Source: EURLEX
Language: es
Format: md

###### **`COMISIÓN DE LAS COMUNIDADES EUROPEAS`**

```
                                 C0M(94) 405 final
                                 Bruselas, 21.09.1994

                                 94/0214 (CNS)

     COMUNICACIÓN DE LA COMISIÓN AL CONSEJO Y AL PARLAMENTO EUROPEO

```

para la firma y la aplicación provisional por parte de las Comunidades Europeas del

Tratado de la Carta de la Energía

**PROPUESTA DE DECISION DEL CONSEJO**

**RELATIVA A LA FIRMA**

```
94/0214 (CNS)

```

**DEL TRATADO DE LA CARTA EUROPEA DE LA ENERGÍA**

**Y A SU APLICACIÓN PROVISIONAL**

**POR PARTE DE LA COMUNIDAD EUROPEA**

```
           (presentada por la Comisión)

```

**PROYECTO DE DECISIÓN DEL CONSEJO Y DE LA COMISIÓN**

**RELATIVA** **A LA FIRMA**

**DEL TRATADO DE LA CARTA EUROPEA DE LA ENERGÍA**

**Y A SU APLICACIÓN PROVISIONAL**

**POR PARTE DE LA COMUNIDAD EUROPEA DEL CARBÓN**

**Y DEL ACERO**

**Y DE LA COMUNIDAD EUROPEA DE LA ENERGÍA ATÓMICA**

```
    COMUNICACIÓN DE LA COMISIÓN AL CONSEJO Y AL PARLAMENTO EUROPEO

```

para la firma y la aplicación provisional por parte de las Comunidades Europeas del

Tratado de la Carta de la Energía

1. El **Presidente de la** Conferencia de negociación de **la Carta de la** Energía **remitió el** 14
de **Septiembre 94 a las** partes de la negociación del Tratado **de la** Carta de **la Energía el**
**proyecto de Tratado** y de Acta Final resultado de tres anos **de** negociaciones **tras** la **fínna**

de **dicha** **Carta** **en diciembre de** 1991.

2. El análisis de este Tratado se adjunta en anexo a la presente Comunicación. La
Comisión considera que la firma de este Tratado responde a los intereses de la
Comunidad Europea, teniendo en cuenta, por una parte, la situación de dependencia
creciente en materia de suministro de productos energéticos, y especialmente la reducción
de la producción carbonífera en Europa y de las inversiones en el sector nuclear, y, por
otra parte, los imperativos de cooperación económica entre la Unión Europea y los países
del Este europeo para propiciar el desarrollo económico y social en estos países y la
sensibilización en materia medioambiental

3. La firma de este Tratado implica, en virtud del artículo 45 del mismo, su aplicación
provisional por las diferentes partes. Ésta es la razón por la que la Comisión propone al
Consejo la firma y la aplicación provisional del mismo, sometiéndole a tal fin una
propuesta de decisión en virtud del Tratado CE, y un proyecto de decisión de la Comisión
en virtud del Tratado CECA y del Tratado CEEA, para el que se requiere el dictamen del
Consejo.

4 La Comisión considera que se ha de consultar al Parlamento sobre la propuesta de
decisión de firma y aplicación provisional. La aprobación definitiva del Tratado requerirá
el dictamen conforme del Parlamento con arreglo al párrafo segundo del apartado 3 del
artículo 228, en razón de sus implicaciones institucionales. La Comisión considera, sin
embargo, que para su aplicación provisional se podría seguir un procedimiento más
flexible; se propone, pues, solicitar al Parlamento un dictamen simple con arreglo al
procedimiento seguido para la aplicación provisional del Acuerdo por el que se crea un
Centro internacional para la ciencia y la tecnología, en Moscú (Reglamento n° 500/94 del
Consejo, de 21 de febrero de 1994).

5. La Comisión considera que la firma del Tratado por la Comunidad y su aplicación
provisional constituirán una etapa importante en el desarrollo de la cooperación con los
países de Europa central y oriental y con los países de la CEI. Por una parte, este Tratado
aportará una mayor seguridad jurídica a los inversores, concediéndoles el beneficio del
trato nacional, introducirá la obligación de transparencia en el trato de las inversiones y
dará a los países consumidores garantías de aprovisionamiento Por otra parte, las
modalidades de aplicación (Secretaría, Conferencia ministerial, reconocimiento de los
mecanismos de arbitraje, ) aportan ciertas garantías de vigilancia liste Tratado debe, sin
duda reforzarse, en la medida en que sólo aporta una garantía jurídica limitada a los

**nuevos inversores (preinversión); esta situación se aceptó, por un lado, para evitar la**
**paralización de las listas de excepción que los países del Este - en la situación evolutiva**
**actual de la legislación - no habrían dejado de introducir y, por otro, porque ya se ha**
**asumido el compromiso de iniciar la negociación de un segundo tratado sobre**
**preinversión a partir de enero de 1995.**

**6. La Comisión propone, pues, al Consejo que:**

**apruebe la decisión de firma y aplicación provisional anexa por parte de la**
**Comunidad Europea**

**emita dictamen conforme sobre el proyecto de** **decisión** **de la Comisión con**
**arreglo a las disposiciones del Tratado CECA, una vez comunicado el dictamen**
**del Comité Consultivo y**

**apruebe el proyecto de decisión de la Comisión con arreglo a las disposiciones del**
**Tratado CEEA.**

**2.**

**PROPUESTA DE DECISION DEL CONSEJO** **94/0214 (CNS)**

**RELATIVA A LA FIRMA**

**DEL TRATADO DE LA CARTA EUROPEA DE LA ENERGÍA**

**Y A SU APLICACIÓN PROVISIONAL**

**POR PARTE DE LA COMUNIDAD EUROPEA**

**EL CONSEJO DE LA UNION EUROPEA**

Visto el Tratado constitutivo de la Comunidad Europea y, en particular, el apartado 2 del artículo
73 C y los artículos 113 y 235, en conjunción con la segunda frase del apartado 2 y el párrafo
primero del apartado 3 del artículo 228,

Vista la propuesta de la Comisión,

Visto el dictamen del Parlamento Europeo,

Considerando que la Comunidad Europea y los Estados miembros firmaron la Carta Europea de
la Energía el 17 de diciembre de 1991;

Considerando que los signatarios de la Carta Europea de la Energía se comprometieron a
concertar el Tratado de la Carta Europea de la Energía para dotar a los principios y objetivos
establecidos por la misma de un marco jurídico internacional seguro y vinculante;

Considerando que la aplicación de la Carta Europea de la Energía es fundamental para el futuro
de Europa para que los Estados miembros de la CEI y los Países de Europa Central y Oriental
puedan desarrollar su potencial energético y contribuir a una mayor seguridad de abastecimiento;

Considerando que es conveniente consolidar la iniciativa y el papel central de la Comunidad,
facilitando su plena participación en la aplicación del Tratado;

A

Considerando que la firma y la aplicación del Tratado de la Carta Europea de la Energía
ayudarán a alcanzar los objetivos de la Comunidad y que para algunas de las medidas recogidas
en el Tratado, éste sólo prevé, para la adopción de esta decisión, los poderes establecidos en el
artículo 235;

Considerando, por tanto, que es oportuno firmar el Tratado en nombre de la Comunidad Europea,
a reserva de su posterior aprobación, y aplicarlo con carácter provisional, conforme a sus
disposiciones y sin perjuicio del procedimiento necesario para dicha aprobación,

DECIDE:

**Artículo 1**

1. La Comunidad Europea firmará el Tratado de la Carta Europea de la Energía, a reserva
de su posterior aprobación.

2. Se autoriza al Presidente del Consejo a designar a la persona o personas facultadas para
firmar el Tratado.

3. Se adjunta el texto del Tratado a esta decisión.

**Artículo 2**

El Tratado de la Carta Europea de la Energía se aplicará con carácter provisional desde el
momento de la firma.

Hecho en Bruselas,

U

**PROYECTO DE DECISION DEL CONSEJO Y** **PE** **LA COMISIÓN**

**RELATIVA A LA FIRMA**

**DEL TRATADO DE LA CARTA EUROPEA DE LA ENERGÍA**

**Y A** **Sü** **APLICACIÓN PROVISIONAL**

**POR PARTE DE LA COMUNIDAD EUROPEA DEL CARBÓN**

**Y DEL ACERO**

**Y DE LA COMUNIDAD EUROPEA DE LA ENERGÍA ATÓMICA**

**EL CONSEJO DE LA UNION EUROPEA**
**LA COMISIÓN DE LAS COMUNIDADES EUROPEAS**

**Visto el Tratado constitutivo de la Comunidad Europea del Carbón y del Acero y, en particular,**
**el párrafo primero del artículo 95,**

**Visto el Tratado constitutivo de la Comunidad Europea de la Energía Atómica y, en particular,**
**el párrafo segundo del artículo 101,**

**Visto el dictamen conforme** **el** **Consejo,**

**Previa consulta al Comité consultivo y** **del** **Parlamento Europeo,**

**Visto el proyecto de decisión del Consejo presentado por la Comisión,**

**Considerando que la Comunidad Europea y los Estados miembros** **firmaron** **la** **Carta Europea** **de**
**la Energía** **el** **17 de diciembre de** **1991;**

**Considerando que** **los** **signatarios de la Carta Europea de la Energía se comprometieron a**
**concertar el Tratado de la** **Carta** **Europea de la Energía para dotar a los** **principios** **y objetivos**
**establecidos por la misma de un marco** **jurídico** **internacional seguro y vinculante;**

**-S**

Considerando que la aplicación de la Carta Europea de la Energía es fundamental para el futuro
de Europa para que los Estados miembros de la CEI y los Países de Europa Central y Oriental
puedan desarrollar su potencial energético y contribuir a una mayor seguridad de abastecimiento;

Considerando que es conveniente consolidar la iniciativa y el papel central de la Comunidad,
facilitando su plena participación en la aplicación del Tratado;

Considerando que la firma y la aplicación del Tratado de la Carta Europea de la Energía
ayudarán a alcanzar los objetivos de las Comunidades CECA y CEEA y que para las medidas
recogidas en el Tratado, éste sólo prevé, para la adopción de esta decisión, los poderes
establecidos en el artículo 95;

Considerando, por tanto, que es oportuno firmar el Tratado en nombre de la Comunidad Europea
del Carbón y del Acero y de la Comunidad Europea de la Energía Atómica, a reserva de su
posterior aprobación, y aplicarlo con carácter provisional, conforme a sus disposiciones y sin
perjuicio del procedimiento necesario para dicha aprobación,

DECIDEN:

**Artículo 1**

La Comunidad Europea del Carbón y del Acero y la Comunidad Europea de la Energía
Atómica firmarán el Tratado de la Carta Europea de la Energía, a reserva de su posterior
aprobación.

Se adjunta el texto del Tratado a esta decisión.

**Artículo 2**

El Tratado de la Carta Europea de la Energía se aplicará con carácter provisional desde el
momento de la firma.

Hecho en Bruselas,

```
                 ANEXO

         RESUMEN DEL CONTENIDO
   DEL TRATADO DE LA CARTA EUROPEA DE LA ENERGÍA

```

La idea de una Comunidad Europea de la Energía fue sugerida por el Primer Ministro
neerlandés Lubbers en la reunión del Consejo Europeo celebrada en Dublin el 25 de junio
de 1990. Esta iniciativa tiene por objeto poner a disposición de los países de Europa
central y oriental (PECO) y, especialmente, las nuevas repúblicas independientes de la
antigua Unión Soviética (NEI), la tecnología, los conocimientos prácticos y los capitales
necesarios para llevar a cabo actividades de prospección, desarrollo y explotación de sus
yacimientos de petróleo y gas natural. De este modo se contribuiría al desarrollo
económico de esos países y, al mismo tiempo, los países consumidores obtendrían una
mayor seguridad de abastecimiento de petróleo y gas natural. Un proyecto tan ambicioso
como éste tenía que llevarse a cabo necesariamente en el sector de la energía porque es
el que ofrece mejores perspectivas de beneficios económicos rápidos y tangibles para las
dos partes.

La Conferencia sobre la Seguridad y la Cooperación en Europa (CSCE), reunida en París
del 19 al 21 de noviembre de 1990, manifestó su apoyo al plan Lubbers. Tanto Lubbers
como Delors sugirieron la organización de una conferencia en el curso de la cual se
podría negociar un proyecto de **carta europea de la energía** elaborado por la Comisión
Europea.

**LA CARTA DE LA** **ENERGÍA:** **UN COMPROMISO POLITICO**

Las negociaciones tuvieron lugar a lo largo del segundo semestre de 1991, con la
participación de todos los países europeos, incluidos los de Europa central y oriental y
los de la antigua URSS. Al final de largas discusiones en el Consejo de Asuntos
Generales de junio de 1991, se decidió invitar a los EE.UU. -que lo habían solicitado
persistentemente- y a los demás países no europeos de la OCDE a sumarse a la
Conferencia.

En virtud de lo dispuesto en el Documento final de la Conferencia de La Haya sobre la
Carta Europea de la Energía, los representantes de cuarenta y ocho Estados y de la CE
firmaron el acuerdo, el 17 de diciembre de 1991, con los objetivos y principios de la
Carta.

Los objetivos de la Carta, de gran alcance, son: la mejora de la seguridad de
abastecimiento, la optimización de la eficacia de la producción, de la conversión, del
transporte, de la distribución y de la utilización de la energía, el refuerzo de la seguridad
y la reducción al mínimo de los problemas medioambientales.

Estos objetivos deben lograrse respetando cuatro principios:

1) el principio de la soberanía y del derecho soberano de los Estados sobre sus
recursos naturales
2) el principio de la no discriminación
3) el principio de una formación de los precios conforme a la orientaciones del
mercado
4) el principio de la reducción al mínimo de los problemas medioambientales.

La Carta describe en detalle la manera de alcanzar los objetivos enumerados
anteriormente en ocho ámbitos:

1) acceso a los recursos energéticos y desarrollo de los mismos
2) acceso a los mercados
3) liberalización del comercio energético
4) fomento y protección de las inversiones
5) principios y líneas directrices de la seguridad
6) investigación, desarrollo tecnológico, innovación y difusión
7) eficacia energética y protección del medio ambiente
8) educación y formación.

```
EL PROYECTO DE TRATADO DE LA CARTA DE LA ENERGÍA

```

La Carta establece que **"los** **signatarios se comprometen a perseguir los objetivos y**
**los principios de la Carta y a aplicar y ampliar su** **cooperación** **en el plazo más breve**
**posible mediante un Tratado negociado de buena fe".**

Contrariamente a la Carta, que constituye una declaración de intenciones política, el
**Tratado** está pensado para que sea jurídicamente vinculante estableciendo derechos y
obligaciones para todas las partes contratantes. El Tratado consta de un preámbulo y de
una cincuentena de artículos repartidos en ocho partes diferentes y está completado con
varios anexos.

Además, las partes contratantes han emprendido la negociación paralela de dos
protocolos sectoriales sobre la eficacia energética y la seguridad nuclear.

###### **a**

```
CONTENIDO DEL TRATADO DE LA CARTA

```

El Tratado establece que el **comercio** de materias y productos energéticos entre las partes
contratantes se rige por las disposiciones del Acuerdo General sobre Aranceles y
Comercio (GATT) y por sus instrumentos conexos, incluidas las partes contratantes que
no son signatarias del GATT. Por lo que respecta a los países no integrados en el GATT,
el Tratado de la Carta Europea de la Energía prevé, mutatis mutandis, la aplicación de
las reglas del GATT.

Con arreglo al TCE, es posible aplicar al comercio nuclear una excepción específica en
relación con las disposiciones del GATT. Así pues, Rusia y la CE convinieron aplicar el
artículo 22 ACP en el marco de la Carta. Esta aplicación no está sujeta a una limitación
de carácter temporal pero -por coherencia con el artículo 22 ACP- se ha previsto la
posibilidad de un futuro nuevo acuerdo sobre el comercio nuclear entre Rusia y la
Comunidad. Se está buscando una solución similar para las demás repúblicas de la CEI.

Conviene señalar que las ayudas de estado que determinados Estados miembros conceden
a la producción nacional de carbón al amparo del Tratado CECA han sido objeto de una
protección apropiada.

*******

El Tratado reconoce asimismo **la soberanía de los Estados sobre los recursos**
**energéticos** y estipula en particular que los Estados "conservan el derecho a determinar
dentro de su territorio las zonas geográficas que han de ser destinadas a la prospección
y explotación de recursos energéticos" y "a decidir cuál ha de ser el ritmo de extracción
o explotación de los mismos". No obstante, las partes contratantes se comprometerán a
facilitar el acceso a los recursos y, por consiguiente, a garantizar la transparencia y el
carácter no discriminatorio de las normas de exploración, desarrollo y adquisición de los
recursos energéticos.

*******

El Tratado garantizará asimismo el **acceso a los mercados** de todas las partes contratantes
teniendo en cuenta la necesidad de permitir el libre juego de las fuerzas del mercado y
de fomentar la competencia.

*******

Además de reglas comerciales, el Tratado garantiza que los países y los inversores puedan
**transitar** por los países terceros para transportar su energía hacia los mercados de
exportación. A este respecto, el Tratado estipula que todos los países afectados deben
adoptar las medidas necesarias para facilitar el tránsito, por ejemplo, a través de las redes
interconectadas de gas o electricidad; en particular, los países se abstendrán de
interrumpir los flujos de energía en caso de controversia sobre cualquier cuestión
relacionada con el tránsito hasta tanto no se haya encontrado una solución amigable o el
Tribunal no haya adoptado una decisión.

*******

**La promoción y protección de las inversiones** siempre se ha considerado como uno de
los principales aspectos del Tratado. El artículo 10, que es el elemento clave a este
respecto, tiene por objeto fomentar las inversiones y establecer la norma por la que debe
regirse el trato dado a los inversores extranjeros. El artículo obliga a las partes
contratantes a fomentar y crear condiciones estables, equitativas, favorables y
transparentes para que los inversores de otras partes contratantes realicen inversiones en
su territorio.

La aplicación del principio del "trato nacional" a las inversiones se convirtió
indiscutiblemente en uno de los puntos de la negociación más controvertidos. Al aceptar
este principio, una parte contratante se compromete a conceder a las empresas o
inversores extranjeros el mismo trato que a sus propios inversores o empresas.

Al final de las negociaciones, todas las partes contratantes llegaron a un acuerdo sobre
el principio del trato nacional en la fase posterior a la inversión en la cual se efectúa la
explotación.

No obstante, surgieron desacuerdos considerables entre las partes contratantes en cuanto
a la plena concesión del trato nacional en la fase previa a la inversión durante la cual se
efectúan, entre otras cosas, la adquisición de terrenos y equipo y la concesión de
licencias.

Se consideraron aceptables para la fase previa a la inversión determinadas excepciones.
a condición de que figurasen claramente mencionadas en un anexo y de que quedaran
congeladas y, hasta donde fuera posible, sujetas a una cláusula de reducción. Rusia se
declaró claramente incapaz de presentar una lista definitiva de excepciones dada la
ausencia actual de legislación nacional.

Para evitar un bloqueo del proceso de negociación sobre esta cuestión, la CE propuso un
**procedimiento en dos etapas** consistente en dos acuerdos completos y autónomos sujeto
a ratificación con arreglo a los procedimientos nacionales.

El acuerdo "primario" comprende todos los artículos del Tratado sobre los que se pudo
llegar a un acuerdo y que se refieren, en particular, al comercio, al tránsito, al acceso al
arbitraje internacional y al trato nacional a las inversiones en la fase posterior a la
inversión. Las inversiones de la fase previa a la inversión gozarán del trato más favorable
del trato nacional o del trato de nación más favorecida (NMF) acordado de forma
voluntaria.

El objetivo último del acuerdo "complementario" está inscrito en el acuerdo primario.
Todos los signatarios de este último se comprometen a extender la aplicación de las
disposiciones relativas al trato nacional a la fase previa a la inversión a partir de la firma
del acuerdo complementario.

Los signatarios dispondrán de un plazo de tres años (a partir del 1/1/1995) para negociar
las condiciones de aplicación del principio del trato nacional en la fase previa a la
inversión y las excepciones correspondientes. Al finalizar las negociaciones, el número
de excepciones que recoja la legislación existente y que se consideren necesarias en ese
momento debería ser el mínimo.

En ese plazo de tres años, una parte contratante podrá en cualquier momento
comprometerse voluntariamente a conceder a los inversores de otras partes contratantes
el trato más favorable entre el nacional y/o el de NMF.

*******

El **marco institucional del Tratado** lo constituyen dos órganos: la Conferencia de la
Carta y la Secretaría. La Conferencia de la Carta, que se reúne periódicamente, es el
único órgano decisorio para los siguientes asuntos: cumplir las obligaciones asignadas en
virtud del Tratado; vigilar y facilitar la aplicación del Tratado; coordinar las medidas
generales con arreglo al Tratado; adoptar los programas de trabajo que debe ejecutar la
Secretaría; aprobar las cuentas anuales y el presupuesto de la Secretaría; autorizar la
negociación y la aprobación de los Protocolos; aprobar las modificaciones del Tratado;
nombrar el Secretario General y tomar todas las decisiones necesarias para la creación
y el funcionamiento de la Secretaría.

Además, la Conferencia de la Carta deberá cooperar y utilizar lo más posible los servicios
y programas de otras instituciones y organizaciones que tengan competencias claramente
definidas en el ámbito de la energía. Las partes contratantes tienen derecho a contar con
un representante en la Conferencia de la Carta.

La Secretaría estará integrada por un Secretario General y por el personal mínimo
necesario para su eficaz funcionamiento. La Secretaría prestará a la Conferencia de la
Carta toda la asistencia necesaria para llevar a cabo sus funciones. La Secretaría
mantendrá un número reducido de efectivos, pero podrá delegar una parte de sus
funciones a otras instituciones existentes.

