WORLD TRADE  
ORGANIZATION  WT/REG160/1 
22 January 2004  
 
(04-0183) 
Committee on Regional Trade Agreements Original:   English 
   
FREE TRADE AGREEMENT BETWEEN THE UNITED  STATES AND CHILE
* 
 
  The following text is being circulated at the re quest of the Delegations of the United States of 
America and of the Government of the Republic of Chile.  
_______________ 
 
 
UNITED STATES – CHILE FREE TRADE AGREEMENT
 
 
 
 The Government of the United States of America  and the Government of the Republic of 
Chile , resolved to: 
   Strengthen the special bonds of friendship and cooperation between their nations; 
 
 Contribute to the harmonious development and e xpansion of world trade and provide a 
catalyst to broader international cooperation;   Create an expanded and secure market for the goods  and services produced in their territories; 
 
 Avoid distortions in their reciprocal trade; 
  Establish clear and mutually advantageous rules governing their trade; 
  Ensure a predictable commercial framework for business planning and investment; 
 
 Build on their respective rights and obligations under the Marrakech Agreement  establishing 
the World Trade Organization  and other multilateral and bilate ral instruments of cooperation; 
  Enhance the competitiveness of their firms in global markets; 
 
 Foster creativity and innovation, and promote trade in goods and services that are the subject 
of intellectual property rights;   Create new employment opportunities and improve working conditions and living standards 
in their respective territories; 
 
 Build on their respective international commitments  and strengthen their cooperation on labor 
matters;  
                                                     
 
* The full text of the USCFTA is also available, along with tariff schedules, product-specific rules of 
origin, and Annexes I-III setting forth servic es/investment non-conforming measures, at: 
http://www.ustr.gov/new/fta/Chile/final/index.htm  (in English) and 
http://www.direcon.cl/frame/acuerdos_internacionales/f_bilaterales.html  (in Spanish) WT/REG160/1 
Page 2  
 
 Protect , enhance, and enforce basic workers’ rights; 
  Implement this Agreement in a manner consistent  with environmental protection and 
conservation;  
 Promote sustainable development; 
  Conserve , protect, and improve the environment, including through managing natural 
resources in their respective territories and thro ugh multilateral environmental agreements to which 
they are both parties; 
 
 Preserve their flexibility to safeguard the public welfare; and 
  Contribute to hemispheric integration and the fulfilment of the objectives of the Free Trade 
Area of the Americas ; 
  
 Have Agreed as follows: 
  
CHAPTER ONE : INITIAL PROVISIONS 
 
Article 1.1 
 
Establishment Of A Free Trade Area
 
  The Parties to this Agreement, c onsistent with Article XXIV of the General Agreement on 
Tariffs and Trade 1994  and Article V of the General Agreement on Trade in Services , hereby 
establish a free trade area.  
Article 1.2 
 
Objectives
 
 
1. The objectives of this Agreement, as elaborated  more specifically through its principles and 
rules, including national treatment, most-favoured -nation treatment, and transparency, are to: 
(a) encourage expansion and diversifica tion of trade between the Parties; 
(b) eliminate barriers to trade in, and facilita te the cross-border movement of, goods and 
services between the Parties; 
(c) promote conditions of fair competition in the free trade area; 
(d) substantially increase investment opportuniti es in the territories of the Parties; 
(e) provide adequate and effective protection and enforcement of intellectual property 
rights in each Party’s territory; 
(f) create effective procedures for the implementation and application of this Agreement, 
for its joint administration, and for the resolution of disputes; and 
(g) establish a framework for further bilateral,  regional, and multila teral cooperation to 
expand and enhance the benef its of this Agreement.  WT/REG160/1 
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2. The Parties shall interpret and apply the provisi ons of this Agreement in the light of its 
objectives set out in paragraph 1 and in accordance with applicable rules of international law. 
Article 1.3 
 
Relation To Other Agreements  
 
 The Parties affirm their existing rights and obligations with respect to each other under the WTO Agreement and other agreements to which both Parties are party. 
 
Article 1.4 
 
Extent Of Obligations
 
  The Parties shall ensure that all necessary measur es are taken in order to give effect to the 
provisions of this Agreement, including their obs ervance, except as otherwise provided in this 
Agreement, by state governments. 
  
CHAPTER TWO : GENERAL DEFINITIONS 
 
Article 2.1 
 
Definitions Of General Application
 
  For purposes of this Agreement, unless otherwise specified:   
 central level of government  means: 
 
(a) for the United States, the federal level of government; and 
(b) for Chile, the national level of government; 
 Commission  means the Free Trade Commission established under Article 21.1 (The Free 
Trade Commission); 
 
 covered investment  means, with respect to a Party, an  investment in its territory of an 
investor of the other Party in existence as of th e date of entry into force of this Agreement or 
established, acquired, or expanded thereafter;  
 customs authority  means the competent authority that is responsible under the law of a Party 
for the administration of customs laws and regulations;   customs duty  includes any customs or import duty and a charge of any kind imposed in 
connection with the importation of a good, including any form of surtax or surcharge in connection with such importation, but does not include any: 
 
(a) charge equivalent to an internal tax impos ed consistently with Article III:2 of the 
GATT 1994; in respect of like, directly competitive, or substitutable goods of the Party, or in respect of goods from which the imported good has been manufactured or produced in whole or in part; 
(b) antidumping or countervailing duty; and WT/REG160/1 
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(c) fee or other charge in connection with importation commensurate with the cost of 
services rendered; 
 Customs Valuation Agreement  means the Agreement on Implementation of Article VII of 
the General Agreement on Tariffs and Trade 1994 , which is part of the WTO Agreement; 
 
 days  means calendar days; 
  enterprise  means any entity constituted or organized under applicable law, whether or not for 
profit, and whether privately-owned or government ally-owned, including any corporation, trust, 
partnership, sole proprietorship, joint venture, or other association; 
 
 enterprise of a Party  means an enterprise constituted or organized under the law of a Party; 
  existing  means in effect on the date of entry into force of this Agreement; 
 
 GATS  means the General Agreement on Trade in Services , which is part of the WTO 
Agreement;   GATT 1994  means the General Agreement on Tariffs and Trade 1994 , which is part of the 
WTO Agreement;  
 goods of a Party  means domestic products as these ar e understood in the GATT 1994 or such 
goods as the Parties may agree, and includes originating goods of that Party. A good of a Party may include materials of other countries;   Harmonized System (HS)  means the Harmonized Commodity Description and Coding 
System , including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted 
and implemented by the Parties in their respective tariff laws;   heading  means the first four digits in the ta riff classification number under the Harmonized 
System;  
 measure  includes any law, regulation, procedure, requirement, or practice; 
  national means a natural person who has the national ity of a Party according to Annex 2.1 or 
a permanent resident of a Party;  
 originating  means qualifying under the rules of orig in set out in Chapter Four (Rules of 
Origin and Origin Procedures);   person  means a natural person or an enterprise; 
 
 person of a Party  means a national or an enterprise of a Party; 
 
 preferential tariff treatment  means the duty rate applicable under this Agreement to an 
originating good;   procurement  means the process by which a government obtains the use of or acquires goods 
or services, or any combination thereof, for govern mental purposes and not with a view to commercial 
sale or resale, or use in the production or supply of goods or services for commercial sale or resale; 
  WT/REG160/1 
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 regional level of government  means, for the United States, a state of the United States, the 
District of Columbia, or Puerto Rico. For Chile, as a unitary state, “regional level of government” is 
not applicable;   Safeguards Agreement  means the Agreement on Safeguards , which is part of the WTO 
Agreement; 
  SPS Agreement  means the Agreement on the Application of  Sanitary and Phytosanitary 
Measures , which is part of the WTO Agreement; 
 
 state enterprise  means an enterprise that is owned, or  controlled through ownership interests, 
by a Party;   subheading  means the first six digits in the tariff classification number under the Harmonized 
System; 
 
 TBT Agreement  means the Agreement on Technical Barriers to Trade , which is part of the 
WTO Agreement;   territory  means for a Party the territory of that Party as set out in Annex 2.1; 
 
 TRIPS Agreement  means the Agreement on Trade-Related Aspects of Intellectual Property 
Rights , which is part of the WTO Agreement; and 
   WTO Agreement  means the Marrakech Agreement Establishing the World Trade 
Organization , done on April 15, 1994. 
 
 
ANNEX 2.1 
 
Country-Specific Definitions
 
 
 For purposes of this Agreement, unless otherwise specified: 
  natural person who has the nationality of a Party  means: 
 
(a) with respect to Chile, a chileno  as defined in Article 10 of the Constitución Política 
de la República de Chile ; and 
(b) with respect to the United States, “nationa l of the United States” as defined in the 
existing provisions of the Immigration and Nationality Act ; and  
 territory  means: 
 
(a) with respect to Chile, the land, maritime, and air space under its sovereignty, and the 
exclusive economic zone and the continental shelf within which it exercises sovereign 
rights and jurisdiction in accordance with in ternational law and its domestic law; and 
(b) with respect to the United States, 
(i) the customs territory of the United St ates, which includes the 50 states, the 
District of Columbia, and Puerto Rico, 
(ii) the foreign trade zones located in th e United States and Puerto Rico, and WT/REG160/1 
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(iii) any areas beyond the territorial seas of the United States within which, in 
accordance with international law and its domestic law, the United States may exercise rights with respect to th e seabed and subsoil and their natural 
resources. 
 
CHAPTER THREE : NATIONAL TREATM ENT AND MARKET ACCESS FOR GOODS 
 
Article 3.1 
 
Scope And Coverage
 
 
 Except as otherwise provided, this Chapter applies to trade in goods of a Party.  
 
Section A - National Treatment
 
 
Article 3.2 
 
National Treatment  
 1. Each Party shall accord national treatment to th e goods of the other Party in accordance with 
Article III of GATT 1994, including its interpretativ e notes, and to this end Article III of GATT 1994, 
and its interpretative notes, are incorporated into and made part of this Agreement, mutatis mutandis . 
2. The provisions of paragraph 1 regarding nationa l treatment shall mean, with respect to a 
regional level of government, treatment no less favour able than the most favourable treatment that 
regional level of government accords to any like, di rectly competitive, or substitutable goods, as the 
case may be, of the Party of which it forms a part.
1 
3. Paragraphs 1 and 2 shall not apply to  the measures set out in Annex 3.2. 
 
Section B - Tariff Elimination  
 
Article 3.3 
 
Tariff Elimination  
 1. Except as otherwise provided in this Agreem ent, neither Party may increase any existing 
customs duty, or adopt any customs duty, on an originating good. 
2. Except as otherwise provided in this Agreement,  each Party shall progressively eliminate its 
customs duties on originating goods  in accordance with Annex 3.3. 
3. The United States shall eliminat e customs duties on any non-agricultural originating goods 
that, after the date of entry into force of this Agreement, are designated as articles eligible for duty-
free treatment under the U.S. Generalized System of Preferences , effective from the date of such 
designation. 
4. On the request of either Party, the Parti es shall consult to consider accelerating the 
elimination of customs duties set out in their Sc hedules to Annex 3.3. An agreement between the 
                                                     
 
1 For greater certainty, "goods of th e Party" includes goods produced in a state or region of that Party.  WT/REG160/1 
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Parties to accelerate the elimination of a customs duty on a good shall supe rcede any duty rate or 
staging category determined pursuant to their Sc hedules to Annex 3.3 for such good when approved 
by each Party in accordance with Article 21.1(3)(b ) (The Free Trade Commission) and its applicable 
legal procedures. 
5. For greater certainty, a Party may: 
(a) raise a customs duty back to the level established in its Schedule to Annex 3.3 
following a unilateral reduction; or 
(b) maintain or increase a customs duty as author ized by the Dispute Settlement Body of 
the WTO. 
Article 3.4 
 
Used Goods  
  On entry into force of this Agreement, Chile  shall cease applying the 50 percent surcharge 
established in the Regla General Complementaria N° 3 of Arancel Aduanero  with respect to 
originating goods of the other Party that  benefit from preferential tariff treatment. 
 
Article 3.5 
 
Customs Valuation Of Carrier Media
 
 
1. For purposes of determining the customs value of  carrier media bearing content, each Party 
shall base its determination on the cost or value of the carrier media alone. 
2. For purposes of the effective imposition of any inte rnal taxes, direct or indirect, each Party 
shall determine the tax basis according to its domestic law. 
 
Section C - Special Regimes  
 
Article 3.6 
 
Waiver Of Customs Duties  
 
1. Neither Party may adopt any new waiver of cust oms duties, or expand with respect to existing 
recipients or extend to any new recipient the app lication of an existing waiver of customs duties, 
where the waiver is conditioned, explicitly or implicitly, on the fulfilment of a performance 
requirement. 
2. Neither Party may, explicitly or implicitly, condition on the fulfilment of a performance 
requirement the continuation of any existing waiver of customs duties. 
3. This Article shall not apply to measures subject to Article 3.8. 
Article 3.7 
 
Temporary Admission Of Goods  
 
1. Each Party shall grant duty-free temporary admission for: WT/REG160/1 
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(a) professional equipment, including equipment fo r the press or television, software and 
broadcasting and cinematographic equipment,  necessary for carrying out the business 
activity, trade or profession of a business person who qualifies for temporary entry pursuant to the laws of the importing Party; 
(b) goods intended for display or demonstration; 
(c) commercial samples and advertis ing films and recordings; and 
(d) goods admitted for sports purposes, 
regardless of their origin. 
 2. Each Party shall, at the request of the person concerned and for reasons  deemed valid by its 
customs authority, extend the time limit for te mporary admission beyond the period initially fixed. 
3. Neither Party may condition the duty-free tem porary admission of goods referred to in 
paragraph 1, other than to require that such goods: 
(a) be used solely by or under the personal s upervision of a national or resident of the 
other Party in the exercise of the business ac tivity, trade, profession, or sport of that 
person; 
(b) not be sold or leased while in its territory; 
(c) be accompanied by a security in an amount no greater than the charges that would 
otherwise be owed on entry or final impor tation, releasable on exportation of the 
good; 
(d) be capable of identification when exported; 
(e) be exported on the departure of the person re ferenced in subparagr aph (a), or within 
such other period, related to the purpose of  the temporary admission, as the Party may 
establish, or within one year, unless extended;  
(f) be admitted in no greater quantity than is  reasonable for their intended use; and 
(g) be otherwise admissible into the Party’s territory under its laws. 
4. If any condition that a Party imposes under paragraph 3 has not been fulfilled, the Party may 
apply the customs duty and any other charge that would normally be owed on the good plus any other 
charges or penalities provided for under its domestic law. 
5. Each Party, through its customs authority, shall adopt procedures providing for the 
expeditious release of goods admitted under this Artic le. To the extent possible, such procedures shall 
provide that when such a good accompanies a national or resident of the other Party who is seeking 
temporary entry, the good shall be released simultane ously with the entry of that national or resident. 
6. Each Party shall permit a good temporarily adm itted under this Article to be exported through 
a customs port other than that through which it was admitted. 
7. Each Party, through its customs authority, cons istent with domestic law, shall relieve the 
importer or other person responsib le for a good admitted under this  Article from any liability for  WT/REG160/1 
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failure to export the good on presentation of satisfact ory proof to customs authorities that the good has 
been destroyed within the original period fixed for temporary admission or any lawful extension. 
8. Subject to Chapters Ten (Investment) and Eleven (Cross-Border Trade in Services): 
(a) each Party shall allow a vehicle or container u sed in international traffic that enters its 
territory from the territory of the other Party to exit its territory on any route that is 
reasonably related to the economic and prompt departure of such vehicle or container; 
(b) neither Party may require any bond or impose any penalty or charge solely by reason 
of any difference between the port of entry and the port of departure of a vehicle or container; 
(c) neither Party may condition the release of an y obligation, including any bond, that it 
imposes in respect of the entry of a vehicle or  container into its territory on its exit 
through any particular port of departure; and  
(d) neither Party may require that the vehicle or carrier bringing a container from the 
territory of the other Party into its territory  be the same vehicle or carrier that takes 
such container to the territory of the other Party.  
9. For purposes of paragraph 8, vehicle  means a truck, a truck tractor, tractor, trailer unit or 
trailer, a locomotive, or a railway car or other railroad equipment. 
Article 3.8 
 
Drawback And Duty Deferral Programs
 
 
1. Except as otherwise provided in this Article, ne ither Party may refund the amount of customs 
duties paid, or waive or reduce the amount of customs duties owed, on a good imported into its territory, on condition that the good is: 
(a) subsequently exported to the territory of the other Party; 
(b) used as a material in the production of another good that is subsequently exported to 
the territory of the other Party; or 
(c) substituted by an identical or similar good used as a material in the production of 
another good that is subsequently exported to the territory of the other Party. 
2. Neither Party may, on condition of export, refund, waive, or reduce: 
(a) an antidumping or countervailing duty; 
(b) a premium offered or collected on an im ported good arising out of any tendering 
system in respect of the administration of  quantitative import restrictions, tariff rate 
quotas, or tariff preference levels; or 
(c) customs duties paid or owed on a good impor ted into its territory and substituted by 
an identical or similar good that is subsequent ly exported to the territory of the other 
Party. 
3. Where a good is imported into the territory of a Party pursuant to a duty deferral program and 
is subsequently exported to the territo ry of the other Party, or is used as a material in the production of WT/REG160/1 
Page 10  
 
another good that is subsequently exported to the territory of the other Party, or is substituted by an 
identical or similar good used as a material in th e production of another good that is subsequently 
exported to the territory of the other Party, the Party from whose territory the good is exported shall 
assess the customs duties as if the exported good ha d been withdrawn for domestic consumption. 
4. This Article does not apply to: 
(a) a good entered under bond for transportation a nd exportation to the territory of the 
other Party; 
(b) a good exported to the territory of the ot her Party in the same condition as when 
imported into the territory of the Party from which the good was exported (testing, 
cleaning, repacking, inspecting, sorting, marking, or preserving a good shall not be 
considered to change the good’s condition). Where such a good has been commingled 
with fungible goods and exported in the same condition, its origin for purposes of this 
subparagraph may be determined on the basis of such inventory management 
methods as first-in, first-out or last-in, fi rst-out. Nothing in this subparagraph shall be 
construed to permit a Party to waive, ref und, or reduce a customs duty contrary to 
paragraph 2(c); 
(c) a good imported into the territory of a Party that is deemed to be exported from its 
territory, or used as a material in the pro duction of another good that is deemed to be 
exported to the territory of the other Party, or is substituted by an identical or similar 
good used as a material in the production of another good that is deemed to be exported to the territory of the other Party, by reason of: 
(i) delivery to a duty-free shop, 
(ii) delivery for ship's stores or supplies for ships or aircraft, or 
(iii) delivery for use in joint undertakings of the Parties and that will subsequently 
become the property of the Party into whose territory the good was deemed to be exported; 
(d) a refund of customs duties by a Party on a particular good imported into its territory 
and subsequently exported to the territory of the other Party, where that refund is 
granted by reason of the failure of such good to conform to sample or specification, or by reason of the shipment of such good without the consent of the consignee; or 
(e) an originating good that is imported into the territory of a Party and is subsequently 
exported to the territory of the other Party, or used as a material in the production of 
another good that is subsequently exported to  the territory of the other Party, or is 
substituted by an identical or similar good used as a material in the production of 
another good that is subsequently exported to the territory of the other Party. 
5. This Article shall take effect beginning eight y ears after the date of entry into force of this 
Agreement, and thereafter a Party may refund, waive,  or reduce duties paid or owed under the Party’s 
duty drawback or deferral programs according to the following schedule: 
(a) no more than 75 percent in year nine; 
(b) no more than 50 percent in year 10; 
(c) no more than 25 percent in year 11; and  WT/REG160/1 
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(d) zero in year 12 and thereafter. 
6. For purposes of this Article: 
 good  means “good” as defined in Article 4.18 (Definitions); 
  identical or similar goods  means “identical goods” and “similar goods”, respectively, as 
defined in the Customs Valuation Agreement; 
  material  means “material” as defined in  Article 4.18 (Definitions); and 
  used  means used or consumed in the production of goods. 
 
Article 3.9 
 
Goods Re-Entered After Repair Or Alteration
 
 
1. Neither Party may apply a customs duty to a good,  regardless of its origin, that re-enters its 
territory after that good has been temporarily export ed from its territory to the territory of the other 
Party for repair or alteration, regardless of whether such repair or alteration could be performed in its 
territory. 
2. Neither Party may apply a customs duty to a good, regardless of its origin, admitted 
temporarily from the territory of the other Party for repair or alteration. 
3. For purposes of this Article, repair or alteration  does not include an operation or process 
that: 
(a) destroys a good’s essential characteristics or  creates a new or commercially different 
good; or 
(b) transforms an unfinished good into a finished good. 
Article 3.10 
 
Duty-Free Entry of Commercial Samples of Neglig ible Value and Printed Advertising Materials  
  Each Party shall grant duty-free entry to comme rcial samples of negligible value, and to 
printed advertising materials, imported from the territo ry of the other Party, regardless of their origin, 
but may require that: 
 
(a) such samples be imported solely for the solicitation of orders for goods, or services 
provided from the territory, of the other Party or a non-Party; or 
(b) such advertising materials be imported in packets that each contain no more than one 
copy of each such material and that neither such materials nor packets form part of a 
larger consignment. WT/REG160/1 
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Section D - Non-Tariff Measures
 
 
Article 3.11 
 
Import And Export Restrictions  
 
1. Except as otherwise provided in this Agreement,  neither Party may adopt or maintain any 
prohibition or restriction on the importation of an y good of the other Party or on the exportation or 
sale for export of any good destined for the territory  of the other Party, except in accordance with 
Article XI of GATT 1994 and its interpretative notes a nd to this end Article XI of GATT 1994 and its 
interpretative notes are incorporated into and made a part of this Agreement, mutatis mutandis . 
2. The Parties understand that the GATT rights and obligations incorporated by paragraph 1 
prohibit, in any circumstances in which any other form of restriction is prohibited, a Party from adopting or maintaining: 
(a) export and import price requirements, except as permitted in enforcement of 
countervailing and antidumping orders and undertakings; 
(b) import licensing conditioned on the fulfilment of a performance requirement; or 
(c) voluntary export restraints not consiste nt with Article VI of GATT 1994, as 
implemented under Article 18 of the SCM Agreement and Article 8.1 of the AD 
Agreement. 
3. In the event that a Party adopts or maintains a prohibition or restriction on the importation 
from or exportation to a non-Party of a good, nothing in this Agreement shall be construed to prevent 
the Party from: 
(a) limiting or prohibiting the importation from the territory of the other Party of such 
good of that non-Party; or 
(b) requiring as a condition of export of such good of the Party to the territory of the 
other Party, that the good not be re-exported to the non-Party, directly or indirectly, 
without being consumed in the territory of the other Party. 
4. In the event that a Party adopts or maintains a prohibition or restriction on the importation of 
a good from a non-Party, the Parties, on the request of  either Party, shall consult with a view to 
avoiding undue interference with or distortion of pr icing, marketing, and distribution arrangements in 
the other Party. 
5. Paragraphs 1 through 4 shall not apply to the measures set out in Annex 3.2.  
Article 3.12 
 
Administrative Fees And Formalities
 
 
1. Each Party shall ensure, in accordance with Article VIII:1 of GATT 1994 and its interpretive 
notes, that all fees and charges of whatever character  (other than customs duties, charges equivalent to 
an internal tax or other internal charge applie d consistently with Article III:2 of GATT 1994, and 
antidumping and countervailing duties) imposed on or in connection with importation or exportation 
are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to domestic goods or a taxation of  imports or exports for fiscal purposes.  WT/REG160/1 
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2. Neither Party may require consular transacti ons, including related fees and charges, in 
connection with the importation of any good of the other Party. 
3. Each Party shall make available through the Internet or a comparable computer-based 
telecommunications network a current list of th e fees and charges it imposes in connection with 
importation or exportation. 
4. The United States shall eliminate its mercha ndise processing fee on originating goods of 
Chile. 
Article 3.13 
 
Export Taxes  
 
 Neither Party may adopt or maintain any duty, tax, or other charge on the export of any good 
to the territory of the other Party, unless such duty,  tax, or charge is adopted or maintained on any 
such good when destined for domestic consumption.  
Article 3.14 
 
Luxury Tax
 
  Chile shall eliminate the Luxury Tax established in Article 46 of Decreto Ley  825 of 1974, 
according to the schedule set out in Annex 3.14. 
 
 
Section E - Other Measures
 
 
Article 3.15 
 
Distinctive Products  
 1. Chile shall recognize Bourbon Whiskey and Tenness ee Whiskey, which is a straight Bourbon 
Whisky authorized to be produced only in the Stat e of Tennessee, as distinctive products of the United 
States. Accordingly, Chile shall not permit the sale of any product as Bourbon Whiskey or Tennessee 
Whiskey, unless it has been manufactured in the United States in accordance with the laws and 
regulations of the United States governing the manufacture of Bourbon Whiskey and Tennessee 
Whiskey. 
2. The United States shall recognize Pisco Chileno  (Chilean Pisco), Pajarete , and Vino 
Asoleado , which is authorized in Chile to be produced only in Chile, as distinctive products of Chile. 
Accordingly, the United States shall not permit the sale of any product as Pisco Chileno  (Chilean 
Pisco), Pajarete , or Vino Asoleado , unless it has been manufactured in  Chile in accordance with the 
laws and regulations of Chile governing the manufacture of Pisco , Pajarete , and Vino Asoleado . WT/REG160/1 
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Section F - Agriculture
 
 
Article 3.16 
 
Agricultural Export Subsidies  
 
1. The Parties share the objective of the multila teral elimination of export subsidies for 
agricultural goods and shall work together toward an agreement in the World Trade Organization to 
eliminate those subsidies and prevent their reintroduction in any form. 
2. Except as provided in paragraph 3, neither Pa rty shall introduce or maintain any export 
subsidy on any agricultural good destined for the territory of the other Party. 
3. Where an exporting Party considers that a non-Party is exporting an agricultural good to the 
territory of the other Party with the benefit of e xport subsidies, the importing Party shall, on written 
request of the exporting Party, consult with the ex porting Party with a view to agreeing on specific 
measures that the importing Party may adopt to counte r the effect of such subsidized imports. If the 
importing Party adopts the agreed-upon measures, th e exporting Party shall refrain from applying any 
export subsidy to exports of such good to the territory of the importing Party. 
Article 3.17 
 
Agricultural Marketing And Grading Standards  
 
1. Where a Party adopts or maintains a measure  respecting the classification, grading, or 
marketing of a domestic agricultural good, or a meas ure to expand, maintain, or develop its domestic 
market for an agricultural good, it sh all accord treatment to a like good of the other Party that is no 
less favorable than it accords under the measure to  the domestic agricultural good, regardless of 
whether the good is intended for direct consumption or for processing. 
2. Paragraph 1 shall be without prejudice to the rights of either Party under the WTO Agreement 
or under this Agreement regarding measures respectin g the classification, grading, or marketing of an 
agricultural good. 
3. The Parties hereby establish a Working Group on Agricultural Trade, comprising 
representatives of the Parties, which shall meet a nnually or as otherwise agreed. The Working Group 
shall review, in coordination with the Committee on T echnical Barriers to Trade established in Article 
7.8 (Committee on Technical Barriers to Trade), the operation of agricultural grade and quality 
standards and programs of expansion and development that affect trade between the Parties, and shall 
resolve any issues that may arise regarding the ope ration of those standards and programs. The Group 
shall report to the Committee on Trade in  Goods established in Article 3.23. 
4. Each Party shall recognize the other Party’s grading programs for beef, as set out in       
Annex 3.17. 
Article 3.18 
 
Agricultural Safeguard Measures  
 1. Notwithstanding Article 3.3(2), each Party may impose a safeguard measure in the form of 
additional import duties, consistent  with paragraphs 2 through 7, on an originating agricultural good 
listed in its section of Annex 3.18. The sum of an y such additional duty and any import duties or other 
charges applied pursuant to Article 3.3(2) shall not exceed the lesser of:  WT/REG160/1 
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(a) the prevailing most-favored-nation (MFN) applied rate; or  
(b) the MFN applied rate of duty in effect on the day immediately preceding the date of 
entry into force of this Agreement. 
2. A Party may impose a safeguard measure only if the unit import price of the good enters the 
Party’s customs territory at a level below a trigger price for that good as set out in that Party’s section 
of Annex 3.18. 
(a) The unit import price shall be determined on the basis of the C.I.F. import price of the 
good in U.S. dollars for goods entering Chile, and on the basis of the F.O.B. import price of the good in U.S. dollars for goods entering the United States. 
(b) The trigger prices for the goods eligible for a safeguard measure, which reflect 
historic unit import values for the products concerned, are listed in Annex 3.18. The 
Parties may mutually agree to periodically evaluate and update the trigger prices. 
3. The additional duties under paragraph 2 sha ll be set in accordance with the following 
schedule: 
(a) if the difference between the unit import price of the item expressed in terms of 
domestic currency (the “import price”) and the trigger price as defined under 
paragraph 2(b) is less than or equal to 10 percent of the trigger price, no additional 
duty shall be imposed; 
(b) if the difference between the import price and the trigger price is greater than 10 
percent but less than or equal to 40 percent of the trigger price, the additional duty shall equal 30 percent of the difference between the MFN rate applicable under 
paragraph 1 and the preferential tariff rate; 
(c) if the difference between the import price and the trigger price is greater than 40 
percent but less than or equal to 60 percent of the trigger price, the additional duty shall equal 50 percent of the difference between the MFN rate applicable under 
paragraph 1 and the preferential tariff rate; 
(d) if the difference between the import price and the trigger price is greater than 60 
percent but less than or equal to 75 percen t, the additional duty shall equal 70 percent 
of the difference between the MFN rate  applicable under paragraph 1 and the 
preferential tariff rate; and  
(e) if the difference between the import price and the trigger price is greater than 75 
percent of the trigger price, the add itional duty shall equal 100 percent of the 
difference between the MFN rate applicab le under paragraph 1 and the preferential 
tariff rate. 
4. Neither Party may, with respect to  the same good, at the same time: 
(a) impose a safeguard measure under this Article; and 
(b) take a safeguard action under Section A of Chapter Eight (Trade Remedies). 
5. Neither Party may impose a safeguard measure on a good that is subject to a measure that the 
Party has imposed pursuant to Article XIX of GA TT 1994 and the Safeguards Agreement, and neither WT/REG160/1 
Page 16  
 
Party may continue maintaining a safeguard measu re on a good that becomes subject to a measure 
that the Party imposes pursuant to Article XI X of GATT 1994 and the Safeguards Agreement. 
6. A Party may impose a safeguard measure onl y during the 12-year period beginning on the 
date of entry into force of this Agreement. Ne ither Party may impose a safeguard measure on a good 
once the good achieves duty-free status under this Ag reement. Neither Party may impose a safeguard 
measure that increases a zero in-quota duty on a good subject to a tariff-rate quota.  
7. Each Party shall implement any safeguard measu re in a transparent manner. Within 60 days 
after imposing a measure, a Party shall notify the othe r Party, in writing, and shall provide it relevant 
data concerning the measure. On request, the Party imposing the measure shall consult with the other 
Party with respect to the conditions  of application of the measure. 
8. The general operation of the agricultural safegua rd provisions and the trigger prices for their 
implementation may be the subject of discussion and review in the Committee on Trade in Goods. 
9. For purposes of this Article, safeguard measure  means an agricultural safeguard measure 
described in paragraph 1. 
 
Section G - Textiles And Apparel
 
 
Article 3.19 
 
Bilateral Emergency Actions  
 
1. If, as a result of the elimination of a duty provide d for in this Agreement,  a textile or apparel 
good benefiting from preferential tariff treatment unde r this Agreement is being imported into the 
territory of a Party in such incr eased quantities, in absolute terms or  relative to the domestic market 
for that good, and under such conditions as to cause  serious damage, or actual threat thereof, to a 
domestic industry producing a like or directly co mpetitive good, the importing Party may, to the 
extent and for such time as may be necessary to prevent or remedy such damage and to facilitate 
adjustment, take emergency action, consisting of an  increase in the rate of duty on the good to a level 
not to exceed the lesser of: 
(a) the most-favored-nation (MFN) applied rate of  duty in effect at the time the action is 
taken; and 
(b) the MFN applied rate of duty in effect on the date of entry into force of this 
Agreement. 
2. In determining serious damage, or actua l threat thereof, the importing Party: 
(a) shall examine the effect of increased imports from the other Party on the particular 
industry, as reflected in changes in such relevant economic variables as output, productivity, utilization of capacity, inventor ies, market share, exports, wages, 
employment, domestic prices, profits and investment, none of which is necessarily 
decisive; and 
(b) shall not consider changes in technolo gy or consumer preference as factors 
supporting a determination of serious damage or actual threat thereof. 
3. The importing Party may take an emergency action under this Article only following an 
investigation by its competent authorities.  WT/REG160/1 
 Page 17 
 
 
4. The importing Party shall deliver to the other Part y, without delay, written notice of its intent 
to take emergency action, and, on request of the ot her Party, shall enter into consultations with that 
Party. 
5. The following conditions and limitations shall a pply to any emergency action taken under this 
Article: 
(a) no emergency action may be maintained for a period exceeding three years; 
(b) no emergency action may be taken or ma intained beyond the period ending eight 
years after duties on a good have been e liminated pursuant to this Agreement; 
(c) no emergency action may be taken by an im porting Party against any particular good 
of the other Party more than once; and 
(d) on termination of the action, the good will return to duty-free status. 
6. The Party taking an emergency action under this Article shall provide to the Party against 
whose good the action is taken mutually agreed tr ade liberalizing compensation in the form of 
concessions having substantia lly equivalent trade effects or equiva lent to the value of the additional 
duties expected to result from the emergency action. Such concessions shall be  limited to textile and 
apparel goods, unless the Parties otherwise agree. If the Parties are unable to agree on compensation, 
the Party against whose good the emergency action is taken may take tariff action having trade effects 
substantially equivalent to the trade effects of the emergency action taken under this Article. Such 
tariff action may be taken against any goods of the Party taking the emergency action. The Party 
taking the tariff action shall apply such action only for the minimum period necessary to achieve the substantially equivalent trade effects. The importi ng Party’s obligation to provide trade compensation 
and the exporting Party’s right to take tariff ac tion shall terminate when the emergency action 
terminates. 
7. Nothing in this Agreement shall be construed to limit a Party’s right to restrain imports of 
textile and apparel goods in a manne r consistent with the Agreement on Textiles and Clothing or the 
Safeguards Agreement. However, a Party may not ta ke or maintain an emergency action under this 
Article against a textile or apparel good that is s ubject, or becomes subject, to a safeguard measure 
that a Party takes pursuant to either such WTO agreement. 
Article 3.20 
 
Rules Of Origin And Related Matters
 
 Application Of Chapter Four 
 
1. Except as provided in this Section, Chapter Four (Rules of Origin and Origin Procedures) 
applies to textile and apparel goods. 
2. The rules of origin set forth in this Agreemen t shall not apply in determining the country of 
origin of a textile or apparel good for non-preferential purposes.  
Consultations 
 
3. On the request of either Party, the Parties shall consult to consider whether the rules of origin 
applicable to particular textile and apparel goods should be revised to address issues of availability of 
supply of fibers, yarns or fabrics in the territories of the Parties. WT/REG160/1 
Page 18  
 
4. In the consultations referred to in paragraph 3, each Party shall consider all data presented by 
the other Party showing substantial production in its territory of the particular good. The Parties shall 
consider that substantial production has been s hown if a Party demonstrates that its domestic 
producers are capable of supplying commercia l quantities of the good in a timely manner. 
5. The Parties shall endeavour to conclude cons ultations within 60 days of a request. An 
agreement between the Parties resulting from the consu ltations shall supersede any prior rule of origin 
for such good when approved by the Parti es in accordance with Article 24.2 (Amendments). 
De Minimis 
 
6. A textile or apparel good provided for in Ch apters 50 through 63 of the Harmonized System 
that is not an originating good, because certain fibers or yarns used in the production of the 
component of the good that determines the tari ff classification of the good do not undergo an 
applicable change in tariff classification set out in Annex 4.1 (Specific Rules of Origin), shall 
nonetheless be considered to be an originating good if the total weight of all such fibers or yarns in 
that component is not more than seven percent of the total weight of that component. Notwithstanding 
the preceding sentence, a good containing elastomeric yarns in the component of the good that 
determines the tariff classification of the good shall be  considered to be an originating good only if 
such yarns are wholly formed in the territory of a Party. 
Treatment Of Sets 
 
7. Notwithstanding the good specific rules in Annex 4.1 (Specific Rules of Origin), textile and 
apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of 
Interpretation 3 of the Harmonized System shall not  be regarded as originating goods unless each of 
the goods in the set is an originating good or the total value of the non-originating goods in the set 
does not exceed 10 percent of the customs value of the set. 
Preferential Tariff Treatment For Non-Originat ing Cotton And Man-Made Fiber Fabric Goods 
(Tariff Preference Levels) 
 
8. Subject to paragraph 9, the following goods, if  they meet the applicable conditions for 
preferential tariff treatment under this Agreement ot her than the condition that they be originating 
goods, shall be accorded preferential tariff treat ment as if they were originating goods: 
(a) cotton or man-made fiber fabr ic goods provided for in Chapters 52, 54, 55, 58, and 60 
of the Harmonized System that are wholly fo rmed in the territory of a Party from yarn 
produced or obtained outside the territory of a Party; and  
(b) cotton or man-made fiber fabric goods provi ded for in Annex 4.1 (Specific Rules of 
Origin) that are wholly formed in the te rritory of a Party from yarn spun in the 
territory of a Party from fiber produced or obtained outside the territory of a Party. 
9. The treatment described in paragraph 8 shall be limited to goods imported into the territory of 
a Party up to an annual total quantity of 1,000,000 SME. 
Preferential Tariff Treatment For Non-Origina ting Cotton And Man-Made Fiber Apparel Goods 
(Tariff Preference Levels) 
 
10. Subject to paragraph 11, cotton or man-made fiber apparel goods provided for in Chapters 61 
and 62 of the Harmonized System that are both cut (or knit to shape) and sewn or otherwise 
assembled in the territory of a Party from fabric or yarn produced or obtained outside the territory of a 
Party, and that meet the applicable conditions fo r preferential tariff treatment under this Agreement  WT/REG160/1 
 Page 19 
 
 
other than the condition that they be originating go ods, shall be accorded preferential tariff treatment 
as if they were originating goods. 
11. The treatment described in paragraph 10 shall be limited as follows:  
(a) in each of the first 10 years after the date of  entry into force of this Agreement, the 
treatment shall apply to goods described in that paragraph imported into the territory 
of a Party up to a quantity of 2,000,000 SME; and 
(b) in the eleventh year, and for each year thereafter, the treatment shall apply to goods 
described in that paragraph imported into th e territory of a Party up to a quantity of 
1,000,000 SME. 
Certification For Tariff Preference Level 
 
12. A Party, through its competent authorities, may require that an importer claiming preferential 
tariff treatment for a textile or apparel good unde r paragraph 8 or 10 present to such competent 
authorities at the time of importation a certification of eligibility for preferen tial tariff treatment under 
such paragraph. A certification of eligibility shall be prepared by the importer and shall consist of 
information demonstrating that the good satisfies the requirements for preferential tariff treatment 
under paragraph 8 or 10.  
Article 3.21 
 
Customs Cooperation  
 
1. The Parties shall cooperate for purposes of: 
(a) enforcing or assisting in the enforcement of their laws, regulations, and procedures 
implementing this Agreement affecti ng trade in textile and apparel goods; 
(b) ensuring the accuracy of claims of origin; and 
(c) preventing circumvention of laws, regulati ons, and procedures of either Party or 
international agreements affecting trade in textile and apparel goods. 
2. On the request of the importing Party, the exporting Party shall conduct a verification for 
purposes of enabling the importing Party to determine th at a claim of origin for a textile or apparel 
good is accurate. The exporting Party shall conduct su ch a verification, regardless of whether an 
importer claims preferential tariff treatment for the good. The exporting Party also may conduct such 
a verification on its own initiative.  
3. Where the importing Party has a reasonable suspicion that an exporter or producer of the 
exporting Party is engaging in unlawful activity re lating to trade in tex tile and apparel goods, the 
importing Party may request the exporting Party to conduct a verification for purposes of enabling the 
importing Party to determine that the exporter or prod ucer is complying with applicable customs laws, 
regulations, and procedures regarding trade in te xtile and apparel goods, in cluding laws, regulations, 
and procedures that the exporting Party adopts and maintains pursuant to this Agreement and laws, 
regulations, and procedures of either Party implem enting other international agreements regarding 
trade in textile and apparel goods, a nd to determine that claims of or igin regarding te xtile or apparel 
goods exported or produced by that person are accura te. For purposes of this paragraph, a reasonable 
suspicion of unlawful activity shall be based on fact ors including relevant factual information of the 
type set forth in Article 5.5 (Cooperation) or that , with respect to a particular shipment, indicates 
circumvention by the exporter or producer of a pplicable customs laws, regulations, or procedures WT/REG160/1 
Page 20  
 
regarding trade in textile and a pparel goods, including laws, regula tions, or procedures adopted to 
implement this Agreement, or international agreem ents affecting trade in textile and apparel goods. 
4. The importing Party, through its competent authorities, may undertake or assist in a 
verification conducted pursuant to  paragraph 2 or 3, including by conducting, along with the 
competent authorities of the exporting Party, visits in the territory of the exporting Party to the 
premises of an exporter, producer, or any other en terprise involved in the movement of textile or 
apparel goods from the territory of the exporting Pa rty to the territory of the importing Party. 
5. Each Party shall provide to the other Party,  consistent with its laws, regulations, and 
procedures, production, trade, and transit docum ents and other information necessary to conduct 
verifications under paragraphs 2 a nd 3. Any documents or informati on exchanged between the Parties 
in the course of such a verification shall be cons idered confidential, as provided for in Article 5.6 
(Confidentiality). 
6. While a verification is being conducted, the importing Party may take appropriate action, 
which may include suspending the application of preferential tariff treatment to: 
(a) the textile or apparel good for which a claim of  origin has been made, in the case of a 
verification under paragraph 2; or 
(b) the textile and apparel goods exported or  produced by the person subject to a 
verification under paragraph 3, where the reasonable suspicion of unlawful activity 
relates to those goods. 
7. The Party conducting a verification under paragra ph 2 or 3 shall provide the other Party with 
a written report on the results of the verification,  which shall include all documents and facts 
supporting any conclusion th at the Party reaches. 
8. (a) If the importing Party is unable to make the determination described in paragraph 2 
within 12 months after its request for a verification, it may take action as permitted 
under its law with respect to the textile a nd apparel good subject to the verification, 
and with respect to similar goods exported or  produced by the person that exported or 
produced the good. 
(b) If the importing Party is unable to make th e determinations described in paragraph 3 
within 12 months after its request for a verification, it may take action as permitted 
under its law with respect to any textile or  apparel goods exported or produced by the 
person subject to the verification. 
9. Prior to commencing appropriate action under pa ragraph 8, the importing Party shall notify 
the other Party. The importing Party may continue to take appropriate acti on under paragraph 8 until it 
receives information sufficient to enable it to make the determination described in paragraph 2 or 3, as 
the case may be. 
10. Chile shall implement its obligati ons under paragraphs 2, 3, 6, 7,  8, and 9 no later than two 
years after the date of entry into force of this  Agreement. Before Chile fully implements those 
provisions, if the importing Party requests a veri fication, the verification shall be conducted 
principally by that Party, including through means descr ibed in paragraph 4. Nothing in this paragraph 
shall be construed to waive or limit the importi ng Party’s rights under paragraphs 6 and 8. 
11. 
On the request of either Party, the Parties shall enter into consultations to resolve any 
technical or interpretive difficulties that may arise un der this Article or to discuss ways to improve the 
effectiveness of their cooperative efforts. In add ition, either Party may request technical or other  WT/REG160/1 
 Page 21 
 
 
assistance from the other Party in implementing this Article. The Party receiving such a request shall 
make every effort to respond favourably and promptly to it.  
Article 3.22 
 
Definitions  
 
 For purposes of this Section:   claim of origin  means a claim that a textile or apparel good is an originating good or a good 
of a Party; 
 
 exporting Party  means the Party from whose territory a textile or apparel good is exported;  
  importing Party  means the Party into whose territory a textile or apparel good is imported; 
 
 SME  means square meter equivalents, as calcula ted in accordance with the conversion factors 
set out in the Correlation: Textile and Apparel Categories w ith the Harmonized Tariff Schedule of the 
United States, 2002  (or successor publication), published by the United States Department of 
Commerce, International Trade Administration, Office of Textiles and Apparel, Trade and Data Division, Washington, D.C.; and   
 textile or apparel good  means a good listed in the Annex to the Agreement on Textiles and 
Clothing.   
Section H - Institutional Provisions
 
 
Article 3.23 
 
Committee On Trade In Goods  
 1. The Parties hereby establish a Committee on Trade in Goods, comprising representatives of 
each Party. 
2. The Committee shall meet on the request of e ither Party or the Commission to consider any 
matter arising under this Chapter, Chapter Four (Rul es of Origin and Origin Procedures), or Chapter 
Five (Customs Administration). 
3. The Committee’s functions shall include: 
(a) promoting trade in goods between the Par ties, including through consultations on 
accelerating tariff elimination under this Agreement and other issues as appropriate; and 
(b) addressing barriers to trade in goods between the Parties, especially those related to 
the application of non-tariff measures, and, if appropriate, referring such matters to 
the Commission for its consideration. WT/REG160/1 
Page 22  
 
Section I - Definitions
 
 
Article 3.24 
 
Definitions  
 
 For purposes of this Chapter:   AD Agreement  means the Agreement on Implementation of Article VI of the General 
Agreement on Tariffs and Trade 1994 , which is part of the WTO Agreement; 
 
 advertising films and recordings  means recorded visual media or audio materials, consisting 
essentially of images and/or sound, showing the natu re or operation of goods or services offered for 
sale or lease by a person established or resident in the territory of a Party, provided that such materials 
are of a kind suitable for exhibition to prospectiv e customers but not for broadcast to the general 
public, and provided that they are imported in pack ets that each contain no more than one copy of 
each film or recording and that do not form part of a larger consignment;   Agreement on Textiles and Clothing  means the Agreement on Textiles and Clothing , which 
is part of the WTO Agreement;  
 agricultural goods  means those goods referred to in Article 2 of the Agreement on 
Agriculture , which is part of the WTO Agreement; 
 
 articles eligible for duty-free treatment under the U.S. Generalized System of 
Preferences  does not include articles eligible only wh en imported from least- developed beneficiary 
developing countries or from beneficiar y sub-Saharan African countries under the African Growth 
and Opportunity Act ; 
  carrier media  means any good of heading 8523 or 8524;  
  commercial samples of negligible value  means commercial samples having a value, 
individually or in the aggregate as shipped, of not more than one U.S.  dollar, or the equivalent amount 
in Chilean currency, or so marked , torn, perforated, or otherwise tr eated that they are unsuitable for 
sale or for use except as commercial samples;    consular transactions  means requirements that goods of a Party intended for export to the 
territory of the other Party must first be submitted to the supervision of the consul of the importing 
Party in the territory of the exporting Party for th e purpose of obtaining consular invoices or consular 
visas for commercial invoices, certificates of origin, ma nifests, shippers’ export declarations, or any 
other customs documentation required on or in connection with importation; 
  consumed  means: 
 
(a) actually consumed; or 
(b) further processed or manufactured so as to result in a substantial change in value, 
form, or use of the good or in the production of another good; 
 duty-free  means free of customs duty; 
 
 duty deferral program includes measures such as those governing foreign-trade zones, 
regímenes de zonas francas y regímenes aduaneros especiales , temporary importations under bond, 
bonded warehouses, and inward processing programs;  WT/REG160/1 
 Page 23 
 
 
 export subsidies  shall have the meaning assigned to that term in Article 1(e) of the WTO 
Agreement on Agriculture, including an y amendment of that article;  
  goods intended for display or demonstration  includes their component parts, ancillary 
apparatus, and accessories; 
 
 goods temporarily admitted for sports purposes  means sports requisites for use in sports 
contests, demonstrations, or training in the territory  of the Party into whose territory such goods are 
admitted;  
 import licensing  means an administrative procedure requiring the submission of an 
application or other documentation (other than  that generally required for customs clearance 
purposes) to the relevant administrative body as a pr ior condition for importation into the territory of 
the importing Party;  
 performance requirement  means a requirement that: 
 
(a) a given level or percentage of goods or services be exported; 
(b) domestic goods or services of the Party granting a waiver of customs duties or an 
import license be substituted for imported goods or services; 
(c) a person benefiting from a waiver of customs duties or an import license purchase 
other goods or services in the territory of the Party granting the waiver of customs 
duties or the import license, or accord a pref erence to domestically produced goods or 
services; 
(d) a person benefiting from a waiver of customs duties or an import license produce 
goods or supply services, in the territory of the Party granting the waiver of customs 
duties or the import license, with a given leve l or percentage of domestic content; or 
(e) relates in any way the volume or value of im ports to the volume or value of exports or 
to the amount of foreign exchange inflows. 
 printed advertising materials  means those goods classified in Chapter 49 of the Harmonized 
System, including brochures, pamphlets, leaflets , trade catalogues, yearbooks published by trade 
associations, tourist promotional materials, and pos ters, that are used to promote, publicize, or 
advertise a good or service, are essentially intended to advertise a good or service, and are supplied 
free of charge; and    SCM Agreement  means the Agreement on Subsidies and Countervailing Measures , which is 
part of the WTO Agreement. 
 
 
ANNEX 3.2 
 
National Treatment And Import And Export Restrictions
 
 
Section A - Measures Of The United States  
 
 Article 3.2 and Article 3.11 shall not apply to:  
(a) controls by the United States on the export of logs of all species; WT/REG160/1 
Page 24  
 
(b) (i) measures under existing provisions of the Merchant Marine  Act of 1920 , 46 
App. U.S.C. § 883; the Passenger Vessel  Act, 46 App. U.S.C. §§ 289, 292 and 
316; and 46 U.S.C. § 12108, to the extent that such measures were mandatory legislation at the time of the United States accession to the General Agreement on Tariffs and Trade 1947 and have not been amended so as to 
decrease their conformity with Part II of GATT 1947; 
(ii) the continuation or prompt renewal of a non-conforming provision of any 
statute referred to in clause (i); and 
(iii) the amendment to a non-conforming provision of any statute referred to in 
clause (i) to the extent that the amen dment does not decrease the conformity 
of the provision with Articles 3.2 and 3.11; 
(c) actions by the United States authorized by the Dispute Settlement Body of the WTO; 
and 
(d) actions by the United States authorized by  the Agreement on Textiles and Clothing. 
 
Section B - Measures Of Chile
 
 
1. Article 3.2 and Article 3.11 shall not apply to actions by Chile authorized by the Dispute 
Settlement Body of the WTO. 
2. Article 3.11 shall not apply to measures of Ch ile relating to imports of used vehicles.  
 
ANNEX 3.3 
 
Tariff Elimination  
 1. Except as otherwise provided in a Party’s Schedul e attached to this Annex, the following 
staging categories apply to the elimination of cust oms duties by each Party pursuant to Article 3.3(2): 
(a) duties on goods provided for in the items in staging category A in a Party’s Schedule 
shall be eliminated entirely and such goods shall be duty-free on the date this 
Agreement enters into force; 
(b) duties on goods provided for in the items in staging category B in a Party’s Schedule 
shall be removed in four equal annual st ages beginning on the date this Agreement 
enters into force, and such goods shall be duty-free, effective January 1 of year four; 
(c) duties on goods provided for in the items in staging category C in a Party’s Schedule 
shall be removed in eight equal annual st ages beginning on the date this Agreement 
enters into force, and such goods shall be duty-free, effective January 1 of year eight; 
(d) duties on goods provided for in the items in staging category D in a Party’s Schedule 
shall be removed in ten equal annual st ages beginning on the date this Agreement 
enters into force, and such goods shall be duty-free, effective January 1 of year ten; 
(e) duties on goods provided for in the items in staging category E in a Party’s schedule 
shall be removed in twelve equal annual st ages beginning on the date this Agreement  WT/REG160/1 
 Page 25 
 
 
enters into force, and such goods shall be  duty-free, effective January 1 of year 
twelve; 
(f) goods provided for in the items in staging category F in a Party’s schedule shall 
continue to receive duty-free treatment;  
(g) duties on goods provided for in the items in staging category G shall remain at base 
rates during years one through four. Duties on these goods shall be reduced by 8.3 
percent of the base rate on January 1 of year five, and by an additional 8.3 percent of the base rate each year thereafter though year eight. Beginning January 1 of year nine, duties on these goods shall be reduced by an additional 16.7 percent of the base rate 
annually through year twelve and shall be  duty-free effective January 1 of year 
twelve; and 
(h) duties on goods provided for in the items in staging category H shall remain at base 
rates during years one and two. Beginning January 1 of year three, duties on these goods shall be removed in eight equal annual stages, and such goods shall be duty-free effective January 1 of year ten. 
2. The base rate of customs duty and staging cat egory for determining the interim rate of 
customs duty at each stage of reduction for an item ar e indicated for the item in each Party’s Schedule 
attached to this Annex.  
3. For the purpose of the elimination of customs duties in accordance with Article 3.3, interim 
staged rates shall be rounded down, at least to the ne arest tenth of a percentage point or, if the rate of 
duty is expressed in monetary units, at least to the nearest 0.001 of the official monetary unit of the 
Party. 
 
ANNEX 3.14 
 
Luxury Tax
 
 
1. Chile shall eliminate the Luxury Tax established in Article 46 of Decreto Ley 825 of 1974 
according to the following schedule: 
 Year Tax Rate 
    1 63.75%     2 42.50% 
    3 21.25% 
    4   0.00%  2. Upon the date of entry into force of this Ag reement, Chile shall increase the threshold at 
which the tax is applied to US$2,500 above the level provided for that year under Article 46 of 
Decreto Ley 825, and increase the threshold each subsequent  year by an additional US$2,500 until the 
tax is eliminated. 
 
ANNEX 3.17 
 
Mutual Recognition Of Grading Programs  For The Purpose Of Marketing Beef
 
 
 Further to Article 3.17(4), this Annex sets out commitments of each Party to recognize the 
other Party’s grading programs for beef. WT/REG160/1 
Page 26  
 
Background On The Chilean And U.S. Grading Programs 
 
 The Official Chilean “Norms” for grading beef ( Norma Chilena  1306-2002) provide for five 
categories ( V, C, U, N , and O) that differentiate the beef carcass population based on a combination of 
yield and palatability characteristics. Those character istics include sex class, maturity as determined 
by dentition, and a subjective overall fat covering score. The “ V” and “ C” classifications are perceived 
as highest in “value,” while the “ U” and “ N” classifications are considered the lowest in “value.” The 
“O” classification applies only to calves. Bulls  in Chile are only eligible for the “ U” and “ N” 
categories.  
 The Official United States Standards for Grades of Carcass Beef  outline two distinct types of 
beef grades for use in the United States – quality grades and yield grades. Beef carcasses may carry a 
quality grade, a yield grade, both a quality and a yield grade, or may be left ungraded. USDA quality grades indicate expected palatability or eating satisfaction of the meat and USDA yield grades are estimates of the percentage of a carcass that yields boneless, closely trimmed retail cuts from the 
round, loin, rib and chuck.  
  USDA beef quality grades are USDA  Prime , USDA Choice, USDA Select, USDA Standard, 
USDA Commercial, USDA Utility, USDA Cutter, and USDA Canner . Beef steers and heifers are 
eligible for all the quality grade designa tions. Cows are eligible for all but the USDA Prime grade . 
Bullocks may only be graded USDA Prime, USDA Choice, USDA Select, USDA Standard , and USDA 
Utility . Bulls may not be quality graded. 
  Because grading is voluntary in the United St ates, not all carcasses are quality graded. Beef 
products merchandised as ungraded in the United St ates usually originate from those carcasses that 
did not qualify for one of the highest three grades ( USDA Prime, USDA Choice , and USDA Select ). 
The U.S. industry generally terms ungraded beef ca rcasses and their resulting cuts as "No Roll" beef, 
because a grade stamp has not been rolled on the carcass. For the USDA quality grade standards, 
maturity and marbling are the major cons iderations in beef quality grading. 
  Because most beef that packers market in the United States is not in carcass form, but instead 
is in the form of vacuum packaged subprimal cuts , only the quality grade is routinely used as a value 
determining trait in the marketing of beef products  in the United States and ultimately passed on to the 
consumer. Accordingly, Article 3.17 and this  Annex do not apply to USDA yield grades. 
 
