The Kingdom of the Netherlands and the Republic of Chile, hereinafter referred to as the Contracting Parties,
Desiring to strengthen further the friendly relations between both countries, to extend and intensify the economic relations between them, with respect to investments by the nationals of one Contracting Party in the territory of the other Contracting Party, particularly with respect to the transfer of capital.
Recognising that agreement upon the treatment to be accorded to such foreign investments will stimulate the flow of capital and technology and the economic development of the Contracting Parties and that fair and equitable treatment of investment is desirable,
Article 1. Definitions [Treedt in werking op een nader te bepalen tijdstip]
For the purposes of this Agreement:
a) the term „investments” shall comprise every kind of asset or rights related to it, in particular though not exclusively:
(i) movable and immovable property as well as any other rights in rem in respect of every kind of asset;
(ii) rights derived from shares, bonds and other kinds of interests in companies and joint ventures;
(iii) title to money, to other assets or to any performance having an economic value;
(iv) intellectual and industrial property rights, including copyrights, industrial property rights, technical processes, goodwill and know-how;
(v) rights granted under public law or under contract, including rights to prospect, explore, extract and win natural resources.
b) the term „nationals” shall comprise with regard to either Contracting Party the following subjects which have made investments in the territory of the other Contracting Party in accordance with the present Agreement:
(i) natural persons having the nationality of that Contracting Party in accordance with its law;
(ii) without prejudice to the provisions of (iii) hereafter, legal persons constituted under the law of that Contracting Party and being domiciled, as well as having real economic activities, in the territory of that same Contracting Party;
(iii) legal persons constituted under the law of any country which are effectively controlled by natural persons of that Contracting Party or by legal persons being domiciled, as well as having real economic activities, in the territory of that Contracting Party.
(c) The term „territory” means:
the territory of the Contracting Party concerned and any area adjacent to the territorial sea which, under the laws of the Contracting Party concerned, and in accordance with international law, is the exclusive economic zone or continental shelf of the Contracting Party concerned, in which that Contracting Party exercises jurisdiction or sovereign rights.
Article 2. Promotion and Admission of Investments [Treedt in werking op een nader te bepalen tijdstip]
Either Contracting Party shall, within the framework of its laws and regulations and subject to its general policy in the field of foreign investments, promote economic cooperation through the protection in its territory of investments of nationals of the other Contracting Party. Subject to its right to exercise powers conferred by its laws or regulations, each Contracting Party shall admit such investments.
Article 3. Treatment of Investments [Treedt in werking op een nader te bepalen tijdstip]
1 Each Contracting Party shall ensure fair and equitable treatment to the investments of nationals of the other Contracting Party and shall not impair, by unreasonable or discriminatory measures, the operation, management, maintenance, use, enjoyment or disposal thereof by those nationals. Each Contracting Party shall accord to such investments full security and protection.
2 More particularly, each Contracting Party shall accord to such investments treatment which in any case shall not be less favourable than that accorded either to investments of its own nationals or to investments of nationals of any third State, whichever is more favourable to the national concerned.
3 If a Contracting Party has accorded special advantages to nationals of any third State by virtue of agreements establishing a free trade agreement, customs union, economic union, common market, monetary union, or similar institution, or on the basis of interim agreements leading to such unions or institutions, that Contracting Party shall not be obliged to accord such advantages to nationals of the other Contracting Party.
5 If the provisions of law of either Contracting Party or obligations under international law existing at present or established hereafter between the Contracting Parties in addition to the present Agreement contain a regulation, whether general or specific, entitling investments by nationals of the other Contracting Party to a treatment more favourable than is provided for by the present Agreement, such regulation shall, to the extent that it is more favourable, prevail over the present Agreement.
Article 4. Taxation [Treedt in werking op een nader te bepalen tijdstip]
With respect to taxes, fees, charges and to fiscal deductions and exemptions, each Contracting Party shall accord to nationals of the other Contracting Party who are engaged in any economic activity in its territory, treatment not less favourable than that accorded to its own nationals or to those of any third State, who are in the same circumstances, whichever is more favourable to the nationals concerned. For this purpose, however, there shall not be taken into account any special fiscal advantages accorded by that Party:
a) under an agreement for the avoidance of double taxation; or
b) by virtue of its participation in a customs union, economic union or similar institution; or
c) on the basis of reciprocity with a third State.
Article 5. Free Transfer [Treedt in werking op een nader te bepalen tijdstip]
Article 6. Expropriation and Indemnity [Treedt in werking op een nader te bepalen tijdstip]
Neither Contracting Party shall take any measures depriving, directly or indirectly, nationals of the other Contracting Party of their investments unless the following conditions are complied with:
a) the measures are taken in the public or national interest and under due process of law;
b) the measures are not discriminatory or contrary to any undertaking which the Contracting Party, which takes such measures, may have given;
c) the measures are accompanied by provision for the payment of just compensation. Such compensation shall represent the genuine value of the investments affected, shall include interest at a normal commercial rate from the date of expropriation until the date of payment and shall, in order to be effective for the claimants, be paid and made transferable, without delay, to the country designated by the claimants concerned and in any freely convertible currency accepted by the claimants.
Article 7. Compensation for Losses [Treedt in werking op een nader te bepalen tijdstip]
Nationals of each Contracting Party who suffer losses in respect of their investments in the territory of the other Contracting Party owing to war or other armed conflict, revolution, a state of national emergency, revolt, insurrection or riot shall be accorded by the latter Contracting Party treatment, as regards restitution, indemnification, compensation or other settlement, no less favourable than that which that Contracting Party accords to its own nationals or to nationals of any third State, whichever is more favourable to the nationals concerned.
