The Gavernment of the Republic of China and the Govemment of the
Republic of the Marshall Islands, hereinafter "the Parties";
Desiring to create favorable conditions for greater economic co-
operation and investments on the basis of the principles of equ-
ality and mutual benefit; and Recognizing that the promotion and
reciprocal protection of such investments will be conducive to
the stimulation of individual business initiative and will incr-
ease prosperity in both States;
Have agreed as follows:

ARTICLE 1 Definitions
For the purposes of this Agreement:
(1) "investment"' means every kind of asset and in particular,
though not exclusively, incfudes :
(i) movable and immovable property as well as other rights su-
ch as mortgages, liens or pledges;
(ii) shares in and stock and debentures of a company and any o-
ther form of interest in a company;
(iii) claims to money, or to any performance under contract hav-
ing an economic value;
(iv) intellectual and industrial property rights, in particular
copyrights, patents, utility-model patents, registered de-
signs, trade-marks, trade-names,trade and business secrets
, technical processes and know-how, goodwill;
(v) rights or permits conferred by law or under contract, inc-
luding concessions to search for, cultivate, extract or e-
xploit natural resources;
The said tena "investment" shall refer to those investments
admitted in the territories of the Parties in accordance wi-
th relevant laws, regulations and administrative practices.
Any change in the form in which assets are invested does not
affect their character as investments.
(2) "returns" means the amounts yielded by an investment and in
particular, though not exclusively, includes profif interest
capital gains, dividends, royalties and fees;
(3) "investor" means any natural personwho is a national of eit-
her Party or a juristic person such as a corporation, firm
or associations incorporated or established under the law in
force of either Party.
(4) "territory" means the territory, including the territorial
seas and any maritime areas situated beyond the territorial
seas, of each Party over which its authorities exercise sov-
ereign right of jurisdiction according to relevant laws.

A]RTICLE 2
Promofion of lnvestments
(1) Each Party shall, subject to its laws and regulations in the
field of foreign investment, encourage investments in its t-
erritory by investors of the other Party, and, subject to i-
ts right to exercise powers conferred by its laws, shall ad-
mit such investment.
(2) Each Party shall grant, in accordance with its laws and reg-
ulations, the necessary permits in connection with. such in-
vestments and with the implementation of licensing agreemen-
ts and contracts for technical, commercial or administrative
assistance.

ARTICLE 3 Treatment of Investments
(1) Investments and returns of investors of either Party shall
at ail times be accorded fair and equitable treatment and s-
hall enjoy full protection in the territory of the other Pa-
rty. Neither Party shall in any way impair, by adopting unr-
easonable or discriminatory measures, the management, maint-
enance, use, enjoyment or disposal of investments in its te-
rritory of investors of the other Party.
(2) Each Party shall in its territory accord investments and re-
turns of investors of the other Party treatment not less fa-
vorable than treatment, which it accords to investments and
returns of investors of any third State.
(3) The provisions of paragraph (2) shall not be construed so as
to oblige one Party to extend to the investors of the other
Party the benefit of any treatment, preference or privilege
resulting from:
(a) any existing or future customs union, free trade area, com-
mon market, any similar international agreement or any int-
erim arrangement leading up to such customs union, free tr-
ade area, or common market to which either of the Parties
is or may become a party, or
(b) any international agreement or arrangement relating wholly
or mainly to taxation or any domestic legislation relating
wholly or mainly to taxation.
(4) If either Party accords special advantages to development f-
inance institutions with foreign participation and establis-
hed for the exclusive purpose of development assistance thr-
ough mainly nonprofit activities, that Party shall not be o-
bliged to accord such advantages to development finance ins-
titutions or other investors of the other Party.

ARTICLE 4 Compensation for Losses
(1) Investors of either Party whose investments in the territory
of the other Party suffer losses owing to war or other armed
conflict, revolution, a state of national emergency, revolt,
insurrection pr riot in the territory of the latter Party s-
hall be accorded by the latter Party treatment, as regards
restitution, indemnification, compensation or other settlem-
ent, not less favorable than that which the latter party ac-
cords to its nationals or investors of any third State.
(2) Without prejudice to paragraph (1) of this Article, investo-
rs of either Party who in any of the situations referred to
in that paragraph suffer losses in the territory of the oth-
er Party resulting from:
(a) requisitioning of their property by the forces or authorit-
ies of the latter Party,
(b) destruction of their property by the forces or authorities
of the latter Party, which was not caused in combat action
or was not required by the necessity of the situation, sha-
ll be accorded restitution or adequate compensation.

ARTICILE 5 Expropriation
(1) Investments of investors of either Party shall not be natio-
nalized, expropriated or subjected to measures having effec-
ts equivalent to nationalization or expropriation (hereinaf-
ter referred to as "expropriation") in the territory of the
other Party except in the public interest, under due process
of law, on a nondiscriminatory basis and against prompt, ad-
equate and effective compensation. Such compensation shall
amount to the market value of the investment expropriated i-
mmediately before the expropriation or before the impending
expropriation became public knowledge, whichever is earlier,
shall include interest at a normal commercial rate until the
date of payment, shall be made without delay, and be effect-
ively realizable.
(2) The investor affected thereby shall have a right, under the
law of either Party making the expropriation, to prompt rev-
iew, by judicial or other independent authorities of that P-
arty in accordance with the procedures established by the l-
aw of that Party, of his or its case and of the valuation of
his or its investment in accordance with the principles set
out in this Article.