Commitments Regarding Mutual Recognition Of The Chilean And U.S. Grading Programs 
  The Parties confirm their shared understanding that: 
 1. Chile acknowledges that USDA’s Agricultural Marketing Service (AMS) is a competent 
entity of grading quality, certifying all materials refe rred to in Article No. 5 of Regulation No. 19.162, 
with respect to meats exported to Chile from the United States. 
2. The United States recognizes the competency of certification entities inscribed in the Registro 
de Certificadores de Carne  division of the Servicio Agrícola y Ganadero of Chile (SAG) to certify 
Chilean meats destined toward that market. 
3. AMS and SAG shall recognize each other’s resp ective beef grading systems for the purposes 
of:  WT/REG160/1 
 Page 27 
 
 
(a) the marketing of USDA graded beef in Chile;1 and 
(b) the marketing of beef classified by SAG to Chilean norms in the United States. 
4. The comparative beef cut nomenclature table set out in Appendix 3.17-A shall serve as a 
reference for the labelling of beef traded between the two markets under the terms of Article 3.17 and 
this Annex. 
5. The standards of grading systems employed by  Chile and the United States are described in 
Appendix 3.17-B. The Parties may modify Appendi x 3.17-B by means of exchanges of letters 
between the USDA, AMS and the SAG. Furtherm ore, by means of written communications, the 
USDA, AMS, and the SAG may institute and modify  standards of Chilean meat cuts and North 
American meat cuts. 
6. USDA graded beef ( e.g., USDA Prime, USDA Choice, and USDA Select ) produced in the 
United States may be exported to Chile provided that  a label indicates its Chilean equivalent and its 
country of origin. 
7. Beef produced in Chile may be exported to the United States provided that the label or sticker 
indicates the applicable Chilean norm and country of origin. 
8. AMS and SAG shall work cooperatively to assist  the beef industries of the United States and 
Chile in following these procedures. 
                                                      
1 The table comparing Chilean beef norms and USDA qu ality grades is intended to serve as a reference 
for consumers in Chile by describing USDA beef qua lity grade names in terms that are easily and already 
understood. However, this comparison is not intended to denote equivalency between the two grading systems 
for the purposes of reciprocal grading or the marketing of SAG classified beef under USDA grade names in the 
United States. WT/REG160/1 
Page 28  
 
APPENDIX 3.17-A 
 
Comparative Beef Cut Nomenclature Table / Equivalencia De Cortes
 
 
CHILE USA3 
Cuarto Delantero (Paleta) Forequarter 
Cortes sin Hueso Boneless Cuts 
1 Malaya 1 Subcutaneous muscle 
2 Plateada 2 Cup of cube roll 
3 Sobrecostilla 3 Chuck (pony) 
4 Tapapecho 4 Brisket 
5 Cogote 5 Clod and sticking 
6 Huachalomo 6 Neck 
7 Choclillo 7 Chuck tender 
8 Punta de paleta 8 Blade clod 
9 Asado del carnicero 9 Chuck cover 
10 Posta de paleta  10 Shoulder clod 
11 Lagarto 11 Shank meat 
12 Lomo vetado 12 Cube roll 
13 Entraña 13 Skirt (diaphragm) 
Cortes con Hueso Cuts with bone 
1 Asado de tira 1 Short ribs 
2 Costillas arqueadas 2 Back ribs 
3 Aletillas 3 Sternum ribs 
4 Osobuco de mano 4 Foreshank 
  
Cuarto Trasero (pierna) Hindquarter 
Cortes sin Hueso Boneless Cuts 
1 Lomo liso 1 Striploin 
2 Filete 2 Tenderloin 
3 Punta de ganso 3 Outside round 
4 Ganso 4 Silverside 
5 Pollo ganso 5 Cup of rump 
6 Posta negra 6 Top, inside, or topside round 
7 Posta rosada 7 Knuckle or sirloin tip 
8 Asiento 8 Sirloin butt 
9 Punta de picana 9 Tri – tip 
10 Tapabarriga 10 Thin flank 
11 Palanca 11 Flank steak 
12 Pollo barriga 12 Thick skirt 
13 Abastero 13 Heel (gastrocnemius) 
Cortes con Hueso Cuts with bone 
1 Coluda 1 Ribs steak 
2 Osobuco de pierna 2 Shank 
3 Cola 3 Tail 
 
                                                      
3 Proper nomenclature for beef cuts traded in the United States can be found in, and should reference, 
the U.S. Department of Agriculture's Institutional Meat Purchase Specifications (IMPS).  WT/REG160/1 
 Page 29 
 
 
APPENDIX 3.17-B 
 
Comparison Of Chilean Beef Norm s And USDA Beef Quality Grades  
 
 
Chilean Beef Norm USDA Beef Quality Grade 
V.    
• Young bulls with milk teeth (10-
24 months); Fat score 1, 2, and 3. 
• Steers, heifers, and young cows 
with 4 permanent teeth (10-34 months); Fat Score 1, 2, and 3. USDA Prime, USDA Choice, and USDA Select.   
 
• Young beef (steers and heifers) less 
than 42 months. Slight and above 
marbling. 
C.   
• Steers and cows with 6 permanent 
teeth (35-42 months); Fat Score 1, 2, and 3. USDA Standard.   
• Young beef (steers and heifers) less 
than 42 months. Practically devoid to small marbling.  
U.   
• Adult and old cows with 8 or 
leveled permanent teeth (over 43 
months); Fat Score 1,2, and 3.  
• Bulls and bullocks with 4 
permanent teeth and over; Fat 
Score 1,2, and 3. 
• Oxen with 8 permanent teeth (43-
58 months); Fat Score 1, 2, and 3. USDA Commercial, USDA Utility, USDA Cutter, 
and  USDA Canner.   
• Mature cows over 42 months. 
Practically devoid to small 
marbling. 
N.  
• All classes but calves, no teeth 
requirements; Fat Score 0. 
• Third degree bruised carcasses of 
any class; Fat Score 1, 2, and 3. 
 • USDA has separate classification 
and grade system for bullocks 
(young bulls under 24 months of age) from USDA Utility to USDA 
Prime. Mature bulls are not 
eligible for USDA quality grades 
(eligible for yield grades only). 
O.  
• Male and female calves with milk 
teeth (up to 9 months); no Fat Score requirements. United States Standards for Grades of Veal and 
Calf Carcasses . 
• There are five official USDA 
grades for veal and calf carcasses: 
USDA Prime, USDA Choice, 
USDA Good, USDA Standard, and USDA Utility . These grades 
are based on conformation, 
maturity (under 9 months determined mostly by lean color) 
and feathering and flank fat 
streaking (quality). 
 
 WT/REG160/1 
Page 30  
 
ANNEX 3.18 
 
Product Lists And Trigger Prices For Agricultural Safeguard
 
 
United States Agricultural Safeguard Product List  
 (US$ / KG.)  
HS 2002  Description  Trigger Price  
0704904020 BROCCOLI INCLUD ING SPROUTING BROCCOLI, 
FRESH OR CHILLED 0.38 
0706100500 CARROTS, REDUCED IN SIZE, FRESH OR 
CHILLED 0.46 
0709402000 CELERY OTHER THAN  CELERIAC, REDUCED IN 
SIZE, FRESH OR CHILLED 0.58 
0709700000 SPINACH, NEW ZEALAND & ORACHE 
(GARDEN), FRESH OR CHILLED 0.65 
0709904500 SWEET CORN, FRESH OR CHILLED 0.51 
07099091 VEGETABLES, NESOI, FRESH OR CHILLED 
0.70 
07149005 CHINESE WATER CHESNUTS, FRESH OR 
CHILLED 0.70 
0710808500 BRUSSELS SPROUTS REDUCED IN SIZE, RAW 
OR COOKED BY STEAMING OR BOILING, FROZEN 0.85 
07115100 MUSHROOMS OF THE GENUS AGARICUS 1.44 
0711591000 MUSHROOMS, NEOSI, PROVISIONALLY 
PRESERVED, BUT UNSUITABLE IN THAT STATE FOR IMMEDIATE CONSUMPTION 1.44 
0712202000 ONION POWDER OR FLOUR 0.77 
0712204000 ONIONS, DRIED, EXCEPT POWDER OR FLOUR 1.48 
0712904020 GARLIC POWDER OR FLOUR 0.56 
0712904040 GARLIC, DRIED 0.43 
0804400000 AVOCADOS, FRESH OR DRIED 1.05 
0807198000 MELONS, NESOI, FRESH, ENTERED 6/1 THRU 
11/30 0.28 
0811908040 CHERRIES, SWEET VARIETIES, UNCOOKED OR 
COOKED BY WATER, FROZEN 1.24 
0811908060 CHERRIES, TART VARIETIES 1.01 
0811908080 FRUITS NESOI & NUTS 0.86 
2002100020 TOMATOES WHOLE OR IN PIECES, PREPARED 
OR PRESERVED NESOI, IN CONTAINERS 
HOLDING LESS THAN 1.4 KG 0.47 
2002100080 TOMATOES WHOLE OR IN PIECES, PREPARED 
OR PRESERVED NESOI, IN CONTAINERS HOLDING 1.4 KG OR MORE 0.35 
2002908010 TOMATO PASTE IN CONTAINERS HOLDING 
LESS THAN 1.4 KG. 0.66 
2002908020 TOMATO PASTE IN CONTAINERS HOLDING 1.4 
KG. OR MORE 0.53 
2002908030 TOMATO PUREE IN CONTAINERS HOLDING 
LESS THAN 1.4 KG. 0.61  WT/REG160/1 
 Page 31 
 
 
2002908040 TOMATO PUREE IN CONTAINERS HOLDING 1.4 
KG. OR MORE 0.38 
2002908050 TOMATOES NESOI PREPARED OR PRESERVED 0.65 
2003900010 STRAW MUSHROOM PREPARED OR 
PRESERVED EXCEPT BY VINEGAR OR ACETIC 
ACID 1.39 
2003900090 OTHER MUSHROOMS 1.39 
2003100127 MUSHROOM WHOLE OR BUTTON, PREPARED 
OR PRESERVED, IN CONTAINERS HOLDING NOT MORE THAN 225 GRAMS 2.33 
2003100131 MUSHROOM SLICED, PREPARED OR 
PRESERVED, IN CONTAINERS HOLDING NOT 
MORE THAN 225 GRAMS  2.25 
2003100137 MUSHROOM NESOI, IN CONTAINERS HOLDING 
NOT MORE THAN 225 GRAMS  1.90 
2003100143 MUSHROOM WHOLE OR BUTTON, PREPARED 
OR PRESERVED, IN CONTAINERS HOLDING MORE THAN 225 GRAMS  1.68 
2003100147 MUSHROOM SLICED, PREPARED OR 
PRESERVED, IN CONTAINERS HOLDING MORE 
THAN 225 GRAMS 1.49 
2003100153 MUSHROOM NESOI, PREPARED OR PRESERVED, 
IN CONTAINERS HOLDING MORE THAN 225 
GRAMS 1.44 
2005600000 ASPARAGUS, PREPARED OR PRESERVED 
NESOI, NOT FROZEN 1.12 
2005908000 ARTICHOKES, PR EPARED OR PRESERVED 
NESOI, NOT FROZEN 1.29 
2006002000 CHERRIES, PRESERVED BY SUGAR 2.06 
2006005000 MIXTURES OF FRUIT, NUTS AND PLANT PARTS 
PRESERVED BY SUGAR 1.56 
2007100000 HOMOGENIZED PREPARATIONS OF FRUIT  1.41 
2008303500 ORANGE PULP, PREPARED OR PRESERVED 
NESOI 1.30 
2008400020 PEARS, PREPARED OR PRESERVED, NESOI, IN 
CONTAINERS HOLDING LESS THAN 1.4 KG 0.66 
2008400040 PEARS, PREPARED OR PRESERVED, NESOI, IN 
CONTAINERS 1.4 KG OR MORE 0.65 
2008504000 APRICOTS, PREPARED OR PRESERVED NESOI 0.90 
2008929030 FRUIT MIXTURES WITH PEACHES OR PEARS 
PACKED IN LIQUID, IN CONTAINERS HOLDING 
LESS THAN 1.4 KG 0.81 
2008929035 FRUIT MIXTURES WITH PEACHES OR PEARS 
PACKED IN LIQUID, IN  CONTAINTERS HOLDING 
MORE THAN 1.4 KG 0.77 WT/REG160/1 
Page 32  
 
2008929040 FRUIT MIXTURES CONTAINING ORA NGES OR 
GRAPEFRUIT  1.21 
2008929050 FRUIT MIXTURES NESOI 0.92 
2008929092 MIXTURES FRUITS, NUTS OR EDIBLE PARTS OF 
PLANTS, PREPARED CEREAL PRODUCTS, 
NEOSI, PREPARED OR PRESERVED  3.63 
2008929094 MIXTURES FRUITS, NUTS OR EDIBLE PARTS OF 
PLANTS, NEOSI, PREPARED OR PRESERVED 2.46 
2009110020 ORANGE JUICE UNFERMENTED FROZEN 
CONTAINER UNDER .946 LITER 0.25 
2103204020 TOMATO SAUCES NESOI IN CONTAINERS 
HOLDING LESS THAN 1.4 KG 0.80 
2103204040 TOMATO SAUCES NESOI IN CONTAINERS 
HOLDING 1.4 KG OR MORE 0.31 
 
 
Chile Agricultural Safeguard Product List  
 (US$ / KG.)  
HS 2002  Description  Trigger Price  
02109100 LAS DEMAS CARNES O DESPOJOS 
COMESTIBLES DE PRIMATES 3.49 
02109200 LAS DEMAS CARNES O DESPOJOS 
COMESTIBLES DE BALLENAS, DELFINES Y MARSOPAS; DE MANATIES Y DUGONES O 
DUGONGOS 3.49 
02109300 LAS DEMAS CARNES O DESPOJOS 
COMESTIBLES DE REPTILES (INCLUIDAS LAS SERPIENTES Y TORTUGAS DE MAR) 3.49 
02109900 LAS DEMAS CARNES O DESPOJOS 
COMESTIBLES 3.49 
04070010 HUEVOS DE AVES CON CASCARA, FRESCOS, 
CONSERVADOS O COCIDOS, PARA CONSUMO 23.61 
04070090 LOS DEMAS HUEVOS DE AVE CON CASCARA, 
FRESCOS, CONSERVADOS O COCIDOS 23.61 
10062000 ARROZ DESCASCARILLADO (ARROZ CARGO O 
ARROZ PARDO) 0.52 
10063010 ARROZ SEMIBLANQUEADO O BLANQUEADO, 
INCLUSO PULIDO O GLASEADO, CON UN 
CONTENIDO DE GRANO PARTIDO INFERIOR O 
IGUAL AL 5% EN PESO 0.27 
10063020 ARROZ SEMIBLANQUEADO O BLANQUEADO, 
INCLUSO PULIDO O GLASEADO, CON UN 
CONTENIDO DE GRANO PARTIDO SUPERIOR AL 
5% PERO INFERIOR O IGUAL AL 15% EN PESO 0.27 
10063090 LOS DEMAS ARROZ SEMIBLANQUEADO O 
BLANQUEADO, INCLUSO PULIDO O GLASEADO0.27 
10064000 ARROZ PARTIDO 0.21 
11023000 HARINA DE ARROZ 0.74 
11031100 GRANONES Y SEMOLA, DE TRIGO 0.35 
11081100 ALMIDON DE TRIGO 0.30 
11090000 GLUTEN DE TRIGO, INCLUSO SECO 0.85  WT/REG160/1 
 Page 33 
 
 
CHAPTER FOUR: RULES OF ORIGIN AND ORIGIN PROCEDURES 
 
Section A - Rules Of Origin  
 
Article 4.1 
 
Originating Goods  
 1. Except as otherwise provided in this Chapter, a good is originating where: 
(a) the good is wholly obtained or produced entirely in the territory of one or both of the 
Parties; 
(b) the good is produced entirely in the territory of one or both of the Parties and 
(i) each of the non-originating materials used in the production of the good 
undergoes an applicable change in tari ff classification specified in Annex 4.1, 
or 
(ii) the good otherwise satisfies any applicab le regional value content or other 
requirements specified in Annex 4.1,  
and the good satisfies all other applicab le requirements of this Chapter; or 
(c) the good is produced entirely in the territory of one or both of the Parties exclusively 
from originating materials. 
2. A good shall not be considered to be an originating good and a material shall not be 
considered to be an originating mate rial by virtue of having undergone: 
(a) simple combining or packaging operations; or 
(b) mere dilution with water or with another s ubstance that does not materially alter the 
characteristics of the good or material. 
Article 4.2 
 
Regional Value Content
 
 1. Where Annex 4.1 specifies a regional value content test to determine whether a good is 
originating, each Party shall provide that the pers on claiming preferential tariff treatment for the good 
may calculate regional value content on the basis of one or the other of the following methods: 
(a) Builddown method 
  RVC = AV - VNM
 x 100 
          AV  
(b) Buildup method 
  RVC = VOM
 x 100 
      A V   where  RVC is the regional value content, expressed as a percentage; WT/REG160/1 
Page 34  
 
  AV is the adjusted value;    VNM is the value of non-originating materials used by the producer in the 
production of the good; and 
 
VOM is the value of originating materials used by the producer in the production of 
the good. 
 
Article 4.3 
 
Value Of Materials
 
 1. Each Party shall provide that for purposes of calculating the regional value content of a good, 
and for purposes of applying the de minimis  rule, the value of a material: 
(a) for a material that is imported by the produ cer of the good, is the adjusted value of the 
material with respect to that importation; 
(b) for a material acquired in the territory wh ere the good is produced, is the producer’s 
price actually paid or payable for the ma terial, except for materials within the 
meaning of subparagraph (c); 
(c) for a material provided to the producer without charge, or at a price reflecting a 
discount or similar reduction, is determined by computing the sum of: 
(i) all expenses incurred in the growth, production, or manufacture of the 
material, including general expenses; and 
(ii) an amount for profit; and 
(d) for a material that is self-produced, is determined by computing the sum of: 
(i) all expenses incurred in the production of the material, including general 
expenses; and 
(ii) an amount for profit. 
2. Each Party shall provide that the person clai ming preferential tariff treatment for a good may 
adjust the value of materials as follows: 
(a) for originating materials, the following e xpenses may be added to the value of the 
material where not included under paragraph 1: 
(i) the costs of freight, insurance, pack ing, and all other costs incurred in 
transporting the material to the location of the producer; 
(ii) duties, taxes, and customs brokerage fees on the material paid in the territory 
of one or both of the Parties, other than duties and taxes that are waived, refunded, refundable, or otherwise r ecoverable, including credit against duty 
or tax paid or payable; and 
(iii) the cost of waste and spoilage resultin g from the use of the material in the 
production of the good, less the value of renewable scrap or byproduct.  WT/REG160/1 
 Page 35 
 
 
(b) for non-originating materials, the followi ng expenses may be deducted from the value 
of the material where included under paragraph 1: 
(i) the costs of freight, insurance, pack ing, and all other costs incurred in 
transporting the material to the location of the producer; 
(ii) duties, taxes, and customs brokerage fees on the material paid in the territory 
of one or both of the Parties, other than duties and taxes that are waived, 
refunded, refundable, or otherwise r ecoverable, including credit against duty 
or tax paid or payable; 
(iii) the cost of waste and spoilage resultin g from the use of the material in the 
production of the good, less the value of  renewable scrap or  byproducts; and 
(iv) the cost of originating materials used in the production of the non-originating 
material in the territory of a Party. 
Article 4.4 
 
Accessories, Spare Parts, And Tools  
 
 Each Party shall provide that accessories, spare parts, or tools delivered with a good that form 
part of the good’s standard accessories, spare parts, or tools, shall be regarded as a material used in the 
production of the good, provided that:   
(a) the accessories, spare parts, or tools are cl assified with and not invoiced separately 
from the good; and 
(b) the quantities and value of the accessories, spar e parts, or tools are customary for the 
good. 
Article 4.5 
 
Fungible Goods And Materials
 
 1. Each Party shall provide that the person clai ming preferential tariff treatment for a good may 
claim that a fungible good or material is originating based on either the physical segregation of each fungible good or material, or through the use of  any inventory management method, such as 
averaging, last-in, first-out, or first-in, first- out, recognized in the Generally Accepted Accounting 
Principles of the Party in which the production is performed or otherwise accepted by the Party in 
which the production is performed. 
2. Each Party shall provide that the inventor y management method selected under paragraph 1 
for particular fungible goods or materials shall c ontinue to be used for those goods or materials 
throughout the fiscal year of the person that  selected the inventory management method. 
Article 4.6 
 
Accumulation
 
 1. Each Party shall provide that originating goods or materials of a Party, incorporated into a 
good in the territory of the other Party, shall be cons idered to originate in the territory of the other 
Party. WT/REG160/1 
Page 36  
 
2. Each Party shall provide that a good is originating where the good is produced in the territory 
of one or both Parties by one or more producers, provided that the good satisfies the requirements in 
Article 4.1 and all other applicable  requirements in this Chapter. 
Article 4.7 
 
De Minimis  Rule
 
 1. Each Party shall provide that a good that do es not undergo a change in tariff classification 
pursuant to Annex 4.1 is nonetheless originating if the value of all non-originating materials that are 
used in the production of the good and that do not undergo the applicable change in tariff 
classification does not exceed 10 percent of the adjust ed value of the good, provided that the value of 
such non-originating materials shall be included in  the value of non-originating materials for any 
applicable regional value content requirement and that the good meets all other applicable 
requirements in this Chapter. 
2. Paragraph 1 does not apply to: 
(a) a non-originating material provided for in Chapter 4 of the Harmonized System, or a 
non-originating dairy preparation containing over 10 percent by weight of milk solids 
provided for in subheadings 1901.90 or 2106. 90 of the Harmonized System, that is 
used in the production of a good provided for in Chapter 4 of the Harmonized System; 
(b) a non-originating material provided for in Chapter 4 of the Harmonized System, or 
non-originating dairy preparations contai ning over 10 percent by weight of milk 
solids provided for in subheading 1901.90 of the Harmonized System, that are used in the production of the following goods: infant preparations containing over 10 percent 
in weight of milk solids provided for in subheading 1901.10 of the Harmonized System; mixes and doughs, containing over 25 percent by weight of butterfat, not put 
up for retail sale, provided for in subheading 1901.20 of the Harmonized System; 
dairy preparations containing over 10 percent by weight of milk solids provided for in 
subheadings 1901.90 or 2106.90 of the Ha rmonized System; goods provided for in 
heading 2105 of the Harmonized System; be verages containing milk provided for in 
subheading 2202.90 of the Harmonized System; or animal feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90 of the 
Harmonized System; 
(c) a non-originating material provided for in heading 0805 of the Harmonized System or 
subheadings 2009.11 through 2009.30 of the Harmonized System that is used in the production of a good provided for in subheadings 2009.11 through 2009.30 of the Harmonized System, or in fruit or vegetable juice of any single fruit or vegetable, 
fortified with minerals or vitamins, con centrated or unconcentrated, provided for in 
subheadings 2106.90 or 2202.90 of the Harmonized System; 
(d) a non-originating material provided for in Ch apter 15 of the Harmonized System that 
is used in the production of a good provided for in headings 1501 through 1508, 1512, 1514, or 1515 of the Harmonized System; 
(e) a non-originating material provided for in heading 1701 of the Harmonized System 
that is used in the production of a good provided for in headings 1701 through 1703 
of the Harmonized System;  WT/REG160/1 
 Page 37 
 
 
(f) a non-originating material provided for in Chapter 17 or in heading 1805 of the 
Harmonized System that is used in the production of a good provided for in subheading 1806.10 of the Harmonized System; 
(g) a non-originating material provided for in headings 2203 through 2208 of the 
Harmonized System that is used in the production of a good provided for in heading 
2207 or 2208 of the Harmonized System; and 
(h) a non-originating material used in the pr oduction of a good provided for in Chapters 1 
through 21 of the Harmonized System unl ess the non-originating material is provided 
for in a different subheading than the good for which origin is being determined 
under this Article. 
3. With respect to a textile and apparel good pr ovided for in Chapters 50 through 63 of the 
Harmonized System, Article 3.20(6) (Rules of Or igin and Related Matters) applies in place of 
paragraph 1. 
Article 4.8 
 
Indirect Materials Used In Production
 
  Each Party shall provide that an indirect mate rial shall be considered to be an originating 
material without regard to where it is produced.  
Article 4.9 
 
Packaging Materials And Containers For Retail Sale
 
  Each Party shall provide that packaging materi als and containers in which a good is packaged 
for retail sale, if classified with the good, sha ll be disregarded in determining whether all non-
originating materials used in the production of th e good undergo the applicable change in tariff 
classification set out in Annex 4.1, and, if the good is subject to a regional value content requirement, 
the value of such packaging materials and containers  shall be taken into account as originating or non-
originating materials, as the case may be, in cal culating the regional value content of the good. 
 
Article 4.10 
 
Packing Materials And Containers For Shipment
 
  Each Party shall provide that packing mate rials and containers for shipment shall be 
disregarded in determining whether: 
 
(a) the non-originating materials used in the production of the good undergo an 
applicable change in tariff classifi cation set out in Annex 4.1; and 
(b) the good satisfies a regional value content requirement. 
Article 4.11 
 
Transit And Transshipment
 
 1. Each Party shall provide that a good shall not be  considered an originating good if the good 
undergoes subsequent production or any other operati on outside the territories of the Parties, other WT/REG160/1 
Page 38  
 
than unloading, reloading, or any other process nece ssary to preserve the good in good condition or to 
transport the good to the territory of a Party. 
2. The importing Party may require that a person claiming that a good is originating 
demonstrate, to the satisfaction of the Party’s cust oms authority, that any subsequent operations on the 
good performed outside the territories of the Parti es comply with the requirements in paragraph 1. 
 
Section B - Origin Procedures
 
 
Article 4.12 
 
Claims Of Origin  
 1. Each Party shall require that an importer cl aiming preferential tariff treatment for a good: 
(a) make a written declaration in the importation document that the good qualifies as 
originating; 
(b) be prepared to submit, on the request of the importing Party’s customs authority, a 
certificate of origin or information demonstrating that the good qualifies as 
originating; 
(c) promptly make a corrected declaration and pay any duties owing where the importer 
has reason to believe that the certificate or  other information on which the declaration 
was based is incorrect. 
2. Each Party, where appropriate, may request that an importer claiming preferential tariff 
treatment for a good demonstrate to the Party’ s customs authority that the good qualifies as 
originating under Section A, including that the good satisfies the requirements in Article 4.11. 
3. Each Party shall provide that, where an orig inating good was imported into the territory of 
that Party but no claim for preferential tariff treat ment was made at the time of importation, the 
importer of the good may, no later than one year af ter the date on which the good was imported, apply 
for a refund of any excess duties paid as the result of the good not having been accorded preferential 
tariff treatment, on presentation of: 
(a) a written declaration that the good qualified as originating at the time of importation; 
(b) a copy of a certificate of origin or othe r information demonstrating that the good 
qualifies as originating; and 
(c) such other documentation relating to the importation of the good as the importing 
Party may require. 
Article 4.13 
 
Certificates Of Origin
 
 
1. Each Party shall provide that an importer ma y satisfy a request under Article 4.12(1)(b) by 
providing a certificate of origin that sets forth a valid  basis for a claim that a good is originating. Each 
Party shall provide that the certificate of origin n eed not be in a prescribed format, and that the 
certificate may be submitted electronically.  WT/REG160/1 
 Page 39 
 
 
2. Each Party shall provide that a certificate of orig in may be issued by the importer, exporter, or 
producer of the good. Where an exporter or importer is not the producer of the good, each Party shall 
provide that the exporter or importer may issue a certificate of origin based on: 
(a) a certificate of origin issued by the producer; or 
(b) knowledge of the exporter or importer that the good qualifies as an originating good. 
3. Each Party shall provide that a certificate of origin may cover the importation of one or more 
goods or several importations of identical goods within a period specified in the certificate. 
4. Each Party shall provide that a certificate of or igin is valid for four years from the date on 
which the certificate was issued. 
5. A Party may require that a certificate of or igin for a good imported into its territory be 
completed in either Spanish or English. 
6. For an originating good that is imported into the territory of a Party on or after the date of 
entry into force of this Agreement, each Party sh all accept a certificate of origin issued by the 
importer, exporter, or producer of the good prio r to that date, unless th e Party possesses information 
indicating that the certificate is invalid. 
7. Neither Party may require a certificate of origin or information demonstrating that the good 
qualifies as originating for: 
(a) the importation of goods with a customs value not exceeding US$2,500, or the 
equivalent amount in Chilean currency, or  such higher amount as may be established 
by the importing Party; or 
(b) the importation of other goods as may be id entified in the importing Party’s laws 
governing claims of origin under this Agreement, 
unless the importation can be considered to have been carried out or planned for the purpose of 
evading compliance with the Part y’s laws governing claims of or igin under this Agreement. 
 
Article 4.14 
 
Obligations Relating To Importations  
 1. Each Party shall provide that the importer is responsible for submitting a certificate of origin 
or other information demonstrating that the good qualif ies as originating, for the truthfulness of the 
information and data contained therein, for s ubmitting any supporting documents requested by the 
Party’s customs authority, and for the truthfulness of the information contained in those documents. 
2. Each Party shall provide that the fact that the importer has issued a certificate of origin based 
on information provided by the exporter or the producer shall not relieve the importer of the responsibility referred to in paragraph 1. 
3. Each Party shall provide that an importer claiming preferential tariff treatment for a good 
imported into the Party’s territory shall maintain, for a period of five years after the date of 
importation of the good, a certificate of origin or  other information demonstrating that the good 
qualifies as originating, and all other documents that  the Party may require relating to the importation 
of the good, including records associated with:  WT/REG160/1 
Page 40  
 
(a) the purchase, cost, value of, and payment for, the good; 
(b) where appropriate, the purchase, cost, value of, and payment for, all materials, 
including recovered goods and indirect mate rials, used in the production of the good; 
and 
(c) where appropriate, the production of the good in its exported form.  
Article 4.15 
 
Obligations Relating To Exportations
 
 1. For purposes of cooperation under Article 5.5 (Coope ration), each Party shall provide that an 
exporter or producer that issues a certificate of origin for a good exported from the Party’s territory 
shall provide a copy of the certificate to th e Party’s customs authority upon its request. 
2. Each Party shall provide that an exporter or produ cer that has issued a certificate of origin for 
a good exported from the Party’s territory shall maintain , for a period of at least five years after the 
date the certificate was issued, all records and suppor ting documents related to the origin of the good, 
including: 
(a) purchase, cost, value of, and payment for, the good; 
(b) where appropriate, the purchase, cost, value of, and payment for, all materials, 
including recovered goods, used in the production of the good; and 
(c) where appropriate, the production of the good  in the form in which it was exported. 
3. Each Party shall provide that where an exporter or producer has issued a certificate of origin, 
and has reason to believe that the certificate contains or is based on incorrect information, the exporter 
or producer shall immediately notify, in writing,  every person to whom the exporter or producer 
issued the certificate of any change that could affect  the accuracy or validity of the certificate. Neither 
Party may impose penalties on an exporter or produ cer in its territory for issuing an incorrect 
certificate if it voluntarily provides written notif ication in conformity with this paragraph. 
Article 4.16 
 
Procedures For Verification Of Origin
 
 1. Each Party shall grant any claim for preferentia l tariff treatment made in accordance with this 
Section, unless the Party possesses information indicating that the importer’s claim fails to comply 
with any requirement under Section A or Article 3.20 (Rules of Origin and Related Matters), except 
as otherwise provided in Article 3.21 (Customs Cooperation). 
2. To determine whether a good imported into its territory qualifies as originating, the importing 
Party may, through its customs authority, verify the origin in accordance w ith its customs laws and 
regulations. 
3. Where a Party denies a claim for preferential tariff treatment, it shall issue a written 
determination containing findings of  fact and the legal basis for its determination. The Party shall 
issue the determination within a period established under its law. 
4. A Party shall not subject an importer to penalties where the importer that made an incorrect 
declaration voluntarily makes a corrected declaration.  WT/REG160/1 
 Page 41 
 
 
5. Where a Party determines through verification th at an importer has certified more than once, 
falsely or without substantiation, that a good qualifies as originating, the Party may suspend preferential tariff treatment to identical goods impor ted by that person until the importer proves that it 
has complied with the Party’s laws and regulations go verning claims of origin under this Agreement. 
6. Each Party that carries out a verification of origin in which Generally Accepted Accounting 
Principles are pertinent shall apply those principles in  the manner that they are applied in the territory 
of the Party from which the good was exported. 
Article 4.17 
 
Common Guidelines
 
 
 By the date of entry into force of this Ag reement, the Parties shall agree on and publish 
common guidelines for the interpretation, applicati on, and administration of this Chapter and the 
relevant provisions of Chapter Three (Nati onal Treatment and Market Access for Goods). As 
appropriate, the Parties may subsequently agree to modify the common guidelines. 
 
 
Section C - Definitions  
 
Article 4.18 
 
Definitions  
  For purposes of this Chapter:   adjusted value  means the value determined in accord ance with Articles 1 through 8, Article 
15, and the corresponding interpretative notes of th e Customs Valuation Agreement, adjusted, if 
necessary, to exclude any costs, charges, or e xpenses incurred for transportation, insurance, and 
related services incident to the international sh ipment of the merchandise from the country of 
exportation to the place of importation;   exporter  means a person who exports goods from the territory of a Party; 
 
 fungible goods or materials  means goods or materials that are interchangeable for 
commercial purposes and whose properties are essentially identical;   Generally Accepted Accounting Principles  means the principles, rules, and procedures, 
including both broad and specific guidelines, that define the accounting practices accepted in the 
territory of a Party;   good  means any merchandise, product, article, or material; 
 
 goods wholly obtained or produced entirely in the territory of one or both of the Parties  
means: 
 
(a) mineral goods extracted in the territory of one or both of the Parties; 
(b) vegetable goods, as such goods are defined in  the Harmonized System, harvested in 
the territory of one or both of the Parties; 
(c) live animals born and raised in the terri tory of one or both of the Parties; WT/REG160/1 
Page 42  
 
(d) goods obtained from hunting, trapping, or fishing in the territory of one or both of the 
Parties; 
(e) goods (fish, shellfish, and other marine life) taken from the sea by vessels registered 
or recorded with a Party and flying its flag; 
(f) goods produced on board factory ships from the goods referred to in subparagraph (e) 
provided such factory ships are registered or recorded with that Party and fly its flag; 
(g) goods taken by a Party or a person of a Party from the seabed or beneath the seabed 
outside territorial waters, provided that a Party has rights to exploit such seabed; 
(h) goods taken from outer space, provided they are obtained by a Party or a person of a 
Party and not processed in the territory of a non-Party; 
(i) waste and scrap derived from 
(i) production in the territory of one or both of the Parties, or 
(ii) used goods collected in the territory of one or both of the Parties, provided 
such goods are fit only for the recovery of raw materials; 
(j) recovered goods derived in the territory a Party from used goods, and utilized in the 
Party’s territory in the production of remanufactured goods; and 
(k) goods produced in the territory of one or both of the Parties exclusively from goods 
referred to in subparagraphs (a ) through (i), or from their derivatives, at any stage of 
production; 
 importer  means a person who imports goods into the territory of a Party; 
 
 indirect material  means a good used in the production, testing, or inspection of a good but 
not physically incorporated into the good, or a g ood used in the maintenance of buildings or the 
operation of equipment associated with the production of a good, including:  
 
(a) fuel and energy; 
(b) tools, dies, and molds; 
(c) spare parts and materials used in the maintenance of equipment and buildings; 
(d) lubricants, greases, compounding materials, and other materials used in production or 
used to operate equipment and buildings; 
(e) gloves, glasses, footwear, clothing, safety equipment, and supplies;  
(f) equipment, devices, and supplies used for testing or inspecting the goods; 
(g) catalysts and solvents; and 
(h) any other goods that are not incorporated into the good but whose use in the 
production of the good can reasonably be de monstrated to be a part of that 
production;  WT/REG160/1 
 Page 43 
 
 
 issued  means prepared by and, where required und er a Party’s domestic law or regulation, 
signed by the importer, exporter, or producer of the good;   location of the producer means site of production of a good; 
 
 material  means a good that is used in the production of another good, including a part, 
ingredient, or indirect material;   non-originating good or non-originating material  means a good or material that does not 
qualify as originating under this Chapter; 
 
 packing materials and containers for shipment  means the goods used to protect a good 
during its transportation, and does not include the packaging materials and containers in which a good 
is packaged for retail sale;  
 producer  means a person who engages in the producti on of a good in the territory of a Party; 
  production means growing, mining, harvesting, fi shing, raising, trapping, hunting, 
manufacturing, processing, assembling, or disassembling a good;   recovered goods  means materials in the form of indivi dual parts that are the result of: (1) the 
complete disassembly of used goods into individual pa rts; and (2) the cleaning, inspecting, testing, or 
other processing of those parts as necessary for im provement to sound working condition one or more 
of the following processes: welding, flame spraying, surface machining, knurling, plating, sleeving, 
and rewinding in order for such parts to be assemble d with other parts, includi ng other recovered parts 
in the production of a remanufactured good of Annex 4.18; 
 
 remanufactured goods  means industrial goods assembled in the territory of a Party, listed in 
Annex 4.18, that: (1) are entirely or partially compri sed of recovered goods; and (2) have the same life 
expectancy and meet the same performance standa rds as new goods; and (3) enjoy the same factory 
warranty as such new goods;  
 self-produced material  means an originating material that is produced by a producer of a 
good and used in the production of that good; and   value  means the value of a good or material for purposes of calculating customs duties or for 
purposes of applying this Chapter. WT/REG160/1 
Page 44  
 
ANNEX 4.18 
 
 Goods classified in the following Harmonized  System subheadings may be considered 
remanufactured goods, except for those designed principally for use in automotive goods of 
Harmonized System headings or subheadings 8702, 8703, 8704.21, 8704.31, 8704.32, 8706, and 
8707: 
 8408.10 8408.20 8408.90 
8409.91 
8409.99 8412.21 8412.29 8412.39 
8412.90 
8413.30 8413.50 8413.60 8413.91 8414.30 
8414.80 
8414.90 8419.89 8431.20 8431.49 
8481.20 
8481.40 8481.80 8481.90 8483.10 8483.30 
8483.40 
8483.50 8483.60 8483.90 8503.00 
8511.40 
8511.50 8526.10 8537.10 8542.21 8708.31 
8708.39 
8708.40 8708.60 8708.70 8708.93 
8708.99 
9031.49   WT/REG160/1 
 Page 45 
 
 
CHAPTER FIVE : CUSTOMS ADMINISTRATION 
 
Article 5.1 
 
Publication  
 
1. Each Party shall publish its customs laws, re gulations, and administrative procedures on the 
Internet or a comparable computer-based telecommunications network. 
2. Each Party shall designate one or more inquiry  points to address inquiries from interested 
persons concerning customs matters, and shall make available on the Internet information concerning 
procedures for making such inquiries. 
3. To the extent possible, each Party shall pub lish in advance any re gulations of general 
application governing customs matters that it propos es to adopt and provide interested persons the 
opportunity to comment on such proposed regulations prior to their adoption. 
Article 5.2 
 
Release Of Goods  
  Each Party shall:  
(a) adopt or maintain procedures providing for the release of goods within a period of 
time no greater than that required to ensure compliance with its customs laws and, to 
the extent possible, within 48 hours of arrival;  
(b) adopt or maintain procedures allowing, to the extent possible, goods to be released at 
the point of arrival, without temporary transfer to warehouses or other locations; 
(c) adopt or maintain procedures allowing the release of goods prior to, and without 
prejudice to, the final determination by its customs authority of the applicable 
customs duties, taxes and fees
1; and 
(d) otherwise endeavor to adopt or maintain simplified procedures for the release of 
goods. 
Article 5.3 
 
Automation  
  Each Party’s customs authority shall:  
(a) endeavor to use information technol ogy that expedites procedures; and 
(b) in deciding on the information technology to be used for this purpose, take into 
account international standards. 
 
 
                                                     
 
1 A Party may require an importer to provide sufficient  guarantee in the form of a surety, a deposit, or 
some other appropriate instrument, covering the ultimate payment of the customs duties for which the goods 
may be liable. WT/REG160/1 
Page 46  
 
Article 5.4 
 
Risk Assessment
 
  Each Party shall endeavor to adopt or mainta in risk management systems that enable its 
customs authority to concentrate inspection activ ities on high risk goods and that simplify the 
clearance and movement of low risk goods.  
Article 5.5 
 
Cooperation
 
 1. Each Party shall endeavor to provide the othe r Party with advance notice of any significant 
modification of administrative policy regarding the im plementation of its customs laws that is likely 
to substantially affect the operation of this Agreement. 
2. The Parties shall cooperate in achieving complianc e with their laws and regulations pertaining 
to: 
(a) the implementation and operation of the provisions of this Agreement relating to the 
importation of goods, including Chapter Th ree (National Treatment and Market 
Access for Goods), Chapter Four (Rules of Origin and Origin Procedures), and this 
Chapter; 
(b) the implementation and operation of the Customs Valuation Agreement; 
(c) restrictions or prohibitions  on imports or exports; or 
(d) such other customs matters as the Parties may agree. 
3. Where a Party has a reasonable suspicion of unlawf ul activity related to its laws or regulations 
governing importations, the Party may request that the other Party provide specific confidential 
information normally collected by the other Part y in association with the importation of goods 
pertaining to trade transactions relevant to that ac tivity. The Party shall make  its request in writing, 
shall identify the requested informa tion with sufficient specificity for the other Party to locate it, and 
shall specify the purposes for which the information is sought. 
4. The other Party shall respond by providing any information that it has collected that is 
material to the request. 
5. For purposes of paragraph 3, a reasonable suspicion of unlawful activity means a suspicion 
based on relevant factual information obtaine d from public or private sources, including: 
(a) historical evidence that a specific importer, exporter, producer, or other enterprise 
involved in the movement of goods from the territory of one Party to the territory of the other Party has not complied with a Party’s laws or regulations governing 
importations; 
(b) historical evidence that some or all of th e enterprises involved in the movement from 
the territory of one Party to the territory of the other Party of goods within a specific product sector have not complied with a Pa rty’s laws or regulations governing 
importations; or  WT/REG160/1 
 Page 47 
 
 
(c) other information that the Parties agree is sufficient in the context of a particular 
request. 
6. Each Party shall endeavor to provide the other Party with any other information that would 
assist in determining whether imports from or expor ts to the other Party are in compliance with the 
other Party’s laws or regulations governing importations, in particular  those related to the prevention 
of unlawful activities. 
7. Each Party shall endeavor to provide the other with technical advice and assistance for the 
purpose of improving risk assessment techniques, si mplifying and expediting customs procedures, 
advancing technical skills, and enhancing the use of technologies that can lead to improved 
compliance with laws and regul ations governing importations. 
8. Building on the procedures established in this Ar ticle, the Parties shall use best efforts to 
explore additional avenues of coope ration to enhance each Party’s ability to enforce its laws and 
regulations governing importations, including by: 
(a) concluding a mutual assistance agreement between their respective customs 
authorities within six months after the date of  entry into force of this Agreement; and 
(b) considering whether to establish additional channels of communication to facilitate 
the secure and rapid exchange of info rmation and to impr ove coordination on 
customs issues. 
Article 5.6 
 
Confidentiality  
 
1. Where a Party providing information to the ot her Party in accordan ce with this Chapter 
designates the information as confidential, the othe r Party shall maintain the confidentiality of the 
information. The Party providing the information may, in accordance with its domestic law, require 
written assurances from the other Party that the info rmation will be held in confidence, will be used 
only for the purposes specified in the other Party’s re quest for information, and will not be disclosed 
without the Party’s specific permission. 
2. A Party may decline to provide information re quested by the other Party where the other 
Party has failed to act in conformity with assurances provided under paragraph 1. 
3. Each Party shall adopt or maintain procedures in which confidential information, including 
information the disclosure of which could prejud ice the competitive position of the person providing 
the information, submitted in connection with the Pa rty’s administration of its customs laws shall be 
protected from unauthorized disclosure. 
Article 5.7 
 
Express Shipments  
 
 Each Party shall adopt or maintain separa te, expedited customs pr ocedures for express 
shipments, while maintaining appropriate custom s control and selection, including procedures: 
 
(a) in which the information necessary for th e release of an express shipment may be 
submitted, and processed by the Party’s customs authority, prior to the arrival of the 
shipment; WT/REG160/1 
Page 48  
 
(b) allowing a shipper to submit a single manifest covering all goods contained in a 
shipment transported by the express shipme nt service, through, if possible, electronic 
means; 
(c) that, to the extent possible, minimize the documentation required for the release of 
express shipments; and 
(d) that, under normal circumstances, allow for an express shipment that has arrived at a 
point of entry to be released no later th an six hours after the submission of the 
information necessary for release. 
Article 5.8 
 
Review And Appeal
 
  Each Party shall ensure that with respect to its determinations on customs matters, importers 
in its territory have access to:  
(a) administrative review independent of the official or office that issued the 
determination; and 
(b) judicial review of the determination or  decision taken at the final level of 
administrative review. 
Article 5.9 
 
Penalties
 
  Each Party shall adopt or maintain measur es that provide for the imposition of civil, 
administrative, and, where appropriate, criminal sa nctions for violations of its customs laws and 
regulations, including those governing tariff classificati on, customs valuation, rules of origin, and the 
entitlement to preferential tariff treatment under this Agreement. 
 
Article 5.10 
 
Advance Rulings
 
 
1. Each Party, through its customs authority, sh all issue written advance rulings prior to the 
importation of a good into its territory at the written  request of an importer in its territory, or an 
exporter or producer in the territory of the other Pa rty, on the basis of the facts and circumstances 
provided by the requester, concerning: 
(a) tariff classification; 
(b) the application of customs valuation criteria for a particular case, in accordance with 
the application of the provisions set fort h in the Customs Valuation Agreement; 
(c) duty drawback; 
(d) whether a good qualifies as an originating good under Chapter Four (Rules of Origin 
and Origin Procedures); and 
(e) whether a good qualifies for duty-free treatme nt in accordance with Article 3.9 
(Goods Re-entered after Repair or Alteration).  WT/REG160/1 
 Page 49 
 
 
2. Each Party shall provide that its customs author ity shall issue advance rulings within 150 days 
of a request, provided that the requester has submitted all necessary information. 
3. Each Party shall provide that advance rulings sha ll be in force from their date of issuance, or 
such other date specified by the rulin g, for at least three years, provid ed that the facts or circumstances 
on which the ruling is based remain unchanged. 
4. The issuing Party may modify or revoke an advance ruling where facts or circumstances 
warrant, such as where the information on which the ruling is based is false or inaccurate. 
5. Where an importer claims th at the treatment ac corded to an imported good should be 
governed by an advance ruling, the customs authority may evaluate whether the facts and circumstances of the importation are consistent with the facts and circumstances upon which the 
advance ruling was based. 
6. Each Party shall make its advance rulings pu blicly available, subject to confidentiality 
requirements in its domestic law, for purposes of promoting the consistent application of advance 
rulings to other goods. 
7. If a requester provides false information or omits relevant circumstances or facts in its request 
for an advance ruling, or does not act in accord ance with the ruling’s terms and conditions, the 
importing Party may apply appropriate  measures, including civil, criminal, and administrative actions, 
penalties, or other sanctions. 
Article 5.11 
 
Implementation
 
 
1. With respect to the obligations of Chile, Articles 5.1(1) and (2), 5.7(b), and 5.10(1)(b) shall 
enter into force three years after the date of entry into force of this Agreement. 
2. Within 120 days after the date of entry into fo rce of this Agreement, the Parties shall consult 
on the procedures that Chile needs to adopt to implement Article 5.10(1)(b) and on related technical 
assistance to be provided by the United States, and shall establish a work program outlining the steps 
needed for Chile to implement Article 5.10(1)(b). 
3. Not later than 18 months after the date of entry into force of this Agreement, the Parties shall 
consult to discuss the progress made by Chile in implementing Article 5.10(1)(b) and to consider 
whether to engage in further cooperative efforts. WT/REG160/1 
Page 50  
 
CHAPTER SIX : SANITARY AND PHYTOSANITARY MEASURES 
 
Objectives
 
  The objectives of this Chapter are to protect hu man, animal, and plant h ealth conditions in the 
Parties’ territories, enhance the Parties’ implem entation of the SPS Agreement, provide a forum for 
addressing bilateral sanitary and phytosanitary matters , resolve trade issues, and thereby expand trade 
opportunities.  
Article 6.1 
 
Scope And Coverage
 
  This Chapter applies to all sanitary and phyto sanitary measures of a Party that may, directly 
or indirectly, affect trade between the Parties. 
 
Article 6.2 
 
General Provisions
 
 1. Further to Article 1.3 (Relation to Other Agreem ents), the Parties affirm their existing rights 
and obligations with respect to each other under the SPS Agreement. 
2. Neither Party may have recourse to dispute settlement under this Agreement for any matter 
arising under this Chapter. 
Article 6.3 
 
Committee On Sanitary And Phytosanitary Matters
 
 1. The Parties hereby agree to establish a Comm ittee on Sanitary and Phytosanitary Matters 
comprising representatives of each Party who ha ve responsibility for sanitary and phytosanitary 
matters. 
2. The Parties shall establish the Committee not later than 30 days after the date of entry into 
force of this Agreement through an exchange of letters identifying the primary representative of each 
Party to the Committee and establishing the Committee’s terms of reference. 
3. The objectives of the Committee shall be to enha nce the implementation by each Party of the 
SPS Agreement, protect human, animal, and plan t life and health, enhance consultation and 
cooperation on sanitary and phytosanitary matters , and facilitate trade between the Parties. 
4. The Committee shall seek to enhance any present or  future relationships between the Parties’ 
agencies with responsibility for sanitary and phytosanitary matters. 
5. The Committee shall provide a forum for:  
(a) enhancing mutual understanding of each Party’s sanitary and phytosanitary measures 
and the regulatory processes that relate to those measures; 
(b) consulting on matters related to the deve lopment or application of sanitary and 
phytosanitary measures that affect, or may affect, trade between the Parties;  WT/REG160/1 
 Page 51 
 
 
(c) consulting on issues, positions, and agendas for meetings of the WTO SPS Committee , 
the various Codex  committees (including the Codex Alimentarius Commission ), the 
International Plant Protection Convention , the International Office of Epizootics , and 
other international and regional for a on  food safety and human, animal, and plant 
health; 
(d) coordinating technical cooperation program s on sanitary and phytosanitary matters; 
(e) improving bilateral understa nding related to specific implementation issues 
concerning the SPS Agreement; and 
(f) reviewing progress on addressing sanitary and phytosanitary matters that may arise 
between the Parties’ agencies with  responsibility for such matters. 
6. The Committee shall meet at least once a year unless the Parties otherwise agree. 
7. The Committee shall perform its work in accordance with the terms of reference referenced in 
paragraph 2. The Committee may revise the terms of  reference and may develop procedures to guide 
its operation. 
8. Each Party shall ensure that appropriate  representatives with responsibility for the 
development, implementation, a nd enforcement of sanitary and phytosanitary measures from its 
relevant trade and regulatory agencies or ministri es participate in meetings of the Committee. The 
official agencies and ministries of each Party resp onsible for such measures shall be set out in the 
Committee’s terms of reference. 
9. The Committee may agree to establish ad hoc  working groups in accordance with the 
Committee’s terms of reference. 
Article 6.4 
 
Definitions  
  For purposes of this Chapter, sanitary or ph ytosanitary measure means any measure referred 
to in Annex A, paragraph 1, of the SPS Agreement. 
  
CHAPTER SEVEN : TECHNICAL BARRIERS TO TRADE 
 
Objectives
 
 
 The objectives of this Chapter are to increase and facilitate trade thr ough the improvement of 
the implementation of the TBT Agreement, the elimin ation of unnecessary technical barriers to trade,  
and the enhancement of bilateral cooperation. 
 
Article 7.1 
 
Scope And Coverage  
 1. Except as provided in paragraphs 2 and 3 of this Article, this Chapter applies to all standards, 
technical regulations, and conformity assessment pro cedures that may, directly or indirectly, affect 
trade in goods between the Parties. Notwithstanding Article 1.4 (Extent of Obligations), this Chapter 
applies only to central government bodies. WT/REG160/1 
Page 52  
 
2. Technical specifications prepared by governmental bodies for production or consumption 
requirements of such bodies are not subject to the provisions of this Chapter, but are addressed in 
Chapter Nine (Government Procurem ent), according to its coverage. 
3. This Chapter does not apply to sanitary and phyt osanitary measures as defined in Annex A of 
the SPS Agreement. 
Article 7.2 
 
Affirmation Of Agreement On Technical Barriers To Trade
 
  Further to Article 1.3 (Relation to Other Agreem ents), the Parties affirm their existing rights 
and obligations with respect to each other under the TBT Agreement.  
 
Article 7.3 
 
International Standards
 
 
 In determining whether an international standard, guide, or recommendation within the 
meaning of Articles 2, 5, and Annex 3 of the TBT Agreement exists, each Party shall apply the 
principles set out in Decisions and Recommendations adopted by the Committee since 1 January 
1995 , G/TBT/1/Rev.7, 28 November 2000, Section IX ( Decision of the Committee on Principles for 
the Development of International Standards, Gu ides and Recommendations with relation to Articles 
2, 5 and Annex 3 of the Agreement ), issued by the WTO Committee on Technical Barriers to Trade. 
 
Article 7.4 
 
Trade Facilitation  
 
 The Parties shall intensify their joint work in the field of standards, technical regulations, and 
conformity assessment procedures with a view to facilitating access to each other’s markets. In 
particular, the Parties shall seek to identify bilatera l initiatives that are appropriate for particular issues 
or sectors. Such initiatives may include coopera tion on regulatory issues, such as convergence or 
equivalence of technical regulations and standards, alignment with international standards, reliance on 
a supplier’s declaration of conformity, and use of accreditation to qualify conformity assessment 
bodies, as well as cooperation through mutual recognition.  
Article 7.5 
 
Technical Regulations
 
 1. Where a Party provides for the acceptance of a fo reign technical regulation as equivalent to a 
particular technical regulation of its own, and the Party does not accept a technical regulation of the other Party as equivalent to that technical regulation, it shall, at the request of the other Party, explain 
the reasons for not accepting the technical regulation of the other Party as equivalent. 
2. Where a Party does not provide for the accepta nce of foreign technical regulations as 
equivalent to its own, that Party may, at the requ est of the other Party, explain the reasons for not 
accepting the other Party’s techni cal regulations as equivalent. 
 
