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Accepted by the resolution of Inter-parliamentary Assembly of the State Parties of the Commonwealth of Independent States

REFERRAL LEGAL ACT

of March 18, 1994

About the general principles of legal regulation of foreign investments in the State Parties of Inter-parliamentary Assembly

This referral legal act is intended for determination of general legal and economic basis of implementation of foreign investments and directed to creation of the equal economic conditions for mutual investment of the capitals into development of economy of the states of the Commonwealth unified and corresponding to world practice of conditions for attraction and effective use of foreign material, financial and technological resources and creations of the efficient mechanism of protection of the rights and interests of investors.

Article 1. Foreign investors

As foreign investors are considered:

- foreign legal entities, including, in particular, any companies, firms, the companies, the organizations or associations created and competent to perform investments according to the legislation of the country of the location;

- the foreign citizens, stateless persons, citizens of the host country having the permanent residence abroad provided that they are registered for conducting economic activity in the country of their nationality or the permanent residence;

- foreign states;

- international organizations.

Article 2. Foreign investments

Foreign investments are all types of property and the rights to them, and also the intellectual property rights put by foreign investors in objects entrepreneurial and other types of activity for the purpose of profit earning (income).

No change of form in which the investment of values is originally or repeatedly performed leads to change of their qualification as investment.

Article 3. Objects of foreign investments

Foreign investments can invest in any objects and types of activity which are not forbidden for such investments by the legislation.

By legal acts restrictions or prohibitions on implementation of foreign investments in the separate territories, and also concerning certain types of activity can be set.

Separate types of activity which are performed by foreign investors and the companies with foreign investments only based on special permission (license) can be determined by legal acts.

For the separate types of activity and the separate territories referred by the state to category priority privileges of tax, customs and other nature can be provided to foreign investors and the companies with foreign investments.

Article 4. Legal regime of foreign investments

Foreign investments use complete and unconditional legal protection of the national legal system and international treaties of the state. The legal regime of foreign investments, and also activities of foreign investors for their implementation cannot be less favorable, than the mode for property, property rights and investing activities of legal entities and citizens of the host country, behind withdrawals, stipulated by the legislation.

The national legal system is applied to all foreign investors and the companies with foreign investments without any discrimination.

Article 5. Guarantees from change of the legislation

If the subsequent legal acts of the state worsen investment conditions, the legislation existing at the time of implementation of investments is applied to foreign investments within at least ten years.

This provision does not extend to the changes of the legislation concerning ensuring defense, homeland security and public order, environmental protection, morality and health of the population.

Article 6. Guarantees from forced withdrawals

Foreign investments are not subject to nationalization and cannot be subjected to other measures, except as in the exclusive, provided by legal acts cases when these measures are taken in public concerns. In the specified cases bystry, adequate and effective compensation is paid to the foreign investor.

Compensation paid to the foreign investor shall correspond to the actual cost of the natsionaliziruyemy or confiscated investments directly till the moment when officially it became known of actually performed or forthcoming nationalization or requisition.

Transfer of the amounts of compensations abroad is made without collection of tax.

Article 7. Payment transfer guarantees in connection with foreign investments

The free translation abroad of investment incomes and other payments in connection with investments is guaranteed to foreign investors after payment of the corresponding taxes and fees.

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