The ASEAN Comprehensive Investment Agreement (ACIA) entered into force on 29 March 2012, with the aim to create a free and open investment regime to ensure that ASEAN remains an attractive destination for all investors (both domestic investments and foreign direct investment (FDI).

In replacing the earlier Framework Agreement on the ASEAN Investment Area (AIA) and the ASEAN Agreement on the Promotion and Protection of Investments (IGA), the more comprehensive ACIA further enhances ASEAN’s effectiveness in attracting investments in the light of the challenges and objectives of the ASEAN Economic Community (AEC).  ACIA is also based on international best practices.

The main principles of the agreement include:

i) cover the four elements of investment liberalisation, protection, facilitation and promotion;

ii) progressive liberalisation towards achieving a free and open investment environment, in line with AEC, covering manufacturing, agriculture, fishery, forestry, mining and quarrying, and services incidental to the specified sectors;

iii) benefits to be enjoyed by both ASEAN investors and ASEAN-based foreign investors;

iv) new and improved provisions on Senior Management and Board of Directors (SMBD), Prohibition of Performance Requirements (PPR), Treatment of Investment, Expropriation and Compensation, Investor-State Dispute Settlement (ISDS) and Denial of Benefits of ACIA to investors with no substantive business operations (e.g. shell companies) in ASEAN;

v) ACIA benefits extended to portfolio investment which was not included in the AIA;

vi) special and differential treatment and other flexibilities to assist newer ASEAN member countries to develop capacity; and

vii) preservation of preferential treatment among ASEAN member countries.

ACIA covers Manufacturing & Related Services, Agriculture, Fishery, Forestry and Mining & Quarrying and the details as follows: