The term may be extended by agreement of the parties on period, terms, and conditions prior to the expiration of the term. The parties shall meet not later than 15 years prior to the expiration of the term to agree on an extension of the term and the terms and conditions of any such extension.
The term of the contract is 99 years from the effective date for the investor (the later of the date on which: (i) the contract was signed by both parties; (ii) the first lease agreement becomes effective; and (iii) the port agreement becomes effective). The term may be extended for delay due to force majeure.
The Government warrants that no hazardous materials are present within any State Land in the Production Area, and to the best of the Government's knowledge, within any Private Land in the Production Area, in any form that could result in a remedial obligation or other liability under any applicable law
SG Sustainable Oils Cameroon's obligations with respect to the environment shall be as prescribed by applicable law, including the Environmental Code, and the Equator Principles as applicable
SG Sustainable Oils Cameroon has the exclusive right to take and use free of charge (but not to sell to any other person without the Government's written approval) such water as it considers necessary or useful for its activities under the contract. This right is subject to any limitations related to SG Sustainable Oils Cameroon's environmental obligations.
SG Sustainable Oils Cameroon is totally exempt from all existing and future taxes and duties payable on imports and exports, and the Import Verification Programme (IVP) does not apply. Notwithstanding this exemption, SG Sustainable Oils Cameroon shall be required to pay taxes and duties on imports of passenger cars for private use (but not for vehicles used during production) and fuel, to the extent required by applicable law.
SG Sustainable Oils Cameroon is totally exempt from all existing and future taxes and duties for 10 years from the Initial Production Date of the production area. It is also totally exempt for 10 years from the Initial Production Date of any private or state land that becomes part of the production area. At the end of each 10-year period, SG Sustainable Oils Cameroon remains exempt, except for a flat rate tax on taxable profits.
Total net losses incurred in the first 10 years following the initial production date (of the production area or any other area brought into production) shall be considered expenses for subsequent years, and to the extent not used to offset taxable profits in the previous year, such total net losses may be used to offset taxable profits in subsequent years indefinitely. After such 10-year period, any prior year losses not used to offset taxable profits in a previous year may be used to offset taxable profits in subsequent years indefinitely.
After any 10-year exempt periods that start from the Initial Production Date, SG Sustainable Oils Cameroon will be taxed on taxable profits at a flat rate not to exceed 15%
The sale, lease, sublease or other transfer of any or all of the production area by SG Sustainable Oils Cameroon is exempt from any existing or future taxes and duties. No rent or tenancy controls apply to the production area. The purchase, lease, sublease or other transfer of private land or state land by or to SG Sustainable Oils Cameroon is also exempt from all existing and future taxes. Any sales of raw materials, intermediate, semi-finished, and finished goods by Cameroonian persons to SG Sustainable Oils Cameroon shall be exempt from internal turnover tax, the single tax, the internal tax on production, and any other existing or future duties, taxes and imposts of the same nature. If the Government enacts any taxes and duties, enters into any agreement or adopts any other practice or policy that permits more favorable treatment of any other person (human or legal entity, including government entity) than that accorded to SG Sustainable Oils Cameroon by this contract with respect to taxes and duties or otherwise, in any way related to the production or processing of agricultural products in Cameroon, the Government shall grant the same more favorable treatment to SG Sustainable Oils Cameroon with effect from the date of its application to such other person or of its entry into force.
To the extent that SG Sustainable Oils Cameroon realizes certified emission reduction credits or other carbon or carbon-equivalent emission reduction credits (whether created by SG Sustainable Oils Cameroon, a person supplying goods or services to SG Sustainable Oils Cameroon or its affiliates in connection with its activities under the contract, a Project Participant, or a third party acting under the direction of SG Sustainable Oils Cameroon), SG Sustainable Oils Cameroon alone shall be entitled to all such credits and corresponding cost savings.
Starting on the contract's effective date for SG Sustainable Oils Cameroon, SG Sustainable Oils Cameroon shall pay annual surface rent of US$ 1.00 per hectare for state land that is Developed Land (in the production area and yielding an annual harvest of not less than 10 tons of FFB per hectare), and US$ 0.50 per hectare for State Land that is not Developed Land. Surface rent shall be increased each year at a rate of 2% per calendar year.
SG Sustainable Oils Cameroon shall give preference for employment to qualified Cameroonian nationals. Subject to the availability of qualified applicants, SG Sustainable Oils Cameroon shall cause Cameroonian nationals to represent at least 80% of the overall work force within 5 years from the Effective Date for SG Sustainable Oils Cameroon. Subject to the availability of qualified applicants, SG Sustainable Oils Cameroon shall use reasonable efforts to cause Cameroonian nationals to represent at least 80% of the professional work force, including senior staff positions, where the following conditions are fulfilled: (i) the legitimate interests of SG Sustainable Oils Cameroon are guaranteed; (ii) the level of productivity required by SG Sustainable Oils Cameroon is maintained; and (iii) the labor market offers Cameroonian nationals with profiles that meet the relevant job descriptions. However, where SG Sustainable Oils Cameroon only requires a few key professional positions, which require significant experience that can only be acquired over a period in excess of 5 years, or the attributes of the position guarantee actual control of SG Sustainable Oils Cameroon, legitimate interests of SG Sustainable Oils Cameroon shall be given precedence. In addition, SG Sustainable Oils Cameroon shall pay compensation or wages to employees based on the occupational categories and minimum wage scales fixed on the basis of productivity and efficiency criteria. The terms and conditions of such compensation, benefits, and working conditions shall be in accordance with international standards.
