Previous Clause | Next Clause | Table of Contents

(a) Except in the case of generally applicable exchange controls imposed on a non-discriminatory basis during a limited time period of genuine fiscal emergency, the State confirms that interest, dividends and all other payments for goods and services are freely remittable from the State and that if foreign currency is required to make such payments, in addition to that available from foreign currency accounts authorized under this Agreement, foreign currency will be made available to make such payments up to the amount of foreign currency payments made by the Company to the State and converted into the State currency.

(b) The Company has the right to establish, maintain and hold funds in bank accounts in [COUNTRY currency] and in US Dollars in the State in as well as bank accounts in foreign currency located outside the State.

(c) The Company has the right to freely repatriate abroad without any barriers and to and freely dispose of all proceeds (including by way of dividend or other form of distribution) received within the State from the sale, exchange or export of Minerals, and any other payments (including loan principal and interest) to be made abroad.

(d) Any obligation originally stated in the State currency shall be converted to US Dollars at the prevailing market rate of exchange.

(e) For purposes of determining compliance by the Company of required payments in the State currency under Applicable Law (including without limitation any Law determining minimum wages), the amount of any payment by the Company made in US Dollars shall be converted to the State currency at the prevailing market rate of exchange as of the date of payment.

(f) The Company shall have the right to remit and receive in US Dollars all payments of dividends, interest, finance charges, principal, management fees and other property payable items arising from, as a result of, or related to the operations of the Project.

(g) All remittances and receipts of such payments shall be free of any penalties in connection with such remittances or receipts, any required total or partial surrender, exchange or confiscation of US Dollars received to be remitted, and any other direct or indirect restriction on such remittances or receipts.

(h) The Parties acknowledge that the Company may:

(a) Obtain, hold, deal with and disburse funds in such manner, currencies and places as it, in its absolute discretion, determines;
(b) Freely import into the State funds necessary to properly carry out the Project;
(c) Remit foreign currency accruing to or earned by it outside the State into the State;
(d) Remit proceeds (in currency or otherwise) and repatriate capital (in cash or assets) outside the State; and

(i) Amounts received and expenditure made in [COUNTRY CURRENCY] or in US Dollars shall be converted from [COUNTRY CURRENCY] into US Dollars or from US Dollars into [COUNTRY CURRENCY] on the basis of prevailing market rates for the month in which the relevant transaction occurred.

(j) Amounts received and expenditure made in currencies other than US Dollars or [COUNTRY CURRENCY] must be converted into US Dollars or [COUNTRY CURRENCY] on the basis of the monthly average of prevailing market rates for the month in which the relevant transaction occurred.

*See related provisions at 9.1 Payments and Exchange Rates.

Example 1
9.1 Foreign and Domestic Bank Accounts. Company shall be authorized to establish, maintain and administer bank accounts in banking institutions and depositories located both outside and inside the Country. Company shall deposit all revenues and proceeds from Operations, including the sales of the Royalty Minerals extracted and the sale of any Electricity produced as contemplated by Section 7.12, in one or more of such bank accounts (the “Special Accounts”) as herein set forth. Proceeds from any sales of Electricity, Minerals or other products within the Country for [local currency] shall be deposited in one or more Special Accounts located inside the Country. Proceeds from all other sales may be deposited in Special Accounts located outside the Country. Disbursement from each such Special Account shall be made only as set forth in this Agreement.

