Common use of Prudential Measures Clause in Contracts

Prudential Measures. 1. Notwithstanding any other provision of this Chapter, a Party shall not be prevented from adopting or maintaining measures for prudential reasons, including for the protection of investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial services supplier, or to ensure the integrity and stability of the financial system.18 2. Nothing in this Chapter applies to non-discriminatory measures of general application taken in pursuit of monetary and related credit policies or exchange rate policies.19This paragraph shall not affect a Party’s obligations under Article 8.8 (Transfers). 3. Where an investor submits a claim to arbitration under Section B of this Chapter, and the disputing Party invokes paragraphs 1 and 2 of this Article, the investor-State tribunal established pursuant to Section B of this Chapter may not decide whether and to what extent it is a valid defence to the claim of the investor. It shall seek a report in writing from the Parties on this issue. The investor-State tribunal may not proceed pending receipt of such a report or of a decision of a State-State arbitral tribunal, should such a State-State arbitral tribunal be established. 4. Pursuant to a request for a report received in accordance with the above paragraph, the financial services authorities 20 of the Parties shall engage in consultations. If the financial services authorities of the Parties reach a joint decision on the issue of whether and to what extent the relevant paragraphs of this Article is a valid defence to the claim of the investor, they shall prepare a written report describing their joint decision. The report shall be transmitted to the investor-State tribunal, and shall be binding on the investor-State tribunal. 18 It is understood that the term “prudential reasons” includes the maintenance of the safety, soundness, integrity, or financial responsibility of individual financial institutions or the financial system, as well as the maintenance of the safety and financial and operational integrity of payment and clearing systems.

Prudential Measures. 1. Notwithstanding any other provision of this Chapter, a Party shall not be prevented from adopting or maintaining measures for prudential reasons, including for the protection of investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial services supplier, or to ensure the integrity and stability of the financial system.18 2. Nothing in this Chapter applies to non-discriminatory measures of general application taken in pursuit of monetary and related credit policies or exchange rate policies.19This paragraph shall not affect a Party’s obligations under Article 8.8 (Transfers). 3. Where an investor submits a claim to arbitration under Section B of this Chapter, and the disputing Party invokes paragraphs 1 and 2 of this Article, the investor-State tribunal established pursuant to Section B of this Chapter may not decide whether and to what extent it is a valid defence to the claim of the investor. It shall seek a report in writing from the Parties on this issue. The investor-State tribunal may not proceed pending receipt of such a report or of a decision of a State-State arbitral tribunal, should such a State-State arbitral tribunal be established. 4. Pursuant to a request for a report received in accordance with the above paragraph, the financial services authorities 20 authorities20 of the Parties shall engage in consultations. If the financial services authorities of the Parties reach a joint decision on the issue of whether and to what extent the relevant paragraphs of this Article is a valid defence to the claim of the investor, they shall prepare a written report describing their joint decision. The report shall be transmitted to the investor-State tribunal, and shall be binding on the investor-State tribunal. 5. If, after 120 days, the financial services authorities of the Parties are unable to reach a joint decision on the issue of whether and to what extent the relevant 18 It is understood that the term “prudential reasons” includes the maintenance of the safety, soundness, integrity, or financial responsibility of individual financial institutions or the financial system, as well as the maintenance of the safety and financial and operational integrity of payment and clearing systems.