(Attachment)
Outline of Japan-Laos Investment Agreement
January 16, 2008
On the occasion of the Japan-Mekong Foreign Ministers' Meeting, H.E. Mr. Masahiko Koumura, Minister for Foreign Affairs of Japan, and H.E. Dr. Thongloun Sisoulith, Deputy Prime Minister and Minister of Foreign Affairs of Laos, signed an "Agreement between Japan and the Lao People's Democratic Republic for the Liberalisation, Promotion and Protection of Investment (Japan-Laos Investment Agreement)" in Tokyo on January 16, 2008.
The outline of the Agreement is as follows:
1. History
| Date | History |
|---|---|
| September 2006 | Japan and Laos held an intergovernmental meeting on the promotion of trade and investment. The two countries shared the intention to start negotiations on a bilateral investment agreement that covers the protection and broad liberalisation of investment. |
| December 2006 | Foreign Minister Taro Aso and Deputy Prime Minister Thongloun decided to start negotiations for the Japan-Laos Investment Agreement. |
| March 2007 | First Round Negotiation (in Vientiane) |
| April 2007 | Second Round Negotiation (in Vientiane) |
| November 2007 | Third Round Negotiation (in Vientiane) |
| January 2008 | Foreign Minister Koumura and Deputy Prime Minister Thongloun signed the Agreement. |
2. Meaning and Features of the Agreement
(1) Meaning
- To strengthen the economic relationship between Japan and Laos by promoting investment between the two countries, as a part of efforts to strengthen economic partnership between Japan and the East Asia region.
- To support the growth strategy of Laos that focus on economic development by promoting foreign direct investment.
(2) Features
- This Agreement stipulates not only the protection, but also the liberalisation of investment. For example, the Agreement (1) provides, in principle, national treatment and most-favoured-nation treatment which respect to pre-establishment phase of investments (Article 2 and Article 3); (2) obliges the Contracting Parties to abide by their contracts with investors (Article 5.2); and (3) prohibits, in principle, performance requirements that might hinder investment (Article 7).
- The Contracting Parties are obliged to abide by these provisions, except matters and sectors provided in the Annexes.
3. Outline of the Agreement
(1) Protection of Investors and Investments
National treatment (Article 2), most-favoured-nation treatment (Article 3), obligation to abide by contracts with investors (Article 5.2), prohibition of performance requirements (Article 7), expropriation and compensation (Article 12), protection from strife (Article 13), transfers (Article 15).
(2) Exceptions
General and security exceptions (Article 18), temporary safeguard measures (Article 19), prudential measures (Article 20).
(3) Dispute Settlements
Settlement of investment disputes between the Contracting Parties (Article 16), settlement of investment disputes between a Contracting Party and an investor of the other Contracting Party (Article 17), joint committee (Article 23).
(4) Others
Entry into force, termination, etc. (Article 27).
(5) Annexes
Reservations for non-conforming measures of each Contracting Party to national treatment (Article 2), most-favoured-nation treatment (Article 3) and the prohibition of performance requirements (Article 7).
4. Prospects
The Contracting Parties are to carry out the procedures required by domestic laws (including seeking Diet approval) to make the Agreement enter into force as soon as possible.
(Note: The Agreement will enter into force on the 30th day after the date of the exchange of diplomatic notes informing each other that their respective legal procedures necessary for the entry into force of this Agreement have been completed.)
Back to Index
