* As with all the new reforms , the foreign investment policy of govt of India was also liberalised in 1991 .
* Negotiations undertaken with a number of countries to enter into Bilateral Investment Promotion & Protection Agreement (BIPAs) in order to promote and protect on reciprocal basis investment of the investors. Government of India have, so far, (as on July 2012) signed BIPAs with 82 countries out of which 72 BIPAs have already come into force and the remaining agreements are in the process of being enforced.
* BIPA applies to the investment made by an investor of one contracting party (the signing country) in the territory of the other. BIPA benefits can be claimed by an investor who could be a national of a signing country, or a legal person incorporated in that country. Further, investments is widely defined to include everything that one expects in a multinationals business movable or immovable property, shares and other securities, contractual rights, intellectual property rights, concessions for prospecting, research and exploitation of natural resources, and so on.
* The agreement provides that each contracting party shall promote in its territory investments by an investor of the other contracting party. Further, equitable treatment shall be provided to such investments. BIPA provides for National and Most Favoured Nation (MFN) treatment. Thus a contracting party should treat investors of the other party as favourably as it would treat its own, or investors of any other country. Similar treatment is required for the returns on the investments. This does not apply to benefits under certain obligations arising from other international agreements or regional cooperation agreements. Similarly, matters pertaining to taxation are excluded from National and MFN treatment
* A detailed mechanism is available for settlement of disputes the Arbitral Tribunal for disputes between the contracting parties; and the International Arbitration for disputes between an investor and a contracting party. Recently, Vodafone considered arbitration under BIPA for its tax dispute with Indian revenue authorities.
* FDI Vs BIPA Vs CEPA
BIPA post establishment investment whereas FDI pre establishment investment agreement
Therefore FDI not covered under BIPA.
CEPA Pre and Post establishment commitments
* As a result of a volatile economic or political environment or other reasons, investments by an investor of one country in another may be adversely affected. Recent instances include GMR losing an airport contract in Maldives, freezing bank accounts in Cyprus, and scrapping of telecom licences among others. It may be possible to get some protection in some cases and, accordingly, BIPA becomes relevant when investing in another country and thereafter. It is understood that recently Etihads investment in Jet Airways was kept on hold as BIPA between India and UAE was insisted upon.
( Now in mrunal bhai s style the boring part ,,,,,,,,,,,,,,,,,,,,,,,,,,, )
LIST OF COUNTRIES WITH WHOM BILATERAL INVESTMENT PROMOTION AND PROTECTION AGREEMENTS (BIPA) HAS BEEN SIGNED (AS ON JULY, 2012)
S.NCountryDate of AgreementDate of Enforcement
1.United Kingdom14th March 19946th January 1995
2.Russian Federation23rd December 19945th August 1996
3.Germany10th July 199513th July 1998
4.Malaysia3rd August 199512th April 1997
5.Denmark6th September 199528th August 1996
6.Turkmenistan20th September 199527th February 2006
7.Netherlands6th November 19951st December 1996
8.Italy23rd November 199526th March 1998
9.Tajikistan13th December 199523rd November 2003
10.Israel29th January 199618th February 1997
11.South Korea26th February 19967th May 1996
12.Poland7th October 199631st December 1997
13.Czech. Republic11th October 19966th February 1998
14.Kazakhstan9th December 199626th July 2001
15.Sri Lanka22nd January 199713th February 1998
16.Vietnam8th March 19971st December 1999
17.Oman2nd April 199713th October 2000
18.Switzerland4th April 199716th February 2000
19.Egypt9th April 199722nd November 2000
by Aruna S.
For an extended list visit http://finmin.nic.in/bipa/bipa_index.asp
References :
* http://finmin.nic.in/bipa/bipa_index.asp
* http://business.gov.in/legal_aspects/bipa.php
* http://www.thehindu.com/business/Industry/fdi-in-multibrand-retail-wont-take-away-right-of-states-centre/article3911785.ece
* I would like to say http://pib.nic.in ,but it involves tedious search , @ pib information is scattered here and there , like all govt websites.