*******

**Aspectos ambientales**

**El artículo 22 se refiere específicamente a los aspectos ambientales del Tratado. El**
**artículo establece que las partes contratantes deberán poner todo su empeño en adoptar**
**medidas precautorias para evitar o reducir al mínimo el deterioro del medio** **ambiente.**
**Estas medidas deberán ser seguras, duraderas y rentables. El Tratado establece asimismo**

**que el que contamine pague los costes de la contaminación y seguidamente enumera una**
**serie de objetivos que se deberán reflejar en la política ambiental de las partes**
**contratantes.**

*******

**Protocolo sobre la eficacia energética**

**Además de las disposiciones sobre la protección del medio ambiente que figuran en el**
**texto del Tratado, se negoció un protocolo específico sobre la eficacia** **energética.** **Este**
**protocolo expone en** **mayor detalle medidas para** **mejorar** **la** **eficacia** **energéticay** **fomentar**
**el ahorro de energía.** **El** **objetivo principal de este protocolo es garantizar que las**
**actividades en los ámbitos de la** **energía,** **la explotación y el consumo final se lleven a**
**cabo con las debidas precauciones para reducir al mínimo los daños al medio ambiente.**

*******

**Participación de la Comunidad Europea en el Tratado**

**El** **Tratado prevé explícitamente la adhesión de estados u organizaciones regionales de**
**integración económica** **(ORIE)** **que hayan** **firmado** **la Carta.**

**La CE dispone de** **un** **número de votos igual al número de sus Estados miembros que son**
**paites** **contratantes del Tratado y no podrá usar su derecho de voto cuando los Estados**
**miembros usen su derecho de voto y** **viceversa.**

**Por otra parte, une cláusula específica ha sido incluida con el fin de proteger la**
**legislación comunitaria existente y su carácter evolutivo.**

**Solución de controversias**

**De la solución de las controversias se ocupa fundamentalmente las** **parte** **V del Tratado,**
**de la que constituye una de las disposiciones más importantes. Las controversias se**
**subdividen en controversias entre partes contratantes y controversias entre inversores y**
**partes contratantes.**

**1.** **Las controversias entre partes contratantes por cuestiones comerciales** **implican,**
**si las partes contratantes son signatarias del GATT, un recurso a los mecanismos**
**de solución de controversias** **del** **GATT. Si una** **o varias partes** **contratantes no son**
**partes del GATT, se recurrirá a un procedimiento ad hoc análogo al del** **GATT.**

**Se han previsto procedimientos especiales de arbitraje para ios casos en que las**
**controversias se refieran a la aplicación o interpretación del presente acuerdo.**

### **u**

**2.** **En relación con las controversias entre una parte contratante y un inversor, en el**
**artículo 30 se han establecido mecanismos optativos de solución de controversias.**
**En ese mismo artículo se establece asimismo que las partes consienten**
**incondicional m** **ente en someter sus controversias a arbitraje internacional.**

**Los mecanismos de solución de controversias incluidos en el Tratado se pueden comparar**
**favorablemente con los mecanismos establecidos en otros tratados. Conviene señalar a**

**este respecto que dichos mecanismos prevén soluciones definitivas y obligatorias a**
**numerosas controversias.**

*******

**Disposiciones transitorias**

**El Tratado prevé que, una vez firmado y ratificado, no todas sus disposiciones sean**
**aplicadas inmediatamente por todos los signatarios de manera uniforme. Los países en**
**transición que tengan necesidad de tiempo para adaptarse a los requisitos de una**
**economía de mercado podrán beneficiarse de disposiciones transitorias.**

**Esas disposiciones transitorias se refieren a un número limitado de artículos que tratan**
**fundamentalmente de la competencia y el tránsito. En cada solicitud de acogida a una**
**disposición transitoria se indicará:**

**1)** **el artículo o los artículos que un Estado no está en condiciones de respetar**
**2)** **las razones objetivas de esa incapacidad**
**3)** **la naturaleza de las disposiciones transitorias**
**4)** **la duración de las disposiciones transitorias**
**5)** **las medidas adoptadas o previstas por un Estado para garantizar, lo más**
**rápidamente posible, el respeto de todas las obligaciones que se derivan del**
**Tratado.**

**Evidentemente, la duración de las disposiciones transitorias deberá ser lo más corta**
**posible. Por esta razón, las partes contratantes convinieron en fijar el 1 de julio de 2001**
**como la fecha a partir de la cual será obligatorio el cumplimiento de todas las**
**obligaciones del Tratado.**

*******

**Ámbito** **del Tratado**

**En su versión actual, el Tratado solamente se aplica a las materias y productos**
**energéticos definidos en el apartado 4 del artículo 1. Ha quedado aplazada una decisión**
**sobre la inclusión de determinados equipos y servicios que será objeto de negociaciones**
**separadas en forma de un Protocolo tras la firma del Tratado.**

**Entrada en vigor**

**EL Tratado entrará en vigor una vez lo hayan ratificado treinta signatarios. Mientras**
**tanto,** **varias disposiciones regulan la aplicación provisional del Tratado por los signatarios**
**en la medida en que se lo permiten su constitución, legislación o reglamentación.**

**•>/..-,**

```
                            14 September 1994

###### **FINAL ACT OF THE EUROPEAN** **ENERGY CHARTER CONFERENCE**

The final Plenary Session of the European Energy Charter

Conference was held at Lisbon on 16-17 December 1994.

Representatives of Albania, Armenia, Australia, Austria,

Azerbaijan, Belgium, Belarus, Bulgaria, Canada, Croatia, Cyprus,

the Czech Republic, Denmark, Estonia,, the European Community,

Finland, France, Georgia, Germany, Greece, Hungary, Iceland,

Ireland, Italy, Japan, Kazakhstan, Kyrghyzstan, Latvia,

Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, the

Netherlands, Norway, Poland, Portugal, Romania, the Russian

Federation, Slovakia, Slovenia, Spain, Sweden, Switzerland,

Tadjikistan, Turkey, Turkmenistan, Ukraine, the United Kingdom,

the United States, of America and Uzbekistan (hereinafter

referred to as "the representatives") participated in the

Conference, as did invited observers from certain countries and

international organizations.

               BACKGROUND

During the meeting of the European Council in Dublin in June

```

`1990,` _the_ `Prime` `Minister` `of the` `Netherlands suggested` `that`

```
economic recovery in Eastern Europe and the then Soviet Union

could be catalysed and accelerated by co-operation in the energy

```

```
                - 2

sector. This suggestion was welcomed by the Council, which

invited the Commission of the European Communities to study how

best to implement such co-operation. In February 1991 the

Commission proposed the concept of a European Energy Charter.

Following discussion of the Commission's proposal in the EC

Council of Ministers, the European Community invited the other

countries of Western and Eastern Europe, the Soviet Union and

the non-European members of the OECD to attend a Conference in

Brussels in July 1991 to launch negotiations on the European

Energy Charter. A number of other countries and international

organizations were invited to attend the Energy Charter

Conference as observers.

Negotiations on the European Energy Charter were completed in

1991 and the Charter was adopted by signature of a Concluding

Document at a Conference held at The Hague on 16-17 December

1991. Signatories of the Charter, then or subsequently, include

all those listed in Section I above, other than observers.

The signatories of the European Energy Charter undertook

"to pursue the objectives and principles of the Charter and

implement and broaden their co-operation as soon as possible by

negotiating in good faith a Basic Agreement and Protocols".

The Charter Conference accordingly began negotiations on a Basic

Agreement - later called the Energy Charter Treaty - designed to

promote East-West industrial co-operation by providing legal

safeguards in areas such as investment, transit and trade. The

Conference also began negotiations on Protocols in the fields of

Energy Efficiency, Nuclear Safety and Hydrocarbons, although in

the last case negotiations were later suspended until completion

of the Charter Treaty.

Negotiations on the Energy Charter Treaty and the Energy

Efficiency Protocol were successfully completed in 1994.

```

```
                   - 3

             THE ENERGY CHARTER TREATY

    As a result of its deliberations the Conference has adopted the

    text of the Energy Charter Treaty (hereinafter referred to as

    "the Treaty") which is set out in Annex 1 and Decisions with

    respect thereto which are set out in Annex 2 and agreed that

    the Treaty would be open for signature at Lisbon from

    17 December 1994 to 16 June 1995.

                UNDERSTAND INGS

V. By signing the Final Act, the representatives agreed to adopt

    the following Understandings with respect to the Treaty:

    1 . With respect to the Treaty as a whole

      (a) The representatives underline that the provisions of

         the Treaty have been agreed upon bearing in mind the

         specific nature of the Treaty aiming at a legal

         framework to promote long-term co-operation in a

         particular sector and as a result cannot be construed

         to constitute a precedent in the context of other

         international negotiations.

      (b) The provisions of the Treaty do not:

         (i) oblige any Contracting Party to introduce

            mandatory Third Party Access; or

         (ii) prevent the use of tariff systems which, within a

            particular category of consumers, apply identical

            prices to customers in different locations.

      (c) Derogations from most favoured nation treatment are

         not intended to cover measures which are specific to an

         Investor or group of Investors, rather than applying

         genera My.

```

```
             - 4 
With respect to Article 1(5)

(a) The Contracting Parties understand that this Treaty

   confers no rights to engage in economic activities

   other than Economic Activities in the Energy Sector.

(b) The following activities are illustrative of Economic

   Activity in the Energy Sector:

   (i) prospecting and exploration for, and extraction

       of, e.g., oil, gas, coal and uranium; •

   (ii) construction and operation of power generation

       facilities, including those powered by wind and

       other renewable energy sources;

   (iii) land transportation, distribution, storage and

       supply of Energy Materials and Products, e.g.,

       by way of transmission and distribution grids

       and pipelines or dedicated rail lines, and

       construction of facilities for such, including

       the laying of oil, gas, and coal-slurry

       pipe I ines;

   (iv) removal and disposal of- wastes from energy

       related facilities such as power stations,

        including radioactive wastes from nuclear power

       stat ions ;

   (v) decommissioning of energy related facilities,

        including oil rigs, oil refineries and power

       generat ing plants;

   (vi) marketing and sale of, and trade in Energy

       Materials and Products, e.g., retail sales of

       gasol i ne ; and

   (vi i) research, consulting, planning, management and

       design activities related to the activities

       mentioned above, including those aimed at

        Improving Energy Efficiency.

```

```
               - 5 
3. With respect to Article 1(6)

  For greater clarity as to whether an Investment made in the

  Area of one Contracting Party is controlled, directly or

   indirectly, by an Investor of any other Contracting Party,

  control of an Investment means control in fact, determined

  after an examination of the actual circumstances in each

  situation. In any such examination, all relevant factors

  should be considered, including the Investor's

   (a) financial interest, including equity interest; in the

      Investment;

   (b) ability to exercise substantial influence over the

     management and operation of the Investment; and

   (c) ability to exercise substantial influence over the

     selection of members of the board of directors or any

     other managing body.

  Where there is doubt as to whether an investor controls,

  directly or indirectly, an Investment, an Investor claiming

  such control has the burden of proof that such control

  ex ists.

4. With respect to Article 1(8)

  Consistent with Australia's foreign investment policy, the

  establishment of a new mining or raw materials processing

  project in Australia with total investment of $A 10 million

  or more by a foreign interest, even where that foreign

   interest is already operating a similar business in

  Australia, is considered as the making of a new investment.

5. With respect to Article 1(12)

  The representatives recognize the necessity for adequate and

   effective protection of Intellectual Property rights

   according to the highest internationally accepted standards.

```

```
             - 6 
6. With respect to Article 5(1)

  The representatives' agreement to Article 5 is not meant to

   imply any position on whether or to what extent the

  provisions of the "Agreement on Trade-Related Measures"

  annexed to the Final Act of the Uruguay Round of

  Multilateral Trade Negotiations are implicit in articles III

  and XI of the GATT.

7. With respect to Article 6

   (a) The unilateral and concerted anti-competiti ve conduct

      referred to in Article 6(2) are to be defined by each

      Contracting Party in accordance with its laws and may

      include exploitative abuses.

   (b) "Enforcement" and "enforces" include action under the

      competition laws of a Contracting Party by way of

      investigation, legal proceeding, or administrative

      action as well as by way of any decision or further law

      granting or continuing an authorization.

8. With respect to Article 7(4)

   The applicable legislation would include provisions on

   environmental protection, land use, safety, or technical

   standards.

9. With respect to Articles 9. 10 and Part V

   As a Contracting Party's programmes which provide for public

   loans, grants, guarantees or insurance for facilitating

   trade or Investment abroad are not connected with Investment

   or related activities of Investors from other Contracting

   Parties in its Area, such programmes may be subject to

   constraints with respect to participation in them.

```

```
              7 
10. With respect to Article 10(4)

  The supplementary treaty will specify conditions for

  applying the Treatment described in Article 10(3). Those

  conditions will include, inter alia, provisions relating to

  the sale or other divestment of state assets (privatization)

  and to the dismantling of monopolies (demonopol ization).

11. With respect to Articles 10(4) and 29(6)

  Contracting Parties may consider any connection between the

  provisions of Article 29(6) and Article 10(4).

12. With respect to Article 14(5)

   It is intended that a Contracting Party which enters into an

  agreement referred to in Article 14(5) ensure that the

  conditions of such an agreement are not in contradiction

  with that Contracting Party's obligations under the Articles

  of Agreement of the International Monetary Fund.

13. With respect to Article 19(1)(i)

   It is for each Contracting Party to decide the extent to

  which the assessment and monitoring of environmental impacts

  should be subject to legal requirements, the authorities

  competent to take decisions in relation to such

   requirements, an.d the appropriate procedures to be followed.

14. With respect to Articles 22 and 23

  With regard to trade in Energy Materials and Products

  covered by Article 29, that Article contains the relevant

  provisions on these subjects.

```

```
             - 8

15. With respect to Article 24(1)

  Exceptions contained in the GATT and Related Instruments

  apply between particular Contracting Parties which are

  parties to the GATT, as recognized in Article 4. With

  respect to trade in Energy Materials and Products covered by

  Article 29, that Article contains the applicable exceptions.

16. With respect to Article 26(2)(a)

  Article 26(2)(a) should not be interpreted to require a

  Contracting Party to enact Part I I I of this Treaty into its

  domest ic law.

17. With respect to Articles 26 and 27

  The reference to treaty obligations in the penultimate

  sentence of Article 10(1) does not include decisions taken

  by international organizations, even if they are legally

  binding, or treaties which entered into force before 1

  January 1970.

18. With respect to Article 29(2)(a)

  (a) Where a provision of the GATT or a Related Instrument

     referred to in this paragraph provides for joint

     action by parties to the GATT, it is intended that the

     Charter Conference take such action.

   (b) The notion "applied on 1 March 1994, and practised with

      regard to Energy Materials and Products, by parties to

      the GATT among themselves" is not intended to refer to

     cases where a party to the GATT has invoked article

     XXXV of the GATT, thereby disapplying the GATT vis-à
     vis another party to the GATT, but nevertheless applies

     unilaterally on a de facto basis some provisions of the

     GATT vis-à-vis that other party to the GATT.

```

```
               - 9 
19. With respect to Article 33

  The provisional Charter Conference should at the earliest

  possible date decide how best to give effect to the goal of

  Title III of the European Energy Charter that Protocols be

  negotiated in areas of co-operation such as those listed in

  Title III of the Charter.

20. With respect to Article 34

   (a) The provisional Secretary-General should make

      immediate contact with other international bodies in

     order to discover the terms on which they might be

     willing to undertake tasks arising from the Treaty and

     the Charter. The provisional Secretary-General might

     report back to the provisional Charter Conference at

     the meeting which Article 45(4) requires to be convened

     not later than 180 days after the opening date for

     s ignature.

   (b) The Charter Conference should adopt the annual budget

     before the beginning of the financial year and approve

     the annual accounts.

21 . With respect to Article 34(3)(l)

  The technical changes to Annexes might for instance include,

  delisting of non-signatories or of signatories that after an

   appropriate interval have failed to ratify, or additions to

  Annexes N and VC. It is intended that the Secretariat would

   propose such changes to the Charter Conference when

   appropr iate.

22. With respect to Annex TFU(1)

   (a) If some of the parties to an agreement referred to in

      paragraph (1) have not signed or acceded to the Treaty

      at the time required for notification, those parties to

      the agreement which have signed or acceded to the

      Treaty may notify on their behalf.

```

```
                     10 
       (b) The need in general for notification of agreements of a

          purely commercial nature is not foreseen because such

          agreements should not raise a question of compliance

          with Article 29(2)(a), even when they are entered into

          by state agencies. The Charter Conference could,

          however, clarify for purposes of this Annex which types

          of agreements referred to in Article 29(2)(b) require

          notification under this Annex and which types do not.

                  DECLARATIONS

V. The representatives declared that Article 18(2) shall not be

    construed to allow the circumvention of the application of the

    other provisions of this Treaty.

VI. The representatives also noted the following Declarations that

    were made with respect to the Treaty:

    1. With respect to Article 1(6)

       The Russian Federation wishes to have reconsidered, in

       negotiations with regard to the supplementary treaty

       referred to in Article 10(4), the question of the

       importance of national legislation with respect to the issue

       of control as expressed in the Understanding to

       Art icle 1(6).

    2. With respect to Article 7

       The European Community and its member states and Austria,

       Norway, Sweden and Finland declare that the provisions of

       Article 7 are subject to the conventional rules of

       international law on jurisdiction over submarine cables and

       pipelines or, where there are no such rules, to general

       internat ionaI law.

```

```
                - 11

  They further declare that Article 7 is not intended to

   affect the interpretation of existing international law on

   jurisdiction over submarine cables and pipelines, and cannot

   be considered as doing so.

3. With respect to Article 10

   Canada and the United States each affirm that they will

   apply the provisions of Article 10 in accordance with the

   following considerations:

   For the purposes of assessing the treatment which must be

   accorded to Investors of other Contracting Parties and their

   Investments, the circumstances will need to be considered on

   a case by case basis. A comparison between the treatment

   accorded to Investors of one Contracting Party, or the

   Investments of Investors of one Contracting Party, and the

   Investments or Investors of another Contracting Party, is

   only valid if it is made between Investors and Investments

   in similar circumstances. In determining whether

   differential treatment of Investors or Investments is

   consistent with Article 10, two basic factors must be taken

   into account.

   The first factor is the policy objectives of Contracting

   Parties in various fields insofar as they are consistent

   with the principles of non-discrimination set out in Article

   10. Legitimate policy objectives may justify differential

   treatment of foreign Investors or their Investments in order

   to reflect a dissimilarity of relevant circumstances between

   those Investors and Investments and their domestic

   counterparts. For example, the objective of ensuring the

   integrity of a country's financial system would justify

   reasonable prudential measures with respect to foreign

   Investors or Investments, where such measures would be

   unnecessary to ensure the attainment of the same objectives

   insofar as domestic Investors or Investments are concerned.

   Those foreign Investors or their Investments would thus not

   be "in similar circumstances" to domestic Investors or their

```

```
               - 12 
   Investments. Thus, even if such a measure accorded

  differential treatment, it would not be contrary to

  Art icle 10.

  The second factor is the extent to which the measure is

  motivated by the fact that the relevant Investor or

   Investment is subject to foreign ownership or under foreign

  control. A measure aimed specifically at Investors because

  they are foreign, without sufficient countervailing policy

  reasons consistent with the preceding paragraph, would be

  contrary to the principles of Article 10. The foreign

   Investor or Investment would be "in similar circumstances"

  to domestic Investors and their Investments, and the measure

  would be contrary to Article 10.

4. With respect to Article 25

  The European Community and its member states recall that, in

  accordance with article 58 of the treaty establishing the

  European Community:

   (a) companies or firms formed in accordance with the law of

     a member state and having their registered office,

     central administration or principal place of business

     within the Community shall, for the right of

     establishment pursuant to Part Three, Title III,

     Chapter 2 of the treaty establishing the European

     Community, be treated in the same way as natural

     persons who are nationals of member states; companies

     or firms which only have their registered office within

      the Community must, for this purpose, have an effective

     and continuous link with the economy of one of the

     member states-,

   (b) "companies and firms" means companies or firms

     constituted under civil or commercial law, including

     co-operative societies, and other legal persons

     governed by public or private law, save for those which

      are non-prof itmaking.

```

```
               - 13 
  The European Community and its member states further recall

  that:

  Community law provides for the possibility to extend the

  treatment described above to branches and agencies of

  companies or firms not established in one of the member

  states; and that, the application of Article 25 of the

  Energy Charter Treaty will allow only those derogations

  necessary to safeguard the preferential treatment resulting

  from the wider process of economic integration resulting

  from the treaties establishing the European Communities.

5. With respect to Article 40

  Denmark recalls that the European Energy Charter does not

  apply to Greenland and the Faroe Islands until notice to

  this effect has been received from the local governments of

  Greenland and the Faroe Islands.

   In this respect Denmark affirms that Article 40 of the

  Treaty appl¡es to Greenland and the Faroe Islands.

6. With respect to Annex G(4)

   (a) The European Community and the Russian Federation

     declare that trade in nuclear materials between them

     shall be governed, until they reach another agreement,

     by the provisions of article 22 of the Agreement on

     Partnership and Cooperation signed at Corfu on 24 June

      1994, the exchange of letters attached thereto and the

     related joint declaration, and disputes regarding such

      trade will be subject to the procedures of the said

     Agreement.

   (b) The European Community declares that it intends to

     .conclude bilateral agreements for trade in nuclear

     materials with Ukraine, Kazakhstan, Kyrgyzstan,

     Tadjikistan and Uzbekistan. Procedures have been

     commenced to arrive at bilateral Declarations

```

```
                   - 14 
          confirming the agreement that nuclear trade between the

          European Community and those states shall be

          exclusively covered by these specific agreements and

          that until their entry into force the provisions of the

          Agreement between the European Economic Community, the

          European Atomic Energy Community and the Union of

          Soviet Socialist Republics on trade and economic and

          commercial co-operation signed in Brussels on 18

          December 1989 shall continue to apply.

          These Declarations are to be inserted in the Final Act.

          Once inserted, these bilateral Declarations will

          replace this unilateral one.

             THE ENERGY CHARTER PROTOCOL

     ON ENERGY EFFICIENCY AND RELATED ENVIRONMENTAL ASPECTS

VII. The Conference has adopted the text of the Protocol on Energy

    Efficiency and Related Environmental Aspects which is set out in

    Annex 3.

             THE EUROPEAN ENERGY CHARTER

V I M . The provisional Charter Conference and the Charter Conference

    provided for in the Treaty shall henceforth be responsible for

    making decisions on requests to sign the Concluding Document of

    the Hague Conference on the European Energy Charter and the

    European Energy Charter adopted thereby.

                 DOCUMENTATION

 X. The records of negotiations of the European Energy Charter

    Conference will be deposited with the Secretariat.

Done at Lisbon on the seventeenth day of December in the year one

thousand nine hundred and ninety-four.

```

_EUROPEAN ENERGY CHARTER_ _CONFERENCE_

## **ENERGY CHARTER TREATY**

_**Text for Adoption**_

_**14 September 1994**_

```
                               14 September 1994

                                    ANNEX 1

                TEXT FOR ADOPTION

```

**ENERGY CHARTER TREATY**

```
                   PREAMBLE

The Contracting Parties to this Treaty,

Having regard to the Charter of Paris for a New Europe signed on

21 November 1990;

Having regard to the European Energy Charter adopted in the Concluding

Document of the Hague Conference on the European Energy Charter signed

at The Hague on 17 December 1991;

Recalling that all signatories to the Concluding Document of the Hague

Conference undertook to pursue the objectives and principles of the

European Energy Charter and implement and broaden their co-operation as

soon as possible by negotiating in good faith an Energy Charter Treaty

and Protocols, and desiring to place the commitments contained in that

Charter on a secure and binding international legal basis;

Desiring also to establish the structural framework required to

implement the principles enunciated in the European Energy Charter;

Wishing to implement the basic concept of the European Energy Charter

initiative which is to catalyse economic growth by means of measures

to liberalize investment and trade in energy;

```

```
Affirming that Contracting Parties attach the utmost importance to the

effective implementation of full national treatment and most favoured

nation treatment, and that these commitments will be applied to the

Making of Investments pursuant to a supplementary treaty;

Having regard to the objective of progressive liberalization of

international trade and to the principle of avoidance of discrimination

in international trade as enunciated in the General Agreement on

Tariffs and Trade and its Related Instruments and as otherwise provided

for in this Treaty;

Determined progressively to remove technical, administrative and other

barriers to trade in Energy Materials and Products and related

equipment, technologies and services;

Looking to the eventual membership in the General Agreement on Tariffs

and Trade of those Contracting Parties which are not currently parties

thereto and concerned to provide interim trade arrangements which will

assist those Contracting Parties and not impede their preparation for

such membership;

Mindful of the rights and obligations of certain Contracting Parties

which are also parties to the General Agreement on Tariffs and Trade

and its Related Instruments;

Having regard to competition rules concerning mergers, monopolies,

anti-competiti ve practices and abuse of dominant position ;

Having regard also to the Treaty on the Non-Pro I iferation of Nuclear

Weapons, the Nuclear Suppliers Guidelines and other international

nuclear non-proliferation obligations or understandings;

Recognizing the necessity for the most efficient exploration,

production, conversion, storage, transport, distribution and use of

energy ;

```

```
                     - 3 
Recalling the United Nations Framework Convention on Climate Change,

the Convention on Long-Range Transboundary Air Pollution and its

protocols, and other international environmental agreements with

energy-related aspects -, and

Recognizing the increasingly urgent need for measures to protect the

environment, including the decommissioning of energy installations and

waste disposal, and for internationally agreed objectives and criteria

for these purposes:

HAVE AGREED AS FOLLOWS:

```

```
                    - 4 
                   PART I

           DEFINITIONS AND GENERAL PROVISIONS

                   ARTICLE 1

                  DEFINITIONS

For the purposes of this Treaty:

(1) "Charter" means the European Energy Charter adopted in the

   Concluding Document of the Hague Conference on the European Energy

   Charter signed at The Hague on 17 December 1991; signature of the

   Concluding Document is considered to be signature of the Charter.

(2) "Contracting Party" means a state or Regional Economic Integration

   Organization which has consented to be bound by this Treaty and

   for which the Treaty is in force.

(3) "Regional Economic Integration Organization" means an organization

   constituted by states to which they have transferred competence

   over certain matters a number of which are governed by this

   Treaty, including the authority to take decisions binding on them

   in respect of those matters.

(4) "Energy Materials and Products", based on the Harmonized System of

   the Customs Co-operation Council and the Combined Nomenclature of

   the European Communities, means the items included in Annex EM.

(5) "Economic Activity in the Energy Sector" means an economic

   activity concerning the exploration, extraction, refining,

   production, storage, land transport, transmission, distribution,

   trade, marketing, or sale of Energy Materials and Products except

   those included in Annex NI, or concerning the distribution of heat

   to multiple premises.

(6) "Investment" means every kind of asset, owned or controlled

   directly or indirectly by an Investor and includes:

