(1) In case of any dispute between Nepali investors and foreign investors regarding foreign investment, the concerned parties may make necessary facilitations to resolve such disputes through mutual discussion or negotiation.
(2) If the dispute cannot be resolved through the procedure under subsection (1) within forty-five days of the dispute arising, and if there is a joint investment or dispute settlement agreement between the parties to the dispute to resolve such dispute, the dispute shall be resolved according to such agreement.
(3) According to sub-section (2), the parties shall inform the foreign investment approval authority within fifteen days of the settlement of such dispute. But the parties will not be obliged to inform about the conditions under which such agreement has been reached.
(4) If there is no provision regarding dispute resolution in the agreement between the parties as per sub-section (2), such dispute shall be resolved by arbitration in accordance with the law on arbitration of Nepal.
(5) Disputes arising in relation to any foreign investment shall be resolved by arbitration in accordance with the prevailing rules or procedures of the United Nations Federal Commission on International Trade Law (UNCITRAL), unless otherwise agreed by the parties to the dispute.
(6) The arbitration conducted under this section shall be held in Nepal and the substantive law of Nepal relating to arbitration shall be applicable. But in the case of sub-section (2) it will be as per the same sub-section.
(7) If there is no agreement regarding dispute resolution between the parties before the dispute arises or if the agreement is felt to be insufficient, then even after the dispute arises, the related parties may enter into an agreement for the settlement of the dispute. The information of the agreement made in this way should be given to the industry registration body.
(8) Disputes can be resolved in accordance with this section even in the case of an agreement made under sub-section (7).