The Government of the Republic of Latvia and the
Government of the Republic of Moldova, hereinafter referred to
as the " Contracting Parties ",
DESIRING to intensify their economic co-operation to
the mutual benefit of both States on a long term
basis,
HAVING as their objectives to create favourable
conditions for investments by investors of either Contracting
Party in the territory of the other Contracting
Party,
RECOGNIZING that the promotion and protection of
investments, on the basis of this Agreement, will stimulate the
initiative in this field,
HAVE AGREED AS FOLLOWS:
Article 1
Definitions
For the purpose of this Agreement:
1. "Investment" means every kind of
asset, invested by an investor of one Contracting Party in the
territory of other Contracting Party, in accordance with the
law and regulations on the territory of Contracting Parties,
and in particular, though not exclusively, includes:
a) movable and immovable property including land
property and any other property rights such as mortgages, liens
or pledges;
b) shares in stock and debentures of a company and any
other form of participation in a company;
c) claims to money or to any performance under contract
having an economic value, as well as loans connected to an
investment;
d) intellectual and industrial property rights
including patents, trade marks, technical processes, know-how,
goodwill and any other similar rights;
e) business concessions conferred by law or under
contract, including concessions to search for cultivate,
extract or exploit natural resources;
f) goods that, under a leasing agreement, are placed at
the disposal of a lessee in the territory of a Contracting
Party, in conformity with its laws and regulations.
A possible change in the form in which the investments
have been made does not affect their character as
investments.
2. "Returns" means the amount, yielded
by an investment and in particular, though not exclusively,
includes profit, interest, capital gains, dividends, royalties
and fees.
3. "Investor" means with regard to
either Contracting Party:
a) natural persons having the nationality of that
Contracting Party in accordance with its law;
b) legal persons constituted or incorporated in
accordance with the law of Contracting Party.
4. "Territory" means:
a) in respect of the Republic of Latvia the territory
of the Republic of Latvia including the territorial sea, as
well as any maritime area beyond which Latvia in conformity
with international law, exercises sovereign rights with regard
to the seabed and subsoil and the natural resources of such
areas.
b) in respect of the Republic of Moldova,
"territory" means geographical space including the
soil and subsoil, waters and air stratum above the soil and the
territorial waters within the land boundaries, as well as
territorial waters upon which the Republic of Moldova exercises
its whole and exclusive sovereignty.
Article 2
Promotion and Protection of
Investments
1. Each Contracting Party promotes in its territory
investments by investors of the other Contracting Party and
admits such investments in accordance with its
legislation.
2. Investments by investors of a Contracting Party
shall, at all times, be accorded fair and equitable treatment
and shall enjoy full protection and security in the territory
of the other Contracting Party. Each Contracting Party shall
ensure that the management, maintenance, use, enjoyment or
disposal, in its territory, of investments by investors of the
other Contracting Party, is not in any way impaired by
unjustifiable or discriminatory measures.
3. Returns from the investments and, in cases of
reinvestment, the income ensuing therefrom, enjoy the same
protection as the initial investments.
4. Each Contracting Party shall observe any other
obligation it may have entered into with regard to investments
of investors of the other Contracting Party.
Article 3
Treatment of Investments
1. Each Contracting Party shall accord to investments,
made in its territory by investors of the other Contracting
Party, treatment not less favourable than that which it accords
to investments of its own investors or to investments of
investors of any third State, whichever is more
favourable.
2. Each Contracting Party shall accord to investors of
the other Contracting Party, as regards their activity in
connection with investments in its territory, treatment not
less favourable than that which it accords to its own investors
or to investors of any third State, whichever is more
favourable.
3. The provisions of paragraphs 1 and 2 of this Article
shall not be construed so as to oblige one Contracting Party to
extend to the investors of the other Contracting Party the
benefit of any treatment, preference or privilege resulting
from:
a) its participation in any existing or future customs
union, economic union, regional economic integration agreement
or similar international agreement, or
b) any international agreement or arrangement relating
wholly or mainly to taxation.
Article 4
Expropriation
1. Investments by investors of either Contracting Party
in the territory of the other Contracting Party, shall not be
expropriated, nationalised or subjected to any other measure
the effects of which would be tantamount to expropriation or
nationalisation (hereinafter referred to as
"expropriation"), except in the public interest,
under due process of law, on a non discriminatory basis and
against payment of prompt, adequate and effective compensation.