```

```
                   - 5 
   (a) tangible and intangible, and movable and immovable,

      property, and any property rights such as leases, mortgages,

      I i ens, and pledges-,

   (b) a company or business enterprise, or shares, stock, or

      other forms of equity participation in a company or business

      enterprise, and bonds, and debt of, a company or business

      enterprise;

   (c) claims to money and claims to performance pursuant to

      contract having an economic value and associated with an

      Investment;

   (d) Intellectual Property;

   (e) Returns;

   (f) any right conferred by law, contract or by virtue of any

      licences and permits granted pursuant to law to undertake any

      Economic Activity in the Energy Sector.

   A change in the form in which assets are invested does not affect

   their character as investments and the term "Investment" includes

   all investments, whether existing at or made after the later of

   the dates of entry into force of this Treaty for the Contracting

   Party of the Investor making the investment and for the

   Contracting Party in the Area of which the investment is made

   (hereinafter referred to as the "Effective Date") provided that

   this Treaty shall only apply to matters affecting such investments

   after the Effective Date.

   "Investment" refers to any investment associated with an Economic

   Activity in the Energy Sector and to investments or classes of

   investments designated by a Contracting Party in its Area as

   "Charter efficiency projects" and so notified to the Secretariat.

(7) "Investor" means:

   (a) with respect to a Contracting Party

      (i) a natural person having the citizenship or nationality

         of or who is permanently residing in that Contracting

         Party in accordance with its applicable, law-,

```

```
                    - 6 
      (i i) a company or other organization organized in accordance

         with the law applicable in that Contracting Party

   (b) with respect to a "third state", a natural person, company or

      other organization which fulfils, mutatis mutandis, the

      conditions specified in sub-paragraph (a) for a Contracting

      Party.

(8) "Make Investments" and "Making of Investments" mean establishing

   new Investments, acquiring all or part of existing Investments or

   moving into different fields of Investment activity.

(9) "Returns" means the amounts derived from or associated with an

   Investment, irrespective of the form in which paid, including

   profits, dividends, interest, capital gains, royalty payments,

   management, technical assistance or other fees, and payments in

   kind.

(10) "Area" means with respect to a state that is a Contracting Party:

   (a) the territory under its sovereignty, it being understood that

      territory includes land, internal waters and the territorial

      sea ; and

   (b) subject to and in accordance with the international law of

      the sea: the sea, sea-bed and its subsoil with regard to

      which that Contracting Party exercises sovereign rights and

      jurisdiction.

   With respect to a Regional Economic Integration Organization which

   is a Contracting Party, Area means the Areas of the member states

   of such Organization, under the provisions contained in the

   agreement establishing that Organization.

(11) (a) "GATT" means "GATT 1947" and/or "GATT 1994", as appropriate.

      "GATT 1947" means the General Agreement on Tariffs and Trade,

      dated 30 October 1947, annexed to the Final Act Adopted at

      the Conclusion of the Second Session of the Preparatory

```

```
                     - 7 
      Committee of the United Nations Conference on Trade and

      Employment, as subsequently rectified, amended or modified.

      "GATT 1994" means the General Agreement on Tariffs and Trade

      as specified in Annex 1A of the Agreement Establishing the

      World Trade Organization, as subsequently rectified, amended

      or modified.

      A party to the Agreement Establishing the World Trade

      Organization is considered to be a party to GATT 1994.

   (b) "Related Instruments" means, as appropriate,

      (i) agreements, arrangements or other legal instruments,

          including decisions, declarations and understandings,

         concluded under the auspices of the GATT 1947 as

         subsequently rectified, amended or modified; and/or

      (ii) the Agreement Establishing the World Trade Organization

          including its Annex 1 (except GATT 1994), its Annexes 2,

         3 and 4, and the decisions, declarations and

         understandings related thereto, as subsequently

         rectified, amended or modified.

(12) "Intellectual Property" includes copyright and related rights,

   trademarks, geographical indications, industrial designs,

   patents, layout designs of integrated circuits and the protection

   of undisclosed information.

(13) (a) "Energy Charter Protocol" and "Protocol" mean a treaty, the

      negotiation of which is authorized and the text of which is

      adopted by the Charter Conference, which is entered into by

      two or more Contracting Parties in order to complement,

      supplement, extend or amplify the provisions of this Treaty

      with respect to any specific sector or category of activity

      within the scope of this Treaty, or to areas of co-operation

      pursuant to Title III of the Charter.

```

```
                    - 8 
   (b) "Energy Charter Declaration" and "Declaration" mean a legally

      non-binding agreement, the negotiation of which is authorized

      and the issuance of which is approved by the Charter

      Conference, which is entered into by two or more Contracting

      Parties to complement or supplement the provisions of this

      Treaty.

(14) "Freely Convertible Currency" means a currency which is widely

   traded in international foreign exchange markets and widely used

   in international transactions.

                   ARTICLE 2

               PURPOSE OF THE TREATY

This Treaty establishes a legal framework in order to promote long
term co-operation in the energy field, based on complementarities and

mutual benefits, in accordance with the objectives and principles of

the Charter .

```

```
                    - 9

                   PART I I

                   COMMERCE

                   ARTICLE 3

               INTERNATIONAL MARKETS

The Contracting Parties shall work to promote access to international

markets on commercial terms, and generally to develop an open and

competitive market, for Energy Materials and Products.

                   ARTICLE 4

       NON-DEROGATION FROM GATT AND RELATED INSTRUMENTS

Nothing in this Treaty shall derogate, as between particular

Contracting Parties which are parties to the GATT, from the provisions

of the GATT and Related Instruments as they are applied between those

Contracting Parties.

                   ARTICLE 5

            TRADE RELATED INVESTMENT MEASURES

(1) A Contracting Party shall not apply any trade related investment

   measure that is inconsistent with the provisions of article I I I or

   article XI of the GATT; this shall be without prejudice to the

   Contracting Party's rights and obligations under the GATT and

   Related Instruments and Article 29.

(2) Such measures include any investment measure which is mandatory or

   enforceable under domestic law or under any administrative ruling

   or compliance with which is necessary to obtain an advantage, and

   which requires:

```

```
                - 10 
   (a) the purchase or use by an enterprise of products of domestic

      origin or from any domestic source, whether specified in

      terms of particular products, in terms of volume or value of

      products, or in.terms of a proportion of volume or value of

      its local production;

   (b) that an enterprise's purchase or use of imported products be

      limited to an amount related to the volume or value of local

      products that it exports-,

   or which restr icts:

   (c) the importation by an enterprise of products used in or

      related to its local production, generally or to an amount

      related to the volume or value of local production that it

      exports;

   (d) the importation by an enterprise of products used in or

      related to its local production by restricting its access to

      foreign exchange to an amount related to the foreign exchange

      inflows attributable to the enterprise;

   (e) the exportation or sale for export by an enterprise of

      products, whether specified in terms of particular products,

      in terms of volume or value of products, or in terms of a

      proportion of volume or value of its local production.

(3) Nothing in paragraph (1) shall be construed to prevent a

   Contracting Party from applying the trade related investment

   measures described in paragraph (2)(a) and (c) as a condition of

   eligibility for export promotion, foreign aid, government

   procurement or preferential tariff or quota programmes.

(4) Notwithstanding paragraph (1), a Contracting Party may temporarily

   continue to maintain trade related investment measures which were

   in effect more than 180 days before its signature of this Treaty,

   subject to the notification and phase-out provisions set out in

   Annex TRM.

```

```
                   - 11

                  ARTICLE 6

                  COMPETITION

(1) Each Contracting Party shall work to alleviate market distortions

   and barriers to competition in Economic Activity in the Energy

   Sector.

(2) Each Contracting Party shall ensure that within its jurisdiction

   it has and enforces such laws as are necessary and appropriate to

   address unilateral and concerted ant i-competiti ve conduct in

   Economic Activity in the Energy Sector.

(3) Contracting Parties with experience in applying competition rules

   shall give full consideration to providing, upon request and

   within available resources, technical assistance on the

   development and implementation of competition rules to other

   Contracting Parties.

(4) Contracting Parties may co-operate in the enforcement of their

   competition rules by consulting and exchanging information.

(5) If a Contracting Party considers that any specified anti
   competitive conduct carried out within the Area of another

   Contracting Party is adversely affecting an important interest

   relevant to the purposes identified in this Article,the

   Contracting Party may notify the other Contracting Party and may

   request that its competition authorities initiate appropriate

   enforcement action. The notifying Contracting Party shall include

   in such notification sufficient information to permit the

   notified Contracting Party to identify the anti-competiti ve

   conduct that is the subject of the notification and shall include

   an offer of such further information and co-operation as that

   Contracting Party is able to provide. The notified Contracting

   Party or, as the case may be, the relevant competition authorities

   may consult with the competition authorities of the notifying

   Contracting Party and shall accord full consideration to the

   request of the notifying Contracting Party in deciding whether or

```

```
                   - 12

   not to initiate enforcement action with respect to the alleged

   anti-competiti ve conduct identified in the notification. The

   notified Contracting Party shall inform the notifying Contracting

   Party of its decision or the decision of the relevant competition

   authorities and may if it wishes inform the notifying Contracting

   Party of the grounds for the decision. If enforcement action is

   initiated, the notified Contracting Party shall advise the

   notifying Contracting Party of its outcome and, to the extent

   possible, of any significant interim development.

(6) Nothing in this Article shall require the provision of information

   by a Contracting Party contrary to its laws regarding disclosure

   of information, confidentiality or business secrecy.

(7) The procedures set forth in paragraph (5) and Article 27(1) shall

   be the exclusive means within this Treaty of resolving any

   disputes that may arise over the implementation or interpretation

   of th i s Art i cle.

                   ARTICLE 7

                   TRANSIT

(1) Each Contracting Party shall take the necessary measures to

   facilitate the Transit of Energy Materials and Products consistent

   with the principle of freedom of transit and without distinction

   as to the origin, destination or ownership of such Energy

   Materials and Products or discrimination as to the pricing on the

   basis of such distinctions, and without imposing any unreasonable

   delays, restrictions or charges.

(2) Contracting Parties shall encourage relevant entities to co
   operate in:

   (a) modernizing Energy Transport Facilities necessary to the

      Transit of Energy Materials and Products;

   (b) the development and operation of Energy Transport Facilities

      serving the Areas of more than one Contracting Party;

```

```
                    - 13

   (c) measures to mitigate the effects of interruptions in the

      supply of Energy Materials and Products;

   (d) facilitating the interconnection of Energy Transport

      FaciI i t i es.

(3) Each Contracting Party undertakes that its provisions relating to

   transport of Energy Materials and Products and the use of Energy

   Transport Facilities shall treat Energy Materials and Products in

   Transit in no less favourable a manner than its provisions treat

   such materials and products originating in or destined for its own

   Area, unless an existing international agreement provides

   otherwise.

(4) In the event that Transit of Energy Materials and Products cannot

   be achieved on commercial terms by means of Energy Transport

   Facilities the Contracting Parties shall not place obstacles in

   the way of new capacity being established, except as may be

   otherwise provided in applicable legislation which is consistent

   wi th paragraph (1).

(5) A Contracting Party through whose Area Energy Materials and

   Products may transit shall not be obliged to

   (a) permit the construction or modification of Energy Transport

      FaciI i t ies; or

   (b) permit new or additional Transit through existing Energy

      Transport Facilities,

   which it demonstrates to the other Contracting Parties concerned

   would endanger the security or efficiency of its energy systems,

   including the security of supply.

   Contracting Parties shall, subject to paragraphs (6) and (7),

   secure established flows of Energy Materials and Products to, from

   or between the Areas of other Contracting Parties.

(6) A Contracting Party through whose Area Energy Materials and

   Products Transit shall not, in the event of a dispute over any

   matter arising from that Transit, interrupt or reduce, permit any

```

```
                   - 14 
   entity subject to its control to interrupt or reduce, or require

   any entity subject to its jurisdiction to interrupt or reduce the

   existing flow of Energy Materials and Products prior to the

   conclusion of the dispute resolution procedures set out in

   paragraph (7), except where this is specifically provided for in a

   contract or other agreement governing such Transit or permitted in

   accordance with the conciliator's decision.

(7) The following provisions shall apply to a dispute described in

   paragraph (6), but only following the exhaustion of all relevant

   contractual or other dispute resolution remedies previously agreed

   between the Contracting Parties party to the dispute or between

   any entity referred to in paragraph (6) and an entity of another

   Contracting Party party to the dispute.

   (a) A Contracting Party party to the dispute may refer it to the

      Secretary-General by a notification summarizing the matters

       in dispute. The Secretary-General shall notify all

      Contracting Parties of any such referral.

   (b) Within 30 days of receipt of such a notification, the

      Secretary-General, in consultation with the parties to the

      dispute and the other Contracting Parties concerned, shall

      appoint a conciliator. Such a conciliator shall have

      experience in the matters subject to dispute and shall not be

      a national or citizen of or permanently resident in a party

       to the dispute or one of the other Contracting Parties

      concerned.

   (c) The conciliator shall seek the agreement of the parties to

       the dispute to a resolution thereof or upon a procedure to

       achieve such resolution. If within 90 days of his appointment

       he has failed to secure such agreement, he shall recommend a

       resolution to the dispute or a procedure to achieve such

       resolution and shall decide the interim tariffs and other

       terms and conditions to be observed for Transit from a date

      which he sha I I specify until the dispute is resolved.

```

```
                   - 15 
   (d) The Contracting Parties undertake to observe and ensure that

      the entities under their control or jurisdiction observe any

      interim decision under paragraph (7)(c) on tariffs, terms and

      conditions for 12 months following the conciliator's

      decision or until resolution of the dispute, whichever is

      ear Iier.

   (e) Notwithstanding sub-paragraph (b) the Secretary-General may

      elect not to appoint a conciliator if in his judgement the

      dispute concerns Transit that is or has been the subject of

      the dispute resolution procedures set out in sub-paragraphs

      (a) to (d) and those proceedings have not resulted in a

      resolution of the dispute.

   (f) The Charter Conference shall adopt standard provisions

      concerning the conduct of conciliation and the compensation

      of conci I iators.

(8) Nothing in this Article shall derogate from a Contracting Party's

   rights and obligations under international law including customary

   international law, existing bilateral or multilateral agreements,

   including rules concerning submarine cables and pipelines.

(9) This Article shall not be so interpreted as to oblige any

   Contracting Party which does not have a certain type of Energy

   Transport Facilities used for Transit to take any measure under

   this Article with respect to that type of Energy Transport

   Facilities. Such a Contracting Party shall, however, be obliged to

   comply with paragraph (4).

(10) For the purposes of this Article:

   (a) "Transit" means:

      (i) the carriage through the Area of a Contracting Party, or

         to or from port facilities in its Area for loading or

        unloading, of Energy Materials and Products originating

```

```
                   - 16 
        in the Area of another state and destined for the Area of

        a third state, so long as either the other state or the

        third state is a Contracting Party; or

      (ii) the carriage through the Area of a Contracting Party of

         Energy Materials and Products originating in the Area of

         another Contracting Party and destined for the Area of

         that other Contracting Party, unless the two Contracting

         Parties concerned decide otherwise and record their

         decision by a joint entry in Annex N. The * two

         Contracting Parties may delete their listing in Annex N

         by delivering a joint written notification of their

         intentions to the Secretariat, which shall transmit

         that notification to all other Contracting Parties. The

         deletion shall take effect four weeks after such former

         not i f i cat ion.

   (b) "Energy Transport Facilities" consist of high-pressure gas

      transmission pipelines, high-voltage electricity transmission

      grids and lines, crude oil transmission pipelines, coal

      slurry pipelines, oil product pipelines, and other fixed

      facilities specifically for handling Energy Materials and

      Products.

                  ARTICLE 8

               TRANSFER OF TECHNOLOGY

(1) The Contracting Parties agree to promote access to and transfer

   of energy technology on a commercial and non-discriminatory basis

   to assist effective trade in Energy Materials and Products and

   Investment and to implement the objectives of the Charter subject

   to their laws and regulations, and to the protection of

   Intellectual Property rights.

```

```
                   - 17 
(2) Accordingly, to the extent necessary to give effect to paragraph

   (1) the Contracting Parties shall eliminate existing and create no

   new obstacles for transfer of technology, in the field of Energy

   Materials and Products and related equipment and services, subject

   to non-proliferation and other international obligations.

                  ARTICLE 9

                ACCESS TO CAPITAL

(1) The Contracting Parties acknowledge the importance of open capital

   markets in encouraging the flow of capital to finance trade in

   Energy Materials and Products and for the making of and assisting

   with regard to Investments in Economic Activity in the Energy

   Sector in the Areas of other Contracting Parties, particularly

   those with economies in transition. Each Contracting Party shall

   accordingly endeavour to promote conditions for access to its

   capital market by companies and nationals of other Contracting

   Parties, for the purpose of financing trade in Energy Materials

   and Products and for the purpose of Investment in Economic

   Activity in the Energy Sector in the Areas of those other

   Contracting Parties, on a basis no less favourable than that

   which it accords in like circumstances to its own companies and

   nationals or companies and nationals of any other Contracting

   Party or any third state, whichever is the most favourable.

(2) A Contracting Party may adopt and maintain programmes providing

   for access to public loans, grants, guarantees or insurance for

   facilitating trade or Investment abroad. It shaÍI make such

   facilities available, consistent with the objectives, constraints

   and criteria of such programmes (including but not limited to, on

   any grounds, objectives, constraints or criteria relating to the

   place of business of an applicant for any such facility or the

   place of delivery of goods or services supplied with the support

   of any such facility) for Investments in the Economic Activity in

   the Energy Sector of other Contracting Parties or for financing

   trade in Energy Materials and Products with other Contracting

   Part ies.

```

```
                - 18 
(3) Contracting Parties shall, in implementing programmes in Economic

   Activity in the Energy Sector to improve the economic stability

   and investment climates of the Contracting Parties, seek as

   appropriate to encourage the operations and take advantage of the

   expertise of relevant international financial institutions.

(4) Nothing in this Article shall prevent

   (a) financial institutions from applying their own lending or

      underwriting practices based on market principles and

      prudential considerations; or

   (b) a Contracting Party from taking measures

      (i) for prudential reasons, including the protection of

         Investors, consumers, depositors, policy holders or

         persons to whom a fiduciary duty is owed by a financial

         serv ice suppI ier; or

      (ii) to ensure the integrity and stability of its financial

         system and capital markets.

```

```
                 19

                   PART I I I

           INVESTMENT PROMOTION AND PROTECTION

                  ARTICLE 10

      PROMOTION, PROTECTION AND TREATMENT OF INVESTMENTS

(1) Each Contracting Party shall, in accordance with the provisions of

   this Treaty, encourage and create stable, equitable, favourable

   and transparent conditions for Investors of other Contracting

   Parties to Make Investments in its Area. Such conditions shall

   include a commitment to accord at all times to Investments of

   Investors of other Contracting Parties fair and equitable

   treatment. Such Investments shall also enjoy the most constant

   protection and security and no Contracting Party shall in any way

   impair by unreasonable or discriminatory measures their

   management, maintenance, use, enjoyment or disposal. In no case

   shall such Investments be accorded treatment less favourable than

   that required by international law, including treaty obligations.

   Each Contracting Party shall observe any obligations it has

 , entered into with an Investor or an Investment of an Investor of

   any other Contracting Party.

(2) Each Contracting Party shall endeavour to accord to Investors of

   other Contracting Parties, as regards the Making of Investments in

   its Area, the Treatment described in paragraph (3).

(3) For the purposes of this Article, "Treatment" means treatment

   accorded by a Contracting Party which is no less favourable than

   that which it accords to its own Investors or to Investors of any

   other Contracting Party or any third state, whichever is the most

   favourable.

(4) A supplementary treaty shall, subject to conditions to be laid

   down therein, oblige each party thereto to accord to Investors of

   other parties, as regards the Making of Investments in its Area,

```

```
                   - 20 
   the Treatment described in paragraph (3). That treaty shall be

   open for signature by the states and Regional Economic

   Integration Organizations which have signed or acceded to this

   Treaty. Negotiations towards the supplementary treaty shall

   commence not later than 1 January 1995, with a view to concluding

   it by 1 January 1998.

(5) Each Contracting Party shall, as regards the Making of Investments

   in its Area, endeavour to:

   (a) limit to the minimum the exceptions to the Treatment

      described in paragraph (3);

   (b) progressively remove existing restrictions affecting

      Investors of other Contracting Parties.

(6) (a) A Contracting Party may, as regards the Making of Investments

      in its Area, at any time declare voluntarily to the

      Charter Conference, through the Secretariat, its intention

      not to introduce new exceptions to the Treatment described in

      paragraph (3).

   (b) A Contracting Party may, furthermore, at any time make a

      voluntary commitment to accord to Investors of other

      Contracting Parties, as regards the Making of Investments in

      some or all Economic Activities in the Energy Sector in its

      Area, the Treatment described in paragraph (3). Such

      commitments shall be notified to the Secretariat and listed

      in Annex VC and shall be binding under this Treaty.

(7) Each Contracting Party shall accord to Investments in its Area of

   Investors of another Contracting Party, and their related

   activities including management, maintenance, use, enjoyment or

   disposal, treatment no less favourable than that which it accords

   to Investments of its own Investors or of the Investors of any

   other Contracting Party or any third state and their related

   activities including management, maintenance, use, enjoyment or

   disposal, whichever is the most favourable.

```

```
                   - 21 
(8) The modalities of application of paragraph (7) in relation to

   programmes under which a Contracting Party provides grants or

   other financial assistance, or enters into contracts, for energy

   technology research and development, shall be reserved for the

   supplementary treaty described in paragraph (4). Each Contracting

   Party shall through the Secretariat keep the Charter Conference

   informed of the modalities it applies to the programmes described

   in this paragraph.

(9) Each state or Regional Economic Integration Organization which

   signs or accedes to this Treaty shall, on the date it signs the

   Treaty or deposits its instrument of accession, submit to the

   Secretariat a report summarizing all laws, regulations or other

   measures relevant to:

   (a) exceptions to paragraph (2); or

   (b) the programmes referred to in paragraph (8).

   A Contracting Party shall keep its report up to date by promptly

   submitting amendments to the Secretariat. The Charter Conference

   shall review these reports periodically.

   In respect of sub-paragraph (a) the report may designate parts of

   the energy sector in which a Contracting Party accords to

   Investors of other Contracting Parties the Treatment described in

   paragraph (3).

   In respect of sub-paragraph (b) the review by the Charter

   Conference may consider the effects of such programmes on

   competition and Investments.

(10) Notwithstanding any other provision of this Article, the Treatment

   described in paragraph (3) shall not apply to the protection of

   Intellectual Property; instead, the treatment shall be as

   specified in the corresponding provisions of the applicable

   international agreements for the protection of Intellectual

   Property rights to which the respective Contracting Parties are

   part ies.

```

```
                   - 22 
(11) For the purposes of Article 26, the application by a Contracting

   Party of a trade related investment measure as described in

   Article 5(1) and (2) to an Investment of an Investor of another

   Contracting Party existing at the time of such application shall,

   subject to Article 5(3) and (4), be considered a breach of an

   obligation of the former Contracting Party under this Part.

(12) Each Contracting Party shall ensure that its domestic law provides

   effective means for the assertion of claims and the enforcement of

   rights with respect to Investment, investment agreements, and

   investment authorizations.

                  ARTICLE 11

                 KEY PERSONNEL

(1) A Contracting Party shall, subject to its laws and regulations

   relating to the entry, stay and work of natural persons, examine

   in good faith requests by Investors of another Contracting Party,

   and key personnel who are employed by such Investors or by

   Investments of such Investors, to enter and remain temporarily in

   its Area to engage in activities connected with the making or the

   development, management, maintenance, use, enjoyment or disposal

   of relevant Investments, including the provision of advice or key

   technical services.

(2) A Contracting Party shall permit Investors of another Contracting

   Party which have Investments in its Area, and Investments of such

   Investors, to employ any key person of the Investor's or the

   Investment's choice regardless of nationality and citizenship

   provided that such key person has been permitted to enter, stay

   and work in the Area of the former Contracting Party and that the

   employment concerned conforms to the terms, conditions and time

   limits of the permission granted to such key person.

