Nature and objective

TheAPPRIare bilateral treaties on reciprocal containing measures and provisions to protect, in international law, the investments by investors of each State Party in the territory of another state party.

Its aim is to provide a stable environment conducive to investment that will reduce the political and legal uncertainty that sometimes affect the development of investment projects that typically face the company abroad.

The notion of political risk is a key element for the investor, in particular in those sectors that require significant investments. Signed mostly with countries notOECDits aim is, precisely to minimize the political risks and provide greater legal certainty the investor by the recognition by the two signatories, of certain obligations and guarantees the investments made in both directions. The coverage of protection afforded byAPPRIapplies to the phase of investment post-establecimiento, once it has been done in accordance with the legislation of the receiving country.

TheAPPRIconstitute, along with other measures of financial and fiscal Nature, a basic tool of the institutional action by the secretariat of state for trade in the context of the plans to support the internationalization of the spanish company.

Contents

Defined the material scope (definition of investment) and staff (definition of investor), reflecting the standards required for the treatment and protection that both states should comply with regard to investments in its territory by investors of another state. The provisions and clauses contained in a typicallyAPPRIare:

• fair and equitable treatment in accordance with international law
• full protection and security and the prohibition of unjustified and discriminatory measures
• non-discrimination: national treatment (TN) and most-favoured-nation (MFN). In general terms, with the exception of the privileges granted to third parties through processes of regional economic integration, of the conventions to avoid double taxation and fiscal legislation, the spanish investment will receive treatment no less favourable than the local investor or that of investors of a third country
• the actions of expropriation, nationalization or other, whose effects are similar to the expropriation may be taken only in a non-discriminatory, for reasons of public interest and through the payment of compensation prompt, adequate and effective

TNandMFNfor any compensation for losses in investment due to war, revolution or similar conflicts

• right to free transfer of capital, profits and other payments relating to investment
• to fulfil contractual obligations owed to the investor by the host state investment
• mechanisms to resolve, through international arbitration, any dispute that might arise:
  • between the two states parties to aAPPRIon the interpretation or application of the agreement and
  • between the investor and the receiving state of investment over the failure of the latter of the obligations contained in the agreement. Two are often the options of international arbitration offered the investor:
    • the ad hoc committee, in accordance with theRules of arbitration of the united nations commission on International trade law(UNCITRAL), and
    • the institutional, being also two possible modalities awards including most of the agreements,International chamber of commerce of Paris(ITC) andCentro Internacional de Arreglo de Diferencias Relativas a Inversiones con sede en Washington(ICSID).

Duration and termination

In theAPPRIsigned by Spain, made commonly used is to provide that, following the exchange of notifications between the two states to communicate the ratification of the agreement, it enters into force and sustained in force for an initial period of ten years, renewable for consecutive periods of two years unless it is reported by any of the two states with a notice of six months before the expiration date the validity period.

SomeAPPRIdepart from the renovation was made above and provide that, after the initial period of validity, the agreement shall remain in force indefinitely unless they denounce with advance notice of six months.

Additionally, allAPPRIcontain a “ remanencia clause ”, during the decade after the termination of the agreement, its provisions will be pursued to investments that have been made before the complaint.

Agreements

Updated to 18 june 2002

Reported agreements

Last modified 18 june 2002