AGREEMENT SPECIFYING THE SPECIAL STATUS OF THE PROPARCO IN THE REPUBLIC OF VANUATU BETWEEN THE GOVERNMENT OF THE REPUBLIC OF VANUATU AND THE SOCIETE DE PROMOTION ET DE PARTICIPATION POUR LA COOPERATION ECONOMIQUE
(Port Vila, 15 June 1992)
ENTRY INTO FORCE: UPON GAZETTING

The Government of the REPUBLIC OF VANUATU represented by Honourable Mr Sethy John REGENVANU, Deputy Prime Minister, of the one part,
And 
The SOCIETE DE PROMOTION ET DE PARTICIPATION POUR LA COOPERATION ECONOMIQUE (herein after referred to as "PROPARCO") represented by Mister Philippe JURGENSEN, Chairman of the other part,

IT IS HEREBY BET OUT AS FOLLOWS
- PROPARCO is a French financing company that aims at providing, within the framework of the French development aid, its financial and technical assistance to the economic development of the countries in which it intervenes, as is the case with the Republic of VANUATU.
- This assistance is given in the form of equity participation in the capital of a company, quasi-equity interventions, loans and consultancy for the enhancement of private sector investment.
- PROPARCO is a subsidiary of the CAISSE CENTRALE DE COOPERATION ECONOMIQUE, a French state-owned institution contributing to the development, which is a major shareholder in its capital and which enjoys a special status in the Republic of VANUATU.
- PROPARCO is represented in the Republic of VANUATU by the CAISSE CENTRALE DE COOPERATION ECONOMIQUE resident mission in Port-Vila.
- PROPARCO has taken back the lending activity of the CAISSE CENTRALE DE COOPERATION ECONOMIQUE to the banking and private sectors.
- PROPARCO enjoys subsidized resources from the French State for its lending activities,

AFTER THIS PRESENTATION, THE SIGNATORY PARTIES COVENANT AS FOLLOWS:
Article 1
The aim of this agreement is to define the special status of PROPARCO in the Republic of VANUATU.
Article 2
PROPARCO has full legal authority to operate in the territory of the Republic of VANUATU.
Article 3
PROPARCO is authorized to grant credits or guarantees to banks, financial institutions VANUATU freely.
PROPARCO is not subject to the regulations applicable to banks and other financial institutions in the Republic of VANUATU.
In particular, PROPARCO, as well as the CAISSE CENTRALE D COOPERATION ECONOMIQUE in its role as the representative of PROPARCO within the Republic of VANUATU, are exempted from all declaration obligations in relation to the above-mentioned regulations.
However, PROPARCO could provide the said information for the purpose of balance of payments records and the centralisation of banking risks.
Consequently, PROPARCO and the CAISSE CENTRALE DE COOPERATION ECONOMIQUE, in its role as the representative of PROPARCO, shall have access to information pertaining to the centralisation of banking risks.
In the case of the setting-up of a credit ceiling system, the said system shall not be applicable to loans granted by PROPARCO and to loans granted by banks that are refinanced by PROPARCO.
Article 4
PROPARCO is authorized to freely transfer all amounts corresponding to the interests and incomes received by the company, as well as amounts corresponding to loan reimbursements or to the sale of its shares, and all amounts derived from operations related to PROPARCO's principal and affiliated activities (including consultancy).
The corresponding transfer operations are exonerated from all fees and taxes.
Article 5
PROPARCO is exempted from all duties, direct or indirect taxes, or other levies of any kind in respect of its operations on the territory of the Republic of VANUATU.
PROPARCO, as well as the CAISSE CENTRALE DE COOPERATION ECONOMIQUE in its role as the representative of PROPARCO, are also exempted from all fiscal and parafiscal declaration obligations towards the Vanuatuan authorities.
This exemption is applicable to the income derived from the assistance PROPARCO may grant in the form of equity participations, quasi-equity interventions (such as bonds convertible into shares, shareholder advances, equity or subordinated loans...), loans, guarantees released as well as consultancy services and possible profits derived from the sale of its shareholdings.
This exemption is also applicable to the legal acts and deeds in relation to PROPARCO's activities, to the taking or releasing of bank, personal and all other types of guarantee, to the purchase or sale of shareholdings or bonds convertible into shares, to loans commitments and outstanding credits it may grant and to its income from its role as a Director.
It is to be noted that the above-mentioned list is of an indicative nature and it is not limited to the items mentioned. Also, exemptions are applicable, depending on the case, either to PROPARCO or to the beneficiaries of PROPARCO's interventions.
This extension of exemptions to the beneficiaries is only applicable to the financial interventions granted by PROPARCO in the form of equity participations, quasi-equity interventions, loans granted directly or through a bank or a financial institution, to guarantees released as well to its consultancy services.
PROPARCO is exempted from the payment of any licence. Its potential profits are also exempted from all duties, direct or indirect taxes or levies in the Republic of VANUATU.
Article 6
PROPARCO is authorized to freely purchase equity participations from any Vanuatuan or foreign seller or to freely sell its equity participations to any Vanuatuan or foreign buyer, without prior authorisation or notice.
The Republic of VANUATU guarantees all PROPARCO's participations to the level of their nominal value against possible exchange fluctuations that may occur as of the date of initial input, in the case of the amounts being reinvested in other companies of the Republic of VANUATU.
The reinvested amounts shall be considered as foreign exchange input at the initial rate but they shall no longer be eligible for an exchange guarantee. However, the corresponding amounts shall be freely transferable. This shall equally apply to bonds converted into shares.
Article 7
The Government of the Republic of VANUATU shall grant all the necessary permissions to enable PROPARCO to undertake missions in the Republic of VANUATU freely and without impediment.
Article 8
Complementary agreements may be reached by both parties if needed by the interpretation of this text or by its methods of implementation.
Article 9
This agreement shall come into effect after notification by the Parliament of Vanuatu. Both its English and French versions will be considered true copies.
Drawn up in four original copies of which two are in French language and two in English language.
Port-Vila, June the 15th 1992
For the Government of the Republic of VANUATU

Seen and approved
	For PROPARCO

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MEMORANDUM OF UNDERSTANDING

MEMORANDUM OF UNDERSTANDING BETWEEN THE GOVERNMENT OF THE REPUBLIC OF VANUATU (hereinafter referred to as "the Government") of the one part and the SOCIETE DE PROMOTION ET DE PARTICIPATION POUR COOPERATION ECONOMIQUE (hereinafter referred to as "PROPARCO") of the other part.

WHEREAS
(a) The Government and PROPARCO signed the Agreement Specifying The Special Status of The PROPARCO In The Republic Of Vanuatu in Port Vila On the 15th Day of June, 1992;

(b) The parties to that Agreement are desirous of making certain changes to the Agreement to further enhance their understanding and implementation of the Agreement.
NOW THEREFORE the Parties agree that the provisions of the Agreement dated 15th June, 1992, may be modified at any time within a delay of 4 months by written agreement between the parties thereto.
IN WITNESS WHEREOF the undersigned, duly appointed representatives of PROPARCO and of the Government, respectively, have on behalf of the parties signed the present Memorandum in the English language and in the French language in two copies each at
Port-Vila, the 15th day of June, 1992.
Philippe JURGENSEN
[Signed]
Chairman
FOR PROPARCO
	Sethy John REGENVANU
[Signed]
Deputy Prime Minister
FOR THE GOVERNMENT OF THE REPUBLIC OF VANUATU