 
 
  WT/REG160/1 
 Page 53 
 
 
Article 7.6 
 
Conformity Assessment  
 1. The Parties recognize that a broad range of mech anisms exists to fac ilitate the acceptance of 
conformity assessment results, including: 
(a) the importing Party’s reliance on a supp lier’s declaration of conformity; 
(b) voluntary arrangements between conformity assessment bodies from each Party’s 
territory; 
(c) agreements on mutual acceptance of the results of conformity assessment procedures 
with respect to specified regulations conducted by bodies located in the territory of 
the other Party; 
(d) accreditation procedures for qualifying conformity assessment bodies; 
(e) government designation of conformity assessment bodies; and 
(f) recognition by one Party of the results of  conformity assessments performed in the 
other Party’s territory. 
The Parties shall intensify their exchange of informa tion on the range of mechanisms to facilitate the 
acceptance of conformity assessment results.  2. Where a Party does not accept the results of a conformity assessment procedure performed in 
the territory of the other Party, it shall, on request of the other Party, explain its reasons. 
3. Each Party shall accredit, approve, license, or otherwise recognize conformity assessment 
bodies in the territory of the other Party on terms no less favorable than those it accords to conformity 
assessment bodies in its territory. If a Party accredits, approves, licenses, or otherwise recognizes a body assessing conformity with a particular technical regulation or standard in its territory and it 
refuses to accredit, approve, license, or otherw ise recognize a body assessing conformity with that 
technical regulation or standard in the territory of  the other Party, it shall, on request, explain the 
reasons for its refusal. 
4. Where a Party declines a request from the other Part y to engage in or c onclude negotiations to 
reach agreement on facilitating recognition in its te rritory of the results of conformity assessment 
procedures conducted by bodies in the territory of th e other Party, it shall, on request, explain its 
reasons. 
Article 7.7 
 
Transparency
 
 1. Further to Article 20.2 (Publication), each Part y shall allow persons of the other Party to 
participate in the development of standards, technical regulations, and conformity assessment 
procedures. Each Party shall permit persons of the other Party to participate in the development of 
such measures on terms no less favorable than those accorded to its own persons. 
2. Each Party shall recommend that non-governme ntal standardizing bodies in its territory 
observe paragraph 1. WT/REG160/1 
Page 54  
 
3. In order to enhance the opportunity for pers ons to provide meaningful comments, a Party 
publishing a notice under Article 2.9 or 5.6 of the TBT Agreement shall: 
(a) include in the notice a statement descri bing the objective of the proposal and the 
rationale for the approach the Party is proposing; and 
(b) transmit the proposal electronically to the other Party through the inquiry point 
established under Article 10 of the TBT Agre ement at the same time as it notifies 
WTO Members of the proposal pursuant to the TBT Agreement.  
Each Party should allow at least 60 days from the transmission under subparagraph (b) for persons 
and the other Party to make comments in writing on the proposal.  
4. Where a Party makes a notification under Article  2.10 or 5.7 of the TBT Agreement, it shall 
at the same time transmit the notification to the other Party, electronically, through the inquiry point 
referenced in paragraph 3(b). 
5. Each Party shall publish, in print or electronica lly, or otherwise make available to the public, 
its responses to significant comments at the sa me time as the publication of the final technical 
regulation or conformity assessment procedure. 
6. Each Party shall, on request of the other Party,  provide information regarding the objective of, 
and rationale for, a standard, technical regulation,  or conformity assessment procedure that the Party 
has adopted or is proposing to adopt. 
7. Each Party shall implement this Article as soon as is practicable and in no event later than 
five years from the date of entry into force of this Agreement. 
Article 7.8 
 
Committee On Technical Barriers To Trade
 
 1. The Parties hereby establish the Committee on Technical Barriers to Trade, comprising 
representatives of each Party, pursuant to Annex 7.8. 
2. The Committee’s functions shall include: 
(a) monitoring the implementation and administration of this Chapter; 
(b) promptly addressing any issue that a Party raises related to the development, 
adoption, application, or enforcement of  standards, technical regulations, or 
conformity assessment procedures; 
(c) enhancing cooperation in the development a nd improvement of standards, technical 
regulations, and conformity assessment procedures; 
(d) where appropriate, facilitating sectoral  cooperation among governmental and non-
governmental conformity assessment bodies in the Parties’ territories; 
(e) exchanging information on developments  in non-governmental, regional, and 
multilateral fora engaged in activities related to standardization, technical regulations, 
and conformity assessment procedures;  WT/REG160/1 
 Page 55 
 
 
(f) taking any other steps the Parties consider will assist them in implementing the TBT 
Agreement and in facilitating trade in goods between them; 
(g) at a Party’s request, consulting on any matter arising under this Chapter;  
(h) reviewing this Chapter in light of any developments under the TBT Agreement, and 
developing recommendations for amendments  to this Chapter in light of those 
developments; and 
(i) as it considers appropriate, reporting to the Commission on the implementation of this 
Chapter. 
3. Where the Parties have had recourse to consulta tions under paragraph 2(g)  such consultations 
shall, on the agreement of the Parties, constitute  consultations under Artic le 22.4 (Consultations). 
4. A Party shall, on request, give favorable cons ideration to any sector-specific proposal the 
other Party makes for further cooperation under this Chapter. 
5. The Committee shall meet at least once a y ear unless the Parties otherwise agree.  
Article 7.9 
 
Information Exchange  
  Any information or explanation that is provided on request of a Party pursuant to the provisions of this Chapter shall be provided in pr int or electronically within a reasonable period of 
time.  
Article 7.10 
 
Definitions
 
  For purposes of this Chapter, technical regulation, standa rd, conformity assessment 
procedures , and central government body  shall have the meanings assigned to those terms in Annex 
1  of the TBT Agreement.   
ANNEX 7.8 
 
Committee On Technical Barriers To Trade
 
  For purposes of Article 7.8, the Committee shall be coordinated by:  
(a) in the case of Chile, the Ministerio de Economia  through the Departamento de 
Comercio Exterior , or its successor; and 
(b) in the case of the United States, the Office of the United States Trade Representative, 
or its successor. 
 
  
 
 WT/REG160/1 
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CHAPTER EIGHT : TRADE REMEDIES 
 
Section A - Safeguards
 
 
Article 8.1 
 
Imposition Of A Safeguard Measure  
 1. A Party may impose a safeguard measure describ ed in paragraph 2, during the transition 
period only, if as a result of the reduction or elimination of a duty pursuant to this Agreement
1, a good 
originating in the territory of the other Party is being imported into the Party’s territory in such 
increased quantities, in absolute terms or relativ e to domestic production, and under such conditions 
as to constitute a substantial cause of serious inju ry, or threat thereof, to a domestic industry 
producing a like or directly competitive good. 
2. If the conditions in para graph 1 are met, a Party may to the extent as may be necessary to 
prevent or remedy serious injury, or threat thereof, and facilitate adjustment: 
(a) suspend the further reduction of any rate of  duty provided for under this Agreement 
on the good; or 
(b) increase the rate of duty on the good to a level not to exceed the lesser of 
(i) the most-favored-nation (MFN) applied rate of duty in effect at the time the 
action is taken, or 
(ii) the MFN applied rate of duty in effect on the day immediately preceding the 
date of entry into force of this Agreement.2 
Article 8.2 
 
Standards For A Safeguard Measure  
 
1. A Party may apply a safeguard measure, including any extension thereof, for no longer than 
three years. Regardless of its duration, such measure shall terminate at the end of the transition period. 
2. In order to facilitate adjustment in a situa tion where the expected duration of a safeguard 
measure is over one year, the Party applying the m easure shall progressively liberalize it at regular 
intervals during the period of application. 
3. Neither Party may impose a safeguard measure more than once on the same good. 
4. Neither Party may impose a safeguard measure on a good that is subject to a measure that the 
Party has imposed pursuant to Article XIX of GA TT 1994 and the Safeguards Agreement, and neither 
Party may continue maintaining a safeguard measu re on a good that becomes subject to a measure 
that the Party imposes pursuant to Article XI X of GATT 1994 and the Safeguards Agreement. 
5. On the termination of a safeguard measure, the rate of duty shall be no higher than the rate 
that, according to the Party’s Schedule to Annex 3.3 (Tariff Elimination), would have been in effect 
                                                      
1 The Parties note that many of Chile’s produ cts received duty-free tr eatment under the U.S. 
Generalized System of Preferences prior to the entry into force of this Agreement. 
2 The Parties understand that neither tariff rate quotas nor quantitative restrictions would be a 
permissible form of safeguard measure.  WT/REG160/1 
 Page 57 
 
 
one year after the imposition of the measure. Be ginning on January 1 of the year following the 
termination of the action, the Party that has applied the measure shall: 
(a) apply the rate of duty set out in the Party’s Schedule to Annex 3.3 (Tariff 
Elimination) as if the safeguard measu re had never been applied; or  
(b) eliminate the tariff in equal annual stages e nding on the date set out in the Party’s 
Schedule to Annex 3.3 (Tariff Eliminati on) for the elimination of the tariff. 
Article 8.3 
 
Investigation Procedures And Transparency Requirements  
 
1. A Party shall impose a safeguard measure only following an investigation by the Party’s 
competent authorities in accordance with Articles 3 and 4.2(c) of the Safeguards Agreement; and to 
this end, Articles 3 and 4.2(c) of the Safeguards Ag reement are incorporated into and made a part of 
this Agreement, mutatis mutandis . 
2. In the investigation described in paragraph 1, a Party shall comply with the requirements of 
Article 4.2(a) of the Safeguards Agreement; and to  this end, Article 4.2(a) of the Safeguards 
Agreement is incorporated into and made a part of this Agreement, mutatis mutandis . 
Article 8.4 
 
Notification  
 
1. A Party shall promptly notify the other Party, in writing, on: 
(a) initiating an investigation under Article 8.3; 
(b) making a finding of serious injury or threat thereof caused by increased imports under 
Article 8.1; 
(c) taking a decision to impose or ex tend a safeguard measure; and 
(d) taking a decision to modify a safeguard measure previously undertaken. 
2. A Party shall provide to the other Party a copy  of the public version of the report of its 
competent authorities required under Article 8.3(1). 
Article 8.5 
 
Compensation  
 
1. The Party taking a safeguard measure shall, in consultation with the other Party, provide to 
the other Party mutually agreed trade liberalizi ng compensation in the form of concessions having 
substantially equivalent trade effe cts or equivalent to the value of  the additional duties expected to 
result from the measure. Such consultations shall begin within 30 days of the imposition of the 
measure. 
2. If the Parties are unable to reach agreement on compensation within 30 days after the 
consultations commence, the exporting Party shall be free to suspend the application of substantially 
equivalent concessions to the trade of th e Party applying the safeguard measure. WT/REG160/1 
Page 58  
 
3. A Party shall notify the other Party in writing at least 30 days before suspending concessions 
under paragraph 2. 
4. The obligation to provide compensation unde r paragraph 1 and the right to suspend 
substantially equivalent concessi ons under paragraph 2 shall term inate on the later of: (a) the 
termination of the safeguard measure; or (b) the date  on which the rate of duty returns to the rate of 
duty set out in the Party’s Schedule to Annex 3.3 (Tariff Elimination). 
Article 8.6 
 
Global Actions
 
 
1. Each Party retains its rights and obliga tions under Article XIX of GATT 1994 and the 
Safeguards Agreement. 
2. This Agreement does not confer any additional ri ghts or obligations on the Parties with regard 
to actions taken pursuant to Article XIX of GATT 1994 and the Safeguards Agreement. 
Article 8.7 
 
Definitions  
  For purposes of this Section:   domestic industry  means, with respect to an imported good, the producers as a whole of the 
like or directly competitive good or those producers w hose collective production of the like or directly 
competitive good constitutes a major proportion of the total domestic production of such good; 
  safeguard measure  means a safeguard measure d escribed in Article 8.1(2);  
 
 serious injury  means a significant overall impairment in  the position of a domestic industry;  
  substantial cause  means a cause which is important and not less than any other cause; 
  threat of serious injury  means serious injury that, on the basis of facts and not merely on 
allegation, conjecture, or remote possibility, is clearly imminent; and 
 
 transition period  means the 10-year period beginning on the date of entry into force of this 
Agreement, except that transition period  shall mean the 12-year period beginning on the date of 
entry into force of this Agreem ent in any case in which a safeguard measure is applied against an 
agricultural good and the Schedule to Annex 3.3 (T ariff Elimination) of the Party applying the 
measure provides for the Party to eliminate its tariffs on the good over 12 years. 
  
Section B - Antidumping And Countervailing Duties
 
 
Article 8.8 
 
Antidumping And Countervailing Duties  
 1. Each Party retains its rights and obligations under the WTO Agreement with regard to the 
application of antidumping and countervailing duties.  WT/REG160/1 
 Page 59 
 
 
2. No provisions of this Agreement, including th e provisions of Chapter Twenty-Two (Dispute 
Settlement), shall be construed as imposing any rights  or obligations on the Parties with respect to 
antidumping or countervailing duty measures. 
 
CHAPTER NINE : GOVERNMENT PROCUREMENT 
 
Objectives  
  The objectives of this Chapter are to r ecognize the importance of conducting government 
procurement in accordance with the fundamental  principles of openness, transparency, and due 
process; and to strive to provide comprehensive coverage of procurement markets by eliminating 
market access barriers to the supply of g oods and services, including construction services. 
 
Article 9.1 
 
Scope And Coverage
 
 1. This Chapter applies to any measure adopted or maintained by a Party relating to procurement 
by an entity listed in Annex 9.1: 
(a) by any contractual means, including purchase a nd rental or lease, with or without an 
option to buy, build-operate-transfer c ontracts, and public works concession 
contracts; and 
(b) subject to the conditions specified in Annex 9.1. 
2. This Chapter does not apply to: 
(a) non-contractual agreements or any form of assistance provided by a Party or a state 
enterprise, including grants, loans, equity  infusions, fiscal incentives, subsidies, 
guarantees, cooperative agreements, governme nt provision of goods and services to 
persons or to a regional or local level of government, and purchases for the direct 
purpose of providing foreign assistance; 
(b) purchases funded by international grants, loans, or other assistance, where the 
provision of such assistance is subject to c onditions inconsistent with the provisions 
of this Chapter; 
(c) hiring of government employees and related employment measures; and 
(d) acquisition of fiscal agency or deposit ory services, liquidation and management 
services for regulated financial institutions, and sale and distribution services for government debt. 
3. Each Party shall ensure that its procuring entities listed in Annex 9.1 comply with this 
Chapter in conducting procurement covered by this Chapter. 
4. Where an entity awards a contract that is not c overed by this Chapter, nothing in this Chapter 
shall be construed to cover any good or service component of that contract. 
5. No entity may prepare, design, or otherwise structure or divide, in any stage of the 
procurement, any procurement in order to avoid the obligations of this Chapter. WT/REG160/1 
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6. Nothing in this Chapter shall prevent either Party from developing new procurement policies, 
procedures, or contractual means, provided they  are not inconsistent with this Chapter. 
Article 9.2 
 
General Principles
 
 
National Treatment And Non-Discrimination 
 
1. With respect to any measure governing procuremen t covered by this Chapter, each Party shall 
accord to the goods and services of the other Party, and to the suppliers of the other Party of such 
goods and services, treatment no less favorable than the most favourable treatment the Party accords 
to its own goods, services, and suppliers.  
2. With respect to any measure governing procurem ent covered by this Chapter, neither Party 
may: 
(a) treat a locally established supplier less fa vorably than another locally established 
supplier on the basis of degree of fo reign affiliation or ownership; or 
(b) discriminate against a locally established supplier on the basis that the goods or 
services offered by that supplier for a particular procurement are goods or services of the other Party. 
Determination Of Origin 
 3. For purposes of paragraphs 1 and 2, determinati on of the origin of goods shall be made on a 
non-preferential basis. 
Offsets 
 
4. An entity shall not consider, seek, or impose offsets at any stage of a procurement. 
Measures Not Specific To Procurement 
 
5. Paragraphs 1 and 2 do not apply to measures respecting customs duties or other charges of 
any kind imposed on or in connection with importation, the method of levying such duties and charges or other import regulations, including restri ctions and formalities, or measures affecting trade 
in services other than measures specifically gove rning procurement covered by this Chapter. 
Article 9.3 
 
Publication Of Procurement Measures
 
  Each Party shall promptly publish: 
 
(a) its measures of general application specifi cally governing procurement covered by 
this Chapter; and 
(b) any changes in such measu res in the same manner as the original publication. 
 
 
  WT/REG160/1 
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Article 9.4 
 
Publication Of Notice Of Intended Procurement  
 1. For each procurement covered by this Chapter,  an entity shall publish in advance a notice 
inviting interested suppliers to submit tenders  for that procurement (“notice of intended 
procurement”), except as provided in Article 9.9(2) . Each such notice shall be accessible during the 
entire period established for tendering for the relevant procurement. 
2. Each notice of intended procurement shall incl ude a description of the intended procurement, 
any conditions that suppliers must fulfill to partic ipate in the procurement, the name of the entity 
issuing the notice, the address wher e suppliers may obtain all docume nts relating to the procurement, 
the time limits for submission of tenders, and the dates for delivery of the goods or services to be 
procured. 
Article 9.5 
 
Time Limits For The Tendering Process
 
 1. An entity shall prescribe time limits for the tendering process that allow sufficient time for 
suppliers to prepare and submit responsive tenders, taking into account the nature and complexity of 
the procurement. An entity shall provide no less th an 30 days between the date on which it publishes 
the notice of intended procurement and the deadline for submitting tenders. 
2. Notwithstanding paragraph 1, where there ar e no qualification requirements for suppliers, 
entities may establish a time limit of less than 30 days, but in no case less than 10 days, in the 
following circumstances: 
(a) where the entity has published a notice contai ning the information specified in Article 
9.4(2) at least 30 days and not more than 12 months in advance;  
(b) in the case of the second or subsequent pub lications of notices for procurement of a 
recurring nature; 
(c) where an entity procures commercial goods or services that are sold or offered for 
sale to, and customarily purchased and used by, nongovernmental buyers for non-governmental purposes; or 
(d) where an unforeseen state of urgency duly  substantiated by the entity renders 
impracticable the time limits specified in paragraph 1. 
 
Article 9.6 
 
Information On Intended Procurements
 
 
1. An entity shall provide interested suppliers  tender documentation that includes all the 
information necessary to permit suppliers to prepare and submit responsive tenders. The 
documentation shall include all criteria that the entit y will consider in awarding the contract, including 
all cost factors, and the weights or, where appropria te, the relative values, that the entity will assign to 
these criteria in evaluating tenders. WT/REG160/1 
Page 62  
 
2. Where an entity does not publish all the tende r documentation by electronic means, the entity 
shall, on request of any supplier, promptly make the documentation available in written form to the 
supplier. 
3. Where an entity, during the course of a procur ement, modifies the criteria referred to in 
paragraph 1, it shall transmit all such modifications in writing: 
(a) to all suppliers that are participating in the procurement at the time the criteria are 
modified, if the identities of such suppliers  are known, and in all other cases, in the 
same manner as the original information was transmitted; and 
(b) in adequate time to allow such suppliers to modify and re-submit their tenders, as 
appropriate. 
Article 9.7 
 
Technical Specifications
 
 1. An entity shall not prepare, adopt, or apply any technical specification w ith the purpose or the 
effect of creating unnecessary obstacles to trade between the Parties. 
2. Any technical specification prescribed by an entity shall be, where appropriate: 
(a) specified in terms of performance requirem ents rather than design or descriptive 
characteristics;  and 
(b) based on international standards, where a pplicable, otherwise on national technical 
regulations, recognized national st andards, or building codes. 
3. An entity shall not prescribe technical specifica tions that require or refer to a particular 
trademark or trade name, patent, design or type, speci fic origin or producer or supplier unless there is 
no sufficiently precise or intelligible way of othe rwise describing the procurement requirements and 
provided that, in such cases, words such as “or equivalent” are included in the tender documentation. 
4. An entity shall not seek or accept, in a manne r that would have the effect of precluding 
competition, advice that may be used in the prepar ation or adoption of any technical specification for 
a specific procurement from a person that may have a commercial interest in that procurement. 
5. For greater certainty, this Article is not intende d to preclude a Party from preparing, adopting, 
or applying technical specifications to prom ote the conservation of natural resources. 
Article 9.8 
 
Conditions For Participation
 
 1. Where an entity requires suppliers to satisfy registration, qualification, or any other 
requirements or conditions for partic ipation (“conditions for participati on”) in order to participate in a 
procurement, the entity shall publish a notice inviting  suppliers to apply for participation. The entity 
shall publish the notice sufficiently in advance to provide interested suppliers sufficient time to 
prepare and submit applications and for the entity to  evaluate and make its determinations based on 
such applications. 
2. Each entity shall:  WT/REG160/1 
 Page 63 
 
 
(a) limit any conditions for participation in a pr ocurement to those that are essential to 
ensure that the potential supplier has the le gal, technical, and financial capacity to 
fulfill the requirements and technical specifications of the procurement; 
(b) base qualification decisions solely on the conditions for participation that it has 
specified in advance in notices or tender documentation; and 
(c) recognize as qualified all suppliers of th e other Party that meet the requisite 
conditions for participation in a proc urement covered by this Chapter. 
3. Entities may establish publicly available lists of suppliers qualified to participate in 
procurements. Where an entity requires suppliers to qua lify for such a list in order to participate in a 
procurement, and a supplier that has not yet qualified applies to be included on the list, the entity shall 
promptly start the qualification procedures for the s upplier and shall allow the supplier to participate 
in the procurement, provided there is sufficient time  to complete the procedures within the time period 
established for tendering. 
4. No entity may impose the condition that, in order for a supplier to participate in a 
procurement, the supplier has previously been awar ded one or more contracts by an entity of that 
Party or that the supplier has prior work experience in  the territory of that Party. An entity shall judge 
a supplier’s financial and technical capacities on th e basis of its global business activities including 
both its activity in the territory of the Party of the su pplier, and its activity, if any, in the territory of 
the Party of the entity. 
5. An entity shall promptly communicate to any su pplier that has applied for qualification its 
decision on whether that supplier is qualified. Wher e an entity rejects an application for qualification 
or ceases to recognize a supplier as qualified, that en tity shall, on request of the supplier, promptly 
provide it a written explanation of the reasons for its decision. 
6. Nothing in this Article shall preclude an en tity from excluding a supplier from a procurement 
on grounds such as bankruptcy or false declarations.  
Article 9.9 
 
Tendering Procedures  
 1. Entities shall award contracts by means of open tendering procedures, in the course of which 
any interested supplier may submit a tender.  
2. Provided that the tendering procedure is not u sed to avoid competition or to protect domestic 
suppliers, entities may award contracts by mean s other than open tendering procedures in the 
following circumstances, where applicable: 
(a) in the absence of tenders that conform to the essential requirements in the tender 
documentation provided in a prior invitation to tender, including any conditions for participation, on condition that the require ments of the initial procurement are not 
substantially modified in the contract as awarded; 
(b) where, for works of art, or for reasons connected with the protection of exclusive 
rights, such as patents or copyrights, or proprietary information, or where there is an absence of competition for technical reasons , the goods or services can be supplied 
only by a particular supplier and no reas onable alternative or substitute exists; WT/REG160/1 
Page 64  
 
(c) for additional deliveries by the original  supplier that are intended either as 
replacement parts, extensions, or con tinuing services for existing equipment, 
software, services or installations, where a change of supplier would compel the 
entity to procure goods or services not me eting requirements of interchangeability 
with existing equipment, software, services, or installations; 
(d) for goods purchased on a commodity market; 
(e) where an entity procures a prototype or a first good or service that is developed at its 
request in the course of, and for, a particular contract for research, experiment, study, or original development. When such c ontracts have been fulfilled, subsequent 
procurements of such goods or services sh all be subject to Articles 9.2 through 9.8 
and Article 9.17; 
(f) where additional construction services that were not included in the initial contract 
but that were within the objectives of th e original tender documentation have, due to 
unforeseeable circumstances, become necessary to complete the construction services described therein. However, the total va lue of contracts awarded for additional 
construction services may not exceed 50 percent of the amount of the initial contract; 
or 
(g) in so far as is strictly necessary where, fo r reasons of extreme urgency brought about 
by events unforeseeable by the entity, the goods  or services could not be obtained in 
time by means of an open tendering proce dure and the use of an open tendering 
procedure would result in serious injury to the entity, or the entity’s program 
responsibilities, or the Party. For purposes of  this subparagraph, lack of advance 
planning by an entity or its concerns rela ting to the amount of funds available to it 
within a particular period do not constitute unforeseeable events. 
3. An entity shall maintain a record or prepar e a written report providing specific justification 
for any contract awarded by means other than open tendering procedures, as provided in paragraph 2. 
Article 9.10 
 
Awarding Of Contracts
 
 1. An entity shall require that in order to be cons idered for award, a tender must be submitted in 
writing and must, at the time it is submitted: 
(a) conform to the essential requirements of the tender documentation; and 
(b) be submitted by a supplier that has satisfied  the conditions for participation that the 
entity has provided to all participating suppliers. 
2. Unless an entity determines that it is not in the public interest to award a contract, it shall 
award the contract to the supplier that the entity h as determined to be fully capable of undertaking the 
contract and whose tender is  determined to be the most advantag eous in terms of the requirements and 
evaluation criteria set out in the tender documentation.  
3. No entity may cancel a procurement, or terminate or modify awarded contracts, in order to 
avoid the obligations of this Chapter. 
 
  WT/REG160/1 
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Article 9.11 
 
Information On Awards  
 
Information Provided To Suppliers 
 
1. Subject to Article 9.15, an entity shall promptly  inform suppliers participating in a tendering 
procedure of its contract award decision. On requ est, an entity shall provide a supplier whose tender 
was not selected for award the reasons for not selec ting its tender and the relative advantages of the 
tender the entity selected. 
Publication Of Award Information 
 
2. After awarding a contract covered by this Chap ter, an entity shall promptly publish a notice 
that includes at least the following information about the award: 
(a) the name of the entity; 
(b) a description of the goods or services procured; 
(c) the name of the winning supplier; 
(d) the value of the contract award; and 
(e) where the entity has not used open tendering procedures, an indication of the 
circumstances justifying  the procedures used. 
Maintenance Of Records 
 
3. An entity shall maintain records and reports relating to tendering procedures and contract 
awards covered by this Chapter, including the record s and reports provided for in Article 9.9(3), for a 
period of at least three years. 
Article 9.12 
 
Ensuring Integrity In Procurement Practices  
  Each Party shall adopt the necessary legislativ e or other measures to establish that it is a 
criminal offense under its law for:  
(a) a procurement official of that Party to solicit or accept, directly or indirectly, any 
article of monetary value or other benefit, for that procurement official or for another 
person, in exchange for any act or omissi on in the performance of that procurement 
official’s procurement functions; 
(b) any person to offer or grant, directly or i ndirectly, to a procurement official of that 
Party, any article of monetary value or othe r benefit, for that procurement official or 
for another person, in exchange for any act or omission in the performance of that procurement official’s procurement functions; and  
(c) any person intentionally to offer, promis e or give any undue pecuniary or other 
advantage, whether directly or through intermediaries, to a foreign procurement 
official, for that foreign procurement official  or for a third party, in order that the 
foreign procurement official act or refrain  from acting in relation to the performance WT/REG160/1 
Page 66  
 
of procurement duties, in order to obta in or retain business or other improper 
advantage. 
Article 9.13 
 
Domestic Review Of Supplier Challenges
 
 
Independent Review Authorities 
 
1. Each Party shall establish or designate at least one impartial administrative or judicial 
authority that is independent from its entities to r eceive and review challenges that suppliers submit 
relating to the Party’s measures implementing this Chapter in connection with  a procurement covered 
by this Chapter and make appropr iate findings and recommendations. Where a challenge by a supplier 
is initially reviewed by a body other than such an im partial authority, the Party shall ensure that the 
supplier may appeal the initial decision to an impar tial administrative or judicial authority that is 
independent of the entity that is the subject of the challenge. 
2. Each Party shall provide that an authority it establishes or designates under paragraph 1 has 
authority to take prompt interim measures pending  the resolution of a challenge to preserve the 
supplier’s opportunity to participate in the procurem ent and to ensure that the Party complies with its 
measures implementing this Chapter, including by su spending the contract award or the performance 
of a contract that has already been awarded. 
3. Each Party shall ensure that its review pro cedures are published and are timely, transparent, 
effective, and consistent w ith due process principles.  
4. Each Party shall ensure that all documents rela ted to a challenge to a procurement covered by 
this Chapter are made available to any authority it establishes or designates under paragraph 1. 
5. Notwithstanding other review procedures provided for or developed by each of the Parties, 
each Party shall ensure that any authority it estab lishes or designates under paragraph 1 provides at 
least the following: 
(a) an opportunity for the supplier to review relevant documents and to be heard by the 
authority in a timely manner; 
(b) sufficient time for the supplier to prepare and submit written challenges, which in no 
case shall be less than 10 days from the time when the basis of the complaint became 
known or reasonably should have become known to the supplier; 
(c) a requirement that the entity respond in writing to the supplier’s challenge; 
(d) an opportunity for the supplier to reply to the entity’s response to the challenge; and 
(e) prompt delivery in writing of the decisi ons relating to the challenge, with an 
explanation of the grounds for each decision. 
6. Each Party shall ensure that a supplier’s s ubmission of a challenge will not prejudice the 
supplier’s participation in ongoi ng or future procurements. 
 
    WT/REG160/1 
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Article 9.14 
 
Modifications And Rectifications  
 1. Either Party may modify its coverage  under this Chapter provided that it: 
(a) notifies the other Party in writing and the other Party does not object in writing within 
30 days of the notification; and 
(b) offers within 30 days acceptable compensat ory adjustments to the other Party to 
maintain a level of coverage comparable to  that existing prior to the modification, 
except as provided in paragraphs 2 and 3. 
2. Either Party may make rectifications of a pur ely formal nature to its coverage under this 
Chapter, or minor amendments to its Schedules to Annex 9.1, Sections (A) through (C), provided that 
it notifies the other Party in writing and the other Party does not object in writing within 30 days of the notification. A Party that makes such a rectifi cation or minor amendment shall not be required to 
provide compensatory adjustments.  
3. A Party need not provide compensatory adjustme nts in those circumstances where the Parties 
agree that the proposed modification covers an entity  over which a Party has effectively eliminated its 
control or influence. Where the Parties do not agr ee that such government control or influence has 
been effectively eliminated, the objecting Party may request further information or consultations with 
a view to clarifying the nature of any government  control or influence and reaching agreement on the 
entity’s continued coverage under this Chapter. 
4. Where the Parties are in agreement on the prop osed modification, rectification, or minor 
amendment, including where a Party has not objected within 30 days under paragraph 1 or 2, the Commission shall give effect to the agreement by modifying forthwith the relevant Section of    
Annex 9.1. 
Article 9.15 
 
Non-Disclosure Of Information
 
 1. The Parties, their entities, and their review  authorities shall not disclose confidential 
information the disclosure of which would prejudice legitimate commercial interests of a particular 
person or might prejudice fair competition between suppliers, without the formal authorization of the 
person that provided the information to the Party. 
2. Nothing in this Chapter shall be construed as requiring a Party or its entities to disclose 
confidential information the disclosure of which would impede law enforcement or otherwise be 
contrary to the public interest. 
Article 9.16 
 
Exceptions
 
  Provided that such measures are not applied in a manner that would constitute a means of 
arbitrary or unjustifiable discrimination between Parties where the same conditions prevail or a 
disguised restriction on trade between the Parties, nothing in this Chapter shall be construed to 
prevent a Party from adopting or maintaining measures: 
 
(a) necessary to protect public morals, order, or safety; WT/REG160/1 
Page 68  
 
(b) necessary to protect human, animal, or plant life or health; 
(c) necessary to protect intellectual property; or 
(d) relating to goods or services of handicapped persons, of philanthropic institutions, or 
of prison labor. 
The Parties understand that subpara graph (b) includes environmenta l measures necessary to protect 
human, animal, or plant life or health. 
 
Article 9.17 
 
Public Information
 
 
1. In order to facilitate access to information on commercial opportunities under this Chapter, 
each Party shall ensure that electronic databases th at provide current information on all procurements 
covered by this Chapter that ar e conducted by entities listed in Anne x 9.1(A), including information 
that can be disaggregated by detailed categorie s of goods and services, are made available to 
interested suppliers of the other Party, throu gh the Internet or a comparable computer-based 
telecommunications network. Each Party shall, on re quest of the other Party, provide information on: 
(a) the classification system used to disaggregate information on procurement of 
different goods and services in such databases; and 
(b) the procedures for obtaining access to such databases. 
2. Entities listed in Annex 9.1(A) shall publis h notices of intended procurement in a 
government-wide, single point of entry electronic publication that is accessible through the Internet or 
a comparable computer-based telecommunications network. For entities listed in Annex 9.1(B), each 
Party shall facilitate a reasonable me ans for suppliers of the other Pa rty to easily identify procurement 
opportunities, which should include a single point of entry. 
3. Each Party shall encourage its entities to pub lish, as early as possible in the fiscal year, 
information regarding the entity’s procurement plans. 
Article 9.18 
 
Committee On Procurement  
  The Parties hereby establish a Committee on Procurement comprising representatives of each 
Party. On request, the Committee shall meet to addr ess matters related to the implementation of this 
Chapter, such as:  
(a) bilateral cooperation relating to the development and use of electronic 
communications in government procuremen t systems, including developments that 
may lead to reducing the time limits for tendering set out in Article 9.5; 
(b) exchange of statistics and other informati on to assist the Parties in monitoring the 
implementation and operati on of this Chapter; 
(c) consideration of further negotiations aime d at broadening the coverage of this 
Chapter, including with respect to sub-fede ral or sub-central entities and state-owned 
enterprises; and  WT/REG160/1 
 Page 69 
 
 
(d) efforts to increase understanding of th eir respective government procurement 
systems, with a view to maximizing ac cess to government procurement opportunities 
for small business suppliers. To that end, either Party may request the other to provide trade-related technical assistance, including training of government personnel 
or interested suppliers on specific elements  of each Party’s government procurement 
system. 
Article 9.19 
 
Further Negotiations
 
 
 On request of either Party, the Parties shall enter into negotiations w ith a view to extending 
coverage under this Chapter on a reciprocal basis,  if a Party provides, through an international 
agreement entered into after entry into force of th is Agreement, access to its procurement market for 
suppliers of a non-Party beyond what it provides under this Agreement to suppliers of the other Party. 
 
Article 9.20 
 
Definitions  
  For purposes of this Chapter:  
 build-operate-transfer contract  and public works concession contract  mean any 
contractual arrangement, the primary purpose of which is to provide for the construction or 
rehabilitation of physical infrastructure, plant, bu ildings, facilities, or other government owned works 
and under which, as consideration for a supplier’s execution of a contractual arrangement, the entity 
grants to the supplier, for a specified period of time, temporary ownership or a right to control and 
operate, and demand payment for the use of, su ch works for the duration of the contract; 
  entity  means an entity listed in Annex 9.1; 
  in writing  or written  means any expression of information in words, numbers, or other 
symbols, including electronic expressions, that can be read, reproduced, and stored;  
 
 international standard  means a standard that has been developed in conformity with the 
document referenced in Article 7.3 (International Standards); 
  offsets  means conditions imposed or considered by an entity prior to, or in the course of, its 
procurement process that encourage local developm ent or improve a Party’s balance of payments 
accounts by means of requirements of local conten t, licensing of technology, investment, counter-
trade, or similar requirements;   procurement official  means a person who performs procurement functions;  
 
 publish  means to disseminate information in an electronic or paper medium that is distributed 
widely and is readily accessible to the general public;   supplier  means a person that provides or could provide goods or services to an entity; and  
 
 technical specification  means a specification that lays down the characteristics of goods to be 
procured or their related processes and production met hods, or the characteristics of services to be 
procured or their  related operating methods, includ ing the applicable administrative provisions, and a 
requirement relating to conformity assessment procedures that an entity prescribes. A technical WT/REG160/1 
Page 70  
 
specification may also include or deal exclusively with terminology, symbols, packaging, marking or 
labeling requirements, as they apply to a good, process, service or production or operating method. 
 
 
ANNEX 9.1 
 
Section A - Central Level Of Government Entities
 
 
 This Agreement applies to procurement by the Central Level of Government Entities  listed 
in  this Section where the value of the procuremen t is estimated, in accordance with Section G, to 
equal or exceed the following relevant threshold. Un less otherwise specified within this Section, all 
agencies subordinate to those listed are covered by this Agreement.  
Thresholds: 
  For procurement of goods and services 
  (To be adjusted according to the formula in Section G, paragraph 2):  $56,190   For procurement of construction services  
 (To be adjusted according to the formula in Section G, paragraph 3):  $6,481,000 
 
Schedule Of Chile 
 
1. Presidencia de la República 
2. Ministerio de Interior 
3. Ministerio de Relaciones Exteriores 4. Ministerio de Defensa Nacional 5. Ministerio de Hacienda 6. Ministerio Secretaría General de la Presidencia 7. Ministerio Secretaría General de Gobierno 
8. Ministerio de Economía, Fomento, Reconstrucción y Energía 
9. Ministerio de Minería 10. Ministerio de Planificación y Cooperación 11. Ministerio de Educación 12. Ministerio de Justicia 
13. Ministerio de Trabajo y Previsión Social 
14. Ministerio de Obras Públicas 15. Ministerio de Transporte y Telecomunicaciones 16. Ministerio de Salud 17. Ministerio de la Vivienda y Urbanismo 18. Ministerio de Bienes Nacionales 
19. Ministerio de Agricultura 
20. Ministerio Servicio Nacional de la Mujer  Gobiernos Regionales  
Intendencia I Región 
Gobernación de Arica Gobernación de Parinacota Gobernación de Iquique  
Intendencia II Región  WT/REG160/1 
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Gobernación de Antofagasta 
Gobernación de El Loa Gobernación de Tocopilla  Intendencia III Región 
Gobernación de Chañaral 
Gobernación de Copiapó  Intendencia IV Región Gobernación de Huasco 
Gobernación de El Elqui 
Gobernación de Limarí Gobernación de Choapa  Intendencia V Región 
Gobernación de Petorca 
Gobernación de Valparaíso Gobernación de San Felipe de Aconcagua 
Gobernación de Los Andes Gobernación de Quillota Gobernación de San Antonio 
Gobernación de Isla de Pascua 
 Intendencia VI Región Gobernación de Cachapoal Gobernación de Colchagua 
Gobernación de Cardenal Caro 
 Intendencia VII Región Gobernación de Curicó Gobernación de Talca Gobernación de Linares 
Gobernación de Cauquenes 
 Intendencia VIII Región Gobernación de Ñuble Gobernación de Bío-Bío 
Gobernación de Concepción 
Gobernación de Arauco  Intendencia IX Región Gobernación de Malleco Gobernación de Cautín 
 
Intendencia X Región Gobernación de Valdivia Gobernación de Osorno Gobernación de Llanquihue 
Gobernación de Chiloé 
Gobernación de Palena  Intendencia XI Región Gobernación de Coihaique 
Gobernación de Aysén WT/REG160/1 
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Gobernación de General Carrera 
 Intendencia XII Región Gobernación de Capitán Prat Gobernación de Ultima Esperanza 
Gobernación de Magallanes 
Gobernación de Tierra del Fuego Gobernación de Antártica Chilena  Intendencia Región Metropolitana 
Gobernación de Chacabuco 
Gobernación de Cordillera Gobernación de Maipo Gobernación de Talagante Gobernación de Melipilla 
Gobernación de Santiago  
Schedule Of The United States 
 
1. Advisory Commission on Intergovernmental Relations 2.  African Development Foundation 
3.  Alaska Natural Gas Transportation System 
4.  American Battle Monuments Commission 5.  Appalachian Regional Commission 6.  Broadcasting Board of Governors 7.  Commission of Fine Arts 
8.  Commission on Civil Rights 
9.  Commodity Futures Trading Commission 10.  Consumer Product Safety Commission 11.  Corporation for National and Community Service 12.  Delaware River Basin Commission 13.  Department of Agriculture (Not including  procurement of agricultural goods made in 
furtherance of agricultural support programs or human feeding programs) 
14.  Department of Commerce (Not in cluding shipbuilding activities of NOAA) 
15.  Department of Defense (Not includi ng the procurement of the following goods: 
 
(a) Federal Supply Classification (FSC) 83 - all elements of this classification other than 
pins, needles, sewing kits, flag staffs, flagpoles, and flagstaff trucks; 
(b) FSC 84 - all elements other than sub-class 8460 (luggage);  
(c) FSC 89 - all elements other than sub-class 8975 (tobacco products); 
(d) FSC 2310 - (buses only); 
(e) Specialty metals, defined as steels melted in steel manufacturing facilities located in 
the United States or its possessions, where th e maximum alloy content exceeds one or 
more of the following limits, must be  used in products purchased by DOD: (1) 
manganese, 1.65 per cent; silicon, 0.60 per cent; or copper, 0.06 per cent; or which 
contains more than 0.25 per cent of any of the following elements: aluminium, chromium, cobalt, columbium, molybdenum, nickel, titanium, tungsten, or vanadium; (2) metal alloys consisting of nickel, iron- nickel and cobalt base alloys containing a 
total of other alloying metals (except iron) in excess of 10 per cent; (3) titanium and 
titanium alloys; or (4) zirconium base alloys;  WT/REG160/1 
 Page 73 
 
 
(f) FSC 19 and 20 - that part of these classifi cations defined as naval vessels or major 
components of the hull or superstructure thereof; 
(g) FSC 5l and 52; 
(h) The following FSC categories are not generally  covered due to application of Article 
17: 10, 12, 13, 14, 15, 16, 17, 19, 20, 28, 31, 58, 59, 95. For detailed listing of the 
Federal Supply Classifications (FSC), see www.scrantonrtg.com/secrc/fsccodes/fsc.htlm. 
16.  Department of Education 
17.  Department of Energy (Not including nati onal security procurements made in support of 
safeguarding nuclear materials or technology and entered into under the authority of the 
Atomic Energy Act, and oil purchases related to the Strategic Petroleum Reserve) 
18.  Department of Health and Human Services 19.  Department of Hous ing and Urban Development 
20.  Department of the Interior, including the Bureau of Reclamation 21.  Department of Justice 
22.  Department of Labor 
23.  Department of State 24.  Department of Transportation (Not in cluding the Federal Aviation Administration) 
25.  Department of the Treasury 26.  Department of Veterans Affairs 27.  Environmental Protection Agency 
28.  Equal Employment Opportunity Commission 
29.  Executive Office of the President 30.  Export-Import Bank of the United States 31.  Farm Credit Administration 32.  Federal Communications Commission 
33.  Federal Crop Insurance Corporation 
34.  Federal Deposit Insurance Corporation 35.  Federal Election Commission 36.  Federal Emergenc y Management Agency 
37.  Federal Home Loan Mortgage Corporation 38.  Federal Housing Finance Board 
39.  Federal Maritime Commission 
40.  Federal Mediation and Conciliation Service 
41.  Federal Mine Safety and Health Review Commission 42.  Federal Prison Industries, Inc. 43.  Federal Reserve System 
44.  Federal Retirement Thrift Investment Board 
45.  Federal Trade Commission 46.  General Services Administration (Not in cluding Federal Supply Groups 51 and 52 and 
Federal Supply Class 7340). For detailed listing of the Federal Supply Classifications (FSC), 
see www.scrantonrtg.com/secrc/fsc-codes/fsc.htlm. 
47.  Government National Mortgage Association 48.  Holocaust Memorial Council 
49.  Inter-American Foundation 50.  Merit Systems Protection Board 51.  National Aeronautics and Space Administration (NASA) 52.  National Archives and Records Administration 
53.  National Capital Planning Commission 
54.  National Commission on Libraries and Information Science 55.  National Council on Disability WT/REG160/1 
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56.  National Credit Union Administration 57.  National Foundation on the Arts and the Humanities 58.  National Labor Relations Board 59.  National Mediation Board 60.  Nuclear Regulatory Commission 
61.  National Science Foundation 
62.  National Transportation Safety Board 63.  Occupational Safety a nd Health Review Commission 
64.  Office of Government Ethics 65.  Office of the Nuclear Waste Negotiator 
66.  Office of Personnel Management 
67.  Office of Special Counsel 68.  Office of Thrift Supervision 69.  Overseas Private Investment Corporation 70.  Peace Corps 
71.  Pennsylvania Avenue Development Corporation 
72.  Railroad Retirement Board 73.  Securities and Exchange Commission 74.  Selective Service System 75.  Small Business Administration 76.  Smithsonian Institution 
77.  Susquehanna River Basin Commission 
78.  United States Agency for International Development 79.  United States International Trade Commission   
Section B - Sub-Central Level Government Entities
 
 
 This Agreement applies to procurement by the Sub-Central Level Government Entities  
listed in this Section where the value of the procur ement is estimated, in accordance with Section G, 
to equal or exceed the following relevant threshold.  Thresholds: 
 
 (To be adjusted according to the formula in Section G, paragraph 3)   For procurement of goods and services:  $460,000 
 
 For procurement of construction services:  $6,481,000  
Schedule Of Chile 
 
1. Municipalidad de Arica 
2. Municipalidad de Iquique 
3.  Municipalidad de Pozo Almonte 4.  Municipalidad de Pica 5.  Municipalidad de Huara 6.  Municipalidad de Camarones 
7.  Municipalidad de Putre 
8.  Municipalidad de General Lagos 9.  Municipalidad de Camiña 10.  Municipalidad de Colchane 11.  Municipalidad de Tocopilla 
12.  Municipalidad de Antofagasta  WT/REG160/1 
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13.  Municipalidad de Mejillones 
14.  Municipalidad de Taltal 15.  Municipalidad de Calama 16.  Municipalidad de Ollagüe 17.  Municipalidad de Maria Elena 
18.  Municipalidad de San Pedro De Atacama 
19.  Municipalidad de Sierra Gorda 20.  Municipalidad de Copiapó 21.  Municipalidad de Caldera 22.  Municipalidad de Tierra Amarilla 
23.  Municipalidad de Chañaral 
24.  Municipalidad de Diego De Almagro 25.  Municipalidad de Vallenar 26.  Municipalidad de Freirina 27.  Municipalidad de Huasco 
28.  Municipalidad de Alto Del Carmen 
29.  Municipalidad de La Serena 30.  Municipalidad de La Higuera 31.  Municipalidad de Vicuña 32.  Municipalidad de Paihuano 33.  Municipalidad de Coquimbo 
34.  Municipalidad de Andacollo 
35.  Municipalidad de Ovalle 36.  Municipalidad de Río Hurtado 37.  Municipalidad de Monte Patria 38.  Municipalidad de Punitaqui 
39.  Municipalidad de Combarbalá 
40.  Municipalidad de Illapel 41.  Municipalidad de Salamanca 42.  Municipalidad de Los Vilos 43.  Municipalidad de Canela 44.  Municipalidad de Valparaíso 
45.  Municipalidad de Viña Del Mar 
46.  Municipalidad de Quilpue 47.  Municipalidad de Villa Alemana 48.  Municipalidad de Casablanca 49.  Municipalidad de Quintero 
50.  Municipalidad de Puchuncaví 
51.  Municipalidad de Quillota 52.  Municipalidad de La Calera 53.  Municipalidad de La Cruz 54.  Municipalidad de Hijuelas 55.  Municipalidad de Nogales 
56.  Municipalidad de Limache 
57.  Municipalidad de Olmué 58.  Municipalidad de Isla De Pascua 59.  Municipalidad de San Antonio 60.  Municipalidad de Santo Domingo 
61.  Municipalidad de Cartagena 
62.  Municipalidad de El Tabo 63.  Municipalidad de El Quisco 64.  Municipalidad de Algarrobo 65.  Municipalidad de San Felipe 
66.  Municipalidad de Santa María WT/REG160/1 
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67.  Municipalidad de Putaendo 
68.  Municipalidad de Catemu 69.  Municipalidad de Panquehue 70.  Municipalidad de Llay - Llay 71.  Municipalidad de Los Andes 
72.  Municipalidad de San Esteban 
73.  Municipalidad de Calle Larga 74.  Municipalidad de Rinconada 75.  Municipalidad de La Ligua 76.  Municipalidad de Cabildo 
77.  Municipalidad de Petorca 
78.  Municipalidad de Papudo 79.  Municipalidad de Zapallar 80.  Municipalidad de Juan Fernández 81.  Municipalidad de Con - Con 
82.  Municipalidad de Buin 
83.  Municipalidad de Calera De Tango 84.  Municipalidad de Colina 85.  Municipalidad de Curacaví 86.  Municipalidad de El Monte 87.  Municipalidad de Isla De Maipo 
88.  Municipalidad de Pudahuel 
89.  Municipalidad de La Cisterna 90.  Municipalidad de Las Condes 91.  Municipalidad de La Florida 92.  Municipalidad de La Granja 
93.  Municipalidad de Lampa 
94.  Municipalidad de Conchalí 95.  Municipalidad de La Reina 96.  Municipalidad de Maipú 97.  Municipalidad de Estación Central 98.  Municipalidad de Melipilla 
99.  Municipalidad de Ñuñoa 
100.  Municipalidad de Paine 101.  Municipalidad de Peñaflor 102.  Municipalidad de Pirque 103.  Municipalidad de Providencia 
104.  Municipalidad de Puente Alto 
105.  Municipalidad de Quilicura 106.  Municipalidad de Quinta Normal 107.  Municipalidad de Renca 108.  Municipalidad de San Bernardo 109.  Municipalidad de San José De Maipo 
110.  Municipalidad de San Miguel 
111.  Municipalidad de Santiago 112.  Municipalidad de Talagante 113.  Municipalidad de Til Til 114.  Municipalidad de Alhué 
115.  Municipalidad de San Pedro 
116.  Municipalidad de Maria Pinto 117.  Municipalidad de San Ramón 118.  Municipalidad de La Pintana 119.  Municipalidad de Macul 
120.  Municipalidad de Peñalolen  WT/REG160/1 
 Page 77 
 
 
121.  Municipalidad de Lo Prado 
122.  Municipalidad de Cerro Navia 123.  Municipalidad de San Joaquín 124.  Municipalidad de Cerrillos 125.  Municipalidad de El Bosque 
126.  Municipalidad de Recoleta 
127.  Municipalidad de Vitacura 128.  Municipalidad de Lo Espejo 129.  Municipalidad de Lo Barnechea 130.  Municipalidad de Independencia 
131.  Municipalidad de Pedro Aguirre Cerda 
132.  Municipalidad de Huechuraba 133.  Municipalidad de Padre Hurtado 134.  Municipalidad de Rancagua 135.  Municipalidad de Machalí 
136.  Municipalidad de Graneros 
137.  Municipalidad de Codegua 138.  Municipalidad de Mostazal 139.  Municipalidad de Peumo 140.  Municipalidad de Las Cabras 141.  Municipalidad de San Vicente 
142.  Municipalidad de Pichidegua 
143.  Municipalidad de Doñihue 144.  Municipalidad de Coltauco 145.  Municipalidad de Rengo 146.  Municipalidad de Quinta De Tilcoco 
147.  Municipalidad de Requínoa 
148.  Municipalidad de Olivar 149.  Municipalidad de Coinco 150.  Municipalidad de Malloa 151.  Municipalidad de San Fernando 152.  Municipalidad de Chimbarongo 
153.  Municipalidad de Nancagua 
154.  Municipalidad de Placilla 155.  Municipalidad de Santa Cruz 156.  Municipalidad de Lolol 157.  Municipalidad de Chépica 
158.  Municipalidad de Pumanque 
159.  Municipalidad de Paredones 160.  Municipalidad de Palmilla 161.  Municipalidad de Litueche 162.  Municipalidad de Pichilemu 163.  Municipalidad de Marchihue 
164.  Municipalidad de La Estrella 
165.  Municipalidad de Navidad 166.  Municipalidad de Peralillo 167.  Municipalidad de Curicó 168.  Municipalidad de Romeral 
169.  Municipalidad de Teno 
170.  Municipalidad de Rauco 171.  Municipalidad de Licantén 172.  Municipalidad de Vichuquén 173.  Municipalidad de Hualañé 
174.  Municipalidad de Molina WT/REG160/1 
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175.  Municipalidad de Sagrada Familia 
176.  Municipalidad de Talca 177.  Municipalidad de San Clemente 178.  Municipalidad de Pelarco 179.  Municipalidad de Río Claro 
180.  Municipalidad de Pencahue 
181.  Municipalidad de Maule 182.  Municipalidad de Curepto 183.  Municipalidad de Constitución 184.  Municipalidad de Empedrado 
185.  Municipalidad de San Javier 
186.  Municipalidad de Linares 187.  Municipalidad de Yerbas Buenas 188.  Municipalidad de Colbún 189.  Municipalidad de Longaví 
190.  Municipalidad de Parral 
191.  Municipalidad de Retiro 192.  Municipalidad de Chanco 193.  Municipalidad de Cauquenes 194.  Municipalidad de Villa Alegre 195.  Municipalidad de Pelluhue 
196.  Municipalidad de San Rafael 
197.  Municipalidad de Chillán 198.  Municipalidad de Pinto 199.  Municipalidad de Coihueco 200.  Municipalidad de Ranquil 
201.  Municipalidad de Coelemu 
202.  Municipalidad de Quirihue 203.  Municipalidad de Ninhue 204.  Municipalidad de Portezuelo 205.  Municipalidad de Trehuaco 206.  Municipalidad de Cobquecura 
207.  Municipalidad de San Carlos 
208.  Municipalidad de Ñiquén 209.  Municipalidad de San Fabián 210.  Municipalidad de San Nicolás 211.  Municipalidad de Bulnes 
212.  Municipalidad de San Ignacio 
213.  Municipalidad de Quillón 214.  Municipalidad de Yungay 215.  Municipalidad de Pemuco 216.  Municipalidad de El Carmen 217.  Municipalidad de Concepción 
218.  Municipalidad de Penco 
219. Municipalidad de Hualqui 220.  Municipalidad de Florida 221.  Municipalidad de Tomé 222.  Municipalidad de Talcahuano 
223.  Municipalidad de Coronel 
224.  Municipalidad de Lota 225.  Municipalidad de Santa Juana 226.  Municipalidad de Lebu 227.  Municipalidad de Los Alamos 
228.  Municipalidad de Arauco  WT/REG160/1 
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229.  Municipalidad de Curanilahue 
230.  Municipalidad de Cañete 231.  Municipalidad de Contulmo 232.  Municipalidad de Tirúa 233.  Municipalidad de Los Angeles 
234.  Municipalidad de Santa Bárbara 
235.  Municipalidad de Laja 236.  Municipalidad de Quilleco 237.  Municipalidad de Nacimiento 238.  Municipalidad de Negrete 
239.  Municipalidad de Mulchén 
240.  Municipalidad de Quilaco 241.  Municipalidad de Yumbel 242.  Municipalidad de Cabrero 243.  Municipalidad de San Rosendo 
244.  Municipalidad de Tucapel 
245.  Municipalidad de Antuco 246.  Municipalidad de Chillán Viejo 247.  Municipalidad de San Pedro De La Paz 248.  Municipalidad de Chiguayante 249.  Municipalidad de Angol 
250.  Municipalidad de Purén 
251.  Municipalidad de Los Sauces 252.  Municipalidad de Renaico 253.  Municipalidad de Collipulli 254.  Municipalidad de Ercilla 
255.  Municipalidad de Traiguén 
256.  Municipalidad de Lumaco 257.  Municipalidad de Victoria 258.  Municipalidad de Curacautín 259.  Municipalidad de Lonquimay 260.  Municipalidad de Temuco 
261.  Municipalidad de Vilcún 
262.  Municipalidad de Freire 263.  Municipalidad de Cunco 264.  Municipalidad de Lautaro 265.  Municipalidad de Perquenco 
266.  Municipalidad de Galvarino 
267.  Municipalidad de Nueva Imperial 268.  Municipalidad de Carahue 269.  Municipalidad de Saavedra 270.  Municipalidad de Pitrufquén 271.  Municipalidad de Gorbea 
272.  Municipalidad de Toltén 
273.  Municipalidad de Loncoche 274.  Municipalidad de Villarrica 275.  Municipalidad de Pucón 276.  Municipalidad de Melipeuco 
277.  Municipalidad de Curarrehue 
278.  Municipalidad de Teodoro Schmidt 279.  Municipalidad de Padre De Las Casas 280.  Municipalidad de Valdivia 281.  Municipalidad de Corral 
282.  Municipalidad de Mariquina WT/REG160/1 
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283.  Municipalidad de Mafil 
284.  Municipalidad de Lanco 285.  Municipalidad de Los Lagos 286.  Municipalidad de Futrono 287.  Municipalidad de Panguipulli 
288.  Municipalidad de La Unión 
289.  Municipalidad de Paillaco 290.  Municipalidad de Río Bueno 291.  Municipalidad de Lago Ranco 292.  Municipalidad de Osorno 
293.  Municipalidad de Puyehue 
294.  Municipalidad de San Pablo 295.  Municipalidad de Puerto Octay 296. Municipalidad de Río Negro 297.  Municipalidad de Purranque 
298.  Municipalidad de Puerto Montt 
299.  Municipalidad de Calbuco 300.  Municipalidad de Puerto Varas 301.  Municipalidad de Llanquihue 302.  Municipalidad de Fresia 303.  Municipalidad de Frutillar 
304.  Municipalidad de Maullín 
305.  Municipalidad de Los Muermos 306.  Municipalidad de Ancud 307.  Municipalidad de Quemchi 308.  Municipalidad de Dalcahue 
309.  Municipalidad de Castro 
310.  Municipalidad de Chonchi 311.  Municipalidad de Queilén 312.  Municipalidad de Quellón 313.  Municipalidad de Puqueldón 314.  Municipalidad de Quinchao 
315.  Municipalidad de Curaco De Velez 
316.  Municipalidad de Chaitén 317.  Municipalidad de Palena 318.  Municipalidad de Futaleufú 319.  Municipalidad de San Juan De La Costa 
320.  Municipalidad de Cochamo 
321. Municipalidad de Hualaihue 322. Municipalidad de Aysén 323.  Municipalidad de Cisnes 324.  Municipalidad de Coyhaique 325.  Municipalidad de Chile Chico 
326.  Municipalidad de Cochrane 
327.  Municipalidad de Lago Verde 328.  Municipalidad de Guaitecas 329.  Municipalidad de Río Ibañez 330.  Municipalidad de O’higgins 
331.  Municipalidad de Tortel 
332.  Municipalidad de Punta Arenas 333.  Municipalidad de Puerto Natales 334.  Municipalidad de Porvenir 335.  Municipalidad de Torres Del Paine 
336.  Municipalidad de Rio Verde  WT/REG160/1 
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337.  Municipalidad de Laguna Blanca 
338.  Municipalidad de San Gregorio 339.  Municipalidad de Primavera 340.  Municipalidad de Timaukel 341.  Municipalidad de Navarino 
 
Schedule Of The United States 
 
Arizona
 
Executive branch agencies 
 
Arkansas  
Executive branch agencies, including universities but  excluding the Office of Fish and Game and 
construction services  
California
 
Executive branch agencies  Colorado
 
Executive branch agencies  
Connecticut
 
Department of Administrative Services Connecticut Department of Transportation Connecticut Department of Public Works Constituent Units of Higher Education 
 
Delaware*
 
Administrative Services (Central Procurement Agency) State Universities State Colleges  
Florida*
 
Executive branch agencies  Hawaii
 
Department of Accounting and General Services (w ith the exception of procurements of software 
developed in the state and construction) 
 Idaho
 
Central Procurement Agency (including all colle ges and universities subject to central purchasing 
oversight)  
Illinois*
 
Department of Central Management Services  Iowa*
 
Department of General Services 
Department of Transportation 
Board of Regents’ Institutions (universities)  Kansas
 
Executive branch agencies, excluding construc tion services, automobiles and aircraft  
 WT/REG160/1 
Page 82  
 
Kentucky
 
Division of Purchases, Finance and Administra tion Cabinet, excluding construction projects 
 Louisiana
 
Executive branch agencies 
 
Maine*  
Department of Administrative and Financial Services Bureau of General Services (covering state government agencies and school construction) 
Maine Department of Transportation 
 
Maryland*
 
Office of the Treasury Department of the Environment Department of General Services 
Department of Housing and Community Development 
Department of Human Resources Department of Licensing and Regulation Department of Natural Resources Department of Public Safety and Correctional Services Department of Personnel 
Department of Transportation 
 Massachusetts
 
Executive Office for Administration and Finance Executive Office of Communities and Development 
Executive Office of Consumer Affairs 
Executive Office of Economic Affairs Executive Office of Education Executive Office of Elder Affairs Executive Office of Environmental Affairs Executive Office of Health and Human Service 
Executive Office of Labor 
Executive Office of Public Safety Executive Office of Transportation and Construction  Michigan*
 
Department of Management and Budget 
 Minnesota
 
Executive branch agencies  Mississippi
 
Department of Finance and Administration (does not include services) 
 Missouri
 
Office of Administration Division of Purchasing and Materials Management 
 
Montana
 
Executive branch agencies (only for services and construction)  Nebraska
 
Central Procurement Agency  WT/REG160/1 
 Page 83 
 
 
New Hampshire*  
Central Procurement Agency  New York*
 
State agencies 
State university system 
Public authorities and public benefit corporations, with the exception of those entities with multi-state 
mandates In addition to the exceptions noted at the end of th is Section, transit cars, buses and related equipment 
are not covered. 
 