[…]

9.6 Freedom of Currency Exchange and Transfer of Funds.

(a) Company shall be entitled to open and maintain, and to retain moneys (including interest arising on the balances therein) in, [local currency] bank accounts located in the Country and foreign currency bank accounts located outside of the Country. For purposes of compliance with Foreign Investment registration, as provided by Law No. [x], equity funds deposited in any offshore accounts shall be eligible for registration under Law No. [x] on Foreign Investment. Company shall apply and comply with the foreign investment registration requirements and procedures set forth by Law No. [x] and this Agreement.
(b) COMPANY shall be entitled to exchange, with commercial banks, exchange agents and any other entities authorized by the Monetary Board, from time to time, [local currency] into foreign currency according to applicable monetary laws and resolutions of the Monetary Board, subject to payment of any exchange fee (the “Exchange Commission”)), commission, administrative fee, charge or tax that could be levied upon foreign currency transactions. At the Signature Date, the Exchange Commission was set at 4.75%. COMPANY shall not be required to pay any fee, charge or commission to the STATE or any agency thereof on or with respect to actual or deemed conversion of foreign currency into [local currency] or on or with respect to the importation of goods, supplies or equipment into the Country.
(c) Notwithstanding Section 9.6(b), COMPANY shall have the right to make all investments in and payments with respect to the Project in Dollars or other foreign currency, including payments for the importation of goods, machinery, spare parts, supplies and equipment, the repayment of loans, off shore services and any other payment to a non-resident entity or individual. Any such payment may be made by COMPANY in Dollars or other foreign currency generated by or as a result of (i) Operations, (ii) equity from its shareholders, or (iii) proceeds from loans obtained by COMPANY, and in no event shall any such payment be subject to payment of any Exchange Commission or similar fee.
(d) The exchange rate applicable to any COMPANY transaction shall be the rate that COMPANY is able to freely negotiate with any commercial banks, exchange agents and any other entities that are authorized by the Monetary Board, from time to time, at the sole election of COMPANY.
(e) COMPANY shall have the unrestricted right to expatriate to any country all funds to which it is entitled to withdraw pursuant to this Agreement, including amounts disbursed from the Special Accounts pursuant to Section 9.2(d).

Example 2
11. FOREIGN EXCHANGE
The Parties acknowledge that under legislation and practice currently in force in Country, subject to Clause 0, COMPANY is free to:

11.1.1 remit foreign currency out of Country;
11.1.2 maintain any monetary assets (including foreign currency accounts) outside and within Country; and
11.1.3 remit foreign currency accruing to or earned by it outside Country into Country.
In the event foreign exchange controls were to be re-introduced in Country within the Stability Period, COMPANY shall have (without any further approvals from Government or any entity thereof being required) the right to:

[list of rights]

[…]

In the absence of foreign exchange controls in Country, COMPANY shall have the same rights to buy and sell currencies from authorised dealers and enter into swaps and hedging arrangements (which expression shall include, without limitation, arrangements for taking out forward cover against local and other currency fluctuations or other fluctuations in incomes or costs or other expenses incurred as part of the management operations but shall not include Speculative Currency Transactions) with non-Country entities as other commercial concerns in Country. In the event foreign exchange controls were to be reimposed in relation to the purchase and sale of currencies (and without prejudice to COMPANY’s rights under Clause 0), such controls shall not be applied to COMPANY in a manner less favourable to it than the manner in which they are generally applied to other large commercial concerns in Country. COMPANY shall be entitled to buy and sell foreign currency in accordance with such controls at rates of exchange no less favourable or otherwise prejudicial than those available to other commercial buyers and sellers of the currency concerned.
COMPANY shall remit to Country, and convert into [local currency] for credit to a bank account in the name of COMPANY, sufficient of its foreign currency earnings to pay such commitments as COMPANY may have incurred in [local currency], but only to the extent COMPANY does not already have [local currency] available to meet such commitments (including, without limitation, taxes, royalties and customs duties and obligations to pay dividends to local shareholders payable in local currency, if applicable). COMPANY shall use its reasonable endeavours to notify the Central Bank of transfers of a substantial amount which are not in accordance with the normal pattern of transfers.
COMPANY shall not engage in or use any provisions of this Clause 11 or any authority or approval given by the Central Bank, to engage in Speculative Currency Transactions. For the avoidance of doubt, this Clause shall not prohibit or prevent normal risk management operations which shall be deemed to include the entering into of hedging agreements ordinarily utilised by mining companies in the international mining industry. COMPANY shall ensure that any borrowings it may incur denominated in [local currency] shall not exceed five per cent (5%) of annual sales revenues as recorded in the latest set of audited annual accounts of COMPANY. In the event COMPANY determines to sell foreign currency held by it, it shall not discriminate against the Central Bank if the Central Bank is demonstrably willing and able to purchase foreign exchange at market rates and on terms that are no less favourable to COMPANY than terms available from other buyers.

