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 function as
follows:

(i) Each Government shall appoint one arbitrator;
these two arbitrators shall, by agreement, designate a
president of the. arbitral. 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
Permanent Court of Arbitration to make the necessary
appointment or appointments, and both Governments agree
to accept such appointment or appointments.

(ii) The arbitral tribunal shall base its
decision on the applicable principles and rules of
international law. The arbitral tribunal shall decide
by majority vote. Its decision shall be final and

binding.


Georgia no less favorable as to use and conversion than the
treatment to which such funds would be entitled in the hands
of the party under Coverage.

(b} Such amounts 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 Georgia in accordance with its
laws.

(c) The provisions of this Article shall also apply to
any amounts ana credits in the currency of the Republic of
Georgia which may be accepted by the Issuer in settlement of

obligations with respect to loans made by the Issuer for

projects in the Republic of Georgia.

ARTICLE 5

(a) Any dispute between the Government of the United
States of America and the Government of the Republic of
Georgia regarding the interpretation of this Agreement or:
which, in the opinion of one of the Governments, presents a
question of international law arising out of any project or
activity for which Coverage has been issued shall be
resolved, insofar as possible, through negotiations between
the two Governments. If, at the end of six months following
the request for negotiations, the two Governments have not
resolved the dispute by agreement, the dispute, including

the question of whether such dispute presents a question of


(iii) During the proceedings, each of the
Governments shall pay the expense of its arbitrator and
of its representation in the proceedings before the
arbitral tribunal, whereas the expenses of the
president and other costs of arbitration shall be paid
in equal parts by the two Governments. In its award,
the arbitral tribunal may, in its discretion,
reallocate expenses and costs between the two
Governments.

(iv) In all other matters, the arbitral tribunal
shall regulate its own procedures.

(c) 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 of the Issuer.

ARTICLE 6

The two Governments, desiring reciprocity, agree that,
in the event the Government of the Republic of Georgia makes
arrangements to issue Coverage or make loans for projects in
the United States of America under a program similar in
substance to the investment incentive program to which this
Agreement relates, provisions equivalent to those of this
Agreement shall apply with respect to such arrangements upon
completion of the constitutional or other legal processes of

both Governments approving such provisions.


INVESTMENT INCENTIVE AGREEMENT BETWEEN
THE GOVERNMENT OF THE UNITED STATES OF AMERICA
AND THE GOVERNMENT OF THE REPUBLIC OF GEORGIA

The Government of the United States of America and the
Government of the Republic of Georgia;

Affirming their common desire to encourage economic
activities in the Republic of Georgia which promote the
development of the economic resources and productive capacities
of the Republic of Georgia; and

Recognizing that this objective can be promoted through
investment insurance (including reinsurance), loans and
investment guaranties which are backed in whole or in part by the
Government of the United States of America and provided by the
Overseas Private Investment Corporation ("OPIC"), an agency of
the Government of the United States of America;

Have agreed as follows:

ARTICLE 1
As used in this Agreement, the term "Coverage" shall
refer to any investment insurance, reinsurance or investment
guaranty which is provided by an Issuer in connection with a
project in the territory of the Republic of Georgia, and the
term "Issuer" shall refer to OPIC, any successor agency of
the Government of the United States of America, and the

agent of either.


-7-

ARTICLE 7

This Agreement shall continue in force until the
expiration of twelve months from the date on which either
Government shall have given written notice of termination of
this Agreement to the other. Provided that in respect of
Coverage issued or loans made at any time before the
termination of this Agreement, its provisions shall continue
in effect with respect to such Coverage or loans for a
period of twenty years after the:date of termination of this

Agreement.

This Agreement shall enter into force on the date of

signing.

DONE at Tbilisi on the 27th day of June, 1992, in duplicate,
in the English and Georgian languages. Any discrepancy between
the texts shall be resolved with reference to the English until,
by an exchange of diplomatic notes, the two texts have been

conformed, at which time both texts shall be equally authentic.

FOR THE GOVERNMENT OF FOR THE GOVERNMENT OF
THE REPUBLIC OF GEORGIA:

24s O72"



ARTICLE 2

(a) (i) If the Issuer makes payment to any party under

Coverage, the Government of the Republic of Georgia

shall, subject to the provisions of Article 3 of this

Agreement, recognize the transfer to the Issuer of any

assets, including those in the form of investment as

well as currency or credits, in connection with such
payment, 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.

(ii) If the Issuer, in the exercise of its rights
as a creditor, acquires any such assets or succeeds to
any right, title, claim, privilege or cause of action,
the Government of the Republic of Georgia shall,
subject to the provisions of Article 3 of this

Agreement, recognize such acquisition or succession.

(b) The Issuer shall assert no greater rights than
those of the party from whom such rights were acquired as -
described in paragraph (a) of this Article.

(c) The Issuer, as a non-commercial agency of the
Government of the United States of America, shall not be
subject to regulation under the laws of the Republic of
Georgia applicable to commercial insurance or financial
organizations.

(d) Interest and fees on loans made or guaranteed by

the Issuer shall be exempt from tax in the Republic of


Georgia. The Issuer shall not be subject to tax in the
Republic of Georgia as a result of any transfer, succession
or other acquisition described in paragraph (a) of this
Article. In all other cases, tax treatment of transactions
conducted by the Issuer in the Republic of Georgia shall be
determined by applicable law of the Republic of Georgia or
specific agreement between the Government of the United

States and the Government of the Republic of Georgia.

ARTICLE 3

To the extent that the laws of the Republic of Georgia
partially or wholly invalidate or prohibit the transfer,
succession or other acquisition, as described in Article
2(a) of this Agreement, of any interest in any property
within the territory of the Republic of Georgia by the
Issuer, the Government of the Republic of Georgia shall
permit the Issuer to make appropriate arrangements pursuant
to which such interests are transferred to a person or
entity permitted to own such interests under the laws of the

Republic of Georgia.

ARTICLE 4
(a) Amounts in the currency of the Republic of
Georgia, including credits thereof, acquired by the Issuer
in connection with payment to a party under Coverage shall

be accorded treatment in the territory of the Republic of