Oklahoma*
 
Office of Public Affairs and all state agencies and departments subject to the Oklahoma Central Purchasing Act, excluding construction services.  
Oregon
 
Department of Administrative Services  Pennsylvania*
 
Executive branch agencies, including: Governor’s Office 
Department of the Auditor General 
Treasury Department Department of Agriculture Department of Banking Pennsylvania Securities Commission 
Department of Health 
Department of Transportation Insurance Department Department of Aging Department of Correction Department of Labor and Industry 
Department of Military Affairs 
Office of Attorney General Department of General Services Department of Education Public Utility Commission 
Department of Revenue 
Department of State Pennsylvania State Police Department of Public Welfare Fish Commission Game Commission 
Department of Commerce 
Board of Probation and Parole Liquor Control Board Milk Marketing Board Lieutenant Governor’s Office 
Department of Community Affairs 
Pennsylvania Historical and Museum Commission Pennsylvania Emergency Management Agency State Civil Service Commission Pennsylvania Public Television Network 
Department of Environmental Resources WT/REG160/1 
Page 84  
 
State Tax Equalization Board Department of Public Welfare State Employees’ Retirement System Pennsylvania Municipal Retirement Board Public School Employees’ Retirement System 
Pennsylvania Crime Commission 
Executive Offices  Rhode Island
 
Executive branch agencies, excluding boats, automobiles, buses and related equipment 
 
South Dakota  
Central Procuring Agency (including  universities and penal institutions) 
In addition to the exceptions noted at the end of this  Section, procurements of beef are not covered. 
 
Tennessee  
Executive branch agencies (excluding services and construction)  Texas
 
Texas Building and Procurement Commission  
Utah
 
Executive branch agencies  Vermont
 
Executive branch agencies 
 
Washington  
Washington State executive branch agencies, including: General Administration Department of Transportation State Universities 
In addition to the exceptions noted at the end of th is Section, procurements  of fuel, paper products, 
boats, ships and vessels are not covered.  Wisconsin
 
Executive branch agencies, including: 
Department of Administration 
State Correctional Institutions Department of Development Educational Communications Board Department of Employment Relations State Historical Society 
Department of Health and Social Services 
Insurance Commissioner Department of Justice Lottery Board Department of Natural Resources 
Administration for Public Instruction 
Racing Board Department of Revenue State Fair Park Board Department of Transportation 
State University System  WT/REG160/1 
 Page 85 
 
 
Wyoming*  
Procurement Services Division Wyoming Department of Transportation University of Wyoming  U.S. Notes 
 
1. For those states marked by an asterisk with pr e-existing restrictions, the Chapter does not 
apply to procurement of construction-grade steel (including requirements on subcontracts), motor 
vehicles and coal. 
2. Nothing in this Section shall be construe d to prevent any state entity from applying 
restrictions that promote the general environmental quality in that state, as long as such restrictions 
are not disguised barriers to international trade. 
3. This Chapter shall not apply to any procurement made by a covered entity on behalf of non-
covered entities at a different level of government. 
4. This Chapter shall not apply to restrictions attached to Federal funds for mass transit and 
highway projects. 
5. This Chapter shall not apply to State Governme nt Entities’ procurements of printing services. 
6. This Chapter shall not apply to preferences or restrictions associated with programs 
administered by entities that promote the devel opment of distressed areas and businesses owned by 
minorities, disabled veterans, and women. 
 
Section C - Other Covered Entities
 
 
 This Agreement applies to procurement by the Other Covered Entities  listed in this Section 
where the value of the procurement is estimated, in accordance with Section G, to equal or exceed the 
following relevant threshold. 
 
Thresholds: 
 
 For goods and services of List A Entities   
 (To be adjusted according to the formula in Section G, paragraph 2):  $280,951 
  For goods and services of List B Entities   (To be adjusted according to the formula in Section G, paragraph 3):  $518,000 
 
 For construction services of List A and List B Entities   (To be adjusted according to the formula in Section G, paragraph 3):  $6,481,000 
  
 
    WT/REG160/1 
Page 86  
 
Schedule Of Chile 
 
List A: 
 
1. Empresa Portuaria Arica 
2.  Empresa Portuaria Iquique 
3. Empresa Portuaria Antofagasta 4. Empresa Portuaria Coquimbo 5. Empresa Portuaria Valparaíso 6. Empresa Portuaria San Antonio 
7. Empresa Portuaria San Vicente-Talcahuano 
8.  Empresa Portuaria Puerto Montt 9. Empresa Portuaria Chacabuco 10.  Empresa Portuaria Austral 11.  Aeropuertos de propiedad del Estado, de pendientes de la Dirección de Aeronáutica Civil 
 
 
Schedule Of The United States 
 
List A: 
 1.  Tennessee Valley Authority 
2.  Bonneville Power Administration 3.  Western Area Power Administration 4.  Southeastern Power Administration 5.  Southwestern Power Administration 
6.  St. Lawrence Seaway Development Corporation 
 
List B: 
 
1. The Port Authority of New York and Ne w Jersey, with the following exceptions: 
(a) maintenance, repair and operating material s and supplies (e.g., hardware, tools, 
lamps/lighting, plumbing); 
(b) in exceptional cases, individual procurements  may require certain regional production 
of goods if authorized by the Board of Directors; and, 
(c) procurements pursuant to multi-jurisdicti onal agreement (i.e., for contracts which 
have initially been awarded by other jurisdictions). 
2. The Port of Baltimore (not including procurement of transit cars, buses and related equipment 
and subject to the conditions specified for the state of New York in Section B)  
3. The New York Power Authority (not including pr ocurement of transit cars, buses and related 
equipment and subject to the conditions specified  for the state of New York in Section B) 
4. Rural Utilities Service Financing: 
(a) waiver of Buy American restriction on fi nancing for all power generation projects 
(restrictions on financing for telecommunication projects) are excluded from the 
Chapter;  WT/REG160/1 
 Page 87 
 
 
(b) application of WTO Government Procurem ent Agreement – equivalent procurement 
procedures and national treatment to f unded projects exceeding the thresholds 
specified above. 
U.S. Notes 
 1. With respect to procurement by entities listed in this Section, this Chapter shall not apply to 
restrictions attached to Federal funds for airport projects. 
 
Section D – Goods
 
  This Chapter applies to all goods procured by  the entities listed in Annex 9.1, Sections (A) 
through (C), subject to the Notes to the respective Sections and the General Notes. (For complete 
listing of U.S. Federal Supply Classifica tion, see http://www.scrantonrtg.com/secrc/fsc-
codes/fsc.html.) 
  
Section E – Services
 
 
 This Chapter applies to all services procured by the entities listed in Annex 9.1, Sections (A) 
through (C), subject to the Notes to the respective Sections, the General Notes, and the Notes to this 
Section, except for the services in the categori es of the Common Classification System excluded in 
the Schedules of each Party. (For complete listing of the Common Classification System, see 
http://www.sice.oas.org/trade/nafta/chap-105.asp.) 
 
 
Schedule Of Chile 
 
 The following services, as elaborated in th e Common Classification System, are excluded: 
 L.  Financial and Related Services    All classes 
 
Schedule Of The United States 
 
 The following services, as elaborated in th e Common Classification System, are excluded: 
 
A.  Research and Development 
   All classes  D.  Information Processing and Related Telecommunications Services   
 D304  ADP Telecommunications and Transm ission Services, except for those services 
classified as “enhanced or value-added ser vices.” For purposes of this provision, the 
procurement of “ADP Telecommunications and Transmission services” does not include the ownership or furnishing of facilities for the transmission of voice or data services. 
 D305 ADP Teleprocessing and Timesharing Services 
 D316 Telecommunications Ne twork Management Services 
 D317 Automated News Services, Data Services or Other Information Services 
 D399 Other ADP and Telecommunications Services WT/REG160/1 
Page 88  
 
 J.  Maintenance, Repair, Modification, Rebuilding and Installation of Equipment 
  J019  Maintenance, Repair, Modification, Re building and Installation of Equipment Related 
to Ships 
 J998  Non-nuclear Ship Repair 
 M.  Operation of Government-Owned Facilities 
All facilities operated by the Department of Defe nse, Department of Energy and the National 
Aeronautics and Space Administration; and for all entities: 
 
 M180 Research and Development  S.  Utilities  
 All Classes 
 V.  Transportation, Travel and Relocation Services   All Classes except V503 Travel Agent Services  U.S. Notes: 
  
 All services purchased in support of military forces overseas are excluded from coverage of this Chapter. 
 
Section F – Construction Services
 
 
 This Chapter applies to all construction servi ces procured by the Entities listed in Annex 9.1, 
Sections (A) through (C), subject to the Notes to the respective sections, the General Notes, and the 
Notes to this Section, except for the constructi on services set out in the Schedules to this Annex. 
 
Schedule Of Chile 
 
 No construction services are excluded.  
Schedule Of The United States 
 
 The following construction services are excluded:   Dredging.  
U.S. Notes: 
 
 In accordance with this Chapter, buy national requirements on articles, supplies and materials 
acquired for use in construction contracts covered by  this Chapter shall not apply to goods of Chile. 
  
Section G – Threshold Adjustment Formulas
 
 
1. In calculating the value of a contract for the purpose of ascertaining whether the procurement 
is covered by this Chapter, an entity shall in clude the maximum total estimated value of the 
procurement over its entire duration, taking into account all options, premiums, fees, commissions, 
interest and other revenue streams or other forms of renumeration provided for in such contracts.  WT/REG160/1 
 Page 89 
 
 
2. The calculations referred to in Annex 9.1, Sections (A) through (C) that specifically 
referenced this paragraph shall be ma de in accordance with the following: 
(a) the U.S. inflation rate shall be measured by the Producer Price Index for Finished 
Goods published by the U.S. Bureau of Labor Statistics; 
(b) the first adjustment for inflation, to take effect on January 1, 2004, shall be calculated 
using the period from November 1, 2001 through October 31, 2003; 
(c) all subsequent adjustments shall be calcu lated using two-year periods, each period 
beginning November 1, and shall take effe ct on January 1 of the year immediately 
following the end of the two-year period; 
(d) the United States shall notify Chile of the adjusted threshold values no later than 
November 16 of the year before the adjustment takes effect; 
(e) the inflationary adjustment shall be estim ated according to the following formula: 
T0 x (1+ ð i) = T 1 
   T
0 = threshold value at base period 
  ð i = accumulated U.S. inflation rate for the ith two year-period 
  T 1 = new threshold value. 
 
(f) Chile shall calculate and convert the value of the thresholds applicable to this 
paragraph into Chilean currency using the c onversion formula set out in subparagraph 
(g). Chile shall notify the United States of  the value in its currency of the newly 
calculated thresholds no later than one mont h before the thresholds take effect; and 
(g) Chile shall use for its calculation the offici al conversion rate of the Central Bank of 
Chile ( Banco Central de Chile ). Its conversion rate shall be the existing value of the 
Chilean currency in terms of U.S. dollars as of December 1 and June 1 of each year, or the first working day thereafter. The c onversion rate as of December 1 shall apply 
from January 1 to June 30 of the following year, and as of June 1 shall apply from 
July 1 to December 31 of that year. 
3. The calculations referred to in Annex 9.1, Sections (A) through (C) that specifically 
referenced this paragraph shall be ma de in accordance with the following: 
(a) Chile shall calculate and convert the value of the thresholds applicable to this 
paragraph into its national currency using the conversion rates published by the IMF 
in its monthly “International Financial Sta tistics”. Chile shall notify the United States 
without delay of the methodology used and the results of its calculations;  
(b) the conversion rates shall be the average of  the daily values of the respective national 
currency in terms of the Standard Draw ing Right (SDR) over the two-year period 
preceding October 1 or November 1 of the year prior to the thresholds in national 
currency becoming effective, which shall be from January 1; 
(c) thresholds shall be fixed for two years, i.e. calendar years for all Parties where the 
fiscal year (1 April-31 March) will be used; and WT/REG160/1 
Page 90  
 
(d) the Parties agree that if a major change in a national currency vis-a-vis the SDR 
during a year were to create a significant problem with regard to the application of the Chapter, they shall consult as to whethe r an interim adjustment is appropriate. 
 
Section H - General Notes
 
 
Schedule Of Chile 
 
 None.  
Schedule Of The United States 
 
1. This Chapter does not apply to set-asides on behalf of small a nd minority businesses. 
2. This Chapter does not apply to the procurement of  transportation services that form a part of, 
or are incidental to, a procurement contract. 
3. Where a contract to be awarded by an entity is not covered by this Chapter, nothing in this 
Chapter shall be construed to cover any good  or service component of that contract. 
 
CHAPTER TEN : INVESTMENT 
 
Section A - Investment
 
 
Article 10.1 
 
Scope And Coverage1 
 
1. This Chapter applies to measures adopted or maintained by a Party relating to: 
(a) investors of the other Party; 
(b) covered investments; and 
(c) with respect to Articles 10.5 and 10.12, all investments in the territory of the Party. 
2. In the event of any inconsistency between this Chapter and another Chapter, the other Chapter 
shall prevail to the extent of the inconsistency. 
3. A requirement by a Party that a service provider of the other Party post a bond or other form 
of financial security as a condition of providing a ser vice into its territory does not of itself make this 
Chapter applicable to the provision of that cross-bor der service. This Chapter applies to that Party’s 
treatment of the posted bond or financial security. 
4. This Chapter does not apply to measures adopted or maintained by a Party to the extent that 
they are covered by Chapter Twelve (Financial Services). 
                                                      
1 For greater certainty, the provisions of this Chapter do not bind either Party in relation to any act or 
fact that took place or any s ituation that ceased to exist before the date  of entry into force of this Agreement. 
Also, for greater certainty, this Chapter is subject to an d shall be interpreted in accordance with Annexes 10-A 
through 10-H.  WT/REG160/1 
 Page 91 
 
 
Article 10.2 
 
National Treatment  
 1. Each Party shall accord to investors of the othe r Party treatment no less favourable than that it 
accords, in like circumstances, to its own investor s with respect to the establishment, acquisition, 
expansion, management, conduct, operation, and sale or other di sposition of investments in its 
territory. 
2. Each Party shall accord to covered investme nts treatment no less favourable than that it 
accords, in like circumstances, to investments in its territory of its own investors with respect to the 
establishment, acquisition, expansion, management , conduct, operation, and sale or other disposition 
of investments. 
3. The treatment to be accorded by a Party under paragraphs 1 and 2 means, with respect to a 
regional level of government, treatment no less favourable than the most favourable treatment 
accorded, in like circumstances, by that regional leve l of government to investors, and to investments 
of investors, of the Party of which it forms a part.  
Article 10.3 
 
Most-Favored-Nation Treatment
 
 1. Each Party shall accord to investors of the othe r Party treatment no less favourable than that it 
accords, in like circumstances, to investors of any non-Party with respect to the establishment, 
acquisition, expansion, management , conduct, operation, and sale or other disposition of investments 
in its territory. 
2. Each Party shall accord to covered investme nts treatment no less favourable than that it 
accords, in like circumstances, to investments in its territory of investor s of any non-Party with 
respect to the establishment, acquisition, expans ion, management, conduct, operation, and sale or 
other disposition of investments. 
Article 10.4 
 
Minimum Standard Of Treatment
2 
 
1. Each Party shall accord to covered investme nts treatment in accordance with customary 
international law, including fair and equita ble treatment and full protection and security. 
2. For greater certainty, paragraph 1 prescribes  the customary international law minimum 
standard of treatment of aliens as the minimum st andard of treatment to be afforded to covered 
investments. The concepts of “fair and equitable treatment” and “full protection and security” do not 
require treatment in addition to or beyond that whic h is required by that standard, and do not create 
additional substantive rights. The oblig ation in paragraph 1 to provide: 
(a) “fair and equitable treatment” includes the ob ligation not to deny justice in criminal, 
civil, or administrative adjudicatory proceed ings in accordance with the principle of 
due process embodied in the principal legal systems of the world; and 
(b) “full protection and security” requires each Party to provide the level of police 
protection required under customary international law.  
                                                      
2 For greater certainty, Article  10.4 shall be interpreted in accordance with Annex 10-A. WT/REG160/1 
Page 92  
 
3. A determination that there has been a breach of another provision of this Agreement, or of a 
separate international agreement, does not establish that there has been a breach of this Article. 
4. Notwithstanding Article 10.7(5)(b), each Party sh all accord to investors of the other Party, 
and to covered investments, non-discriminatory tr eatment with respect to measures it adopts or 
maintains relating to losses suffered by investments in  its territory owing to armed conflict or civil 
strife. 
5. Notwithstanding paragraph 4, if an investor of a Party, in the situations referred to in that 
paragraph, suffers a loss in the territory of the other Party resulting from: 
(a) requisitioning of its covered investment or part thereof by the latter’s forces or 
authorities; or 
(b) destruction of its covered investment or part thereof by the latter’s forces or 
authorities, which was not required by the necessity of the situation, 
the latter Party shall provide the investor restitution or compensation, which in either case shall be 
prompt, adequate, and effective, and, with resp ect to compensation, shall be in accordance with 
Article 10.9(2) through (4). 
 
6. Paragraph 4 does not apply to existing measures re lating to subsidies or grants that would be 
inconsistent with Article 10. 2 but for Article 10.7(5)(b). 
Article 10.5 
 
Performance Requirements
 
 
Mandatory Performance Requirements 
 
1. Neither Party may impose or enforce any of the following requirements, or enforce any 
commitment or undertaking, in connection wi th the establishment, acquisition, expansion, 
management, conduct, operation, or sale or other dispos ition of an investment of an investor of a Party 
or of a non-Party in its territory: 
(a) to export a given level or percentage of goods or services; 
(b) to achieve a given level or pe rcentage of domestic content; 
(c) to purchase, use, or accord a preference to  goods produced in its territory, or to 
purchase goods from persons in its territory; 
(d) to relate in any way the volume or value of  imports to the volume or value of exports 
or to the amount of foreign exchange in flows associated with such investment; 
(e) to restrict sales of goods or services in its territory that such investment produces or 
supplies by relating such sales in any way to the volume or value of its exports or foreign exchange earnings; 
(f) to transfer a particular technology, a production process, or other proprietary 
knowledge to a person in its territory; or 
(g) to supply exclusively from the territory of  the Party the goods that it produces or the 
services that it supplies to a specific re gional market or to the world market.  WT/REG160/1 
 Page 93 
 
 
Advantages Subject To Performance Requirements 
 
2. Neither Party may condition the receipt or contin ued receipt of an advantage, in connection 
with the establishment, acquisition, expansion, ma nagement, conduct, operation, or sale or other 
disposition of an investment in its territory of an investor of a Party or of a non-Party, on compliance 
with any of the following requirements: 
(a) to achieve a given level or pe rcentage of domestic content; 
(b) to purchase, use, or accord a preference to  goods produced in its territory, or to 
purchase goods from persons in its territory; 
(c) to relate in any way the volume or value of  imports to the volume or value of exports 
or to the amount of foreign exchange infl ows associated with such investment; or 
(d) to restrict sales of goods or services in its territory that such investment produces or 
supplies by relating such sales in any way to the volume or value of its exports or foreign exchange earnings. 
Exceptions And Exclusions 
 
3. (a) Nothing in paragraph 2 shall be constr ued to prevent a Party from conditioning the 
receipt or continued receipt of an advantage, in connection with an investment in its territory of an investor of a Party or of a non-Party, on compliance with a requirement to locate production, supply a service, train or employ workers, construct or expand particular facilities, or carry out research and development, in its territory. 
(b) Paragraph 1(f) does not apply: 
(i) when a Party authorizes use of an in tellectual property right in accordance 
with Article 31
3 of the TRIPS Agreement, or to measures requiring the 
disclosure of proprietary information th at fall within the scope of, and are 
consistent with, Article 39 of the TRIPS Agreement; or 
(ii) when the requirement is imposed or the commitment or undertaking is 
enforced by a court, administrative tribunal, or competition authority to remedy a practice determined after judicial or administrative process to be anticompetitive under the Party’s competition laws.
4 
(c) Provided that such measures are not applied in  an arbitrary or unjustifiable manner, or 
do not constitute a disguised restriction on international trade or investment, 
paragraphs 1(b), (c), and (f),  and 2(a) and (b), shall not  be construed to prevent a 
Party from adopting or maintaining measures, including environmental measures: 
(i) necessary to secure compliance with laws and regulations that are not 
inconsistent with this Agreement; 
(ii) necessary to protect human, animal, or plant life or health; or 
(iii) related to the conservation of living  or non-living exhaustible natural 
resources. 
                                                      
3 The reference to “Article 31” includes footnote 7 to Article 31. 
4 The Parties recognize that a patent doe s not necessarily confer market power. WT/REG160/1 
Page 94  
 
(d) Paragraphs 1(a), (b), and (c), and 2(a)  and (b), do not apply to qualification 
requirements for goods or services with respect to export promotion and foreign aid programs. 
(e) Paragraphs 1(b), (c), (f), and (g), and 2( a) and (b), do not apply to procurement. 
(f) Paragraphs 2(a) and (b) do not apply to requirements imposed by an importing Party 
relating to the content of goods necessary to qualify for preferential tariffs or 
preferential quotas. 
4. For greater certainty, paragraphs 1 and 2 do not apply to any requirement other than the 
requirements set out in those paragraphs. 
5. This Article does not preclude enforcement of any commitment, undertaking, or requirement 
between private parties, where a Party did not im pose or require the commitment, undertaking, or 
requirement. 
Article 10.6 
 
Senior Management And Boards Of Directors
 
 
1. Neither Party may require that an enterprise of th at Party that is a covered investment appoint 
to senior management positions individuals of any particular nationality. 
2. A Party may require that a majority of the board of directors, or any committee thereof, of an 
enterprise of that Party that is a covered investment, be of a particular nationality, or resident in the 
territory of the Party, provided that the require ment does not materially impair the ability of the 
investor to exercise control over its investment. 
Article 10.7 
 
Non-Conforming Measures5 
 
1. Articles 10.2, 10.3, 10.5, and 10.6 do not apply to: 
(a) any existing non-conforming measure that  is maintained by a Party at: 
(i) the central level of government, as set out by that Party in its Schedule to 
Annex I, 
(ii) a regional level of government, as set out  by that Party in its Schedule to 
Annex I, or 
(iii) a local level of government; 
(b) the continuation or prompt renewal of an y non-conforming measure referred to in 
subparagraph (a); or 
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the 
extent that the amendment does not decr ease the conformity of the measure, as it 
existed immediately before the amendment, with Articles 10.2, 10.3, 10.5, and 10.6. 
                                                      
5 For greater certainty, Article 10.7 is subject to Annex 10-B.  WT/REG160/1 
 Page 95 
 
 
2. Articles 10.2, 10.3, 10.5, and 10.6 do not apply to any measure that a Party adopts or 
maintains with respect to sectors, subsectors, or activities, as set out in its Schedule to Annex II. 
3. Neither Party may, under any measure adopted after the date of entry into force of this 
Agreement and covered by its Schedul e to Annex II, require an investor of the other Party, by reason 
of its nationality, to sell or otherwise dispose of  an investment existing at the time the measure 
becomes effective. 
4. Articles 10.2 and 10.3 do not apply to any measure that is an exception to, or derogation from, 
the obligations under Article 17.1(6) (General Provisi ons) as specifically provided for in that Article. 
5. Articles 10.2, 10.3, and 10.6 do not apply to: 
(a) procurement; or 
(b) subsidies or grants provided by a Party, including government-supported loans, 
guarantees, and insurance. 
Article 10.8 
 
Transfers6 
 
1. Each Party shall permit all transfers relating to  a covered investment to be made freely and 
without delay into and out of its territory. Such transfers include: 
(a) contributions to capital; 
(b) profits, dividends, interest, capital gains, royalty payments, management fees, and 
technical assistance and other fees;  
(c) proceeds from the sale of all or any part of  the covered investment or from the partial 
or complete liquidation of the covered investment; 
(d) payments made under a contract entered into by the investor, or the covered 
investment, including payments made pursuant to a loan agreement; 
(e) payments made pursuant to Article 10. 4(4) and (5) and Article 10.9; and 
(f) payments arising under Section B. 
2. Each Party shall permit returns in kind relati ng to a covered investment to be made as 
authorized or specified in an investment authorization or other written agreement7 between the Party 
and a covered investment or an investor of the other Party. 
3. Each Party shall permit transfers relating to a covered investment to be made in a freely 
usable currency at the market rate of exch ange prevailing on the date of transfer. 
4. Neither Party may require its investors to transfer , or penalize its investors that fail to transfer, 
the income, earnings, profits, or other amounts derive d from, or attributable to, investments in the 
territory of the other Party. 
                                                      
6 For greater certainty, Article 10.8 is subject to Annex 10-C. 
7 Notwithstanding any other provision of this Chapter, this paragraph takes effect on the date of entry 
into force of this Agreement. WT/REG160/1 
Page 96  
 
5. Notwithstanding paragraphs 1 through 3, a Party may prevent a transfer through the equitable, 
nondiscriminatory, and good faith appl ication of its laws relating to: 
(a) bankruptcy, insolvency, or the protection of the rights of creditors; 
(b) issuing, trading, or dealing in securities, futures, or derivatives; 
(c) criminal or penal offenses; 
(d) financial reporting or record keeping of  transfers when necessary to assist law 
enforcement or  financial regulatory authorities; or 
(e) ensuring compliance with orders or judgments in judicial or administrative 
proceedings. 
6. Notwithstanding paragraph 2, a Party may restrict transfers of returns in kind in 
circumstances where it could otherw ise restrict such transfers under this Agreement, including as set 
out in paragraph 5. 
Article 10.9 
 
Expropriation And Compensation
8 
 
1. Neither Party may expropriate or nationalize a cove red investment either directly or indirectly 
through measures equivalent to expropriation or nationalization (“expropriation”), except: 
(a) for a public purpose; 
(b) in a non-discriminatory manner; 
(c) on payment of prompt, adequate, and effective compensation in accordance with 
paragraphs 2 through 4; and 
(d) in accordance with due process of la w and Article 10.4(1) through (3). 
2. Compensation shall: 
(a) be paid without delay; 
(b) be equivalent to the fair market value of  the expropriated investment immediately 
before the expropriation took place (“the date of expropriation”); 
(c) not reflect any change in value occurr ing because the intended expropriation had 
become known earlier; and 
(d) be fully realizable and freely transferable. 
3. If the fair market value is denominated in a freely usable currency, the compensation paid 
shall be no less than the fair market value on the date  of expropriation, plus interest at a commercially 
reasonable rate for that currency, accrued from the da te of expropriation until the date of payment. 
                                                      
8 For greater certainty, Article 10.9 shall be interprete d in accordance with Annex 10-A and         
Annex 10-D.  WT/REG160/1 
 Page 97 
 
 
4. If the fair market value is denominated in  a currency that is not freely usable, the 
compensation paid – converted into the currency of pa yment at the market rate  of exchange prevailing 
on the date of payment – shall be no less than: 
(a) the fair market value on the date of expropriation, converted into a freely usable 
currency at the market rate of exchange prevailing on that date, plus 
(b) interest, at a commercially reasonable rate for that freely usable currency, accrued 
from the date of expropriation until the date of payment. 
5. This Article does not apply to the issuance of  compulsory licenses granted in relation to 
intellectual property rights in accordance with the TR IPS Agreement, or to the revocation, limitation, 
or creation of intellectual property rights, to the exte nt that such revocation, limitation, or creation is 
consistent with Chapter Sevent een (Intellectual Property Rights). 
Article 10.10 
 
Special Formalities And Information Requirements  
 
1. Nothing in Article 10.2 shall be construed to prevent a Party from adopting or maintaining a 
measure that prescribes special formalities in co nnection with covered investments, such as a 
requirement that investors be residents of the Part y or that covered investments be legally constituted 
under the laws or regulations of the Party, provided  that such formalities do not materially impair the 
protections afforded by a Party to investors of the other Party and covered investments pursuant to 
this Chapter. 
2. Notwithstanding Articles 10.2 and 10.3, a Party may require an investor of the other Party, or 
a covered investment, to provide in formation concerning that investment solely for informational or 
statistical purposes. The Party shall protect such in formation that is confidential from any disclosure 
that would prejudice the competitive position of the investor or the covered investment. Nothing in this paragraph shall be constr ued to prevent a Party from otherwise obtaining or disclosing 
information in connection with the equitable a nd good faith application of its domestic law. 
Article 10.11 
 
Denial Of Benefits
 
 1. A Party may deny the benefits of this Chapter to an investor of the other Party that is an 
enterprise of such other Party and to investments of th at investor if an investor of a non-Party owns or 
controls the enterprise and the denying Party: 
(a) does not maintain diplomatic relations with the non-Party; or 
(b) adopts or maintains measures with respect to  the non-Party or an investor of the non-
Party that prohibit transactions with the enterprise or that would be violated or 
circumvented if the benefits of this Chapte r were accorded to the enterprise or to its 
investments. 
2. Subject to Article 22.4 (Consultations), a Party may deny the benefits of this Chapter to: 
(a) an investor of the other Party that is an enterprise of such other Party and to 
investments of that investor if an inv estor of a non-Party owns or controls the 
enterprise and the enterprise has no substan tial business activities in the territory of 
the other Party; or WT/REG160/1 
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(b) an investor of the other Party that is an enterprise of such other Party and to 
investments of that investor if an investor of the denying Party owns or controls the enterprise and the enterprise has no substan tial business activities in the territory of 
the other Party. 
Article 10.12 
 
Investment And Environment
 
  Nothing in this Chapter shall be construed to  prevent a Party from adopting, maintaining, or 
enforcing any measure otherwise consistent with this  Chapter that it considers appropriate to ensure 
that investment activity in its territory is undertak en in a manner sensitive to environmental concerns. 
 
Article 10.13 
 
Implementation
 
 
 The Parties shall consult annually, or as othe rwise agreed, to review  the implementation of 
this Chapter and consider any investment matter of  mutual interest, including consideration of the 
development of procedures that could contribute to greater transparency of measures described in Article 10.7(1)(c).  
Section B - Investor-State Dispute Settlement
 
 
Article 10.14 
 
Consultation And Negotiation  
 
 In the event of an investment dispute, the cl aimant and the respondent should initially seek to 
resolve the dispute through consultation and nego tiation, which may include the use of non-binding, 
third-party procedures.  
Article 10.15 
 
Submission Of A Claim To Arbitration
9 
 1. In the event that a disputing party considers th at an investment dispute cannot be settled by 
consultation and negotiation: 
(a) the claimant, on its own behalf, may submit to  arbitration under this Section a claim 
(i) that the respondent has breached 
   (A) an obligation under Section A or Annex 10-F, 
    (B) an investment authorization, or  
   (C) an investment agreement; 
  and  
(ii) that the claimant has incurred loss or damage by reason of, or arising out of, 
that breach; and 
                                                     
 
9 For greater certainty, Article 10.15 is subject to Annex 10-E.  WT/REG160/1 
 Page 99 
 
 
(b) the claimant, on behalf of an enterprise of th e respondent that is a juridical person that 
the claimant owns or controls directly or  indirectly, may submit to arbitration under 
this Section a claim 
(i) that the respondent has breached 
   (A) an obligation under Section A or Annex 10-F, 
 
   (B) an investment authorization, or     (C) an investment agreement;  
  and 
 
(ii) that the enterprise has incurred loss or damage by reason of, or arising out of, 
that breach. 
2. For greater certainty, a claimant may submit to ar bitration under this Section a claim that the 
respondent has breached an obligation under Sec tion A or Annex 10-F through the actions of a 
designated monopoly or a state enterprise exercisi ng delegated government authority as described in 
Article 16.3(3)(a) (Designated Monopolies) and Artic le 16.4(2) (State Enterprises), respectively. 
3. Without prejudice to Article 12.1(2) (Scope and Coverage), no clai m may be submitted under 
this Section that alleges a violation of any provisi on of this Agreement other than an obligation under 
Section A or Annex 10-F. 
4. At least 90 days before submitting any claim to ar bitration under this Section, a claimant shall 
deliver to the respondent a written notice of its intent ion to submit the claim to arbitration (“notice of 
intent”). The notice shall specify: 
(a) the name and address of the claimant and, where a claim is submitted on behalf of an 
enterprise, the name, address, and place of incorporation of the enterprise; 
(b) for each claim, the provision of this Agreement, investment authorization, or 
investment agreement alleged to have been breached and any other relevant 
provisions; 
(c) the legal and factual basis for each claim; and 
(d) the relief sought and the approximate amount of damages claimed. 
5. Provided that six months have elapsed since the events giving rise to the claim, a claimant 
may submit a claim referred to in paragraph 1: 
(a) under the ICSID Convention, provided that  both the non-disputing Party and the 
respondent are parties to the ICSID Convention; 
(b) under the ICSID Additional Facility Rules,  provided that either the nondisputing 
Party or the respondent, but not both, is a party to the ICSID Convention; 
(c) under the UNCITRAL Arbitration Rules; or 
(d) if the disputing parties agree, to any ot her arbitration institution or under any other 
arbitration rules. WT/REG160/1 
Page 100  
 
6. A claim shall be deemed  submitted to arbitration under this Section when the claimant’s 
notice of or request for arbitration (“notice of arbitration”): 
(a) referred to in paragraph 1 of  Article 36 of the ICSID Convention is received by the 
Secretary-General; 
(b) referred to in Article 2 of Schedule C of  the ICSID Additional Facility Rules is 
received by the Secretary-General; 
(c) referred to in Article 3 of the UNCITRAL Arbitration Rules, together with the 
statement of claim referred to in Article 18 of the UNCITRAL Arbitration Rules, are received by the respondent; or 
(d) referred to under any other arbitral ins titution or arbitral rules selected under 
paragraph 5(d) is received by the respondent. 
7. The arbitration rules applicable under paragraph 5, and in effect on the date the claim or 
claims were submitted to arbitration under this S ection, shall govern the arbitration except to the 
extent modified by this Agreement. 
8. The claimant shall provide with the notice of  arbitration referred to in paragraph 6: 
(a) the name of the arbitrator that the claimant appoints; or 
(b) the claimant’s written consent for the Secr etary-General to appoint the claimant’s 
arbitrator. 
Article 10.16 
 
Consent Of Each Party To Arbitration
 
 
1. Each Party consents to the submission of a claim to arbitration under this Section in 
accordance with this Agreement. 
2. The consent under paragraph 1 and the submission of  a claim to arbitration under this Section 
shall satisfy the requirements of: 
(a) Chapter II of the ICSID Convention (Juris diction of the Centre) and the ICSID 
Additional Facility Rules for written consent of the parties to the dispute; 
(b) Article II of the New York Convention for an “agreement in writing;” and  
(c) Article I of the Inter-American Convention for an “agreement.” 
Article 10.17 
 
Conditions And Limitations On Consent Of Each Party  
 1. No claim may be submitted to arbitration under this Section if more than three years have 
elapsed from the date on which the claimant first acquired, or should have first acquired, knowledge 
of the breach alleged under Article 10.15(1) and k nowledge that the claimant (for claims brought 
under Article 10.15(1)(a)) or the enterprise (for clai ms brought under Article 10.15(1)(b)) has incurred 
loss or damage.  WT/REG160/1 
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2. No claim may be submitted to arb itration under this Section unless: 
(a) the claimant consents in writing to arbitr ation in accordance with the procedures set 
out in this Agreement; and 
(b) the notice of arbitration referred to in Article 10.15(6) is accompanied, 
(i) for claims submitted to arbitrati on under Article 10.15(1)(a), by the 
claimant’s written waiver, and 
(ii) for claims submitted to arbitration under Article 10.15(1)(b), by the 
claimant’s and the enterprise’s written waivers  
of any right to initiate or continue befo re any administrative tribunal or court under 
the law of either Party, or other disput e settlement procedures, any proceeding with 
respect to the events alleged to  give rise to the claimed breach. 
 3. Notwithstanding paragraph 2(b), the claimant (for claims brought under Article 10.15(1)(a)) 
and the claimant or the enterprise (for claims brought under Article 10.15(1)(b)) may initiate or 
continue an action that seeks interim injunctive re lief and does not involve the payment of monetary 
damages before a judicial or administrative tribunal of the respondent, provided that the action is 
brought for the sole purpose of preserving the claimant ’s or the enterprise’s rights and interests during 
the pendency of the arbitration. 
Article 10.18 
 
Selection Of Arbitrators
 
 
1. Unless the disputing parties otherwise agree, the tribunal shall comprise three arbitrators, one 
arbitrator appointed by each of the disputing pa rties and the third, who shall be the presiding 
arbitrator, appointed by agreement of the disputing parties. 
2. The Secretary-General shall serve as appointin g authority for an arbitration under this 
Section. 
3. If a tribunal has not been constituted within 75 da ys from the date that a claim is submitted to 
arbitration under this Section, the Secretary-General,  on the request of a disputing party, shall appoint, 
in his or her discretion, the arbitrator or arbitrators not yet appointed. 
4. For purposes of Article 39 of the ICSID Conventio n and Article 7 of Schedule C to the ICSID 
Additional Facility Rules, and without prejudice to an objection to an arbitrator on a ground other than 
nationality: 
(a) the respondent agrees to the appointment of  each individual member of a tribunal 
established under the ICSID Convention or the ICSID Additional Facility Rules; 
(b) a claimant referred to in Article 10.15(1 )(a) may submit a claim to arbitration under 
this Section, or continue a claim, under the ICSID Convention or the ICSID 
Additional Facility Rules, only on condition that the claimant agrees in writing to the 
appointment of each individual member of the tribunal; and 
(c) a claimant referred to in Article 10.15(1)(b ) may submit a claim to arbitration under 
this Section, or continue a claim, under the ICSID Convention or the ICSID WT/REG160/1 
Page 102  
 
Additional Facility Rules, only on condition that the claimant and the enterprise agree in writing to the appointment of each individual member of the tribunal. 
Article 10.19 
 
Conduct Of The Arbitration
 
 
1. The disputing parties may agree on the legal place of any arbitration under the arbitral rules 
applicable under Article 10.15(5)(b), (c), or (d). If the disputing parties fail to reach agreement, the 
tribunal shall determine the place in accordance with the applicable ar bitral rules, provided that the 
place shall be in the territory of a State th at is a party to the New York Convention. 
2. The non-disputing Party may make oral and writte n submissions to the tribunal regarding the 
interpretation of this Agreement. 
3. The tribunal shall have the authority to accept and consider amicus curiae  submissions from a 
person or entity that is not a disputing party (the  “submitter”). The submissions shall be provided in 
both Spanish and English, and shall identify the subm itter and any Party, other government, person, or 
organization, other than the submitter, that has provided, or will provide, any financial or other 
assistance in preparing the submission. 
4. Without prejudice to a tribunal’s authority to address other objections as a preliminary 
question, such as an objection that a dispute is not  within a tribunal’s competence, a tribunal shall 
address and decide as a preliminary question any obj ection by the respondent that, as a matter of law, 
a claim submitted is not a claim for which an awar d in favor of the claimant may be made under 
Article 10.25. 
(a) Such objection shall be submitted to the tr ibunal as soon as possible after the tribunal 
is constituted, and in no event later than th e date the tribunal fixes for the respondent 
to submit its counter-memorial (or, in th e case of an amendment to the notice of 
arbitration referred to in Article 10.15( 6), the date the tribunal fixes for the 
respondent to submit its response to the amendment). 
(b) On receipt of an objection under this pa ragraph, the tribunal shall suspend any 
proceedings on the merits, establish a schedule for considering the objection consistent with any schedule it has establis hed for considering any other preliminary 
question, and issue a decision or award on the objection, stating the grounds therefore. 
(c) In deciding an objection under this paragra ph, the tribunal shall assume to be true 
claimant’s factual allegations in support of  any claim in the notice of arbitration (or 
any amendment thereof) and, in disput es brought under the UNCITRAL Arbitration 
Rules, the statement of claim referred to in Article 18 of the UNCITRAL Arbitration Rules. The tribunal may also consider any relevant facts not in dispute. 
(d) The respondent does not waive any objection as to competence or any argument on 
the merits merely because the respondent did or did not raise an objection under this 
paragraph or make use of th e expedited procedure set out in the following paragraph. 
5. In the event that the respondent so requests with in 45 days after the tribunal is constituted, the 
tribunal shall decide on an expedited basis an obj ection under paragraph 4 or any objection that the 
dispute is not within the tribunal’s competence. The tribunal shall suspend any proceedings on the 
merits and issue a decision or award on the objection( s), stating the grounds therefor, no later than 150 
days after the date of the request. However, if a disputing party requests a hearing, the tribunal may  WT/REG160/1 
 Page 103 
 
 
take an additional 30 days to issue the decisi on or award. Regardless of whether a hearing is 
requested, a tribunal may, on a showing of extraordinary cause, delay issuing its decision or award by an additional brief period of time, which may not exceed 30 days. 
6. When it decides a respondent’s objection under paragraph 4 or 5, the tribunal may, if 
warranted, award to the prevailing disputing party reasonable costs and attorneys’ fees incurred in 
submitting or opposing the objection. In determining whether such an award is warranted, the tribunal 
shall consider whether either the claimant’s cl aim or the respondent’s objection was frivolous, and 
shall provide the disputing parties a reasonable opportunity to comment. 
7. A respondent may not assert as a defense, count erclaim, right of set-off, or for any other 
reason that the claimant has received or will receive  indemnification or other compensation for all or 
part of the alleged damages pursuant to  an insurance or guarantee contract. 
8. A tribunal may order an interim measure of protection to preserve the rights of a disputing 
party, or to ensure that the tribunal’s jurisdicti on is made fully effective, including an order to 
preserve evidence in the possession or control of a disputing party or to protect the tribunal’s 
jurisdiction. A tribunal may not order attachment or  enjoin the application of a measure alleged to 
constitute a breach referred to in Article 10.15. Fo r purposes of this paragraph, an order includes a 
recommendation. 
9. (a) At the request of a disputing party, a tribunal shall, before issuing an award on 
liability, transmit its proposed award to th e disputing parties and to the non-disputing 
Party. Within 60 days after the tribunal transmits its proposed award, only the disputing parties may submit written comment s to the tribunal concerning any aspect 
of its proposed award. The tribunal shall consider any such comments and issue its 
award not later than 45 days after the expiration of the 60-day comment period. 
(b) Subparagraph (a) shall not apply in any ar bitration for which an appeal has been 
made available pursuant to paragraph 10. 
10. If a separate multilateral agreement enters into fo rce as between the Parties that establishes an 
appellate body for purposes of reviewing awards  rendered by tribunals constituted pursuant to 
international trade or investment agreements to hear  investment disputes, the Parties shall strive to 
reach an agreement that would have such appella te body review awards rendered under Article 10.25 
in arbitrations commenced after the appellate body’s establishment. 
Article 10.20 
 
Transparency Of Arbitral Proceedings
 
 1. Subject to paragraphs 2 and 4, the respondent shall, after receiving the following documents, 
promptly transmit them to the non-disputing Pa rty and make them available to the public: 
(a) the notice of intent referred to in Article 10.15(4); 
(b) the notice of arbitration referred to in Article 10.15(6); 
(c) pleadings, memorials, and briefs submitted to the tribunal by a disputing party and 
any written submissions submitted pursuant to  Article 10.19(2) and (3) and Article 
10.24; 
(d) minutes or transcripts of hearings of the tribunal, where available; and WT/REG160/1 
Page 104  
 
(e) orders, awards, and decisions of the tribunal. 
2. The tribunal shall conduct hearings open to the public and shall determine, in consultation 
with the disputing parties, the appropriate logisti cal arrangements. However, any disputing party that 
intends to use information designated as confiden tial business information or information that is 
privileged or otherwise protected from disclosure under  a Party’s law in a hearing shall so advise the 
tribunal. The tribunal shall make appropriate arrangements to protect  the information from disclosure. 
3. Nothing in this Section requires a respondent to disclose confidential business information or 
information that is privileged or otherwise protected  from disclosure under a Party’s law or to furnish 
or allow access to information that it may with hold in accordance with Article 23.2 (Essential 
Security) or Article 23.5 (Disclosure of Information). 
4. Confidential business information or information that is privileged or otherwise protected 
from disclosure under a Party’s law shall, if such in formation is submitted to th e tribunal, be protected 
from disclosure in accordance with the following procedures:  
(a) Subject to subparagraph (d), neither the disputing parties nor the tribunal shall 
disclose to the non-disputing Party or to the public any confidential business 
information or information that is privil eged or otherwise protected from disclosure 
under a Party’s law where the disputing party that provided the information clearly designates it in accordance with subparagraph (b); 
(b) Any disputing party claiming that certa in information constitutes confidential 
business information or information that is privileged or otherwise protected from disclosure under a Party’s law shall clearly d esignate the information at the time it is 
submitted to the tribunal; 
(c) A disputing party shall, at the same time that it submits a document containing 
information claimed to be confidential bus iness information or information that is 
privileged or otherwise protected from disclosure under a Party’s law, submit a redacted version of the document that do es not contain the information. Only the 
redacted version shall be provided to th e nondisputing Party and made public in 
accordance with paragraph 1; and 
(d) The tribunal shall decide any objection re garding the designation of information 
claimed to be confidential business informati on or information that is privileged or 
otherwise protected from disclosure under a Party’s law. If the tribunal determines that such information was not properly d esignated, the disputing party that submitted 
the information may:  
(i) withdraw all or part of its submissi on containing such information; or  
(ii) agree to resubmit complete and redacted documents with corrected 
designations in accordance with the tribunal’s determination and subparagraph (c). 
In either case, the other disputing party sh all, whenever necessary, resubmit complete 
and redacted documents which either remove the information withdrawn under 
subparagraph (d)(i) by the disputing party that first submitted the information or 
redesignate the information c onsistent with the designati on under subparagraph (d)(ii) 
of the disputing party that first submitted the information. 
  WT/REG160/1 
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5. Nothing in this Section authorizes a responde nt to withhold from the public information 
required to be disclosed by its laws. 
Article 10.21 
 
Governing Law  
 
1. Subject to paragraph 3, when a claim is su bmitted under Article 10.15(1)(a)(i)(A) or Article 
10.15(1)(b)(i)(A), the tribunal sha ll decide the issues in dispute in accordance with this Agreement 
and applicable rules of international law. 
2. Subject to paragraph 3, when a claim is submitted under Article 10.15(1)(a)(i)(B) or (C), or 
Article 10.15(1)(b)(i)(B) or (C), the tribunal shall deci de the issues in dispute in accordance with the 
rules of law specified in the pertinent investment agreement or investment authorization, or as the 
disputing parties may otherwise agree. If the rules of  law have not been specified or otherwise agreed, 
the tribunal shall apply the law of the respondent (incl uding its rules on the conflict of laws), the terms 
of the investment agreement or investment authori zation, such rules of international law as may be 
applicable, and this Agreement. 
3. A decision of the Commission declaring its inte rpretation of a provision of this Agreement 
under Article 21.1 (Free Trade Commission) shall be binding on a tribunal established under this Section, and any award must be consistent with that decision. 
Article 10.22 
 
Interpretation Of Annexes
 
 1. Where a respondent asserts as a defense that the me asure alleged to be a breach is within the 
scope of a non-conforming measure set out in Annex I or Annex II, the tribunal shall, on request of 
the respondent, request the interpretation of the Commission on the issue. The Commission shall 
submit in writing any decision declaring its in terpretation under Article 21.1 (Free Trade 
Commission) to the tribunal within 60 days of delivery of the request. 
2. A decision issued by the Commission under paragraph 1 shall be binding on the tribunal, and 
any award must be consistent with that decision.  If the Commission fails to issue such a decision 
within 60 days, the tribunal shall decide the issue. 
Article 10.23 
 
Expert Reports
 
  Without prejudice to the appointment of other kinds of experts where authorized by the applicable arbitration rules, a tribunal, at the request of a disputing party or, unless the disputing 
parties disapprove, on its own initiative, may appoint one  or more experts to report to it in writing on 
any factual issue concerning envir onmental, health, safety, or other scientific matters raised by a 
disputing party in a proceeding, subject to such  terms and conditions as the disputing parties may 
agree.  
Article 10.24 
 
Consolidation
 
 1. Where two or more claims have been subm itted separately to arbitration under Article 
10.15(1) and the claims have a question of law or f act in common and arise out of the same events or WT/REG160/1 
Page 106  
 
circumstances, any disputing party may seek a cons olidation order in accord ance with the agreement 
of all the disputing parties sought to be covered by the order or the terms of paragraphs 2 through 10. 
2. A disputing party that seeks a consolidation order under this Article shall deliver, in writing, a 
request to the Secretary-General and to all the dis puting parties sought to be covered by the order and 
shall specify in the request: 
(a) the names and addresses of all the disputing pa rties sought to be covered by the order; 
(b) the nature of the order sought; and 
(c) the grounds on which the order is sought. 
3. Unless the Secretary-General finds within 30 da ys after receiving a request under paragraph 2 
that the  request is manifestly unfounded, a tribunal shall be established under this Article. 
4. Unless all the disputing parties sought to be c overed by the order otherwise agree, a tribunal 
established under this Article sha ll comprise three arbitrators: 
(a) one arbitrator appointed by agreement of the claimants; 
(b) one arbitrator appointed by the respondent; and 
(c) the presiding arbitrator appointed by the S ecretary-General, provided, however, that 
the presiding arbitrator shall not be a national of either Party. 
5. If, within 60 days after the Secretary-Genera l receives a request made under paragraph 2, the 
respondent fails or the claimants fail to appoint an  arbitrator in accordance with paragraph 4, the 
Secretary-General, on the request of any disputing party sought to be covered by the order, shall 
appoint the arbitrator or arbitrators not yet appointe d. If the respondent fails to appoint an arbitrator, 
the Secretary-General shall appoint a national of the respondent, and if the claimants fail to appoint an 
arbitrator, the Secretary-General shall appoint a national of the non-disputing Party. 
6. Where a tribunal established under this Article is sat isfied that two or more claims that have 
been submitted to arbitration under Article 10.15(1)  have a question of law or fact in common, and 
arise out of the same events or circumstances, the tr ibunal may, in the interest of fair and efficient 
resolution of the claims, and after hearing the disputing parties, by order: 
(a) assume jurisdiction over, and hear and determine together, all or part of the claims; 
(b) assume jurisdiction over, and hear and determine one or more of the claims, the 
determination of which it believes would assist in the resolution of the others; or 
(c) instruct a tribunal previously established un der Article 10.18 to assume jurisdiction 
over, and hear and determine together, a ll or part of the claims, provided that 
(i) that tribunal, at the request of any cl aimant not previously a disputing party 
before that tribunal, shall be reconstitu ted with its original members, except 
that the arbitrator for the claimants sh all be appointed pursuant to paragraphs 
4(a) and 5; and 
(ii) that tribunal shall decide whether any prior hearing shall be repeated.   WT/REG160/1 
 Page 107 
 
 
7. Where a tribunal has been established under this Article, a claimant th at has submitted a claim 
to arbitration under Article 10.15(1) and that has not  been named in a request made under paragraph 2 
may make a written request to the tribunal that it be included in any order made under paragraph 6, 
and shall specify in the request:  
(a) the name and address of the claimant; 
(b) the nature of the order sought; and 
(c) the grounds on which the order is sought. 
The claimant shall deliver a copy of its  request to the Secretary-General. 
 8. A tribunal established under this Article shall conduct its proceedings in accordance with the 
UNCITRAL Arbitration Rules, except as modified by this Section. 
9. A tribunal established under Article 10.18 shall not have jurisdiction to decide a claim, or a 
part of a claim, over which a tribunal establishe d or instructed under this Article has assumed 
jurisdiction. 
10. On application of a disputing party, a tri bunal established under this Article, pending its 
decision under paragraph 6, may order that the pr oceedings of a tribunal established under Article 
10.18 be stayed, unless the latter tribunal has already adjourned its proceedings. 
Article 10.25 
 
Awards
 
 
1. Where a tribunal makes a final award against a respondent, the tribunal may award, separately 
or in combination, only: 
(a) monetary damages and any applicable interest; 
(b) restitution of property, in which case the aw ard shall provide that the respondent may 
pay monetary damages and any applicab le interest in lieu of restitution. 
A tribunal may also award costs and attorneys’ fees in accordance with this Section and the applicable 
arbitration rules.  2. Subject to paragraph 1, where a claim is subm itted to arbitration under Article 10.15(1)(b): 
(a) an award of restitution of property shall provide that restitution be made to the 
enterprise; 
(b) an award of monetary damages and any applicable interest shall provide that the sum 
be paid to the enterprise; and 
(c) the award shall provide that it is made without prejudice to any right that any person 
may have in the relief under applicable domestic law. 
3. A tribunal may not award punitive damages. 
4. An award made by a tribunal shall have no binding force except between the disputing parties 
and in respect of the particular case. WT/REG160/1 
Page 108  
 
5. Subject to paragraph 6 and the applicable review  procedure for an interim award, a disputing 
party shall abide by and comply with an award without delay. 
6. A disputing party may not seek enforcement of a final award until: 
(a) in the case of a final award made under the ICSID Convention 
(i) 120 days have elapsed from the date th e award was rendered and no disputing 
party has requested revision or annulment of the award; or 
(ii) revision or annulment proceedings have been completed; and  
(b) in the case of a final award under the ICSID Additional Facility Rules, the 
UNCITRAL Arbitration Rules, or the rules selected pursuant to Article 10.15(5)(d) 
(i) 90 days have elapsed from the date th e award was rendered and no disputing 
party has commenced a proceeding to revise, set aside, or annul the award, or 
(ii) a court has dismissed or allowed an application to revise, set aside, or annul 
the award and there is no further appeal. 
7. Each Party shall provide for the enfor cement of an award in its territory. 
8. If the respondent fails to abide by or comply with a final award, on delivery of a request by 
the non-disputing Party, a panel shall be establis hed under Article 22.6 (Request for an Arbitral 
Panel). The requesting Party may seek in such proceedings:  
(a) a determination that the failure to abide by or comply with the final award is 
inconsistent with the obliga tions of this Agreement; and 
(b) if the Parties agree, a recommendation that the respondent abide by or comply with 
the final award. 
9. A disputing party may seek enforcement of an arbitration award under the ICSID Convention, 
the New York Convention, or the Inter-American Convention regardless of whether proceedings have 
been taken under paragraph 8. 
10. A claim that is submitted to arbitration under this Section shall be considered to arise out of a 
commercial relationship or transaction for purposes of Article I of the New York Convention and 
Article I of the Inter-American Convention. 
Article 10.26 
 
Service Of Documents
 
  Delivery of notice and other documents on a Part y shall be made to the place named for that 
Party in Annex 10-G. 
  WT/REG160/1 
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Section C - Definitions  
 
Article 10.27 
 
Definitions  
 
 For purposes of this Chapter:   Centre  means the International Centre for Settlement of Investment Disputes (ICSID) 
established by the ICSID Convention; 
 
 claimant  means an investor of a Party that is a pa rty to an investment dispute with the other 
Party;   disputing parties means the claimant and the respondent; 
 
 disputing party  means either the claimant or the respondent; 
   enterprise  means an “enterprise” as defined in  Article 2.1 (Definitions of General 
Application), and a branch of an enterprise;  
 enterprise of a Party  means an enterprise constituted or organized under the law of a Party, 
and a branch located in the territory of a Pa rty and carrying out business activities there;  
  freely usable currency means “freely usable currency” as determined by the International 
Monetary Fund under its Articles of Agreement ; 
 
 ICSID Additional Facility Rules  means the Rules Governing the Additional Facility for the 
Administration of Proceedings by the Secretariat of the International Centre for Settlement of 
Investment Disputes ; 
  ICSID Convention  means the Convention on the Settleme nt of Investment Disputes between 
States and Nationals of other States, done at Washington, March 18, 1965;  
  Inter-American Convention  means the Inter-American C onvention on International 
Commercial Arbitration, done at Panama, January 30, 1975;  
 investment means every asset that an investor owns or  controls, directly or indirectly, that 
has the characteristics of an investment, including  such characteristics as the commitment of capital or 
other resources, the expectation of gain or profit, or the assumption of risk. Forms that an investment 
may take include:  
(a) an enterprise; 
(b) shares, stock, and other forms of equ ity participation in an enterprise; 
(c) bonds, debentures, loans, and other debt instruments;
10 
(d) futures, options, and other derivatives; 
                                                      
10 Some forms of debt, such as bonds, debentures, and long-term notes, are more likely to have the 
characteristics of an investment, while other forms of debt , such as claims to paymen t that are immediately due 
and result from the sale of goods or services, are less likely to have such characteristics. WT/REG160/1 
Page 110  
 
(e) rights under contract, including turnkey, construction, management, production, 
concession, or revenue-sharing contracts; 
(f) intellectual property rights; 
(g) rights conferred pursuant to domestic law, such as concessions, licenses, 
authorizations, and permits;
11 and 
(h) other tangible or intangible, movable or immovable property, and related property 
rights, such as leases, mortgages, liens, and pledges; 
but investment does not mean an order or judgment  entered in a judicial or administrative action; 
  investment agreement  means a written agreement
12 that takes effect at least two years after 
the date of entry into force of this Agreement between a national authority13 of a Party and a covered 
investment or an investor of the other Party:  
(a) that grants rights with respect to natu ral resources or other assets that a national 
authority controls; and 
(b) that the covered investment or the investor relies on in establishing or acquiring a 
covered investment; 
 investment authorization means an authorization that the foreign investment authority of a 
Party grants to a covered investment or an investor of the other Party;
14 
  investor of a non-Party  means, with respect to a Party, an investor that attempts to make, is 
making, or has made an investment in the territory of th at Party, that is not an investor of either Party; 
  investor of a Party  means a Party or state enterprise ther eof, or a national or an enterprise of 
a Party, that attempts to make, is making, or has made  an investment in the territory of the other Party; 
provided, however, that a natural person who is a dua l national shall be deemed  to be exclusively a 
national of the State of his/her dominant and effective nationality; 
  monopoly  means “monopoly” as defined in Article 16.9 (Definitions); 
  New York Convention  means the United Nations Convention on the Recognition and 
Enforcement of Foreign Arbitral Awards , done at New York, June 10, 1958; 
 
 non-disputing Party  means the Party that is not a party to an investment dispute;  
                                                     
 
11 Whether a particular right conferred pursuant to domestic law, as referred to in paragraph (g), has the 
characteristics of an investment depends on such factors as the nature and extent of the rights that the holder has 
under the domestic law of the Party. Among such rights that do not have the characteristics of an investment are those that do not create any rights prot ected under domestic law. For greater certainty, the foregoing is without 
prejudice to whether any asset associated with such  right has the characteristics of an investment. 
12 For purposes of this definition, “written agreem ent” means an agreement in writing, executed and 
entered into by both parties or their representatives, whic h sets forth an exchange of rights and obligations, for 
value. Neither a unilateral act of an administrative or judi cial authority, such as a decr ee, order, or judgment, nor 
a consent decree, shall be considered a written agreement. 
13 For purposes of this definition, “national authority” means (a) for the United States, an authority at 
the central level of government; and (b) for Chile, an authority at the ministerial level of government. "National authority” does not incl ude state enterprises. 
14 The Parties recognize that neither Party has a foreign investment authority, as of the date this 
Agreement enters into force.  WT/REG160/1 
 Page 111 
 
 
 respondent  means the Party that is a part y to an investment dispute; 
  Secretary-General  means the Secretary-General of ICSID; 
  tribunal  means an arbitration tribunal establis hed under Article 10.18 or 10.24; and 
  
 UNCITRAL Arbitration Rules means the arbitration rules of the United Nations 
Commission on International Trade Law.   
ANNEX 10-A 
 
Customary International Law
 
  The Parties confirm their shared understanding that “customary international law” generally 
and as specifically referenced in Articles 10.4 and 10 .9 results from a general and consistent practice 
of States that they follow from a sense of legal oblig ation. With regard to Article 10.4, the customary 
international law minimum standard of treatment of aliens refers to all cu stomary international law 
principles that protect the economic rights and interests of aliens.   
ANNEX 10-B 
 
Public Debt
 
 
Chile 
 
 The rescheduling of the debts of Chile, or of its appropriate institutions owned or controlled 
through ownership interests by Chile, owed to th e United States and the rescheduling of its debts 
owed to creditors in general are not subject to an y provision of Section A other than Articles 10.2 and 
10.3.  
 
