Law No. 38 Of 27 May 1996

Original Language Title:  LEGE nr. 38 din 27 mai 1996

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LAW No. 38 of 27 May 1996 ratification of the agreement between the Government and the Federal Government of the Federal Republic of Yugoslavia on mutual promotion and protection of investments, signed in Belgrade on November 28, 1995 published in PARLIAMENT ISSUING the OFFICIAL GAZETTE NR. 112 of 31 May 1996 the Romanian Parliament adopts this law.


The sole article Shall ratify the agreement between the Government and the Federal Government of the Federal Republic of Yugoslavia on mutual promotion and protection of investments, signed in Belgrade on November 28, 1995.
This law was adopted by the Senate at its meeting on 13 February 1996, in compliance with the provisions of art. 74 para. (2) of the Constitution of Romania.
p. SENATE CHAIRMAN ION SADANI this law was adopted by the Chamber of deputies at its meeting on 13 May 1996, in compliance with the provisions of art. 74 para. (2) of the Constitution of Romania.
PRESIDENT of the CHAMBER of DEPUTIES ADRIAN NASTASE ACCORD between the Government and the Federal Government of the Federal Republic of Yugoslavia on mutual promotion and protection of investments the Government of Romania and the Federal Government of the Federal Republic of Yugoslavia, hereinafter referred to as the Contracting Parties, desiring to intensify economic cooperation in the mutual benefit of their States, recognizing the need to promote and protect foreign investment in order to increase the economic prosperity of both countries agreed on as many as follows: Article 1 Definitions for the purposes of this agreement: 1. the term investment will designate any kind of asset invested by investors of one Contracting Party in the territory of the other Contracting Party, in accordance with the legislation of the latter, and shall include, in particular, but not limited to: (1) ownership of movable and immovable property and any other rights , such as mortgages, liens, pledges and other similar rights;
  

(2) any stocks, bonds or other securities, or any other form of participation in companies;
  

(3) rights or any other rights concerning the benefits that have an economic value;
  

(4) the intellectual property rights such as copyrights, patents, designs, trade marks or service trademarks, technical processes, know-how and goodwil and any other similar rights recognized by the laws of the Contracting Parties;
  

(5) the concessions under public law, including concessions concerning the exploration, extraction or exploitation of natural resources, as well as other rights conferred by law.
  

Any change in the form in which assets are invested or reinvested shall not affect their character as investments.
2. the term "investor will refer to: (1) any natural person, in accordance with the law of the Contracting Party, shall be deemed to be a citizen;
  

(2) any legal person, including companies, corporations, business associations and other organizations that are formed or otherwise organized, properly, in accordance with the law of that Contracting Party and which have their registered office on the territory of the same Contracting Party.
  

3. income Deadline will designate an investment product amounts and will include, in particular, but not limited to, loss of profits, dividends, interest, capital increases, fees, license fees and other similar fees, regardless of the form in which income is paid.
4. the term territory shall mean the territory of the Contracting Parties, including the territorial sea and the exclusive economic zone, to which the State concerned, in accordance with domestic law and international law, they exercise sovereignty, sovereign rights and jurisdiction.


Article 2 promotion, acceptance 1. Each Contracting Party shall promote investments carried out on its territory by investors of the other Contracting Party and shall admit such investments in accordance with its legislation.
2. Each Contracting Party shall protect its territory investments made in accordance with its legislation, by investors of the other Contracting Party and shall not take any discriminatory measure against these investments.


Article 3 Treatment of investments 1. Each Contracting Party shall ensure fair and just treatment in the territory of the other party or investments of investors of the contracting. This treatment will not be less favourable than that accorded by each Contracting Party in the territory of or investments of its own investors or than that accorded by each Contracting Party in the territory of or investments made by investors of any third State, whichever is the more favourable treatment.
2. the most-favoured-nation Treatment shall be construed as obliging a Contracting Party to extend to investors of the other Contracting Party and investment advantages resulting from any customs or economic Union, a free trade area or regional economic organization, at which any of the Contracting Parties is or becomes a member. This treatment will not refer either to the benefits that any Contracting Party shall provide the investors a third State by virtue of an agreement to avoid double taxation or other agreements on a reciprocal basis relating to taxes.


Article 4 Compensation 1. None of the parties will not, either directly or indirectly, measures of expropriation or any other measures of the same nature and of the same effect against investments of investors of the other Contracting Party, unless such measures are taken in the public interest, as determined by law, on a non-discriminatory basis and in accordance with legal procedure and provided they are taken through effective and adequate compensation. The amount of compensation shall be determined at the fair value of the investment immediately before the expropriation measure, and will be freely transferable without undue delay.
2. Investors of one Contracting Party whose investments in the territory of the other Contracting Party suffer losses due to war or other armed conflict, revolution, State of necessity or insurectiei, will be granted a treatment no less favourable than that accorded to investors of the other Contracting Party or wake than a third country investors in respect of the claims.


Article 5 Transfer 1. Each Contracting Party on whose territory the investment has been made by investors of the other Contracting Party will ensure that those investors, after payment of their tax obligations and other similar obligations, free transfer of payments in connection with these investments, in particular: (1) capital and additional required funds for maintenance and expansion of investment;
  

(2) income, in accordance with the provisions of art. 1. paragraph 3 of this agreement;
  

(3) amounts arising from the total or partial sale, liquidation of an investment gap times;
  

(4) the compensation referred to in article 1. 4 of this agreement.
  

2. Such transfers shall be made in convertible currency, without undue delay, in accordance with the law of the Contracting Party in whose territory the investment has been made, at the exchange rate applicable on the date of transfer.


Article 6 Subrogation 1. If any party or institution designated by it makes a payment to one of its investors on the basis of financial guarantees against non-commercial risks, granted in connection with an investment in the territory of the other Contracting Party, the latter will recognize, by virtue of the principle of subrogarii, assignment of any right or title of the first Contracting Party of the investor or the institution designated by the other Contracting Party it. you will be entitled to deduct taxes and other public obligations arising out and payable by the investor.
2. The transfer payments made in accordance with paragraph 1 of this article shall be governed also by the provisions of art. 4 and 5 of this agreement.


Article 7 Other privileges If national legislation of the Contracting Parties or an international agreement to which both parties are Contracting Parties grant investments or investors of the other Contracting Party to a treatment more favourable than that accorded under this agreement, this Agreement shall take precedence.


Article 8 settlement of the disputes between the Contracting Parties 1. Disputes between the Contracting Parties concerning the interpretation or application of the provisions of this Agreement shall be settled through diplomatic channels.
2. If the disputes referred to in paragraph 1 of this article cannot be solved amiably within a period of 6 months from the date on which a contracting party filed an application in writing, they will be subject to arbitration at the request of one of the Contracting Parties.
3. the arbitral Tribunal will be constituted ad hoc for each individual case. Each Contracting Party shall appoint an arbitrator and these two arbitrators shall choose, by mutual agreement, as President, a national of a third State. Referees will be appointed within two months from the date on which a party has notified the other Contracting Party of its intention to submit the dispute to arbitration.
The President will be appointed within a period of 3 months from that date.
4. If one of the parties has not appointed its own arbitrator and has not responded to the invitation to the other Contracting Party to make the appointment within two months, the arbitrator will be appointed by the President of the International Court of Justice at the request of this latter Contracting Party.

5. If both arbitrators cannot reach an agreement on electing the President within two months following their appointment, it will be called by the President of the International Court of Justice at the request of either Contracting Party.
6. If, in the cases referred to in paragraphs 4 and 5 of this article, the President of the International Court of Justice is prevented to fulfil its function if it is national of a Contracting Party, the appointment will be made by the Vice President, and if the latter is prevented, or if it is of one of the Contracting Parties, the appointment shall be made by the International Court of Justice judge with the largest function that is not of a Contracting Party.
7. the arbitral Tribunal will decide by majority vote and shall determine the procedure to be followed in its work.
8. The decisions of the arbitral tribunal shall be final and binding on both Contracting Parties.
9. Each Contracting Party shall bear the costs of the arbitrator that named him and its representation in the arbitral proceedings. The President's spending and other expenses shall be borne in equal parts by the Contracting Parties.


Article 9 settlement of the disputes between a Contracting Party and an investor of the other Contracting Party 1. For the purpose of resolving disputes relating to investments between a Contracting Party and an investor of the other Contracting Party, consultations shall be held between the parties concerned, in order to solve the case as amicable as possible.
2. If the consultations do not lead to a solution within six months from the date of application of the regulation, the investor may be subject to dispute, at his choice, to either: (1) the competent court of the Contracting Party in whose territory the investment has been carried out;
  

(2) the International Centre for the settlement of Disputes relating to Investments (I.C.S.I.D.), established by the Convention for the settlement of investment disputes between States and the people of other States, done at Washington on 18 March 1965;
  

(3) whether an ad hoc arbitration tribunal, which unless otherwise agreed between the parties to the dispute, will be constituted on the basis of the rules of arbitration of the United Nations Commission on International Trade Law (UNCITRAL).
  

3. A Contracting Party which is a party to the dispute will not invoke never during procedures concerning disputes relating to investments, like defense, his immunity or that the investor has received an indemnity under a contract of insurance covering all or part of the damage loss times.


Article 10 Consultations 1. Representatives of the two Contracting Parties will have meetings, when necessary, in order to: (1) analysing the application of this agreement;
  

(2) the exchange of information on legislation and investment opportunities;
  

(3) exchange of views with regard to disputes in relation to investments;
  

(4) submission of proposals for promoting investment;
  

(5) studying other issues related to investment.
  

2. Where either Contracting Party will request consultations regarding any of the matters referred to in paragraph 1 of this article, the other Contracting Party shall reply soonest possible, consultations will be held alternatively in Romania or in the Federal Republic of Yugoslavia.


Article 11 of the agreement this agreement's previous Investment will also apply to investments made in the territory of a Contracting Party, in accordance with its legislation, by investors of the other Contracting Party prior to the entry into force of this agreement, being applicable to such investments from the date of its entry into force. In consequence, the agreement will not apply to disputes that arose before its entry into force.


Article 12 entry into force This agreement shall be subject to ratification and shall enter into force upon the exchange of instruments of ratification.


Article 13 duration and expiry 1. This agreement shall remain in force for an initial period of 10 years. After expiry of the validity period, the agreement will continue to be in force automatically for successive periods of the next 5 years, unless terminated by submission, by either party, of a written notification six months before the expiry date.
2. For investments made prior to the date of expiry of this agreement, the provisions of art. 1-12 will continue to be effective for a future period of 10 years after the date of expiry of this agreement.
In witness whereof, the undersigned, being duly authorised thereto by the fully their respective Governments, have signed this agreement.
Done at Belgrade, on 28 November 1995, in two originals, each in the Romanian, Serbian and English languages, all texts being equally authentic. In case of any divergence of interpretation, the English text shall prevail.
For the Government of Romania, Teodor Viorel Mady, Minister of State, Minister of Foreign Affairs For the Federal Government of the Federal Republic of Yugoslavia, Jovan Zebici, Deputy Prime Minister, Minister of finance — — — — — — — — — — — — — —