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REVISED BASIC AGREEMENT ON
ASEAN INDUSTRIAL JOINT VENTURES

THE GOVERNMENTS

OF BRUNEI DARUSSALAM,

OF INDONESIA, MALAYSIA, THE REPUBLIC
REPUBLIC OF SINGAPORE

THE REPUBLIC

OF THE PHILIPPINES, THE

AND THE KINGDOM OF' THAILAND.

MINDFUL of the D e c l a r a t i o n of ASEAN Concord
in B a l i , Indonesia on 24 February
Member

Countries

1976, which provides

shall take cooperative actions

and regional development programmes,

national

broaden

the

complementarity

of

that

in

their

utilizing

far as p o s s i b l e the resources a v a i l a b l e in the ASEAN
to

signed

their

as

region

• respective

economie s;
'REAFFIRMING

acceleration

their desire to collaborate

of economic

for

growth in the r e g i o n , to

the

promote

the greater u t i l i z a t i o n of their agriculture and i n d u s t r i e s ,
the

expansion

economic

of

their trade

of

their

of

their

CONVINCED that the c o n s o l i d a t i o n of markets

among

infrastructure

and

improvement

for the mutual

benefit

people;

ASEAN

countries

ventures
broadening
respective

can support

meaningful

industrial

joint

which can greatly c o n t r i b u t e to strengthening
the

base

of

industrial

sectors

of

and
their

economies, promoting the g r e a t e r u t i l i z a t i o n

t h e i r i n d u s t r i e s and expansion of t h e i r t r a d e ;

of

NOTING

the

suggestions

on

industrial

joint

ventures

which have been advanced by the ASEAN Chambers

Commerce

and

demonstrated

Industry
by

(ASEAN-CCI),

and

the ASEAN-CCI in the

the

of

confidence

viability

of , ASEAN

i n d u s t r i a l joint v e n t u r e s ;

AFFIRMING

countries,

the

encouraged

that

private

in

the economies

sector

shall

of

the

continue

to play the major role in most of

the

ASEAN

to

be

'economic

a c t i v i t i e s , including industry and t r a d e ;
D E SIRI N_G

to

provide

the

guidelines

i n s t i t u t i o n a l framework w i t h i n which the ASEAN

and

Governmental

machinery and the p r i v a t e sector, throug h the ASEAN-CCI, may

collaborat-e to identify o p p o r t u n i t i e s , f o r m u l a t e - programmes
and

d e s i g n p r o j e c t s for p u r s u i n g i n d u s t r i a l joint

ventures

On the basis of m u t u a l and equitabl'e b e n e f i t s for ,the member
c o u n t r i e s and increased i n d u s t r i a l p r o d u c t i o n for the region

as a whole.
DO

HEREBY AGREE to pursue ASEAN I n d u s t r i a l ' Joint

V e n t u r e s as s t i p u l a t e d by the following provisions:

1)

AN Industrial Joint, V e n t u r e (AIJV) p r o d u c t is

processed

final

list

any 1

or m a n u f a c t u r e d p r o d u c t which is included in- the

of AIJV p r o d u c t s referred to

in

• Ar'ticle

II,

p a r a g r a p h 3 or in the AIJV Products List (APL),drawn up

and

approved

by the ASEAN Committee on Industry,

Minerals

and

Energy (COIMK) in accordance with A r t i c l e II Paragraph 9.

2)

An AIJV p r o d u c t may be an e x i s t i n g product

or

a

new product ;

a)

An

existing

'processed

product

is one

which

is

being

or m a n u f a c t u r e d in any of

the

parti-

c i p a t i n g c o u n t r i e s at the time of its inclusion in

b)

the

final list. •

Any

p r o d u c t not covered by the d e f i n i t i o n

of

an

existing product is a new p r o d u c t .

3)

An AIJV is any entity which:

a)

produces

an AIJV product in any of

the

partici-

pating countries;
b)

has

equity

least two
c)

satisfies
specified

the

p a r t i c i p a t i o n from

nationals

of

at

participating countries; ,
the
in

equity
paragraph 5

ownership
of this

minimum 5 per cent e q u i t y

provisions
Article

and

contribution

from

nationals of each p a r t i c i p a t i n g country.

