Opposition disputes Peter Kenilorea’s claim that the Solomon Islands-US DFC agreement matches India’s “word for word”.
Honiara, Solomon Islands – The Parliamentary Opposition Group has responded to comments by Hon. Peter Kenilorea Jnr during last week’s Motion of Thanks debate, disputing his claim that the Solomon Islands–United States International Development Finance Corporation (DFC) Investment Incentive Agreement is the same as India’s agreement “word for word”.
A text-based comparison of the two agreements identifies seven material differences in the protections and safeguards retained by each country.
India’s agreement expressly preserves its right to regulate investments in accordance with its laws and policies. The Solomon Islands agreement contains no comparable express protection. India also retains jurisdiction of its local courts over DFC-related claims, while the Solomon Islands agreement provides the DFC with an exemption from such jurisdiction.
The two agreements also differ significantly in their treatment of taxation and damages. India’s agreement does not provide a blanket tax exemption for DFC operations, and places limits on damages, including claims for lost profits or goodwill. The Solomon Islands agreement provides broader tax exemptions and does not contain a comparable cap on damages.
There are further differences in dispute resolution and reciprocity. India’s agreement requires a 12-month negotiation period before arbitration can be triggered, compared with 90 days under the Solomon Islands agreement. India’s agreement also includes a reciprocal guarantee of equal treatment in the United States, while no comparable provision is included in the Solomon Islands agreement.
The agreements also differ in how long their protections continue after termination. The comparable survival period in India’s agreement is 12 years, while Article 5(c) of the Solomon Islands agreement allows its provisions to continue applying to Investment Support provided while the agreement was in force for as long as that support remains outstanding, subject to a maximum of 25 years after termination.
Across the seven comparable safeguards identified in the Opposition’s text-based comparison, India retained six of the seven sovereignty-protective terms, while the Solomon Islands agreement retained none of them.
The Opposition Group therefore considers it misleading to describe the two agreements as being the same “word for word”.
Hon. Kenilorea also suggested that the amendment and termination provisions provide the Solomon Islands with stronger safeguards. The Opposition acknowledges that the Solomon Islands agreement allows the parties to amend the agreement by mutual written agreement and to terminate it with six months’ written notice.
However, the existence of those provisions does not change the material differences between the two agreements or remove the need to assess each agreement on the basis of its actual terms.
“Our position is not based on fear of investment or partnership with the United States. It is based on the simple principle that agreements entered into on behalf of Solomon Islanders must be accurately represented and properly scrutinised.
“The public must also be given an accurate account of the agreement and whether the protections secured by other countries were also secured for Solomon Islands,” the Leader of the Opposition Group in Parliament said.
SOURCE//; Opposition Press Release