Example 3
CURRENCY EXCHANGE
1. All investment remittances into Country for the purpose of any expenditures to be made in Country (including but not limited to equity capital and loan capital) shall be deposited into a foreign investment account (the PMA Account) established at one or more foreign exchange banks in Country. All such investment remittances shall be used in accordance with the prevailing investment and utilization of offshore funds regulations applicable to foreign investment law companies established under the Foreign Investment Law. The conversion or sale of foreign exchange originating from the PMA foreign currency account is to be done with foreign exchange banks.
2. The company shall be granted the right to transfer abroad, in any convertible currency, funds in respect of the following items, provided that such transfers are effected in accordance with the prevailing laws and regulations and at the prevailing market rates of exchange to commercial transactions as follows:
[list of monies]
3. The proceeds of the export sales of minerals and any products derived from them can be used as the Company sees fit. Without prejudicing the foregoing rights of the Company, the Company agrees that with regard to the proceeds of the Company’s export sales it shall comply with laws and regulations from time to time in force.
4. The Company in the exercise and performance of its rights and obligations set forth in this Agreement shall be authorized to pay abroad, in any convertible currency, without conversion into [local currency], for the goods and services it may require and to defray abroad, in any currency it may desire, any other expenses incurred for mining operations under this Agreement.
5. In respect of other matters of foreign currency arising in any way out of or in connection with this Agreement, the Company shall be entitled to receive treatment no less favorable to the Company than that accorded to any other Mining Company carrying on operations in Country.
6. Subject to the foregoing paragraphs of this Article 15, the Company shall comply with all financial reporting and approval requirements applicable to foreign investment law companies established under the Foreign Investment Law.

Example 4
9.4 The Investor shall be entitled to maintain bank accounts in a commercial bank of Country and elsewhere, and the Investor may make international transactions freely and without any obstructions in its chosen currency. Without affecting the Investor’s rights under Clause 9.10.5, payments for goods and services inside Country must be made in Country currency in accordance with Country laws and regulations, unless the Investor is authorised to make such payments in foreign currency as a result of an authorisation issued by the Bank of Country in accordance with Article [x] of the Law of Country on Conducting Settlements in National Currency.

[…]

9.10. The Investor has the following rights:

9.10.1. to provide in freely convertible foreign currencies all funds needed to conduct Core Operations and to convert such currencies to Host Country currency as it deems necessary;
9.10.2. to hold and freely dispose of any funds outside of Country;
9.10.3. to retain abroad and freely dispose all of its proceeds received outside of Country from the export, sale or exchange of Product;
9.10.4. to freely repatriate abroad without any barriers and to and freely dispose of, all proceeds (including by way of dividend or other form of distribution) received within Country from the sale, exchange or export of Product, and any other payments (including loan principal and interest) to be made abroad;
9.10.5. to freely pay its Contractors, Subcontractors and citizens of Country operating outside Country in foreign currencies; and
9.10.6. to maintain, if it wishes (but with no obligation to do so), an account or accounts in a bank in Country chosen by the Investor for foreign currency.

Example 5
Financial Conditions
31.1 Subject to the provisions of this Agreement, the State guarantees to Company, the SEP, the Operator, and their Affiliates and subcontractors, during the term of this Agreement:

(a) free conversion and transfer of funds intended for the payment of all debts (principal and interest) in foreign exchange to non-host country creditors;
(b) free conversion and transfer of Net Cash Flow for distribution to non-host country partners and all amounts allocated for the amortization of financing obtained from non-host country institutions including loans obtained from Affiliates, after having paid all taxes and levies imposed under this Agreement;
(c) free conversion, and transfer of profits and of funds resulting from the liquidation of shareholdings, after payment of taxes, customs duties and levies under the Agreement.

