European Energy Charter 10

European Energy Charter

 

ARTICLE 20

TRANSPARENCY

(1) Laws, regulations, judicial decisions and administrative rulings of general
application which affect trade in Energy Materials and Products are, in
accordance with Article 29(2)(a), among the measures subject to the transparency
disciplines of the GATT and relevant Related Instruments.

(2) Laws, regulations, judicial decisions and administrative rulings of general
application made effective by any Contracting Party, and agreements in force
between Contracting Parties, which affect other matters covered by this Treaty
shall also be published promptly in such a manner as to enable Contracting
Parties and Investors to become acquainted with them. The provisions of this paragraph shall not require any Contracting Party to disclose confidential information which would impede law enforcement or otherwise be contrary to the public interest or would prejudice the legitimate commercial interests of any Investor.

(3) Each Contracting Party shall designate one or more enquiry points to which
requests for information about the above mentioned laws, regulations, judicial
decisions and administrative rulings may be addressed and shall communicate
promptly such designation to the Secretariat which shall make it available on
request.

ARTICLE 21

TAXATION

(1) Except as otherwise provided in this Article, nothing in this Treaty shall
create rights or impose obligations with respect to Taxation Measures of the
Contracting Parties. In the event of any inconsistency between this Article and
any other provision of the Treaty, this Article shall prevail to the extent of
the inconsistency.

(2) Article 7(3) shall apply to Taxation Measures other than those on income or
on capital, except that such provision shall not apply to:

(a) an advantage accorded by a Contracting Party pursuant to the tax
provisions of any convention, agreement or arrangement described in subparagraph
(7)(a)(ii); or (b) any Taxation Measure aimed at ensuring the effective collection of taxes,
except where the measure of a Contracting Party arbitrarily discriminates
against Energy Materials and Products originating in, or destined for the Area
of another Contracting Party or arbitrarily restricts benefits accorded under
Article 7(3).

(3) Article 10(2) and (7) shall apply to Taxation Measures of the Contracting
Parties other than those on income or on capital, except that such provisions
shall not apply to:

(a) impose most favoured nation obligations with respect to advantages
accorded by a Contracting Party pursuant to the tax provisions of any
convention, agreement or arrangement described in subparagraph (7)(a)(ii) or
resulting from membership of any Regional Economic Integration Organization; or

(b) any Taxation Measure aimed at ensuring the effective collection of taxes,
except where the measure arbitrarily discriminates against an Investor of
another Contracting Party or arbitrarily discriminates against an Investor of
another Contracting party or arbitrarily restricts benefits accorded under the
Investment provisions of this Treaty.

(4) Article 29(2) to (6) shall apply to Taxation Measures other than those on
income or on capital.

(5) (a) Article 13 shall apply to taxes.

(b) Whenever an issue arises under Article 13, to the extent it pertains to
whether a tax constitutes an expropriation or whether a tax alleged to
constitute an expropriation is discriminatory, the following provisions shall
apply:

(i) The Investor or the Contracting Party alleging expropriation shall refer
the issue of whether the tax is an expropriation or whether the tax is
discriminatory to the relevant Competent Tax Authority. Failing such referral
by the Investor or the Contracting Party, bodies called upon to settle disputes
pursuant to Article 26(2)(c) or 27(2) shall make a referral to the relevant
Competent Tax Authorities;

(ii) The Competent Tax Authorities shall, within a period of six months of
such referral, strive to resolve the issues so referred. Where
non-discrimination issues are concerned, the Competent Tax Authorities shall
apply the non-discrimination provisions of the relevant tax convention or, if
there is no non-discrimination provision in the relevant tax convention
applicable to the tax or no such tax convention is in force between the
Contracting Parties concerned, they shall apply the non-discrimination
principles under the Model Tax Convention on Income and Capital of the
Organization for Economic Cooperation and Development;

(iii) Bodies called upon to settle disputes pursuant to Article
26(2)(c) or 27(2) may take into account any conclusions arrived at by the
Competent Tax Authorities regarding whether the tax is an expropriation. Such
bodies shall take into account any conclusions arrived at within the six-month
period prescribed in subparagraph (b)(ii) by the Competent Tax Authorities
regarding whether the tax is discriminatory. Such bodies may also take into
account any conclusions arrived at by the Competent Tax Authorities after the
expiry of the six-month period;

(iv) Under no circumstances shall involvement of the Competent Tax
Authorities, beyond the end of the six-month period referred to in subparagraph
(b)(ii), lead to a delay of proceedings under Articles 26 and 27.

(6) For the avoidance of doubt, Article 14 shall not limit the right of a
Contracting Party to impose or collect a tax by withholding or other means.

(7) For the purposes of this Article:

(a) The term “Taxation Measure”includes:

(i) any provision relating to taxes of the domestic law of the Contracting
Party or of a political subdivision thereof or a local authority therein; and

(ii) any provision relating to taxes of any convention for the avoidance of
double taxation or of any other international agreement or arrangement by which
the Contracting Party is bound.

(b) There shall be regarded as taxes on income or on capital all taxes
imposed on total income, on total capital or on elements of income or of
capital, including taxes on gains from the alienation of property, taxes on
estates, inheritances and gifts, or substantially similar taxes, taxes on the
total amounts of wages or salaries paid by enterprises, as well as taxes on
capital appreciation.

(c) A “Competent Tax Authority” means the competent authority pursuant to a
double taxation agreement in force between the Contracting Parties or, when no
such agreement is in force, the minister or ministry responsible for taxes or
their authorized representatives.

(d) For the avoidance of doubt, the terms “tax provisions”and “taxes”do not
include customs duties.

ARTICLE 22

STATE AND PRIVILEGED ENTERPRISES

(1) Each Contracting Party shall ensure that any state enterprise which it
maintains or establishes shall conduct its activities in relation to the sale or
provision of goods and services in its Area in a manner consistent with the
Contracting Party’s obligations under Part III of this Treaty.

(2) No Contracting Party shall encourage or require such a state enterprise to
conduct its activities in its Area in a manner inconsistent with the Contracting
Party’s obligations under Other provisions of this Treaty.

(3) Each Contracting Party shall ensure that if it establishes or maintains an
entity and entrusts the entity with regulatory, administrative or other
governmental authority, such entity shall exercise that authority in a manner
consistent with the Contracting Party’s obligations under this Treaty. (4) No Contracting Party shall encourage or require any entity to which it
grants exclusive or special privileges to conduct its activities in its Area in
a manner inconsistent with the Contracting Party’s obligations under this
Treaty.

(5) For the purposes of this Article, “entity” includes any enterprise, agency
or other organization or individual.

ARTICLE 23

OBSERVANCE BY SUB-NATIONAL AUTHORITIES

(1) Each Contracting Party is fully responsible under this Treaty for the
observance of all provisions of the Treaty, and shall take such reasonable
measures as may be available to it to ensure such observance by regional and
local governments and authorities within its Area.

(2) The dispute settlement provisions in Parts II, IV and V of this Treaty may
be invoked in respect of measures affecting the observance of the Treaty by a
Contracting Party which have been taken by regional or local governments or
authorities within the Area of the Contracting Party.

 

Conclusion

Notes

See Also

References and Further Reading

About the Author/s and Reviewer/s

Author: international

Mentioned in these Entries

European Energy Charter, Other provisions.


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