European Energy Charter 6

European Energy Charter

 

ARTICLE 7

TRANSIT

(1) Each Contracting Party shall take the necessary measures to facilitate the
Transit of Energy Materials and Products consistent with the principle of
freedom of transit and without distinction as to the origin, destination or
ownership of such Energy Materials and Products or discrimination as to pricing
on the basis of such distinctions, and without imposing any unreasonable delays,
restrictions or charges.

(2) Contracting Parties shall encourage relevant entities to cooperate in:

(a) modernizing Energy Transport Facilities necessary to the Transit of
Energy Materials and Products;

(b) the development and operation of Energy Transport Facilities
serving the Areas of more than one Contracting Party;

(c) measures to mitigate the effects of interruptions in the supply of Energy
Materials and Products;

(d) facilitating the interconnection of Energy Transport Facilities.

(3) Each Contracting Party undertakes that its provisions relating to transport
of Energy Materials and Products and the use of Energy Transport Facilities
shall treat Energy Materials and Products in Transit in no less favourable a
manner than its provisions treat such materials and products originating in or
destined for its own Area, unless an existing international agreement provides
otherwise.

(4) In the event that Transit of Energy Materials and Products cannot be
achieved on commercial terms by means of Energy Transport Facilities the
Contracting Parties shall not place obstacles in the way of new capacity being
established, except as may be otherwise provided in applicable legislation which
is consistent with paragraph (1).

(5) A Contracting Party through whose Area Energy Materials and Products may
transit shall not be obliged to

(a) permit the construction or modification of Energy Transport Facilities;
or

(b) permit new or additional Transit through existing Energy Transport
Facilities,

which it demonstrates to the other Contracting Parties concerned would
endanger the security or efficiency of its energy systems, including the
security of supply.

Contracting Parties shall, subject to paragraphs (6) and (7), secure
established flows of Energy Materials and Products to, from or between the Areas
of other Contracting Parties.

(6) A Contracting Party through whose Area Energy Materials and Products transit
shall not, in the event of a dispute over any matter arising from that Transit,
interrupt or reduce, permit any entity subject to its control to interrupt or
reduce, or require any entity subject to its jurisdiction to interrupt or reduce
the existing flow of Energy Materials and Products prior to the conclusion of
the dispute resolution procedures set out in paragraph (7), except where this is
specifically provided for in a contract or other agreement governing such
Transit or permitted in accordance with the conciliator’s decision.

(7) The following provisions shall apply to a dispute described in paragraph
(6), but only following the exhaustion of all relevant contractual or other
dispute resolution remedies previously agreed between the Contracting Parties
party to the dispute or between any entity referred to in paragraph (6) and an
entity of another Contracting Party party to the dispute:

(a) A Contracting Party party to the dispute may refer it to the
Secretary-General by a notification summarizing the matters in dispute. The
Secretary-General shall notify all Contracting Parties of any such referral.

(b) Within 30 days of receipt of such a notification, the Secretary-General,
in consultation with the parties to the dispute and the other Contracting
Parties concerned, shall appoint a conciliator. Such a conciliator shall have
experience in the matters subject to dispute and shall not be a national or
citizen of or permanently resident in a party to the dispute or one of the other
Contracting Parties concerned.

(c) The conciliator shall seek the agreement of the parties to the dispute to
a resolution thereof or upon a procedure to achieve such resolution. If within
90 days of his appointment he has failed to secure such agreement, he shall
recommend a resolution to the dispute or a procedure to achieve such resolution
and shall decide the interim tariffs and other terms and conditions to be
observed for Transit from a date which he shall specify until the dispute is
resolved.

(d) The Contracting Parties undertake to observe and ensure that the entities
under their control or jurisdiction observe any interim decision under
subparagraph (c) on tariffs, terms and conditions for 12 months foilowing the
conciliator’s decision or until resolution of the dispute, whichever is earlier.

(e) Notwithstanding subparagraph (b) the Secretary-General may elect
not to appoint a conciliator if in his judgement the dispute concerns Transit
that is or has been the subject of the dispute resolution procedures set out in
subparagraphs (a) to (d) and those proceedings have not resulted in a resolution
of the dispute.

(f) The Charter Conference shall adopt standard provisions concerning the
conduct of conciliation and the compensation of conciliators.