4)

With

participating
indicated

tariff
provided
country

r e s p e c t to

a

particular

AIJV

country is an ASEAN membe r country wh ic'h

its intention to p a r t i c i p a t e by way

preference
for
which

product,

as

well

in A r t i c l e III
has

not

as

the

hereof.

indicated

its

other
An

of

a

has

providing

privileges
ASEAN

intention

member
to

so

p a r t i c i p a t e is a n o n - p a r t i c i p a t i n g

country with r e s p e c t

to

that p a r t i c u l a r AIJV p r o d u c t .
5)

A

cent

of

minimum

ASEAN equity

ownership of

shall be r e q u i r e d for any proposed

projects

before

3]

applicable

cent.

for

AIJV.

which AIJV status has

December

1990 and

been

subsequently

51

In

per

respect

applied

for

approved,

the

minimum ASEAN 'equity ownership shall be

40

per

The minimum ASEAN equity shall not apply to an entity

in any of the following cases:

a)

where
AIJV

the p a r t i c i p a t i n g c o u n t r i e s in
product

agree to a higher

a

proposed

equity

partici-

pation by non-ASEAN i n v e s t o r s ;
b)

where

more

produced

than

50

per

cent

of

the

product

by such entity will be exported to

non-

ASEAN markets;

c)

where the product is already being p r o d u c e d by
entity

in

a p a r t i c i p a t i n g country p r i o r

to

an
its

inclusion in the final l i s t ; or
d)

where

an

entity has already been a p p r o v e d

participating

country

to

produce

that

by

a

product

prior to the inclusion of the product in the final

list.

6)

The i n v e s t o r s in an

AIJV shall be free to

locate

their projects in 'any of the p a r t i c i p a t i n g c o u n t r i e s .

7)

(AEM)

The

or

approval by

COIME, as

the ASEAN

delegated

Economic

by AEM,

of

the

Ministers

final

list

or

extend

the

a

minimum

preference

to

p r o v i d e d for

8)

shall

APL carries with it

the

pre-commitment

ninety (90) per cent

margin

of

to

tariff

AIJV pro'ducts by p a r t i c i p a t i n g c o u n t r i e s

in

A r t i c l e III

Non-participating

paragraphs

1 and

as

6. •

c o u n t r i e s in an

AIJV

waive t a r i f f p r e f e r e n c e s extended under

product

Article

III

subject to the c o n d i t i o n s therein s t a t e d .

9)

Any t a r i f f p r e f e r e n c e s extended by

ting countries among themselves for

non-participa-

AIJV p r o d u c t s shall

be

in accordance with the p r o v i s i o n s of C h a p t e r II, A r t i c l e

8,,

paragraph

2 of the Agreement on ASEAN P r e f e r e n t i a l

Trading

A r r a n g e m e n t s (PTA).

ARTICLE
II
INSTITUTIONAL ARRANGEMENTS FOR
APPROVAL OF AIJV PRODUCTS

1)

The C o m m i t t e e

on Industry,

Minerals

and

Energy

(COIME) shall i n v i t e ' n o m i n a t i o n s for AIJV products from

the

ASEAN-CCI

for

existing

and ASEAN member countries.,

All nominations

AIJV p r o d u c t s shall be a c c o m p a n i e d by

details

e x i s t i n g p r o d u c t i o n f a c i l i t i e s , such as ownership,

and

production

of

location

c a p a c i t i e s . '-These shall be compiled

at

a'

COIME m e e t i n g into a t e n t a t i v e list of AIJV p r o d u c t s .

2)

ASEAN

tentative

list

meeting,

the

participate

and

member

and

countries

i n d i c a t e to

products

in

d e c l a r e any

which

shall1

COIME
they

at

examine

a

would

such

subsequent
like

-to

existing p r o d u c t i o n • f a c i l i t i e s

they

have for such p r o d u c t s .

least

two

intention

ASEAN
to

member

participate

Those p r o d u c t s for which

countries

have

indicated

shall be included in

at
their

the

final

list showing t h e p a r t i c i p a t i n g member c o u n t r i e s .

