Common use of Principle of Subrogation Clause in Contracts

Principle of Subrogation. 1. In the event that a party has provided a financial guarantee for non-commercial risks in relation to an investment made by an investor of this Party in the territory of the other Party, the latter shall accept the application of the principle of subrogation of the first Party to the economic rights of the investor and not to the rights in rem, as soon as the first Party has made a payment from the guarantee provided. 2. This subrogation shall make it possible for the first party to be the direct beneficiary of all payments of compensation to which it might be entitled at the outset. In no case shall there be subrogation in rights of ownership, use, enjoyment or any other right in rem deriving from the ownership of the investment without first obtaining the appropriate authorisations in accordance with the laws on foreign investment in force in the Party where the investment was made.