(8) Nothing in this Article shall derogate from a Contracting Party’s rights and
obligations under international law including Customary International Law ,
existing bilateral or multilateral agreements, including rules concerning
submarine cables and pipelines.

(9) This Article shall not be so interpreted as to oblige any Contracting Party
which does not have a certain type of Energy Transport Facilities used for
Transit to take any measure under this Article with respect to that type of
Energy Transport Facilities. Such a Contracting Party is, however, obliged to
comply with paragraph (4). (10) For the purposes of this Article:

(a) “Transit”means

(i) the carriage through the Area of a Contracting Party, or to or from port
facilities in its Area for loading or unloading, of Energy Materials and
Products originating in the Area of another state and destined for the Area of a
third state, so long as either the other state or the third state is a
Contracting Party; or

(ii) the carriage through the Area of a Contracting Party of Energy Materials
and Products originating in the Area of another Contracting Party and destined
for the Area of that other Contracting Party, unless the two Contracting Parties
concerned decide otherwise and record their decision by a joint entry in Annex
N. The two Contracting Parties may delete their listing in Annex N by
delivering a joint written notification of their intentions to the Secretariat,
which shall transmit that notification to all other Contracting Parties. The
deletion shall take effect four weeks after such former notification.

(b) “Energy Transport Facilities”consist of high-pressure gas transmission
pipelines, high-voltage electricity transmission grids and lines, crude oil
transmission pipelines, coal slurry pipelines, oil product pipelines, and other
fixed facilities specifically for handling Energy Materials and Products.

ARTICLE 8

TRANSFER OF TECHNOLOGY

(1) The Contracting Parties agree to promote access to and transfer of energy
technology on a commercial and non-discriminatory basis to assist effective
trade in Energy Materials and Products and Investment and to implement the
objectives of the Charter subject to their laws and regulations, and to the
protection of Intellectual Property rights.

(2) Accordingly, to the extent necessary to give effect to paragraph (1) the
Contracting Parties shall eliminate existing and create no new obstacles to the
transfer of technology in the field of Energy Materials and Products and related
equipment and services, subject to non-proliferation and other international
obligations.

ARTICLE 9

ACCESS TO CAPITAL

(1) The Contracting Parties acknowledge the importance of open capital markets
in encouraging the flow of capital to finance trade in Energy Materials and
Products and for the making of and assisting with regard to Investments in
Economic Activity in the Energy Sector in the Areas of other Contracting
Parties, particularly those with economies in transition. Each Contracting
Party shall accordingly endeavour to promote conditions for access to its
capital market by companies and nationals of other Contracting Parties, for the
purpose of financing trade in Energy Materials and Products and for the purpose
of Investment in Economic Activity in the Energy Sector in the Areas of those
other Contracting Parties, on a basis no less favourable than that which
it accords in like circumstances to its own companies and nationals or
companies and nationals of any other Contracting Party or any third state,
whichever is the most favourable.

(2) A Contracting Party may adopt and maintain programmes providing for access
to public loans, grants, guarantees or insurance for facilitating trade or
investment aborad. It shall make such facilities available, consistent with the
objectives, constraints and criteria of such programmes (including any
objectives, constraints or criteria relating to the place of business of an
applicant for any such facility or the place of delivery of goods or services
supplied with the support of any such facility) for Investments in the Economic
Activity in the Energy Sector of other Contracting Parties or for financing
trade in Energy Materials and Products with other Contracting Parties.

(3) Contracting Parties shall, in implementing programmes in Economic Activity
in the Energy Sector to improve the economic stability and investment climates
of the Contracting Parties, seek as appropriate to encourage the operations and
take advantage of the expertise of relevant international financial
institutions.

(4) Nothing in this Article shall prevent:

(a) financial institutions from applying their own lending or underwriting
practices based on market principles and prudential considerations; or

(b) a Contracting Party from taking measures:

(i) for prudential reasons, including the protection of Investors, consumers,
depositors, policy-holders or persons to whom a fiduciary duty is owed by a
financial service supplier, or

(ii) to ensure the integrity and stability of its financial system and
capital markets.

 

Conclusion

Notes

See Also

References and Further Reading

About the Author/s and Reviewer/s

Author: international

Mentioned in these Entries

Customary International Law, European Energy Charter.


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