Article 8. Subrogation [Treedt in werking op een nader te bepalen tijdstip]
1 If the investments of a national of one Contracting Party are insured against non-commercial risks under a system established by law, regulation or government contract, any subrogation of the insurer or re-insurer or Agency designated by the one Contracting Party into the rights of the said national pursuant to the terms of such insurance or under any other indemnity given, shall be recognised by the other Contracting Party.
2 Whereas a Contracting Party has made a payment to its national and by virtue of this, has assumed its rights and claims, that national shall not pursue those rights and claims against the other Contracting Party, unless under express authorization of the former Contracting Party.
Article 9. Settlement of Disputes Between a Contracting Party and a National of the Other Contracting Party [Treedt in werking op een nader te bepalen tijdstip]
1 Any legal dispute between one Contracting Party and a national of the other Contracting Party concerning an investment of the latter in the territory of the former shall, if possible, be settled amicably.
2 If such a dispute cannot be settled according to the provisions of paragraph 1 of this article within a period of three months from the date either party to the dispute requested amicable settlement, the dispute shall at the request of the national concerned be submitted either to the judicial procedures provided by the internal law of the Contracting Party in the territory of which the investment has been made, or to international arbitration.
3 If the difference has been submitted to the competent court of the Contracting Party in whose territory the investment was made, reference may only be made to the international tribunal within thirty days from the date on which notice of reply to the claim has been given, or if the competent court has failed to make a final decision on the matter in the term of eighteen months from the date on which notice of claim is given. However, each Contracting Party can offer a more favourable treatment.
4 In case the dispute is referred to international arbitration in accordance with the provisions of this Article, each Contracting Party hereby gives its consent to its submission to the International Centre for Settlement of Investment Disputes for settlement by arbitration under the Convention on the Settlement of Investment Disputes between States and Nationals of other States, opened for signature at Washington on 18 March 1965. A legal person which is a national of one Contracting Party and which before such a dispute arises is controlled by nationals of the other Contracting Party shall, in accordance with Article 25 (2) (b) of the Convention, for the purpose of the Convention be treated as a national of the other Contracting Party.
5 Neither Contracting Party shall give diplomatic protection, or bring an international claim, in respect of a dispute which one of its nationals and the other Contracting Party shall have consented to submit or shall have submitted to judicial procedures or arbitration under this Article, unless:
a) the former Contracting Party shall have failed to abide by and comply with the award rendered in such a dispute; or
b) the Secretary-General of the International Centre for Settlement of Investment Disputes, or an arbitral tribunal constituted by it, decides that the dispute is not within the jurisdiction of the Centre.
For the purpose of this paragraph, diplomatic protection shall not include informal diplomatic exchanges for the sole purpose of facilitating a settlement of the dispute.
Article 10. Scope of the Application [Treedt in werking op een nader te bepalen tijdstip]
The present Agreement shall apply to investments in the territory of one Contracting Party which are, whether before or after its entry into force, made by nationals of the other Contracting Party in accordance with its laws and regulations of the former Contracting Party, in force at the time the investments were made. It shall however, not be applicable to divergencies or disputes which have arisen prior to its entry into force or to disputes directly related to events which have occurred prior to its entry into force.
Article 11. Consultations [Treedt in werking op een nader te bepalen tijdstip]
Either Contracting Party may propose the other Party to consult on any matter concerning the interpretation or application of the Agreement. The latter Party shall accord sympathetic consideration to the proposal and shall afford adequate opportunity for such consultations.
Article 12. Settlement of Disputes Between Contracting Parties [Treedt in werking op een nader te bepalen tijdstip]
1 Any dispute between the Contracting Parties concerning the interpretation or application of the present Agreement, which cannot be settled within a reasonable lapse of time by means of diplomatic negotiations, shall, unless the Parties have otherwise agreed, be submitted, at the request of either Party, to an arbitral tribunal, composed of three members. Each Party shall appoint one arbitrator and the two arbitrators thus appointed shall together appoint a third arbitrator as their chairman and who shall be a national of a third country which has diplomatic relations with both Contracting Parties.
3 If the two arbitrators are unable to reach agreement, in the two months following their appointment, on the choice of the third arbitrator, either Party may invite the President of the International Court of Justice to make the necessary appointment.
4 If, in the cases provided for in the paragraphs (2) and (3) of this Article, the President of the International Court of Justice is prevented from discharging the said function or is a national of either Contracting Party, the Vice-President shall be invited to make the necessary appointments. If the Vice-President is prevented from discharging the said function or is a national of either Party the most senior member of the Court available who is not a national of either Party shall be invited to make the necessary appointments.
5 The tribunal shall decide on the basis of respect for the law the provisions of this Agreement, the principles of International law on this subject and the General Principles of Law as recognised by the Contracting Parties. Before the tribunal decides, it may at any stage of the proceedings propose to the Parties that the dispute be settled amicably. The foregoing provisions shall not prejudice the power of the tribunal to decide the dispute ex aequo et bono if the Parties so agree.
Article 13. Territorial Application [Treedt in werking op een nader te bepalen tijdstip]
As regards the Kingdom of the Netherlands, the present Agreement shall apply to the part of the Kingdom in Europe, to the Netherlands Antilles and to Aruba, unless the notification provided for in Article 14, paragraph (1) provides otherwise.
Article 14. Final Provisions [Treedt in werking op een nader te bepalen tijdstip]
IN WITNESS WHEREOF, the undersigned representatives, duly authorised thereto, have signed the present Agreement.
DONE in two originals at Santiago, on this thirtieth day of November one thousand nine hundred ninety eight, in the Spanish, Netherlands and English languages, the three texts being equally authentic. In case of difference of interpretation the English text will prevail.
For the Kingdom of the Netherlands:
(sd.) GERRIT YBEMA
For the Republic of Chile
(sd.) MARIANO FERNÁNDEZ AMUNÁTEGUI