3)

The

COIME

made

as

final list s h a l l be s u b m i t t e d to the

AEM

or

thereafter

be

Chambers

of

For new AIJV p r o d u c t s , i n t e r e s t e d p a r t i e s shall

be

d e l e g a t e d by AEM for approval and

available

to the ASEAN-CCI and n a t i o n a l

Commerce and Industry in ASEAN member c o u n t r i e s .

4)

given six months from the date the final list is a p p r o v e d to
o b t a i n a p p r o v a l from the a p p r o p r i a t e govern'ment agencies

to

p r o d u c e such p r o d u c t s .
5)

At the end of the s t i p u l a t e d six-month - p e r i o d , all

p a r t i c i p a t i n g c o u n t r i e s shall inform
cations

COIME of those

for the p r o d u c t i o n of new AIJV

approval

has been g r a n t e d .

appli-

p r o d u c t s f o r , which,

Any product for which

approval

has not been granted within the s t i p u l a t e d six-month

period

shall be a u t o m a t i c a l l y d e l e t e d from the l i s t .

6)

COIME shall inform all member c o u n t r i e s of

those

new AIJV p r o d u c t s for which approval has been g r a n t e d .

7)
shall

For

e x i s t i n g AIJV p r o d u c t s ,

interested

parties

seek t h e i r r e s p e c t i v e governments' c o n f i r m a t i o n

t h e i r e n t i t i e s q u a l i f y as

that

AIJVs under t h i s A g r e e m e n t , after

the i n c l u s i o n of their AIJV p r o d u c t s in the final list.

8)

For

countries

existing

shall

AIJV

inform

products,

COIME

of

all

participating

entities

that

have

qualified as AlJVs under this Agreement.

9)

In

addition

to

the

above

institutional

a r r a n g e m e n t s , the following are h e r e b y p r o v i d e d ;

a)

Each ASEAN member
AIJV

p r o d u c t s which it shall support 'a,nd

in p r i n c i p l e for

of

country shall draw up a list of

AIJV

locally

AIJV s t a t u s .

products

could

approve

Such .country - lists

include

products

not

produced in the r e s p e c t i v e c o u n t r i e s

and

p r o d u c t s with export p o t e n t i a l .

b)

From

these

lists,,

COIME will draw

AIJV

List

products

for wh ich at least two m e m b e r , c oiint r i e s

expressed

indicate

this

support,

consist

an

Products

have

w h i c h ' shall

up

and

which

of

those

shall

-s-o

the p a r t i c i p a t i n g member c o u n t r i e s .

To

list COIME shall add o t h e r p o t e n t i a l

AIJVs.

This list shall be made available' to the ASEAN-CCI
and national Chambers of Commerce and Industry
ASEAN m e m b e r countries and shall be u p d a t e d

in

every

s ix month s.
c)

Any AIJV a p p l i c a t i o n submitted to COIME on any

of

t h e ' p r o d u c t s in the APL is automatically c o n f i r m e d
as

an

a p p r o v e d AIJV and

automatically
only

acquires

the

an

proponent

AIJV

to compliance with the AIJV

status

company

subject

requirement

p r o v i d e d under A r t i c l e I, p a r a g r a p h 3 h e r e o f .

as

10)

COIME

shall issue a c e r t i f i c a t i o n in

favor

the AIJV c e r t i f y i n g its entitlement to the p r i v i l e g e s
the

Basic

(BAAIJV).

Agreement

on ASEAN

Industrial

Joint

of
under

Ventures

Such c e r t i f i c a t i o n shall also s p e c i f y the date on

which the tariff p r e f e r e n c e and all the p r i v i l e g e s a v a i l a b l e

to the AIJV shall take effect.

New AIJV P r o d u c t s
1)

Where an a p p l i c a t i o n for the p r o d u c t i o n of an AIJV

p r o d u c t has been approved by any p a r t i c i p a t i n g country,

and

due

all

notification

participating
tariff

thereof

countries

preference

of

has

been given

to

COIME

shall extend a minimum
90 per cent for

that

margin

AIJV

of

product

within 90 days of its commercial production.

