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Exchange of Notes between the Government of Canada and the Government of Trinidad and Tobago constituting an Agreement relating to Canadian Investments in Trinidad and Tobago insured by the Government of Canada through its Agent the Export Development Corporation [1974] CATSer 4 (8 February 1974)

E101506 - CTS 1974 No. 7

EXCHANGE OF NOTES BETWEEN THE GOVERNMENT OF CANADA AND THE GOVERNMENT OF TRINIDAD AND TOBAGO CONSTITUTING AN AGREEMENT RELATING TO CANADIAN INVESTMENTS IN TRINIDAD AND TOBAGO INSURED BY THE GOVERNMENT OF CANADA THROUGH ITS AGENT THE EXPORT DEVELOPMENT CORPORATION

I

The High Commissioner of Canada to the Minister of External Affairs of Trinidad and Tobago

PORT OF SPAIN, February 8, 1974

His Excellency the Hon. Eric Williams,
Minister of External Affairs,
Trinidad and Tobago

Excellency,

I have the honour to refer to conversations which have recently taken place between the Government of Canada (the Insuring Government) and the Government of Trinidad and Tobago (the Host Government) with a view to promoting the development of economic relations between the two countries.

The particular facility under consideration has been foreign investment insurance by the Insuring Government, through its agent, the Export Development Corporation herein after called the “Insuring Agency”. The purpose of such facility is to promote investments in other countries by Canadian nationals whether individuals or corporations (including non-Canadian subsidiaries), by providing protection against specific risks to investments in projects approved by the Government of the Investment-receiving (host) country.

The specific risks against which the Insuring Agency offers protection are:

(a) war, riot, insurrection, revolution or rebellion;

(b) expropriation, confiscation or deprivation of any property right by a government or an agency thereof;

(c) inconvertibility of foreign exchange.

On the basis of the conversation held, I have the honour to confirm the understanding between the Government of Trinidad and Tobago and the Government of Canada as follows:

1. Subject to paragraph 2, when an investment suffers a loss by reason of a cause for which the Insuring Government has assumed the risks, the Host Government shall authorize the Insuring Agency to exercise the rights having devolved on it by law or having been assigned to it by the predecessor in title;

2. To the extent that the laws of the Host Country partially or wholly invalidate the acquisition by the Insuring Agency of any interests in any property within its national territory, the Host Government shall permit the investor and the Insuring Agency to make appropriate arrangements pursuant to which such interests are transferred to an entity permitted to own such interest under the laws of the Host Country;

3. The Insuring Agency shall assert no greater rights than those of the transferring investor under the laws of the Host Country with respect to any interest transferred or succeeded to as contemplated in paragraphs 1, and 2;

4. If the Insuring Agency makes payment to any investor under an insurance contract made pursuant to the present agreement, the Host Government shall, subject to the provisions of paragraph 2, recognize the transfer to the Insuring Agency of any currency, credits, assets, or investment on Account of which payment under such an insurance contract is made.

5. Should the Insuring Agency acquire amounts and credits of the lawful currency of the Host Country under investment insurance contracts, made pursuant to the present agreement, the Host Government shall accord to those funds treatment no different than that which it would accord if such funds were to remain with the investor; it shall make such amounts and credits freely available to the Government of Canada to meet its expenditures in the national territory of the Host Country.

6. Any dispute regarding the interpretation or application of the provisions of this Agreement or any claim against the Host Government to which the Insuring Agency may succeed as transferee or which may arise from the events causing payments under investment insurance shall, upon the request of either Government be the subject of negotiations between the Governments and shall be settled insofar as possible in such negotiations.

7. A dispute or claim shall be referred upon the initiative of either Government to a sole arbitrator selected by mutual agreement if:

(a) a request for negotiations made by one Government concerning a claim has not been agreed to by the other Government within three months of such a request having been made;

(b) after a period of six months from the date of commencement of negotiations concerning such claims a mutually satisfactory agreement has not been reached, nor have both Governments agreed to an extension to time for such negotiations.

8. If the two Governments are unable to select an arbitrator within a period of three months after indication by either Government of its desire to arbitrate, the President of the International Court of Justice shall, at the request of either Government designate the arbitrator.

9. I have the honour to propose that, if the foregoing is acceptable to your Government, this Note, which is authentic in English and French, and your reply to that effect shall constitute an agreement between our two Governments, which shall enter into force on the date of your reply. This agreement shall continue in force until terminated by either Government on six months notice in writing to the other. In the event of termination, the provisions of the agreement shall continue to apply in respect of insurance contracts issued while the agreement was in force for the duration of these contracts; provided that in no case shall the agreement continue to apply to such contracts for a period longer than fifteen years after termination of this agreement.

Accept, Excellency, renewed assurance of my highest consideration.