31.2 The Parties agree to request upon the effective Date of this Agreement from the proper authorities. The authorization for the Operator of each SEP to maintain overseas, in US dollars or any other convertible currency, an amount, realized from its export sales, sufficient to meet its requirements for the forthcoming six-month period with respect to payments to non-host country vendors and creditors for such goods and services purchased, as well as loans incurred for its activities.
31.3 Company and the Operator of each SEP shall be authorized to open a bank account in Country denominated in foreign exchange.
31.4 The State guarantees the free conversion and transfer overseas of the savings of expatriate personnel of Company, and each Operator as well as their Affiliates and subcontractors, resulting from their salaries or the liquidation of investments in Country or the sale of personal effects in Country.

Example 6
7.3 Foreign Accounts and Currency Transactions

a) Licensee shall be subject to the procedures and formalities required by the Law and regulations relating to foreign exchange and currency transactions, including the Exchange Control Regulations, in force from time to time in [name of host country].
b) Subject to Section 7.3(a), Licensee shall have the right to freely make funds and other transfers incident to its operations and investments pursuant to this Agreement in freely convertible currency, including: (i) contributions to capital, (ii) profits, dividends, capital gains, and proceeds from the sale of all or part of the investment made pursuant to this Agreement or from the complete or partial liquidation of said investment, (iii) interest, management fees, and technical assistance fees, and (iv) payments due under contracts, including loan payments, provided that taxes and other obligatory payments are made in accordance with the relevant Laws.
c) Licensee shall have the right to open and operate local currency accounts and foreign currency accounts in banks within [name of host country].
d) In order to keep the Exchange Control authorities of the Government informed of its prospective and actual foreign exchange transaction, Licensee shall inform the National Bank of [name of host country] (the “National Bank”) in writing and in such form and detail as the National Bank may reasonably request: (i) the location of the Licensee’s bank accounts in [name of host country]; (ii) annually, before the commencement of each fiscal year of Licensee, Licensee’s projected receipts and disbursements of foreign exchange by principal headings for the coming year (which statement may be amended from time to time if this appears necessary); (iii) Licensee’s actual receipts and disbursements of foreign exchange by principal headings during the preceding quarter, within thirty (30) days of the end of each applicable calendar quarter.
e) Licensee shall have the right to purchase or otherwise acquire for payment abroad the foreign currencies needed in furtherance of its activities under this Agreement, for payment for goods and services acquired abroad, for payment of external debt service (interest and amortization), and for payment of dividends on Licensee’s shares held abroad.
f) Licensee’s Staff being employed and residing in [name of host country] pursuant to this Agreement shall be entitled to remit to his home country or to the country of which he is a citizen:

(i) not less than [X%] of the salary received by him in [name of host country] each month;
(ii) upon approval by the National Bank, such additional sums, payable out of his salary received in [name of host country], as he may require to meet insurance premiums, maintenance of dependents, tuition, and other costs for his children and family incurred abroad; and
(iii) upon termination of his employment in [name of host country], such sums as he can show to have been reasonably accumulated by way of savings and investments from his salary received in [name of host country] or from the disposal of movable property owned by him in [name of host country].

g) Licensee and Licensee’s Staff shall be entitled to the relevant exchange facilities, rates, and charges on no less favorable terms than those which are currently and consistently applied to other mining operations or to the general public, whichever terms are more favorable.

REFER TO MMDA DISCLAIMERS AND MMDA USER’S GUIDE
PRIOR TO ANY USE OF THIS DOCUMENT.

Previous Clause | Next Clause | Table of Contents

Chinese (Simplified) French Portuguese (Brazil) Russian Spanish