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Joint Press Release with the Ministry of Foreign AffairsSigning of the Japan-Mozambique Investment Agreement

On June 1, 2013, the governments of Japan and the Republic of Mozambique signed the Agreement between the Government of Japan and the Government of the Republic of Mozambique for the Liberalization, Promotion and Protection of Investment (Japan-Mozambique Investment Agreement).

1. Purpose and effects of the Agreement

1) Investment protection and developing an investment environment

The Agreement stipulates rules for investment protection and development of an investment environment. Improving the legal stability of the investment environment in Mozambique is expected to encourage investment activities by Japan's enterprises in the country.

2) Strengthening the Japan-Mozambique relationship

Mozambique has abundant natural resources, including coal and natural gas, and recently it has been maintaining a high economic growth of average 7% per year. Japanese enterprises have been expanding their businesses in Mozambique, and also Japan and Mozambique have been maintaining a good relationship.

2. Key points of the Agreement

The Agreement includes the following provisions in order to improve the legal stability of the investment environment:

1) National treatment and most-favoured-nation treatment (including the pre-investment process for obtaining permission)

Theses provision guarantees investors of the contracting countries to enjoy national treatment and most-favored-nation treatment not only in the post-investment process but also in the pre-investment process for obtaining permission.

Notes:
*National treatment: an obligation under which a contracting country should treat an investor of the other contracting country and such investor's investments no less favorably than the contracting country's own investors and their investments

*Most-favored-nation treatment: an obligation under which a contracting country should treat an investor of another contracting country and such investor's investments no less favorably than investors of a third country and their investments

2) Extensive prohibition of the performance requirements

This provision prohibits the partner contracting country that an investor has invested in from requiring the other contracting country to provide the former with certain performance as a condition for such investor's investments and investment activities, including export restriction requirements, local-content requirements, and technology transfer requirements. Additionally, this provision prohibits a contracting country's interference in any technical license contracts, for the first time in investment agreements, responding to the request from the Japanese industry.

3) An obligation to observe any commitments made by the contracting countries with investors (known as "Umbrella Clause")

When an investment contract is cancelled without reasonable cause, investors may lodge a complaint due to violation of the Agreement against the counter parties with an international arbitration procedure.

4) Investment protection provisions, including compensation in expropriation, protection from disputes, and free transfers

5) Settlement of investment disputes between the contracting countries and investors

When an investor suffers damage from the partner contracting country that the investor has invested in due to such country's breaching of its obligation under the Agreement, the investor may submit a dispute with the country to an international arbitration procedure for settlement.

Reference 1: Background to the negotiations

In February 2012, then-Prime Minister Yoshihiko Noda and Prime Minister Aires Bonifácio Baptista Ali of Mozambique held a talk and they agreed to launch negotiations on an investment agreement between Japan and Mozambique. The first and second rounds of the negotiations were respectively held in August and December 2012 before the agreement was substantially concluded in April 2013.

Reference 2: Articles of Agreements are to be announced on the websites of the Ministry of Economy, Trade and Industry (METI) and the Ministry of Foreign Affairs (MOFA):

Release Date

June 1, 2013

Division in Charge

Information on the country and regions:
Middle East and Africa Division, Trade Policy Bureau
Information on the details of the Agreement:
Economic Partnership Division, Trade Policy Bureau

Related Information

Regional Affairs / Mozambique

 
Ministry of Economy, Trade and Industry
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