ANNEX 10-C 
 
Special Dispute Settlement Provisions
 
 
Chile 
 
1. Where a claimant submits a claim alleging th at Chile has breached an obligation under 
Section A, other than Article 10.3, that arises fro m its imposition of restrictive measures with regard 
to payments and transfers, Section B shall apply except as modified below: 
(a) A claimant may submit any such claim only after one year has elapsed since the 
events giving rise to the claim; 
(b) If the claim is submitted under Article 10.15(1)(b ), the claimant may, on behalf of the 
enterprise, only seek damages with respect to the shares of the enterprise for which 
the claimant has a beneficial interest; 
(c) Loss or damages arising from restrictive measures on capital inflows shall be limited 
to the reduction in value of the transfers a nd shall exclude loss of profits or business 
and any similar consequential or incidental damages; WT/REG160/1 
Page 112  
 
(d) Paragraph 1(a) shall not apply to claims that arise from restrictions on:  
(i) transfers of proceeds of foreign direct investment by investors of the United 
States, excluding external debt financi ng covered in subpara graph (d)(ii), and 
excluding investments designed with the purpose of gaining direct or indirect access to the financial market; or  
(ii) payments pursuant to a loan or bond issued in a foreign market, including 
inter- and intra-company debt financin g between affiliated enterprises made 
exclusively for the conduct, operation, management, or expansion of such affiliated enterprises, provided that th ese payments are made in accordance 
with the maturity date agreed on in the loan or bond agreement; 
(e) Excluding restrictive measures referred to in paragraph 1(d), Chile shall incur no 
liability, and shall not be subject to claims , for damages arising from its imposition of 
restrictive measures with regard to payments  and transfers that were incurred within 
one year from the date on which the restri ctions were imposed, provided that such 
restrictive measures do not substantially impede transfers; 
(f) A restrictive measure of Chile with regard to payments and transfers that is consistent 
with this Annex shall be deemed not to contravene Article 10.2 provided that, as 
required under existing Chilean law, it does not discriminate among investors that 
enter into transactions of the same nature; and  
(g) Claims arising from Chile’s imposition of restrictive measures with regard to 
payments and transfers shall not be subj ect to Article 10.24 unless Chile consents. 
2. The United States may not request the establishment of an arbitral panel under Chapter 
Twenty-Two (Dispute Settlement) relating to Chile’s imposition of restrictive measures with regard to 
payments and transfers until one year has elapsed  since the events giving rise to the dispute. 
3. Restrictive measures on payments and transfer s related to claims under this Annex shall 
otherwise be subject to applicable domestic law. 
 
ANNEX 10-D 
 
Expropriation
 
  The Parties confirm their shared understanding that: 
 
1. Article 10.9(1) is intended to reflect customar y international law concerning the obligation of 
States with respect to expropriation. 
2. An action or a series of actions by a Pa rty cannot constitute an expropriation unless it 
interferes with a tangible or intangible property right or property interest in an investment. 
3. Article 10.9(1) addresses two situations. The first is direct expropriation, where an investment 
is nationalized or otherwise directly expropriated through formal transfer of title or outright seizure. 
4. The second situation addressed by Article 10.9(1) is  indirect expropriation, where an action or 
series of actions by a Party has an effect equivalent to direct expropriation without formal transfer of  
title or outright seizure.  WT/REG160/1 
 Page 113 
 
 
(a) The determination of whether an action or series of actions by a Party, in a specific 
fact situation, constitutes an indirect ex propriation, requires a caseby-case, fact-based 
inquiry that considers, among other factors: 
(i) the economic impact of the government action, although the fact that an 
action or series of actions by a Party has an adverse effect on the economic 
value of an investment, standing alone,  does not establish that an indirect 
expropriation has occurred; 
(ii) the extent to which the government acti on interferes with distinct, reasonable 
investment-backed expectations; and  
(iii) the character of the government action. 
(b) Except in rare circumstances, nondiscriminator y regulatory actions by a Party that are 
designed and applied to protect legitimate  public welfare objectives, such as public 
health, safety, and the environment, do not constitute indirect expropriations. 
 
ANNEX 10-E 
 
Submission Of A Claim To Arbitration  
 
Chile 
 
1. An investor of the United States may not submit to arbitration under Section B: 
(a) a claim that Chile has breached an obligation under Section A or Annex 10-F either: 
(i) on its own behalf under Ar ticle 10.15(1)(a), or 
(ii) on behalf of an enterprise of Chile that is a juridical person that the investor 
owns or controls directly or i ndirectly under Article 10.15(1)(b), 
if the investor or the enterp rise, respectively, has alleged that breach of an obligation 
under Section A or Annex 10-F in proceedi ngs before a court or administrative 
tribunal of Chile; or  
(b) a claim that Chile has breached an investme nt agreement or investment authorization 
either: 
(i) on its own behalf under Ar ticle 10.15(1)(a), or 
(ii) on behalf of an enterprise of Chile that is a juridical person that the investor 
owns or controls directly or indi rectly under Article 10.15(1)(b),  
if the investor or the enterprise, respectivel y, has alleged that breach of an investment 
agreement or investment authorization in pr oceedings before a court or administrative 
tribunal of Chile. 
 
2. For greater certainty, if an investor of the United States elects to submit a claim of the type 
described in this Annex to a court or administrativ e tribunal of Chile, that election shall be definitive 
and the investor may not thereafter submit th e claim to arbitration under Section B. WT/REG160/1 
Page 114  
 
ANNEX 10-F 
 
DL 600
 
 
Chile 
 
1. Without prejudice to paragraphs 3 through 7, Chile  shall accord to an investor of the United 
States or to a covered investment that is  a party to an investment contract under Estatuto de la  
Inversión Extranjera, Decreto Ley 600 de 1974  (DL 600) the better of the treatment required under 
this Agreement or the treatment under the investment contract. 
2. Without prejudice to paragraphs 3 through 7, Chile shall permit an investor of the United 
States or a covered investment that has entered into  an investment contract under DL 600 to amend 
the investment contract to make it consistent with Chile’s obligations  under this Agreement. 
3. Subject to paragraph 4, when an investor of  the United States or a covered investment has 
entered into an investment contract under DL 600, an  investor, on its own behalf or on behalf of the 
investment, may only submit a claim against Chile under Section B with regard to the contract if the 
investor alleges that Chile h as breached an obligation under: 
(a) Section A in connection with the investment contract; or 
(b) this Annex; 
provided, however, that such an investor may not submit any claim under Section B on the basis of 
the equity/debt ratio requirement of an investment  contract under DL 600 except for claims that Chile 
has accorded the investor or its covered investme nt treatment less favorable than Chile accords under 
DL 600 to an investor of a non-Party or its investment in like circumstances.  4. When an investor of the United States or a covered investment has entered into an investment 
contract under DL 600, and the investor, on its own beha lf or on behalf of the investment, claims that 
Chile has breached the tax provisions of that contract , it shall, with regard to that claim, only have 
recourse to the dispute settlement provisions of th e investment contract or the dispute settlement 
provisions of this Agreement re levant to taxation measures. 
5. For greater certainty, execution of an investment  contract under DL 600 by an investor of the 
United States or a covered investment does not create any right on the part of the investor or covered 
investment to engage in particular activities in Chile. 
6. Nothing in this Agreement shall limit the right of Chile’s Comite de Inversiones Extranjeras , 
its Vicepresidencia Ejecutiva , or their successors to decide whethe r to authorize an investor of the 
United States or a covered investment to enter in to an investment contract under DL 600, or to 
establish conditions in such contract, provided that Ch ile does so in a manner that is not inconsistent 
with Chile’s obligations under Section A. 
7. Notwithstanding any other provision in this Agreem ent, Chile may prohibit an investor of the 
United States or a covered investment from transfe rring from Chile proceeds of the sale of all or any 
part of an investment made pursuant to a contract  under DL 600 for up to one year after the date that 
the investor or covered investment transferre d funds to Chile to establish the investment.  WT/REG160/1 
 Page 115 
 
 
ANNEX 10-G 
 
Service Of Documents On A Party Under Section B  
 
Chile 
 
 Notices and other documents in disputes under S ection B shall be served on Chile by delivery 
to:  
 Dirección de Asuntos Jurídicos del Ministerio de Relaciones 
 Exteriores de la República de Chile  Morandé 441 
 Santiago, Chile  
United States 
 
 Notices and other documents in disputes under S ection B shall be served on the United States 
by delivery to:   Executive Director (L/EX)  Office of the Legal Adviser 
 Department of State 
 Washington, D.C. 20520  United States of America   
ANNEX 10-H 
 
Possibility Of A Bilateral Appellate Body/Mechanism
 
  Within three years after the date of entry in to force of this Agreement, the Parties shall 
consider whether to establish a bilateral appellate  body or similar mechanism to review awards 
rendered under Article 10.25 in arbitrations comme nced after they establish the appellate body or 
similar mechanism.   
CHAPTER ELEVEN : CROSS-BORDER TRADE IN SERVICES 
 
Article 11.1 
 
Scope And Coverage
 
 1. This Chapter applies to measures adopted or maintained by a Party affecting cross-border 
trade in services by service suppliers of the other Party. Such measures include measures affecting: 
(a) the production, distribution, marketing, sale, and delivery of a service; 
(b) the purchase or use of, or payment for, a service; 
(c) the access to and use of distribution, trans port, or telecommunications networks and 
services in connection with the supply of a service; 
(d) the presence in its territory of a service supplier of the other Party; and  WT/REG160/1 
Page 116  
 
(e) the provision of a bond or other form of financial security as a condition for the 
supply of a service. 
2. For purposes of this Chapter, “measures adopted  or maintained by a Party” means measures 
adopted or maintained by: 
(a) central, regional, or local governments and authorities; and 
(b) non-governmental bodies in the exercise of powers delegated by central, regional, or 
local governments or authorities. 
3. Articles 11.4, 11.7, and 11.8 also apply to me asures by a Party affecting the supply of a 
service in its territory by an investor of the othe r Party as defined in Article 10.27 (Definitions) or a 
covered investment.
1 
4. This Chapter does not apply to: 
(a) financial services, as defined in Article 12.19 (Definitions), except as provided in 
paragraph 3; 
(b) air services, including domestic and international air transportation services, whether 
scheduled or non-scheduled, and related services in support of air services, other 
than: 
(i) aircraft repair and maintenance services during which an aircraft is 
withdrawn from service, and 
(ii) specialty air services; 
(c) procurement; or 
(d) subsidies or grants provided by a Party or a state enterprise, including government-
supported loans, guarantees, and insurance. 
5. This Chapter does not impose any obligation on a Party with respect to a national of the other 
Party seeking access to its employment market, or empl oyed on a permanent basis in its territory, and 
does not confer any right on that national with respect to that access or employment. 
6. This Chapter does not apply to services supplied in the exercise of governmental authority. A 
“service supplied in the exercise of governmental authority” means any service which is supplied 
neither on a commercial basis, nor in comp etition with one or more service suppliers. 
Article 11.2 
 
National Treatment  
 
1. Each Party shall accord to service suppliers2 of the other Party treatment no less favorable 
than that it accords, in like circumst ances, to its own service suppliers. 
                                                      
1 The Parties understand that nothing in this Chapter,  including this paragraph, is subject to investor-
state dispute settlement pursuant to Section B of Chapter Ten (Investment). 
2 The Parties understand that “service suppliers” has the same meaning as “services and service  
suppliers” in Article XVII:1 of GATS.  WT/REG160/1 
 Page 117 
 
 
2. The treatment to be accorded by a Party under paragraph 1 means, with respect to a regional 
level of government, treatment no less favorable than  the most favorable treat ment accorded, in like 
circumstances, by that regional level of government to service suppliers of the Party of which it forms 
a part. 
Article 11.3 
 
Most-Favored-Nation Treatment  
  Each Party shall accord to service suppliers
3 of the other Party treatment no less favorable 
than that it accords, in like circumstance s, to service suppliers of a non-Party. 
 
Article 11.4 
 
Market Access  
 
 Neither Party may, either on the basis of a re gional subdivision or on the basis of its entire 
territory, adopt or maintain measures that:  
(a) impose limitations on: 
(i) the number of service suppliers,
4 whether in the form of numerical quotas, 
monopolies, exclusive service suppliers, or the requirement of an economic 
needs test,  
(ii) the total value of service transactions or assets in the form of numerical 
quotas or the requirement of an economic needs test,  
(iii) the total number of service operations or on the total quantity of services 
output expressed in terms of designated numerical units in the form of quotas 
or the requirement of an economic needs test,5 or 
(iv) the total number of natural persons that  may be employed in a particular 
service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of a numerical quotas or the requirement of an economic needs test; or  
(b) restrict or require specific types of legal entity or joint venture through which a 
service supplier may supply a service. 
Article 11.5 
 
Local Presence
 
 
 Neither Party may require a service supplier of  the other Party to establish or maintain a 
representative office or any form of enterprise, or to  be resident, in its territory as a condition for the 
cross-border supply of a service.  
                                                     
 
3 The Parties understand that “service suppliers” has the same meaning as “services and service  
suppliers” in Article II:1 of GATS. 
4 The Parties understand that “service suppliers” has the same meaning as “service and service  
suppliers” in Article XVI of GATS. 
5 This clause does not cover measures of a Party which limit inputs for the supply of services.  WT/REG160/1 
Page 118  
 
Article 11.6 
 
Non-Conforming Measures
 
 1. Articles 11.2, 11.3, 11.4, and 11.5 do not apply to: 
(a) any existing non-conforming measure that  is maintained by a Party at: 
(i) the central level of government, as set out by that Party in its Schedule to 
Annex I, 
(ii) a regional level of government, as set out  by that Party in its Schedule to 
Annex I, or 
(iii) a local level of government; 
(b) the continuation or prompt renewal of an y non-conforming measure referred to in 
subparagraph (a); or 
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the 
extent that the amendment does not decr ease the conformity of the measure, as it 
existed immediately before the amendment, with Articles 11.2, 11.3 , 11.4, or 11.5. 
2. Articles 11.2, 11.3, 11.4, and 11.5 do not apply to any measure that a Party adopts or 
maintains with respect to sectors, sub-sectors, or  activities, as set out in its Schedule to Annex II. 
3. Annex 11.6 sets out specific commitments by the Parties. 
Article 11.7 
 
Transparency In Development And Application Of Regulations
6 
  Further to Chapter Twenty (Transparency):  
(a) each Party shall maintain or establish a ppropriate mechanisms for responding to 
inquiries from interested persons regarding their regulations relating to the subject 
matter of this Chapter;
7 
(b) at the time it adopts final regulations relati ng to the subject matter of this Chapter, 
each Party shall, to the extent possible, including upon request, address in writing substantive comments received from interested  persons with respect to the proposed 
regulations; and 
(c) to the extent possible, each Party shall allow a reasonable period of time between 
publication of final regulations  and their effective date.  
 
  
 
                                                     
 
6 For greater certainty, “regula tions” includes regulations establishing or applying to licensing 
authorization or criteria. 
7 Chile’s implementation of its obligation to establish appropriate mechanisms for small administrative 
agencies may need to take into accou nt resource and budget constraints.  WT/REG160/1 
 Page 119 
 
 
Article 11.8 
 
Domestic Regulation  
 1. Where a Party requires authorization for the s upply of a service, the competent authorities of 
that Party shall, within a reasonable period of time after the submission of an application considered 
complete under domestic laws and regulations, inform the applican t of the decision concerning the 
application. At the request of the applicant, th e competent authorities of the Party shall provide, 
without undue delay, information concerning the stat us of the application. This obligation shall not 
apply to authorization requirements that are within the scope of Article 11.6(2). 
2. With a view to ensuring that measures relating to qualification requirements and procedures, 
technical standards, and licensing requirements do not constitute unnecessary barriers to trade in 
services, each Party shall endeavor to ensure, as appropriate for individual sectors, that any such 
measures that it adopts or maintains are: 
(a) based on objective and transparent criteria, such as competence and the ability to 
supply the service; 
(b) not more burdensome than necessary to en sure the quality of the service; and 
(c) in the case of licensing procedures, not in th emselves a restriction on the supply of 
the service. 
3. If the results of the negotiations related to Artic le VI:4 of GATS (or the results of any similar 
negotiations undertaken in other multila teral fora in which both Parties participate) enter into effect, 
this Article shall be amended, as appropriate, afte r consultations between the Parties, to bring those 
results into effect under this Agreement. The Part ies agree to coordinate on such negotiations as 
appropriate. 
Article 11.9 
 
Mutual Recognition
 
 1. For the purposes of the fulfillment, in whole or in part, of its standards or criteria for the 
authorization, licensing, or certification of servi ces suppliers, and subject to the requirements of 
paragraph 4, a Party may recognize the education or experience obtained, requirements met, or 
licenses or certifications granted in a particular  country. Such recognition, which may be achieved 
through harmonization or otherwise, may be based  upon an agreement or arrangement with the 
country concerned or may be accorded autonomously. 
2. Where a Party recognizes, autonomously or by agreement or arrangement, the education or 
experience obtained, requirements met, or licenses or  certifications granted in the territory of a non-
Party, nothing in Article 11.3 shall be construed to  require the Party to accord such recognition to the 
education or experience obtained, requirements me t, or licenses or certifications granted in the 
territory of the other Party. 
3. A Party that is a party to an agreement or arra ngement of the type referred to in paragraph 1, 
whether existing or future, shall afford adequate oppor tunity for the other Party, if the other Party is 
interested, to negotiate its accession to such an agr eement or arrangement or to negotiate comparable 
ones with it. Where a Party accords recognition auto nomously, it shall afford adequate opportunity for 
the other Party to demonstrate that education, experience, licenses, or certifications obtained or 
requirements met in that other Party’s territory should be recognized. WT/REG160/1 
Page 120  
 
4. A Party shall not accord recognition in a manner which would constitute a means of 
discrimination between countries in the application of  its standards or criteria for the authorization, 
licensing, or certification of services suppliers, or a disguised restriction on trade in services. 
5. Annex 11.9 applies to measures adopted or mainta ined by a Party relating to the licensing or 
certification of professional service suppliers as set out in the provisions of that Annex. 
Article 11.10 
 
Implementation
 
  The Parties shall consult annually, or as othe rwise agreed, to review  the implementation of 
this Chapter and consider other trade in services issues of mutual interest. Among other issues, the 
Parties will consult with a view to determining th e feasibility of removing any remaining citizenship 
or permanent residency requirement for the licen sing or certification of each other’s services 
suppliers. Such consultations will also include consideration of the development of procedures that 
could contribute to greater transparency of  measures described in Article 11.6(1)(c). 
 
Article 11.11 
 
Denial Of Benefits
 
 1. A Party may deny the benefits of this Chapter to a service supplier of the other Party if the 
service is being supplied by an enterprise owned or  controlled by nationals of a non-Party, and the 
denying Party: 
(a) does not maintain diplomatic relations with the non-Party; or 
(b) adopts or maintains measures with respect to the non-Party that prohibit transactions 
with the enterprise or that would be violated  or circumvented if the benefits of this 
Chapter were accorded to the enterprise. 
2. Subject to Article 22.4 (Consultations), a Party may deny the benefits of this Chapter to: 
(a) service suppliers of the other Party wher e the service is being supplied by an 
enterprise that is owned or controlled by persons of a non-Party and the enterprise has 
no substantial business activities in the territory of the other Party, or 
(b) service suppliers of the other Party wher e the service is being supplied by an 
enterprise that is owned or controlled by  persons of the denying Party and the 
enterprise has no substantial business activities in the territory of the other Party. 
Article 11.12 
 
Definitions
 
 
 For purposes of this Chapter:   cross-border trade in services or cross-border supply of services  means the supply of a 
service:  
(a) from the territory of one Party into the territory of the other Party; 
(b) in the territory of one Party by a person of that Party to a person of the other Party; or  WT/REG160/1 
 Page 121 
 
 
(c) by a national of a Party in the territory of the other Party,  
but does not include the supply of a service in the territo ry of a Party by an investor of the other Party 
as defined in Article 10.27 (Investment-D efinitions) or a covered investment;  
  enterprise  means an “enterprise” as defined in  Article 2.1 (Definitions of General 
Application), and a branch of an enterprise; 
  enterprise of a Party  means an enterprise constituted or organized under the law of a Party, 
and a branch located in the territory of a Party and carrying out business activities there; 
 
 professional services  means services, the provision of which requires specialized post-
secondary education, or equivalent training or e xperience, and for which the right to practice is 
granted or restricted by a Party, but does not incl ude services provided by trades-persons or vessel and 
aircraft crew members;  
 service supplier of a Party  means a person of a Party that seeks to supply or supplies a 
service; and   specialty air services  means any non-transportation air servi ces, such as aerial fire-fighting, 
sightseeing, spraying, surveying, mapping, photog raphy, parachute jumping, glider towing, and 
helicopter-lift for logging and constr uction, and other airborne agricultural, industrial, and inspection 
services. 
  
ANNEX 11.6 
 
Express Delivery
 
 1. The Parties affirm that measures affecting express delivery services are subject to the 
provisions of this Agreement. 
2. For purposes of this Agreement, express delivery services shall be defined as the expedited 
collection, transport, delivery, tracking, and mainta ining control of documents, printed matter, parcels, 
and/or other goods throughout the supply of the service. 
3. The Parties express their desire to maintain the level of open market access existing on the 
date this Agreement is signed. 
4. Chile agrees that it will not impose any restri ctions on express delivery services which are not 
in existence on the date this Agreement is signed. Chile confirms that it has no intention to direct 
revenues from its postal monopoly to benefit expr ess delivery services as defined in paragraph 2. 
 WT/REG160/1 
Page 122  
 
ANNEX 11.9 
 
Professional Services
 
 
Section A - General Provisions  
 
Development Of Professional Standards 
 
1. The Parties shall encourage the relevant bodi es in their respective territories to develop 
mutually acceptable standards and criteria for licensing and certification of professional service 
providers and to provide recommendations on mutual recognition to the Commission. 
2. The standards and criteria referred to in paragr aph 1 may be developed with regard to the 
following matters: 
(a) education - accreditation of schools or academic programs; 
(b) examinations - qualifying examinations fo r licensing, including alternative methods 
of assessment such as oral examinations and interviews; 
(c) experience - length and nature of experience required for licensing; 
(d) conduct and ethics - standards of professiona l conduct and the nature of disciplinary 
action for non-conformity with those standards; 
(e) professional development and re-certifica tion - continuing education and ongoing 
requirements to maintain professional certification; 
(f) scope of practice - extent of, or limitations on, permissible activities; 
(g) local knowledge - requirements for knowle dge of such matters as local laws, 
regulations, language, geogra phy, or climate; and 
(h) consumer protection - alternatives to r esidency requirements, including bonding, 
professional liability insurance, and client  restitution funds, to provide for the 
protection of consumers. 
3. On receipt of a recommendation referred to in paragraph 1, the Commission shall review the 
recommendation within a reasonable time to determine whether it is consistent  with this Agreement. 
Based on the Commission’s review, each Party shall encourage its respective competent authorities, 
where appropriate, to implement the recommendation within a mutually agreed time. 
Temporary Licensing 
 
4. Where the Parties agree, each Party shall enc ourage the relevant bodies in its territory to 
develop procedures for the temporary licensing of professional service providers of the other Party. 
Review 
 5. The Commission shall periodically, and at least once every three years, review the 
implementation of this Section. The Commission sha ll include within the scope of its review any 
differences in regulatory approaches between the Parties. Among other issues, a Party may raise  WT/REG160/1 
 Page 123 
 
 
issues connected with the development of intern ational standards of re levant international 
organizations related to professional services.8 
 
Section B - Foreign Legal Consultants  
 1. Each Party shall, in implementing its obliga tions and commitments regarding foreign legal 
consultants as set out in its relevant Schedules to  Annex I or II and subject to any nonconforming 
measures therein, ensure that a national of the othe r Party is permitted to practice or advise on the law 
of any country in which that national is  authorized to practice as a lawyer. 
 
Consultations With Professional Bodies 
 
2. Each Party shall consult with its relevant professional bodies to obtain their recommendations 
on: 
(a) the form of association or partnership between lawyers authorized to practice in its 
territory and foreign legal consultants; 
(b) the development of standards and criteria for the authorization of foreign legal 
consultants in conformity with Article 11.9; and 
(c) other matters relating to the provision of foreign legal consultancy services. 
3. Prior to initiation of consultati ons under paragraph 7, each Party shall encourage its relevant 
professional bodies to consult with the relevant professional bodies designated by the other Party 
regarding the development of joint recommendations  on the matters referred to in paragraph 2. 
Future Liberalization 
 
4. Each Party shall establish a work program to develop common procedures throughout its 
territory for the authorization of foreign legal consultants. 
5. Each Party shall promptly review any recomme ndation referred to in pa ragraphs 2 and 3 to 
ensure its consistency with this Agreement. If the recommendation is consistent with this Agreement, 
each Party shall encourage its competent authorit ies to implement the recommendation within one 
year. 
6. Each Party shall report to the Commission within one year of the date of entry into force of 
this Agreement, and each year thereafter, on its  progress in implementing the work program referred 
to in paragraph 4. 
7. The Parties shall meet within one year of the date  of entry into force of this Agreement with a 
view to: 
(a) assessing the implementation of paragraphs 2 through 5; 
(b) amending or removing, where appropriate , non-conforming measures on foreign legal 
consultancy services; and 
                                                     
 
8 The term “relevant international organizations” refers to international bodies whose membership is 
open to the relevant bodies of at least both Parties. WT/REG160/1 
Page 124  
 
(c) assessing further work that may be appropria te regarding foreig n legal consultancy 
services. 
 
Section C - Temporary Licensing Of Engineers
 
 1. The Parties shall meet within one year of the da te of entry into force of this Agreement to 
establish a work program to be undertaken by each Pa rty, in conjunction with  its relevant professional 
bodies, to provide for the temporary licensing in its territory of nationals of the other Party who are 
licensed as engineers in the terr itory of that other Party.  
2. To this end, each Party shall consult with its relevant professional bodies to obtain their 
recommendations on: 
(a) the development of procedures for the te mporary licensing of such engineers to 
permit them to practice their engineering specialties in each jurisdiction in its 
territory; 
(b) the development of model procedures fo r adoption by the competent authorities 
throughout its territory to facilitate the temporary licensing of such engineers; 
(c) the engineering specialties to which priority  should be given in developing temporary 
licensing procedures; and 
(d) other matters relating to the temporary licensing of engineers identified by the Party 
in such consultations. 
3. Each Party shall request its relevant pr ofessional bodies to make recommendations on the 
matters referred to in paragraph 2 within two years of the date of entry into force of this Agreement. 
4. Each Party shall encourage its relevant professional bodies to meet at the earliest opportunity 
with the relevant professional bodies of the other Part y with a view to cooperating in the development 
of joint recommendations on the matters referred to in  paragraph 2 within two years of the date of 
entry into force of this Agreement. Each Part y shall request an annual report from its relevant 
professional bodies on the progress achieved in  developing those recommendations. 
5. The Parties shall promptly review any recomme ndation referred to in pa ragraphs 3 or 4 to 
ensure its consistency with this Agreement. If the recommendation is consistent with this Agreement, 
each Party shall encourage its competent authorit ies to implement the recommendation within one 
year. 
6. The Commission shall review the implementation of  this Section within two years of the date 
of entry into force of this Section. 
7. Appendix 11.9-C applies to the Parties specified therein. 
 
APPENDIX 11.9-C 
 
Civil Engineers
 
  The rights and obligations of Section C of A nnex 11.9 apply to Chile with respect to civil 
engineers (“ingenieros civiles”) and to such othe r engineering specialties that Chile may designate.  WT/REG160/1 
 Page 125 
 
 
CHAPTER TWELVE : FINANCIAL SERVICES 
 
Article 12.1 
 
Scope And Coverage  
 
1. This Chapter applies to measures adopted or maintained by a Party relating to: 
(a) financial institutions of the other Party; 
(b) investors of the other Party, and investments of such investors, in financial 
institutions in the Party’s territory; and 
(c) cross-border trade in financial services. 
2. Articles 10.8 through 10.12 and 11.11 are hereby in corporated into and made a part of this 
Chapter. Section B of Chapter Ten (Investment) is he reby incorporated into and made a part of this 
Chapter solely for breaches by a Party of Articles 10.8 through 10. 11, as incorporated into this 
Chapter.1 No other provision of Chapter Ten (Investment ) or Chapter Eleven (Cross Border Trade in 
Services) shall apply to a measure  described in paragraph 1.  
3. This Chapter does not apply to measures adopt ed or maintained by a Party relating to: 
(a) activities or services forming part of a public retirement plan or statutory system of 
social security; or 
(b) activities or services conducted for the account  or with the guarantee or using the 
financial resources of the Party, including its public entities,  
except that this Chapter shall apply if a Party allo ws any of the activities or services referred to in 
subparagraphs (a) or (b) to be conducted by its financial instituti ons in competition with a public 
entity or a financial institution. 
Article 12.2 
 
National Treatment  
 1. Each Party shall accord to investors of the othe r Party treatment no less favourable than that it 
accords to its own investors, in like circumstances,  with respect to the establishment, acquisition, 
expansion, management, conduct, operation, and sale or other disposition of financial institutions and 
investments in financial institutions in its territory. 
2. Each Party shall accord to financial institutions  of the other Party and to investments of 
investors of the other Party in financial institutions  treatment no less favorable than that it accords to 
its own financial institutions, and to  investments of its own investors in financial institutions, in like 
circumstances, with respect to the establishment, acquisition, expansion, management, conduct, 
operation, and sale or other disposition of financial institutions and investments. 
3. For purposes of the national treatment obligations  in Article 12.5(1), a Party shall accord to 
cross-border financial service suppliers of the other Party treatment no less favorable than that it 
                                                     
 
1 For greater certainty, the provi sions of Chapter Ten (Investment) hereby incorporated include, are 
subject to, and shall be interpreted in conformity with, Annexes 10-A through 10-H of that Chapter, as 
applicable. WT/REG160/1 
Page 126  
 
accords to its own financial service suppliers, in like circumstances, with respect to the supply of the 
relevant service. 
Article 12.3 
 
Most-Favored-Nation Treatment
 
 
1. Each Party shall accord to investors of the other Party, financial instituti ons of the other Party, 
investments of investors in financial institutions, and cross-border financial service suppliers of the 
other Party treatment no less favorable than that it  accords to the investors, financial institutions, 
investments of investors in financial institutions and crossborder financial service suppliers of a non-
Party, in like circumstances. 
2. A Party may recognize prudential measures of a non-Party in the application of measures 
covered by this Chapter. Such recognition may be:  
(a) accorded unilaterally; 
(b) achieved through harmonization or other means; or 
(c) based upon an agreement or arrangement with the non-Party. 
3. A Party according recognition of prudential measures under paragraph 2 shall provide 
adequate opportunity to the other Party to demonstr ate that circumstances exist in which there are or 
will be equivalent regulation, oversight, implementati on of regulation, and, if  appropriate, procedures 
concerning the sharing of information between the Parties. 
4. Where a Party accords recognition of pruden tial measures under paragraph 2(c) and the 
circumstances set out in paragraph 3 exist, the Pa rty shall provide adequate opportunity to the other 
Party to negotiate accession to the agreement or a rrangement, or to negotiate a comparable agreement 
or arrangement. 
Article 12.4 
 
Market Access For Financial Institutions  
  Neither Party may, with respect to investors of the other Party, either on the basis of a 
regional subdivision or on the basis of its entir e territory adopt or maintain measures that: 
 
(a) impose limitations on: 
(i) the number of financial institutions whether in the form of numerical quotas, 
monopolies, exclusive financial service suppliers, or the requirements of an economic needs test, 
(ii) the total value of financial service tr ansactions or assets in the form of 
numerical quotas or the requirement of an economic needs test,  
(iii) the total number of financial service operations or on the total quantity of 
financial services output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test, or 
(iv) the total number of natural persons that  may be employed in a particular 
financial service sector or that a financ ial institution may employ and who are  WT/REG160/1 
 Page 127 
 
 
necessary for, and directly related to, the supply of a specific financial service 
in the form of a numerical quota or the requirement of an economic needs test; or 
(b) restrict or require specific types of legal entity or joint venture through which a 
financial institution may supply a service. 
Article 12.5 
 
Cross-Border Trade
 
 1. Each Party shall permit, under terms and cond itions that accord national treatment, cross-
border financial service suppliers of the other Part y to supply the financial services specified in  
Annex 12.5. 
2. Each Party shall permit persons located in its te rritory, and its nationals wherever located, to 
purchase financial services from cross-border financial service suppliers of the other Party located in 
the territory of the other Party. This obligation does not require a Party to permit such suppliers to do 
business or solicit in its territory. Each Party may define “doing business” and “solicitation” for 
purposes of this Article as long as such definitions are not inconsistent with the obligations of 
paragraph 1. 
3. Without prejudice to other means of prudential regulation of cross-border trade in financial 
services, a Party may require the registration of cro ss-border financial service suppliers of the other 
Party and of financial instruments. 
Article 12.6 
 
New Financial Services
2 
 1. Each Party shall permit a financial institution of the other Party, on request or notification to 
the relevant regulator, where required, to supply a ny new financial service that the first Party would 
permit its own financial institutions, in like circumstances, to supply under its domestic law, provided 
that the introduction of the financial service does no t require the Party to adopt a new law or modify 
an existing law. 
2. A Party may determine the institutional and ju ridical form through which the new financial 
service may be supplied and may require authoriza tion for the supply of the service. Where a Party 
would permit the new financial service and author ization is required, the decision shall be made 
within a reasonable time and authorization may only be refused for prudential reasons. 
Article 12.7 
 
Treatment Of Certain Information
 
 
 Nothing in this Chapter requires a Party to furnish or allow access to: 
 
(a) information related to the financial affair s and accounts of individual customers of 
financial institutions or cross-bor der financial service suppliers; or 
                                                      
2 The Parties understand that nothing in Article 12. 6 prevents a financial institution of a Party from 
applying to the other Party to consider authorizing the supply of a financial service that is supplied within 
neither Party’s territory. Such application shall be s ubject to the domestic law of the Party to which the 
application is made and, for greater certainty, shall not be subject to the obligations of  Article 12.6. WT/REG160/1 
Page 128  
 
(b) any confidential information, the disclosur e of which would impede law enforcement 
or otherwise be contrary to the public in terest or prejudice legitimate commercial 
interests of particular enterprises. 
Article 12.8 
 
Senior Management And Boards Of Directors
 
 1. Neither Party may require financial institutions of  the other Party to engage individuals of any 
particular nationality as senior manage rial or other essential personnel.  
2. Neither Party may require that more than a minor ity of the board of directors of a financial 
institution of the other Party be composed of nationals  of the Party, persons residing in the territory of 
the Party, or a combination thereof. 
Article 12.9 
 
Non-Conforming Measures
 
 
1. Articles 12.2 through 12.5 and 12.8 and S ection A of Annex 12.9 do not apply to: 
(a) any existing non-conforming measure that  is maintained by a Party at: 
(i) the central level of government, as set out by that Party in its Schedule to 
Annex III, 
(ii) a regional level of government, as set out  by that Party in its Schedule to 
Annex III, or 
(iii) a local level of government; 
(b) the continuation or pran ompt renewal of any non-conforming measure referred to in 
subparagraph (a); or 
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the 
extent that the amendment does not decr ease the conformity of the measure, as it 
existed immediately before the amendment, with Articles 12.2, 12.3, 12.4, and 12.8 
and Section A of Annex 12.9. 
2. Articles 12.2 through 12.5 and 12 .8 and Section A of Annex 12.9  do not apply to any measure 
that a Party adopts or maintains with respect to sect ors, subsectors, or activities, as set out in its 
Schedule to Annex III. 
3. Annex 12.9 sets out certain specific commitments by each Party. 
4. Where a Party has set out in its Schedule to A nnexes I and II a measure that does not conform 
to Articles 10.2, 10.3, 11.2, 11.3, or 11.4 pursuant to  paragraphs 1 and 2 of Articles 10.7 and 11.6, that 
measure shall be deemed to cons titute a non-conforming measure, pursu ant to paragraphs 1 and 2 of 
this Article, with respect to Article 12.2, Article 12. 3, or Article 12.4, or Section A of Annex 12.9, as 
the case may be, to the extent that the measure, s ector, sub-sector, or activity set out in the Schedule 
of non-conforming measures is covered by this Chapter. 
 
  WT/REG160/1 
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Article 12.10 
 
Exceptions  
 1. Notwithstanding any other provision of this Chap ter or of Chapters Ten (Investment), Eleven 
(Cross-Border Trade in Services), Thirteen (Tel ecommunications), Fifteen (Electronic Commerce), 
and Sixteen (Competition Policy, Designated M onopolies, and State Enterprises), including 
specifically Article 13.16 (Telecommunications -Relati onship to Other Chapters), a Party shall not be 
prevented from adopting or maintain ing measures for prudential reasons,
3 including for the protection 
of investors, depositors, policy holde rs, or persons to whom a fiducia ry duty is owed by a financial 
institution or crossborder financial service supplier, or to ensure the integrity and stability of the 
financial system. Where such measures do not confor m with the provisions of this Agreement referred 
to in this paragraph, they shall not be used as a means of avoiding the Party’s commitments or 
obligations under such provisions.4 
2. Nothing in this Chapter or Chapters Ten (I nvestment), Eleven (Cross-Border Trade in 
Services), Thirteen (Telecommunications), Fifteen  (Electronic Commerce), and Sixteen (Competition 
Policy, Designated Monopolies, and State Ente rprises), including specifically Article 13.16 
(Telecommunications – Relationship to Other Chapte rs), applies to non-discriminatory measures of 
general application taken by any public entity in pu rsuit of monetary and related credit policies or 
exchange rate policies. This pa ragraph shall not affect a Party’s obligations under Article 10.5 
(Performance Requirements) with respect to me asures covered by Chapter Ten (Investment) or 
Article 10.8 (Transfers). 
3. Notwithstanding Article 10.8 (Transfers), as inco rporated into this Chapter, a Party may 
prevent or limit transfers by a financial institution or cross-border financial service supplier to, or for 
the benefit of, an affiliate of or person related to such institution or  supplier, through the equitable, 
non-discriminatory and good faith application of me asures relating to maintenance of the safety, 
soundness, integrity, or financial responsibility of financial institutions or cross-border financial 
service suppliers. This paragraph does not prejudi ce any other provision of this Agreement that 
permits a Party to restrict transfers. 
4. For greater certainty, nothing in this Chapter shall be construed to prevent the adoption or 
enforcement by a Party of measures necessary to secu re compliance with laws or regulations that are 
not inconsistent with this Chapter, including those relating to the prevention of deceptive and 
fraudulent practices or to deal with the effects of a default on financial services  contracts, subject to 
the requirement that such measures are not applie d in a manner which would constitute a means of 
arbitrary or unjustifiable discrimination between  countries where like conditions prevail, or a 
disguised restriction on investment in financial ins titutions or cross-border trade in financial services 
as covered by this Chapter. 
Article 12.11 
 
Transparency  
 1. The Parties recognize that transparent regulations and policies and reasonable, objective, and 
impartial administration governing the activities of  financial institutions and financial service 
                                                     
 
3 It is understood that the term “prudential reasons”  includes the maintenance of the safety, soundness, 
integrity, or financial responsibility of individual financial institutions or cross-border financial service 
suppliers. 
4 The Parties understand that a Party may take measures for prudential reasons through regulatory or 
administrative authorities, in addition to those who have regulatory responsibilities with respect to financial 
institutions, such as ministries or departments of labour. WT/REG160/1 
Page 130  
 
suppliers are important in facilitating both access of financial institutions  and financial service 
suppliers to, and their operations in, each other’s markets.  
2. In lieu of Article 20.2 (Publication), each Party shall, to the extent practicable: 
(a) publish in advance any regulations of gene ral application relating to the subject 
matter of this Chapter that it proposes to adopt; and 
(b) provide interested persons and the other Party a reasonable opportunity to comment 
on such proposed regulations. 
3. Each Party’s regulatory authorities shall make available to interested persons their 
requirements, including any documentation required,  for completing applications relating to the 
supply of financial services. 
4. On the request of an applicant, the regulatory au thority shall inform the applicant of the status 
of its application. If such authority requires add itional information from the applicant, it shall notify 
the applicant without undue delay. 
5. A regulatory authority shall make an administrative decision on a completed application of an 
investor in a financial institution, a financial ins titution, or a cross-border financial service supplier of 
the other Party relating to the supply of a financia l service within 120 days, and shall promptly notify 
the applicant of the decision. An application sha ll not be considered complete until all relevant 
hearings are held and all necessary information is received. Where it is not practicable for a decision 
to be made within 120 days, the regulatory author ity shall notify the applicant without undue delay 
and shall endeavor to make the decision within a reasonable time thereafter. 
6. Each Party shall maintain or establish appropria te mechanisms that will respond to inquiries 
from interested persons regarding measures of ge neral application covered by this Chapter. 
7. Each Party shall ensure that the rules of gene ral application adopted or maintained by self-
regulatory organizations of the Party are promptly published or otherwise made available in such a 
manner as to enable interested persons  to become acquainted with them.  
8. To the extent practicable, each Party should allow reasonable time between publication of 
final regulations and their effective date. 
9. At the time it adopts final regulations, a Part y should, to the extent practicable, address in 
writing substantive comments received from inte rested persons with respect to the proposed 
regulations. 
Article 12.12 
 
Self-Regulatory Organizations
 
  Where a Party requires a financial institution or a cross-border financial service supplier of 
the other Party to be a member of, participate in , or have access to, a self-regulatory organization to 
provide a financial service in or in to the territory of that Party, the Party shall ensure observance of 
the obligations of Articles 12.2 and 12.3  by such self-regulatory organization.  WT/REG160/1 
 Page 131 
 
 
Article 12.13 
 
Payment And Clearing Systems  
  Under terms and conditions that accord national treatment, each Party shall grant to financial 
institutions of the other Party established in its  territory access to payment and clearing systems 
operated by public entities, and to official funding and refinancing facilities available in the normal 
course of ordinary business. This paragraph is not intended to confer access to the Party’s lender of 
last resort facilities.  
Article 12.14 
 
Expedited Availability Of Insurance Services
 
  The Parties recognize the importance of mainta ining and developing regulatory procedures to 
expedite the offering of insurance services by licensed suppliers. 
 
Article 12.15 
 
Financial Services Committee
 
 
1. The Parties hereby establish the Financial Se rvices Committee. The principal representative 
of each Party shall be an official of the Party’s au thority responsible for financial services set out in 
Annex 12.15. 
2. In accordance with Article 21.1(2)(d) (The  Free Trade Commission), the Committee shall: 
(a) supervise the implementation of this Chapter and its further elaboration; 
(b) consider issues regarding financial services that are referred to it by a Party; and 
(c) participate in the dispute settlement proc edures in accordance with Articles 12.17 and 
12.18. 
3. The Committee shall meet annually, or as otherw ise agreed, to assess the functioning of this 
Agreement as it applies to financial services. The Committee shall inform the Commission of the 
results of each meeting. 
Article 12.16 
 
Consultations  
 1. A Party may request in writing consultations with  the other Party regarding any matter arising 
under this Agreement that affects financial ser vices. The other Party shall give sympathetic 
consideration to the request. The Parties shall re port the results of their consultations to the 
Committee. 
2. Officials from the authorities specified in Anne x 12.15 shall participate in the consultations 
under this Article.  
3. Nothing in this Article shall be construed to  require regulatory authorities participating in 
consultations under paragraph 1 to disclose informati on or take any action that would interfere with 
specific regulatory, supervisory, administrative, or enforcement matters. WT/REG160/1 
Page 132  
 
4. Nothing in this Article shall be construed to re quire a Party to derogate  from its relevant law 
regarding sharing of information among financial re gulators or the requirements of an agreement or 
arrangement between financial authorities of the Parties.  
Article 12.17 
 
Dispute Settlement
 
 1. Chapter Twenty-Two (Dispute Settlement) app lies as modified by this Article to the 
settlement of disputes arising under this Chapter. 
2. For purposes of Article 22.4 (Consultations), consultations held unde r Article 12.16 with 
respect to a measure or matter shall be deemed to constitute consultati ons under Article 22.4(1), 
unless the Parties otherwise agree. Upon initiatio n of consultations, the Parties shall provide 
information and give confidential treatment under Ar ticle 22.4(4)(b) to the information exchanged. If 
the matter has not been resolved within 45 days after commencing consultations under Article 12.16 
or 90 days after the delivery of the request for c onsultations under Article 12. 16, whichever is earlier, 
the complaining Party may request in writing the estab lishment of an arbitral panel. The Parties shall 
report the results of their consultations to the Commission. 
3. The Parties shall establish by January 1, 2005, and maintain a roster of up to 10 individuals 
who are willing and able to serve as financial services panellists, up to four of whom shall be non-
Party nationals. The roster members shall be appoint ed by mutual agreement of the Parties, and may 
be reappointed. Once established, a roster shall rema in in effect for a minimum of three years, and 
shall remain in effect thereafter until the Parties constitute a new roster. 
4. Financial services roster members shall: 
(a) have expertise or experience in financial services law or practice, which may include 
the regulation of financial institutions; 
(b) be chosen strictly on the basis of obj ectivity, reliability, and sound judgment; 
(c) be independent of, and not affiliated with or take instructions from, either Party; and 
(d) comply with a code of conduct to be established by the Commission. 
5. Where a Party claims that a dis pute arises under this Chapter, Article 22.9 (Panel Selection) 
shall apply, except that, unless the Parties otherwis e agree, the panel shall be composed entirely of 
panellists meeting the qualifi cations in paragraph 4. 
6. In any dispute where a panel finds a measure to be inconsistent with the obligations of this 
Agreement and the measure affects: 
(a) only the financial services sector, the complaining Party may suspend benefits only in 
the financial services sector; 
(b) the financial services sector and any other sector, the complaining Party may suspend 
benefits in the financial services sector that have an effect equivalent to the effect of 
the measure in the Party’s financial services sector; or 
(c) only a sector other than the financial serv ices sector, the complaining Party may not 
suspend benefits in the financial services sector.  WT/REG160/1 
 Page 133 
 
 
Article 12.18 
 
Investment Disputes In Financial Services  
 1. Where an investor of one Party submits a claim under Article 10.15 (Submission of a Claim 
to Arbitration) to arbitration under Section B of Chapter Ten (Investment) against the other Party and 
the respondent invokes Article 12.10, on request of the respondent, the tribunal shall refer the matter 
in writing to the Committee for a d ecision. The tribunal may not proceed pending receipt of a decision 
or report under this Article.  
2. In a referral pursuant to paragraph 1, the Comm ittee shall decide the issue of whether and to 
what extent Article 12.10 is a valid defense to th e claim of the investor. The Committee shall transmit 
a copy of its decision to the tribunal and to the Commission. The decision shall be binding on the tribunal.  
3. Where the Committee has not decided the issue within 60 days of the receipt of the referral 
under paragraph 1, the respondent or the Party of the claimant may request the establishment of an 
arbitral panel under Article 22.6 (Request for an Ar bitral Panel). The panel shall be constituted in 
accordance with Article 12.17. Further to Article 22 .13 (Final Report), the panel shall transmit its 
final report to the Committee and to the tribunal. The report shall be binding on the tribunal. 
4. Where no request for the establishment of a pa nel pursuant to paragraph 3 has been made 
within 10 days of the expiration of the 60-day pe riod referred to in paragraph 3, the tribunal may 
proceed to decide the matter. 
Article 12.19 
 
Definitions
 
  For purposes of this Chapter: 
 
 cross-border financial service supplier of a Party  means a person of a Party that is engaged 
in the business of supplying a financial service with in the territory of the Party and that seeks to 
supply or supplies a financial service through the cross-border supply of such services;   cross-border trade in financial services or cross-border supply of financial services  
means the supply of a financial service: 
 
(a) from the territory of one Party into the territory of the other Party, 
(b) in the territory of a Party by a person of th at Party to a person of the other Party, or 
(c) by a national of a Party in the territory of the other Party, 
but does not include the supply of a service in the te rritory of a Party by an investment in that 
territory;   financial institution  means any financial intermediary or other enterprise that is authorized to 
do business and regulated or supervised as a financia l institution under the law of the Party in whose 
territory it is located; 
 
 financial institution of the other Party  means a financial institution, including a branch, 
located in the territory of a Party that is controlled by persons of the other Party;  
 WT/REG160/1 
Page 134  
 
 financial service  means any service of a financial nature. Financial services include all 
insurance and insurance-related services, and a ll banking and other financial services (excluding 
insurance), as well as services incidental or auxilia ry to a service of a financial nature. Financial 
services include the following activities:  Insurance And Insurance-Related Services 
 
(a) Direct insurance (including co-insurance): 
(i) life 
(ii) non-life 
(b) Reinsurance and retrocession; 
(c) Insurance intermediation, such as brokerage and agency; 
(d) Service auxiliary to insuran ce, such as consultancy, act uarial, risk assessment, and 
claim settlement services. 
Banking And Other Financial Services (Excluding Insurance) 
 
(e) Acceptance of deposits and other repayable funds from the public; 
(f) Lending of all types, including consumer credit, mortgage credit, factoring and 
financing of commercial transactions; 
(g) Financial leasing; 
(h) All payment and money transmission servi ces, including credit, charge and debit 
cards, travelers checks, and bankers drafts; 
(i) Guarantees and commitments; 
(j) Trading for own account or for account of customers, whether on an exchange, in an 
over-the-counter market, or otherwise, the following: 
(i) money market instruments (including ch ecks, bills, certificates of deposits); 
(ii) foreign exchange; 
(iii) derivative products including, futures and options; 
(iv) exchange rate and interest rate instru ments, including products such as swaps, 
forward rate agreements; 
(v) transferable securities; 
(vi) other negotiable instruments and financial assets, including bullion; 
(k) Participation in issues of all kinds of securities, including underwriting and placement 
as agent (whether publicly or privately) and provision of services related to such issues;  WT/REG160/1 
 Page 135 
 
 
(l) Money broking; 
(m) Asset management, such as cash or portfolio management, all forms of collective 
investment management, pension fund mana gement, custodial, depository, and trust 
services; 
(n) Settlement and clearing services for financia l assets, including securities, derivative 
products, and other negotiable instruments; 
(o) Provision and transfer of financial inform ation, and financial data processing and 
related software by suppliers of other financial services; 
(p) Advisory, intermediation, and other auxilia ry financial services on all the activities 
listed in subparagraphs (e) through (o), including credit reference and analysis, 
investment and portfolio research and advi ce, advice on acquisitions and on corporate 
restructuring and strategy; 
 financial service supplier of a Party means a person of a Party that is engaged in the 
business of supplying a financial service within the territory of that Party;  
 investment  means “investment” as defined in Article 10.27 (Definitions), except that, with 
respect to “loans” and “debt instrume nts” referred to in that Article: 
 
(a) a loan to or debt instrument issued by a financial institution is an investment only 
where it is treated as regulatory capital by the Party in whose territory the financial 
institution is located; and 
(b) a loan granted by or debt instrument owne d by a financial institution, other than a 
loan to or debt instrument of a financial institution referred to in  subparagraph (a), is 
not an investment; 
for greater certainty, a loan granted by or debt instrument owned by a cross-border financial service 
supplier, other than a loan to or debt instrument i ssued by a financial institution, is an investment if 
such loan or debt instrument meets the criteria fo r investments set out in Article 10.27 (Definitions); 
  investor of a Party  means a Party or state enterprise thereof, or a person of a Party, that 
attempts to make, is making, or has made an investme nt in the territory of the other Party;  provided, 
however, that a natural person who is a dual national shall be deemed to be exclusively a national of 
the State of his/her dominant and effective nationality; 
 
 new financial service  means a financial service not supplied in the Party’s territory that is 
supplied within the territory of the other Party, a nd includes any new form of delivery of a financial 
service or the sale of a financial product that is not sold in the Party’s territory;   
 person of a Party  means “person of a Party” as defined in Article 2.1 (General Definitions) 
and, for greater certainty, does not include a branch of an enterprise of a non-Party;    public entity  means a central bank or monetary aut hority of a Party, or any financial 
institution owned or controlled by a Party;  
 self-regulatory organization  means any non-governmental bod y, including any securities or 
futures exchange or market, clearing agency, other organization or association, that exercises its own 
or delegated regulatory or supervisory authorit y over financial service suppliers or financial 
institutions; and WT/REG160/1 
Page 136  
 
 tribunal  means an arbitration tribunal established under Article 10.18 (Selection of 
Arbitrators).   
ANNEX 12.5 
 
Cross-Border Trade
 
 
Insurance And Insurance-Related Services 
 1. For the United States, Article 12.5(1) applies to the cross-border supply of or trade in 
financial services as defined in s ubparagraph (a) of the definition of  cross-border supply of financial 
services in Article 12.19 with respect to: 
(a) insurance of risks relating to: 
(i) maritime shipping and commercial av iation and space launching and freight 
(including satellites), with such insurance to cover any or all of the following: 
the goods being transported, the vehicle transporting the goods, and any liability arising therefrom; and 
(ii) goods in international transit; 
(b) reinsurance and retrocession, services a uxiliary to insurance as described in 
subparagraph (d) of the definition of fina ncial service, and insurance intermediation 
such as brokerage and agency as described in subparagraph (c) of the definition of 
financial service. 
2. For the United States, Article 12.5(1) applies to the cross-border supply of or trade in 
financial services as defined in s ubparagraph (c) of the definition of  cross-border supply of financial 
services in Article 12.19 with respect to insurance services.  
3. For Chile, Article 12.5(1) applies to the cross-bor der supply of or trade in financial services as 
defined in subparagraph (a) of th e definition of cross-border supply of financial services in Article 
12.19 with respect to: 
(a) insurance of risk relating to: 
(i) international maritime transport and in ternational commercial aviation, with 
such insurance to cover any or all of the following: the goods being 
transported, the vehicle transporti ng the goods, and any liability deriving 
therefrom; and 
(ii) goods in international transit.  
(b) brokerage of insurance of risks rela ting to subparagraph (a)(i) and (a)(ii). 
(c) reinsurance and retrocession; reinsurance br okerage; and consultancy, actuarial, and 
risk assessment. 
4. Chile’s commitments regarding sale and brokerage  of insurance for international maritime 
transport, international commercial aviation, and go ods in international transit shall apply one year 
after the entry into force of this Agreement or when Chile has made and implemented the necessary 
amendments to its pertinent legisl ation, whichever occurs first.   WT/REG160/1 
 Page 137 
 
 
Banking And Other Financial Services (Excluding Insurance) 
 
5. For the United States, Article 12.5(1) applies w ith respect to the provision and transfer of 
financial information and financia l data processing as described in subparagraph (o) of the definition 
of financial service and advisory and other auxilia ry financial services, excluding intermediation, 
relating to banking and other financial services as descr ibed in subparagraph (p) of the definition of 
financial service. 
6. For Chile, Article 12.5(1) applies with respect to: 
(a) provision and transfer of financial informati on as described in s ubparagraph (o) of the 
definition of financial service. 
(b) financial data processing as described in subparagraph (o) of the definition of 
financial service, subject to prior author ization from the relevant regulator, as 
required.5 
(c) advisory and other auxiliary financial ser vices, excluding intermediation and credit 
reference and analysis, relating to banking and other financial services as described in 
subparagraph (p) of the defin ition of financial service.  
Notwithstanding subparagraph (c), in the event that afte r the date of entry into force of this Agreement 
Chile allows credit reference and analysis to be supplied by cross-border financial service suppliers, it 
shall accord national treatment (as specified in Article 12.2(3)) to cross-border financial service suppliers of the United States. Nothing in this co mmitment shall be construed to prevent Chile from 
subsequently restricting or prohibiting the supply of  credit reference and analysis services by cross-
border financial service suppliers. 
 7. It is understood that a Party’s commitments on cross-border investment advisory services 
shall not, in and of themselves, be construed to require the Party to permit the public offering of 
securities (as defined under its relevant law) in the te rritory of the Party by cross-border suppliers of 
the other Party who supply or seek to supply such investment advisory services. A Party may subject 
the cross-border suppliers of investment advisory services to regulatory and registration requirements. 
 