```

```
                    - 23 
                   ARTICLE 12

               COMPENSATION FOR LOSSES

(1) Except where Article 13 applies, an Investor of any Contracting

   Party which suffers a loss with respect to any Investment in the

   Area of another Contracting Party owing to war or other armed

   conflict, state of national emergency, civil disturbance, or other

   similar event in that Area, shall be accorded by the latter

   Contracting Party, treatment, as regards restitution,

   indemnification, compensation or other settlement, which is the

   most favourable of that which that Contracting Party accords to

   any other Investor, whether its own Investor, the Investor of any

   other Contracting Party, or the Investor of any third state.

(2) Without prejudice to paragraph (1), an Investor of a Contracting

   Party which, in any of the situations referred to in that

   paragraph, suffers a loss in the Area of another Contracting Party

   resulting from

   (a) requisitioning of its Investment or part thereof by the

      latter's forces or authorities; or

   (b) destruction of its Investment or part thereof by the latter's

      forces or authorities, which was not required by the

      necessity of the situation,

   shall be accorded restitution or compensation which in either case

   shall be prompt, adequate and effective.

                   ARTICLE 13

                  EXPROPRIATION

(1) Investments of Investors of a Contracting Party in the Area of any

   other Contracting Party shall not be nationalized, expropriated or

   subjected to a measure or measures having effect equivalent to

   nationalization or expropriation (hereinafter referred to as

   "Expropriation") except where such Expropriation is:

```

```
                   - 24 
   (a) for a purpose which is in the public interest;

   (b) not discriminatory;

   (c) carried out under due process of law; and

   (d) accompanied by the payment of prompt, adequate and effective

      compensation.

   Such compensation shall amount to the fair market value of the

   Investment expropriated at the time immediately before the

   Expropriation or impending Expropriation became known in such a

   way as to affect the value of the Investment (hereinafter referred

   to as the "Valuation Date").

   Such fair market value shall at the request of the Investor be

   expressed in a Freely Convertible Currency on the basis of the

   market rate of exchange existing for that currency on the

   Valuation Date. Compensation shall also include interest at a

   commercial rate established on a market basis from the date of

   Expropriation until the date of payment.

(2) The Investor affected shall have a right to prompt review, under

   the law of the Contracting Party making the Expropriation, by a

   judicial or other competent and independent authority of that

   Contracting Party, of its case, of the valuation of its

   Investment, and of the payment of compensation, in accordance with

   the principles set out in paragraph (1).

(3) For the avoidance of doubt, Expropriation shall include situations

   where a Contracting Party expropriates the assets of a company or

   enterprise in its Area in which an Investor of any other

   Contracting Party has an Investment, including through the

   ownership of shares.

```

```
                 25

                  ARTICLE 14

            TRANSFERS RELATED TO INVESTMENTS

(1) Each Contracting Party shall with respect to Investments in its

   Area of Investors of any other Contracting Party guarantee the

   freedom of transfer into and out of its Area, including the

   transfer of:

   (a) the initial capital plus any additional capital for the

      maintenance and development of an Investment;

   (b) Returns;

   (c) payments under a contract, including amortization of

      principal and accrued interest payments pursuant to a loan

      agreement ;

   (d) unspent earnings and other remuneration of personnel engaged

      from abroad in connection with that Investment;

   (e) proceeds from the sale or liquidation of all or any part of

      an Investment;

   (f) payments arising out of the settlement of a dispute;

   (g) payments of compensation pursuant to Articles 12 and 13.

(2) Transfers under paragraph (1) shall be effected without delay and

   in a Freely Convertible Currency.

(3) Transfers shall be made at the market rate of exchange existing on

   the date of transfer with respect to spot transactions in the

   currency to be transferred, in the absence of a market for foreign

   exchange, the rate to be used will be the most recent rate applied

   to inward investments or the most recent exchange rate for

   conversion of currencies into Special Drawing Rights, whichever is

   more favourable to the Investor.

(4) Notwithstanding paragraphs (1) to (3), a Contracting Party may

   protect the rights of creditors, or ensure compliance with laws on

   the issuing, trading and dealing in securities and the

   satisfaction of judgments in civil, administrative and criminal

```

```
                    - 26 
   adjudicatory proceedings, through the equitable, non
   discriminatory, and good faith application of its laws and

   régulât ions.

(5) Notwithstanding paragraph (2), Contracting Parties which are

   states that were cons i tuent parts of the former Union of Soviet

   Socialist Republics may provide in agreements concluded between

   them that transfers of payments shall be made in the currencies of

   such Contracting Parties, provided that such agreements do not

   treat Investments in their Areas of Investors of other Contracting

   Parties less favourably than either Investments of Investors of

   the Contracting Parties which have entered into such agreements or

   Investments of Investors of any third state.

(6) Notwithstanding paragraph (1Mb), a Contracting Party may restrict

   the transfer of a Return in kind in circumstances where the

   Contracting Party is permitted under the GATT and Related

   Instruments or Article 29(2)(a) of this Treaty to restrict or

   prohibit the exportation or the sale for export of the product

   constituting the Return in kind; provided that a Contracting Party

   shall permit Returns in kind to be made as authorized or specified

   in an investment agreement, investment authorization, or other

   written agreement between the Contracting Party and either an

   Investor of another Contracting Party or its Investment.

                  ARTICLE 15

                  SUBROGATION

(1) If a Contracting Party or its designated agency (hereinafter

   referred to as the "Indemnifying Party") makes a payment under an

   indemnity or guarantee given in respect of an Investment of an

   Investor (hereinafter referred to as the "Party Indemnified") in

   the Area of another Contracting Party (hereinafter referred to as

   the "Host Party"), the Host Party shall recognize:

```

```
                   - 27 
   (a) the assignment to the Indemnifying Party of all the rights

      and claims in respect of such Investment; and

   (b) the right of the Indemnifying Party to exercise all such

      rights and enforce such claims by virtue of subrogation.

(2) The Indemnifying Party shall be entitled in all circumstances to

   (a) the same treatment in respect of the rights and claims

      acquired by it by virtue of the assignment referred to in

      paragraph (1); and

   (b) the same payments due pursuant to those rights and claims,

   as the Party Indemnified was entitled to receive by virtue of this

   Treaty in respect of the Investment concerned.

(3) In any proceeding under Article 26, a Contracting Party shall not

   assert as a defence, counterclaim, right of set-off or for any

   other reason, that indemnification or other compensation for all

   or part of the alleged damages has been received or will be

   received pursuant to an insurance or guarantee contract.

                  ARTICLE 16

             RELATION TO OTHER AGREEMENTS

Where two or more Contracting Parties have entered into a prior

international agreement, or enter into a subsequent international

agreement, whose terms in either case concern the subject matter of

Part III or V of this Treaty,

(1) nothing in Part III or V of this Treaty shall be construed to

   derogate from any provision of such terms of the other agreement

   or from any right to dispute resolution with respect thereto under

   that agreement; and

```

```
                    - 28 
(2) nothing in such terms of the other agreement shall be construed to

   derogate from any provision of Part III or V of this Treaty or

   from any right to dispute resolution with respect thereto under

   this Treaty,

where any such provision is more favourable to the Investor or

Investment.

                  ARTICLE 17

      NON-APPLICATION OF PART III IN CERTAIN CIRCUMSTANCES

Each Contracting Party reserves the right to deny the advantages of

this Part to:

(1) a legal entity if citizens or nationals of a third state own or

   control such entity and if that entity has no substantial business

   activities in the Area of the Contracting Party in which it is

   organized; or

(2) an Investment, if the denying Contracting Party establishes that

   such Investment is an Investment of an Investor of a third state

   with or as to which the denying Contracting Party

   (a) does not maintain a diplomatic relationship; or

   (b) adopts or maintains measures that

      (i) prohibit transactions with Investors of that state; or

      (ii) would be violated or circumvented if the benefits of

         this Part were accorded to Investors of that state or

         to their Investments.

```

```
                   - 29

                   PART IV

                  CONTEXTUAL

                  ARTICLE 18

           SOVEREIGNTY OVER ENERGY RESOURCES

(1) The Contracting Parties recognize state sovereignty and sovereign

   rights over energy resources. They reaffirm that these must be

   exercised in accordance with and subject to the rules of

   international law.

(2) Without affecting the objectives of promoting access to energy

   resources, and exploration and development thereof on a commercial

   basis, the Treaty shall in no way prejudice the rules in

   Contracting Parties governing the system of property ownership of

   energy resources.

(3) Each state continues to hold in particular the rights to decide

   the geographical areas within its Area to be made available for

   exploration and development of its energy resources and the rate

   at which they may be depleted or otherwise exploited, to specify

   and enjoy any taxes, royalties or other financial payments payable

   by virtue of such exploration and exploitation and to regulate

   the resource conservation and the environmental and safety aspects

   of such exploration, development and reclamation within its Area,

   and to participate in such exploration and exploitation, inter

   alia, through direct participation by the government or through

   state enterpr i ses.

(4) The Contracting Parties undertake to facilitate access to energy

   resources inter alia by allocating in a non-discriminatory manner

   on the basis of published criteria authorizations, licences,

   concessions and contracts to prospect and explore for or to

   exploit or extract energy resources.

```

```
                   - 30 
                  ARTICLE 19

               ENVIRONMENTAL ASPECTS

(1) In pursuit of sustainable development and taking into account its

   obligations under those international agreements concerning the

   environment to which it is party, each Contracting Party shall

   strive to minimize in an economically efficient manner harmful

   Environmental Impacts occurring either within or outside its

   Area from all operations within the Energy Cycle in its Area,

   taking proper account of safety. In doing so each Contracting

   Party shall act in a Cost-Effect i ve manner. In its policies and

   actions each Contracting Party shall strive to take precautionary

   measures to prevent or minimize environmental degradation. The

   Contracting Parties agree that the polluter in the Areas of

   Contracting Parties, should, in principle, bear the cost of

   pollution, including transboundary pollution, with due regard to

   the public interest and without distorting Investment in the

   Energy Cycle or international trade. Contracting Parties shall

   accordingly:

   (a) take account of environmental considerations throughout the

      formulation and implementation of their energy policies;

   (b) promote market-oriented price formation and a fuller

      reflection of environmental costs and benefits throughout the

      Energy Cycle;

   (c) having regard to Article 34(4), encourage co-operation in the

      attainment of the environmental objectives of the Charter and

      co-operation in the field of international environmental

      standards for the Energy Cycle, taking into account

      differences in adverse effects and abatement costs between

      Contracting Parties;

   (d) have particular regard to Improving Energy Efficiency, to

      developing and using renewable energy sources, to promoting

      the use of cleaner fuels and to employing technologies and

      technological means that reduce pollution;

```

```
                - 31 
(e) promote the collection and sharing among Contracting Parties

   of information on environmentally sound and economically

   efficient energy policies and Cost-Effect i ve practices and

   techno log ies;

(f) promote public awareness of the Environmental Impacts of

   energy systems, of the scope for the prevention or abatement

   of their adverse Environmental Impacts, and of the costs

   associated with various prevention or abatement measures;

(g) promote and cooperate in the research, development and

   application of energy efficient and environmentally sound

   technologies, practices and processes which will minimize

   harmful Environmental Impacts of all aspects of the Energy

   Cycle in an economically efficient manner;

(h) encourage favourable conditions for the transfer and

   dissemination of such technologies consistent with the

   adequate and effective protection of Intellectual Property

   r ights;

(i) promote the transparent assessment at an early state and

   prior to decision, and subsequent monitoring, of

   Environmental Impacts of environmentally significant energy

   investment projects;

(j) promote international awareness and information exchange on

   Contracting Parties' relevant environmental programmes and

   standards and on the implementation of those programmes and

   standards;

(k) participate, upon request, and within their available

   resources, in the development and implementation of

   appropriate environmental programmes in the Contracting

   Part ies.

```

```
                     - 32 
(2) At the request of one or more Contracting Parties, disputes

   concerning the application or interpretation of provisions of this

   Article shair, to the extent that arrangements for the

   consideration of such disputes do not exist in other appropriate

   international fora, be reviewed by the Charter Conference aiming

   at a so lut ion.

(3) For the purposes of this Article:

   (a) "Energy Cycle" means the entire energy chain, including

      activities related to prospecting for, exploration,

      production, conversion, storage, transport, distribution and

      consumption of the various forms of energy, and the treatment

      and disposal of wastes, as well as the decommissioning,

      cessation or closure of these activities, minimizing harmful

      Environmental Impacts.

   (b) "Environmental Impact" means any effect caused by a given

      activity on the environment, including human health and

      safety, flora, fauna, soil, air, water, climate, landscape

      and historical monuments or other physical structures or the

       interactions among these factors; it also includes effects on

      cultural heritage or socio-economic conditions resulting from

      alterations to those factors.

   (c) "Improving Energy Efficiency" means acting to maintain the

      same unit of output (of a good or service) without reducing

      the quality or performance of the output, while reducing the

      amount of energy required to produce that output.

   (d) "Cost-Effective" means to achieve a defined objective at the

       lowest cost or to achieve the greatest benefit at a given

      cost.

```

```
                    - 33

                   ARTICLE 20

                   TRANSPARENCY

(1) Laws, regulations, judicial decisions and administrative rulings

   of general application which affect trade in Energy Materials and

   Products are, in accordance with Article 29(2)(a), among the

   measures subject to the transparency disciplines of the GATT and

   relevant Related Instruments.

(2) Laws, regulations, judicial decisions and administrative rulings

   of general application made effective by any Contracting Party,

   and agreements in force between Contracting Parties, which affect

   other matters covered by this Treaty shall also be published

   promptly in such a manner as to enable Contracting Parties and

   Investors to become acquainted with them. The provisions of this

   paragraph shall not require any Contracting Party to disclose

   confidential information which would impede law enforcement or

   otherwise be contrary to the public interest or would prejudice

   the legitimate commercial interests of any Investor.

(3) Each Contracting Party shall designate one or more enquiry points

   to which requests for information about the above mentioned laws,

   regulations, judicial decisions and administrative rulings may be

   addressed and shall communicate promptly such designation to the

   Secretariat which shall make it available on request.

                   ARTICLE 21

                    TAXATION

(1) Except as otherwise provided in this Article, nothing in this

   Treaty shall apply to impose obligations with respect to Taxation

   Measures of the Contracting Parties. In the event of any

    inconsistency between this Article and any other provision of this

   Treaty, this Article shall prevail to the extent of the

    inconsistency.

```

```
                     - 34 
(2) Notwithstanding paragraph (1),

   (a) Article 29 shall apply to Taxation Measures other than those

      on income or on capital; and

   (b) the provisions of this Treaty requiring a Contracting Party

      to provide most favoured nation treatment relating to trade

      in goods and services shall apply to Taxation Measures other

      than taxes on income or on capital, except that such

      provisions shall not apply to:

      (i) an advantage accorded by a Contracting Party pursuant to

         the tax provisions in any convention, agreement or

         arrangement, described in paragraph (6)(a)(ii); or

      (ii) any Taxation Measure aimed at ensuring the effective

         collection of taxes, except where the measure

         arbitrarily discriminates between goods of the

         Contracting Parties or arbitrarily restricts benefits

         accorded under the above mentioned provisions of this

         Treaty.

(3) The provisions imposing national treatment obligations or most

   favoured nation obligations under Part Ml shall apply to Taxation

   Measures of the Contracting Parties other than those on income

   or on capital, except that such provisions shall not apply to:

   (a) impose most favoured nation obligations with respect to

      advantages accorded by a Contracting Party pursuant to the

      tax provisions in any convention, agreement or arrangement,

      described in paragraph (6)(a)(ii) or resulting from

      membership of any Regional Economic Integration Organization;

      or

   (b) any Taxation Measure concerning the effective collection of

      taxes, except where the measure arbitrarily discriminates

      between Investors of the Contracting Parties or arbitrarily

      restricts benefits accorded under the Investment provisions

      of this Treaty.

```

```
                      35 
(4) (a) Article 13 shall apply to taxes.

   (b) Whenever an issue arises under Article 13, to the extent it

      pertains to whether a tax constitutes an expropriation or

      whether a tax alleged to constitute an expropriation is

      discriminatory, the following provisions shall apply:

      (i) The Investor or the Contracting Party alleging

          expropriation shall refer the issue of whether the tax

          is an expropriation or whether the tax is

          discriminatory to the relevant Competent Tax Authority.

          Failing such referral by the Investor or the

          Contracting Party, bodies called upon to settle

          disputes pursuant to Article 26(2)(c) or 27(2) shall

          make a referral to the relevant Competent Tax

          Author i t ies.

      (ii) The Competent Tax Authorities shall, within a period of

          six months of such referral, strive to resolve the

          issues so referred. Where non-discrimination issues are

          concerned, the Competent Tax Authorities shall apply

          the non-discrimination provisions of the relevant tax

          convention or, if there is no non-discrimination

          provision in the relevant tax convention applicable to

          the tax or no such tax convention is in force between

          the Contracting Parties concerned, they shall apply the

          non-discrimination principles under the Model Tax

          Convention on Income and Capital of the Organisation

          for Economic Co-operation and Development.

      (iii) Bodies called upon to settle disputes pursuant to

          Article 26(2)(c) or 27(2) may take into account any

          conclusions arrived at by the Competent Tax

          Authorities regarding whether the tax is an

          expropriation. Such bodies shall take into account any

          conclusions arrived at within the six-month period

          prescribed in sub-paragraph ( i i ) by the Competent Tax

          Authorities regarding whether the tax is

```

```
                   - 36 
          discriminatory. Such bodies may also take into account

          any conclusions arrived at by the Competent Tax

          Authorities after the expiry of the six-month period.

      (iv) Under no circumstances shall involvement of the

          Competent Tax Authorities, beyond the end of the six
          month period referred to in sub-paragraph (ii), lead to

          a delay of proceedings under Articles 26 and 27.

(5) For the avoidance of doubt, Article 14 shall not limit the right

   of a Contracting Party to impose or collect a tax by withholding

   or other means.

(6) For the purposes of this Article:

   (a) The term "Taxât ion-Measure" includes:

      (i) any provision relating to taxes of the domestic law of

         the Contracting Party or of a political subdivision

         thereof or a local authority therein; and

      (ii) any provision relating to taxes of any convention for

         the avoidance of double taxation or any other

         international agreement or arrangement by which the

         Contracting Party is bound.

   (b) There shall be regarded as taxes on income or on capital all

      taxes imposed on total income, on total capital or on

      elements of income or of capital, including taxes on gains

      from the alienation of property, taxes on estates,

      inheritances and gifts, or substantially similar taxes, taxes

      on the total amounts of wages or salaries paid by

      enterprises, as well as taxes on capital appreciation.

   (c) A "Competent Tax Authority" means the competent authority

      pursuant to a double taxation agreement in force between the

      Contracting Paries or, when there is no such agreement

```

```
                   - 37 
      between the countries in question, the m'inister or ministry

      responsible for taxes or his or its authorized

      représentât i ves.

   (d) For the avoidance of doubt, the terms "tax provisions" and

      "taxes" do not include customs duties.

                  ARTICLE 22

            STATE AND PRIVILEGED ENTERPRISES

(1) Each Contracting Party shall ensure that any state enterprise

   which it maintains or establishes shall conduct its activities in

   relation to the sale or provision of goods and services in its

   Area in a manner consistent with the Contracting Party's

   obligations under Part I I I of this Treaty.

(2) No Contracting Party shall encourage or require such a state

   enterprise to conduct its activities in its Area in a manner

   inconsistent with the Contracting Party's obligations under other

   provisions of this Treaty.

(3) Each Contracting Party shall ensure that if it establishes or

   maintains a state entity and entrusts the entity with regulatory,

   administrative or other governmental authority, such entity shall

   exercise that authority in a manner consistent with the

   Contracting Party's obligations under this Treaty.

(4) No Contracting Party shall encourage or require any entity to

   which it grants exclusive or special privileges to conduct its

   activities in its Area in a manner inconsistent with the

   Contracting Party's obligations under this Treaty.

(5) For the purposes of this Article, "entity" includes any

   enterprise, agency or other organization or individual.

```

```
                   - 38 
                  ARTICLE 23

          OBSERVANCE BY SUB-NATIONAL AUTHORITIES

(1) Each Contracting Party is fully responsible under this Treaty for

   the observance of all provisions of this Treaty, and shall take

   such reasonable measures as may be available to it to ensure such

   observance by regional and local governments and authorities

   wi thin its Area.

(2) The dispute settlement provisions in Parts II, IV and V of this

   Treaty may be invoked in respect of measures affecting the

   observance of this Treaty by a Contracting Party which have been

   taken by regional or local governments or authorities within the

   Area of the Contracting Party.

                  ARTICLE 24

                  EXCEPTIONS

(1) This Article shall not apply to Articles 12, 13 and 29.

(2) The provisions of this Treaty other than

   (a) those referred to in paragraph (1); and

   (b) with respect to sub-paragraph (i), Part I I I of this Treaty

   shall not preclude any Contracting Party from adopting or

   enforcing any measure

   (i) necessary to protect human, animal or plant life or health;

   (ii) essential to the acquisition or distribution of Energy

       Materials and Products in conditions of short supply

       arising from causes outside the control of that Contracting

       Party, provided that any such measure shall be consistent

       with the principles that

```

```
                   - 39 
       (A) all other Contracting Parties are entitled to an

         equitable share of the international supply of such

         Energy Materials and Products-, and

       (B) any such measure that is inconsistent with this Treaty

         shall be discontinued as soon as the conditions giving

         rise to it have ceased to exist; or

   (iii) designed to benefit Investors who are aboriginal people or

       socially or economically disadvantaged individuals or

       groups or their Investments and notified to the Secretariat

       as such, provided that such measure

       (A) has no significant impact on that Contracting Party's

         economy ; and

       (B) does not discriminate between Investors of any other

         Contracting Party and Investors of that Contracting

         Party not included among those for whom the measure is

          intended,

   provided that no such measure shall constitute a disguised

   restriction on Economic Activity in the Energy Sector, or

   arbitrary or unjustifiable discrimination between Contracting

   Parties or between Investors or other interested persons of

   Contracting Parties. Such measures shall be duly motivated and

   shall not nullify or impair any benefit one or more other

   Contracting Parties may reasonably expect under this Treaty to an

   extent greater than is strictly necessary to the stated end.

(3) The provisions of this Treaty other than those referred to in

   paragraph (1) shall not be construed to prevent any Contracting

   Party from taking any measure which it considers necessary:

   (a) for the protection of its essential security interests

      including those

      (i) relating to the supply of Energy Materials and Products

         to a military establishment; or

      (ii) taken in time of war, armed confIict or other emergency

         in international relations;

```

```
                   - 40 
   (b) relating to the implementation of national policies

      respecting the non-proliferation of nuclear weapons or other

      nuclear explosive devices or needed to fulfil its obligations

      under the Treaty on the Non-Proliferation of Nuclear

      Weapons, the Nuclear Suppliers Guidelines, and other

      international nuclear non-proliferation obligations or

      understandings; or

   (c) for the maintenance of public order.

   Such measure shall not constitute a disguised restriction on

   Transit.

(4) The provisions of this Treaty which accord most favoured nation

   treatment shall not oblige any Contracting Party to extend to the

   Investors of any other Contracting Party any preferential

   treatment:

   (a) resulting from its membership in a free-trade area or customs

      union; or

   (b) which is accorded by bilateral or multilateral agreements

      concerning economic co-operation between the states that were

      constituent parts of the former Union of Soviet Socialist

      Republics pending the establishment of their mutual economic

      relations on a definitive basis.

                  ARTICLE 25

            ECONOMIC INTEGRATION AGREEMENTS

(1) The provisions of this Treaty shall not be so construed as to

   oblige a Contracting Party which is party to an Economic

   Integration Agreement (hereinafter referred to as "EIA") to

   extend, by means of most favoured nation treatment, to another

   Contracting Party which is not a party to that EIA, any

   preferential treatment applicable between the parties to that EIA

   as a result of their being parties thereto.

```

```
                   - 41

(2) For the purposes of paragraph (1) "EIA" means an agreement

   substantially liberalizing inter alia trade and investment, by

   providing for the absence or elimination of substantially all

   discrimination between or among parties thereto through the

   elimination of existing discriminatory measures and/or the

   prohibition of new or more discriminatory measures, either at the

   entry into force of that agreement or on the basis of a reasonable

   time frame.

(3) This Article shall not affect the application of the GATT

   according to Article 29.

```

```
                     42 
                   PART V

                DISPUTE SETTLEMENT

                  ARTICLE 26

 SETTLEMENT OF DISPUTES BETWEEN AN INVESTOR AND A CONTRACTING PARTY

(1) Disputes between a Contracting Party and an Investor of another

   Contracting Party relating to an Investment of the latter in the

   Area of the former, which concern an alleged breach of an

   obligation of the former under Part III shall, if possible, be

   sett led amicably.

(2) If such disputes can not be settled according to the provisions of

   paragraph (1) within a period of three months from the date on

   which either party to the dispute requested amicable settlement,

   the Investor party to the dispute may choose to submit it for

   résolut ion:

   (a) to the courts or administrative tribunals of the Contracting

      Party party to the dispute;

   (b) in accordance with any applicable, previously agreed dispute

      settlement procedure; or

   (c) in accordance with the following paragraphs of this Article.

(3) (a) Subject only to sub-paragraphs (b) and (c), each Contracting

      Party hereby gives its unconditional consent to the

      submission of a dispute to international arbitration or

      conciliation in accordance with the provisions of this

      Art icle.

   (b) (i) The Contracting Parties listed in Annex ID do not give

        such unconditional consent where the Investor has

        previously submitted the dispute under paragraph (2)(a)

        or (b).

