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February 21, 1997

1.1 This MEMORANDUM expresses the understandings of the Government of the Republic of the Philippines and the Government of Australia concerning the responsibilities and contributions respectively of the two Governments with regard to the implementation of the ACIAR Project No. FST/95/00 Manufacture of low-cost wood-cement composites in the Philippines using plantation grown Australian tree species.

1.2 The project aims to improve the suitability of Acacia mangium for the manufacture of wood-wool-cement boards and whether manipulation of storage time can improve the suitability of A. mangium for wood-wool-cement boards. The project is further described in Attachment 1 of this Memorandum of Understanding.

In This Memorandum:

"Australian institutions, firms and organisations" means Australian institutions, firms or organisations engaged in the project;

"Australian personnel" means Australian nationals or permanent residents or other persons who are not nationals or permanent residents of the Philippines, who are working in the Philippines on the project and whose salaries or other costs are funded from the contribution of the Government of Australia to the project;

"dependant/dependent" means the spouse or unmarried minor children of a member of the Australian personnel or any other person recognised by the two Governments as a dependant/dependent of a member of the Australian personnel;

"professional and technical material" means equipment, motor vehicles, and other goods imported by members of the Australian personnel or Australian institutions, firms and organisations for their professional use in carrying out their assigned duties under the project and paid for from funds provided by the Government of Australia;

"project supplies" means equipment, material and other goods supplied for the execution of the project, the cost of which is funded from the contribution of the Government of Australia to the project;

"services" means services performed by individuals or by general professional partnerships registered in the Philippines as detailed in Attachment 1;

"personal and household effects" means equipment, motor vehicles and other goods imported by Australian personnel or Australian institutions, firms and organisations for the personal use of personnel and their dependents while engaged in the project.

3.1 Each Government will implement the research project through respective Coordinating authories.

3.2 The Department of Foreign Affairs, hereinafter referred to as the DFA, will be the Philippine-Co-ordinating Authority. The Australian Centre for International Agricultural Research, hereinafter referred to as ACIAR, will be the Australian Coordinating Authority.

3.3 Under the terms of this Memorandum of Understanding, the DFA nominates the Forest Products Research and Development Institute, hereinafter referred to as FPRDI to carry out the project on its behalf, and ACIAR nominates the Australian National University, hereinafter referred to as ANU, to carry out the project on its behalf, as described and detailed in Attachment 1.

4.1 The contributions of the Government of the Republic of the Philippines and the Government of Australia as described in Attachment 1 are estimated to value Eight Thousand One Hundred Dollars (AUD$8,100.00) and One Hundred and Nine Thousand and Thirty Four Dollars (AUD$109,034.00) respectively. The financial contribution of the Government of the Republic of the Philippines will be subject to its annual Congressional appropriations. The financial contribution of the Government of Australia will be subject to the normal annual parliamentary approval of appropriations.

4.2 Further to be estimated contributions above, additional funds will be provided by the Government of the Republic of the Philippines for payment of taxes incurred through implementation of the project.

5.1 The Government of the Republic of the Philippines and the Government of Australia will provide personnel processing the competence required for the project, including Philippine and Australian project leaders. The project leaders will have responsibility for effective implementation in their respective countries.

5.2 Personnel composition in FPRDI and ANU are as described in Attachment 1.

6.1 Project implementation will follow the schedule specified in Attachment 1. The project leaders will provide a yearly progress report to ACIAR, copies of which will be forwarded to the DFA.

6.2 The Philippine and Australian project leaders will establish regular consultations on project progress, direction and schedules.

6.3 Philippine project leaders will join the yearly co-ordination meeting of all project leaders from the two countries involved in the project

6.4 The project will be reviewed approximately six months prior to its conclusion. The main reviewer(s) (1 or 2) will be an independent acknowledged eminent scientist(s) of any nationality, specifically contracted by ACIAR for the purpose. The reviewers will be joined by the relevant ACIAR program co-ordinator, and a representative from the DFA during the review process in the Philippines. They will participate in the deliberations.

7.1 In respect of project supplies, motor vehicles, professional and technical material and services whether to be imported into and/or procured within the Philippines for the purposes of the project, the Government of the Republic of the Philippines will:

(a) be responsible of the payment of import duties, Value Added Tax (VAT), and other duties and taxes imposed in the Philippines and be responsible for inspection fees, storage charges and all other levies, fees and charges;

(b) facilitate the expeditious clearance and release of imported project supplies and motor vehicles including the provision of appropriate customs and wharfage facilities in the port of entry closest to the site of the project; and

(c) unless mutually arranged otherwise, provide expeditious internal transport to the site of the project.

7.2 Project supplies and motor vehicles provided by the Government of Australia for the project will be available for the unrestricted use of the project and will not be withdrawn from that use without the consent of the Government of Australia.

7.3 Motor vehicles provided by the Government of Australia for the purposes of the project will be registered as Official Exempt Vehicles and handed over at the completion of the project to the agency or another project as mutually agreed between ACIAR and FPRDI. These vehicles will be under the administrative control of the Philippine project leader for the duration of the project.

In respect of the importation into the Philippines of bona fide personal and household effects, including motor vehicles, for the personal use of Australian personnel or their dependants/dependents, which accompany such persons or arrive within six months from either the date of their first arrival in the Philippines, or the signing of this Memorandum whichever is the later, the Government of the Republic of the Philippines will:

(a) be responsible for the payment of all customs duties, other duties, taxes, levies, and other charges of similar nature; and

(b) expedite their clearance through customs.

In respect of the export from the Philippines at the end of the assignment of Australian personnel, of professional and technical material, personal and household effects and motor vehicles for personal use, the Government of the Republic of the Philippines will:

(a) be responsible for the payment of all customs duties, levies and other charges of similar nature; and

(b) expedite clearance through customs and other export controls.

The Philippine Co-ordinating Authority and the Philippine Implementing Agency(s) will exert their best efforts to inform and keep advised Australian firms, institutions and organizations of local laws and regulations which may concern them in the performance of their duties.

The Government of the Republic of the Philippines will deal with any claim which may be brought by third parties against Australian personnel and Australian firms, institutions and organizations and will hold harmless said Australian personnel and Australian firms, institutions and organizations from civil liability from acts or omissions occurring in the course of the performance of their duties in the execution of the project except where both Governments accept that their acts arise from gross negligence and willful misconduct.

The Government of the Republic of the Philippines will provide security arrangement for Australian personnel and their dependents and property on project sites and elsewhere when they are involved in official activities in accordance with the present Memorandum. The nature of such security arrangements will be mutually determined by the two Governments.

Amendments to this Memorandum may be made at any time by written arrangement between the parties.

This Memorandum will take effect from the date of its signature. The contribution of the Government of Australia to the Project and all undertakings given will cease on 31 December 1999 or on such other date as may subsequently be arranged between the two Governments.

Attachments referred to in and attached to this Memorandum form an integral part of it.

SIGNED at the City of Manila, this 21st day of February 1997.