
Karamanpu, Nera,
‘No: 281 : a : June 4, 1963.

Exceniency:

- [have the honor to refer to the Agreement effected by the Exchange
of Notes of May 17, 1960,[*] between our two Governments relating
to investment. guaranties which may be issued by the Government
of the United States of America for investment in activities in Nepal.
After the conclusion of this agreement, legislation has been enacted
in the United States of America modifying and augmenting the cov-
erage to be provided investors. by investment guaranties that may be
issued by the Government of the United States of America.

In the interest of facilitating and increasing the participation of
private enterprise in furthering the economic development of Nepal,
the Government of the United States of America is prepared to issue
investment guaranties providing such coverage as may be authorized
by. the applicable United States legislation for appropriate invest-
ments in activities approved by your Government provided that your
Government agrees that the undertakings between our respective
Governments contained in the above-mentioned agreement will be
applicable to such guaranties.

Upon receipt of aN ote from Your Excellency indicating that the
foregoing is acceptable to the Government of Nepal and “that such
undertakings shall apply, the Government of the United States of
America -will consider that this Note and your reply thereto constitute
an Agreement between our two Governments on this subject, the
Agreement to enter into force on the date of your Note in reply.

+ TIAS 4477 ; 11 UST 1396.

21-677-—63. qd) TIAS 5391