SEOUL, KOREA - The tripartite investment guarantee pact among the three summits of East Asia signed in May 2012 will officially go into effect in May. Although the agreement was signed on May 13, 2012 in the summit meeting held in Beijing, its passage has been delayed for almost two years due to lack of ratification in each of the signing countries.

 

Japan and Korea have completed the ratification process in December and August last year, awaiting the same in China. The Chinese government recently passed the proposal with the State Council and notified it to the counterparts in Korea and Japan. According to the procedure agreed among the participating countries, the investment protection treaty will go into effect after one month from the date of the final domestic ratification on April 17.

 

The first accord of its kind among the East Asian nations is expected to encourage mutual investment in the three countries. Korean companies have high hopes that the latest pact would contribute in important ways for them to increasing investment in China.

 

The tripartite investment guarantee agreement differs from the existing Korea-China pact in that the former strengthens protection of intellectual property rights, applies rules of the World Trade Organization in limiting national foreign investment regulations, limits exceptions of giving priorities to domestic citizens, and creates a new provision on national government's autonomous policy making.