2)

The

paragraph

The four-

commercial

of

commence

from

the

III

p e r i o d , only to AIJVs in p a r t i c i p a t i n g c o u n t r i e s .

shall

a p p l y , during

Article

four-year

period

shall

in

initial

year

1

tariff preference described

the

p r o d u c t i o n of the AIJV product

actual

date

or upon

of

expiry

30 months from the date of a p p r o v a l of the inclusion

of

p r o d u c t in the final l i s t or in the APL, w h i c h e v e r

is

that

earlier.
3a)
their

N o n - p a r t i c i p a t i n g c o u n t r i e s shall i n i t i a l l y
rights

under Chapter II, Article 8, paragraph

waive
2

of

the

ASEAN P r e f e r e n t i a l Trading Arrangements (PTA) for

first

four

years.

participating
time

after

country

The maximum

waiver

p e r i o d ' for

c o u n t r i e s shall be 8 y e a r s .
the

can

first

enjoy

four

the

MOP

years, , a

granted

by

participating

itself.

the waiver period shall be extended beyond

four

years

of

of

the

non-participating

a

MOP,

the

first
country

this p o s i t i o n subject to a max imum waiver

8 years.

margin

• If

country does not wish to grant such

for as long as

any

'non-participating

then

maintains

non-

However, at

countries as soon as it extends the same MOP
non-participating

the

period

N o n - p a r t i c i p a t i n g c o u n t r i e s need not extend
p r e f e r e n c e to p a n t i c i p a t i n g

countries

on

a

AIJV

product s .

b)

N o n - p a r t i c i p a t i n g countries

upon

notification

participating

and

countries

which so d e s i r e ,

c onc'ur rence of

COIME,

may

at any time and shall

and

become

extend

the

same m a r g i n of t a r i f f p r e f e r e n c e for t h a t AIJV p r o d u c t .

c)

P a r t i c i p a t i n g c o u n t r i e s shall waive

their

rights

under Chapter II, A r t i c l e 8 p a r a g r a p h 2 of the ASEAN PTA for
the

first four years in r e s p e c t of e n t i t i e s which

are

not

AIJVs but p r o d u c e the same p r o d u c t s w i t h i n t h e i r c o u n t r i e s ,

d)
entity

A f t e r the waiver p e r i o d for an
in

any

member country

which

AIJV p r o d u c t ,
produces

that

p r o d u c t , i r r e s p e c t i v e of whether it qualified as an

any
AIJV

AIJV or

not, shall enjoy the same margin of tariff preference in the

participating

c o u n t r i e s f o r , t h a t AIJV p r o d u c t .

4)

In

the

event that there

is

only

one

p r o j e c t for a new AIJV p r o d u c t by the end of the

approved
stipulated

six-month p e r i o d , the p a r t i c i p a t i n g c o u n t r i e s shall grant to
that

AIJV e x c l u s i v i t y p r i v i l e g e s .

shall

Exclusivity

privileges

continue for a p e r i o d of t h r e e years commencing

from

the actual d a t e of commercial p r o d u c t i o n of the AIJV product
or

upon

the

inclusion

of

expiry

the

from

p r o d u c t in the

whichever

is

than

approved

one

of 30 months

earlier.

In

the

of

list

or

APL,

the event that there

is

more

project

for

final

date

a

new

AIJV

product,

e x c l u s i v i t y p r i v i l e g e s shall not be g r a n t e d .

5)

Exclusivity

p r i v i l e g e s in this

Agreement

shall

mean that d u r i n g the e x c l u s i v i t y period of three years,

the

p a r t i c i p a t i n g c o u n t r i e s cannot set up new p r o d u c t i o n facili-,
t i e s for the same p r o d u c t , other than the a p p r o v e d
unless
ASEAN

project,

75 per cent of its p r o d u c t i o n is for export to
countries.

