VII
ing an investment. Other forms that an investment might take in- clude equity and debt interests in a company; contractual rights; tangible, intangible, and intellectual property; and rights conferred pursuant to law, such as licenses and permits. Investment as de- fined by the Treaty generally excludes claims arising solely from trade transactions, such as a sale of goods across a border that does not otherwise involve an investment. The Treaty defines ‘‘covered investment’’ as an investment of a national or company of a Party in the territory of the other Party. An investment of a national or company is one that the national or company owns or controls, either directly or indirectly. Indirect ownership or control could be through other, intermediate compa- nies or persons, including those of third countries. Control is not specifically defined in the Treaty; ownership of over 50 percent of the voting stock of a company would normally convey control, but in many cases the requirement could be satisfied by less than that proportion, or by other arrangements. The broad nature of the definitions of ‘‘investment,’’ ‘‘company,’’ and ‘‘company of a Party’’ means that investments can be covered by the Treaty even if ultimate control lies with non-Party nation- als. A Party may, however, deny the benefits of the Treaty in the limited circumstances described in Article XII. State Enterprise, Investment Authorization, Investment Agreement The Treaty defines ‘‘state enterprise’’ as a company owned, or controlled through ownership interests, by a Party. Purely regu- latory control over a company does not qualify it as a state enter- prise. The Treaty defines an ‘‘investment authorization’’ as an author- ization granted by the foreign investment authority of a Party to be covered investment or a national or company of the other Party. The Treaty defines an ‘‘investment agreement’’ as a written agreement between the national authorities of a Party and a cov- ered investment or a national or company of the other Party that (1) grants rights with respect to natural resources or other assets controlled by the national authorities and (2) the investment, na- tional, or company relies upon in establishing or acquiring a cov- ered investment. This definition thus excludes agreements with subnatural authorities (including U.S. States) as well as agree- ments arising from various types of regulatory activities of the na- tional government, including, in the tax area, rulings, closing agreements, and advance pricing agreements. ICSID Convention, Centre, UNCITRAL Arbitration Rules The ‘‘ICSID Convention,’’ ‘‘Centre,’’ and ‘‘UNCITRAL Arbitration Rules’’ are explicitly defined to make the text brief and clear. Article II (Treatment of Investment) Article II contains the Treaty’s major obligations with respect to the treatment of covered instruments. Paragraph 1 generally ensure the better of national or MFN treatment in both the entry and post-entry phases of investment. It thus prohibits, outside of exceptions listed in the Annex, ‘‘screen-
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