ANNEX 12.9 
 
Specific Commitments
 
 
Section A: Right Of Establishment With  Respect To Certain Financial Services  
 
1. In lieu of Article 12.4 with respect to ba nking and other financial services (excluding 
insurance): 
(a) Each Party shall permit an investor of the other Party 
(i) that does not own or control a financial institution in the Party’s territory to 
establish in that territory a financial institution permitted to supply financial 
services that such an institution may supply under the domestic law of the 
                                                      
5 It is understood that where the financial information or financial data processing referred to in 
subparagraphs (a) and (b) involve personal data, the treatment  of such personal data sh all be in accordance with  
Chilean law regulating the protection of such data. WT/REG160/1 
Page 138  
 
Party at the time of establishment,  without the imposition of numerical 
restrictions, and 
(ii) that owns or controls a financial institu tion in the Party’s territory to establish 
in that territory such additional fina ncial institutions as may be necessary to 
permit the supply of the full range of  financial services allowed under the 
domestic law of the Party at the time of establishment of the additional 
financial institutions.  
  The right of establishment shall incl ude the acquisition of existing entities. 
 
(b) Neither Party may restrict or require specific types of juridical form with respect to 
the initial financial institution that the investor seeks to establish pursuant to 
subparagraph (a)(i). 
(c) Except with respect to the imposition of numerical or juridical form restrictions on 
establishment of the initial financial ins titution described in subparagraph (a)(i), a 
Party may, consistent with Article  12.2, impose terms and conditions on 
establishment of additional financial instituti ons described in subparagraph (a)(ii) and 
determine the institutional and juridical form through which particular permitted 
financial services or activities are supplied. 
(d) A Party may, consistent with Article 12.2,  prohibit a particular financial service or 
activity.
6 
2. For purposes of this Annex: 
(a) an “investor of the other Party” means an investor of the other Party engaged in the 
business of providing banking and other financial services (excluding insurance) in the territory of that Party. 
(b) “numerical restrictions” means limitations imposed, either on the basis of a regional 
subdivision or on the basis of the entire territory of the Party, on the number of 
financial institutions whether in the form  of numerical quotas, monopolies, exclusive 
service suppliers, or the requirements of an economic needs test. 
3. Notwithstanding the inclusion of the non-confor ming measures of Chile in Annex III, Section 
II, referring to social services, Chile, with respect to the establishment by an investor of the United 
States of an Administradora de Fondos de Pensiones under  Decreto Ley 3.500, shall: 
(a) apply subparagraph 1(a) of Section A of this Annex, and 
(b) not apply an economic needs test. 
No other modification of the effect of the non-conforming measures referring to social services is 
intended or shall be constr ued under this paragraph. 
 4. The specific commitments of the United States under paragraph 1 are subject to the headnotes 
and non-conforming measures set forth in Sections A and B of Annex III with respect to banking and 
other financial services (excluding insurance). 
                                                     
 
6 The Parties understand that a Party may not prohibit all financial services or a complete financial  
services subsector such as banking.  WT/REG160/1 
 Page 139 
 
 
5. The specific commitments of Chile under paragra phs 1 and 3 are subject to the headnotes and 
non-conforming measures set forth in Annex III of Chile  with respect to banking and other financial 
services (excluding insurance). 
 
Section B: Voluntary Savings Plans; Non-Di scriminatory Treatment of U.S. Investors  
 
1. Notwithstanding the inclusion of the non-confor ming measures of Chile in Annex III, Section 
II, referring to social services, with respect to  voluntary savings pension plans established under Ley 
19.768, Chile shall extend the obligations of Article  12.2(1) and (2) and of Article 12.3 to financial 
institutions of the United States, investors of the Un ited States, and investments of such investors in 
financial institutions established in Chile. The speci fic commitment contained in this paragraph shall 
enter into force by March 1, 2005.  
2. Notwithstanding the inclusion of the nonconformi ng measures of Chile in Annex III, Section 
II, referring to social services, Chile, as required by its domestic law, shall not establish arbitrary differences with respect to U.S. investors in Administradoras de Fondos de Pensiones under  Decreto 
Ley 3.500. 
 
Section C: Portfolio Management
 
 
1. Each Party shall allow a financial institution (other than a trust company or insurance 
company), organized outside its territory, to provide investment advice and portfolio management 
services, excluding (1) custodial services, (2) trus tee services, and (3) execution services that are not 
related to managing a collective investment scheme, to a collective investment scheme located in the 
Party’s territory. This commitment is subject to Ar ticle 12.1 and to the provisions of Article 12.5(3) 
regarding the right to require registration, without  prejudice to other means of prudential regulation. 
2. Notwithstanding paragraph 1, a Party may requir e the collective investme nt scheme located in 
the Party’s territory to retain ultimate responsibilit y for the management of the collective investment 
scheme or the funds that it manages. 
3. For purposes of paragraphs 1 and 2, collective investment scheme  means: 
(a) in the United States, an investment comp any registered with  the Securities and 
Exchange Commission under the Investment Company Act of 1940 ; and 
(b) in Chile, the following fund management co mpanies subject to supervision by the 
Superintendencia de Valores y Seguros : 
(i) Compañías Administradoras de Fondos Mutuos  (Decreto Ley  1.328 de 
1976); 
(ii) Compañías Administradoras  de Fondos de Inversión  (Ley 18.815 de 1989); 
(iii) Compañías Administradoras de Fondos  de Inversión de Capital Extranjero  
(Ley 18.657 de 1987); 
(iv) Compañías Administradoras de Fondos para la Vivienda  (Ley 18.281 de 
1993); and 
(v) Compañías Administradoras Generales de Fondos  (Ley 18.045 de 1981). WT/REG160/1 
Page 140  
 
Section D: Expedited Availability of Insurance Services
 
 
 Each Party should endeavor to maintain ex isting opportunities or may wish to consider 
policies or procedures such as: not requiring pro duct approval for insurance other than sold to 
individuals or compulsory insurance; allowing introduction of products unless those products are 
disapproved within a reasonable period of time; and not imposing limitations on the number or 
frequency of product introductions. This Section does not apply to the specific category of Chilean 
government-supported insurance programs, such as climate insurance.   
Section E: Insurance Branching
 
 
1. Notwithstanding the inclusion of the nonconformi ng measures of Chile in Annex III, Section 
II, referring to insurance market access, excl uding any portion of those nonconforming measures 
referring to financial conglomerates and social services,  no later than four years after the date of entry 
into force of this Agreement, Chile shall allow U. S. insurance suppliers to establish in its territory 
through branches. Chile may choose how to regula te branches, including their characteristics, 
structure, relationship to their parent company, capital requirements, technical reserves, and obligations regarding risk patrimony and their investments.
7 
2. Recognizing the principles of federalism under th e U.S. Constitution, the history of state 
regulation of insurance in the United States, and the McCarran-Ferguson Act , the United States will 
work with the National Association of Insurance Co mmissioners (NAIC) in its review of those states 
that do not allow initial entry of a non-US insura nce company as a branch to supply life, accident, 
health (excluding worker’s compensation) insu rance, nonlife insurance,  or reinsurance and 
retrocession to determine whether such entry coul d be provided in the future. Those states are 
Arkansas, Arizona, Connecticut, Georgia, Hawaii (branching allowed for reinsurance), Kansas, 
Maryland, Minnesota, Nebraska, New Jersey, Nort h Carolina, Pennsylvania, Tennessee, Vermont, 
and Wyoming. 
 
   
 
 
                                                     
 
7 The Parties understand that for this purpose, Chile may establish the following requirements among 
others: 
(a) that the capital and reserves that foreign insura nce companies assign to their branches must be 
effectively transferred and converted into domes tic currency in conformity with Chilean law; 
(b) that the increases of capital and reserves that  do not come from capitalization of other reserves 
will have the same treatment as initial capital and reserves; 
(c) that in the transactions between a branch and its parent or other related companies each shall 
be considered as independent entities; 
(d) that the branch owners or shareholders m eet the solvency and integrity requirements 
established in Chile’s insurance legislation; 
(e) that branches of foreign insura nce companies that operate in Ch ile may transfer liquid profits 
only  if they do not have an investment deficit in their technical reserves and risk patrimony, 
nor a deficit of risk patrimony.  WT/REG160/1 
 Page 141 
 
 
ANNEX 12.11 
  The Parties recognize that Chile’s implementation of the obligations of paragraphs 2 and 9 of 
Article 12.11 may require legislative and regulatory ch anges. Chile shall implement the obligations of 
these paragraphs no later than two years after the date of entry into force of this Agreement. 
 
 
ANNEX 12.15 
 
Authorities Responsible For Financial Services
 
 
 The authority of each Party responsible for financial services shall be:  
(a) for Chile, the Ministerio de Hacienda ; and 
(b) for the United States, the Department of the Treasury for banking and other financial 
services and the Office of the United States Trade Representative, in coordination 
with the Department of Commerce and ot her agencies, for insurance services. 
 
CHAPTER THIRTEEN : TELECOMMUNICATIONS 
 
Article 13.1 
 
Scope And Coverage
 
 1. This Chapter applies to: 
(a) measures adopted or maintained by a Party relating to access to and use of the public 
telecommunications network and services; 
(b) measures adopted or maintained by a Party relating to obligations of major suppliers 
of public telecommunications services; 
(c) measures adopted or maintained by a Party relating to the provision of information 
services; and 
(d) other measures relating to public tel ecommunication networks or services. 
2. Except to ensure that enterprises operating br oadcast stations and cable systems have 
continued access to and use of public telecommunica tions networks and services, this Chapter does 
not apply to any measure adopted or maintained by a Party relating to cable or broadcast distribution 
of radio or television programming.  
3. Nothing in this Chapter shall be construed to: 
(a) require a Party or require a Party to compel  any enterprise to establish, construct, 
acquire, lease, operate, or provide telecommunications networks or 
telecommunications services, where such networks or services are not offered to the public generally; 
(b) require a Party to compel any enterprise excl usively engaged in the cable or broadcast 
distribution of radio or television progr amming to make available its cable or 
broadcast facilities as a public telecommunications network; or  WT/REG160/1 
Page 142  
 
(c) prevent a Party from prohibiting persons ope rating private networks from using their 
networks to provide public telecommunicati ons networks or services to third persons. 
Article 13.2 
 
Access To And Use Of Public Telecommunications Networks And Services
1 
 
1. Each Party shall ensure that enterprises of the other Party have access to and use of any public 
telecommunications service, including leased circuits, offered in its territory or across its borders, on 
reasonable and non-discriminatory te rms and conditions, including as set out in paragraphs 2    
through 6. 
2. Each Party shall ensure that su ch enterprises are permitted to: 
(a) purchase or lease, and attach terminal or other equipment that interfaces with the 
public telecommunications network; 
(b) provide services to individual or multiple  end-users over any leased or owned 
circuit(s); 
(c) connect owned or leased circuits with public telecommunications networks and 
services in the territory, or across the borders, of that Party or with circuits leased or 
owned by another person; 
(d) perform switching, signaling, pro cessing, and conversi on functions; and 
(e) use operating protocols of their choice. 
3. Each Party shall ensure that enterprises of th e other Party may use public telecommunications 
services for the movement of information in its territory or across its borders and for access to 
information contained in databases or otherwise stor ed in machine-readable form in the territory of 
either Party. 
4. Further to Article 23.1 (General Exceptions) and notwithstanding paragraph 3, a Party may 
take such measures as are necessary to: 
(a) ensure the security and confidentiality of messages; or 
(b) protect the privacy of non-public personal data of subscribers to public 
telecommunications services, 
subject to the requirement that such measures are not applied in a manner that would constitute a 
means of arbitrary or unjustifiable discriminati on or disguised restriction on trade in services. 
 
5. Each Party shall ensure that no condition is imposed on access to and use of public 
telecommunications networks or services, other than that necessary to: 
(a) safeguard the public service responsibilities of providers of public 
telecommunications networks or services, in  particular their ability to make their 
networks or services available to the public generally; or 
                                                      
1 For greater certainty, access to unbu ndled network elements, including access to leased circuits as an 
unbundled network element, is addressed in Article 13.4(3).  WT/REG160/1 
 Page 143 
 
 
(b) protect the technical integrity of public  telecommunications networks or services. 
6. Provided that conditions for access to and use of public telecommunications networks or 
services satisfy the criteria set out in paragraph 5, such conditions may include:  
(a) a requirement to use specified technical interfaces, including interface protocols, for 
interconnection with such networks or services; and 
(b) a licensing, permit, registration, or notif ication procedure which, if adopted or 
maintained, is transparent and appli cations filed thereunder are processed 
expeditiously. 
Article 13.3 
 
Obligations Relating To Interconnection With Suppl iers Of Public Telecommunications Services  
 1. Each Party shall ensure that suppliers of pu blic telecommunications services in its territory 
provide, directly or indirectly, interconnection with the suppliers of public telecommunications services of the other Party. 
2. In carrying out paragraph 1, each Party shall ensure, in accordance with its domestic law and 
regulations, that suppliers of public telecommunicati ons services in its territory take reasonable steps 
to protect the confidentiality of commercially sens itive information of, or relating to, suppliers and 
end-users of public telecommunications services a nd only use such information for the purpose of 
providing those services. 
Article 13.4 
 
Additional Obligations Relating To Conduct Of Major Suppliers Of Public Telecommunications 
Services2 
Treatment By Major Suppliers 
 1. Subject to Annex 13.4(1), each Party shall ensure  that major suppliers in its territory accord 
suppliers of public telecommunica tions services of the other Party non-discriminatory treatment 
regarding: 
(a) the availability, provisioning, rates, or quality of like public telecommunications 
services; and 
(b) the availability of technical inte rfaces necessary for interconnection.  
Competitive Safeguards 
 
2. (a) Each Party shall maintain appropriat e measures for the purpose of preventing 
suppliers who, alone or together, are a majo r supplier in its territory from engaging in 
or continuing anti-competitive practices. 
(b) For purposes of subparagraph (a), examples of anti-competitive practices include: 
(i) engaging in anti-competitive cross-subsidization; 
                                                     
 
2 For purposes of this Agreement, this Article does not apply to suppliers of commercial mobile 
services. Nothing in this Agreement shall be construed to preclude an authority from imposing measures set 
forth in this Article upon suppliers of commercial mobile services. WT/REG160/1 
Page 144  
 
(ii) using information obtained from compe titors with anti-competitive results; 
and 
(iii) not making available, on a timely basis, to suppliers of public 
telecommunications services, technical information about essential facilities and commercially relevant information which are necessary for them to 
provide public telecommunications services. 
Unbundling Of Network Elements 
 
3. (a) Each Party shall provide its competent body the authority to require that major 
suppliers in its territory provide suppliers  of public telecommunications services of 
the other Party access to network elements on an unbundled basis for the supply of 
those services on terms and conditions and at  cost-oriented rates that are reasonable 
and non-discriminatory. 
(b) Which network elements will be  required to be made available in its territory, and 
which suppliers may obtain such elements, will be determined in accordance with 
national law and regulation(s). 
(c) In determining the network elements to be  made available, each Party’s competent 
body shall consider, at a minimum, in accordance with national law and regulation: 
(i) whether access to such network elements  as are proprietary in nature is 
necessary, and whether the failure to  provide access to such network 
elements would impair the ability of s uppliers of public telecommunications 
services of the other Party to provide the services they seek to offer; or 
(ii) other factors as established in national law or regulation, 
  as that body construes these factors. 
 
Co-Location 
 
4. (a) Each Party shall ensure that major supplie rs in its territory provide to suppliers of 
public telecommunications services of the other Party physical co-location of equipment necessary for interconnection or  access to unbundled network elements on 
terms, conditions, and at cost-orien ted rates that are reasonable and non-
discriminatory. 
(b) Where physical co-location is not practical  for technical reasons or because of space 
limitations, each Party shall ensure that ma jor suppliers in its territory provide: 
(i) alternative solutions; or 
(ii) facilitate virtual co-location,  
  on terms, conditions, and at cost-ori ented rates that are reasonable and non-
discriminatory. 
 
(c) Each Party may determine which premises sh all be subject to subparagraphs (a) and 
(b). 
  WT/REG160/1 
 Page 145 
 
 
Resale 
 
5. Each Party shall ensure that major suppliers in its territory: 
(a) offer for resale, at reasonable rates,3 to suppliers of public telecommunications 
services of the other Party, public telecommunications services that such major 
supplier provides at retail to end user s that are not suppliers of public 
telecommunications services; and 
(b) subject to Annex 13.4(5)(b), do not impose unreasonable or discriminatory conditions 
or limitations on the resale of such services. 
Number Portability 
 
6. Each Party shall ensure that major suppliers in  its territory provide number portability to the 
extent technically feasible, on a timely b asis, and on reasonable terms and conditions. 
Dialing Parity 
 7. Each Party shall ensure that major suppliers in its territory provide dialing parity to suppliers 
of public telecommunications services of the other Party and afford suppliers of public 
telecommunications services of the other Party non-discriminatory access to telephone numbers and 
related services with no unreasonable dialing delays. 
Interconnection 
 8. (a) General Terms and Conditions 
Each Party shall ensure that major suppliers  in its territory provide interconnection for 
the facilities and equipment of suppliers of  public telecommunications services of the 
other Party: 
 
(i) at any technically feasible point in the major supplier’s network; 
(ii) under non-discriminatory terms, conditi ons (including technical standards 
and specifications), and rates; 
(iii) of a quality no less favorable than that provided by such major supplier for its 
own like services, or for like services of non-affiliated service suppliers or for like services of its subsidiaries or other affiliates; 
(iv) in a timely fashion, on terms, conditions (including technical standards and 
specifications), and cost-oriented rates that are transparent, reasonable, having regard to economic feasibility, a nd sufficiently unbundled so that the 
supplier need not pay for network components or facilities that it does not require for the service to be provided; and 
(v) on request, at points in addition to the network termination points offered to 
the majority of users, subject to charges that reflect the cost of construction of 
necessary additional facilities. 
                                                     
 
3 The standard of reasonableness in this paragraph is satisfied, among others, by wholesale rates or 
cost-oriented rates set pursuant to domestic law and regulations. WT/REG160/1 
Page 146  
 
(b) Options for Interconnecting with Major Suppliers 
  Each Party shall ensure that suppliers of public telecommunications services of the 
other Party may interconnect their fac ilities and equipment with those of major 
suppliers in its territory pursuant to at least one of the following options: 
 
(i) a reference interconnection offer or other standard interconnection offer 
containing the rates, terms, and cond itions that the major supplier offers 
generally to suppliers of public telecommunications services; or  
(ii) the terms and conditions of an existi ng interconnection agreement or through 
negotiation of a new interconnection agreement. 
(c) Public Availability of Interconnection Offers 
  Each Party shall require each major supplie r in its territory to make publicly available 
a reference interconnection offer or other standard interconnection offer containing 
the rates, terms, and conditions that the majo r supplier offers generally to suppliers of 
public telecommunications services. 
 
(d) Public Availability of the Procedures for Interconnection 
  Each Party shall make publicly av ailable the applicable procedures for 
interconnection negotiations with ma jor suppliers in its territory. 
 
(e) Public Availability of Interconnecti on Agreements with Major Suppliers 
  Each Party shall: 
 
(i) require major suppliers in its territory to  file all interconnection agreements to 
which they are party with its telecommunications regulatory body, and 
(ii) make publicly available interconnection agreements in force between major 
suppliers in its territory and other su ppliers of public telecommunications 
services in such territory. 
Leased Circuits Services
4 
 
9. (a) Each Party shall ensure that major supplie rs in its territory provide enterprises of the 
other Party leased circuits services that are public telecommunications services, on 
terms, conditions, and at rates that are reasonable and non-discriminatory. 
(b) In carrying out subparagraph (a), each Pa rty shall provide its telecommunications 
regulatory body the authority to require majo r suppliers in its territory to offer leased 
circuits that are part of the public telecommunications services to enterprises of the other Party at flat-rate prices that are cost-oriented. 
Article 13.5 
 
Submarine Cable Systems
 
 
                                                      
4 For greater certainty, access to unbundled network elements, includi ng access to leased circuits as  an 
unbundled network element, is addressed in Article 13.4(3).  WT/REG160/1 
 Page 147 
 
 
1. Each Party shall ensure that en terprises in its territory that operate submarine cable systems 
accord non-discriminatory treatment for access to submarine cable systems. 
2. Whether to apply paragraph 1 may be based on classification by a Party of such submarine 
cable system within its territory as a public telecommunications service supplier. 
Article 13.6 
 
Conditions For Supplying Information Services  
 1. Neither Party may require an enterprise in its  territory that it classifies as a supplier of 
information services (which supplies such ser vices over facilities that it does not own) to: 
(a) supply those services to the public generally; 
(b) cost-justify its rates for such services; 
(c) file a tariff for such services; 
(d) interconnect its networks with any partic ular customer for the supply of such 
services; or 
(e) conform with any particular standard or technical regulation for interconnection for 
the supply of such services other than for interconnection to a public telecommunications network. 
2. Notwithstanding paragraph 1, a Party may take  appropriate action, including any of the 
actions described in paragraph 1, to remedy a pr actice of an information services supplier that the 
Party has found in a particular case to be anti-co mpetitive under its law or regulation(s), or to 
otherwise promote competition or safeguard the interests of consumers.  
Article 13.7 
 
Independent Telecommunications Regulatory Bodies
 
 
1. Each Party shall ensure that its telecommunica tions regulatory body is separate from, and not 
accountable to, any supplier of public telecommunica tions services. To this end, each Party shall 
ensure that its telecommunications regulatory body does not hold a financial interest or maintain an 
operating role in any such supplier.  
2. Each Party shall ensure that the decisions  and procedures of its telecommunications 
regulatory body are impartial with respect to all in terested persons. To this end, each Party shall 
ensure that any financial interest that it holds in  a supplier of public telecommunications services does 
not influence the decisions and procedures of its telecommunications regulatory body. 
Article 13.8 
 
Universal Service  
 
 Each Party shall administer any universal ser vice obligation that it maintains or adopts in a 
transparent, non-discriminatory, and competitively ne utral manner and shall ensure that its universal 
service obligation is not more burdensome than necessar y for the kind of universal service that it has 
defined. WT/REG160/1 
Page 148  
 
Article 13.9 
 
Licensing Procedures
 
 1. When a Party requires a supplier of public te lecommunications services to have a license, the 
Party shall make publicly available: 
(a) the licensing criteria and procedures it applies, and the time it normally requires to act 
on an application, for issuing a license; and 
(b) the terms and conditions of all licenses it has issued. 
2. Each Party shall ensure that, upon request, an app licant receives the reasons for the denial of a 
license. 
Article 13.10 
 
Allocation And Use Of Scarce Resources
 
 
1. Each Party shall administer its procedures fo r allocating and using scarce telecommunications 
resources, including frequencies, numbers, and rights of  way, in an objective, timely, transparent, and 
non-discriminatory manner. 
2. Each Party shall make publicly available the current state of allocated frequency bands but 
shall not be required to provide detailed identification of frequencies allocated for specific uses. 
3. Decisions on allocating and assigning spectrum and frequency management are not measures 
that are inconsistent with Article  11.4 (Market Access), which is a pplied to Chapter Ten (Investment) 
through Article 11.1(3) (Scope and Coverage). Accordingly, each Party retains the right to exercise its 
spectrum and frequency management policies, which may affect the number of suppliers of public 
telecommunications services, provided that this is done in a manner that is consistent with the 
provisions of this Agreement. The Parties also reta in the right to allocate frequency bands taking into 
account existing and future needs. 
Article 13.11 
 
Enforcement  
  Each Party shall ensure that its competent authority is authorized to enforce domestic 
measures relating to the obligations set out in Articles 13.2 through 13.5. Such authority shall include 
the ability to impose effective sanctions, which may include financial penalties, injunctive relief (on 
an interim or final basis), or the modification, suspension, and revocation of licenses.  
Article 13.12 
 
Procedures For Resolving Domestic Telecommunications Disputes
 
  Further to Articles 20.4 (Administrative Pro ceedings) and 20.5 (Review and Appeal), each 
Party shall ensure the following:  Recourse To Telecommunications Regulatory Bodies 
 
(a) (i) Each Party shall ensure that enterpri ses of the other Party may have recourse 
to a national telecommunications regul atory body or other relevant body to  WT/REG160/1 
 Page 149 
 
 
resolve disputes arising under domestic measures addressing a matter set out in Articles 13.2 through 13.5. 
(ii) Each Party shall ensure that suppliers  of public telecommunications services 
of the other Party that have requested  interconnection with a major supplier 
in its territory may have recourse, w ithin a reasonable and publicly available 
period of time after the supplier requ ests interconnection, to a national 
telecommunications regulatory body or  other relevant body to resolve 
disputes regarding the terms, conditions , and rates for interconnection with 
such major supplier.  
Reconsideration 
 
(b) Each Party shall ensure that an enterprise that is aggrieved or whose interests are 
adversely affected by a determination or  decision of a national telecommunications 
regulatory body or other relevant body  may petition the body to reconsider its 
determination or decision. Neither Party ma y permit such a petition to constitute 
grounds for non-compliance with such determination or decision of the 
telecommunications regulatory body or ot her relevant body unl ess an appropriate 
authority stays such determination or decision. 
Judicial Review 
 
(c) Each Party shall ensure that any enterpri se aggrieved by a determination or decision 
of the national telecommunications regulatory body or other relevant body may 
obtain judicial review of such determination or decision by an impartial and independent judicial authority. 
Article 13.13 
 
Transparency
 
  Further to Article 20.2 (Publication), each Pa rty shall make publicly available its measures 
relating to access to and use of public telecommunica tions services including its measures relating to: 
 
(a) tariffs and other terms and conditions of service; 
(b) specifications for technical interfaces; 
(c) bodies responsible for preparing, amending, and adopting standards-related measures 
affecting access and use; 
(d) conditions for attaching terminal or other equipment to the public 
telecommunications network; and 
(e) notification, permit, registration, or licensing requirements, if any. 
Article 13.14 
 
Flexibility In The Choice Of Technologies
 
  Each Party shall endeavor to not prevent suppliers of public telecommunications services 
from having the flexibility to choose the technologies th at they use to supply their services, including 
commercial mobile wireless services. WT/REG160/1 
Page 150  
 
Article 13.15 
 
Forbearance
 
  The Parties recognize the importance of relying on market forces to achieve wide choices in 
the supply of telecommunications services. To this end, where provided for under domestic law, each 
Party may forbear from applying regulation to a tele communication service that the Party classifies as 
a public telecommunications service if its teleco mmunications regulatory body determines that: 
 
(a) enforcement of such regulation is not necessary to prevent unreasonable or 
discriminatory practices; 
(b) enforcement of such regulation is not neces sary for the protection of consumers; and 
(c) forbearance is consistent with the public interest, including promoting and enhancing 
competition among suppliers of public telecommunications services. 
Article 13.16 
 
Relationship To Other Chapters
 
  In the event of any inconsistency between this Chapter and another Chapter, this Chapter shall 
prevail to the extent of the inconsistency.  
Article 13.17 
 
Definitions
 
  For purposes of this Chapter: 
 
 commercial mobile services  means public telecommunications services supplied through 
mobile wireless means;   cost-oriented  means based on cost, and may include a reasonable profit, and may involve 
different cost methodologies for different facilities or services; 
 
 dialing parity  means the ability of a subscriber to use of an equal number of digits to access a 
public telecommunications service, regardless of the public telecommunications services supplier 
chosen by such end-user;  
 enterprise  means an “enterprise” as defined in  Article 2.1 (Definitions of General 
Application) and includes a branch of an enterprise;   end-user  means a final consumer of or subscriber to a public telecommunications service, 
including any service supplier other than a s upplier of public telecommunications services; 
 
 essential facilities  means facilities of a public telecommunications network or service that: 
 
(a) are exclusively or predominantly provided by  a single or limited number of suppliers, 
and 
(b) cannot feasibly be economically or techni cally substituted in order to provide a 
service;  WT/REG160/1 
 Page 151 
 
 
 information service  means the offering of a capability for generating, acquiring, storing, 
transforming, processing, retrieving, utilizin g, or making available information via 
telecommunications, and includes electronic publishi ng, but does not include any use of any such 
capability for the management, control, or opera tion of a telecommunications system or the 
management of a telecommunications service; 
 
 interconnection  means linking with suppliers providing public telecommunications services 
in order to allow the users of one supplier to comm unicate with users of another supplier and to access 
services provided by another supplier;  
 leased circuit  means telecommunications facilities be tween two or more designated points 
that are made available solely to, or dedicated excl usively for use by, a particular customer or other 
users of the customer’s choosing;   major supplier  means a supplier of public telecommunications services that has the ability to 
materially affect the terms of participation (having regard to price and supply) in the relevant market 
for public telecommunications services as a result of:  
(a) control over essential facilities; or 
(b) use of its position in the market; 
 network element  means a facility or equipment used in supplying a public 
telecommunications service, including features, func tions, and capabilities provided by means of such 
facility or equipment;   non-discriminatory means treatment no less favorable than that accorded to any other user of 
like public telecommunications services in like circumstances; 
 
 number portability  means the ability of end-users of public telecommunications services to 
retain, at the same location, existing telephone numbe rs without impairment of quality, reliability, or 
convenience when switching like suppliers of public telecommunications services;   physical co-location  means physical access to and control over space in order to install, 
maintain, or repair equipment, at premises owne d or controlled and used by a major supplier to 
provide public telecommunications services;   private network means a telecommunications network that is used exclusively for 
intraenterprise communications; 
 
 public telecommunications network means telecommunications infrastructure which a Party 
requires to provide public telecommunications servi ces between defined netw ork termination points; 
  public telecommunications service  means any telecommunications service which a Party 
requires, explicitly or in effect, to be offered to the public generally. Such services may include, inter 
alia, telephone and data transmission typically invo lving customer-supplied information between two 
or more points without any end-to-end change in th e form or content of the customer’s information, 
but does not include the offering of information services;   reference interconnection offer  means an interconnection offer that a major supplier extends 
and that is filed with or approved by a telecomm unications regulatory body and that is sufficiently 
detailed to enable a supplier of public telecommuni cations services that is willing to accept its rates, 
terms, and conditions to obtain interconnection wit hout having to engage in negotiations with the 
major supplier concerned; WT/REG160/1 
Page 152  
 
 telecommunications  means the transmission and reception of signals by any electromagnetic 
means, including by photonic means;   telecommunications regulatory body  means a body responsible for the regulation of 
telecommunications; and 
 
 user means an end-user or a supplier of public telecommunications services. 
  
ANNEX 13.4(1) 
 
 Article 13.4 does not apply to rural telephone companies, as defined in section 3(37) of the 
Communications Act of 1996, unless a state regulatory authority orders otherwise. Moreover, a state regulatory authority may exempt a rural local excha nge carrier, as defined in section 251(f)(2) of the 
Communications Act of 1996, from the obligations contained in Article 13.4. 
 
 
ANNEX 13.4(5)(b) 
  In the United States, a reseller that obtains at wholesale rates a telecommunications service that is available at retail only to a category of  subscribers may be prohibited from offering such 
service to a different category of subscribers. 
  
CHAPTER FOURTEEN : TEMPORARY ENTRY FOR BUSINESS PERSONS 
 
Article 14.1 
 
General Principles
 
 1. Further to Article 1.2 (Objectives), this Chapte r reflects the preferential trading relationship 
between the Parties, the mutual desire of the Par ties to facilitate temporary entry of business persons 
under the provisions of Annex 14.3 on a reciprocal basis and of establishing transparent criteria and 
procedures for temporary entry, and the need to ensure border security and to protect the domestic 
labor force and permanent employment in their respective territories. 
2. This Chapter does not apply to measures re garding citizenship, nationality, permanent 
residence, or employment on a permanent basis.  
Article 14.2 
 
General Obligations
 
 1. Each Party shall apply its measures relating to  the provisions of this  Chapter in accordance 
with Article 14.1(1) and, in particular, shall appl y expeditiously those measures so as to avoid unduly 
impairing or delaying trade in goods or servi ces or conduct of investment activities under this 
Agreement. 
2. For greater certainty, nothing in this Chapte r shall be construed to prevent a Party from 
applying measures to regulate the entry of natural pers ons into, or their temporary stay in, its territory, 
including those measures necessary to protect the inte grity of, and to ensure the orderly movement of 
natural persons across, its borders, provided that su ch measures are not applied in such a manner as to 
unduly impair or delay trade in goods or services or conduct of investment activities under this Agreement. The sole fact of requiring a visa fo r natural persons shall not  be regarded as unduly  WT/REG160/1 
 Page 153 
 
 
impairing or delaying trade in goods or servi ces or conduct of investment activities under this 
Agreement. 
Article 14.3 
 
Grant Of Temporary Entry  
 
1. Each Party shall grant temporary entry to business persons who are otherwise qualified for 
entry under applicable measures relating to pub lic health and safety and national security, in 
accordance with this Chapter, includi ng the provisions of Annex 14.3. 
2. A Party may refuse to issue an immigration doc ument authorizing employment to a business 
person where the temporary entry of that person might affect adversely: 
(a) the settlement of any labor dispute that is in progress at the place or intended place of 
employment; or 
(b) the employment of any person who is involved in such dispute. 
3. When a Party refuses pursuant to paragraph 2 to  issue an immigration document authorizing 
employment, it shall: 
(a) inform in writing the business person of the reasons for the refusal; and 
(b) promptly notify the other Party in writing of the reasons for the refusal. 
4. Each Party shall limit any fees for processing a pplications for temporary entry of business 
persons in a manner consiste nt with Article 14.2(1). 
Article 14.4 
 
Provision Of Information  
 1. Further to Article 20.2 (Publication), each Party shall: 
(a) provide to the other Party such materials as will enable it to become acquainted with 
its measures relating to this Chapter; and 
(b) no later than six months after the date of en try into force of this Agreement, prepare, 
publish, and make available in its own territory , and in the territory of the other Party, 
explanatory material, including references to  applicable laws and regulations, in a 
consolidated document regarding the requi rements for temporary entry under this 
Chapter in such a manner as will enable business persons of the other Party to 
become acquainted with them.  
2. Each Party shall collect and maintain, and make  available upon request to the other Party in 
accordance with its domestic law, data respecting th e granting of temporary entry under this Chapter 
to business persons of the other Party who have been  issued immigration documentation, with a view 
towards including data specific to each occupation, profession, or activity. 
 
   WT/REG160/1 
Page 154  
 
Article 14.5 
 
Committee On Temporary Entry
 
 1. The Parties hereby establish a Committee on Temporary Entry, comprising representatives of 
each Party, including immigration officials. 
2. The Committee shall: 
(a) establish a schedule for its meetings; 
(b) establish procedures to exchange informati on on measures that affect the temporary 
entry of business persons under this Chapter; 
(c) consider the development of measures to fu rther facilitate temporary entry of business 
persons on a reciprocal basis under the provisions of Annex 14.3; 
(d) consider the implementation and admi nistration of this Chapter; and  
(e) consider the development of common criteria and interpretations for the 
implementation of this Chapter. 
Article 14.6 
 
Dispute Settlement
 
 1. A Party may not initiate proceedings under Article 22.5 (Commission – Good Offices, 
Conciliation, and Mediation)  regarding a refusal to grant tempor ary entry under this Chapter or a 
particular case arising under Article 14.2 unless: 
(a) the matter involves a pattern of practice; and 
(b) the business person has exhausted the availa ble administrative remedies regarding the 
particular matter. 
2. The remedies referred to in paragraph (1)(b) sh all be deemed to be exhausted if a final 
determination in the matter has not been issued by  the competent authority within one year of the 
institution of an administrative proceeding, and the fa ilure to issue a determination is not attributable 
to delay caused by the business person. 
Article 14.7 
 
Relation To Other Chapters
 
 
1. Except for this Chapter, Chapters One (Initia l Provisions), Two (General Definitions), 
Twenty-One (Administration of the Agreement), Twenty-Two (Dispute Settlement), and Twenty-Four 
(Final Provisions), and Articles 20.1 (Contact Points), (Publication), 20.3 (Notification and Provision of Information), and 20.4 (Adminis trative Proceedings), no provision of this Agreement shall impose 
any obligation on a Party regarding its immigration measures. 
2. Nothing in this Chapter shall be construed to impose obligations or commitments with respect 
to other Chapters of this Agreement. 
  WT/REG160/1 
 Page 155 
 
 
Article 14.8 
 
Transparency In Development And Application Of Regulations1 
 1. Further to Chapter Twenty (Transparency), each Party shall establish or maintain appropriate 
mechanisms to respond to inquiri es from interested persons regard ing regulations relating to the 
temporary entry of business persons.  
2. Further to Article 20.2 (Publication), to the ex tent possible, each Party shall, on request, 
provide to interested persons a concise statement addressing comments received on proposed regulations relating to the temporary entry of bus iness persons at the time that it adopts the final 
regulations. 
3. Further to Article 20.2 (Publication), to th e extent possible, each Party shall allow a 
reasonable period of time between the date it publis hes final regulations governing entry of business 
persons and the date they take effect. 
4. Each Party shall, within a reasonable period afte r an application requesting temporary entry is 
considered complete under its domest ic laws and regulations, inform the applicant of the decision 
concerning the application. At the request of the applicant, the Party shall provide, without undue delay, information concerning the status of the application. 
Article 14.9 
 
Definitions
 
 
 For purposes of this Chapter:   business person means a national of a Party who is engaged in trade in goods, the supply of 
services, or the conduct of investment activities; 
 
 immigration measure  means any law, regulation, or procedure affecting the entry and 
sojourn of aliens;   national  has the same meaning as the term “natural  person who has the nationality of a Party” 
as defined in Annex 2.1 (Country-Specific Definitions); 
 
 professional  means a national of a Party who is enga ged in a specialty occupation requiring:  
 
(a) theoretical and practical application of a body of specialized knowledge, and 
(b) attainment of a post-secondary degree in the specialty requiring four or more years of 
study
2 (or the equivalent of such a degr ee) as a minimum for entry into the 
occupation; and 
 temporary entry means entry into the territory of a Party by a business person of the other 
Party without the intent to establish permanent residence. 
 
                                                      
1 For greater certainty, “regula tions” includes regulations establishing or applying to licensing 
authorization or criteria. 
2 Chile recognizes the Baccalaureat e Degree, Master’s De gree, and the Doctoral  Degree co nferred by 
institutions in the United States as such degrees. The United States recognizes the licenciatura  degree  and titulo 
profesional  and higher degrees conferred by ins titutions in Chile as such degrees. WT/REG160/1 
Page 156  
 
ANNEX 14.3 
 
Temporary Entry For Business Persons
 
 
Section A – Business Visitors  
 
1. Each Party shall grant temporary entry to a business person seeking to engage in a business 
activity set out in Appendix 14.3(A)(1), without  requiring that person to obtain an employment 
authorization, provided that the business person otherwise complies with immigration measures 
applicable to temporary entry, on presentation of:  
(a) proof of nationality of a Party; 
(b) documentation demonstrating that the business person will be so engaged and 
describing the purpose of entry; and 
(c) evidence demonstrating that the proposed bus iness activity is international in scope 
and that the business person is not seek ing to enter the local labor market. 
2. Each Party shall provide that a business pers on may satisfy the requirements of paragraph 
1(c) by demonstrating that: 
(a) the primary source of remuneration for the proposed business activity is outside the 
territory of the Party granting temporary entry; and 
(b) the business person’s principal place of business and the actual place of accrual of 
profits, at least predominantly, remain outside such territory. 
A Party shall normally accept an oral declaration as to the principal place of business and the actual 
place of accrual of profits. Where the Party requires further proof, it shall normally consider a letter 
from the employer attesting to these matters as sufficient proof.   3. Neither Party may: 
(a) as a condition for temporary entry under paragraph 1, requi re prior approval 
procedures, petitions, labor certification tests, or other procedures of similar effect; or 
(b) impose or maintain any numerical restri ction relating to temporary entry under 
paragraph 1. 
 
Section B – Traders And Investors
 
 
1. Each Party shall grant temporary entry and provide confirming documentation to a business 
person seeking to: 
(a) carry on substantial trade in goods or services principally between the territory of the 
Party of which the business person is a nati onal and the territory of the other Party 
into which entry is sought, or 
(b) establish, develop, administer, or provide advice or key technical services to the 
operation of an investment to which th e business person or the business person’s 
enterprise has committed, or is in the pro cess of committing, a substantial amount of 
capital,   WT/REG160/1 
 Page 157 
 
 
in a capacity that is supervisory, executive, or  involves essential skills, provided that the business 
person otherwise complies with immigration measures applicable to temporary entry.  2. Neither Party may: 
(a) as a condition for temporary entry under paragr aph 1, require labor certification tests 
or other procedures of similar effect; or 
(b) impose or maintain any numerical restri ction relating to temporary entry under 
paragraph 1. 
 
Section C – Intra-Company Transferees
 
 
1. Each Party shall grant temporary entry and provide confirming documentation to a business 
person employed by an enterprise who seeks to render services to that enterprise or a subsidiary or 
affiliate thereof, in a capacity that is manage rial, executive, or involves specialized knowledge, 
provided that the business person otherwise compli es with immigration measures applicable to 
temporary entry. A Party may require the business pe rson to have been employed continuously by the 
enterprise for one year within the three-year peri od immediately preceding the date of the application 
for admission. 
2. Neither Party may: 
(a) as a condition for temporary entry under paragr aph 1, require labor certification tests 
or other procedures of similar effect; or 
(b) impose or maintain any numerical restri ction relating to temporary entry under 
paragraph 1. 
 
Section D – Professionals  
 1. Each Party shall grant temporary entry and provide confirming documentation to a business 
person seeking to engage in a business activity as a professional, or to perform training functions 
related to a particular profession, including condu cting seminars, if the business person otherwise 
complies with immigration measures applicable to temporary entry, on presentation of: 
(a) proof of nationality of a Party; 
(b) documentation demonstrating that the business person will be so engaged and 
describing the purpose of entry; and 
(c) documentation demonstrating the attainment  of the relevant minimum educational 
requirements or alternative credentials. 
2. Notwithstanding the educational requirements set out in the definition of “professional” in 
Article 14.9, each Party shall grant temporary en try to a business person seeking to engage in a 
business activity as a professional in a profession set out  in Appendix 14.3(D)(2),  provided that the 
business person possesses the credentials specified  in the Appendix and complies with the 
requirements of paragraph 1 of this Section.  
3. To assist in the implementation of this Chapter, the Parties shall exchange by the date of entry 
into force of this Agreement illustrative lists of prof essions that meet the definition of professional. To WT/REG160/1 
Page 158  
 
facilitate the evaluation of applications for temp orary entry, the Parties shall also exchange 
information on post-secondary education. 
4. Neither Party may: 
(a) as a condition for temporary entry under paragraph 1, requi re prior approval 
procedures, petitions, labor certification tests, or other procedures of similar effect; or 
(b) impose or maintain any numerical restri ction relating to temporary entry under 
paragraph 1. 
5. Notwithstanding paragraph 4(a), a Party may require a business person seeking temporary 
entry under this Section to comply with procedur es applicable to temporary entry of professionals, 
such as an attestation of compliance with the Party’s labor and immigration laws. 
6. Notwithstanding paragraphs 1 and 4, a Party may establish an annual numerical limit, which 
shall be set out in Appendix 14.3(D)(6), regarding temporary entry of business persons of the other 
Party seeking to engage in business activities as a professional.  
7. A Party establishing a numerical limit pursuant to  paragraph 6, unless the Parties otherwise 
agree, may, in consultation with the other Part y, grant temporary entry under paragraph 1 to a 
business person who practices in a profession where accreditation, licensing, and certification 
requirements are mutually recognized by the Parties. 
8. Nothing in paragraphs 6 or 7 shall be constr ued to limit the ability of a business person to 
seek temporary entry under a Party’s applicable immigration measures relating to the entry of 
professionals other than those adopted or  maintained pursuant to paragraph 1. 
 
APPENDIX 14.3(A)(1) 
 
Business Visitors
 
 
Meetings And Consultations 
 
- Business persons attending meetings, seminars, or conferences; or engaged in consultations 
with business associates. 
 
Research And Design 
 
- Technical, scientific, and statistical researchers conducting independent research or research 
for an enterprise located in the territory of the other Party. 
 
Growth, Manufacture, And Production 
 
- Purchasing and production manage ment personnel conducting commercial transactions for an 
enterprise located in the territory of the other Party. 
 
Marketing 
 
- Market researchers and analysts  conducting independent research or analysis or research or 
analysis for an enterprise located in  the territory of the other Party. 
 - Trade fair and promotional pers onnel attending a trade convention.  WT/REG160/1 
 Page 159 
 
 
Sales 
 
- Sales representatives and agents taking orders or negotiating contracts for goods or services 
for an enterprise located  in the territory of the other Party but not delivering goods or 
providing services. 
 
- Buyers purchasing for an enterprise located in the territory of the other Party. 
 
Distribution 
 
- Customs brokers providing consulting services regarding the facilitation of the import or 
export of goods. 
 
After-Sales Service 
 
- Installers, repair and maintenance personne l, and supervisors, possessing specialized 
knowledge essential to a seller’s contractual ob ligation, performing services or training 
workers to perform services, pursuant to a warrant y or other service contract incidental to the 
sale of commercial or industrial equipment or  machinery, including computer software, 
purchased from an enterprise located  outside the territory of the Party into which temporary 
entry is sought, during the life of the warranty or service agreement. 
 
General Service 
 
- Management and supervisory personnel engaging in a commercial transaction for an 
enterprise located in the territory of the other Party. 
 
- Financial services personnel (insurers, ba nkers, or investment brokers) engaging in 
commercial transactions for an enterprise locat ed in the territory of the other Party. 
 - Public relations and advertisi ng personnel consulting with business associates, or attending or 
participating in conventions. 
 
- Tourism personnel (tour and travel agents, t our guides, or tour operators) attending or 
participating in conventions or  conducting a tour that has begun in the territory of the other 
Party. 
 
- Translators or interpreters performing services as employees of an enterprise located in the 
territory of the other Party. 
 
Definitions 
 
 For purposes of this Appendix, territory of the other Party  means the territory of the Party 
other than the territory of the Party into which temporary entry is sought.  
  WT/REG160/1 
Page 160  
 
APPENDIX 14.3(D)(2) 
 
PROFESSION MINIMUM EDUCATION REQUIREMENTS 
AND ALTERNATIVE CREDENTIALS 
Disaster Relief Claims Adjuster Baccalaureate or Licenciatura  degree, or Titulo 
Profesional , and successful completion of 
training in the appropriate areas of insurance 
adjustment pertaining to disaster relief claims; or three years experience in claims adjustment and successful completion of training in the appropriate areas of insurance adjustment pertaining to disaster relief claims. 
Management Consultant Baccalaureate or Licenciatura  degree, or Titulo 
Profesional . If the degree is in a discipline not 
related to the area of the consulting agreement, 
then equivalent professional experience as established by statement or professional credential attesting to three years experience in a field or specialty related to the consulting 
agreement is required. 
Agricultural Manager Baccalaureate or Licenciatura  degree; or Titulo 
Profesional ; or post-secondary certificate1 
requiring three years of study in the specialty and three years experience in the specialty. 
Physical Therapist Baccalaureate or Licenciatura  degree; or Titulo 
Profesional ; or post-secondary certificate 
requiring three years of study in the specialty and three years experience in the specialty. 
  
APPENDIX 14.3(D)(6) 
 
United States 
 
1. Beginning on the date of entry into force of th is Agreement, the United States shall annually 
approve as many as 1,400 initial applications of business persons of Chile seeking temporary entry 
under Section D of Annex 14.3 to engage in  a business activity at a professional level. 
2. For purposes of paragraph 1, the United States shall not take into account: 
(a) the renewal of a period of temporary entry; 
(b) the entry of a spouse or children accompanyi ng or following to join the principal 
business person; 
(c) an admission under section 101(a)(15)(H)(i)(b) of the Immigration and Nationality 
Act, 1952, as may be amended, including the worldwide numerical limit established 
by section 214(g)(1)(A) of that Act; or 
                                                     
 
1 Post-secondary certificate  means a certificate issued on completi on of post-secondary study, by an 
institution recognized by the Governme nt of Chile, or accredited by the re levant competent authority in the 
United States.  WT/REG160/1 
 Page 161 
 
 
(d) an admission under any other provision of secti on 101(a)(15) of that Act relating to 
the entry of professionals. 
 
CHAPTER FIFTEEN : ELECTRONIC COMMERCE 
 
Article 15.1 
 
General Provisions  
 1. The Parties recognize the economic growth and opportunity provided by electronic commerce 
and the importance of avoiding unnecessary barriers to its use and development. 
2. Nothing in this Chapter shall be construed to  prevent a Party from imposing internal taxes, 
directly or indirectly, on digital products, provided th ey are imposed in a manner consistent with this 
Agreement. 
3. This Chapter is subject to any other rele vant provisions, exceptions, or nonconforming 
measures set forth in other Chapters or Annexes of this Agreement.  
Article 15.2 
 
Electronic Supply Of Services
 
  The Parties recognize that the supply of a ser vice using electronic means falls within the 
scope of the obligations contained in the relevant  provisions of Chapter Eleven (Cross-Border Trade 
in Services) and Chapter Twelve (Financial Serv ices), subject to any nonconforming measures or 
exceptions applicable to such obligations.
1 
 
Article 15.3 
 
Customs Duties On Digital Products  
  Neither Party may apply customs duties on digital products of the other Party. 
 
Article 15.4 
 
Non-Discrimination For Digital Products
 
 1. A Party shall not accord less favorable treatment to a digital product than it accords to other 
like digital products, on the basis that: 
(a) the digital product receiving less favorable treatment is created, produced, published, 
stored, transmitted, contracted for, commissioned, or first made available on commercial terms in the territory of the other Party; or 
                                                     
 
1 For greater certainty, nothing in this Chapter impos es obligations to allow the electronic supply of a 
service nor the electronic tran smission of content associated with those services except in accordance with the 
provisions of Chapter Eleven (Cross-Border Trade in Services) or Chapter Twelve (Financial Services), 
including their Annexes (Non-Conforming Measures). WT/REG160/1 
Page 162  
 
(b) the author, performer, producer, developer, or  distributor of such digital products is a 
person of the other Party.
2 
2. (a) A Party shall not accord less favorable  treatment to a digital product created, 
produced, published, stored, transmitted, cont racted for, commissioned, or first made 
available on commercial terms in the territory  of the other Party than it accords to a 
like digital product created, produced, published,  stored, transmitted, contracted for, 
commissioned, or first made available on co mmercial terms in the territory of a non-
Party. 
(b) A Party shall not accord less favorable treat ment to digital products whose author, 
performer, producer, developer, or distributor  is a person of the other Party than it 
accords to like digital products whose aut hor, performer, producer, developer, or 
distributor is a person of a non-Party. 
3. A Party may maintain an existing measure that  does not conform with paragraph 1 or 2 for 
one year after the date of entry into force of this Agreement. A Party may maintain the measure 
thereafter, if the treatment the Party accords un der the measure is no less favourable than the 
treatment the Party accorded under the measure on the da te of entry into force of this Agreement, and 
the Party has set out the measure in its Schedule to Annex 15.4. A Party may amend such a measure 
only to the extent that the amendment does not d ecrease the conformity of the measure, as it existed 
immediately before the amendmen t, with paragraphs 1 and 2. 
Article 15.5 
 
Cooperation  
  Having in mind the global nature of elect ronic commerce, the Parties recognize the 
importance of:  
(a) working together to overcome obstacles encountered by small and medium 
enterprises in the use of electronic commerce; 
(b) sharing information and experiences on regula tions, laws, and programs in the sphere 
of electronic commerce, including tho se related to data privacy, consumer 
confidence, cyber-security, electronic signa tures, intellectual property rights, and 
electronic government; 
(c) working to maintain cross-border flows of  information as an essential element for a 
vibrant electronic commerce environment; 
(d) encouraging the development by the priv ate sector of methods of self-regulation, 
including codes of conduct, model contracts, guidelines, and enforcement mechanisms that foster electronic commerce; and 
(e) actively participating in international fo ra, at both a hemispheric and multilateral 
level, with the purpose of promoting the development of electronic commerce. 
 