```

```
                   - 43

     (i i) For the sake of transparency, each Contracting Party that

        is listed in Annex ID shall provide a written statement

        of its policies, practices and conditions in this regard

        to the Secretariat nó later than the date of the deposit

        of its instrument of ratification, acceptance or approval

        in accordance with Article 39 or the deposit of its

        instrument of accession in accordance with Article 41.

   (c) A Contracting Party listed in Annex IA does not give such

      unconditional consent with respect to a dispute arising under

      the last sentence of Article 10(1).

(4) In the event that an Investor chooses to submit the dispute for

   resolution under paragraph (2)(c), the Investor shall further

   provide its consent in writing for the dispute to be submitted to:

   (a) (i) The International Centre for Settlement of Investment

        Disputes, established pursuant to the Convention on the

        Settlement of Investment Disputes between States and

        Nationals of other States opened for signature at

        Washington 18 March 1965 (hereinafter referred to as the

        "ICSID Convention") if the Contracting Party of the

         Investor and the Contracting Party party to the dispute

        are both parties to the ICSID Convention; or

     (ii) The International Centre for Settlement of Investment

        Disputes, established pursuant to the Convention referred

        to in sub-paragraph (a)(i), under the rules governing the

        Additional Facility for the Administration of Proceedings

        by the Secretariat of the Centre (hereinafter referred

        to as the "Additional Facility Rules"), if the

        Contracting Party of the Investor or the Contracting

        Party party to the dispute, but not both, is a party to

        the ICSID Convention;

                     OR

   (b) a sole arbitrator or ad hoc arbitration tribunal established

      under the Arbitration Rules of the United Nations Commission

      on International Trade Law (hereinafter referred to as

      "UNCITRAL");

```

```
                   - 44 
                     OR

   (c) an arbitral proceeding under the Arbitration Institute of the

      Stockholm Chamber of Commerce.

(5) (a) The consent given in paragraph (3) together with the written

      consent of the Investor given pursuant to paragraph (4) shall

      satisfy the requirement for:

      (i) written consent of the parties to a dispute for

          purposes of Chapter II of the ICSID Convention and for

          purposes of the Additional Facility Rules;

      (ii) an "agreement in writing" for purposes of article II of

          the United Nations Convention on the Recognition and

          Enforcement of Foreign Arbitral Awards, done at New

          York, 10 June 1958 (hereinafter referred to as the "New

          York Convention"); and

      (iii) "the parties to a contract [to] have agreed in writing"

          for the purposes of article 1 of the UNCITRAL

          Arb i trat ion Rules.

   (b) Any arbitration under this Article shall at the request of

      any party to the dispute be held in a state that is a party

      to the New York Convention. Claims submitted to arbitration

      hereunder shall be considered to arise out of a commercial

      relationship or transaction for the purposes of article 1 of

      that Convent ion.

(6) A tribunal established under paragraph (4) shall decide the issues

   in dispute in accordance with this Treaty and applicable rules and

   principles of international law.

(7) An Investor other than a natural person which has the nationality

   of a Contracting Party party to the dispute on the date of the

   written request referred to in paragraph (4) and which, before a

   dispute between it and that Contracting Party arises, is

   controlled by Investors of another Contracting Party, shall for

   the purpose of article 25(2)(b) of the ICSID Convention be treated

   as a "national of another Contracting State" and shall for the

   purpose of article 1(6) of the Additional Facility Rules be

   treated as a "national of another State".

```

```
                   45

(8) The awards of arbitration, which may include an award of interest,

   shall be final and binding upon the parties to the dispute. An

   award of arbitration concerning a measure of a sub-national

   government or authority of the disputing Contracting Party shall

   provide that the Contracting Party may pay monetary damages in

   lieu of any other remedy granted. Each Contracting Party shall

   carry out without delay any such award and shall make provision

   for the effective enforcement in its Area of such awards.

                  ARTICLE 27

      SETTLEMENT OF DISPUTES BETWEEN CONTRACTING PARTIES

(1) Contracting Parties shall endeavour to settle disputes concerning

   the application or interpretation of this Treaty through

   diplomatic channels.

(2) If a dispute has not been settled in accordance with paragraph

   (1) within a reasonable period of time, either party thereto may,

   except as otherwise provided in this Treaty or agreed in writing

   by the Contracting Parties, and as concerns the application or

   interpretation of Article 6 or Article 19 or, for Contracting

   Parties listed in Annex IA, the last sentence of Article 10(1),

   upon written notice to the other party to the dispute submit the

   matter to an ad hoc tribunal under this Article.

(3) Such an ad hoc arbitral tribunal shall be constituted as follows:

   (a) The Contracting Party instituting the proceedings shall

      appoint one member of the tribunal and inform the other

      Contracting Party to the dispute of its appointment within 30

      days of receipt of the notice referred to in paragraph (2)

      by the other Contracting Party.

   (b) Within 60 days of the receipt of the written notice referred

      to in paragraph (2), the other Contracting Party party to the

      dispute shall appoint one member. If the appointment is not

      made within the time limit prescribed, the Contracting Party

```

```
                - 46

   having instituted the proceedings may, within 90 days of the

   receipt of the written notice referred to in paragraph (2)

   request that the appointment be made in accordance with

   paragraph (3)(d).

(c) A third member, who may not be a national or citizen of a

   Contracting Party party to the dispute, shall be appointed

   by the Contracting Parties parties to the dispute. That

   member shall be the President of the tribunal. If, within 150

   days of the receipt of the notice referred to in

   paragraph (2), the Contracting Parties are unable to agree on

   the appointment of a third member, that appointment shall be

   made, in accordance with paragraph (3)(d), at the request of

   either Contracting Party submitted within 180 days of the

   receipt of that notice.

(d) Appointments requested to be made in accordance with this

   paragraph shall be made by the Secretary-General of the

   Permanent Court of International Arbitration within 30 days

   of the receipt of a request to do so. If the Secretary
   General is prevented from discharging this task, the

   appointments shall be made by the First Secretary of the

   Bureau. If the latter, in turn, is prevented from discharging

   this task, the appointments shall be made by the most senior

   Deputy.

(e) Appointments made in accordance with paragraph (3)(a) to (d)

   shall be made with regard to the qualifications and

   experience, particularly in matters covered by this Treaty,

   of the members to be appointed.

(f) In the absence of an agreement to the contrary between the

   Contracting Parties, the Arbitration Rules of UNCITRAL shall

   govern, except to the extent modified by the Contracting

   Parties parties to the dispute or by the arbitrators. The

   tribunal shall take its decisions by a majority vote of its

   members.

```

```
                   - 47 
   (g) The tribunal shall decide the dispute in accordance with this

      Treaty and applicable rules and principles of international

      law.

   (h) The arbitral award shall be final and binding upon the

      Contracting Parties parties to the dispute.

   (i) Where, in making an award, a tribunal finds that a measure of

      a regional or local government or authority within the Area

      of a Contracting Party listed in Part I of Annex P is not in

      conformity with this Treaty, either party to the dispute may

      invoke the provisions of Part II of Annex P.

   (j) The expenses of the tribunal, including the remuneration of

      its members, shall be borne in equal shares by the

      Contracting Parties parties to the dispute. The tribunal

      may, however, at its discretion direct that a higher

      proportion of the costs be paid by one of the Contracting

      Parties parties to the dispute.

   (k) Unless the Contracting Parties parties to the dispute agree

      otherwise, the tribunal shall sit in The Hague, and use the

      premises and facilities of the Permanent Court of

      Arbitrât ion.

   (I) A copy of the award shall be deposited with the Secretariat

      which shall make it generally available.

                  ARTICLE 28

       NON-APPLICATION OF ARTICLE 27 TO TRADE DISPUTES

A dispute between Contracting Parties with respect to the application

of Article 5 or 29 shall not be settled under Article 27 unless the

Contracting Parties parties to the dispute so agree.

```

```
                   - 48 
                   PART VI

                 TRANSITIONAL

                  ARTICLE 29

        INTERIM PROVISIONS ON TRADE RELATED MATTERS

(1) The provisions of this Article shall apply to trade in Energy

   Materials and Products while any Contracting Party is not a party

   to the GATT and Related Instruments.

(2) (a) Trade in Energy Materials and Products between Contracting

      Parties at least one of which is not a party to the GATT or a

      relevant Related Instrument shall be governed, subject to

      sub-paragraphs (b) and (c) and to the exceptions and rules

      provided for in Annex G, by the provisions of the GATT and

      Related Instruments, as applied on 1 March 1994, and

      practised with regard to Energy Materials and Products by

      parties to the GATT among themselves, as if all Contracting

      Parties were parties to the GATT and applied the Related

      Instruments.

   (b) Such trade of a Contracting Party which is a state that was a

      constituent part of the former Union of Soviet Socialist

      Republics may instead be governed, subject to the provisions

      of Annex TFU, by an agreement between two or more such

      states, until 1 December 1999 or the admission of that

      Contracting Party to the GATT, whichever is the earlier.

   (c) As concerns trade between any two parties to the GATT, sub
      paragraph (a) shall not apply if either of those parties is

      not a party to GATT 1947.

(3) Each signatory to this Treaty, and each state or Regional Economic

   Integration Organization acceding to this Treaty shall, on the

   date of its signature or of its deposit of its instrument of

   accession, provide to the Secretariat a list of all tariff rates

```

```
                    - 49 
   and other charges levied on Energy Materials and Products at the

   time of importation or exportation, notifying the level of such

   rates and charges applied on such date of signature or deposit.

   Any changes to such rates or other charges shall be notified to

   the Secretariat which shall inform the Contracting Parties of such

   changes.

(4) Each Contracting Party shall endeavour not to increase any tariff

   rate or other charge levied at the time of importation or

   exportât ion

   (a) in the case of the importation of Energy Materials and

      Products described in Part I of the Schedule relating to the

      Contracting Party referred to in article II of the GATT,

      above the level set forth in that Schedule, if the

      Contracting Party is a party to the GATT;

   (b) in the case of the exportation of Energy Materials and

      Products and that of their importation if the Contracting

      Party is not a party to the GATT, above the level most

      recently notified to the Secretariat, except as permitted by

      the provisions made applicable by paragraph (2)(a).

(5) A Contracting Party may increase such tariff rate or other charge

   above the level referred to in paragraph (4) only if:

   (a) in the case of a rate or other charge levied at the time of

       importation, a provision of the GATT or of a Related

       Instrument, other than those listed in Annex G, permits such

      action; or

   (b) it has, to the fullest extent practicable under its

       legislative procedures, notified the Secretariat of its

      proposal for such an increase, given other interested

      Contracting Parties reasonable opportunity for consultation

      with respect to its proposal, and accorded consideration to

      any representations from such Contracting Parties.

```

```
                     50 
(6) Signatories undertake to commence negotiations not later than 1

   January 1995 with a view to concluding by 1 January 1998, as

   appropriate in the light of any developments in the world trading

   system, a text of an amendment to this Treaty which shall, subject

   to conditions to be laid down therein, commit each Contracting

   Party not to increase such tariffs or charges beyond the level

   prescribed under that amendment.

(7) Annex D to this Treaty shall apply to disputes regarding

   compliance with provisions applicable to trade under this Article

   and, unless both Contracting Parties agree otherwise, to disputes

   regarding compliance with Article 5 between Contracting Parties at

   least one of which is not a party to the GATT, except that Annex D

   shall not apply to any dispute between Contracting Parties, the

   substance of which arises under an agreement that:

   (a) has been notified in accordance with and meets the other

      requirements of paragraph (2)(b) and Annex TFU; or

   (b) establishes a free-trade area or a customs union as described

      in article XXIV of the GATT.

                  ARTICLE 30

      DEVELOPMENTS IN INTERNATIONAL TRADING ARRANGEMENTS

Contracting Parties undertake that in the I ight of the results of the

Uruguay Round of Multilateral Trade Negotiations embodied principally

in the Final Act thereof done at Marrakesh, 15 April 1994, they will

commence consideration not later than 1 July 1995 or- the entry into

force of this Treaty, whichever is the later, of appropriate amendments

to this Treaty with a view to the adoption of any such amendments by

the Charter Conference.

```

```
                    - 51 
                  ARTICLE 31

              ENERGY RELATED EQUIPMENT

The provisional Charter Conference shall at its first meeting commence

examination of the inclusion of energy related equipment in the trade

provisions of this Treaty.

                  ARTICLE 32

              TRANSITIONAL ARRANGEMENTS

(1) In recognition of the need for time to adapt to the requirements

   of a market economy, a Contracting Party listed in Annex T may

   temporarily suspend full compliance with its obligations under

   one or more of the following provisions of this Treaty, subject to

   the conditions in paragraphs (3) to (6):

   Article 6, paragraphs (2) and (5)

   Article 7, paragraph (4)

   Article 9, paragraph (1)

   Article 10, paragraph (7) - specific measures

   Article 14, paragraph (1)(d) - related only to transfer of unspent

           earnings

   Article 20, paragraph (3)

   Article 22, paragraphs (1) and (3)

(2) Other Contracting Parties shall assist any Contracting Party which

   has suspended full compliance under paragraph (1) to achieve the

   conditions under which such suspension can be terminated. This

   assistance may be given in whatever form the other Contracting

   Parties consider most effective to respond to the needs notified

   under paragraph (4)(c) including, where appropriate, through

   bilateral or multilateral arrangements.

```

```
                   - 52

(3) The applicable provisions, the stages towards full implementation

   of each, the measures to be taken and the date or, exceptionally,

   contingent event, by which each stage shall be completed and

   measure taken are listed in Annex T to this Treaty for each

   Contracting Party claiming transitional arrangements. Each such

   Contracting Party shall take the measure listed by the date

   indicated for the relevant provision and stage as set out in

   Annex T. Contracting Parties which have temporarily suspended full

   compliance under paragraph (1) undertake to comply fully with the

   relevant obligations by 1 July 2001. Should a Contracting Party

   find it necessary, due to exceptional circumstances, to request

   that the period of such temporary suspension be extended or that

   any further temporary suspension not previously listed in Annex T

   be introduced, the decision on a request to amend Annex T shall be

   made by the Charter Conference.

(4) A Contracting Party which has invoked transitional arrangements

   shall notify the Secretariat no less often than once every 12

   months :

   (a) of the implementation of any measures listed in its Annex T

      and of its general progress to full compliance;

   (b) of the progress it expects to make during the next 12 months

      towards full compliance with its obligations, of any problem

      it foresees and of its proposals for dealing with that

      problem;

   (c) of the need for technical assistance to facilitate completion

      of the stages set out in Annex T as necessary for the ful I

      implementation of this Treaty, or to deal with any problem

      notified pursuant to sub-paragraph (b) as well as to promote

      other necessary market oriented reforms and modernization of

      its energy sector-,

   (d) of any possible need to make a request of the kind referred

      to in paragraph (3).

```

```
                 53

(5) The Secretariat shall:

   (a) circulate to all Contracting Parties the notifications

      referred to in paragraph (4);

   (b) circulate and actively promote, relying where appropriate on

      arrangements existing within other international

      organizations, the matching of needs for and offers of

      technical assistance referred to in paragraphs (2) and

      (4)(c);

   (c) circulate to all Contracting Parties at the end of each six

      month period a summary of any notifications made under

      paragraph (4)(a) or (d).

(6) The Charter Conference shall annually review the progress by

   Contracting Parties towards implementation of the provisions of

   this Article and the matching of needs and offers of technical

   assistance referred to in paragraphs (2) and (4)(c). In the course

   of that review it may decide to take appropriate action.

```

```
                   - 54 
                   PART VI I

             STRUCTURAL AND INSTITUTIONAL

                  ARTICLE 33

         ENERGY CHARTER PROTOCOLS ANO DECLARATIONS

(1) The Charter Conference may authorize the negotiation of a number

   of Energy Charter Protocols or Declarations in order to pursue the

   objectives and principles of the Charter.

(2) Any signatory to the Charter may participate in such negotiation.

(3) A state or Regional Economic Integration Organization shall not

   become a party to a Protocol or Declaration unless it is, or

   becomes at the same time, a signatory to the Charter and a

   Contracting Party to this Treaty.

(4) Subject to paragraphs (3) and (6)(a), final provisions applying to

   a Protocol shall be defined in that Protocol.

(5) A Protocol shall apply only to the Contracting Parties which

   consent to be bound by it, and shall not derogate from the rights

   and obligations of those Contracting Parties not party to the

   Protocol.

(6) (a) A Protocol may assign duties to the Charter Conference and

      functions to the Secretariat, provided that no such

      assignment may be made by an amendment to a Protocol unless

      that amendment is approved by the Charter Conference, whose

      approval shall not be subject to any provisions of the

      Protocol which ?re authorized by sub-paragraph (b).

   (b) A Protocol which provides for decisions thereunder to be

      taken by the Charter Conference may, subject to sub
      paragraph (a), provide with respect to such decisions:

```

```
                   - 55 
      (i) for voting rules other than those contained in

         Article 36;

      (ii) that only parties to the Protocol shall be considered to

         be Contracting Parties for the purposes of Article 36 or

         eligible to vote under the rules provided for in the

         Protocol.

                  ARTICLE 34

                CHARTER CONFERENCE

(1) The Contracting Parties shall meet periodically in a Conference

   (hereinafter referred to as "the Charter Conference") at which

   each Contracting Party shall be entitled to have one

   representative. Ordinary meetings shall be held at intervals

   determined by the Charter Conference.

(2) Extraordinary meetings of the Charter Conference may be held at

   such times as may be determined by the Charter Conference, or at

   the written request of any Contracting Party, provided that,

   within six weeks of the request being communicated to the

 , Contracting Parties by the Secretariat, it is supported by at

   least one-third of the Contracting Parties.

(3) The functions of the Charter Conference shall be to:

   (a) carry out the duties assigned to it by this Treaty and any

      Protocols;

   (b) keep under review and facilitate the implementation of the

      principles of the Charter and of the provisions of this

      Treaty and the Protocols;

   (c) facilitate in accordance with this Treaty and the Protocols

      the co-ordination of appropriate general measures to carry

      out the principles of the Charter;

   (d) consider and adopt programmes of work to be carried out by

      the Secretar iat;

```

```
                     56 
   (e) consider and approve the annual accounts and budget of the

      Secretar iat ;

   (f) consider and approve or adopt the terms of any headquarters

      or other agreement, including privileges and immunities

      considered necessary for the Charter Conference and the

      Secretariat;

   (g) encourage co-operative efforts aimed at facilitating and

      promoting market oriented reforms and modernization of energy

      sectors in those countries of Central and Eastern Europe and

      the former Union of Soviet Socialist Republics undergoing

      economic transition;

   (h) authorize and approve the terms of reference for the

      negotiation of Protocols, and consider and adopt the texts

      thereof and of amendments thereto;

   (i) authorize the negotiation of Declarations, and approve their

      issuance;

   (j) decide on accessions to this Treaty;

   (k) authorize the negotiation of and consider and approve or

      adopt association agreements;

   (I) consider and adopt texts of amendments to this Treaty;

   (m) consider and approve modifications of and technical changes

      to the Annexes to this Treaty;

   (n) appoint the Secretary-General and take all decisions

      necessary for the establishment and functioning of the

      Secretariat including the structure, staff levels and

      standard terms of employment of officials and employees.

(4) In the performance of its duties, the Charter Conference, through

   the Secretariat, shall co-operate with and make as full a use as

   possible, consistently with economy and efficiency, of the

   services and programmes of other institutions and organizations

   with established competence in matters related to the objectives

   of this Treaty.

(5) The Charter Conference may establish such subsidiary bodies as it

   considers appropriate for the performance of its duties.

(6) The Charter Conference shall consider and adopt rules of procedure

   and financial rules.

```

```
                     57 
(7) In 1999 and thereafter at intervals (of not more than five years)

   to be determined by the Charter Conference, the Charter Conference

   shall thoroughly review the functions provided for in this Treaty

   in the light of the extent to which the provisions of this Treaty

   and Protocols have been implemented. At the conclusion of each

   review the Charter Conference may amend or abolish the functions

   specified in paragraph (3) and may discharge the Secretariat.

                  ARTICLE 35

                  SECRETARIAT

(1) In carrying out its duties, the Charter Conference shall have a

   Secretariat which shall be composed of a Secretary-General and

   such staff as are the minimum consistent with efficient

   performance.

(2) The Secretary-General shall be appointed by the Charter

   Conference. The first such appointment shall be for a maximum

   per iod of f i ve years.

(3) In the performance of its duties the Secretariat shall be

   responsible to and report to the Charter Conference.

(4) The Secretariat shall provide the Charter Conference with all

   necessary assistance for the performance of its duties and shall

   carry out the functions assigned to it in this Treaty or in any

   Protocol and any other functions assigned to it by the Charter

   Conference.

(5) The Secretariat may enter into such administrative and contractual

   arrangements as may be required for the effective discharge of its

   funct ions.

```

```
                   - 58 
                  ARTICLE 36

                   VOTING

(1) Unanimity of the Contracting Parties Present and Voting at the

   meeting of the Charter Conference where such matters fall to be

   decided shall be required for decisions by the Charter Conference

   to:

   (a) adopt amendments to this Treaty other than amendments to

      Articles 34 and 35 and Annex T;

   (b) approve accessions to this Treaty under Article 41 by states

      or Regional Economic Integration Organizations which were not

      signatories to the Charter as of 16 June 1995;

   (c) authorize the negotiation of and approve or adopt the text of

      association agreements;

   (d) approve modifications to Annexes EM, NI, G and B;

   (e) approve technical changes to the Annexes to this Treaty; and

   (f) approve the Secretary-General's nominations of panelists

      under Annex D, paragraph (7).

   The Contracting Parties shall make every effort to reach agreement

   by consensus on any other matter requiring their decision under

   this Treaty. If agreement cannot be reached by consensus,

   paragraphs (2) to (5) shall apply.

(2) Decisions on budgetary matters referred to in Article 34(3)(e)

   shall be taken by a qualified majority of Contracting Parties

   whose assessed contributions as specified in Annex B represent, in

   combination, at least three-fourths of the total assessed

   contributions specified therein.

(3) Decisions on matters referred to in Article 34(7) shall be taken

   by a three-fourths majority of the Contracting Parties.

```

```
                   - 59 
(4) Except in cases specified in paragraphs (1)(a) to (f), (2) and (3)

   or as otherwise specified elsewhere in this Treaty, decisions

   provided for in this Treaty shall be taken by a three-fourths

   majority of the Contracting Parties Present and Voting at the

   meeting of the Charter Conference at which such matters fall to be

   decided.

(5) For purposes of this Article,"Contracting Parties Present and

   Voting" means Contracting Parties present and casting affirmative

   or negative votes, provided that the Charter Conference may decide

   upon rules of procedure to enable such decisions to be taken by

   Contracting Parties by correspondence.

(6) Except as provided in paragraph (2), no decision referred to in

   this Article shall be valid unless it has the support of a simple

   majority of the Contracting Parties.

(7) A Regional Economic Integration Organization shall, when voting,

   have a number of votes equal to the number of its member states

   which are Contracting Parties to this Treaty; provided that such

   an Organization shall not exercise its right to vote if its member

   states exercise theirs, and vice versa.

(8) In the event of persistent arrears in a Contracting Party's

   discharge of financial obligations under this Treaty, the Charter

   Conference may suspend that Contracting Party's voting rights in

   whole or in part.

                  ARTICLE 37

                FUNDING PRINCIPLES

(1) Each Contracting Party shall bear its own costs of representation

   at meetings of the Charter Conference and any subsidiary bodies.

(2) The cost of meetings of the Charter Conference and any subsidiary

   bodies shall be regarded as a cost of the Secretariat.

```

```
                   - 60 
(3) The costs of the Secretariat shall be met by the Contracting

   Parties assessed according to their capacity to pay, determined as

   specified in Annex B, the provisions of which may be modified in

   accordance with Article 36(1)(d).

(4) A Protocol shall contain provisions to assure that any costs of

   the Secretariat arising from that Protocol are borne by the

   parties thereto.

(5) The Charter Conference may in addition accept voluntary

   contributions from one or more Contracting Parties or from other

   sources. Costs met from such contributions shall not be

   considered costs of the Secretariat for the purposes of

   paragraph (3).

