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Bilateral agreements

1. Agreement for the Avoidance of Double Taxation will play significant role in the development of bilateral relations.

          The respective Agreement was already signed on the expert level in September 2006. The first round of negotiations was successfully accomplished in Damascus in July 2001, but one point - the percentage of the revenue of permit rights concerning licence fees - remained unsolved till September 2006. The respective Agreement should enter into the force next year 2007.

2. Agreement for the promotion and reciprocal protection of investments

          The draft has been negotiated since April 2001, the pending point was the issue of repatriation of invested capital which is, according the Syrian law, allowed only in case of generating 75% of the transferred free currency proceeds by exporting.

          Situation has changed after the accession of the Czech Republic to the EU. As a member of the European Union, the Czech Republic is bound, according to Article 307 of the Treaty establishing the European Community, to harmonize all its international legal commitments with EC/EU legislation. Consultations between the Czech Republic and the European Commission have shown that, as a member of the EU, the Czech Republic must include in its bilateral investment agreements a provision to limit, under exceptional conditions, free transfer of funds in order to protect the balance of payments of the EU and a provision to protect essential security interests of the EU. The consultations have also shown that the provision regulating national and most favored nation treatment should be amended as well.

          The text of the Agreement under negotiation was found incompatible with the EC/EU legislation hence a new draft of the Agreement compatible with the EC/EU legislation was submited to the Syrian side at the end of the year 2005, as a basis for further negotiation.