A p r o d u c t i o n f a c i l i t y is deemed

to

nonhave

b e e n set up when it is in c o m m e r c i a l p r o d u c t i o n .

E x i s t i n g AIJV P r o d u c t s

6)

The

p a r t i c i p a t i n g countries shall

extend

'to

an

e x i s t i n g AIJV p r o d u c t the same t a r i f f p r e f e r e n c e as p r o v i d e d
for

in A r t i c l e III,

of

i n c l u s i o n of that p r o d u c t in the

7)
paragraph

The
6

paragraph

1 w i t h i n 90 days from, the d a t e

final list or APL.

t a r i f f p r e f e r e n c e d e s c r i b e d in
shall

apply,

the

III,

initial

four-year

p e r i o d , only to AIJVs in p a r t i c i p a t i n g c o u n t r i e s .

The four-

10

during

Article

year period shall commence from the actual d a t e of implemen-

t a t i o n of t a r i f f p r e f e r e n c e .

8a)

Non-participating countries

their

rights

shall i n i t i a l l y waive

under Chapter II, A r t i c l e 8, p a r a g r a p h

the ASEAN PTA for the first four years.

2

The maximum

of

waiver

p e r i o d for n o n - p a r t i c i p a t i n g c o u n t r i e s shall be e i g h t y e a r s .
However,

at

any time after the f i r s t

participating

country

participating
itself.

can.

enjoy

four y e a r s ,

the

MOP

a

granted

by

countries as soon as it extends the same

MOP

If a n o n - p a r t i c i p a t i n g country does not

grant

such

MOP,

then the waiver p e r i o d shall

beyond

the

first

four

p a r t i c i p a t i n g country
maximum

waiver

countries

need

non-

years for

long

as

be

to

extended

the

non-

m a i n t a i n s this p o s i t i o n subject to

p e r i o d of eight

not

as

wish

extend

a

years.

margin

a

Non-participating

of

preference

to

p a r t i c i p a t i n g countries on AIJV p r o d u c t s .
b)

upon

.

N o n - p a r t i c i p a t i n g c o u n t r i e s , which so

notification

participating

and

countries

concurrence of
at any

time and

desire

COIME,

may

and

become

shall ' extend

the

same m a r g i n of tariff p r e f e r e n c e for that AIJV p r o d u c t .

c)

under

Participating countries shall waive

their

rights

C h a p t e r II, A r t i c l e 8, p a r a g r a p h 2 of the

ASEAN

PTA

for

the first four years in r e s p e c t of e n t i t i e s

which

are

not

AIJVs

but

produce

count r i e s.

1 1

the

same

products

within

their

d)

A f t e r the waiver p e r i o d for an

entity

in

any

member country

which

AIJV p r o d u c t ,
produces

that

p r o d u c t , i r r e s p e c t i v e of whether it q u a l i f i e s as an

any
AIJV

AIJV or

n o t , shall enjoy t h e ' s a m e margin of t a r i f f p r e f e r e n c e in the

p a r t i c i p a t i n g c o u n t r i e s for that AIJV p r o d u c t .

9)

Existing

AIJV p r o d u c t s

shall

not

be

granted

exclusivity privileges.
Other

P r i v i l e g e s and Obligations A p p l i c a b l e to

Both New and E x i s t i n g P r o d u c t s

10)

If

manufacture
which

an

AIJV

product

is

of any p r o d u c t in the

a

component

for

participating

the

countries

have l o c a l - c o n t e n t p r o g r a m s , that AIJV p r o d u c t

shall

be g r a n t e d local-content a c c r e d i t a t i o n in such p a r t i c i p a t i n g

count r ie s.
11)

Protection

will

be

accorded

by -

participating

c o u n t r i e s in cases of d u m p i n g , unfair trade p r a c t i c e s or any
other
the

form of unreasonable pricing of p r o d u c t s
AIJV

p r o d u c t from sources

outside

the

similar

participating

c o u n t r i e s , which a f f e c t s the v i a b i l i t y of the AIJV
on

the b a s i s that

located

AIJV

will

be

project,

p r o j e c t s would be c o n s i d e r e d as if

in all p a r t i c i p a t i n g c o u n t r i e s .

implementation

to

negotiated

b'y

countries

shall

The mechanisms
the

of

par t ic ipat ing-

count r ie s .