```

```
                   - 61 
                   PART VIII

                 FINAL PROVISIONS

                  ARTICLE 38

                   SIGNATURE

This Treaty shall be open for signature at Lisbon from 17 December 1994

to 16 June 1995 by the states and Regional Economic Integration

Organizations which have signed the Charter.

                  ARTICLE 39

           RATIFICATION, ACCEPTANCE OR APPROVAL

This Treaty shall be subject to ratification, acceptance or approval by

signatories. Instruments of ratification, acceptance or approval shall

be deposited with the Depositary.

                  ARTICLE 40

            APPLICATION TO OTHER TERRITORIES

(1) Any state or Regional Economic Integration Organization may at the

   time of signature, ratification, acceptance, approval or

   accession, by a declaration deposited with the Depositary,

   declare that the Treaty shall be binding upon it with respect to

   all the other territories for the international relations of which

   it is responsible, or to one or more of them. Such declaration

   shall take effect at the time the Treaty enters into force for

   that Contracting Party.

```

```
                    - 62 
(2) Any Contracting Party may at a later date, by a declaration

   deposited with the Depositary, bind itself under this Treaty with

   respect to other territory specified in the declaration. In

   respect of such territory the Treaty shall enter into force on the

   ninetieth day following the receipt by the Depositary of such

   declaration.

(3) Any declaration made under the two preceding paragraphs may, in

   respect of any territory specified in such declaration, be

   withdrawn by a notification to the Depositary. The withdrawal

   shall, subject to the applicability of Article 47(3),. become

   effective upon the expiry of one year after the date of receipt of

   such notification by the Depositary.

                   ARTICLE 41

                   ACCESSION

This Treaty shall be open for access ion, from the date on which the

Treaty is closed for signature, by states and Regional Economic

Integration Organizations which have signed the Charter, on terms to be

approved by the Charter Conference. The instruments of accession shall

be deposited with the Depositary.

                  ARTICLE 42

                   AMENDMENT

(1) Any Contracting Party may propose amendments to this Treaty.

(2) The text of any proposed amendment to this Treaty shall be

   communicated to the Contracting Parties by the Secretariat at

   least three months before the date on which it is proposed for

   adoption by the Charter Conference.

```

```
                   - 63 
(3) Amendments to this Treaty, texts of which have been adopted by the

   Charter Conference, shall be communicated by the Secretariat to

   the Depositary which shall submit them to all Contracting Parties

   for ratification, acceptance or approval.

(4) Ratification, acceptance or approval of amendments to this Treaty

   shall be notified to the Depositary in writing. Amendments shall

   enter into force between Contracting Parties having ratified,

   accepted or approved them on the ninetieth day after the receipt

   by the Depositary of notification of their ratification,

   acceptance or approval by at least three-fourths of the

   Contracting Parties. Thereafter the amendments shall enter into

   force for any other Contracting Party on the ninetieth day after

   that Contracting Party deposits its instrument of ratification,

   acceptance or approval of the amendments.

                  ARTICLE 43

               ASSOCIATION AGREEMENTS

(1) The Charter Conference may authorize the negotiation of

   association agreements with states or Regional Economic

   Integration Organizations, or with international organizations, in

   order to pursue the objectives and principles of the Charter and

   the provisions of this Treaty or one or more Protocols.

(2) The relationship established with and the rights enjoyed and

   obligations incurred by an associating state, Regional Economic

   Integration Organization, or international organization shall be

   appropriate to the particular circumstances of the association,

   and in each case shall be set out in the association agreement.

```

```
                   - 64

                  ARTICLE 44

                 ENTRY INTO FORCE

(1) This Treaty shall enter into force on the ninetieth day after the

   date of deposit of the thirtieth instrument of ratification,

   acceptance or approval thereof, or of accession thereto by a state

   or Regional Economic Integration Organization which was a

   signatory to the Charter as of 16 June 1995.

(2) For each state or Regional Economic Integration Organization

   which ratifies, accepts or approves this Treaty or accedes thereto

   after the deposit of the thirtieth instrument of ratification,

   acceptance or approval, it shall enter into force on the ninetieth

   day after the date of deposit by such state or Regional Economic

   Integration Organization of its instrument of ratification,

   acceptance, approval or accession.

(3) For the purposes of paragraph (1), any instrument deposited by a

   Regional Economic Integration Organization shall not be counted as

   additional to those deposited by member states of such

   Organizat ion.

                  ARTICLE 45

              PROVISIONAL APPLICATION

(1) Each signatory agrees to apply this Treaty provisionally pending

   its entry into force for such signatory in accordance with Article

   44, to the extent that such provisional application is not

   inconsistent with its constitution, laws or regulations.

(2) (a) Notwithstanding paragraph (1) any signatory may, when

      signing, deliver to the Depositary a declaration that it is

      not able to accept provisional application. The obligation

```

```
                    - 65 
      contained in paragraph (1) shall not apply to a signatory

      making such a declaration. Any such signatory may at any time

      withdraw that declaration by written notification to the

      Depositary.

   (b) Neither a signatory which makes a declaration in accordance

      with paragraph (2)(a) nor Investors of that signatory may

      claim the benefits of provisional application under paragraph

       (1).

   (c) Notwithstanding paragraph (2)(a), any signatory making a

      declaration referred to in paragraph (2)(a) shall apply

      Part VI I provisionally, and shall apply paragraphs (4) and

       (7), pending the entry into force of the Treaty in

      accordance with Article 44, to the extent that such

      provisional application is not inconsistent with its laws or

      régulât ions.

(3) (a) Any signatory may terminate its provisional application of

      this Treaty by written notification to the Depositary of its

      intention not to become a Contracting Party to this Treaty.

      Termination of provisional application for any signatory

      shall take effect upon the expiration of 60 days from the

      date on which such signatory's written notification is

      received by the Depositary.

   (b) In the event that a signatory terminates provisional

      application under paragraph (3)(a), the obligation of the

      signatory under paragraph (1) to apply Parts III and V with

      respect to any Investments made in its Area' during such

      provisional application by Investors of other signatories

      shall nevertheless remain in effect with respect to those

       Investments for twenty years following the effective date of

      termination, except as otherwise provided in paragraph

       (3)(c).

```

```
                   - 66

   (c) Paragraph (3)(b) shall not apply to any signatory listed in

      Annex PA. A signatory shall be removed from the list in

      Annex PA effective upon delivery to the Depositary of a

      request therefor.

(4) Pending the entry into force of this Treaty the signatories shall

   meet periodically in the provisional Charter Conference, the first

   meeting of which shall be convened by the provisional Secretariat

   designated under paragraph (5) not later than 180 days after the

   opening date for signature of this Treaty as specified in

   Article 38.

(5) The functions of the Secretariat shall be carried out on an

   interim basis by a provisional Secretariat until the entry into

   force of this Treaty pursuant to Article 44 and the appointment of

   a Secretariat under Article 35.

(6) The signatories shall, in accordance with and subject to the

   provisions of paragraph (1) or (2)(c) as appropriate, contribute

   to the costs of the provisional Secretariat as if the signatories

   were Contracting Parties under Article 37(3). Any modifications

   made to Annex B by the signatories shall terminate upon the entry

   into force of this Treaty.

(7) A state or Regional Economic Integration Organization which, prior

   to the Treaty's entry into force, accedes to this Treaty in

   accordance with Article 41 shall, pending the Treaty's entry into

   force, have the rights and assume the obligations of a signatory

   under th is Art icle.

                  ARTICLE 46

                  RESERVATIONS

No reservations may be made to this Treaty.

```

```
                    67 
                  ARTICLE 47

                  WITHDRAWAL

(1) At any time after five years from the date on which this Treaty

   has entered into force for a Contracting Party, that Contracting

   Party may give written notification to the Depositary of its

   withdrawal from this Treaty.

(2) Any such withdrawal shall take effect upon the expiry of one year

   after the date of the receipt of the notification by the

   Depositary, or on such later date as may be specified in the

   notification of withdrawal.

(3) The provisions of this Treaty shall continue to apply to

   Investments made in the Area of a Contracting Party by Investors

   of other Contracting Parties or in the Area of other Contracting

   Parties by Investors of that Contracting Party as of the date when

   that Contracting Party's withdrawal from this Treaty takes effect

   for a period of 20 years from such date.

(4) All Protocols to which a Contracting Party is party shall cease

   to be in force for that Contracting Party on the effective date of

   its withdrawal from this Treaty.

                  ARTICLE 48

            STATUS OF ANNEXES AND DECISIONS

The Annexes to this Treaty and Decisions No 1, 2, 3 and 4 annexed to

the Final Act of the European Energy Charter Conference signed at

Lisbon on 17 December 1994 are integral parts of this Treaty.

```

```
                    - 68 
                  ARTICLE 49

                  DEPOSITARY

The Government of the Portuguese Republic shall be the Depositary of

this Treaty.

                  ARTICLE 50

                 AUTHENTIC TEXTS

In witness whereof the undersigned, being duly authorized to that

effect, have signed this Treaty in English, French, German, Italian,

Russian and Spanish, of which every text is equally authentic, in one

original, which will be deposited with the Government of the Portuguese

Republ ic.

Done at Lisbon on the seventeenth day of December in the year one

thousand nine hundred and ninety-four.

```

**14 September 1994**

**TEXT** **FOR** **ADOPTION**

**ANNEXES** **TO** **THE** **ENERGY CHARTER** **TREATY**

```
                    - 1 
           T A B L E O F C O N T E N T S

                                       Page

1 . ANNEX EM

  ENERGY MATERIALS AND PRODUCTS

  (In accordance with Article 1(4)) 3

2. ANNEX NI

  NON-APPLICABLE ENERGY MATERIALS AND PRODUCTS

  FOR DEFINITION OF "ECONOMIC ACTIVITY IN THE ENERGY SECTOR"

   (In accordance with Article 1(5)) 6

3. ANNEX TRM

  NOTIFICATION AND PHASE-OUT (TRIMs)

   (In accordance with Article 5(4)) 7

4. ANNEX N

  LIST OF CONTRACTING PARTIES REQUIRING AT LEAST *

  3 SEPARATE AREAS TO BE INVOLVED IN A TRANSIT

   (In accordance with Article 7(10)(a)) 9

5. ANNEX VC

  LIST OF CONTRACTING PARTIES WHICH HAVE MADE VOLUNTARY

  BINDING COMMITMENTS IN RESPECT OF ARTICLE 10(3)

   (In accordance with Article 10(6)) 10

6. ANNEX ID

  LIST OF CONTRACTING PARTIES NOT ALLOWING AN INVESTOR TO

  RESUBMIT THE SAME DISPUTE TO INTERNATIONAL ARBITRATION

  AT A LATER STAGE UNDER ARTICLE 26

   (In accordance with Article 26(3)(b)(i)) 11

7. ANNEX IA

   LIST OF CONTRACTING PARTIES NOT ALLOWING AN INVESTOR TO

   SUBMIT A DISPUTE CONCERNING THE LAST SENTENCE OF

  ARTICLE 10(1) TO INTERNATIONAL ARBITRATION

   (In accordance with Art.iclè 26(3)(c)) 12

8. ANNEX P

   SPECIAL SUB-NATIONAL DISPUTE PROCEDURE

   (In accordance with Article 27(3) ( i.) ) 13

9. ANNEX G

   EXCEPTIONS AND RULES GOVERNING THE APPLICATION OF

   THE PROVISIONS OF THE GATT AND RELATED INSTRUMENTS

   (In accordance with Article 29(2)(a)) 16

10. ANNEX TFU

   PROVISIONS FOR TRADE AGREEMENTS BETWEEN STATES

   WHICH WERE CONSTITUENT PARTS OF THE FORMER UNION

   OF SOVIET SOCIALIST REPUBLICS

   (In accordance with Article 29(2)(b)) 21

```

```
                    - 2 
11. ANNEX D

   INTERIM PROVISIONS FOR TRADE DISPUTE SETTLEMENT

  (In accordance with Article 29(7)) 24

12. ANNEX B

  FORMULA FOR ALLOCATING CHARTER COSTS

  (In accordance with Article 37(3)) 33

13. ANNEX PA

  LIST OF SIGNATORIES WHICH DO NOT ACCEPT THE

  PROVISIONAL APPLICATION OBLIGATION OF ARTICLE 45(3)(b)

  (In accordance with Article 45(3)(c)) 34

14. ANNEX T

  LIST OF CONTRACTING PARTIES' TRANSITIONAL MEASURES

   (In accordance with Article 32(1)) 35

```

```
                    - 3 
                  1. ANNEX EM

             ENERGY MATERIALS AND PRODUCTS

           (In accordance with Article 1(4))

Nuclear 26.12 Uranium or thorium ores and concentrates.

Energy

           26.12.10 Uranium ores and concentrates.

           26.12.20 Thorium ores and concentrates.

      28.44 Radioactive chemical elements and radioactive

           isotopes (including the fissile or fertile chemical

           elements and isotopes) and their compounds-, mixtures

           and residues containing these products.

           28.44.10 Natural uranium and its compounds.

           28.44.20 Uranium enriched in U235 and its

                  compounds; plutonium and its compounds.

           28.44.30 Uranium depleted in U235 and its

                  compounds; thorium and its compounds.

           28.44.40 Radioactive elements and isotopes- and

                  radioactive compounds other than

                  28.44.10, 28.44.20 or 28.44.30.

           28.44.50 Spent (irradiated) fuel elements

                  (cartridges) of nuclear reactors.

      28.45.10 Heavy water (deuterium oxide).

```

```
Coal, Natural 27.01

Gas, Petroleum

and Petroleum

Products, 27.02

Electr ica I

Energy

```

```
      - 4 
Coal, briquettes, ovoids and similar solid

fuels manufactured from coal.

Lignite, whether or not agglomerated

excluding jet.

```

```
27.03 Peat (including peat litter), whether or not

     agglomerated.

27.04 Coke and semi-coke or coal, of lignite or of

     peat, whether or not agglomerated; retort

     carbon.

27.05 Coal gas, water gas, producer gas and similar

     gases, other than petroleum gases and other

     gaseous hydrocarbons.

27.06 Tar distilled from coal, from lignite or from

     peat, and other mineral tars, whether or not

    • dehydrated or partially distilled, including

     reconstituted tars.

27.07 Oils and other products of the distillation of

     high temperature coal tar-, similar products in

     which the weight of the aromatic constituents

     exceeds that of the non-aromatic constituents

     (e.g., benzole, toluole, xylole, naphtalene,

     other aromatic hydrocarbon mixtures,phenols,

     creosote oils and others).

27.08 Pitch and pitch coke, obtained from coal tar or

     from other mineral tars.

27.09 Petroleum oils and oils obtained from bituminous

     minerals, crude.

27.10 Petroleum oils and oils obtained from bituminous

     minerals, other than crude.

```

```
Other Energy

```

```
            - 5

27.11 Petroleum gases and other gaseous hydrocarbons

      L iqu i f ied:

      - natural gas

      - propane

      - butanes

      - ethylene, propylene, butylène and butadiene

       (27.11.14)

      - other

      In gaseous state:

      - natural gas

      - other

 27.13 Petroleum coke, petroleum bitumen and other

      residues of petroleum oils or of oils obtained

      from bituminous minerals.

 27.14 Bitumen and asphalt, natural; bituminous or oil

      shale and tar sands; asphaltites and asphaltic

      rocks.

 27.15 Bituminous mixtures based on natural asphalt,

      on natural bitumen, on petroleum bitumen, on

      mineral tar or on mineral tar pitch (e.g.,

      bituminous mastics, cut-backs).

 27.16 Electrical energy.

44.01.10 Fuel wood, in logs, in billets, in twigs, in

      faggots or in similar forms.

44.02 Charcoal (including charcoal from shells or

      nuts), whether or not agglomerated.

```

```
                    - 6 
                   2. ANNEX NI

        NON-APPLICABLE ENERGY MATERIALS AND PRODUCTS

    FOR DEFINITION OF "ECONOMIC ACTIVITY IN THE ENERGY SECTOR

            (In accordance with Article 1(5))

27.07 Oils and other products of the distillation of high

      temperature coal tar-, similar products in which the weight of

      the aromatic constituents exceeds that of the non-aromatic

      constituents (e.g., benzole, toluole, xylole, naphtalene,

      other aromatic hydrocarbon mixtures, phenols, creosote oils

      and others) .

44.01.10 Fuel wood, in logs, in billets, in twigs, in faggots or in

      s imi lar forms.

44.02 Charcoal (including charcoal from shells or nuts), whether

      or not agglomerated.

```

```
                     - 7 
                   3. ANNEX TRM

            NOTIFICATION AND PHASE-OUT (TRIMs)

            (In accordance with Article 5(4))

(1) Each Contracting Party shall notify to the Secretariat. a I I trade

    related investment measures which it applies that are not in

    conformity with the provisions of Article 5, within:

    (a) 90 days after the entry into force of this Treaty if the

       Contracting Party is a party to the GATT; or

    (b) 12 months after the entry into force of this Treaty if the

      Contracting Party is not a party to the GATT.

    Such trade related investment measures of general or specific

    application shall be notified along with their principal

    features.

(2) In the case of trade related investment measures applied under

    discretionary authority, each specific application shall- be

    notified. Information that would prejudice the legitimate

    commercial interests of particular enterprises need not be

    d isclosed.

(3) Each Contracting Party shall eliminate all trade related

    investment measures which are notified under paragraph (1) within

    (a) two years from the date of entry into force of this Treaty if

       the Contracting Party is a party to the GATT; or

    (b) three years from the date of entry into force of this Treaty

       if the Contracting Party is not a party to the GATT.

(4) During the applicable period referred to in paragraph (3) a

    Contracting Party shall not modify the terms of any trade related

    investment measure which it notifies under paragraph (1) from

    those prevailing at the date of entry into force of this Treaty

    so as to increase the degree of inconsistency with the provisions

    of Article 5 of this Treaty.

```

```
                - 8

(5) Notwithstanding the provisions of paragraph (4), a Contracting

    Party, in order not to disadvantage established enterprises which

    are subject to a trade related investment measure notified under

    paragraph (1), may apply during the phase-out period the same

    trade related investment measure to a new Investment where

    (a) the products of such Investment are I ike products to those

      of the established enterprises; and

    (b) such application is necessary to avoid distorting the

      conditions of competition between the new Investment and the

      established enterprises.

    Any trade related investment measure so applied to a new

    Investment shall be notified to the Secretariat. The terms of

    such a trade related investment measure shall be equivalent in

    their competitive effect to those applicable to the established

    enterprises, and it shall be terminated at the same time.

(6) Where a state or Regional Economic Integration Organization

    accedes to this Treaty after the Treaty has entered into force:

    (a) the notification referred to in paragraphs (1) and (2) shall

      be made by the later of the applicable date in paragraph (1)

      or the date of deposit of the instrument of accession; and

    (b) the end of the phase-out period shall be the later of the

      applicable date in paragraph (3) or the date on which the

      Treaty enters into force for that state or Regional Economic

      Integration Organization.

```

```
                    - 9 
                  4. ANNEX N

    LIST OF CONTRACTING PARTIES REQUIRING AT LEAST 3 SEPARATE

           AREAS TO BE INVOLVED IN A TRANSIT

          (In accordance with Article 7(10)(a))

1. Canada and United States of America

```

```
             - 10 
             5. ANNEX VC

LIST OF CONTRACTING PARTIES WHICH HAVE MADE VOLUNTARY

  BINDING COMMITMENTS IN RESPECT OF ARTICLE 10(3)

      (In accordance with Article 10(6))

```

```
                  - 11 
                6. ANNEX ID

LIST OF CONTRACTING PARTIES NOT ALLOWING AN INVESTOR TO RESUBMIT

      THE SAME DISPUTE TO INTERNATIONAL ARBITRATION

          AT A LATER STAGE UNDER ARTICLE 26

        (In accordance with Article 26(3)(b)(i))

  1. Australia 13. Ireland

  2. Azerbaijan 14. Italy

  3. Bulgaria 15. Japan

  4. Canada 16. Kazakhstan

  5. Croatia 17. Poland

  6. Cyprus 18. Portugal

  7. The Czech Republic 19. Romania

  8. Estonia 20. The Russian Federation

  9. European Communities 21. Slovenia

  10. Finland 22. Spain

  11. Greece 23. Sweden

  12. Hungary 24. United States of America

```

```
              - 12 
            7. ANNEX IA

LIST OF CONTRACTING PARTIES NOT ALLOWING AN INVESTOR

 TO SUBMIT A DISPUTE CONCERNING THE LAST SENTENCE

  OF ARTICLE 10(1) TO INTERNATIONAL ARBITRATION

     (In accordance with Article 26(3)(c))

1. Austra I i a

2. Canada

3. Hungary

4. Norway

```

```
                   - 13 
                  8. ANNEX P

          SPECIAL SUB-NATIONAL DISPUTE PROCEDURE

          (In accordance with Article 27(3) (i))

PART

1. Canada

2. AustraI i a

PART I I

(1) Where, in making an award, the tribunal finds that a measure of a

  regional or local government or authority of a Contracting Party

  (hereinafter referred to as "the responsible Contracting Party") is

  not in conformity with a provision of this Treaty, the responsible

  Contracting Party shall take such reasonable measures as may be

  available to it to ensure observance of this Treaty in respect of

  the measure.

(2) The responsible Contracting Party shall, within 30 days from the

  date the award is made, provide to the Secretariat written notice

  of its intentions as to ensuring observance of the Treaty in

  respect of the measure. The Secretariat shall present the

  notification to the Charter Conference at the earliest practicable

  opportunity, and no later than the meeting of the Charter

  Conference following receipt of the notice. If it is impracticable

  to ensure observance immediately, the responsible Contracting Party

  shall have a reasonable period of time in which to do so. The

  reasonable period of time shall be agreed by both parties to the

  dispute. In the event that such agreement is not reached, the

  responsible^Contracting Party shall propose a reasonable period for

  approval by the Charter Conference.

```

```
                   - 14 
(3) Where the responsible Contracting Party fails, within the

   reasonable period of time, to ensure observance in respebt of the

  measure, it shall at the request of the other Contracting Party

  party to the dispute (hereinafter referred to as "the injured

  Contracting Party") endeavour to agree with the injured Contracting

  Party on appropriate compensation as a mutually satisfactory

   resolution of the dispute.

(4) If no satisfactory compensation has been agreed within 20 days of

   the request of the injured Contracting Party, the injured

   Contracting Party may with the authorization of the* Charter

   Conference suspend such of its obligations to the responsible

   Contracting Party under the Treaty as it considers equivalent to

   those, denied by the measure in question, until such time as the

   Contracting Parties have reached agreement on a resolution of their

   dispute or the non-conforming measure has been brought into

   conformity with the Treaty.

(5) In considering what obligations to suspend, the injured Contracting

   Party shall apply the following principles and procedures:

   (a) The injured Contracting Party should first seek to suspend

     obligations with respect to the same Part of the Treaty as that

     in which the tribunal has found a violation.

   (b) If the injured Contracting Party considers that it is not

     practicable or effective to suspend obiigations with respect to

     the same Part of the Treaty, it may seek to suspend obligations

     in other Parts of the Treaty. If the injured Contracting Party

     decides to request authorization to suspend obligations under

     this sub-paragraph, it shall state the reasons therefor in its

     request to the Charter Conference for authorization.

(6) On written request of the responsible Contracting Party, delivered

   to the injured Contracting Party and to the President of the

   tribunal that rendered the award, the tribunal shall determine

   whether the level of obligations suspended by the injured

   Contracting Party is excessive, and if so, to what extent. If the

```

```
                   - 15 
  tribunal cannot be reconstituted, such determination shall be made

  by one or more arbitrators appointed by the Secretary-General.

  Determinations pursuant to this paragraph shall be completed within

  60 days of the request to the tribunal or the appointment by the

  Secretary-General. Obligations shall not be suspended pending the

  determination, which shall be final and binding.

(7) In suspending any obligations to a responsible Contracting Party,

  an injured Contracting Party shall make every effort not to affect

  adversely the rights under the Treaty of any other Contracting

  Party.