Protections or benefits for employees, dependents, or others
SG Sustainable Oils Cameroon shall practice modern public health in accordance with generally accepted health and sanitation procedures and in conformity with Cameroonian laws. It shall install, maintain and use modern health and safety devices, work gears and equipment, and shall practice modern health and safety procedures and precautions in accordance with applicable law and international standards, including regular safety training for its employees, in connection with all of its activities conducted under this contract.
SG Sustainable Oils Cameroon is exempt from any withholdings, deductions and contributions prescribed by social security laws, except for contributions to the National Social Insurance Fund, provided that: (i) SG Sustainable Oils Cameroon has requested and received written certification from the governmental authority responsible for social security; (ii) SG Sustainable Oils Cameroon offers conditions at least equivalent to the best benefits provided by the Government; and (iii) the Government commits to providing benefits to any employee of SG Sustainable Oils Cameroon in the event that such employee, having been laid off, would no longer receive such benefits from SG Sustainable Oils Cameroon. The Government undertakes to provide the foregoing certification to SG Sustainable Oils Cameroon as required by the contract.
The Government has the right to construct roadways, highways, railroads, telegraph and telephone lines and other lines of communication within the production area provided that this does not interfere with SG Sustainable Oils Cameroon Activities. SG Sustainable Oils Cameroon may use any airport, harbor, port, road, rail, public transportation or similar facility or service owned or operated by the Government or any governmental entity at the most favorable preferential rates or charges then in effect.
All highways and roadways in the Production Area (including farm roads) shall remain open to the public subject to reasonable and lawful restrictions as SG Sustainable Oils Cameroon shall impose: (i) in the interest of safety and security of the property and assets of Project Participants, and (ii) to assure that such use does not materially interfere with SG Sustainable Oils Cameroon's activities under the contract. SG Sustainable Oils Cameroon has the right to place security gates on highways and roadways within the Production Area for as long as it deems necessary.
The Government authorizes SG Sustainable Oils Cameroon to establish, manage and maintain its own asset and employee security and protection service for the purpose of maintaining law, order and security in the production area and other areas where SG Sustainable Oils Cameroon has or maintains property or assets, subject to applicable law. The service shall have the power to search, apprehend, detain, exclude and evict unauthorized persons from the production area and other areas that may be properly restricted for economic, operational or security reasons, subject to applicable law. SG Sustainable Oils Cameroon shall coordinate these activities with the police. In addition, the Government shall, when asked by SG Sustainable Oils Cameroon, exert all lawful and reasonable efforts to enforce relevant laws relating to threatened or actual loss or damage caused by third parties to the land rights, production area or loss or injury to persons within the project area involved in production in order to avoid or mitigate harm to production or the production area, except when it is reasonable for SG Sustainable Oils Cameroon to deal with such threatened or actual instances of loss or damage by enforcing their contractual rights contained outside of this contract.
Any dispute between the Government and SG Sustainable Oils Cameroon arising out of, in relation to or in connection with the contract shall be settled by binding arbitration under the rules of the International Centre for Settlement of Investment Disputes (ICSID), but when the rules of ICSID conflict with Article 19 of the contract, Article 19 will prevail. SG Sustainable Oils Cameroon shall be treated as a national of the United States of America for the purposes of the arbitration. Arbitration proceedings will be held in English, in London, England, or such other place as the parties may agree.
SG Sustainable Oils Cameroon has the right to assign or transfer any or all of its interest in the Production Area and its rights and obligations under the contract to or in favor of in person (human or legal entity). Any such assignment or transfer shall be effective upon SG Sustainable Oils Cameroon providing notice to the Government. The Government shall not assign or transfer any of its rights and obligations under the contract unless SG Sustainable Oils Cameroon has given its prior written approval to the assignment or transfer.
SG Sustainable Oils Cameroon has the right to terminate without cause the contract at any time, either in its entirety or regarding any part of the production area, 30 days after giving notice to the Government. The termination will be subject to SG Sustainable Oils Cameroon's prior obligations. SG Sustainable Oils Cameroon can also terminate if a "Government Event of Default" (defined in the contract) occurs and is continuing, so long as the event does not result from an investor event of default of the occurrence of force majeure. The Government can terminate the contract if any of the following events occur and are continuing, so long as the event does not result from a government breach, government event of default, or the occurrence of force majeure: (a) SG Sustainable Oils Cameroon materially breaches the contract, which has a materially adverse effect on the Government; or (b) SG Sustainable Oils Cameroon (i) files a petition to any tribunal for the appointment of a trustee or receiver for all or any substantial part of its assets; (ii) commences proceedings for its bankruptcy, reorganization, arrangement or insolvency or if any such petition is filed, or any such proceedings commenced against it, and indicates its approval and such proceedings are not dismissed within 90 days; or (iii) if any order is entered appointing any such trustee or receiver, or adjudicating that SG Sustainable Oils Cameroon is bankrupt or insolvent, or approving the petition in any such proceedings, permits such order to remain in effect for more than 90 days.
