Common use of Expropriation and Nationalisation Clause in Contracts

Expropriation and Nationalisation. 1 . A Contracting Party shall not take measure of expropriation or nationalization or other measures having a similar effect relating to any investments unless the measures are in the public interest, non discriminatory, in accordance with the law of the Contracting Party which has admitted the investment and against reasonable compensation. 2 . The compensation referred to in paragraph 1 of the Article shall be computed on the basis of the market value of the investment immediately before the measures became public knowledge. Where the market value cannot be readily ascertained, the compensation shall be determined in accordance with generally recognized principles of valuation and equitable principles taking into account the capital invested, depreciation, capital already repatriated, replacement value and other relevant factors. The compensation shall include interest at a reasonable rate from the date the measures were taken to the date of payment, shall be paid without undue delay, shall be freely convertible and shall be freely transferable between the territories of the Contracting Parties at the average of the daily exchange rates, determined on each of those days in accordance with the law of the Contracting Party which has admitted the investment, over the six months immediately prior to the taking of the measures.paragraph 1 of the Article shall be computed on the basis of the market value of the investment immediately before the measures became public knowledge. Where the market value cannot be readily ascertained, the compensation shall be determined in accordance with generally recognized principles of valuation and equitable principles taking into account the capital invested, depreciation, capital already repatriated, replacement value and other relevant factors. The compensation shall include interest at a reasonable rate from the date the measures were taken to the date of payment, shall be paid without undue delay, shall be freely convertible and shall be freely transferable between the territories of the Contracting Parties at the average of the daily exchange rates, determined on each of those days in accordance with the law of the Contracting Party which has admitted the investment, over the six months immediately prior to the taking of the measures.

Expropriation and Nationalisation. 1 1. A Contracting Neither Party shall not take measure of expropriate or nationalise a covered investment either directly or indirectly through measures equivalent to expropriation or nationalization or other measures having nationalisation (expropriation), except: (a) for a similar effect relating to any investments unless the measures are public purpose; (13) (b) in the public interesta non-discriminatory manner; (c) on payment of prompt, non discriminatory, adequate and effective compensation in accordance with the law paragraphs 2, 3 and 4; and (d) in accordance with due process of the Contracting Party which has admitted the investment and against reasonable compensationlaw. 2 2. The compensation referred Compensation shall: (a) be paid without delay; (b) be equivalent to in paragraph 1 of the Article shall be computed on the basis of the fair market value of the expropriated investment immediately before the measures became public knowledgeexpropriation took place (the date of expropriation); (c) not reflect any change in value occurring because the intended expropriation had become known earlier; and (d) be fully realisable and freely transferable. 3. Where If the fair market value cannot be readily ascertainedis denominated in a freely usable currency, the compensation paid shall be determined in accordance with generally recognized principles no less than the fair market value on the date of valuation and equitable principles taking into account the capital investedexpropriation, depreciation, capital already repatriated, replacement value and other relevant factors. The compensation shall include plus interest at a commercially reasonable rate for that currency, accrued from the date of expropriation until the measures were taken to date of payment. 4. If the fair market value is denominated in a currency that is not freely usable, the compensation paid, converted into the currency of payment at the market rate of exchange prevailing on the date of payment, shall be paid without undue delayno less than: (a) the fair market value on the date of expropriation, converted into a freely usable currency at the market rate of exchange prevailing on that date; plus (b) interest, at a commercially reasonable rate for that freely usable currency, accrued from the date of expropriation until the date of payment. 5. Notwithstanding paragraphs 1, 2, 3 and 4, any measure of expropriation relating to land, which shall be as defined in the existing domestic legislation of the expropriating Party on the date of entry into force of this Agreement, shall be freely convertible for a purpose and shall be freely transferable between the territories upon payment of the Contracting Parties at the average of the daily exchange rates, determined on each of those days compensation in accordance with the law of the Contracting Party which has admitted the investment, over the six months immediately prior aforesaid legislation and any subsequent amendments thereto relating to the taking amount of compensation where such amendments follow the measures.paragraph 1 of the Article shall be computed on the basis of general trends in the market value of the investment immediately before the measures became public knowledgeland. 6. Where the market value canThis Article shall not be readily ascertained, the compensation shall be determined in accordance with generally recognized principles of valuation and equitable principles taking into account the capital invested, depreciation, capital already repatriated, replacement value and other relevant factors. The compensation shall include interest at a reasonable rate from the date the measures were taken apply to the date issuance of payment, shall be paid without undue delay, shall be freely convertible and shall be freely transferable between the territories of the Contracting Parties at the average of the daily exchange rates, determined on each of those days compulsory licences granted in relation to intellectual property rights in accordance with the law of the Contracting Party which has admitted the investmentTRIPS Agreement, over the six months immediately prior or to the taking revocation, limitation or creation of intellectual property rights, to the measuresextent that the issuance, revocation, limitation or creation is consistent with the TRIPS Agreement. 7. For greater certainty, a Party's decision not to issue, renew or maintain a subsidy or grant, or decision to modify or reduce a subsidy or grant, (a) in the absence of any specific commitment under law or contract to issue, renew or maintain that subsidy or grant; or (b) in accordance with any terms or conditions attached to the issuance, renewal, modification, reduction and maintenance of that subsidy or grant; standing alone, does not constitute an expropriation.