```

```
                    16 
                  9. ANNEX G

     EXCEPTIONS AND RULES GOVERNING THE APPLICATION OF THE

       PROVISIONS OF THE GATT AND RELATED INSTRUMENTS

          (In accordance with Article 29(2)(a))

(1) The following provisions of the GATT and Related Instruments shall

  not be applicable under Article 29(2)(a):

  (a) General Agreement on Tariffs and Trade

     II Schedules of Concessions (and the Schedules to the

           General Agreement on Tariffs and Trade)

     IV Special Provisions relating to Cinematographic Films

     XV Exchange Arrangements

     XVlll Governmental Assistance to Economic Development

     XXI I Consul tat ion

     XXIII Nul I ification or Impairment

     XXV Joint Action by the Contracting Parties

     XXVI Acceptance. Entry into Force and Registration

     XXVII Withholding or Withdrawal of Concessions

     XXVIII Modification of Schedules

     XXVI I Ibis Tariff Negotiations

     XXIX The relation of this Agreement to the Havana Charter

     XXX Amendments

     XXXI Withdrawal

     XXXII Contracting Parties

     XXX I I I Accession

     XXXV Non-application of the Agreement between particular

           Contract ing Part ies

     XXXVI Principles and Objectives

     XXXVII Commitments

     XXXVI I I Joint Act ion

     Annex H Relating to Article I

     Annex I Notes and Supplementary Provisions (related to above

           GATT art icles)

```

```
                  - 17 
  Safeguard Action for Development Purposes

  Understanding Regarding Notification, Consultation, Dispute

  Settlement and Surveillance.

(b) Related Instruments

   (i) Agreement on Technical Barriers to Trade (Standards Code)

      Preamble (t irets 1, 8, 9 )

       1.3 General provisions

      2.6.4 Preparation, adoption and application of

            technical regulations and standards by central

            government bodies

       10.6 Information about technical regulations,

            standards and certification systems

       11 Technical assistance to other Parties

       12 Special and differential treatment of developing

            countries

       13 The Committee on Technical Barriers to Trade

       14 Consultation and dispute settlement

       15. Final provisions (other than 15.5 and 15.13)

      Annex 2 Technical Expert Groups

      Annex 3 Panels

   (i i) Agreement on Government Procurement

   (iii) Agreement on Interpretation and Application of Articles

       VI, XVI and XXIII (Subsidies and Countervailing Measures)

       10 Export subsidies on certain primary products

       12 Consul tat ions

       13 Conciliation, dispute settlement and authorized

            countermeasures

       14 Developing countries

       16 Committee on Subsidies and Countervailing

            Measures

       17 Cone i I iat ion

       18 Dispute settlement

```

```
            - 18 
19.2 Acceptance and accession

19.4 Entry into force

19.5(a) National legislation

19.6 Review

19.7 Amendments

19.8 Withdrawal

19.9 Non-application of this Agreement

      particular signatories

19.11 Secretariat

19.12 Deposit

19.13 Registration

```

```
between

```

```
(iv) Agreement on Implementation of Article VII -(Customs

    Valuation)

    i.2(b)(iv) Transaction value

    11.1 Determination of customs value

    14 Application of Annexes (second sentence)

    18 Institutions (Committee on Customs Valuation)

    19 Consultation

    20 Dispute settlement

    21 Special and differential treatment of

           developing countries

    22 Acceptance and accession

    24 Entry into force

    25.1 National legislation

    26 Review

    27 Amendments

    28 Withdrawal

    29 Secretariat'

    30 Depos i t

    31 Registration

    Annex II Technical Committee on Customs Valuation

    Annex III Ad Hoc Panels

    Protocol to the Agreement on Implementation of Article

    VJ I (except I.7 and I.8; with necessary conforming

    introductory language)

```

```
                  - 19 
  (v) Agreement on Import Licensing Procedures

      1.4 General provisions (last sentence)

      2.2 Automatic import licensing (footnote 2)

      4 Institutions, consultation and dispute settlement

      5 Final provisions (except paragraph 2)

  (vi) Agreement on Implementation of Article VI (Antidumping

      Code )

      13 Developing Countries

      14 Committee on Ant¡-Dumping Practices

      15 Consultation, Conciliation and Dispute Settlement

      16 Final Provisions (except paragraphs 1 and 3)

   (vii) Arrangement Regarding Bovine Meat

  (viii) International Dairy Arrangement

   (ix) Agreement on Trade in Civil Aircraft

   (x) Declaration on Trade Measures Taken for Balance-of
      Payments Purposes.

(c) All other provisions in the GATT and Related Instruments which

   relate to:

   (i) governmental assistance to economic development and the

      treatment of developing countries, except for paragraphs

      (1) to (4) of the Decision of 28 November 1979 (L/4903)

      on Differential and more Favourable Treatment,

      Reciprocity and Fuller Participation, of Developing

      Countr ies-,

   (ii) the establishment or operation of specialist committees

      and other subsidiary institutions;

   (iii) signature, accession, entry into force, withdrawal,

      deposit and registration.

```

```
                    - 20 
   (d) All agreements, arrangements, decisions, understandings or

     other joint action pursuant to the provisions listed in sub
     paragraphs (a) to (c) above.

(2) Contracting Parties shall apply the provisions of the "Declaration

  on Trade Measures Taken for Balance-of-Payments Purposes" to

  measures taken by those Contracting Parties which are not parties

   to the GATT to the extent that that is practicable in the context

  of the other provisions of this Treaty.

(3) With respect to notifications required by the provisions made

   applicable by Article 29(2)(a):

   (a) Contracting Parties which are not parties to the GATT or a

     Related Instrument shall make their notifications to the

     Secretariat. The Secretariat shall circulate copies of the

     notifications to all Contracting Parties. Notifications to the

     Secretariat shall be in one of the authentic languages of this

     Treaty. The accompanying documents may be solely in the

     language of the Contracting Party;

   (b) such requirements shall not apply to Contracting Parties to

     this Treaty which are also parties to the GATT and Related

     Instruments, which contain their own notification requirements.

(4) Trade in nuclear materials may be governed by agreements referred

   to in the Declarations related to this paragraph contained in the

   Final Act of the European Energy Charter Conference.

```

```
                   - 21 
                  10. ANNEX TFU

    PROVISIONS FOR TRADE AGREEMENTS BETWEEN STATES WHICH WERE

 CONSTITUENT PARTS OF THE FORMER UNION OF SOVIET SOCIALIST REPUBLICS

          (In accordance with Article 29(2)(b))

(1) Any agreement described in Article 29(2)(b) shall be notified in

  writing to the Secretariat by or on behalf of all of the parties to

  such agreement which sign or accede to this Treaty:

  (a) in respect of an agreement in force as of a date three months

     after the date on which the first of such parties signs or

     deposits its instrument of accession to this Treaty, no later

     than six months after such date of signature or deposit; and

  (b) in respect of an agreement which enters into force on a date

     subsequent to the date referred to in sub-paragraph (a),

     sufficiently in advance of its entry into force for- other

     states or Regional Economic Integration Organizations which

     have signed or acceded to this Treaty (hereinafter referred to

     as the "Interested Parties") to have a reasonable opportunity

     to review the agreement and make representations concerning it

     to the parties thereto and to the Charter Conference prior to

     such entry into force.

(2) The notification shall include:

  (a) copies of the original texts of the agreement in all languages

     in which it has been signed;

  (b) a description, by reference to the i terns included in Annex EM,

     of the specific Energy Materials and Products to which it

     appI ies;

```

```
                   - 22 
  (c) an explanation, separately for each relevant provision of the

     GATT and Related Instruments made applicable by Article

     29(2)(a), of the circumstances which make it impossible or

     impracticable for the parties to the agreement to conform fully

     with that provision;

  (d) the specific measures to be adopted by each party to the

     agreement to address the circumstances referred to in sub
     paragraph (c); and

  (e) a description of the parties' programmes for achieving a

     progressive reduction and ultimate elimination of the

     agreement's non-conforming provisions.

(3) Parties to an agreement notified in accordance with paragraph (1)

  shall afford to the Interested Parties a reasonable opportunity to

  consult with them with respect to such agreement, and shall accord

  consideration to their representations. Upon the request of any of

  the Interested Parties, the agreement shall be considered by the

  Charter Conference, which may adopt recommendations with respect

  thereto.

(4) The Charter Conference shall periodically review the implementation

  of agreements notified pursuant to paragraph (1) and the progress

  having been made towards the elimination of provisions thereof that

  do not conform with provisions of the GATT and Related Instruments

  made applicable by Article 29(2)(a). Upon the request of any of the

   Interested Parties, the Charter Conference may adopt

  recommendations with respect to such an agreement.

(5) An agreement described in Article 29(2)(b) may in case of

  exceptional urgency be allowed to enter into force without the

  notification and consultation provided for in paragraphs (1Mb) to

   (3), provided that such notification takes place and the

  opportunity for such consultation is afforded promptly. In such a

  case the parties to the agreement shall nevertheless notify its

  text in accordance with paragraph (2)(a) promptly upon its entry

   into force.

```

```
                   - 23 
(6) Contracting Parties which are or become parties to an agreement

  described in Article 29(2)(b) undertake to limit the non
  conformities thereof with the provisions of the GATT and Related

  Instruments made applicable by Article 29(2)(a) to those necessary

  to address the particular circumstances and to implement such an

  agreement so as least to deviate from those provisions. They shall

  make every effort to take remedial action in light of

  representations from the Interested Parties and of any

  recommendations of the Charter Conference.

```

```
                     - 24 
                    11. ANNEX D

        INTERIM PROVISIONS FOR TRADE DISPUTE SETTLEMENT

            (In accordance with Article 29(7))

(1) (a) In their relations with one another, Contracting Parties shall

     make every effort through co-operation and consultations to

     arrive at a mutually satisfactory resolution of any dispute

     about existing measures that might materially affect compliance

     with the provisions applicable to trade under Article 5-or 29.

   (b) A Contracting Party may make a written request to any other

     Contracting Party for consultations regarding any existing

     measure of the other Contracting Party that it considers might

     affect materially compliance with provisions applicable to

     trade under Article 5 or 29. A Contracting Party which requests

     consultations shall to the fullest extent possible indicate the

     measure complained of and specify the provisions of Article 5

    • or of Article 29 and of the GATT and Related Instruments that

     it considers relevant. Requests to consult pursuant to this

     paragraph shall be notified to the Secretariat, which shall

     periodically inform the Contracting Parties of pending

     consultations that have been notified.

   (c) A Contracting Party shall treat any confidential or proprietary

      information identified as such and contained in or received in

     response to a written request, or received in the course of

     consultations, in the same manner in which it is treated by the

     Contracting Party providing the information.

   (d) In seeking to resolve matters considered by a Contracting Party

     to affect compliance with provisions applicable to trade under

     Article 5 or 29 as between itself and another Contracting

     Party, the Contracting Parties participating in consultations

     or other dispute settlement shall make every effort to avoid a

     resolution that adversely affects the trade of any other

     Contract ing Party.

```

```
                   - 25 
(2) (a) If, within 60 days from the receipt of the request for

     consultation referred to in paragraph (1)(b), the Contracting

     Parties have not resolved their dispute or agreed to resolve

     it by conciliation, mediation, arbitration or other method,

     either Contracting Party may deliver to the Secretariat a

     written request for the establishment of a panel in accordance

     with paragraphs (2)(b) to (f). In its request the requesting

     Contracting Party shall state the substance of the dispute and

     indicate which provisions of Article 5 or of A tide 29 and of

     the GATT and Related Instruments are considered relevant. The

     Secretariat shall promptly deliver copies of the request to all

     Contracting Parties.

  (b) The interests of other Contracting Parties shall be taken into

     account during the resolution of a dispute. Any other

     Contracting Party having a substantial interest (as defined in

     the GATT and Related Instruments) in a matter shall have the

     right to be heard by the panel and to make written submissions

     to it, provided that both the disputing Contracting Parties and

     the Secretariat have received written notice of its interest no

     later than the date of establishment of the panel, as

     determined in accordance with paragraph (2)(c).

   (c) A panel shall be deemed to be established 45 days after the

     receipt of the written request of a Contracting Party by the

     Secretariat pursuant to paragraph (2)(a).

   (d) A panel shall be composed of three members who shall be chosen

     by the Secretary-General from the roster described in paragraph

     (7). Except where the disputing Contracting Parties agree

     otherwise, the members of a panel shall not be citizens of

     Contracting Parties which either are party to the dispute or

     have notified their interest in accordance with paragraph

     (2)(b), or citizens of states members of a Regional Economic

     Integration Organization which either is party to the dispute

     or has notified its interest in accordance with

     paragraph (2)(b). •

```

```
                      26 
   (e) The disputing Contracting Parties shall respond within ten

     working days to the nominations of panel members and shall not

     oppose nominations except for compelling reasons.

   (f) Panel members shall serve in their individual capacities and

     shall neither seek nor take instruction from any government or

     other body. Each Contracting Party undertakes to respect these

     principles and not to seek to influence panel members in the

     performance of their tasks. Panel members shall be selected

     with a view to ensuring their independence, and that a

     sufficient diversity of backgrounds and breadth of experience

     are reflected in a panel.

   (g) The Secretariat shall promptly notify all Contracting Parties

     that a panel has been constituted.

(3) (a) The Charter Conference shall adopt rules of procedure for panel

     proceedings consistent with this Annex. Rules of procedure

     shall be as close as possible to those of the GATT and

     Related Instruments. A panel shall also have the right to adopt

     additional rules of procedure not inconsistent with the rules

     of procedure adopted by the Charter Conference or with this

     Annex. In a proceeding before a panel each disputing

     Contracting Party and any other Contracting Party which has

     notified its interest in accordance with paragraph (2)(b),

     shall have the right to at least one hearing before the panel

     and to provide a written submission. Disputing Contracting

     Parties shall also have the right to provide a written

     rebuttal. A Panel may grant a request by any other Contracting

     Party which has notified its interest in accordance with

     paragraph (2)(b) for access to any written submission made to

     the panel, with the consent of the Contracting Party which has

     made i t.

     The proceedings of a panel shall be confidential. A panel

     shall make an objective assessment of the matters before it,

     including the facts of the dispute and the compliance of

     measures with the provisions applicable to trade under

     Article 5 or 29. In exercising its functions, a panel shall

```

```
                     - 27

     consult with the disputing Contracting Parties and give them

     adequate opportunity to arrive at a mutually satisfactory

     solution. Unless otherwise agreed by the disputing Contracting

     Parties, a panel shall base its decision on the arguments and

     submissions of the disputing Contracting Parties. Panels shall

     be guided by the interpretations given to the GATT and Related

     Instruments within the framework of the GATT, and shall not

     question the compatibility with Article 5 or 29 of this Treaty

     of practices applied by any Contracting Party which is a party

     to the GATT to other parties to the GATT to which it applies

     the GATT and which have not been taken by those other parties

     to dispute resolution under the GATT.

     Unless otherwise agreed by the disputing Contracting Parties,

     all procedures involving a panel, including the issuance of its

     final report, should be completed within 180 days of the date

     of establishment of the panel; however, a failure to complete

     all procedures within this period shall not affect the validity

     of a final report.

   (b) A panel shall determine its jurisdiction; such determination

     shall be final and binding. Any objection by a disputing

     Contracting Party that a dispute is not within the jurisdiction

     of the panel shall be considered by the panel, which shall

     decide whether to deal with the objection as a preliminary

     question or to join, it to the merits of the dispute.

   (c) In the event of two or more requests for establishment of a

     panel in relation to disputes that are substantively similar,

     the Secretary-General may with the consent of all *the disputing

     Contracting Parties appoint a single panel.

(4) (a) After having considered rebuttal arguments, a panel shall

     submit to the disputing Contracting Parties the descriptive

     sections of its draft written report, including a statement of

     the facts and a summary of the arguments made by the disputing

     Contracting Parties. The disputing Contracting Parties shall be

     afforded an opportunity to submit written comments on the

     descriptive sections within a period set by the panel.

```

```
                  - 28 
  Following the date set for receipt of comments from the

  Contracting Parties, the panel shall issue to the disputing

  Contracting Parties an interim written report, including both

  the descriptive sections and the panel's proposed findings and

  conclusions. Within a period set by the panel a disputing

  Contracting Party may submit to the panel a written request

  that the panel review specific aspects of the interim report

  before issuing a final report. Before issuing a final report

   the panel may, in its discretion, meet with the disputing

  Contracting Parties to consider the issues raised in such a

   request.

  The final report shall include descriptive sections (including

  a statement of the facts and a summary of the arguments made by

   the disputing Contracting Parties), the panel's findings and

  conclusions, and a discussion of arguments made on specific

  aspects of the interim report at the stage of its review. The

   final report shall deal with every substantial issue raised

  before the panel and necessary to the resolution of the

  dispute and shall state the reasons for the panel's

  conclusions.

  A panel shall issue its final report by providing it promptly

   to the Secretariat and to the disputing Contracting Parties.

  The Secretariat shall at the earliest practicable opportunity

  distribute the final report, together with any written views

   that a disputing Contracting Party desires to have appended,

   to all Contracting Parties.

(b) Where a panel concludes that a measure introduced or maintained

   by a Contracting Party does not comply with a provision of

  Article 5 or 29 or with a provision of the GATT and Related

   Instruments that applies under Article 29, the panel may

   recommend in its final report that the Contracting Party alter

  or abandon the measure or conduct so as to be in compliance

  with that provision.

```

```
                     - 29

   (c) Panel reports shall be adopted by the Charter Conference. In

     order to provide sufficient time for the Charter Conference to

     consider panel reports, a report shall not be adopted by the

     Charter Conference until at least 30 days after it has been

     provided to all Contracting Parties by the Secretariat.

     Contracting Parties having objections to a panel report shall

     give written reasons for their objections to the Secretariat at

     least 10 days prior to the date on which the report is to be

     considered for adoption by the Charter Conference, and the

     Secretariat shall promptly provide them to all Contracting

     Parties. The disputing Contracting Parties and Contracting

     Parties which notified their interest in accordance with

     paragraph (2)(b) shall have the right to participate fully in

     the cons iderat ion of the panel report on that dispute by the

     Charter Conference, and their views shall be fully recorded.

   (d) In order to ensure effective resolution of disputes to the

     benefit of all Contracting Parties, prompt compliance with

     rulings and recommendations, of a final panel report that has

     been adopted by the Charter Conference is essential. A

     Contracting Party which is subject to a ruling or

     recommendation of a final panel report that has been adopted by

     the Charter Conference shall inform the Charter Conference of

     its intentions regarding compliance with such ruling or

     recommendation. In the event that immediate compliance is

     impracticable, the Contracting Party concerned shall explain

     its reasons for non-compliance to the Charter Conference and,

     in light of this explanation,'sha I I have a reasonable period of

     time to effect compliance. The aim of dispute resolution is the

     modification or removal of inconsistent measures.

(5) (a) "Where a Contracting Party has failed within a reasonable period

     of time to comply with a ruling or recommendation of a final

     panel report that has been adopted by the Charter Conference, a

     Contracting Party to the dispute injured by such non-compliance

     may deliver to the non-complying Contracting Party a written

     request that the non-complying Contracting Party enter into

     negotiations with a view to agreeing upon mutually acceptable

     compensation. If so requested the non-complying Contracting

     Party shall promptly enter into such negotiations.

```

```
                    - 30 
   (b) If the non-complying Contracting Party refuses to negotiate, or

     if the Contracting Parties have not reached agreement within

     30 days after delivery of the request for negotiations, the

     injured Contracting Party may make a written request for

     authorization of the Charter Conference to suspend obligations

     owed by it to the non-complying Contracting Party under Article

     5 or 29.

   (c) The Charter Conference may authorize the injured Contracting

     Party to suspend such of its obligations to the non-complying

     Contracting Party, under provisions of Article 5 or 29 or under

     provisions of the GATT and Related Instruments that apply under

     Article 29, as the injured Contracting Party considers

     equivalent in the circumstances.

   (d) The suspension of obligations shall be temporary and shall be

     applied only until such time as the measure found to be

     inconsistent with Article 5 or 29 has been removed, or until a

     mutually satisfactory solution is reached.

(6) (a) Before suspending such obligations the injured Contracting

     Party shall inform the non-complying Contracting Party of the

     nature and level of its proposed suspension. If the non
     complying Contracting Party delivers to the Secretary-General a

     written objection to the level of suspension of obligations

     proposed by the injured Contracting Party, the objection shall

     be referred to arbitration as provided below. The proposed

     suspension of obligations shall be stayed until the arbitration

     has been completed and the determination of the arbitral panel

     has become final and binding in accordance with paragraph

     (6)(e).

   (b) The Secretary-General shall establish an arbitral panel in

     accordance with paragraphs (2)(d) to (f), which if practicable

     shall be the same panel which made the ruling or recommendation

     referred to in paragraph (4)(d), to examine the level of

```

```
                      31 
     obligations that the injured Contracting Party proposes to

     suspend. Unless the Charter Conference decides otherwise the

     rules of procedure for panel proceedings shall be adopted in

     accordance with paragraph (3)(a).

  (c) The arbitral panel shall determine whether the level of

     obligations proposed to be suspended by the injured Contracting

     Party is excessive in relation to the injury it experienced,

     and if so, to what extent. It shall not revie-. the nature of

     the obligations suspended, except insofar as this is

     inseparable from the determination of the level of suspended

     obIigat ions.

   (d) The arbitral panel shall deliver its written determination to

     the injured and the non-complying Contracting Parties and to

     the Secretariat within 60 days of the establishment of the

     panel or within such other period as may be agreed by the

     injured and the non-complying Contracting Parties. The

     Secretariat shall present the determination to the Charter

     Conference at the earliest practicable opportunity, and no

     later than the meeting of the Charter Conference following

     receipt of the determination.

   (e) The determination of the arbitral panel shall become final and

     binding 30 days after the date of its presentation to the

     Charter Conference, and any level of suspension of benefits

     allowed thereby may thereupon be put into effect by the injured

     Contracting Party in such manner as that Contracting Party

     considers equivalent in the circumstances, unless prior to the

     expiration of the 30 days period the Charter Conference decides

     otherwise.

   (f) In suspending any obligations to a non-complying Contracting

     Party, an injured Contracting Party shall make every effort not

     to affect adversely the trade of any other Contracting Party.

(7) Each Contracting Party, may designate two individuals who shall, in

   the case of Contracting Parties which are also party to the,GATT,

   if they are willing and able to serve as panel-lists under this

```

```
                   - 32 
  Annex, be panellists currently nominated for the purpose of GATT

  dispute panels. The Secretary-General may also designate, with the

  approval of the Charter Conference, not more than ten individuals,

  who are willing and able to serve as panellists for purposes of

  dispute resolution in accordance with paragraphs (2) to (4). The

  Charter Conference may in addition decide to designate for the same

  purposes up to 20 individuals, who serve on dispute settlement

  rosters of other international bodies, who are willing and able to

  serve as panellists. The names of all of the individuals so

  designated shall constitute the dispute settlement roster.

   Individuals shall be designated strictly on the basis of

  objectivity, reliability and sound judgement and, to the greatest

  extent possible, shall have expertise in international trade and

  energy matters, in particular as relates to provisions applicable

  under Article 29. In fulfilling any function under this Annex,

  designees shall not be affiliated with or take instructions from

  any Contracting Party. Designees shall serve for renewable terms of

  five years and until their successors have been ' designated. A

  designee whose term expires shall continue to fulfil any function

  for which that individual has been chosen under this Annex. In the

  case of death, resignation or incapacity of a designee, the

  Contracting Party or the Secretary-General, whichever designated

  said designee, shall have the right to designate another individual

  to serve for the remainder of that designee's term, the designation

  by the Secretary-General being subject to approval of the Charter

  Conference.

(8) Notwithstanding the provisions contained in this Annex, Contracting

  Parties are encouraged to consult throughout the dispute resolution

  proceeding with a view to settling their dispute.

(9) The Charter Conference may appoint or designate other bodies or

  fora to perform any of the functions delegated in this Annex to

  the Secretariat and the Secretary-General.

```

```
                   - 33 
                   12. ANNEX B

          FORMULA FOR ALLOCATING CHARTER COSTS

           (In accordance with Article 37(3))

(1) Contributions payable by Contracting Parties shall be determined by

  the Secretariat annually on the basis of their percentage

  contributions required under the latest available United Nations

  Regular Budget Scale of Assessment (supplemented by information on

  theoretical contributions for any Contracting Parties which are not

  UN members).

(2) The contributions shall be adjusted as necessary to ensure that the

  total of all Contracting Parties' contributions is 100%.