Such compensation shall amount to the market value of the
investment affected immediately before the actual measure was
taken or became public knowledge, whichever is the earlier, it
shall include interest from the date of expropriation until the
date of payment at a normal commercial rate and shall be freely
transferable in a freely convertible currency.
2. The provisions of paragraph 1 of this Article shall
also apply where a Contracting Party expropriates the assets of
a company which is constituted under the laws in force in any
part of its territory and in which investors of other
Contracting Party own shares.
3. The investor affected shall have a right, under the
law of the Contracting Party making the expropriation, to
prompt review, by a judicial or other independent authority of
that Party, of its case and of the valuation of its investment
in accordance with the principles set out in this
Article.
Article 5
Compensation for Losses
1. Investors of one Contracting Party whose investments
in the territory of the other Contracting Party suffer losses
owing to war or other armed conflict, a state of national
emergency, civil disturbance or other similar events in the
territory of the other Contracting Party shall be accorded by
the latter Contracting Party treatment, as regards restitution,
indemnification, compensation or other settlement, not less
favourable than that which the latter Contracting Party accords
to its own investors or to investors of any third State,
whichever is more favourable. Resulting payments shall be made
without delay and shall be freely transferable in a freely
convertible currency.
2. Without prejudice to paragraph 1 of this Article,
investors of one Contracting Party who, in any of the
situations referred to in that paragraph suffer losses in the
territory of the other Contracting Party resulting
from:
a) requisitioning of their investment or part thereof
by the latter's forces or authorities,
or
b) destruction of their 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.
3. Resulting payments shall be made without delay and
shall be freely transferable in a freely convertible
currency.
Article 6
Repatriation of Investments and
Returns
1. Each Contracting Party shall guarantee, in respect
of investments of investors of the other Contracting Party, the
unrestricted transfer of the investment and its
returns.
The transfers shall be effected without delay, in
national currencies of the Republic of Latvia and the Republic
of Moldova, and in other currencies in accordance of the laws
on the territory of Contracting Parties.
2. Such transfers shall include in particular, though
not exclusively:
a) capital and additional amounts to maintain or
increase the investment;
b) profits, interest, dividends and other current
income;
c) funds in repayment of loans;
d) royalties and fees;
e) earnings from sale or liquidation of the whole or
any part of the investment;
f) compensation under Articles 4 and 5;
g) earnings of natural persons subject to the laws and
regulations of that Contracting Party where investment have
been made.
Article 7
Subrogation
1. If the investments of an investor of one Contracting
Party in the territory of the other Contracting Party are
insured against non-commercial risks under a legal system of
guarantee, any subrogation of the insurer into the rights of
the said investor pursuant to the terms of such insurance shall
be recognised by the other Contracting Party, without prejudice
to the rights of the investor under Article 9 of this
Agreement.
2. The insurer shall not be entitled to exercise any
rights other than the rights which the investor would have been
entitled to exercise.
3. Disputes between a Contracting Party and the insurer
shall be tried to be remedied in accordance with the provisions
of Article 9 of this Agreement.
Article 8
Settlement of Disputes between the
Contracting Parties
1. Any dispute between the Contracting Parties
concerning the interpretation or application of this Agreement
shall, if possible, be settled by negotiations, through
diplomatic channels.
2. If the dispute cannot thus be settled within six
months from the beginning of the negotiations, it shall, upon
request of either Contracting Party be submitted to an
arbitration tribunal.
3. The arbitration tribunal shall be constituted ad hoc
as follows: Each Contracting Party shall appoint one arbitrator
and these two arbitrators shall agree upon a national of a
third State as chairman. The arbitrators shall be appointed
within three months, the chairman within five months from the
date on which either Contracting Party has informed the other
Contracting Party that it intends to submit the dispute to an
arbitration tribunal.
4. If within the period specified in paragraph 3 of
this Article the necessary appointments have not been made,
either Contracting Party may, in the absence of any other
agreement, invite the President of International Court of
Justice to make the necessary appointments. If the President of
the Court is a national of either Contracting Party or if he is
otherwise prevented from discharging the said function, the
Vice-President or if he too is a national of either Contracting
Party or is otherwise prevented from discharging the said
function the Member of the Court next in seniority, who is not
a national of either Contracting Party, shall be invited to
make the necessary appointments.