                                                     
 
2 For greater certainty, if one or more of the criteria of paragraph 1(a) or (b) is satisfied, the obligation 
to accord no less favourable treatment to that digital product a pplies even if one or more of the activities listed 
in paragraph 1(a) occurs outside of the territory of the other Party, or one or more persons listed in paragraph 
1(b) are persons of the other Party or a non-Party.  WT/REG160/1 
 Page 163 
 
 
Article 15.6 
 
Definitions  
  For purposes of this Chapter: 
 
 digital products  means computer programs, text, vide o, images, sound recordings, and other 
products that are digitally encoded and transmitted electronically, regardless of whether a Party treats 
such products as a good or a service under its domestic law;
3 
 
 electronic means  means employing computer processing; and 
  electronic transmission  or transmitted electronically  means the transfer of digital products 
using any electromagnetic or photonic means.  
 
ANNEX 15.4 
 
Non-Discrimination For Digital Products
 
  The Schedule of a Party sets out the non-conforming measures maintained by that Party 
pursuant to Article 15.4(3). 
  
CHAPTER SIXTEEN : COMPETITION POLICY, DESIGNATED MONOPOLIES, AND 
STATE ENTERPRISES 
 
Article 16.1 
 
Anticompetitive Business Conduct
 
 1. Each Party shall adopt or maintain competiti on laws that proscribe anticompetitive business 
conduct, with the objective of promoting economic e fficiency and consumer welfare, and shall take 
appropriate action with respect to such conduct. 
2. Each Party shall maintain an authority res ponsible for the enforcement of its national 
competition laws. The enforcement policy of each Pa rty’s national competition authorities is not to 
discriminate on the basis of the nationality of the subjects of their proceedings. Each Party shall 
ensure that: 
(a) before it imposes a sanction or remedy against any person for violating its 
competition law, it affords the person the right to be heard and to present evidence, except that it may provide for the person to  be heard and present evidence within a 
reasonable time after it imposes an interim sanction or remedy; and 
(b) an independent court or tri bunal imposes or, at the person’s request, reviews any such 
sanction or remedy. 
3. Nothing in this Chapter shall be construed to  infringe each Party’s autonomy in developing its 
competition policies or in deciding how to enforce its competition laws. 
                                                     
 
3 For greater certainty, digital products do not include digitized representations of financial instruments, 
including money. The definition of digital products is without prejudice to the on-going WTO discussions on 
whether trade in digital products transmitted electronically is a good or a service. WT/REG160/1 
Page 164  
 
Article 16.2 
 
Cooperation
 
  The Parties agree to cooperate in the area of competition policy. The Parties recognize the 
importance of cooperation and coor dination between their respective authorities to further effective 
competition law enforcement in the free trade area. A ccordingly, the Parties shall cooperate on issues 
of competition law enforcement, including notificati on, consultation, and ex change of information 
relating to the enforcement of the Parties’ competition laws and policies.  
Article 16.3 
 
Designated Monopolies
 
 1. Nothing in this Chapter shall be construed to prevent a Party from designating a monopoly. 
2. Where a Party designates a monopoly and the desi gnation may affect the interests of persons 
of the other Party, the Party shall: 
(a) at the time of the designation endeavor to introduce such conditions on the operation 
of the monopoly as will minimize or eliminat e any nullification or impairment of 
benefits in the sense of Annex 22.2 (Nullification or Impairment); and 
(b) provide written notification, in advance wher ever possible, to the other Party of the 
designation and any such conditions. 
3. Each Party shall ensure that any privately-owned monopoly that it designates after the date of 
entry into force of this Agreement and any govern ment monopoly that it designates or has designated: 
(a) acts in a manner that is not inconsistent  with the Party’s obligations under this 
Agreement wherever such a monopoly exercises any regulatory, administrative, or 
other governmental authority that the Party has delegated to it in connection with the 
monopoly good or service, such as the power to grant import or export licenses, approve commercial transactions, or impose quotas, fees, or other charges; 
(b) acts solely in accordance with commercial cons iderations in its purchase or sale of the 
monopoly good or service in the relevant market, including with regard to price, quality, availability, marketability, transpor tation, and other term s and conditions of 
purchase or sale, except to comply with an y terms of its designation that are not 
inconsistent with subpa ragraph (c) or (d); 
(c) provides non-discriminatory treatment to c overed investments, to goods of the other 
Party, and to service suppliers of the other Party in its purchase or sale of the monopoly good or service in the relevant market; and 
(d) does not use its monopoly position to engage, e ither directly or indirectly, including 
through its dealings with its parent, subs idiaries, or other enterprises with common 
ownership, in anticompetitive practices in a non-monopolized market in its territory 
that adversely affect covered investments. 
4. This Article does not apply to procurement. 
 
  WT/REG160/1 
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Article 16.4 
 
State Enterprises  
 1. Nothing in this Agreement shall be constr ued to prevent a Party from establishing or 
maintaining a state enterprise. 
2. Each Party shall ensure that any state enterprise that it estab lishes or maintains acts in a 
manner that is not inconsistent with the Party’s obligations under this Ag reement wherever such 
enterprise exercises any regulatory, administrative, or other governmental authority that the Party has 
delegated to it, such as the power to expropriate, grant licenses, approve commercial transactions, or 
impose quotas, fees, or other charges. 
3. Each Party shall ensure that any state ente rprise that it establishes or maintains accords non-
discriminatory treatment in the sale of its goods or services to covered investments. 
Article 16.5 
 
Differences In Pricing
 
  The charging of different prices in different markets, or within the same market, where such differences are based on normal commercial consid erations, such as taking account of supply and 
demand conditions, is not in itself inco nsistent with Articles 16.3 and 16.4. 
 
Article 16.6 
 
Transparency And Information Requests
 
 1. The Parties recognize the value of transpar ency of government competition policies. 
2. On request, each Party shall make available to  the other Party public information concerning 
its: 
(a) competition law enforcement activities; and 
(b) state enterprises and designated monopolies, public or private, at any level of 
government. 
Requests under subparagraph (b) shall indicate the entiti es or localities involved, specify the particular 
products and markets concerned, and include indicia of  practices that may restrict  trade or investment 
between the Parties.  3. On request, each Party shall make available to  the other Party public information concerning 
exemptions provided under its competition laws. Requests shall specify the particular goods and 
markets of interest and include indicia that the exem ption may restrict trade or investment between the 
Parties. 
Article 16.7 
 
Consultations
 
 
 To foster understanding between the Parties, or to address specific matters that arise under 
this Chapter, each Party shall, on request of th e other Party, enter into consultations regarding 
representations made by the other Party. In its requ est, the Party shall indicate, if relevant, how the WT/REG160/1 
Page 166  
 
matter affects trade or investment between the Parties. The Party addressed shall accord full and 
sympathetic consideration to the concerns of the other Party.  
Article 16.8 
 
Disputes
 
  Neither Party may have recourse to dispute settlement under this Agreement for any matter 
arising under Article 16.1, 16.2, or 16.7.  
Article 16.9 
 
Definitions
 
  For purposes of this Chapter: 
 
 a delegation  includes a legislative grant, and a government order, directive, or other act, 
transferring to the monopoly or state enterprise, or authorizing the exercise by the monopoly or state enterprise of, governmental authority;   designate  means to establish, designate, or authorize,  formally or in effect, a monopoly or to 
expand the scope of a monopoly to c over an additional good or service; 
  government monopoly  means a monopoly that is owned, or controlled through ownership 
interests, by the national government of a Party or by another such monopoly;  
 in accordance with commercial considerations  means consistent with normal business 
practices of privately-held enterprises in the relevant business or industry; 
  market  means the geographic and commercial market for a good or service; 
  monopoly  means an entity, including a consortium or government agency, that in any 
relevant market in the territory of a Party is d esignated as the sole provider or purchaser of a good or 
service, but does not include an en tity that has been granted an exclusive intellectual property right 
solely by reason of such grant; and   non-discriminatory treatment  means the better of national treatment and most-favored 
nation treatment, as set out in the relevant provisions of this Agreement. 
  
CHAPTER SEVENTEEN : INTELLECTUAL PROPERTY RIGHTS 
 
 The Parties , 
 
 Desiring  to reduce distortions and impediments to trade between the Parties; 
  Desiring  to enhance the intellectual property syst ems of the two Parties to account for the 
latest technological developments and to ensure th at measures and procedures to enforce intellectual 
property rights do not themselves become barriers to legitimate trade;  
  Desiring  to promote greater efficiency and transpar ency in the administration of intellectual 
property systems of the Parties;   WT/REG160/1 
 Page 167 
 
 
 Desiring  to build on the foundations established in existing international agreements in the 
field of intellectual property, including the World Trade Organization (WTO) Agreement on Trade-
Related Aspects of Intellectual Property Rights  (TRIPS Agreement) and affirming the rights and 
obligations set forth in the TRIPS Agreement;  
 Recognizing  the principles set out in the Declara tion on the TRIPS Agreement on Public 
Health, adopted on November 14, 2001, by the WTO at  the Fourth WTO Ministerial Conference, held 
in Doha, Qatar;   Emphasizing  that the protection and enforcement of intellectual property rights is a 
fundamental principle of this Chapter that helps promote technological innovation as well as the 
transfer and dissemination of technology to the mu tual advantage of technology producers and users, 
and that encourages the development of social and economic well-being;   Convinced  of the importance of efforts to encour age private and public investment for 
research, developmen t, and innovation; 
  Recognizing  that the business community of each Party should be encouraged to participate in 
programs and initiatives for research, development, innovation, and the transfer of technology 
implemented by the other Party;  
 Recognizing  the need to achieve a balance betwee n the rights of right holders and the 
legitimate interests of users and the comm unity with regard to protected works; 
  Agree  as follows: 
 
Article 17.1 
 
General Provisions
 
 1. Each Party shall give effect to the provisions of  this Chapter and may, but shall not be obliged 
to, implement in its domestic law more extensive prot ection than is required by this Chapter, provided 
that such protection does not contravene the provisions of this Chapter. 
2. Before January 1, 2007, each Party shall ratify or accede to the Patent Cooperation Treaty  
(1984). 
3. Before January 1, 2009, each Party shall ratify or accede to: 
(a) the International Convention for the Protection of New Varieties of Plants  (1991); 
(b) the Trademark Law Treaty  (1994); and 
(c) the Convention Relating to the Distribution of Programme-Carrying Signals 
Transmitted by Satellite  (1974). 
4. Each Party shall undertake reasonable efforts to  ratify or accede to the following agreements 
in a manner consistent with its domestic law: 
(a) the Patent Law Treaty  (2000); 
(b) the Hague Agreement Concerning the International Registration of Industrial 
Designs  (1999); and WT/REG160/1 
Page 168  
 
(c) the Protocol Relating to the Madrid Ag reement Concerning the International 
Registration of Marks  (1989). 
5. Nothing in this Chapter concerning intellect ual property rights shall derogate from the 
obligations and rights of one Party with respect to  the other by virtue of the TRIPS Agreement or 
multilateral intellectual property ag reements concluded or administered under the auspices of the 
World Intellectual Property Organization (WIPO). 
6. In respect of all categories of intellectual prope rty covered in this Chapter, each Party shall 
accord to persons of the other Party treatment no less  favorable than it accords to its own persons with 
regard to the protection
1 and enjoyment of such intellectual pr operty rights and any benefits derived 
from such rights. With respect to secondary uses of phonograms by means of analog communications 
and free over-the-air radio broadcasting,  however, a Party may limit the rights of the performers and 
producers of the other Party to the rights its persons  are accorded within the jurisdiction of the other 
Party. 
7. Each Party may derogate from paragraph 6 in relation to its judicial and administrative 
procedures, including the designation of an address fo r service or the appointment of an agent within 
the jurisdiction of that Party, on ly where such derogations are n ecessary to secure compliance with 
laws and regulations that are not inconsistent w ith the provisions of this Chapter and where such 
practices are not applied in a manner that would constitute a disguised restriction on trade. 
8. Paragraphs 6 and 7 do not appl y to procedures provided in mu ltilateral agreements concluded 
under the auspices of WIPO relating to the acquisitio n or maintenance of intellectual property rights. 
9. This Chapter does not give rise to obligations in  respect of acts that occurred before the date 
of entry into force of this Agreement. 
10. Except as otherwise provided for in this Chapter,  this Chapter gives rise to obligations in 
respect of all subject matter existing at the date of  entry into force of this Agreement, and which is 
protected by a Party on that date, or which meets or comes subsequently to meet the criteria for protection under the terms of this Chapter. In resp ect of paragraphs 10 and 11, copyright and related 
rights obligations with respect to existing works and phonograms shall be de termined solely under 
Article 17.7(7). 
11. Neither Party shall be obligated to restore prot ection to subject matter which on the date of 
entry into force of this Chapter has falle n into the public domain in that Party. 
12. Each Party shall ensure that all laws, regula tions, and procedures concerning the protection or 
enforcement of intellectual property rights, and all final judicial decisions and administrative rulings 
of general applicability pertaining to the enforcement of such rights, shall be in writing and shall be 
published,
2 or where such publication is not practicable, made publicly available, in a national 
language in such a manner as to enable the other Pa rty and right holders to become acquainted with 
them, with the object of making the protection a nd enforcement of intellectual property rights 
transparent. Nothing in this paragraph shall requi re a Party to disclose confidential information the 
disclosure of which would impede law enforcement or otherwise be contrary to  the public interest or 
would prejudice the legitimate commercial interest s of particular enterprises, public or private. 
                                                      
1 For purposes of paragraphs 6 and 7, “protecti on” shall include matters affecting the availability, 
acquisition, scope, maintenance, and enforcement of intellect ual property rights as well as matters affecting the 
use of intellectual property rights specifically covered by this Chapter. For purposes of paragraphs 6 and 7, 
“protection” shall also include the prohibition on circum vention of effective technological measures pursuant to 
Article 17.7(5) and the provisions concerning rights management information pursuant to Article 17.7(6). 
2 The requirement for publication is satisfied by making the written document available to the public 
via the Internet.  WT/REG160/1 
 Page 169 
 
 
13. Nothing in this Chapter prev ents a Party from adopting measures necessary to prevent 
anticompetitive practices that may result from the abu se of the intellectual property rights set forth in 
this Chapter. 
14. For the purposes of strengthening the development and protection of intellectual property, and 
implementing the obligations of this Chapter, the Parties will cooperate, on mutually agreed terms and 
subject to the availability of appropriated funds, by means of: 
(a) educational and dissemination projects on the use of intellectual property as a 
research and innovation tool, as well as on the enforcement of intellectual property; 
(b) appropriate coordination, training, sp ecialization courses, and exchange of 
information between the intellectual prope rty offices and other institutions of the 
Parties; and 
(c) enhancing the knowledge, de velopment, and implementation of the electronic 
systems used for the management of intellectual property. 
Article 17.2 
 
Trademarks  
 1. Each Party shall provide that trademarks sh all include collective, certification, and sound 
marks, and may include geographical indications
3 and scent marks. Neither Party is obligated to treat 
certification marks as a separate category in its dom estic law, provided that the signs as such are 
protected. 
2. Each Party shall afford an opportunity for inte rested parties to oppose the application for a 
trademark. 
3. Pursuant to Article 20 of the TRIPS Agreement,  each Party shall ensure that any measures 
mandating the use of the term customary in common language as the common name for a good (“common name”) including, inter alia , requirements concerning the relative size, placement, or style 
of use of the trademark in relation to the common name, do not impair the use or effectiveness of 
trademarks used in relation to such good.  
4. Each Party shall provide that the owner of a registered trademark shall have the exclusive 
right to prevent third parties not having the owner’ s consent from using in the course of trade identical 
or similar signs, including subsequent geographical  indications, for goods or services that are related 
to those goods or services in respect of which the tr ademark is registered, where such use would result 
in a likelihood of confusion.
4 
5. Each Party may provide limited exceptions to the rights conferred by a trademark, such as fair 
use of descriptive terms, provided th at such exceptions take account of  the legitimate interests of the 
owner of the trademark and of third parties. 
6. Article 6 bis of the Paris Convention for the Protection of Industrial Property  (1967) (Paris 
Convention) shall apply, mutatis mutandis , to goods or services which are not similar to those 
                                                      
3 A geographical indication is capable of constituting a trademark to the extent that the geographical 
indication consists of any sign, or any combination of signs, capable of identifying a good or service as 
originating in the territory of a Party, or a region or locality in that territory, where a given quality, reputation, or other characteristic of the good or service is e ssentially attributable to its geographical origin. 
4 It is understood that likelihood of confusion is to be determined under the domestic trademark law of 
each Party. WT/REG160/1 
Page 170  
 
identified by a well-known trademark, whether register ed or not, provided that use of that trademark 
in relation to those goods or services would indicate a connection between those goods or services and the owner of the trademark and provided that the inte rests of the owner of the trademark are likely to 
be damaged by such use.  
7. Each Party shall, according to its domestic la w, provide for appropriate measures to prohibit 
or cancel the registration of a trademark identical or  similar to a well-known trademark, if the use of 
that trademark by the registration applicant is likel y to cause confusion, or to cause mistake, or to 
deceive or risk associating the trademark with th e owner of the well-known trademark, or constitutes 
unfair exploitation of the reputation of the trademar k. Such measures to prohibit or cancel registration 
shall not apply when the registration applican t is the owner of the well-known trademark. 
8. In determining whether a trademark is well- known, a Party shall not require that the 
reputation of the trademark extend beyond the sector of the public that normally deals with the 
relevant goods or services. 
9. Each Party recognizes the importance of the Joint Recommendation Concerning Provisions 
on the Protection of Well-Known Marks (1999), adopted by the Assembly of the Paris Union for the 
Protection of Industrial Property and the General Assembly of WIPO and shall be guided by the 
principles contained in this Recommendation. 
10. Each Party shall provide a system for the re gistration of trademarks, which shall include: 
(a) providing to the applicant a communication in writing, which may be electronic, of 
the reasons for any refusal to register a trademark; 
(b) providing to the applicant an opportunity to respond to communications from the 
trademark authorities, contest an initial refusal, and appeal judicially any final refusal 
to register; and 
(c) a requirement that decisions in oppositi on or cancellation proceedings be reasoned 
and in writing. 
11. Each Party shall work to provide, to the maximum degree practical, a system for the 
electronic application, processing, registration, and maintenance of trademarks.  
12. In relation to trademarks, Parties are encourag ed to classify goods and services according to 
the classification of the Nice Agreement Concerning the Interna tional Classification of Goods and 
Services for the Purposes of  the Registration of Marks  (1979). In addition, each Party shall provide 
that: 
(a) each registration or publication which concerns a trademark application or 
registration and which indicates the relevant goods or services shall indicate the 
goods or services by their names; and 
(b) goods or services may not be considered as being similar to each other simply on the 
ground that, in any registration or publication, they appear in the same class of any classification system, including the Nice Classification. Conversely, goods or services 
may not be considered as being dissimilar from each other simply on the ground that, 
in any registration or publication, they appear in different classes of any classification system, including the Nice Classification. 
 
  WT/REG160/1 
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Article 17.3 
 
Domain Names On The Internet  
 1. Each Party shall require that the management of its country-code top level domain (ccTLD) 
provide an appropriate procedure for the settlement of disputes, based on the principles established in 
the Uniform Domain-Name Di spute-Resolution Policy  (UDRP), in order to address the problem of 
trademark cyber-piracy. 
2. Each Party shall, in addition, require that the management of its respective ccTLD provide 
online public access to a reliable and accurate da tabase of contact information for domain-name 
registrants, in accordance with each Party’s law regarding protectio n of personal data. 
Article 17.4 
 
Geographical Indications
5 
 
1. Geographical indications, for the purposes of th is Article, are indications which identify a 
good as originating in the territory of a Party, or a region or locality in that territory, where a given quality, reputation, or other characteristic of the good is essentially attributable to its geographical 
origin. Any sign or combination of signs (such as words, including geographical and personal names, 
letters, numerals, figurative elements, and colors), in any form whatsoever, shall be eligible for 
protection or recognition as a geographical indication. 
2. Chile shall: 
(a) provide the legal means to identify and protect geographical indications of United 
States persons that meet the criteria in paragraph 1; and 
(b) provide to United States geographical indi cations of wines and spirits the same 
recognition as Chile accords to wines a nd spirits under the Chilean geographical 
indications registration system. 
3. The United States shall: 
(a) provide the legal means to identify and prot ect the geographical indications of Chile 
that meet the criteria in paragraph 1; and 
(b) provide to Chilean geographical indications of wines and spirits the same recognition 
as the United States accords to wines and spirits under the Certificate of Label 
Approval (COLA) system as administered by the Alcohol and Tobacco Tax and 
Trade Bureau, Department of Treasury (TTB ), or any successor agencies. Names that 
Chile desires to be included in the regulation set forth in 27 CFR Part 12 (Foreign Nongeneric), or any successor to that regulati on, will be governed by paragraph 4 of 
this Article. 
4. Each Party shall provide the means for persons of the other Party to apply for protection or 
petition for recognition of geographical indications. Each Party shall accept applications or petitions, 
as the case may be, without the requirement for in tercession by a Party on behalf of its persons. 
5. Each Party shall process applications or petitions, as the case may be, for geographical 
indications with a minimum of formalities. 
                                                     
 
5 For the purposes of this Article, persons of a Party shall also mean government agencies. WT/REG160/1 
Page 172  
 
6. Each Party shall make the regula tions governing filing of such a pplications or petitions, as the 
case may be, available to the public in both printed and electronic form.  
7. Each Party shall ensure that applications or  petitions, as the case may be, for geographical 
indications are published for opposition, and shal l provide procedures to effect opposition of 
geographical indications that are the subject of app lications or petitions. Each Party shall also provide 
procedures to cancel any registration resulting from an application or a petition. 
8. Each Party shall ensure that measures governi ng the filing of applications or petitions, as the 
case may be, for geographical indications set out clearly the procedures for these actions. Such procedures shall include contact information sufficien t for applicants or petitioners to obtain specific 
procedural guidance regarding the pr ocessing of applications or petitions. 
9. The Parties acknowledge the principle of exclusiv ity incorporated in the Paris Convention and 
TRIPS Agreement, with respect to rights in trademarks.  
10. After the date of entry into force of this Ag reement, each Party shall ensure that grounds for 
refusing protection or registration of a geographical indication include the following: 
(a) the geographical indication is confusingly similar to a pre-existing pending good faith 
application for a trademark or a pre-existing trademark registered in that Party; or 
(b) the geographical indication is confusingly similar to a pre-existing trademark, the 
rights to which have been acquired through use in good faith in that Party.  
11. Within six months of the entry into force of this Agreement, each Party shall communicate to 
the public the means by which it intends to implement paragraphs 2 through 10. 
Article 17.5 
 
Copyright
6 
 1. Each Party shall provide that authors
7 of literary and artistic works have the right8 to authorize 
or prohibit all reproductions of their works, in any manner or form, permanent or temporary 
(including temporary storage in electronic form). 
2. Without prejudice to the provisions of Article s 11(1)(ii), 11bis(1)(i) and (ii), 11ter(1)(ii), 
14(1)(ii), and 14bis(1) of the Berne Convention for the Protecti on of Literary and Artistic Works  
(1971) (Berne Convention), each Party shall provide to  authors of literary and artistic works the right 
to authorize or prohibit the communication to the public  of their works, by wire or wireless means, 
including the making available to the public of thei r works in such a way that members of the public 
may access these works from a place and at a time individually chosen by them.9 
                                                      
6 Except as provided in Article 17.12(2), each Party sh all give effect to this Article upon the date of 
entry into force of this Agreement. 
7 References to “authors” in this chapter refer also to any successors in interest. 
8 With respect to copyrights and related rights in this Chapter, a right to authorize or prohibit or a right 
to authorize shall mean  an exclusive right. 
9 It is understood that the mere provision of physi cal facilities for enabling or making a communication 
does not in itself amount to communication within the meaning of this Chapter or the Berne Convention. It is 
further understood that nothing in this Artic le precludes a Party from applying Article 11 bis(2) of the Berne 
Convention.  WT/REG160/1 
 Page 173 
 
 
3. Each Party shall provide to authors of literary  and artistic works the right to authorize the 
making available to the public of the original and copies10 of their works through sale or other transfer 
of ownership. 
4. Each Party shall provide that where the term of protection of a work (including a 
photographic work) is calculated: 
(a) on the basis of the life of a natural person, th e term shall be not less than the life of 
the author and 70 years after the author’s death; and 
(b) on a basis other than the life of a natural person, the term shall be  
(i) not less than 70 years from the end of the calendar year of the first authorized 
publication of the work, or 
(ii) failing such authorized publication with in 50 years from the creation of the 
work, not less than 70 years from the end of the calendar year of the creation of the work. 
Article 17.6 
 
Related Rights
11 
 1. Each Party shall provide that performers and producers of phonograms
12 have the right to 
authorize or prohibit all reproductions of their performances or phonograms, in any manner or form, 
permanent or temporary (including temporary storage in electronic form). 
2. Each Party shall provide to performers and prod ucers of phonograms the right to authorize the 
making available to the public of the original and copies13 of their performances or phonograms 
through sale or other transfer of ownership. 
3. Each Party shall accord the rights provided under this Chapter to the performers and 
producers of phonograms who are persons of the ot her Party and to performances or phonograms first 
published or first fixed in a Party. A performance or  phonogram shall be considered first published in 
any Party in which it is published within 30 days of its original publication.14 
4. Each Party shall provide to performers the right to authorize or prohibit:  
(a) the broadcasting and communication to th e public of their unfixed performances 
except where the performance is alr eady a broadcast performance, and 
(b) the fixation of their unfixed performances. 
                                                      
10 The expressions “copies” and “original and copies”, being subject to the right of distribution under 
this paragraph, refer exclusively to fixe d copies that can be put into circulation as tangible objects, i.e., for this 
purpose, “copies” means physical copies. 
11 Except as provided in Article 17.12(2), each Party sh all give effect to this Article upon the date of 
entry into force of this Agreement. 
12 References to “performers and producers of phonog rams” in this Chapter refer also to any successors 
in interest. 
13 The expressions “copies” and “original and copies”, being subject to the right of distribution under 
this paragraph, refer exclusively to fixe d copies that can be put into circulation as tangible objects, i.e., for this 
purpose, “copies” means physical copies. 
14 For the application of Article 17.6(3), fixation means the finalization of the master tape or its 
equivalent. WT/REG160/1 
Page 174  
 
5. (a) Each Party shall provide to performer s and producers of phonograms the right to 
authorize or prohibit the broadcasting or any communication to the public of their fixed performances or phonograms, by wire or wireless means, including the making available to the public of those perform ances and phonograms in such a way that 
members of the public may access them from a place and at a time individually 
chosen by them. 
(b) Notwithstanding paragraph 5(a) and Article 17.7(3), the right to authorize or prohibit 
the broadcasting or communication to the public of performances or phonograms 
through analog communication and free over-the-air broadcasting, and the exceptions or limitations to this right for such activiti es, shall be a matter of domestic law. Each 
Party may adopt exceptions and limitations, including compulsory licenses, to the 
right to authorize or prohibit the broadcasting or communication to the public of performances or phonograms in respect of  other noninteractive transmissions in 
accordance with Article 17.7(3). Such co mpulsory licenses shall not prejudice the 
right of the performer or producer of a phonogram to obtain equitable remuneration. 
6. Neither Party shall subject the enjoyment and exercise of the rights of performers and 
producers of phonograms provided for in this Chapter to any formality. 
7. Each Party shall provide that where the term of protection of a performance or phonogram is 
to be calculated on a basis other than the lif e of a natural person, the term shall be: 
(a) not less than 70 years from the end of the calendar year of the first authorized 
publication of the performance or phonogram, or 
(b) failing such authorized publication within 50 years from the fixation of the 
performance or phonogram, not less than 70 years from the end of the calendar year 
of the fixation of the performance or phonogram. 
8. For the purposes of Articles 17.6 and 17.7, the following definitions a pply with respect to 
performers and producers of phonograms: 
(a) performers  means actors, singers, musicians, dancers, and other persons who act, 
sing, deliver, declaim, play in, interpret,  or otherwise perform literary or artistic 
works or expressions of folklore; 
(b) phonogram  means the fixation of the sounds of a performance or of other sounds, or 
of a representation of sounds, other than in the form of a fixation incorporated in a 
cinematographic or other audiovisual work;
15 
(c) fixation  means the embodiment of sounds, or of the representations thereof, from 
which they can be perceived, reproduced, or communicated through a device; 
(d) producer of a phonogram  means the person, or the le gal entity, who or which takes 
the initiative and has the responsibility for the first fixation of the sounds of a performance or other sounds, or the representations of sounds;  
                                                     
 
15 It is understood that the definition of phonogram pr ovided in this Chapter does not suggest that rights 
in the phonogram are in any way affected through their incor poration into a cinematographic or other 
audiovisual work.  WT/REG160/1 
 Page 175 
 
 
(e) publication  of a fixed performance or a phonogram  means the offering of copies of 
the fixed performance or the phonogram to the public, with the consent of the right 
holder, and provided that copies are offere d to the public in reasonable quantity; 
(f) broadcasting  means the transmission by wireless means for public reception of 
sounds or of images and sounds or of the representations thereof; such transmission 
by satellite is also broadcasting; transmi ssion of encrypted signals is broadcasting 
where the means for decrypting are provided to the public by the broadcasting organization or with its consent; and 
(g) communication to the public  of a performance or a phonogram means the 
transmission to the public by any medium, otherwise than by broadcasting, of sounds 
of a performance or the sounds or the repr esentations of sounds fixed in a phonogram. 
For the purposes of Article 17.6(5) “communication to the public” includes making the sounds or representations of sounds fixe d in a phonogram audible to the public.  
Article 17.7 
 
Obligations Common To Copyright And Related Rights
16 
 1. Each Party shall establish that in cases where aut horization is needed from both the author of 
a work embodied in a phonogram and a performer or producer owning rights in the phonogram, the need for the authorization of the author does not cease to exist because the authorization of the 
performer and producer is also required. Like wise, each Party shall establish that in cases where 
authorization is needed from both the author of a work embodied in a phonogram and a performer or 
producer owning rights in the phonogram, the need for the authorization of the performer or producer does not cease to exist because the authoriza tion of the author is also required. 
2. (a) Each Party shall provide that for copyright and related rights: 
(i) any person owning any economic right , i.e., not a moral right, may freely and 
separately transfer such right by contract; and 
(ii) any person who has acquired or owns an y such economic right by virtue of a 
contract, including contracts of employment underlying the creation of works and phonograms, shall be permitted to exer cise that right in its own name and 
enjoy fully the benefits derived from that right. 
(b) Each Party may establish: 
(i) which contracts of employment underlying the creation of works or 
phonograms shall, in the absence of a wr itten agreement, result in a transfer 
of economic rights by operation of law; and 
(ii) reasonable limits to the provisions in para graph 2(a) to protect the interests of 
the original right holders, taking into  account the legitimate interests of the 
transferees. 
3. Each Party shall confine limitations or excepti ons to rights to certain special cases which do 
not conflict with a normal exploitation of th e work, performance, or phonogram, and do not 
unreasonably prejudice the legitimate interests of the right holder.
17 
                                                      
16 Except as provided in Article 17.12(2), each Party sh all give effect to this Article upon the date of 
entry into force of this Agreement. WT/REG160/1 
Page 176  
 
4. In order to confirm that all federal or centr al government agencies use computer software 
only as authorized, each Party shall issue appropriate laws, orders, re gulations, or administrative or 
executive decrees to actively regulate the acqui sition and management of software for such 
government use. Such measures may take the form of procedures such as preparing and maintaining 
inventories of software present on agencies’ co mputers and inventories of software licenses. 
5. In order to provide adequate legal protecti on and effective legal remedies against the 
circumvention of effective technological measures th at are used by authors, performers, and producers 
of phonograms in connection with the exercise of th eir rights and that restrict unauthorized acts in 
respect of their works, performances, and phonogr ams, protected by copyright and related rights: 
(a) each Party shall provide that  any person who knowingly
18 circumvents without 
authorization of the right holder or law cons istent with this Agreement any effective 
technological measure that controls access to a protected work, performance, or phonogram shall be civilly liable and, in appropriate circumstances, shall be criminally liable, or said conduct shall be  considered an aggravating circumstance of 
another offense.
19 No Party is required to impose civil or criminal liability for a 
person who circumvents any effective technol ogical measure that protects any of the 
exclusive rights of copyright or related rights in a protected work, but does not control access to such work. 
(b) each Party shall also provide administrative or civil measures, and, where the conduct 
is willful and for prohibited commercial purposes, criminal measures with regard to the manufacture, import, distribution, sal e, or rental of devices, products, or 
components or the provision of services which: 
(i) are promoted, advertised, or marketed for the purpose of circumvention of 
any effective technological measure, or 
(ii) do not have a commercially significant purpose or use other than to 
circumvent any effective technological measure, or 
(iii) are primarily designed, produced, adapted, or performed for the purpose of 
enabling or facilitating the circumvention of any effective technological measures. 
                                                                                                                                                                    
 
17 Article 17.7(3) permits a Party to carry forward and appropriately extend into the digital environment 
limitations and exceptions in its domestic laws whic h have been considered acceptable under the Berne 
Convention. Similarly, these provisions permit a Party to devise new exceptions and limitations that are appropriate in the digital network environment. For works, other than computer software, and other subject 
matter, such exceptions and limitations may include temporary acts of reproduction which are transient or 
incidental and an integral and essentia l part of a technological process and wh ose sole purpose is to enable (a) a 
lawful transmission in a network between third parties by an intermediary; or (b) a lawful use of a work or other 
subject-matter to be made; and which have no independent economic significance.  
Article 17.7(3) neither reduces nor extends the scope of applicability of the limitations and exceptions 
permitted by the Berne Convention, the WIPO Copyright Treaty  (1996), and the WIPO Performances and 
Phonograms Treaty (1996). 
18 For purposes of paragraph 5, knowledge may be demonstrated through reasonable evidence taking 
into account the facts and circumstances surrounding the alleged illegal act. 
19 Paragraph 5 does not obligate a Party to require th at the design of, or the design and selection of 
parts and components for, a consumer electronics, telecommunications, or computing product provide for a 
response to any particular  technological measure, so long as su ch product does not otherwise violate any 
measure implementi ng paragraph 5(b).  WT/REG160/1 
 Page 177 
 
 
Each Party shall ensure that due account is given, inter alia , to the scientific or 
educational purpose of the conduct of the de fendant in applying criminal measures 
under any provisions implementing this subparagraph. A Party may exempt from criminal liability, and if carried out in good faith without knowledge that the conduct 
is prohibited, from civil liability, acts pr ohibited under this subparagraph that are 
carried out in connection with a nonprofit library, archive or educational institution. 
 
(c) Each Party shall ensure that nothing in subparagraphs (a) and (b) affects rights, 
remedies, limitations, or defenses with respect to copyright or related rights infringement. 
(d) Each Party shall confine limitations a nd exceptions to measures implementing 
subparagraphs (a) and (b) to certain special cases that do not impair the adequacy of 
legal protection or the effectiveness of legal remedies against the circumvention of effective technological measures. In particular, each Party may establish exemptions and limitations to address the following s ituations and activities in accordance with 
subparagraph (e): 
(i) when an actual or likely adverse effect  on noninfringing uses with respect to 
a particular class of works or exceptions or limitation to copyright or related rights with respect to a class of users is demonstrated or recognized through a legislative or administrative proceeding established by law, provided that any limitation or exception adopted in relia nce upon this subparagraph (d)(i) shall 
have effect for a period of not more than three years from the date of 
conclusion of such proceeding; 
(ii) noninfringing reverse engineering activ ities with regard to a lawfully 
obtained copy of a computer program, carried out in good faith with respect to particular elements of that comput er program that have not been readily 
available to that person,
20 for the sole purpose of achieving interoperability of 
an independently created computer program with other programs;21 
(iii) noninfringing good faith activities, carried out by a researcher who has 
lawfully obtained a copy, performance, or display of a work, and who has made a reasonable attempt to obtain aut horization for such activities, to the 
extent necessary for the sole purpose of identifying and analyzing flaws and 
vulnerabilities of encryption technologies;
22 
(iv) the inclusion of a component or part for the sole purpose of preventing the 
access of minors to inappropriate onlin e content in a technology, product, 
service, or device that does not itself violate any measures implementing subparagraphs (a) and (b); 
(v) noninfringing good faith activities that are authorized by the owner of a 
computer, computer system, or computer network for the sole purpose of 
                                                     
 
20 For greater certainty, elements of  a computer program are not readily available to a person seeking to 
engage in noninfringing reverse engineering when they cannot be obtained from th e literature on  the subject, 
from the copyright holder, or from sources in the public domain. 
21 Such activity occurring in the course of research and development is not excluded from this 
exception. 
22 Such activity occurring in the course of research and development is not excluded from this  
exception. WT/REG160/1 
Page 178  
 
testing, investigating, or correcting the security of that computer, computer system, or computer network; 
(vi) noninfringing activities for the sole purpose of identifying and disabling a 
capability to carry out undisclosed collection or dissemination of personally identifying information reflecting the on line activities of a natural person in a 
way that has no other effect on the ability  of any person to gain access to any 
work; 
(vii) lawfully authorized activities carried out by government employees, agents, 
or contractors for the purpose of law enforcement, intelligence, or similar government activities; and 
(viii) access by a nonprofit library, archive, or  educational institution to a work not 
otherwise available to it, for the sole  purpose of making acquisition decisions. 
(e) Each Party may apply the exceptions and lim itations for the situations and activities 
set forth in subparagraph (d) as follows: 
(i) any measure implementing subparagraph (a ) may be subject to the exceptions 
and limitations with respect to each  situation and activity set forth in 
subparagraph (d). 
(ii) any measure implementing subparagraph (b), as it applies to effective 
technological measures that control access to a work, may be subject to exceptions and limitations with respect to the activities set forth in subparagraphs (d)(ii), (iii), (iv), (v), and (vii). 
(iii) any measure implementing subparagraph (b), as it applies to effective 
technological measures that protect any copyright or any rights related to copyright, may be subject to exceptions and limitations with respect to the activities set forth in subparagraph (d)(ii) and (vii). 
(f) Effective technological measure means any technology, device, or component that, 
in the normal course of its operation, controls access to a work, performance, 
phonogram, or any other protected material, or that protects any copyright or any rights related to copyright, and cannot, in the usual case, be circumvented accidentally. 
6. In order to provide adequate and effective legal remedies to protect rights management 
information: 
(a) each Party shall provide that any person who without authority, and knowing, or, with 
respect to civil remedies, having reasona ble grounds to know, that it will induce, 
enable, facilitate, or conceal an infringement of any copyright or related right, 
(i) knowingly removes or alters any rights management information; 
(ii) distributes or imports for distribution rights management information 
knowing that the rights management information has been altered without 
authority; or 
(iii) distributes, imports for distribution, broadcasts, communicates, or makes 
available to the public copies of works or phonograms, knowing that rights  WT/REG160/1 
 Page 179 
 
 
management information has been remove d or altered without authority, shall 
be liable, upon the suit of any injured person, and subject to the remedies in Article 17.11(5). Each Party shall pr ovide for application of criminal 
procedures and remedies at least in cases where acts prohibited in the subparagraph are done willfully and fo r purposes of commercial advantage. 
A Party may exempt from criminal liability prohibited acts done in 
connection with a nonprofit library, ar chive, educational institution, or 
broadcasting entity established without a profit-making purpose. 
(b) Rights management information  means: 
(i) information which identifies a work, pe rformance, or phonogram; the author 
of the work, the performer of the performance, or the producer of the 
phonogram; or the owner of any right in the work, performance, or phonogram; 
(ii) information about the terms and conditions of the use of the work, 
performance, or phonogram; and  
(iii) any numbers or codes that represent such information, 
when any of these items is attached to  a copy of the work, performance, or 
phonogram or appears in conjunction with the communication or making available of a work, performance, or phonogram to the public. Nothing in paragraph 6(a) requires the owner of any right in the work, performance, or phonogram to attach rights management information to copies of the owner’s work, performance, or phonogram 
or to cause rights management information to appear in connection with a 
communication of the work, performance, or phonogram to the public.  
7. Each Party shall apply Article 18 of the Berne Convention, mutatis mutandis , to all the 
protections of copyright and related rights and effective technological measures and rights 
management information in Articles 17.5, 17.6, and 17.7. 
Article 17.8 
 
Protection Of Encrypted Program-Carrying Satellite Signals
 
 1. Each Party shall make it: 
(a) a civil or criminal offense to manufacture, assemble, modify, import, export, sell, 
lease, or otherwise distribute a tangible or intangible device or system, knowing
23 that 
the device or system’s principal function is solely to assist in decoding an encrypted 
program-carrying satellite signal without the au thorization of the lawful distributor of 
such signal; and 
(b) a civil or criminal offense willfully to receive or further distribute an encrypted 
program-carrying satellite signal knowing that it has been decoded without the authorization of the lawful distributor of the signal. 
2. Each Party shall provide that any person injure d by any activity described in subparagraphs 
1(a) or 1(b), including any person that holds an interest in the encrypted programming signal or the 
                                                     
 
23 For purposes of paragraph 1, knowledge may be demonstrated through reasonable evidence, taking 
into account the facts and circumstances surrounding the alleged illegal act. WT/REG160/1 
Page 180  
 
content of that signal, shall be permitted to in itiate a civil action under any measure implementing 
such subparagraphs. 
Article 17.9 
 
Patents
 
 
1. Each Party shall make patents available for an y invention, whether a product or a process, in 
all fields of technology, provided that the invention is new, involves an inventive step, and is capable 
of industrial application. For purposes of this Articl e, a Party may treat the terms “inventive step” and 
“capable of industrial application” as being synony mous with the terms “non-obvious” and “useful”, 
respectively. 
2. Each Party will undertake reasonable efforts, th rough a transparent and participatory process, 
to develop and propose legislation within 4 years fr om the entry into force of this Agreement that 
makes available patent protection for plants that are new, involve an inventive step, and are capable of 
industrial application.  
3. Each Party may provide limited exceptions to  the exclusive rights conferred by a patent, 
provided that such exceptions do not unreasonably c onflict with a normal exploitation of the patent 
and do not unreasonably prejudice the legitimate inter ests of the patent owner, taking account of the 
legitimate interests of third parties.  
4. If a Party permits the use by a third party of the subject matter of a subsisting patent to 
support an application for marketing approval or sanitary permit of a pharmaceutical product, the 
Party shall provide that any product produced under su ch authority shall not be made, used, or sold in 
the territory of the Party other than for purpo ses related to meeting requirements for marketing 
approval or the sanitary permit, and if export is permitted, the product shall only be exported outside 
the territory of the Party for purposes of meeting requirements for issuing marketing approval or sanitary permits in the exporting Party.  
5. A Party may revoke or cancel a patent only when  grounds exist that would have justified a 
refusal to grant the patent.
24 
6. Each Party shall provide for the adjustment of the term of a patent, at the request of the patent 
owner, to compensate for unreasonable delays that occur in granting the patent. For the purposes of 
this paragraph, an unreasonable de lay shall be understood to include a delay in the issuance of the 
patent of more than five years from the date of f iling of the application in the Party, or three years 
after a request for examination of the application h as been made, whichever is later, provided that 
periods of time attributable to acti ons of the patent applicant need not  be included in the determination 
of such delays. 
7. Neither Party shall use a public disclosure to ba r patentability based upon a lack of novelty or 
inventive step if the public disclosure (a) was made  or authorized by, or derived from, the patent 
applicant and (b) occurs within 12 months prior to the date of filing of the application in the Party. 
Article 17.10 
 
Measures Related To Certain Regulated Products  
 1. If a Party requires the submission of undisclosed information concerning the safety and 
efficacy of a pharmaceutical or agricultural chemic al product which utilizes a new chemical entity, 
                                                     
 
24 Fraud in obtaining a patent may constitute grounds for revocation or cancellation.  WT/REG160/1 
 Page 181 
 
 
which product has not been previously approved, to  grant a marketing approval or sanitary permit for 
such product, the Party shall not permit third parti es not having the consent of the person providing 
the information to market a product based on this new chemical entity, on the basis of the approval 
granted to the party submitting such information. A Party shall maintain this prohibition for a period 
of at least five years from the date of approval for a pharmaceutical product and ten years from the 
date of approval for an agricultural chemical product.25 Each Party shall protect such information 
against disclosure except where necessary to protect the public. 
2. With respect to pharmaceutical products that are subject to a patent, each Party shall: 
(a) make available an extension of the patent term to compensate the patent owner for 
unreasonable curtailment of the patent te rm as a result of the marketing approval 
process; 
(b) make available to the patent owner the identity of any third party requesting 
marketing approval effective during the term of the patent; and  
(c) not grant marketing approval to any third party prior to the expiration of the patent 
term, unless by consent or acquiescence of the patent owner.  
Article 17.11 
 
Enforcement Of Intellectual Property Rights  
 
General Obligations 
 1. Each Party shall ensure that procedures and reme dies set forth in this Article for enforcement 
of intellectual property rights are establishe d in accordance with its domestic law.
26 Such 
administrative and judicial procedures and remedies, both civil and criminal, shall be made available 
to the holders of such rights in accordance with  the principles of due process that each Party 
recognizes as well as with the founda tions of its own legal system.  
2. This Article does not create any obligation: 
(a) to put in place a judicial system for the enforcement of intellectual property rights 
distinct from that already existing for the enforcement of law in general, or 
(b) with respect to the distribution of res ources for the enforcement of intellectual 
property rights and the enforcement of law in general. 
The distribution of resources for the enforcement of  intellectual property rights shall not excuse a 
Party from compliance with the provisions of this Article. 
 3. Final decisions on the merits of a case of genera l application shall be in writing and shall state 
the reasons or the legal basis upon which decisions are based. 
                                                     
 
25 Where a Party, on the date of its implementation of the TRIPS Agreement, had in place a system for 
protecting pharmaceutical or agricultural chemical pro ducts not involving new chemical entities from unfair 
commercial use which conferred a period of protection shorter than that specified in paragraph 1, that Party may 
retain such system notwithstanding the obligations of paragraph 1. 
26 Nothing in this Chapter prevents a Party from establishing or maintaining appropriate judicial or 
administrative procedural formalities for this purpose that do not impair  each Party’s rights and obligations 
under this Agreement. WT/REG160/1 
Page 182  
 
4. Each Party shall publicize or make available to  the public information that each Party might 
collect regarding its efforts to provide effective en forcement of intellectual property rights, including 
statistical information. 
5. Each Party shall make available the civil reme dies set forth in this Article for the acts 
described in the Articles 17.7(5) and 17.7(6). 
6. In civil, administrative, and criminal proceedings involving copyright or related rights, each 
Party shall provide that: 
(a) the natural person or legal entity whose name is indicated as the author, producer, 
performer, or publisher of the work, pe rformance, or phonogram in the usual 
manner,
27 shall, in the absence of proof to the contrary, be presumed to be the 
designated right holder in such work, performance, or phonogram.  
(b) it shall be presumed, in the absence of proof to the contrary, that the copyright or 
related right subsists in such subject ma tter. A Party may require, as a condition for 
according such presumption of subsistence, that the work appear on its face to be 
original and that it bear a publication date not more than 70 years prior to the date of 
the alleged infringement. 
Civil And Administrative Procedures28 And Remedies 
 
7. Each Party shall make available to right holders29 civil judicial procedures concerning the 
enforcement of any intellectual property right. 
8. Each Party shall provide that: 
(a) In civil judicial proceedings, the judicial authorities shall have the authority to order 
the infringer to pay the right holder: 
(i) damages adequate to compensate for th e injury the right holder has suffered 
because of an infringement of that person’s intellectual property right by an infringer engaged in infringing activity, and 
(ii) at least in the case of infringements of tr ademark, copyright, or related rights, 
the profits of the infringer that are attributable to the infringement and are not already taken into account in determining injury.  
(b) In determining injury to the right holder, the judicial authorities shall, inter alia , 
consider the legitimate retail value of the infringed goods.  
9. In civil judicial proceedings, each Party shall, at least with respect to works protected by 
copyright or related rights and trademark counterfe iting, establish pre-established damages, prescribed 
by each Party’s domestic law, that the judicial aut horities deem reasonable in light of the goals of the 
intellectual property system and the objectives set forth in this Chapter. 
                                                     
 
27 Each Party may establish the means by which it shall determine what constitutes the “usual manner” 
for a particular physical support. 
28 For the purposes of this Article, civil judicial procedures mean those procedures as applied to the 
protection and enforcement of intellectual property rights. 
29 For the purposes of this Article, the term “right holder” shall include duly authorized licensees as 
well as federations and associations having legal standing and authorization to assert such rights.  WT/REG160/1 
 Page 183 
 
 
10. Each Party shall provide that, except in excep tional circumstances, its judicial authorities 
have the authority to order, at the conclusion of civil judicial pr oceedings concerning infringement of 
copyright or related rights and trad emark counterfeiting, that the prev ailing right holder shall be paid 
the court costs or fees and reasonable at torney’s fees by the infringing party. 
11. In civil judicial proceedings concerning co pyright and related ri ghts infringement and 
trademark counterfeiting, each Party shall provide that  its judicial authorities shall have the authority 
to order the seizure of suspected infringing goods, an d of material and implements by means of which 
such goods are produced where necessary to prevent further infringement. 
12. In civil judicial proceedings, each Party shall provide that: 
(a) its judicial authorities shall have the aut hority to order, at their discretion, the 
destruction, except in exceptional cases, of the goods determined to be infringing 
goods; 
(b) the charitable donation of goods that infringe copyright and related rights shall not be 
ordered by the judicial authorities without the authorization of the right holder other than in special cases that do not conflict with the normal exploitation of the work, 
performance, or phonogram, and do not unreasonably prejudice the legitimate 
interests of the right holder; 
(c) the judicial authorities shall have the authority to order, at their discretion, that 
material and implements actually used in the manufacture of the infringing goods be 
destroyed. In considering such requests, the judicial authorities shall take into 
account, inter alia , the need for proportionality between the gravity of the 
infringement and remedies ordered, as well as  the interests of third parties holding an 
ownership, possessory, contractual, or secured interest; and 
(d) in regard to counterfeited trademarked goo ds, the simple removal of the trademark 
unlawfully affixed shall not permit releas e of the goods into the channels of 
commerce. However, such goods may be donate d to charity when the removal of the 
trademark eliminates the infringing characteristic of the good and the good is no 
longer identifiable with the removed trademark. 
13. In civil judicial proceedings, each Party shall pr ovide that the judicial authorities shall have 
the authority to order the infringer to provide any information the infringer may have regarding 
persons involved in the infringeme nt, and regarding the distribution channels of infringing goods. 
Judicial authorities shall also have the authority to impose fines or imprisonment on infringers who do 
not comply with such orders, in acco rdance with each Party’s domestic law. 
14. To the extent that any civil remedy can be ordered as a result of administrative procedures on 
the merits of a case, such procedures shall conform to principles equivalent in substance to those set 
forth in paragraphs 1 through 13. 
Provisional Measures 
 
15. Each Party shall provide that requests for relief inaudita altera parte  shall be acted upon 
expeditiously in accordance w ith the judicial procedural rules of that Party. 
16. 
Each Party shall provide that: 
(a) its judicial authorities have the authority to  require the applicant for any provisional 
measure to provide any reasonably available evidence in order to satisfy themselves WT/REG160/1 
Page 184  
 
to a sufficient degree of certainty that the applicant is the holder of the right in 
question
30 and that infringement of such right is imminent, and to order the applicant 
to provide a reasonable security or equi valent assurance in an amount that is 
sufficient to protect the defendant and prev ent abuse, set at a level so as not to 
unreasonably deter recourse to such procedures. 
(b) in the event that judicial or other authorities appoint experts, technical or otherwise, 
that must be paid by the parties, such co sts shall be set at a reasonable level taking 
into account the work performed, or if a pplicable, based on standardized fees, and 
shall not unreasonably deter recourse to provisional relief. 
Special Requirements Related To Border Measures 
 
17. Each Party shall provide that any right holde r initiating procedures for suspension by the 
customs authorities of the release of suspected counterfeit trademark or pirated copyright goods31 into 
free circulation is required to provide adequate evidence to satisfy the co mpetent authorities that, 
under the laws of the Party of importation, there is  prima facie an infringement of the right holder’s 
intellectual property right and to supply suffici ent information to make the suspected goods 
reasonably recognizable to the customs authorities.  The sufficient information required shall not 
unreasonably deter recourse to these procedures. 
18. Each Party shall provide the competent authoriti es with the authority to require an applicant 
to provide a reasonable security or equivalent assu rance sufficient to protect the defendant and the 
competent authorities and to prevent abuse. Such security or equivalent assurance shall not 
unreasonably deter recourse to these procedures. 
19. Where the competent authorities have made a determination that goods are counterfeit or 
pirated, a Party shall grant the competent authorities the authority to inform the right holder, at the 
right holder’s request, of the names and addresses of the consignor, the importer, and the consignee, 
and of the quantity of the goods in question.  
20. Each Party shall provide that the competent authorities are permitted to initiate border 
measures ex officio , without the need for a formal compla int from a person or right holder. Such 
measures shall be used when there is reason to belie ve or suspect that goods being imported, destined 
for export, or moving in transit are counterfeit or pi rated. In case of goods in transit, each Party, in 
conformity with other international agreemen ts subscribed to by it, may provide that ex officio  
                                                      
30 In accordance with the pr ovisions in paragraph 6(a). 
31 For the purposes of paragraphs 17 through 19: 
 (a) counterfeit trademark goods  means any goods, including packaging, bearing without 
authorization a trademark which is identical to the trademark validly regi stered in respect of 
such goods, or which cannot be distinguished in its essential aspects from such a trademark, and which thereby infringes the rights of the owner of the trademark in question under the law 
of the country of importation; 
(b) pirated copyright goods  means any goods which are copies made without the consent of the 
right holder or person duly authorized by the right holder in the country of production and 
which are made directly or indirectly from an article where the making of that copy would 
have constituted an infringement of a copyright or a related right under the law of the country 
of importation.   WT/REG160/1 
 Page 185 
 
 
authority shall be exercised prior to sealing the co ntainer, or other means of conveyance, with the 
customs seal, as applicable.32 
21. Each Party shall provide that: 
(a) goods that have been found to be pirated or counterfeit by the competent authorities 
shall be destroyed, ex cept in exceptional cases. 
(b) in regard to counterfeit trademark goods , the simple removal of the trademark 
unlawfully affixed shall not be sufficient to permit the release of goods into the 
channels of commerce. 
(c) in no event shall the competent authorities e ngage in, or permit, the re-exportation of 
counterfeit or pirated goods, nor shall they permit such goods to be subject to other 
customs procedures. 
Criminal Procedures And Remedies 
 
22. Each Party shall provide for application of cr iminal procedures and penalties at least in cases 
of willful trademark counterfeiting or piracy, on a commercial scale, of works, performances, or 
phonograms protected by copyright or related rights. Specifically, each Party shall ensure that: 
(a) (i) willfull infringement33 of copyright and relate d rights for a commercial 
advantage or financial gain, is subject  to criminal procedures and penalties;34 
(ii) copyright or related rights piracy on a commercial scale includes the willful 
infringing reproduction or distribution, including by electronic means, of copies with a significant aggregate monetary value, calculated based on the 
legitimate retail value of the infringed goods; 
(b) available remedies include sentences of imprisonment and/or monetary fines that are 
sufficient to provide a deterrent to futu re infringements and present a level of 
punishment consistent with the gravity of th e offense, which shall be applied by the 
judicial authorities in light of, inter alia , these criteria; 
(c) judicial authorities have the authority to or der the seizure of suspected counterfeit or 
pirated goods, assets legally traceable to the infringing activity, documents and 
related materials, and implements that cons titute evidence of the offense. Each Party 
shall further provide that its judicial authorities have the authority to seize items in accordance with its domestic law. Items th at are subject to seizure pursuant to a 
search order need not be individually identified so long as they fall within general 
categories specified in the order;  
(d) judicial authorities have the authority to order, among other measures, the forfeiture 
of any assets legally traceable to the in fringing activity, and the forfeiture and 
destruction of all counterfeit a nd pirated goods and, at least with respect to copyright 
                                                     
 
32 The Parties recognize their obligations with resp ect to technological cooperation and other matters 
set forth in Chapter Five (Customs Administration), concerning, inter alia , improved customs enforcement, 
including with respect to in tellectual property rights. 
33 For purposes of paragraph 22, evidence of reproduction or distribution of a copyrighted work, by 
itself, shall not be sufficient to establish wilful infringement. 
34 For purposes of paragraph 22, commercial advantag e or financial gain shall be understood to exclude 
de minimis  infringements. Nothing in this Agreement preven ts prosecutors from exercising any discretion that 
they may have to decline to pursue cases. WT/REG160/1 
Page 186  
 
and related rights piracy, any related materials and implements actually used in the 
manufacture of the pirated goods. Parties sh all not make compensation available to 
the infringer for any such forfeiture or destruction; and 
(e) Appropriate authorities, as determined by each  Party, have the authority, in cases of 
copyright and related rights piracy and tr ademark counterfeiting, to exercise legal 
action ex officio  without the need for a formal complaint by a person or right holder. 
Limitations On Liability For Internet Service Providers 
 
23. (a) For the purpose of providing enforcemen t procedures that permit effective action 
against any act of infringement of copyright
35 covered under this Chapter, including 
expeditious remedies to prevent infringements and criminal and civil remedies, each 
Party shall provide, consistent with th e framework set forth in this Article: 
(i) legal incentives for service providers to cooperate with copyright owners in 
deterring the unauthorized storage and tr ansmission of copyrighted materials; 
and 
(ii) limitations in its law regarding the scope of remedies available against 
service providers for copyright infringements that they do not control, initiate, or direct, and that take place through systems or networks controlled 
or operated by them or on their behalf, as set forth below. 
(b) These limitations shall preclude monetary re lief and provide reasonable limitations on 
court-ordered relief to compel or restrain  certain actions for the following functions 
and shall be confined to those functions: 
(i) transmitting, routing, or providing connections for material without 
modification of its content;
36 
(ii) caching carried out through an automatic process; 
(iii) storage at the direction of a user of material residing on a system or network 
controlled or operated by or for the provider, including e-mails and its 
attachments stored in the provider’s server, and web pages residing on the provider’s server; and 
(iv) referring or linking users to an online location by using information location 
tools, including hyperlinks and directories. 
These limitations shall apply only wher e the provider does not initiate the 
transmission, or select the material or its recipients (except to the extent that a 
function described in subparagraph (iv) in itself entails some form of selection). This paragraph does not preclude the availab ility of other defenses to copyright 
infringement that are of general applicabilit y, and qualification for the limitations as 
to each function shall be considered separately from qualification for the limitations 
as to other functions. 
 
