AIRLINK 58.74 Increased By ▲ 0.75 (1.29%)
BOP 6.20 Decreased By ▼ -0.02 (-0.32%)
CNERGY 3.95 Decreased By ▼ -0.10 (-2.47%)
DFML 16.08 Increased By ▲ 0.38 (2.42%)
DGKC 67.48 Decreased By ▼ -1.07 (-1.56%)
FCCL 17.59 Decreased By ▼ -0.16 (-0.9%)
FFBL 25.91 Increased By ▲ 0.16 (0.62%)
FFL 9.17 Decreased By ▼ -0.14 (-1.5%)
GGL 9.82 Increased By ▲ 0.08 (0.82%)
HBL 112.95 Increased By ▲ 1.15 (1.03%)
HUBC 114.99 Increased By ▲ 0.19 (0.17%)
HUMNL 6.58 Increased By ▲ 0.14 (2.17%)
KEL 4.20 Decreased By ▼ -0.10 (-2.33%)
KOSM 3.59 Increased By ▲ 0.01 (0.28%)
MLCF 37.35 Decreased By ▼ -0.05 (-0.13%)
OGDC 116.69 Decreased By ▼ -0.51 (-0.44%)
PAEL 22.74 Decreased By ▼ -0.16 (-0.7%)
PIAA 10.76 Decreased By ▼ -0.59 (-5.2%)
PIBTL 6.22 Increased By ▲ 0.55 (9.7%)
PPL 104.26 Decreased By ▼ -0.99 (-0.94%)
PRL 26.47 Decreased By ▼ -0.08 (-0.3%)
PTC 9.55 Decreased By ▼ -0.05 (-0.52%)
SEARL 52.00 Decreased By ▼ -1.34 (-2.51%)
SNGP 65.15 Increased By ▲ 0.16 (0.25%)
SSGC 10.93 Decreased By ▼ -0.01 (-0.09%)
TELE 7.26 Increased By ▲ 0.10 (1.4%)
TPLP 11.97 Increased By ▲ 0.10 (0.84%)
TRG 77.22 Increased By ▲ 4.51 (6.2%)
UNITY 20.44 Decreased By ▼ -0.29 (-1.4%)
WTL 1.29 Decreased By ▼ -0.02 (-1.53%)
BR100 6,332 Increased By 45.7 (0.73%)
BR30 21,614 Increased By 27.8 (0.13%)
KSE100 61,914 Increased By 355.2 (0.58%)
KSE30 20,851 Increased By 132.3 (0.64%)

ISLAMABAD: A Pakistani delegation led by caretaker Minister for Commerce and Industries, Gohar Ijaz has finalised the Free Trade Agreement (FTA) including the template of the Bilateral Investment Treaty (BIT) with Gulf Cooperation Council (GCC) countries.

Gohar Ejaz led an official delegation to Saudi Arabia comprising of Secretary Ministry of Commerce Sualeh Farooqui, Sohail Rajput, Secretary BoI, Brig Ali Bhatti, SIFC, Zuhair, Attorney General Office and held discussion with GCC to finalise investment-related part of GCC FTA.

“GCC FTA completed today. All three options agreed left for investors to decide after eight months period for mutual settlement through available forums in case of dispute. We have got them to agree to first go for negotiation and consultation in domestic forums to resolve the investment disputes. Only after the domestic forums are given fair chance, international arbitration is agreed to,” Gohar Ijaz told Business Recorder from Riyadh, Saudi Arabia.

FTA with GCC states making little or no headway

At a recent meeting, Federal Cabinet directed Board of Investment to show flexibility in adopting an international dispute settlement mechanism in case GCC/ international investors do not agree on domestic arbitration, the sources added.

These directions were issued after threadbare discussion with the GCC countries including Saudi Arabia and Qatar which are insisting on the option of international arbitration in a template of Bilateral Investment Treaty.

BoI informed the Cabinet on November 15, 2023 that the Federal Minister for BoI was mandated to initiate negotiations on BIT with the Kingdom of Saudi Arabia in March 2023, as the signing of BIT between the two countries was a significant component of the economic pillar under the framework of Saudi-Pakistan Supreme Coordination Council (SPSCC).

According to Commerce Ministry, the delegation held parleys with GCC’s Chief Negotiator to finalise the investment-related part of the GCC Free Trade Agreement.

The technical teams from two sides held extensive discussions on the remaining details of the investment chapter, including investment protection and facilitation.

BoI is of the view that during the course of formal negotiations on September 26-28, 2023, the GCC team shared the interest of the State of Qatar to also become part of the Pak-KSA BIT under the umbrella of Pak-GCC FTA negotiations.

The request of the State of Qatar was shared with BoI by the Ministry of Commerce through diplomatic channels on October 2, 2023.

It was noted that at the end of the three days of negotiations, differences remained between the two sides on some of the clauses of the draft BIT, as KSA and the State of Qatar continued to insist on the inclusion of their version of these clauses, which were in substantial deviation from Pakistan’s Model BIT template.

The deviations noted were: (i) definition of investment to cover indirect forms of investments; (ii) definition of investors should not be restricted to domiciled investors only; (iii) Article on the Scope of the Agreement shall be included; (iv) Article 6, 2(a) Denial of Justice in criminal, civil and administrative proceedings must be open for investors to choose any forum of dispute settlement; (v) Article on Principles of Subrogation shall be included; (vi) Investors must be allowed the freedom of choice to access either domestic dispute settlement forums or any of the international dispute settlement forums, including ICSID; (vii) Article on Compensation of Losses shall be included; and (viii) final provisions, BIT for an indefinite period (exclude sunset clause and survival clause.)

According to sources the final draft sent by KSA and the State of Qatar was circulated amongst all relevant ministries/ departments, along with a comparison matrix on key divergences between Pakistan’s Model BIT template, to ascertain their views/ comments.

The comments received from the stakeholders with the Cabinet, are summarised as follows: (i) Office of the Attorney General for Pakistan agreed in principle to the text, subject to the approval of the Federal Cabinet; (ii) National Security Division suggested incorporating additional expression in the Article on Scope in order to exclude existing disputes. A graduated approach in investor-state dispute settlement (ISDS) would also be preferred. Any BIT in perpetuity may not serve its purpose in the long run; (iii) Private Power & Infrastructure Board (PPIB), while agreeing in principle, suggested incorporating appropriate qualifiers, as well as, a few amendments in the language of the paragraph on ‘Denial of Justice’ and in the case of inclusion of ICSID as an arbitration forum; (iv) Ministry of Foreign Affairs suggested introducing some threshold of shareholding for indirect investment, defining a timeframe for domestic legal remedies, and reconsidering the option of multiple international arbitration forums including ICSID, as it may pose unforeseen challenges; and (v) Ministry of Finance suggested extensive protection for the State of Pakistan on existing disputes and in the case of subrogation.

The official statement says the two sides also discussed the possibility of holding a joint business forum in the near future to promote trade and investment between Pakistan and the GCC.

Copyright Business Recorder, 2023

Comments

Comments are closed.

Aam Aadmi Dec 03, 2023 06:28pm
Pakistan has signed FTAs with quite a few countries. How many of those FTAs have benefitted Pakistan and to what extent? All these steps are routine dramas with little or no substance, an activity just for the sake of activity. We must first enhance our export potential or else these trips will remain merely pleasure trips. By the way, what was the relevance of presence of a Brigadier in the delegation?
thumb_up Recommended (0)