Confidential information shall only be used by the receiving party and its representatives for the purpose for which it was obtained, and shall be maintained in confidence as to third parties by the receiving party except as required by law, this contract, or any final order of a court with jurisdiction that is not subject to appeal. Confidential information (defined in the contract - exceptions are also listed) does not include information already in the public domain (unless it became public because of a breach of confidentiality or an illegal act).
The Government undertakes that it shall not nationalize or expropriate (or take any measure equivalent to nationalization or expropriation): (a) any moveable or immoveable infrastructure or other property of any Project Participant (Interest Holder, Lender, or Investor Party) or their respective employees, officers, directors, agents or representatives, to the extent connected with or affecting the activities of any Project Participant; (b) oil palm products, by-products or derivative products and other agriculture products in any form resulting from the activities of any Project Participant; (c) any equity, shares or ownership interests held in or owned or issued by any Project Participant; (d) any structure or entity put in place by a Project Participant in connection with production; and (e) any capital invested by any Project Participant in Cameroon. This does not prohibit the Government from taking title to movable or immovable assets of SG Sustainable Oils Cameroon upon termination of the contract as provided in Section 18.6 (which gives SG Sustainable Oils Cameroon the option to require the Government to purchase moveable and immoveable assets in the production area when the contract is terminated because of a Government Event of Default) and Section 18.8 (which describes procedures upon termination).
The contract and the rights, obligations and duties of the parties to it is to be construed and interpreted in accordance with Cameroonian law (which includes judicial decisions and executive orders) and by applicable rules and principles of international law, particularly regarding investment by nationals of one country in another country. However, in the event of a conflict between the contract and any law, except the Constitution of Cameroon, as in effect as of the contract date, the rights, obligations and duties of each party are deemed to be those as set out in the contract.
In the event of either party to the contract being rendered unable by force majeure to carry out any obligation under the contract, other than an obligation to make payments of money, such party shall give notice in writing to the other party as soon as practicable after the occurrence of the cause relied upon. The affected obligation of the party giving notice is suspended during the continuance of any such inability. However, any such inability shall, as far as practicable, be remedied with all reasonable dispatch. All time periods in the contract for obligations that are affected by force majeure, except obligations for the payment of money, but including the term of the contract, are extended by the period of time the inability caused by such force majeure exists. If a force majeure exists continuously for 365 or more days and prevents production or any material activities by SG Sustainable Oils Cameroon, SG Sustainable Oils Cameroon has the right to terminate the contract without further obligations, cost or expense (except for any obligations accrued before the force majeure or obligations regarding the payment of money that accrued prior to termination) by delivering notice to the Government not less than 30 days prior to such termination.
To the extent not inconsistent with this contract, the Government affirms that each Project Participant and respective employees, officers and directors shall enjoy the full benefits of the investment treaty between the United States and Cameroon (1986)
SG Sustainable Oils Cameroon (“SGSOC”) is exempt from all existing and future taxes and duties for 10 years from the “initial production date” (the date on which SGSOC first achieves a harvest of not less than an average of 10 tons of fresh fruit bunches (FFB) per hectare on at least 3,000 planted hectares). At the end of each 10-year period after that, SGSOC is exempt from all taxes and duties, except for a flat rate tax not to exceed 15% on taxable profits. Total net losses incurred in the first 10 years from the initial production date shall be considered expenses for subsequent years, and if not used to offset taxable profits in the previous year, such total net losses may be used to offset taxable profits in subsequent years indefinitely.
Any sales of raw materials, intermediate, semi-finished, and finished goods by Cameroonian persons to SGSOC shall be exempt from internal turnover tax, the single tax, the internal tax on production, and any other existing or future duties, taxes and imposts of the same nature. The sale, lease, or other transfer of any land that is part or becomes part of the production area by SGSOC is exempt from any existing or future taxes and duties.
If the government enacts any taxes and duties, enters into any agreement or adopts any other practice or policy that permits more favorable treatment of any other person than that accorded to SGSOC by this contract, the government shall grant the same more favorable treatment to SGSOC with effect from the date of its application to the other person or the date it enters into force.
If any change of law impairs, conflicts or interferes with SGSOC's activities, value of the production area or any of the rights under the contract, or imposes any direct or indirect costs on SGSOC or another interest holder, SGSOC shall give notice in writing to the government within 1 year from the date on which it could have reasonably become aware of such adverse effect or loss. The government and SGSOC shall attempt to resolve the dispute through negotiation within 90 days. If no resolution is found, the government shall: (i) take all actions available to it to reverse the effect of the change of such law; or (ii) compensate SGSOC for any relevant present and future loss incurred as a result of the change of law. However, the government does not have to take one of these actions if the change in law reflects a change in standards generally applicable in relation to the protection of the environment, safety, employment, training, social impact or security in the oil palm industry internationally.