12)
tariff

Participating
rates

applicable

not

to p r o d u c t s similar to

lower

the

the

AIJV

product

below the level p r e v a i l i n g at the time of

approval

for a four-year period from start of c ommerc ial o p e r a t i o n s .

13)

In r e s p e c t of any AUV p r o d u c t on which there is

prevailing
regarded

zero duty, the b i n d i n g of such a duty
as

fulfill ing the r e q u i r e m e n t

of

shall

extending

a

be
the

minimum 90% margin of p r e f e r e n c e .

ARTICLE IV
SUPERVISION AND REVIEW OF THE ASEAN
INDUSTRIAL JOINT VENTURE PROGRAMME

COIME

shall supervise the implement at ion of

Agreement and shall
implementation.

this

draw up rules and r e g u l a t i o n s for

All dec is ions of COIME shall be

such

taken

by

consensus.
ARTICLE V
REPEALING PROVISION

Upon
supersede
Ventures

the

its entry into force, t h i s
Basic

dated

Agreement on ASEAN

7th November

1983

and

Agreement

shall

Industrial

Joint

the

Supplementary

A g r e e m e n t s to the Basic Agreement on ASEAN Industrial
Ventures

dated

7th

November

1983 and

16th

Joint

June

1987

respectively .
ARTICLE

VI

MISCELLANEOUS AND FINAL PROVISIONS

1)

thirtieth
Instrument

This

Agreement

(30th)

day

shall enter

after

of R a t i f i c a t i o n .

13

the

into

deposit

force

of

the

on

the

Sixth

2)

.This Agreement may not be signed with

nor

shall

reservations

be

admitted

at

reservation

the

time

of

Rat ification.
3)

•

through

All

a r t i c l e s of this A g r e e m e n t

amendments

consensus.

All

to

this

amendments

Agreement
shall

may

be

agreed

become

modified
upon

by

effective

upon

acceptance by all Member Countries.

4)

This

Agreement

Secretary-General

promptly

of

furnish

the

s h a l l 1 be
' ASEA.N

deposited

with

the

S e c r e t a r i a t ' who

a certified copy t h e r e o f to

each

shall

Member

Count ry .

5)
of

Each Member Country shall d e p o s i t its
Ratification

with the S e c r e t a r y - G e n e r a l

of

Instrument
the

ASEAN

S e c r e t a r i a t who shall p r o m p t l y inform each Member Country of

such

depo sit.
IN

authorized

signed

'WITNESS WHEREOF, the .undersigned,
thereto

this

by their

respective

R e v i s e d Basic A g r e e m e n t

-on

being

duly

Governments

have

ASEAN

Industrial

Joint V e n t u r e s .

Done in M a n i l a , P h i l i p p i n e s this f i f t e e n t h day
December N i n e t e e n Hundred Eighty Seven in one o r i g i n a l
in the English Language.

14

of
copy

For the Government of
Brunei Darussalam:

H . R . H . P R I N C E ftoHAMED B O L K I A H
M i n i s t e r for Fo rk£L &n Af f a ir's

For the Government of the
Republic of Indonesia:

DR. MOCHTAR KUSUMA-ATMADJA
M i n i s t e r of Foreign A f f a i r s

For the Government of
Malay.s ia :

DATO ' HAJT

A K T T . _ _ H A S S AW . ET A.TT

1

OM

Minister of Foreign Affairs

For the Government of the
Republic of the Philippines:

RAUL S. MANGLAPUS
cretary of Foreign A f f a i r s
For the Government of the
R e p u b l i c of Singapore:

S. DHANABALAN
M i n i s t e r for Foreign A f f a i r s

: •{ -Uw" 4

For the Government of the
Kingdom of Thailand:

AIR CHIEF MARSHAL SIDDHI SAVETSILA

M i n i s t e r of F o r e i g n A f f a i r s

15