David C. Reece

II

The Minister of External Affairs of Trinidad and Tobago to the High Commissioner of Canada

February 8, 1974

His Excellency D. C. Reece,
High Commissioner of Canada,
Port of Spain

Excellency,

I acknowledge your letter of 8th February, 1974 regarding proposals for the Guarantees of Investment in Trinidad and Tobago by the Government of Canada which reads as follows:

“I have the honour to refer to conversations which have recently taken place between the Government of Canada (the Insuring Government) and the Government of Trinidad and Tobago (the Host Government) with a view to promoting the development of economic relations between the two countries.

The particular facility under consideration has been foreign investment insurance by the Insuring Government, through its agent, the Export Development Corporation herein after called the ‘Insuring Agency’. The purpose of such facility is to promote investments in other countries by Canadian nationals whether individuals or corporations (including non-Canadian subsidiaries), by providing protection against specific risks to investments in projects approved by the government of the investment-receiving (host) country.

The specific risks against which the Insuring Agency offers protection are:

(a) war, riot, insurrection, revolution or rebellion;

(b) expropriation, confiscation or deprivation of any property right by a government or an agency thereof;

(c) inconvertibility of foreign exchange.

On the basis of the conversations held, I have the honour to confirm the understanding between the Government of Trinidad and Tobago and the Government of Canada as follows:

1. Subject to paragraph 2, when an investment suffers a loss by reason of a cause for which the Insuring Government has assumed the risks, the Host Government shall authorize the Insuring Agency to exercise the rights having devolved on it by law or having been assigned to it by the predecessor in title;

2. To the extent that the laws of the Host Country partially or wholly invalidate the acquisition by the Insuring Agency of any interests in any property within its national territory, the Host Government shall permit the investor and the Insuring Agency to make appropriate arrangements pursuant to which such interests are transferred to an entity permitted to own such interests under the laws of the Host Country;

3. The Insuring Agency shall assert no greater rights than those of the transferring investor under the laws of the Host Country with respect to any interest transferred or succeeded to as contemplated in paragraphs 1, and 2;

4. If the Insuring Agency makes payment to any investor under an insurance contract made pursuant to the present agreement, the Host Government shall, subject to the provisions of paragraph 2, recognize the transfer to the Insuring Agency of any currency, credits, assets, or investment on Account of which payment under such an insurance contract is made.

5. Should the Insuring Agency acquire amounts and credits of the lawful currency of the Host Country under investment insurance contracts, made pursuant to the present agreement, the Host Government shall accord to those funds treatment no different than that which it would accord if such funds were to remain with the investor; it shall make such amounts and credits freely available to the Government of Canada to meet its expenditures in the national territory of the Host Country.

6. Any dispute regarding the interpretation or application of the provisions of this Agreement or any claim against the Host Government to which the Insuring Agency may succeed as transferee or which may arise from the events causing payments under investment insurance shall, upon the request of either Government be the subject of negotiations between the Governments and shall be settled insofar as possible in such negotiations.

7. A dispute or claim shall be referred upon the initiative of either Government to a sole arbitrator selected by mutual agreement if:

(a) a request for negotiations made by one Government concerning a claim has not been agreed to by the other Government within three months of such a request having been made;

(b) after a period of six months from the date of commencement of negotiations concerning such claims a mutually satisfactory agreement has not been reached, nor have both Governments agreed to an extension to time for such negotiations.

8. If the two Governments are unable to select an arbitrator within a period of three months after indication by either Government of its desire to arbitrate, the President of the International Court of Justice shall, at the request of either Government designate the arbitrator.

9. I have the honour to propose that, if the foregoing is acceptable to your Government, this Note, which is authentic in English and French, and your reply to that effect shall constitute an agreement between our two Governments, which shall enter into force on the date of your reply. This agreement shall continue in force until terminated by either Government on six months notice in writing to the other. In the event of termination, the provisions of the agreement shall continue to apply in respect of insurance contracts issued while the agreement was in force for the duration of these contracts; provided that in no case shall the agreement continue to apply to such contracts for a period longer than fifteen years after termination of this agreement.”

The Government of Trinidad and Tobago accepts the provisions put forward by the Government of Canada and agrees that this reply together with your letter under reference should constitute an Agreement between the Government of Trinidad and Tobago and the Government of Canada.

The Government of Trinidad and Tobago further agrees that:

(a) this Agreement should enter into force on the date of this letter; and

(b) the provisions of the present Agreement shall apply to all investment guarantees issued prior to the coming into force of the present Agreement in respect of activities approved by the Government of Trinidad and Tobago.

Accept, Excellency, the assurance of my highest consideration.

Eric Williams

Minister of External Affairs,
Trinidad and Tobago