ARTXCILE 6 Transfers of Investments and Returns
Each Party shall allow in accordance with its laws and regulati-
ons, investors of the other Party the free transfer of payments
relating to their investments and returns, induding compensation
paid pursuant to Articles 4 and 5. Unless otherwise agreed by t-
he investor, transfers shall be made at the rate of exchange ap-
plicable on the date of transfer subject to the exchange regula-
tions in force, transfers shall be effected without delay in any
convertible currency at the market rate of exchange applicable
on the date of transfer.

ARTI[CILE 7 Settlement of Disputes between an Investor and a P-
arty
(1) Disputes between an investor of either Party and the other
Party concerning an obligation of the latter under this Agr-
eement in relation to an investment of the former which have
not been amicably settled shall, after a period of three mo-
nths from written notification of a claim, be submitted to
international arbitration if the investor concerned so wish-
es.
(2) where the dispute is referred to international arbitration,
the investor and the party concerned in the dispute may agr-
ee to refer the dispute either to:
(a) the International Court of Arbitration of the International
Chamber of Commerce in accordance with its Arbitration Rul-
es; or
(b) an international arbitrator or ad hoc arbitration tribunal
to be appointed by a special agreement or established under
the Arbitration Rules of the United Nations Commission on
International Trade Law.
If after a period of three months from written notification of
the claim there is no agreement to one of the above alternative
procedures, the dispute shall at the request in writing of the
investor concerned be submitted to arbitration at the Internati-
onal Court of Arbitration of the International Chamber of Comme-
rce. The Parties to the dispute may agree in writing to modify
the rules applicable to the arbitration, The awrard shall be fi-
nal and binding on the parties to the dispute. Each Party under-
takes to enforce the awards.

ARTICLE 8 Disputes between the Parties
(1) Disputes between the Parties concerning the interpretation
or application of this Agreement shall, if possible, be ami-
cably settled through consultation.
(2) If a dispute between the Parties cannot thus be settled wit-
hin a period of six months, it shall upon the request of ei-
ther Party besubmitted to an arbitral tribunal.
(3) Such an arbitral tribunal shall be constituted for each ind-
ividual case in the following way. Within two months of the
receipt of the request for arbitration, each Party shall ap-
point one member of the tribunal. Those two members shall t-
hen select a national of a third State who on approval by t-
he Parties shall be appointed Chairman of the tribunal. The
Chairman shall be appointed within two months from the date
of appointment of the other two members.
(4) If within the periods specified in paragraph (3) of this ar-
ticle the necessary appointments have not been made, either
Party may, in the absence of any other agreement, invite the
Chairman of the International Court of Arbitration of the I-
nternational Chamber of Commerce to make any necessary appo-
intments. If the Chairman is a national of either Party or
if be is otherwise prevented from discharging the said func-
tion, the Vice-Chairman shall be invited to make the necess-
ary appointments. If the Vice-Chairman is a national of eit-
her Party or if he too is prevented from discharging the sa-
id function, the Member of the International Court of Arbit-
raition of the International Chamber of Commerce next in se-
niority who is not a national of either Party shall be invi-
ted to make the necessary appointments.
(5) The arbitral tribunal shall reach its award by a majority of
votes. Each Party shall bear the costs of its own member of
the tribunal and of its representation in the arbitral proc-
eedings; the costs of the Chairman and the remaining costs
shall be borne in equal parts by the Parties. The tribunal
may, however, in its award direct that a higher proportion
of this costs shall be borne by one of the two Parties. The
tribunal shall determine its Own procedure. This award shall
be final and binding on the Parties.

ARTICLE 9 Subrogation
If a Party or its designated agency makes a payment to its own
investor under a guarantee it has given in respect of an invest-
ment in the territory of the other Party, fhe latter Party shall
recognize the assignment, whether by law or by legal transaction
, to the former Party of all the rights and claims of the indem-
nified investor, and shall recognize that the former Party or i-
ts designated agency is entitled to exercise such rights and en-
force such claims by virtue of subrogaticn, to the same extent
as the Original investor.

ARTICLE 10 Application of Other Rules
(1) If the provisions of the law of either Patty or obligations
under international law existing at present or established
hereafter between the Parties in addition to the rules cont-
ained in this Agreement, whether general or specific, entit-
ling investments and returns of investors of the other Party
to treatment more favorable than those which provided hereu-
nder Agreement, such rules shall prevail.
(2) Each Party shall observe any obligation it may have entered
into with regard to investments of investors of the other P-
arty.

ARTICLE 11 Scope of the Agreement
This Agreement shall apply to all investments, whether made bef-
ore or after the date Of entry into force of this Agreement, but
shall not apply to any dispute, which arose before entry into f-
orce of this Agreement.

ARTICLE 12 Final Clauses
(1) This Agreement shall enter into farce on the date when the
Parties, by an exchange of notes through diplomatic channel,
notify each other that the respective domestic legal proces-
ses required for implementation of this Agreement have been
completed.
(2) This Agreement shall remain in force for a period of ten ye-
ars. Thereafter it shall continue in force until the expira-
tion of twelve months from the date on wnich either Party s-
hall have given written notice of termination to the other.
(3) In respect of investment made prior to the date when the no-
tice of termination becomes effective, the provisions of ar-
ticles 1 to 11 shall remain in force with respect to such i-
nvestment for a further period of twenty years from that day
.

IN WITNESS WHEREOF the undersigned, being duly authorized there-
to, have signed this Agreement.

Done at Majuro in duplicate in the English language on the first
day of the fifth month, One Thousand Nine Hundred and Ninety Ni-
ne.

For the Government of For the Government of
the Republic of China the Republic of the Marshall
Islands
Jason C. Hu Phillip Muller
Minister of Foreign Affairs Minister of Foreign Affairs & Tra
de
Republic of China Republic of the Marshall Islands