transnationa l corporation operating in its territory was recognized .. recognized that that must be coupled with a duty to pay compensation. assets of a It was Rlso The participants felt that it was not feasible to spell out elaborute and specific principles on the standard of compensation, and that a general and flexible standard would be adequate, particularly in view of the_provision on observance of international law/obligations (para. 49). Accordingly, it was considered that paragraph 57 of the Chairman's text of 1988 was acceptable. That provision reads: "It is acknowledged that States have the right to nationalize or expropriate the assets of a transnational corporation operating in their territory, and that appropriate compensation is to be paid by the State concerned, in accordance with the applicable legal rules and principles." It was pointed out that the phrase "applicable legal rules and principles" embraced international as well as municipal legal rules and principles. The point was made that the assets of a transnational corporation that muy be nationalized or expropriated must be in the territory of the nationalidng St.ate. However, that issue had been subject to different .judicial decisions in different circumstances and need not be dealt with specifically iu the code. 5. Dispute settlement The basic principles set forth in paragraph 59 of the Chairman· s teKt we1e found acceptable. Paragraph 59 provides: I ••• E/C.10/1990/5 English Page 32 "Disputes between States and entities of transnational corporations, which are not amicably settled between the parties, shall be submitted to competent national courts or authorities. Where the parties so agree, or have agreed, such disputes may be referred to other mutually acceptable dispute settlement procedures." The first part of the provision provoked little comment. As to the second part, there was some concern as to whether the provision for referring clisputes to 
**Analysis**
The text appears to be discussing the rights and obligations of states and transnational corporations, particularly in the context of nationalization or expropriation of assets. The focus is on the principles and standards for compensation and dispute settlement. This suggests that the text is related to international economic law and the governance of global economic activities.

**Category**
International trade, Industry