5. The arbitration tribunal shall decide on the basis
of respect of the law, including particularly this Agreement
and other relevant agreements between the Contracting Parties,
as well as the generally acknowledged rules and principles of
international law.
6. Unless the Contracting Parties decide otherwise, the
tribunal shall determine its own procedure.
The tribunal shall reach its decision by a majority of
votes. Such decision shall be final and binding on the
Contracting Parties.
7. Each Contracting Party shall bear the cost of the
arbitrator appointed by itself and of its representation. The
cost of the chairman as well as the other costs will be born in
equal parts by the Contracting Parties. The tribunal may,
however, in its direct decision that a higher proportion of
costs shall be born by one of the two Contracting Parties and
this award shall be binding on both Contracting
Parties.
Article 9
Settlement of Disputes between an
Investor and a Contracting Party
1. Disputes between an investor of a Contracting Party
and the other Contracting Party concerning an obligation of the
latter's under this Agreement, in relation to an investment
of the former, shall, if possible, be settled by the disputing
parties in an amicable way.
2. If such disputes cannot be settled within six months
from the date that either party requested amicable settlement,
the investor concerned may submit the dispute either to the
competent courts of the Contracting Party in the territory of
which the investment has been made or to international
arbitration.
Each Contracting Party hereby consents to the
submission of such dispute to international
arbitration.
3. Where the dispute is referred to international
arbitration the investor concerned may submit the dispute
either to:
a) the International Centre for the Settlement of
Investment Disputes, established under the convention on the
Settlement of Investment Disputes between States and Nationals
of Other States, opened for signature at Washington D. C. on 18
March 1965, for arbitration or conciliation, or
b) an ad hoc arbitrate tribunal to be established under
the arbitration rules of the United Nations Commission on
International Trade Law (UNCITRAL).
4. The arbitrate tribunal shall decide the disputes in
accordance with the provisions of this Agreement and the
applicable rules and principles of international law. The
awards of arbitration shall be final and binding on both
parties to the dispute. Each Contracting Party shall carry out
without delay any such award and such award shall be enforced
in accordance with domestic law.
5. During arbitration proceedings or the enforcement of
the award, the Contracting Party involved in the dispute shall
not raise the objection that the investor of the other
Contracting Party has received compensation under an insurance
contract in respect of all or part of the damage.
Article 10
Application of other Rules
If the provisions of law of either Contracting Party or
obligations under international law existing at present or
established hereafter between the Contracting Parties in
addition to this Agreement, contain a regulation, whether
general or specific, entitling investments by investors of the
other Contracting Party to treatment more favourable than is
provided for by this Agreement, such regulation shall, to
extent that is more favourable, prevail over this
Agreement.
Article 11
Consultations
Representatives of the Contracting Parties shall,
whenever necessary, hold consultations on any matter affecting
the implementation of this Agreement. These consultations shall
be held on the proposal of one of the Contracting Party at a
place and time to be agreed upon through diplomatic
channels.
Article 12
Application
This Agreement shall also apply to investments made
prior to its entry into force by investors of either
Contracting Party in the territory of the other Contracting
Party, in conformity with the legislation of the latter but
shall not apply to any dispute concerning an investment which
arose, or any claim which was settled before its entry into
force.
Article 13
Entry into Force - Duration -
Termination
1. This Agreement shall enter into force thirty days
after the date of last written notification, through diplomatic
channels, about the fulfilment by the Contracting Parties of
the requested internal procedures.
2. This Agreement is concluded for a period of 10
years. Its action shall remain in force for a further period of
10 years, if any Contracting Party will not notify the other
Contracting Party, through diplomatic channels, but not later
than one year before its expiration, about the intention of its
denunciation.
3. For the investments made prior to the expiration of
this Agreement, the previsions of this Agreement shall continue
to be effective for a period of ten years from the date of
investment.
Done in duplicate at Riga on September 22, 1999 in the
Latvian, Moldovan and English languages, all texts being
equally authentic.
In case of divergent interpretation, the English text
shall prevail.
| For the Government |
For the Government |
| of the Republic of
Latvia |
of the Republic of
Moldova |
