The two Contracting Parties,
Desirous to expand and reinforce their economic cooperation by
intensifying the flow of investments between them;
Have concluded the following:

Article 1
For the purposes of this Memorandum of Understanding;
1 the term "Investment" means every kind of asset wholly owned
or controlled by an investor of a Contracting Party in the te-
rritory of the other Contracting Party, including, but not li-
mited to, any:
a) movable and immovable property as well as any other rights
in rem, such as mortgages, liens and pledges, usufructs and
similar rights;
b) shares, stocks and debentures of companies and other kinds
of rights or interests in companies;
c) claims to money such as loans or to any performance having
an economic value, associated with an investment;
d) intellectual property rights, including but not limited to
copyrights, patents, industrial designs, know-how, tradema-
rks, trade and business secrets, trade names, good-will;
any alteration of the form in which assets are invested sh-
all not affect their classification as investment;
2 the term "returns" means the amounts yielded by an Investment
in particular profit, dividends, royalties, capital gains or
any similar yields or payments;
3 the term "Investor" means in respect of both Parties;
a) any natural person, or company or other juridical person w-
ho is a national of either Party;
b) any governmental institutions or companies

Article 2
1 This Memorandum of Understanding shall apply to Investments -
made by Investors -which are approved by the host Contracting
Party.
2 This Memorandum of Understanding shall apply to all Investmen-
ts made before or after the coming into force of this Memoran-
dum of Understanding.

Article 3
1 Both Contracting Parties shall as far as possible encourage a-
nd create favourable conditions for Investments in accordance
with their respective general economic policies.
2 Investments approved under Article 2 of this Memorandum of Un-
derstanding shall be accorded fair and equitable treatment and
protection by both Contracting Parties in accordance with the-
ir respective legislation.

Article 4
Subject to Article 5 and 6, neither Contracting Party shall sub-
ject Investments approved in accordance with the provisions of
Article 2 of this Memorandum of Understanding to treatment less
favourable than that which it accords to investments or returns
to investors of any third party.

Article 5
1 The provisions of this Memorandum of Understanding shall not
relate to privileges granted by either Contracting Party to t-
he investors of a third party by virtue of its membership of,
or association with, a customs union, an economic union, a co-
mmon market, a free trade area or regional cooperation arrang-
ements.
2 The provisions of this Memorandum of Understanding shall not
apply for the purposes of taxation.

Article 6
Where any measure of expropriation is taken against the Investm-
ents of Investors approved under Article 2, the measures shall
be taken for a public benefit, on a non-discriminatory basis, a-
nd against compensation which shall be adequate, effectively re-
alizable, made without unreasonable delay.
Such compensation shall be equivalent to the value of the expro-
priated investment immediately before the expropriation and be
freely convertible and transferable.

Article 7
Where Investments of Investors approved under Article 2 suffer
losses owing to war, armed conflict, emergency, revolt or any s-
imilar event, they shall be accorded treatment, as regards rest-
itution, indemnification, compensation or other settlements, on
terms no less favourable than that which is accorded to any thi-
rd party investors.

Article 8
Investors of either Party shall be accorded free transfer on a
non-discriminatory basis, of their capital, earnings, and retur-
ns from any Investment approved under Article 2 of this Memoran-
dum of Understanding.

Article 9
In the event that either Contracting Party (or any authorized s-
tatutory body designated by it) as a result of an indemnity or
guarantee it has given in respect of an Investment approved und-
er Article 2 of this Memorandum of Understanding or any part th-
ereof makes payment to the Investors in respect of any of his c-
laims under this Memorandum of Understanding, the other Contrac-
ting Party acknowledges that the first Contracting Party (or any
authorized statutory body designated by it) is entitled by virt-
ue of subrogation to exercise the rights and assert the claims
of the Investors of the first Contracting Party. The subrogated
right or claim shall not be greater than the original right or
claim of the said Investor.

Article 10
Any dispute;
a) between an Investor and either Contracting Party in connecti-
on with an Investment approved under Article 2; or
b) between the Contracting Parties concerning the interpretation
or implementation of this Memorandum of Understanding shall
be settled amicably through negotiations between the parties
to the dispute within six months failing which shall be refe-
rred to arbitration on such terms and conditions as the part-
ies may agree. The award shall be binding and shall not be s-
ubject to any appeal or remedy.

Article 11
1 This Memorandum of Understanding shall enter into force on the
latter date in which the Contracting Parties notify each other
in writing that the official approval has been completed. It
shall remain in force for a period of ten years and shall con-
tinue in force thereafter unless, after the expiry of the ini-
tial period of nine years, either Contracting Party notifies
in writing the other Contracting Party of its intention to te-
rminate this Memorandum of Understanding. The notice of termi-
nation shall become effective one year after it has been rece-
ived by the other Contracting Party.
2 In respect of Investments made prior to the date when the not-
ice of termination of this Memorandum of Understanding becomes
effective, the provisions of Article 1 to 10 shall remain in
force for a further period of ten years from that date.
This Memorandum of Understanding is done in duplicate in the
Arabic, Chinese and English languages, all texts being equally
authentic. In case of divergence of interpretation, the Engli-
sh text shall prevail.,
Done at Taipei on the 4TH of Sha'ban, 1421H, corresponding to
31ST of October, 2000

For the Ministry of Economic For the Ministry of Finance
Affairs and National Economy



_______________________ _______________________
Steve Ruey-Long Chen Mohamed Hamad Al-Mady
Vice-Minister of Vice Chairman and
Economic Affairs Managing Director- Sabic