On 18 November 1999, an international agreement was signed between Turkey, Azerbaijan and Georgia (government agreement, IGA). This requires the three states to cooperate and coordinate the implementation of uniform standards for the construction and operation of the pipeline. The agreement stipulates that minimum standards should be “international standards and practices within the oil industry,” as is the case in EU Member States. It is binding on all three countries. Once the BTC project is underway, only the BTC consortium has the authority to terminate HGA (except in exceptional cases). As a result, national governments cannot regulate or control the construction or operation of the pipeline. Any future national government would not be able to invoke its executive powers to amend the agreement to provide greater protection to its citizens. The Green Alternative will emphasize that the routing decision also violates the legal rights of Georgian citizens, who consider that appropriate access to information and appropriate participation in the decision-making process (in accordance with Article 37 of the Georgian Constitution), the Aarhuus Convention and the actual host government agreement signed by the Georgian government and BTC Co. Under the HGA, national governments have also effectively granted the consortium an exemption from the financial impact of new environmental, social or other laws relating to the pipeline that they can introduce over the next 40 years, namely the duration of the host government`s agreements.
They also pledged to compensate the BTC consortium if new taxes or health, safety or environmental laws affect the project`s finances. (These exemptions and compensatory provisions are called stabilization clauses.) Although the OECD guidelines are themselves voluntary, Lord Sainsbury, then Under-Secretary of State for Trade and Industry, confirmed in a statement to the British Parliament on 12 January 2005 that these additional agreements were legally binding on the company: “BTC Co is contractually obliged to comply with the guidelines”. BTC Co. has also signed security protocols with the governments of Azerbaijan and Georgia. Three separate private law contracts were signed between the BTC consortium and the government of each country (host government agreement, HGA): Azerbaijan (17 October 2000), Georgia (28 April 2000) and Turkey (19 October 2000). The agreements define the capital and means that each signatory must make available to the project, the timetable under which it must be developed and the standards it must meet.