```

```
               - 34 
              13. ANNEX PA

 LIST OF SIGNATORIES WHICH DO NOT ACCEPT THE PROVISIONAL

    APPLICATION OBLIGATION OF ARTICLE 45(3)(b)

      (In accordance with Article 45(3)(c))

1. The Czech Republic

2. Germany

3. Hungary

4. Lithuania

5. Poland

```

```
                 - 35 
                14. ANNEX T

    LIST OF CONTRACTING PARTIES* TRANSITIONAL MEASURES

         (In accordance with Article 32(1))

Provision P&ge Provision Pflfle

```

```
Article 6(2)

Article 6(5)

Article 7(4)

Article 9(1)

```

```
36 Article 10(7) 55

43 Article 14(1)(d) 56

49 Article 20(3) 58

52 Article 22(3) 63

```

```
List of Contracting Parties entitled to transitional arrangements

```

```
Albania

Armenia

Azerbaijan

Belarus

Bulgar ia

Croat i a

The Czech Republic

Estonia

Georgia

Hungary

Kazakhstan

Kyrgyzstan

```

```
Latvia

L ithuania

Moldova

Poland

Romania .

Russia

Slovak ia

Slovenia

Tadj ik istan

Turkmenistan

Ukraine

Uzbek istán

```

```
                   - 36 
                  ARTICLE 6(2)

"Each Contracting Party shall ensure that within its jurisdiction it
has and enforces such laws as are necessary and appropriate to address
unilateral and concerted anti-competiti ve conduct in Economic Activity
in the Energy Sector."

                COUNTRY : ALBANIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

There is no law on protection of competition in Albania. The law No
7746 of 28 July 1993 on Hydrocarbons and the law No 7796 of 17 February
1994 on Minerals do not include such provisions. There is no law on
electricity which is in the stage of preparation. This law is planned
to be submitted to the Parliament by the end of 1996.

In these laws Albania intends to include provisions on anti-competiti ve

conduct.

PHASE-OUT

1 January 1998.

                COUNTRY : ARMENIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

At present a state monopoly exists in Armenia in most energy sectors.
There is no law on protection of competition, thus the rules of
competition are not yet being implemented. There are no laws on energy.
The draft laws on energy are planned to be submitted to the Parliament
in 1994. The laws are envisaged to include provisions on anticompetitive behaviour, which would be harmonized with the EC
legislation on competition.

PHASE-OUT

31 December 1997.

```

```
                   - 37 
               COUNTRY : AZERBAIJAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The anti-monopoly legislation is at the stage of elaboration

PHASE OUT

1 January 2000.

                COUNTRY : BELARUS

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Anti-monopoly legislation is at the stage of elaboration.

PHASE-OUT

1 January 2000.

```

```
                   - 38 
                COUNTRY : GEORGIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat iona I .

DESCRIPTION

Laws on demonopolization are at present at the stage of elaboration in
Georgia and that is why the State has so far the monopoly for
practically all energy sources and energy resources, which restricts
the possibility of competition in the energy and fuel complex.

PHASE-OUT

1 January 1999.

               COUNTRY : KAZAKHSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The law on Development of Competition and Restriction of Monopolistic
Activities (No 656 of 11 June 1991) has been adopted, but is of a
general nature. It is necessary to develop the legislation further, in
particular by means of adopting relevant amendments or adopting a new

law.

PHASE-OUT

1 January 1998.

```

```
                     - 39 
                COUNTRY : KYRGYZSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI

DESCRIPTION

The law on Ant i-monopoly Policies has already been adopted. The
transitional period is needed to adapt provisions of this law to the
energy sector which is now strictly regulated by the state.

PHASE-OUT

1 July 2001.

                 COUNTRY : MOLDOVA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The law on Restriction of Monopolistic Activities and Development of
Competition of 29 January 1992 provides an organizational and legal
basis for the development of competition measures to prevent, limit and
restrict monopolistic activities; it is oriented towards implementing
market economy conditions. This law, however, does not provide for
concrete measures of anti-competiti ve conduct in the energy sector, nor
does it cover completely the requirements of Article 6.

In 1995 drafts of a law on Competition and a State Programme of
Demonopol ization of the Economy will be submitted to the Parliament.
The draft law on Energy which will be also submitted to the Parliament
in 1995 will cover issues on demonopol ization and development of

competition in the energy sector.

PHASE-OUT

1 January 1998.

```

```
                   - 40 
                COUNTRY : ROMANIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The rules of competition are not yet implemented in Romania. The draft
law on Protection of Competition has been submitted to the Parliament
and is scheduled to be adopted during 1994.

The draft contains provisions with respect to anti-competitive
behaviour, harmonized with the EC's law on Competition.

PHASE OUT

31 December 1996.

                 COUNTRY : RUSSIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

The Federat ion.

DESCRIPTION

A comprehensive framework of anti-monopoly legislation has been created
in the Russian Federation but other legal and organizational measures
to prevent, limit or suppress monopolistic activities and unfair
competition will have to be adopted and in particular in the energy

sector.

PHASE-OUT

1 July 2001.

```

```
                     - 41 
                 COUNTRY : SLOVENIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat iona I .

DESCRIPTION

Law on Protection of Competition adopted in 1993 arid published in
Official Journal No 18/93 treats anti-competitive conduct generally.
The existing law also provides for conditions for the establishment of
competition authorities. At present the main competition authority is
the Office of Protection of Competition in the Ministry of Economic
Relations and Development. With regard to importance of energy sector a
separate law in this respect is foreseen and thus more time for full
compliance is needed.

PHASE-OUT

1 January 1998.

                COUNTRY : TADJIKISTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

 In 1993 Tadjikistan passed the law on Demonopolization and Competition.

However, due to the difficult economic situation in Tadjikistan, the

jurisdiction of the law has been temporarily suspended.

PHASE-OUT

31 December 1997.

```

```
                    - 42 
               COUNTRY : TURKMENISTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

```

`Nat` `ionaI` _._

```
DESCRIPTION

Under the Ruling of the President of Turkmenistan No 1532 of 21.October
1993 the Committee on Restricting Monopolistic Activities has been
etablished and is acting now, the function of which is to protect
enterprises and other entities from monopoly conduct and practices and
to promote the formation of market principles on the basis of the
development of competition and entrepreneurship.

Further development of legislation and regulations is needed which
would regulate anti-monopoly conduct of enterprises in the Economic
Activity in the Energy Sector.

PHASE-OUT

1 July 2001.

               COUNTRY : UZBEKISTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The law on Restricting Monopoly Activities has been adopted in
Uzbekistan and has been in force since July 1992. However, the law (as
is specified in article 1, paragraph 3) does not extend to the
activities of enterprises in the energy sector.

PHASE-OUT

1 July 2001.

```

```
                     - 43 
                   ARTICLE 6(5)

"If a Contracting Party considers that any specified anti-competiti ve
conduct carried out within the Area of another Contracting Party is
adversely affecting an important interest relevant to the purposes
identified in this Article,the Contracting Party may notify the other
Contracting Party and may request that its competition authorities
initiate appropriate enforcement action. The notifying Contracting
Party shall include in such notification sufficient information to
permit the notified Contracting Party to identify the anti-competitive
conduct that is the subject of the notification and shall include an
offer of such further information and co-operation as that Contracting
Party is able to provide. The notified Contracting Party or, as the
case may be, the relevant competition authorities may consult with the
competition authorities of the notifying Contracting Party and shall
accord full consideration to the request of the notifying Contracting
Party in deciding whether or not to initiate enforcement action with
respect to the alleged anti-competitive conduct identified in the
notification. The not ified Contracting Party shall inform the notifying
Contracting Party of its decision or the decision of the relevant
competition authorities and may if it wishes inform the notifying
Contracting Party of the grounds for the decision. If enforcement
action is initiated, the notified Contracting Party shall advise the
notifying Contracting Party of its outcome and, to the extent possible,
of any significant interim development."

                  COUNTRY : ALBANIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

In Albania there are no established institutions to enforce the

competition rules. Such institutions will be provided for in the law on
the Protection of Competition which is planned to be finalized in 1996.

PHASE-OUT

1 January 1999.

```

```
                       44 
                COUNTRY : ARMENIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Institutions to enforce the provisions of this paragraph have not been

established in Armenia.

The laws on Energy and Protection of Competition are planned to include
provisions to establish such institutions.

PHASE-OUT

31 December 1997.

               COUNTRY : AZERBAIJAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Anti-monopoly authorities shall be established after the adoption of
ant i-monopoly legislation.

PHASE-OUT

1 January 2000.

```

```
                   - 45 
                COUNTRY : BELARUS

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Anti-monopoly authorities shall be established after the adoption of
ant¡-monopoly legislation.

PHASE-OUT

1 January 2000.

                COUNTRY : GEORGIA

SECTOR

All energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Laws on demonopol izat ion are at present at the stage of elaboration =i-n

Georgia and that is why there are no competition authorities

established yet.

PHASE-OUT

1 January 1999.

```

```
                    - 46 
               COUNTRY : KAZAKHSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

National.

DESCRIPTION

An Anti-monopoly Committee has been established in Kazakhstan, but its
activity needs improvement, both from legislative and organizational
points of view, in order to elaborate an effective mechanism handling
with the complaints on anti-competitive conduct.

PHASE-OUT

1 January 1998.

                COUNTRY : KYRGYZSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

There is no mechanism in kyrgyzstan to control the anti-competitive

conduct and the relevant legislation. It is necessary to establish

relevant ant i-monopoly authorities.

PHASE-OUT

1 July 2001.

```

```
                    - 47 
                COUNTRY : MOLDOVA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

National.

DESCRIPTION

The Ministry of Economy is responsible for the control of competitive

conduct in Moldova. Relevant amendments have been made to the law on

Breach of Administrative Rules, which envisage some penalties for
violating rules of competition by monopoly enterprises.

The draft law on Competition which is now at the stage of elaboration
will have provisions on the enforcement of competition rules.

PHASE-OUT

1 January 1998.

                COUNTRY : ROMANIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Institutions to enforce the provisions of this paragraph have not been

established in Romania.

The Institutions charged with the enforcement of competition rules are
provided for in the draft law on Protection of Competition which is
scheduled to be adopted during 1994.

The draft also provides a period of nine months for enforcement,
starting with the date of its publication.

```

```
                    - 48 
According to the Europe Agreement establishing an association between
Romania and the European Communities, Romania was granted a period of
five years to implement competition rules.

PHASE OUT

1 January 1998.

               COUNTRY : TADJIKISTAN

SECTOR

All energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Tadjikistan has adopted laws on Demonopolization and Competition, but
institutions to enforce competition rules are in the stage of
development.

PHASE-OUT

31 December 1997.

                COUNTRY : UZBEKISTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The law on Restricting Monopoly Activities has been adopted in
Uzbekistan and has been in force since July 1992. However, the law (as
is specified in article 1, paragraph 3) does not extend to the
activities of the enterprises in the energy sector.

PHASE-OUT

1 July 2001.

```

```
                   - 49 
                  ARTICLE 7(4)

"In the event that Transit of Energy Materials and Products cannot be
achieved on commercial terms by means of Energy Transport Facilities
the Contracting Parties shall not place obstacles in the way of new
capacity being established, except as may be otherwise provided in
applicable legislation which is consistent with paragraph (1)."

               COUNTRY : AZERBAIJAN

SECTOR

All energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

It is necessary to adopt a set of laws on energy, including licensing
procedures regulating transit. During a transition period it is
envisaged to build and modernize power transmission lines, as well as
generating capacities with the aim of bringing their technical level to
the world requirements and adjusting to conditions of a market economy.

PHASE OUT

31 December 1999.

                COUNTRY : BELARUS

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Laws on energy, land and other subjects are being worked out at
present, and until their final adoption, uncertainty remains as to the
conditions for establishing new transport capacities for energy
carriers in the territory of Belarus.

PHASE-OUT

31 December 1998.

```

```
                    - 50 
                COUNTRY : BULGARIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Bulgaria has no laws regulating Transit of Energy Materials and
Products. An overall restructuring is ongoing in the energy sector,
including development of institutional framework, legislation and
régulât ion.

PHASE-OUT

The transitional period of 7 years is necessary to bring the
legislation concerning the Transit of Energy Materials and Products in
full compliance with this provision.

1 July 2001.

                COUNTRY : GEORGIA'

SECTOR

All energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

It is necessary to prepare a set of laws on the matter. At present
there are substantially different conditions for the transport and
transit of various energy sources in Georgia (electric power, natural
gas, oil products, coal).

PHASE-OUT

1 January 1999.

```

```
                    - 51 
                 COUNTRY : HUNGARY

SECTOR

Electricity industry.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

According to the current legislation establishment and operation of
high-voltage transmission lines is a state monopoly.

The creation of the new legal and regulatory framework for
establishment, operation and ownership of high-voltage transmission
lines is under preparation.

The Ministry of Industry and Trade has already taken the initiative to
put forward a new Act on Electricity Power, that will have its impact
also on the Civil Code and on the Act on Concession. Compliance can be
achieved after entering in force of the new law on Electricity and
related regulatory decrees.

PHASE-OUT

31 December 1996'.

                 COUNTRY : POLAND

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

PoJish law on Energy, being in the final stage of co-ordination,
stipulates for creating new legal regulations similar to those applied
by free market countries (licenses to generate, transmit, distribute
and trade in energy carriers). Until it is adopted by the Parliament a
temporary suspension of obligations under this paragraph is required.

PHASE-OUT

31 December 1995.

```

```
                    - 52

                  ARTICLE 9(1)

"The Contracting Parties acknowledge the importance of open capital
markets in encouraging the flow of capital to finance trade in Energy
Materials and Products and for the making of and assisting with regard
to Investments in Economic Activity in the Energy Sector in the Areas
of other Contracting Parties, particularly those with economies in
transition. Each Contracting Party shall accordingly endeavour to
promote conditions for access to its capital market by companies and
nationals of other Contracting Parties, for the purpose of financing
trade in Energy Materials and Products and for the purpose of
Investment in Economic Activity in the Energy Sector in the Areas of
those other Contracting Parties, on a basis no less favourable than
that which it accords in like circumstances to its own companies and
nationals or companies and nationals of any other Contracting Party or
any third state, whichever is the most favourable."

                COUNTRY : AZERBAIJAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Relevant legislation is at the stage of elaboration

PHASE-OUT

1 January 2000.

```

```
                   - 53 
                COUNTRY : BELARUS

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat iona I.

DESCRIPTION

Relevant legislation is at the stage of elaboration.

PHASE-OUT

1 January 2000.

                COUNTRY : GEORGIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Relevant legislation is at the stage of preparation

PHASE-OUT

1 January 1997.

```

```
                    - 54 
                COUNTRY : KAZAKHSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The bill on Foreign Investments is in the stage of authorization
approval with the aim to adopt it by the Parliament in autumn 1994.

PHASE-OUT

1 July 2001.

                COUNTRY : KYRGYZSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Relevant legislation is currently under preparation.

PHASE-OUT

1 July 2001.

```

```
                     55 
           ARTICLE 10(7) - SPECIFIC MEASURES

"Each Contracting Party shall accord to Investments in its Area of
Investors of another Contracting Party, and their related activities
including management, maintenance, use, enjoyment or disposal,

treatment no less favourable than that which it accords to Investments

of its own Investors or of the Investors of any other Contracting Party
or any third state and their related activities including management,
maintenance, use, enjoyment or disposal, whichever is the most

favourable. "

                COUNTRY : BULGARIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Foreign persons may not acquire property right over land. A company
with more than fifty per cent of foreign person's share may not acquire
property right over agricultural land-,

Foreigners and foreign legal persons may not aquire property right over'
land except for as heritage according to the law. In this case they
have to make it over ;

A foreign person may aquire property right over buildings, but without
property right over the land;

Foreign persons or companies with foreign controlling participation
must obtain a permit before performing the following activities:

   exploration, development and extraction of natural resources from
   the terrritorial sea, continental shelf or exclusive economic zone;

   acquisition of real estate in geographic regions designated by the

   Council of Ministers.

   The permits are issued by the Council of Ministers or an authorized
   by the Council of Ministers body.

PHASE-OUT

1 July 2001. "

```

```
                     56 
                 ARTICLE 14(1)(d)

"Each Contracting Party shall with respect to Investments in its Area
of Investors of any other Contracting Party guarantee the freedom of
transfer into and out of its Area, including the transfer of:

unspent earnings and other remuneration of personnel engaged from
abroad in connection with that Investment;"

                COUNTRY : BULGARIA

SECTOR

All energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Foreign nationals employed by companies with more than 50 per cent of
foreign participation, or by a foreign person registered as sole trader
or a branch or a representative office of a foreign company in
Bulgaria, receiving their salary in Bulgarian leva, may purchase
foreign currency not' exeeding 70 per cent of their salary, including
social security payments.

PHASE-OUT

1 July 2001.

                COUNTRY : HUNGARY '

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

According to the Act on Investmetns of Foreigners in Hungary,
article 33, foreign top managers, executive managers, members of the
Supervisory Board and foreign employees may. transfer their income up to
50 per cent of their aftertax earnings derived from the company of
their employment through the bank of their company.

```

```
                     - 57 
PHASE-OUT

The phase out of this particular restriction depends on the progress
Hungary is able to make in the implementation of the foreign exchange
liberalization programme whose final target is the full convertibility
of the Forint. This restriction does not create barriers to foreign
investors. Phase-out is based on stipulations of Article 32.

1 July 2001.

```

```
                   - 58 
                 ARTICLE 20(3)

"Each Contracting Party shall designate one or more enquiry points to
which requests for information about the above mentioned laws,
regulations, judicial decisions and administrative rulings may be
addressed and shall communicate promptly such designation to the
Secretariat which shall make it available on request."

                COUNTRY : ALBANIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

In Albania there are no official enquiry points yet to which requests
for informant ion about the relevant laws and other regulations could be
addressed. There is no information center either. It is planned to
establish this center in 1994-1995. The relevant legislation will have
to be adopted to enable that.
Technical assistant is required.

PHASE-OUT

31 December 1996.

                COUNTRY : ARMENIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

In Armenia there are no official enquiry points yet to which requests
for information about the relevant laws and other regulations could be
addressed. There is no information centre either. There is a plan to
establish such a centre in 1994-1995. Technical assistance is required.

PHASE-OUT

31 December 1996.

```

```
                     - 59 
                COUNTRY : AZERBAIJAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

There are no official enquiry points so far in Azerbaijan to which
requests for information about relevant laws and régulât ions .could be
addressed. At present such information is concentrated in various
organizat ions.

PHASE OUT

31 December 1997.

                 COUNTRY : BELARUS

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Official enquiry offices which could give information on laws,
regulations, judicial decisions and administrative rulings do not exist
yet in Belarus. As far as the judical decisions and administrative
rulings are concerned there is no practice of their publishing.

PHASE-OUT

31 December 1998.

```

```
                - 60 
               COUNTRY : KAZAKHSTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

The process of establishing inquiry points has begun. As far as the
judicial decisions and administrâtive rulings are concerned they are
not published in Kazakhstan (except for some decisions made by the
Supreme Court), because they are not considered to be sources of law.
To change the existing practice will require long transitional period.

PHASE-OUT

1 July 2001.

                COUNTRY : MOLDOVA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

It is necessary to establish enquiry points.

PHASE-OUT

31 December 1995.

```

```
                     - 61 
                  COUNTRY : RUSSIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

The Federation and the Republics constituting Federation.

DESCRIPTION

No official enquiry points exist in the Russian Federation as of now to
which requests for information about relevant laws and other regulation
acts could be addressed. As far as the judicial decisions and
administrative rulings are concerned they are not considered to be

sources of law.

PHASE-OUT

31 December 2000.

                 COUNTRY : SLOVENIA

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

In Slovenia there are no official enquiry points yet to which requests
for information about relevant laws and other regulatory acts could be
addressed. At present such information is available in various
ministries. Law on Foreign Investments which is under preparation
foresees establishment of such an enquiry point.

PHASE-OUT

1 January 1998.

```

```
                  - 62 
               COUNTRY : TADJIKISTAN

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

There are no enquiry points yet in Tadjikistan to which requests for
information about relevant laws and other regulations could be
addressed. It is only a question of having available funding.

PHASE-OUT

31 December 1997.

                COUNTRY : UKRAINE

SECTOR

AI I energy sectors.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

Improvement of the present transparency of laws up to the level of
international practice is required. Ukraine will have to establish
enquiry points providing information about laws, regulations, judicial
decisions and administrative rulings and standards of general
appI icat ion.

PHASE-OUT

1 January 1998.

```

```
                   - 63 
                 ARTICLE 22(3)

"Each Contracting Party shall ensure that if it establishes or
maintains a state entity and entrusts the entity with regulatory,
administrative or other governmental authority, such entity shall
exercise that authority in a manner consistent with the Contracting
Party's obligations under this Treaty".

             COUNTRY: THE CZECH REPUBLIC

SECTOR

Uranium and nuclear industries.

LEVEL OF GOVERNMENT

Nat ionaI.

DESCRIPTION

In order to deplete uranium ore reserves that are stocked by
Administration of State Material Reserves, no imports of uranium ore
and concentrates, including uranium fuel bundles containing uranium of
non-Czech origin, will be licensed.

PHASE-OUT

1 July 2001.

```

```
                                14 September 1994

                                      ANNEX 2

                TEXT FOR ADOPTION

      DECISIONS WITH RESPECT TO THE ENERGY CHARTER TREATY

The Conference has adopted the following Decisions

1. With respect to Article 10(7)

  The Russian Federation may require that companies with foreign

  participation obtain legislative approval for the leasing of

  federally-owned property, provided that, the Russian Federation

  shall ensure without exception that this process is not applied in

  a manner which discriminates among Investments of Investors of

  other Contracting Parties.

2. With respect to Article 14*

   (1) The term "freedom . of transfer" in Article 14(1) does not

     preclude a Contracting Party (hereinafter referred to as the

     "Limiting Party") from applying restrictions on movement of

     capital by its own Investors, provided that:

     (a) such restrictions shall not impair the rights granted under

       Article 14(1) to Investors of other Contracting Parties

       with respect to their Investments;

   * See footnote to Decision No 2 on page 4

```

```
                  - 2 
   (b) such restrictions do not affect Current Transactions; and

   (c) the Contracting Party ensures that Investments in its Area

     of the Investors of all other Contracting Parties are

     accorded, with respect to transfers, treatment no less

     favourable than that which it accords to Investments of

     Investors of any other Contracting Party or of any third

     state, whichever is the most favourable.

(2) This Decision shall be subject to examination by the Charter

   Conference five years after entry into force of the Treaty, but

   not later than the date envisaged in Article 32(3).

(3) No Contracting Party shall be eligible to apply such

   restrictions unless, it has notified the provisional

   Secretariat in writing no later than 1 July 1995 that it elects

   to be eligible to apply restrictions in accordance with this

   Decision, and it is a Contracting Party which is a state that

   was a constituent part of the former Union of Soviet Socialist

   RepubIies.

(4) For the avoidance of doubt, nothing in this Decision shall

   derogate, as concerns Article 16, from the rights hereunder of

   a Contracting Party, its Investors or their Investments, or

   from the obligations of a Contracting Party.

(5) For the purposes of this Decision:

   "Current Transactions" are current payments connected with the

   movement of goods, services or persons that are made in

   accordance with normal international practice, and do not

   include arrangements which materially constitute a combination

   of a current payment and a capital transaction, such as

   deferrals of payments and advances which is meant to circumvent

   respective legislation of the Limiting Party in the field.

```

```
                     - 3 
3. With respect to Article 14(2)

   Without prejudice to the requirements of Article 14 and its other

   international obligations, Romania shall endeavour during the

   transition to full convertibility of its national currency to take

   appropriate steps to improve the efficiency of its procedures for

   the transfers of Investment Returns and shall in any case guarantee

   such transfers in a Freely Convertible Currency without restriction

   or a delay exceeding six months. Romania shall ensure that

   Investments in its Area of the Investors of all other Contracting

   Parties are accorded, with respect to transfers, treatment no less

   favourable than that which it accords to Investments of Investors

   of any other Contracting Party or of any third state, whichever is

   the most favourable.

4. With respect to Articles 24(4)(a) and 25

   An Investment of an Investor referred to in Article 1(7)(a)(ii), of

   a Contracting Party which is not party to an EIA or a member of a

   free-trade area or a customs union, shall be entitled to treatment

   accorded under such EIA, free-trade area or customs union, provided

   that the Investment

   (a) has its registered office, central administration or principal

     place of business in the Area of a party to that EIA or member

     of that free-trade area or customs union; or

   (b) in case it only has its registered office in that Area, has an

     effective and continuous link with the economy of one of the

     parties to that EIA or member of that free-trade area or

     customs union.

```

```
                   - 4 
Footnote to Decision No 2

* This Decision has been drafted in the understanding that

   Contracting Parties which intend to avail themselves of it and

   which also have entered into Partnership and Co-operation

   Agreements with the European Union and its member states

   containing an article disapplying those Agreements in favour of

   this Treaty, will exchange letters of understating which have

   the legal effect of making Article 16 of this Treaty applicable

   between them in relation to this Decision. The exchange of

   letters shall be completed in good time prior to signature.

```

**ISSN 0257-9545**

##### **COM (94) 405 final**

# **DOCUMENTOS**

#### **ES oí 12**

##### **N° de catálogo : CB-CO-94-426-ES-C** **ISBN 92-77-80761-X**

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