Transfers and Repatriation of Profits

By：Agreement on Investment Article 10th Update：2016-05-27

Each Party shall allow all transfers in respect of investments in its territory of an investor of any other Party to be made in any freely usable currency at the prevailing market rate of exchange on the date of transfer, and allow such transfers to be freely transferred into and out of its territory without delay.

Such transfers shall include:
(a) the initial capital, plus any additional capital used to maintain or expand the investments7;
(b) net profits, capital gains, dividends, royalties,licence fees, technical assistance and technical and management fees, interest and other current income accruing from any investment of the investors of any other Party;
(c) proceeds from the total or partial sale or liquidation of any investment made by investors of any other Party;
(d) funds in repayment of borrowings or loans given by investors of a Party to the investors of any other Party which the respective Parties have recognised as investment;
(e) net earnings and other compensations of natural persons of any other Party, who are employed and allowed to work in connection with an investment in its territory;
(f) payments made under a contract entered into by the investors of any other Party, or their investments including payments made pursuant to a loan transaction; and
(g)payments made pursuant to Article 8 (Expropriation) and Article 9 (Compensation for Losses).

Each Party undertakes to accord to the transfer referred to in Paragraph 1, treatment as favourable as that accorded, in like circumstances, to the transfer originating from investments made by investors of any other Party or third country.

Notwithstanding Paragraph 1 and Paragraph 2, a Party may prevent or delay a transfer through the equitable, non-discriminatory and good faith application of its laws and regulations relating to:
(a) bankruptcy, loss of ability or capacity to make payments, or protection of the right of creditors;
(b) non-fulfilment of the host Party’s transfer requirements in respect of trading or dealing in securities, futures, options or derivatives;
(c) non-fulfilment of tax obligations;
(d) criminal or penal offences and the recovery of the proceeds of crime;
(e) social security, public retirement or compulsory saving schemes;
(f) compliance with judgements in judicial or administrative proceedings;
(g) workers’ retrenchment benefits in relation to labour compensation relating to, amongst others, foreign investment projects that are closed down; and
(h) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities.

For greater certainty, the transfers referred to in the preceding Paragraphs shall comply with relevant formalities stipulated by the host Party’s domestic laws and regulations relating to exchange administration, insofar as such laws and regulations are not to be used as a means of avoiding a Party’s obligations under this Agreement.

Nothing in this Agreement shall affect the rights and obligations of the Parties as members of the IMF under the Articles of Agreement of the IMF, including the use of exchange actions which are in conformity with the Articles of Agreement of the IMF, provided that a Party shall not impose restrictions on any capital transactions inconsistently with its specific commitments under this Agreement regarding such transactions, except:
(a) under Article 11 (Measures to Safeguard the Balance of Payments); or
(b) at the request of the IMF; or
(c) where, in exceptional circumstances, movements of capital cause, or threaten to cause, serious economic or financial disturbance in the Party concerned, provided such restrictions do not affect the rights and obligations of the Parties as members of the WTO under Paragraph 1 of Article XI of GATS, and the measures are taken in accordance with paragraph 2 of Article 11 of this Agreement, mutatis mutandis.