                                                     
 
35 For purposes of paragraph 23, “copyright” shall also include related rights. 
36 Modification of the content of material shall not include technological manipulation of material for 
the purpose of facilitating ne twork transmission, such as division into packets.  WT/REG160/1 
 Page 187 
 
 
(c) With respect to function (b)(ii), the lim itations shall be conditioned on the service 
provider: 
(i) complying with conditions on user access and rules regarding the updating of 
the cached material imposed by the supplier of the material; 
(ii) not interfering with technology consistent with widely accepted industry 
standards lawfully used at the originatin g site to obtain information about the 
use of the material, and not modifying its content in transmission to subsequent users; and 
(iii) expeditiously removing or disabling access, upon receipt of an effective 
notification of claimed infringement in  accordance with subparagraph (f), to 
cached material that has been remove d or access to which has been disabled 
at the originating site. 
With respect to functions (b)(iii) and (iv) , the limitations shall be conditioned on the 
service provider: 
 
(i) not receiving a financial benefit directly attributable to the infringing activity, 
in circumstances  where it has the right  and ability to control such activity; 
(ii) expeditiously removing or disabling access to the material residing on its 
system or network upon obtaining actual knowledge of the infringement or becoming aware of facts or circumstances from which the infringement was apparent, including through effective notif ications of claimed infringement in 
accordance with subparagraph (f); and 
(iii) publicly designating a representative to receive such notifications. 
(d) Eligibility for application of the limitations in this paragraph shall be conditioned on 
the service provider: 
(i) adopting and reasonably implementing
37 a policy that provides for 
termination in appropriate circumstance s of the accounts of repeat infringers; 
and 
(ii) accommodating and not interfering with standard technical measures that 
lawfully protect and identify copyrighted material, that are developed through an open, voluntary process by a broad consensus of interested parties, approved by relevant authorities, as applicable, that are available on 
reasonable and nondiscriminatory terms,  and that do not impose substantial 
costs on service providers or substantial burdens on their systems or networks. 
Eligibility for application of the limitations in this paragraph may not be conditioned 
on the service provider monitoring its service, or affirmatively seeking facts 
indicating infringing activity, except to the extent consistent with such technical 
measures.  
                                                     
 
37 A Party may determine in its domestic law that “reasonably implementing” entails, inter alia , 
making such policy continuously available to its users of its system or network. WT/REG160/1 
Page 188  
 
(e) If the service provider qualifies for the limitation with respect to function (b)(i), 
court-ordered relief to compel or restrain certain actions shall be limited to measures to terminate specified accounts, or to take reasonable steps to block access to a 
specific, non-domestic online location. If the service provider qualifies for the limitations with respect to any other functi on in subparagraph (b),  court-ordered relief 
to compel or restrain certain actions shall be limited to removing or disabling access 
to the infringing material, terminating speci fied accounts, and other remedies that a 
court may find necessary provided that such other remedies are the least burdensome to the service provider and users or subscrib ers among comparably effective forms of 
relief. Any such relief shall be issued with  due regard for the relative burden to the 
service provider, to users or subscribers and harm to the copyright owner, the 
technical feasibility and effectiveness of the remedy and whether less burdensome, 
comparably effective enforcement methods are available. Except for orders ensuring 
the preservation of evidence, or other orders having no material adverse effect on the operation of the service provider’s communica tions network, such relief shall be 
available only where the service provider has received notice and an opportunity to 
appear before the judicial authority. 
(f) For purposes of the notice and take down process for functions (b)(ii), (iii), and (iv), 
each Party shall establish appropriate pro cedures through an open and transparent 
process which is set forth in domestic law, for effective notifications of claimed infringement, and effective counter-notificati ons by those whose material is removed 
or disabled through mistake or misidentification. At a minimum, each Party shall 
require that an effective notification of claimed infringement be a written communication, physically or electronically
38 signed by a person who represents, 
under penalty of perjury or other criminal  penalty, that he is an authorized 
representative of a right holder in the material that is claimed to have been infringed, 
and containing information that is reasona bly sufficient to enable the service provider 
to identify and locate material that the co mplaining party claims in good faith to be 
infringing and to contact that complaining party. At a minimum, each Party shall require that an effective counter-notif ication contain the same information, mutatis 
mutandis , as a notification of claimed infringement, and in addition, contain a 
statement that the subscriber making th e counter-notification consents to the 
jurisdiction of the courts of the Party. Each Party shall also provide for monetary 
remedies against any person who makes a knowing material misrepresentation in a 
notification or counter-notification which causes injury to any interested party as a result of a service provider relying on the misrepresentation. 
(g) If the service provider removes or disables access to material in good faith based on 
claimed or apparent infringement, it shall be exempted from liability for any resulting 
claims, provided that, in the case of material residing on its system or network, it takes reasonable steps promptly to notify th e supplier of the material that it has done 
so and, if the supplier makes an effectiv e counter-notification and is subject to 
jurisdiction in an infringement suit, to r estore the material online unless the original 
notifying party seeks judicial relief within a reasonable time. 
(h) Each Party shall establish an administrative or judicial procedure enabling copyright 
owners who have given effective notifi cation of claimed infringement to obtain 
expeditiously from a service provider information in its possession identifying the alleged infringer. 
                                                     
 
38 In accordance with domestic law.  WT/REG160/1 
 Page 189 
 
 
(i) Service provider  means, for purposes of function (b)(i), a provider of transmission, 
routing, or connections for digital onli ne communications without modification of 
their content between or among points specified by the user of material of the user’s choosing, or for purposes of functions (b)(ii) through (iv) a provider or operator of facilities for online services (including in cases where network access is provided by 
another provider) or network access. 
Article 17.12 
 
Final Provisions
 
 
1. Except as otherwise provided in this Chapter, each Party shall give effect to the provisions of 
this Chapter upon the date of entry into force of this Agreement. 
2. In those cases in which the full implementation of  the obligations contained in this Chapter 
requires a Party to amend its domestic legislation or  additional financial res ources, those amendments 
and financial resources shall be in force or availa ble as soon as practicable, and in no event later than: 
(a) two years from the date of entry into force of this Agreement, with respect to the 
obligations in Article 17.2 on trademarks, Article 17.4(1) through17.4(9) on geographical indications, Article 17.9(1), 17.9(3) through 17.9(7) on patents, and 
Articles 17.5(1) and 17.6(1) on temporary copies;  
(b) four years from the date of entry into for ce of this Agreement, with respect to the 
obligations in Article 17.11 on enforcemen t (including border measures), and Article 
17.6(5) with respect to the right of comm unication to the public, and non-interactive 
digital transmissions, for performers and producers of phonograms; and 
(c) five years from the date of entry into for ce of this Agreement, with respect to the 
obligations in Article 17.7(5) on effective technological measures. 
 
CHAPTER EIGHTEEN : LABOR 
 
Article 18.1 
 
Statement Of Shared Commitment
 
 
1. The Parties reaffirm their obligations as members of the International Labor Organization  
(ILO) and their commitments under the ILO Declaration on Fundamental Principles and Rights at 
Work and its Follow-up  (1998). Each Party shall strive to ensure that such labor principles and the 
internationally recognized labor rights set forth in  Article 18.8 are recognized and protected by its 
domestic law. 
2. Recognizing the right of each Party to establis h its own domestic labor standards, and to 
adopt or modify accordingly its labor laws, each Party shall strive to ensure that its laws provide for 
labor standards consistent with th e internationally recognized labor ri ghts set forth in Article 18.8 and 
shall strive to improve those standards in that light.  
 
 
 
  WT/REG160/1 
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Article 18.2 
 
Enforcement Of Labor Laws
 
 1. (a) A Party shall not fail to effectively enfo rce its labor laws, through a sustained or 
recurring course of action or inaction, in a manner affecting trade between the Parties, 
after the date of entry into force of this Agreement. 
(b) The Parties recognize that each Party retains the right to exercise discretion with 
respect to investigatory, prosecutorial, regulatory, and compliance matters and to 
make decisions regarding the allocation of resources to enforcement with respect to 
other labor matters determined  to have higher priorities. Accordingly, the Parties 
understand that a Party is in compliance with subparagraph (a) where a course of 
action or inaction reflects a reasonable exercise of such discretion, or results from a bona fide  decision regarding the allocation of resources. 
2. The Parties recognize that it is inappropriate to  encourage trade or investment by weakening 
or reducing the protections afforded in domestic la bor laws. Accordingly, each Party shall strive to 
ensure that it does not waive or otherwise derogate  from, or offer to waive or otherwise derogate 
from, such laws in a manner that weakens or reduces adherence to th e internationally recognized labor 
rights referred to in Article 18.8 as an encouragem ent for trade with the other Party, or as an 
encouragement for the establishment, acquisition, expa nsion, or retention of an investment in its 
territory.  
3. Nothing in this Chapter shall be construed to empower a Party’s authorities to undertake labor 
law enforcement activities in the territory of the other Party. 
Article 18.3 
 
Procedural Guarantees And Public Awareness
 
 
1. Each Party shall ensure that persons with a legally recognized interest under its law in a 
particular matter have appropriate access to judicial  tribunals of general, labor or other specific 
jurisdiction, quasi-judicial tribunals, or administra tive tribunals, as appropriate, for the enforcement of 
the Party’s labor laws. 
2. Each Party shall ensure that its proceedings fo r the enforcement of its labor laws are fair, 
equitable, and transparent. 
3. Each Party shall provide that the parties to su ch proceedings may seek remedies to ensure the 
enforcement of their rights under domestic labor laws. 
4. For greater certainty, decisions by each Party’s judicial tribunals of general, labor, or other 
specific jurisdiction, quasi-judicial tribunals, or administrative tribunals, as appropriate, or pending 
decisions, as well as related proceedings, shall not be subject to revision or reopened under the 
provisions of this Chapter. 
5. Each Party shall promote public awareness of its labor laws. 
 
  
 
  WT/REG160/1 
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Article 18.4 
 
Labor Affairs Council  
 1. The Parties hereby establish a Labor Affairs C ouncil, comprising cabinet-level or equivalent 
representatives of the Parties, or their designees. 
2. The Council shall meet within the first year after the date of entry into force of this 
Agreement and thereafter as often as it considers necessary to oversee the implementation of and review progress under this Chapter, including th e activities of the Labor Cooperation Mechanism 
established under Article 18.5, and to pursue the la bor objectives of this Agreement. Each meeting of 
the Council shall include a public session, unless the Parties otherwise agree. 
3. Each Party shall designate an office within its labor ministry that shall serve as a point of 
contact with the other Party, and with the public, for purposes of carrying out the work of the Council. 
4. The Council shall establish its work program a nd procedures and may, in carrying out its 
work, establish governmental working or expert groups and consult with or seek advice of non-
governmental organizations or persons , including independent experts.  
5. All decisions of the Council shall be taken by mutual agreement of the Parties and shall be 
made public, unless the Council decides otherwise.  
6. Each Party may convene a national consultativ e or advisory committee, as appropriate, 
comprising members of its public, including repr esentatives of its labor and business organizations 
and other persons to provide views regard ing the implementation of this Chapter. 
7. Each Party’s point of contact shall provide for the submission, receipt, and consideration of 
public communications on matters related to this  Chapter, and shall make such communications 
available to the other Party and the public. Each Party shall review such communications, as appropriate, in accordance with its domestic procedures.  
Article 18.5 
 
Labor Cooperation Mechanism
 
  Recognizing that cooperation provides enhan ced opportunities for the Parties to promote 
respect for the principles embodied in the ILO Declaration on Fundamental Principles and Rights at 
Work and its Follow-up  (1998), compliance with ILO Convention 182 Concerning the Prohibition 
and Immediate Action for the Elimination of the Worst Forms of Child Labor  (1999), and to advance 
other common commitments, the Parties hereby establish a Labor Cooperation Mechanism, as set out 
in Annex 18.5.  
Article 18.6 
 
Cooperative Consultations
 
 1. A Party may request consultations with the other Party regarding any matter arising under this 
Chapter by delivering a written request to the point  of contact that the other Party has designated 
under Article 18.4(3). 
2. The Parties shall consult promptly after deliv ery of the request. The requesting Party shall 
provide specific and sufficient information in the request for the other Party to respond. WT/REG160/1 
Page 192  
 
3. The Parties shall make every attempt to arrive at a mutually satisfactory resolution of the 
matter and may seek advice or assistance from any pers on or body they deem appropriate in order to 
fully examine the matter at issue. 
4. If the Parties fail to resolve a matter through consultations, either Party may request that the 
Council be convened to consider th e matter by delivering a written request to the other Party’s point 
of contact. 
5. The Council shall promptly convene and shall endeavor to resolve the matter, including, 
where appropriate, by consulting outside expert s and having recourse to such procedures as good 
offices, conciliation, or mediation. 
6. If the matter concerns whether a Party is conforming to its obligations under Article 
18.2(1)(a), and the Parties have failed to resolv e the matter within 60 days of a request under 
paragraph 1, the complaining Party may request c onsultations under Article 22.4 (Consultations) or a 
meeting of the Commission under Article 22. 5 (Commission – Good Offices, Conciliation, and 
Mediation) and, as provided in Chapter Twenty-Two (Dispute Settlement), thereafter have recourse to 
the other provisions of that Chapter. 
7. Neither Party may have recourse to dispute settlement under this Agreement for any matter 
arising under any provision of this Ch apter other than Article 18.2(1)(a). 
8. Neither Party may have recourse to dispute settlement under this Agreement for a matter 
arising under Article 18.2(1)(a) without first pursuin g resolution of the matter in accordance with this 
Article. 
Article 18.7 
 
Labor Roster
 
 1. The Parties shall establish within six months af ter the date of entry into force of this 
Agreement and maintain a roster of up to 12 i ndividuals who are willing and able to serve as 
panellists in disputes arising unde r Article 18.2(1)(a). Unless the Parties otherwise agree, four 
members of the roster shall be  selected from among individuals w ho are non-Party nationals. Labor 
roster members shall be appointed by mutual agre ement of the Parties and may be reappointed. Once 
established, a roster shall remain in effect for a mi nimum of three years, and shall remain in effect 
thereafter until the Parties constitute a new roster.  
2. Labor roster members shall: 
(a) have expertise or experience in labor law or  its enforcement, or in the resolution of 
disputes arising under international agreements; 
(b) be chosen strictly on the basis of obj ectivity, reliability, and sound judgment; 
(c) be independent of, and not affiliated with or take instructions from, either Party; and 
(d) comply with a code of conduct to be established by the Commission. 
3. Where a Party claims that a dispute arises under Article 18.2(1)(a), Article 22.9 (Panel 
Selection) shall apply, except that the panel sha ll be composed entirely of panellists meeting the 
qualifications in paragraph 2. 
  WT/REG160/1 
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Article 18.8 
 
Definitions  
  For purposes of this Chapter: 
 
 labor laws  means a Party’s statutes or regulations, or  provisions thereof, that are directly 
related to the following internationally recognized labor rights:  
(a) the right of association; 
(b) the right to organize and bargain collectively; 
(c) a prohibition on the use of any form of forced or compulsory labor; 
(d) a minimum age for the employment of child ren and the prohibition and elimination of 
the worst forms of child labor; and  
(e) acceptable conditions of work with respect to minimum wages, hours of work, and 
occupational safety and health. 
For greater certainty, the setting of standards and levels in respect of minimum wages by each 
Party shall not be subject to obligations under this Chapter. Each Party’s obligations  under 
this Chapter pertain to enforcing the level of  the general minimum wage established by that 
Party. 
 
 statutes or regulations  means: 
 
(a) for the United States, acts of the Congress or regulations promulgated pursuant to acts 
of the Congress that are enforceable by action of the federal government; and 
(b) for Chile, acts or regulations promulgated pur suant to acts that ar e enforceable by the 
agency charged with enforcing Chile’s labor laws. 
 
ANNEX 18.5 
 
Labor Cooperation Mechanism
 
 Establishment Of A Labor Cooperation Mechanism 
 
1. Recognizing that bilateral cooperation on labor  matters will provide enhanced opportunities 
for the Parties to improve labor standards, a nd to further advance their common commitments, 
including the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up  
(1998), the Parties have establishe d a Labor Cooperation Mechanism. 
Organization And Principal Functions 
 
2. Each Party shall designate an office within its ministry of labor to serve as a point of contact 
to support the work of the Labor Cooperation Mechanism. 
3. The Parties’ labor ministries shall carry out the work of the Labor Cooperation Mechanism by 
developing and pursuing cooperative activities on la bor matters, including by working jointly to: WT/REG160/1 
Page 194  
 
(a) establish priorities for cooperative activities; 
(b) develop and periodically revise a work program of specific cooperative activities in 
accord with such priorities; 
(c) exchange information regarding labor po licies and the observance and effective 
application of labor law and practice in the Parties’ territories; 
(d) exchange information on and encourage best  labor practices, including best practices 
adopted by multinational firms, small and medium enterprises, and other private 
enterprises, as well as by labor organizations; 
(e) advance understanding of, respect for, and e ffective implementation of the principles 
reflected in the ILO Declaration on Fundamental Principles and Rights at Work and 
its Follow-up  (1998); 
(f) promote the collection and publication of co mparable data on labor standards, labor 
market indicators, and enforcement activity; 
(g) arrange periodic labor cooperation review ses sions at the request of either Party, 
review current cooperative activities, and provide guidance for future cooperative 
activities between the Parties; and 
(h) develop recommendations to their respectiv e governments for their consideration. 
Cooperative Activities 
 
4. The Labor Cooperation Mechanism may undertak e cooperative activities on any labor matter 
it considers appropriate, such as on: 
(a) fundamental rights and their effective application : legislation, practice, and 
implementation related to the core elements of the ILO Declaration on Fundamental 
Principles and Rights at Work and its Follow-up  (1998) (freedom of association and 
the effective recognition of the right to coll ective bargaining, elimination of all forms 
of forced or compulsory labor, abolition of  child labor, including the worst forms of 
child labor in compliance with the ILO Convention Nº182 on the Worst Forms of 
Child Labour  (1999), and elimination of employment discrimination); 
(b) labor relations : forms of cooperation among workers, management, and 
governments, including the resolution of labor disputes; 
(c) working conditions : legislation, practice, and impl ementation related to occupational 
safety and health; prevention of and co mpensation for work-related injuries and 
illness; and employment conditions;  
(d) issues related to small and medium enterprises : promotion of fundamental rights at 
work; improvement of working conditions;  forms of cooperation between employers 
and worker representatives; and social pr otection services agreed between workers’ 
organizations and employers or their associations;  
(e) social protections : human resource development and employment training; work 
benefits; social programs for workers and their families; migrant workers; worker 
adjustment programs; and social protec tion, including social security, income 
security, and health care services;  WT/REG160/1 
 Page 195 
 
 
(f) technical issues and information exchange : programs, methodologies, and 
experiences regarding productivity impr ovement; labor statistics, including 
comparable data; current ILO issues and activities; consideration and encouragement of best labor practices; and the effective u se of technologies, including those that are 
Internet-based; and 
(g) implications of economic integration betw een the Parties for advancing each Party’s 
labor objectives. 
Implementation Of Cooperative Activities 
 
5. The Parties may carry out cooperative activities under this Annex through any form they 
deem appropriate, including by: 
(a) exchanging government delegations, professi onals, and specialists, including through 
study visits; 
(b) sharing information, standards, regula tions and procedures and best practices, 
including through the exchange of pe rtinent publications and monographs; 
(c) organizing joint conferences, seminars, workshops, meetings, training sessions, and 
outreach and education programs; 
(d) developing collaborative projects or demonstrations; 
(e) undertaking joint research projects, studies, and reports, including by engaging 
independent experts with  relevant expertise; 
(f) drawing on the expertise of academic and ot her institutions in their territories in 
developing and implementing c ooperative programs and by encouraging relationships 
between such institutions on technical labor issues; and 
(g) engaging in technical exchanges and cooperation. 
6. In identifying areas for cooperation and carryi ng out cooperative activities, the Parties shall 
consider views of their respective worker and employer representatives, as well as other members of 
civil society. 
 
CHAPTER NINETEEN : ENVIRONMENT 
 
Objectives
 
 
 The objectives of this Chapter are to contribute to  the Parties’ efforts to ensure that trade and 
environmental policies are mutually supportive and to collaboratively promote the optimal use of 
resources in accordance with the objective of sustaina ble development; and to strive to strengthen the 
links between the Parties’ trade and environment policies and practices to further the trade expanding 
goals of this Agreement, including through promoting non-discriminatory measures, avoiding 
disguised barriers to trade, and eliminating trade di stortions where the result can directly benefit both 
trade and the environment. 
 
   WT/REG160/1 
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Article 19.1 
 
Levels Of Protection
 
  Recognizing the right of each Party to establis h its own levels of domestic environmental 
protection and environmental devel opment policies and priorities, and to adopt or modify accordingly 
its environmental laws, each Party shall ensure that its laws provide for high levels of environmental 
protection and shall strive to continue to improve those laws.  
Article 19.2 
 
Enforcement Of Environmental Laws
 
 1. (a) A Party shall not fail to effectively enforce its environmental laws, through a 
sustained or recurring course of action or inaction, in a manner affecting trade 
between the Parties, after the date of entry into force of this Agreement. 
(b) The Parties recognize that each Party retains the right to exercise discretion with 
respect to investigatory, prosecutorial, regulatory, and compliance matters and to 
make decisions regarding the allocation of resources to enforcement with respect to 
other environmental matters determined to have higher priorities. Accordingly, the 
Parties understand that a Party is in comp liance with subparagraph (a) where a course 
of action or inaction reflects a reasonable exercise of such discretion, or results from a 
bona fide  decision regarding the allocation of resources. 
2. The Parties recognize that it is inappropriate to  encourage trade or investment by weakening 
or reducing the protections afforded in domestic environmental laws. Accordingly, each Party shall 
strive to ensure that it does not waive or otherwi se derogate from, or offer to waive or otherwise 
derogate from, such laws in a manner that weakens or reduces the protections afforded in those laws 
as an encouragement for trade with the other Part y, or as an encouragement for the establishment, 
acquisition, expansion, or retention of an investment in its territory. 
3. Nothing in this Chapter shall be construed to empower a Party’s authorities to undertake 
environmental law enforcement activities in  the territory of the other Party.  
Article 19.3 
 
Environment Affairs Council
 
 1. The Parties hereby establish an Environmen t Affairs Council comprising cabinetlevel or 
equivalent representatives of the Parties, or thei r designees. The Council shall meet once a year, or 
more often if the Parties agree, to discuss the implementation of, and progress under, this Chapter. 
Meetings of the Council shall include a public  session, unless the Parties otherwise agree. 
2. In order to share innovative approaches for addr essing environmental issues of interest to the 
public, the Council shall ensure a process for promoti ng public participation in its work, including by 
seeking advice from the public in developing agend as for Council meetings and by engaging in a 
dialogue with the public on those issues. 
3. The Council shall seek appropriate opportunitie s for the public to participate in the 
development and implementation of cooperative environmental activities, including through the 
United States - Chile Environmental Cooperation Agreement, as set out in Annex 19.3.  WT/REG160/1 
 Page 197 
 
 
4. All decisions of the Council shall be taken by  mutual agreement and shall be made public, 
unless the Council decides otherwise, or as otherwise provided in this Agreement. 
Article 19.4 
 
Opportunities For Public Participation  
 
1. Each Party shall provide for the receipt and consideration of public communications on 
matters related to this Chapter. Each Party shall pr omptly make available to the other Party and to its 
public all communications it receives and shall revi ew and respond to them in accordance with its 
domestic procedures. 
2. Each Party shall make best efforts to res pond favorably to requests for consultations by 
persons or organizations in its territory regarding the Party’s implementation of this Chapter. 
3. Each Party may convene, or consult an existi ng, national consultative or advisory committee, 
comprising members of its public, including representatives of business and environmental 
organizations, and other pers ons, to advise it on the implementation of this Chapter. 
Article 19.5 
 
Environmental Cooperation  
 1. The Parties recognize the importance of strengthening capacity to protect the environment 
and promote sustainable development in concert w ith strengthening trade and investment relations 
between them. The Parties agree to undertake coope rative environmental activities, in particular 
through: 
(a) pursuing, through their relevant ministries or agencies, the specific cooperative 
projects that the Parties have identified and set out in Annex 19.3; and 
(b) promptly negotiating a United States – Ch ile Environmental C ooperation Agreement 
to establish priorities for further cooperative environmental activities, as elaborated in 
Annex 19.3,  
while recognizing the ongoing importance of envir onmental cooperation undertaken outside this 
Agreement.  2. Each Party shall take into account public  comments and recommendations it receives 
regarding cooperative environmental activities th e Parties undertake pursuant to this Chapter. 
3. The Parties shall, as they deem appropriate , share information on their experiences in 
assessing and taking into account positive or negative environmental effects of trade agreements and 
policies. 
Article 19.6 
 
Environmental Consultations
 
 1. A Party may request consultations with the other Party regarding any matter arising under this 
Chapter by delivering a written request to the other Party. 
2. The Parties shall consult promptly after deliv ery of the request. The requesting Party shall 
provide specific and sufficient information in the request for the other Party to respond.  WT/REG160/1 
Page 198  
 
3. The Parties shall make every attempt to arrive at a mutually satisfactory resolution of the 
matter and may seek advice or assistance from any pers on or body they deem appropriate in order to 
fully examine the matter at issue. 
4. If the Parties fail to resolve the matter through consultations, either Party may request that the 
Council be convened to consider the matter by de livering a written request to the other Party. 
5. The Council shall promptly convene and shall endeavor to resolve the matter, including, 
where appropriate, by consulting governmental or  outside experts and having recourse to such 
procedures as good offices, conciliation, or mediation. 
6. If the matter concerns whether a Party is conforming to its obligations under Article 
19.2(1)(a), and the Parties have failed to resolv e the matter within 60 days of a request for 
consultations under paragraph 1, th e complaining Party may request consultations under Article 22.4 
(Consultations) or a meeting of the Commission under Article 22.5 (Commission - Good Offices, 
Conciliation, and Mediation) a nd, as provided in Chapter Twenty-Two (Dispute Settlement), 
thereafter have recourse to the other provisions of that Chapter. 
7. The Council may, where appropriate, provide in formation to the Commission regarding any 
consultations held on the matter. 
8. Neither Party may have recourse to dispute settlement under this Agreement for any matter 
arising under any provision of this Ch apter other than Article 19.2(1)(a). 
9. Neither Party may have recourse to dispute settlement under this Agreement for a matter 
arising under Article 19.2(1)(a) without first pursuin g resolution of the matter in accordance with this 
Article. 
10. In cases where the Parties agree that a matter arising under this Chapter is more properly 
covered by another agreement to which the Parties ar e party, they shall refer the matter for appropriate 
action in accordance with that agreement. 
Article 19.7 
 
Environment Roster
 
 1. The Parties shall establish within six months af ter the date of entry into force of this 
Agreement and maintain a roster of at least 12 individuals who are willing and able to serve as 
panellists in disputes arising unde r Article 19.2(1)(a). Unless the Parties otherwise agree, four 
members of the roster shall be selected from among individual s who are non-Party nationals. 
Environment roster members shall be appointed by  mutual agreement of the Parties, and may be 
reappointed. Once established, a roster  shall remain in effect for a mi nimum of three years, and shall 
remain in effect thereafter until th e Parties constitute a new roster. 
2. Environment roster members shall: 
(a) have expertise or experience in environmen tal law or its enforcement, international 
trade, or the resolution of disputes aris ing under international trade agreements; 
(b) be chosen strictly on the basis of obj ectivity, reliability, and sound judgment; 
(c) be independent of, and not affiliated with or take instructions from, either Party; and 
(d) comply with a code of conduct to be established by the Commission.   WT/REG160/1 
 Page 199 
 
 
3. Where a Party claims that a dispute arises under Article 19.2(1)(a), Article 22.9 (Panel 
Selection) shall apply, except that: 
(a) where the Parties so agree, the panel shall be composed entirely of panellists meeting 
the qualifications in paragraph 2; and  
(b) if the Parties cannot so agree, each Party may select panellists meeting the 
qualifications set out in paragraph 2 or in Article 22.8 (Qualifications of Panellists). 
Article 19.8 
 
Procedural Matters  
 
1. Each Party shall ensure that judicial, quasi -judicial, or administrative proceedings are 
available under its law to sanction or reme dy violations of its environmental laws. 
(a) Such proceedings shall be fair, open, and equ itable, and to this end shall comply with 
due process of law, and be open to the public (except where the administration of justice otherwise requires). 
(b) Each Party shall provide appropriate and effective remedies or sanctions for a 
violation of its environmental laws that: 
(i) take into consideration the nature and gravity of the violation, any economic 
benefit the violator has derived from the violation, the economic condition of the violator, and other relevant factors; and 
(ii) may include compliance agreements, penalties, fines, imprisonment, 
injunctions, the closure of facilities, and the cost of containing or cleaning up 
pollution. 
2. Each Party shall ensure that interested pers ons may request the Party’s competent authorities 
to investigate alleged violations of  its environmental laws and that the competent authorities give such 
requests due consideration in accordance with its law. 
3. Each Party shall ensure that persons with a legally recognized interest under its law in a 
particular matter have appropriate access to judici al, quasi-judicial, or administrative proceedings for 
the enforcement of the Party’s environmental laws. 
4. Each Party shall provide persons appropriate and effective rights of access to remedies in 
accordance with its laws, which may include the right: 
(a) to sue another person under that Party’s jurisdiction for damages under that Party’s 
environmental laws; 
(b) to seek sanctions or remedies such as mone tary penalties, emergency closures, or 
orders to mitigate the consequences of violations of its environmental laws; 
(c) to request the competent authorities to take appropriate action to enforce the Party’s 
environmental laws in order to protect th e environment or to avoid environmental 
harm; or 
(d) to seek injunctions where a person suffers, or  may suffer, loss, damage, or injury as a 
result of conduct by another person under th at Party’s jurisdiction contrary to that WT/REG160/1 
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Party’s environmental laws or from tortious  conduct that harms human health or the 
environment. 
Article 19.9 
 
Relationship To Environmental Agreements
 
 
 The Parties recognize the importance of multila teral environmental ag reements, including the 
appropriate use of trade measures in such agre ements to achieve specific environmental goals. 
Recognizing that in paragraph 31(i) of the Ministerial Declaration adopted on November 14, 2001 in 
Doha , WTO members have agreed to negotiations on  the relationship between existing WTO rules 
and specific trade obligations set out in multilate ral environmental agreements, the Parties shall 
consult on the extent to which the outcome of the negotiations applies to this Agreement. 
 
Article 19.10 
 
Principles Of Corporate Stewardship  
  Recognizing the substantial benefits brought by  international trade and investment as well as 
the opportunity for enterprises to implement policies for sustainable development that seek to ensure 
coherence between social, economic and environm ental objectives, each Party should encourage 
enterprises operating within its territory or jurisd iction to voluntarily incorporate sound principles of 
corporate stewardship in their internal policies, such  as those principles or agreements that have been  
endorsed by both Parties.  
Article 19.11 
 
Definitions
 
  For purposes of this Chapter:   environmental law  means any statute or regulation of a Party, or provision thereof, the 
primary purpose of which is the protection of the e nvironment, or the prevention of a danger to human 
life or health, through:  
 
(a) the prevention, abatement, or control of the release, discharge, or emission of 
pollutants or environmental contaminants; 
(b) the control of environmentally hazardous or toxic chemicals, substances, materials, 
and wastes, and the dissemination of information related thereto; or 
(c) the protection or conservation of wild fl ora and fauna, including endangered species, 
their habitat, and specially protected natural areas, 
in the Party’s territory, but does not include any statute or regulation, or provision thereof, 
directly related to worker safety or health. 
 
 For greater certainty, environmental law  does not include any statute or regulation, or 
provision thereof, the primary purpose of which is managing the commercial harvest or exploitation, 
or subsistence or aboriginal ha rvesting, of natural resources. 
  For purposes of the definition of “environmental law,” the primary purpose of a particular 
statutory or regulatory provision shall be determined  by reference to its primary purpose, rather than 
to the primary purpose of the statute or regulation of which it is part.  WT/REG160/1 
 Page 201 
 
 
 For the United States, statute or regulation  means an act of Congress or regulation 
promulgated pursuant to an act of Congress that is  enforceable by action of the federal government. 
  For the United States, territory  means its territory as set out in Annex 2.1 as well as other 
areas with respect to which it exercises sovere ignty, sovereign rights, or jurisdiction. 
 
 
ANNEX 19.3 
 
Environmental Cooperation
 
 
1. Recognizing that cooperation on environmental matters provides enhanced opportunities to 
improve the environment and to advance common commitments on sustainable development, the Parties agree, pursuant to Article 19.5(1)(a) of th is Agreement, to pursue, through their relevant 
ministries or agencies, the following cooperative pr ojects identified during the negotiation of this 
Agreement: 
(a) Developing a Pollutant Release and Transfer Register (PRTR) in Chile . The PRTR is 
a publicly available database of chemicals that  have been released to air, water and 
land or transferred off-site for further wast e management. In developing the register, 
the Parties will cooperate and draw on l essons learned from other PRTR projects. 
Industrial facilities will report annually on the amounts of chemicals they have 
released or transferred and the final destina tion of those chemicals.  Reported data will 
be made publicly available; 
(b) Reducing Mining Pollution . The United States will assist Chile in reducing 
contamination and pollution resulting from past mining practices by working with Chile to identify sources of pollution and explore cost-effective remediation methods; 
(c) Improving Environmental Enfo rcement and Compliance Assurance . The Parties will 
provide training and exchange of informa tion to enhance each Party’s capacity to 
enforce its environmental laws and regula tions, and will develop and strengthen their 
cooperative relationships to promote comp liance, enforcement, and environmental 
performance; 
(d) Sharing Private Sector Expertise . The Parties will seek to increase environmental 
stewardship by inviting enterprises of ea ch Party to share their experiences in 
developing and implementing programs that have reduced pollution, including, where 
appropriate, demonstrating the fina ncial benefits of these measures; 
(e) Improving Agricultural Practices . To help reduce pollution from agricultural 
practices in Chile, the Parties will adapt and implement a training program for 
Chilean farmers and other workers to pr omote appropriate handling of chemical 
pesticides and fertilizers, and to promote su stainable agriculture practices. The Parties 
will work jointly to modify existing trai ning programs to fit Chilean agricultural 
practices and customs; 
(f) Reducing Methyl Bromide Emissions . To mitigate methyl bromide emissions the 
Parties will seek to develop effective alte rnatives to that chemical, which Chile and 
the United States have committed to phase out under the Montreal Protocol on 
Substances That Deplete the Ozone Layer; 
(g) Improving Wildlife Prot ection and Management . To protect wildlife in Chile and the 
Latin American region, the Parties will work  together to build capacity to promote the WT/REG160/1 
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management and protection of biological  resources in the region, such as by 
collaborating with universities and providing programs for wildlife managers, other 
professionals and local communities in Chile and the region;  
(h) Increasing the use of cleaner fuels . The Parties will work to improve the 
environmental quality of fuels, especially diesel fuel and gasoline, used in their 
territories by providing joint training and technical assistance on a variety of fuels-
related environmental issues. The Parties will publicize the benefits of this work. 
2. The Parties shall pursue additional cooperative environmental activities under a United States 
– Chile Environmental Cooperation Agreement, as set out in Article 19.5(1)(b), and in other fora.  
(a) In negotiating the Cooperation Agreement, the Parties have agreed to take into 
account public input regarding priori ty areas for bilateral cooperation; 
(b) The Cooperation Agreement will, inter alia :  
(i) establish any institutional framework n eeded to coordinate the various 
elements of the Cooperation Agreement; 
(ii) establish procedures for the development of periodic work programs that set 
priorities for cooperative activities; 
(iii) provide for consultation and review, at re gular intervals, of the work program 
for those cooperative activities;  
(iv) create appropriate opportunities for the public to participate in the 
development of new cooperative activiti es and the implementation of agreed 
activities; 
(v) encourage the exchange of information on the Parties’ environmental 
policies, laws, and practices; 
(vi) promote the understanding and effec tive implementation of multilateral 
environmental agreements to which both Parties are party; 
(vii) promote the collection and publication of comparable information on the 
Parties’ environmental regulations, in dicators, and enforcement activities; 
and 
(viii) provide for regular consultation w ith the Environment Affairs Council 
established in Article 19.3 (Environ ment Affairs Council) regarding the 
priorities that the Parties identify,  as well as future cooperative work. 
3. Cooperation under the Cooperation Agreement may include work in the following fields of 
activity: 
(a) improving capacity to achieve environm ental compliance assurance, including 
enforcement and voluntary environmental stewardship; 
(b) encouraging small- and medium-size en terprises to adopt sound environmental 
practices and technologies; 
(c) developing public-private partnerships  to achieve environmental objectives;  WT/REG160/1 
 Page 203 
 
 
(d) promoting sustainable management of envi ronmental resources, including wild fauna 
and flora, and protected wild areas; 
(e) exploring environmental activities pertin ent to trade and investment and the 
improvement of environmental performance; 
(f) developing and implementing economic inst ruments for environmental management. 
4. The Parties may implement cooperative ac tivities under the Cooperation Agreement by: 
(a) exchanging professionals, technicians, and specialists, including through study visits, 
to promote the development of environmental policies and standards; 
(b) organizing joint conferences, seminars, workshops, meetings, training sessions, and 
outreach and education programs; 
(c) supporting, developing, and implementing co llaborative projects and demonstrations, 
including joint research projects, studies, and reports; 
(d) facilitating linkages among representatives from academia, industry, and government 
to promote exchange of scientific and tec hnical information and best practices, and 
the development and implementati on of cooperative projects; and  
(e) engaging in other activities, that the Parties may undertake pursuant to the 
Cooperation Agreement. 
5. The Parties recognize that the funding, scope, a nd duration of the projects listed in paragraph 
1 and cooperative activities pursued under the C ooperation Agreement will be undertaken in 
accordance with the Parties’ pers onnel and financial resources.  
6. The Parties shall make publicly available in formation regarding the projects and activities 
they undertake pursuant to this Annex. 
 
CHAPTER TWENTY : TRANSPARENCY 
 
Article 20.1 
 
Contact Points  
 1. Each Party shall designate a contact point to facilitate communications between the Parties on 
any matter covered by this Agreement. 
2. On the request of the other Party, the contact  point shall identify the office or official 
responsible for the matter and assist, as necessary,  in facilitating communication with the requesting 
Party. 
Article 20.2 
 
Publication
 
 
1. Each Party shall ensure that its laws, regulati ons, procedures, and administrative rulings of 
general application respecting any matter covered by this Agreement are promptly published or WT/REG160/1 
Page 204  
 
otherwise made available in such a manner as to en able interested persons and the other Party to 
become acquainted with them. 
2. To the extent possible, each Party shall: 
(a) publish in advance any such measure that it proposes to adopt; and 
(b) provide interested persons and the other Party a reasonable opportunity to comment 
on such proposed measures. 
Article 20.3 
 
Notification And Provision Of Information
 
 
1. To the maximum extent possible, each Party sha ll notify the other Party of any proposed or 
actual measure that the Party considers might materi ally affect the operation of this Agreement or 
otherwise substantially affect the other Party’s interests under this Agreement. 
2. On request of the other Party, a Party sha ll promptly provide information and respond to 
questions pertaining to any actual or proposed meas ure, whether or not the other Party has been 
previously notified of that measure. 
3. Any notification or information provided under this Article shall be without prejudice as to 
whether the measure is consiste nt with this Agreement.  
Article 20.4 
 
Administrative Proceedings  
 
 With a view to administering in a consistent , impartial, and reasonable manner all measures 
of general application affecting matte rs covered by this Agreement, each Party shall ensure that in its 
administrative proceedings applying measures referre d to in Article 20.2 to particular persons, goods, 
or services of the other Party in specific cases that:  
 
(a) wherever possible, persons of the other Party that are directly affected by a 
proceeding are provided reasonable notice, in accordance with domestic procedures, when a proceeding is initiated, including a d escription of the nature of the proceeding, 
a statement of the legal authority under which the proceeding is initiated, and a 
general description of any issues in controversy; 
(b) such persons are afforded a reasonable opportunity to present facts and arguments in 
support of their positions prior to any fina l administrative action, when time, the 
nature of the proceeding, and the public interest permit; and 
(c) its procedures are in accordance with domestic law.  
Article 20.5 
 
Review And Appeal
 
 1. Each Party shall establish or maintain judicial , quasi-judicial, or administrative tribunals or 
procedures for the purpose of the prompt review  and, where warranted, correction of final 
administrative actions regarding matters covered by th is Agreement. Such tribunals shall be impartial  WT/REG160/1 
 Page 205 
 
 
and independent of the office or authority entrus ted with administrative enforcement and shall not 
have any substantial interest in the outcome of the matter. 
2. Each Party shall ensure that, in any such tribuna ls or procedures, the parties to the proceeding 
are provided with the right to: 
(a) a reasonable opportunity to support or  defend their respective positions; and 
(b) a decision based on the evidence and submi ssions of record or, where required by 
domestic law, the record compiled by the administrative authority. 
3. Each Party shall ensure, subject to appeal or further review as provided in its domestic law, 
that such decisions shall be implemented by, and shall govern the practice of, the office or authority 
with respect to the administrative action that is the subject of the decision. 
Article 20.6 
 
Definitions  
  For purposes of this Chapter: 
 
 administrative ruling of general application  means an administrative ruling or 
interpretation that applies to all persons and fact situ ations that fall generally within its ambit and that 
establishes a norm of conduct but does not include:  
(a) a determination or ruling made in an administrative or quasi-judicial proceeding that 
applies to a particular person, good, or serv ice of the other Party in a specific case; or 
(b) a ruling that adjudicates with respect to a particular act or practice. 
 
CHAPTER TWENTY-ONE : ADMINISTRATION OF THE AGREEMENT 
 
Article 21.1 
 
The Free Trade Commission
 
 1. The Parties hereby establish the Free Trad e Commission, comprising cabinet-level 
representatives of the Parties or their designees. 
2. The Commission shall: 
(a) supervise the implementation of this Agreement; 
(b) oversee the further elaboration of this Agreement; 
(c) seek to resolve disputes that may arise rega rding the interpretation or application of 
this Agreement; 
(d) supervise the work of all committees a nd working groups established under this 
Agreement; 
(e) establish the amounts of remuneration and expe nses that will be paid to panellists; 
and WT/REG160/1 
Page 206  
 
(f) consider any other matter that may a ffect the operation of this Agreement. 
3. The Commission may: 
(a) establish and delegate responsibiliti es to committees and working groups; 
(b) in accordance with Annex 21.1, further the implementation of the Agreement’s 
objectives by approving any modifications of: 
(i) the Schedules attached to Annex 3.3 (Tariff Elimination), by accelerating 
tariff elimination, 
(ii) the rules of origin established in Annex 4.1 (Specific Rules of Origin), 
(iii) the Common Guidelines referenced in  Article 4.17 (Common Guidelines), 
and 
(iv) the Sections of Annex 9.1 (Government Procurement); 
(c) seek the advice of non-governmental persons or groups; and 
(d) take such other action in the exercise of its functions as the Parties may agree. 
4. The Commission shall establish its rules and procedures. All decisions of the Commission 
shall be taken by mutual agreement. 
5. The Commission shall convene at least once a y ear in regular session. Regular sessions of the 
Commission shall be chaired successively by each Party. 
Article 21.2 
 
Administration Of Dispute Settlement Proceedings
 
 
1. Each Party shall designate an office that sh all provide administrative assistance to panels 
established under Chapter Twenty-Two (Dispute Settlem ent) and perform such other functions as the 
Commission may direct. 
2. Each Party shall be responsible for the operati on and costs of its designated office, and shall 
notify the Commission of the location of its office.  WT/REG160/1 
 Page 207 
 
 
ANNEX 21.1 
 
Implementation Of Modifications Approved By The Commission  
  Chile shall implement the actions of the Commi ssion referenced in Article 21.1(3)(b) through 
Acuerdos de Ejecución , in accordance with article 50, numeral 1, second paragraph, of the 
Constitución Política de la República de Chile . 
  
CHAPTER TWENTY-TWO : DISPUTE SETTLEMENT 
 
Article 22.1 
 
Cooperation
 
 
 The Parties shall at all times endeavor to agr ee on the interpretation and application of this 
Agreement, and shall make every attempt throug h cooperation and consulta tions to arrive at a 
mutually satisfactory resolution of any ma tter that might affect its operation.  
 
Article 22.2 
 
Scope Of Application  
  Except as otherwise provided in this Agreemen t, the dispute settlement provisions of this 
Chapter shall apply:  
(a) with respect to the avoidance or settlement of all disputes between the Parties 
regarding the interpretation or application of this Agreement; 
(b) wherever a Party considers that a measure of  the other Party is inconsistent with the 
obligations of this Agreement or that the other Party has otherwise failed to carry out 
its obligations under this Agreement; and 
(c) wherever a Party considers that a measur e of the other Party causes nullification or 
impairment in the sense of Annex 22.2. 
Article 22.3 
 
Choice Of Forum
 
 
1. Where a dispute regarding any matter arises under this Agreement and under another free 
trade agreement to which both Parties are party or  the WTO Agreement, the complaining Party may 
select the forum in which to settle the dispute. 
2. Once the complaining Party has requested a panel under an agreement referred to in 
paragraph 1, the forum selected shall be used to the exclusion of the others. 
Article 22.4 
 
Consultations  
 1. Either Party may request in writing consultations  with the other Party with respect to any 
actual or proposed measure or any other matter that  it considers might affect the operation of this 
Agreement. WT/REG160/1 
Page 208  
 
2. The requesting Party shall set out the reasons for the request, including identification of the 
measure or other matter at issue and an indication of the legal basis for the complaint, and shall deliver the request to the other Party. 
3. Consultations on matters regard ing perishable goods shall commence within 15 days of the 
date of delivery of the request. 
4. The Parties shall make every attempt to arrive at a mutually satisfactory resolution of any 
matter through consultations under this  Article or other consultative pr ovisions of this Agreement. To 
this end, the Parties shall: 
(a) provide sufficient information to enable a full examination of how the actual or 
proposed measure or other matter might aff ect the operation and application of this 
Agreement; and 
(b) treat any confidential information exchange d in the course of consultations on the 
same basis as the Party pr oviding the information. 
5. In consultations under this Article, a Party ma y request the other Party to make available 
personnel of its government agencies or other regul atory bodies who have expertise in the matter 
subject to consultations. 
Article 22.5 
 
Commission - Good Offices, Conciliation, And Mediation
 
 1. A Party may request in writing a meeting of the Commission if the Parties fail to resolve a 
matter pursuant to Article 22.4 within: 
(a) 60 days of delivery of a request for consultations; 
(b) 15 days of delivery of a request for consu ltations in matters regarding perishable 
goods; or 
(c) such other period as they may agree. 
2. A Party may also request in writing a meeting of the Commission where consultations have 
been held pursuant to Article 18.6 (Cooperativ e Consultations), Article 19.6 (Environmental 
Consultations) or Article 7.8 (Comm ittee on Technical Barriers to Trade). 
3. The requesting Party shall state in the request the measure or other matter complained of and 
deliver the request to the other Party. 
4. Unless it decides otherwise, the Commission shall convene within 10 days of delivery of the 
request and shall endeavor to resolve the dispute promptly. The Commission may: 
(a) call on such technical advisers or create su ch working groups or expert groups as it 
deems necessary; 
(b) have recourse to good offices, conciliati on, mediation, or such other dispute 
resolution procedures;  or  
(c) make recommendations,   WT/REG160/1 
 Page 209 
 
 
as may assist the Parties to reach a mutually satisfactory resolution of the dispute.  
Article 22.6 
 
Request For An Arbitral Panel
 
 
1. If the Parties fail to resolve a matter within: 
(a) 30 days of the Commission convening pursuant to Article 22.5; 
(b) 75 days after a Party has delivered a request  for consultations under Article 22.4, if 
the Commission has not convened pursuant to Article 22.5(4);  
(c) 30 days after a Party has delivered a request for consultations under Article 22.4 in a 
matter regarding perishable goods, if the Commission has not convened pursuant to Article 22.5(4); or 
(d) such other period as the Parties agree, 
either Party may request in writing the establishment of  an arbitral panel to consider the matter. The 
requesting Party shall state in the request the measure  or other matter complained of and indicate the 
provisions of this Agreement that it considers relevant, and shall deliver  the request to the other Party. 
An arbitral panel shall be established upon delivery of a request.  2. Unless the Parties otherwise agree, the panel sh all be established and perform its functions in 
a manner consistent with the provisions of this Chapter. 
3. Notwithstanding paragraphs 1 and 2, an arbitral  panel may not be established to review a 
proposed measure. 
Article 22.7 
 
Roster
 
 
1. The Parties shall establish within six months of  the entry into force of this Agreement and 
maintain a roster of at least 20 individuals who ar e willing and able to serve as panellists. Unless the 
Parties otherwise agree, six roster members shall be selected from among individuals who are non-Party nationals. The roster members shall be appoint ed by mutual agreement of the Parties, and may 
be reappointed. Once established, a roster shall rema in in effect for a minimum of three years, and 
shall remain in effect thereafter until the Parties constitute a new roster. 
2. Roster members shall: 
(a) have expertise or experience in law, interna tional trade, other matters covered by this 
Agreement, or  the resolution of dis putes arising under international trade 
agreements; 
(b) be chosen strictly on the basis of obj ectivity, reliability, and sound judgment; 
(c) be independent of, and not be affiliated with or take instru ctions from, any Party; and 
(d) comply with a code of conduct to be established by the Commission. 
 WT/REG160/1 
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Article 22.8 
 
Qualifications Of Panellists
 
  All panellists shall meet the qualifications set  out in Article 22.7(2). Individuals may not 
serve as panellists for a dispute in which they ha ve participated pursuant to Article 22.5(4)(a). 
 
Article 22.9 
 
Panel Selection
 
 
1. The Parties shall apply the followi ng procedures in selecting a panel: 
(a) the panel shall comprise three members; 
(b) the Parties shall endeavor to agree on the chair of the panel within 15 days of the 
delivery of the request for the establishment of the panel. If the Parties are unable to 
agree on the chair within this period, the chair shall be selected by lot within three 
days from among the roster members who are non-Party nationals; 
(c) within 15 days of selection of the chair, each Party shall select one panellist; 
(d) if a Party fails to select its panellist within such period, the panellist shall be selected 
by lot within three days from among the roster members who are nationals of the Party; and 
(e) each Party shall endeavor to select panellis ts who have expertise or experience 
relevant to the subject matter of the dispute. 
2. Panellists shall normally be sel ected from the roster. A Party may exercise a peremptory 
challenge against any individual not on the roster who is proposed as a panellist by the other Party 
within 15 days after the individual has been proposed. 
3. If a Party believes that a panellist is in viola tion of the code of conduct, the Parties shall 
consult and if they agree, the panellist shall be removed and a new panellist shall be selected in 
accordance with this Article. 
Article 22.10 
 
Rules Of Procedure
 
 
1. The Commission shall establish, by the date of en try into force of this Agreement, Rules of 
Procedure, which shall ensure: 
(a) a right to at least one hearing before the panel, which, subject to subparagraph (e), 
shall be open to the public; 
(b) an opportunity for each Party to provi de initial and rebuttal submissions; 
(c) that each Party’s written submissions, written versions of its oral statement, and 
written responses to a request or questions from the panel will be made public within 10 days after they are submitted,  subject to subparagraph (e);  WT/REG160/1 
 Page 211 
 
 
(d) that the panel will consider requests from  non-governmental entities located in the 
Parties’ territories to provide written views regarding the dispute that may assist the 
panel in evaluating the submissions and arguments of the Parties; and 
(e) the protection of confidential information. 
2. Unless the Parties otherwise agree, the panel sh all conduct its proceedi ngs in accordance with 
the Rules of Procedure and may, after consulting wi th the Parties, adopt additional procedural rules 
not inconsistent with the Rules of Procedure. 
3. The Commission may modify the Rules of Procedure. 
4. Unless the Parties otherwise agree within 20 days  from the date of the delivery of the request 
for the establishment of the panel, the terms of reference shall be:  
“To examine, in the light of the relevant provi sions of this Agreement, the matter referenced 
in the panel request and to make findings, de terminations and reco mmendations as provided 
in Article 22.12(3) and to deliver the written re ports referred to in Articles 22.12 and 22.13.” 
 
5. If the complaining Party wishes to  argue that a matter has nullified or impaired benefits, the 
terms of reference shall so indicate. 
6. If a Party wishes the panel to make findings as to the degree of adverse trade effects on a 
Party of any measure or other matter found not to co nform with the obligations of this Agreement or 
to have caused nullification or impairment in the sen se of Annex 22.2, the terms of reference shall so 
indicate. 
Article 22.11 
 
Experts And Technical Advice  
 1. On request of a Party, or, unless the Parties disapprove, on its own initiative, the panel may 
seek information and technical advice, including  information and technical advice concerning 
environmental, labor, health, safety, or other technical matters raised by a Party in a proceeding, from 
any person or body that it deems appropriate. 
2. Before a panel seeks information or technical advice, it shall establish appropriate procedures 
in consultation with the Parties. Th e panel shall provide the Parties: 
(a) advance notice of, and an opportunity to provide comments to the panel on, proposed 
requests for information and technical advice pursuant to paragraph 1; and 
(b) a copy of any information or technical advice submitted in response to a request 
pursuant to paragraph 1 and an opportunity to provide comments.  
3. Where the panel takes the information or techni cal advice into account in the preparation of 
its report, it shall also take into account any commen ts by the Parties on the information or technical 
advice. 
 
    WT/REG160/1 
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Article 22.12 
 
Initial Report
 
 1. Unless the Parties otherwise agree, the panel shall base its report on the relevant provisions of 
this Agreement and the submissions and arguments of the Parties. 
2. If the Parties agree, the panel may make r ecommendations for resolution of the dispute. 
3. Unless the Parties otherwise agree, the panel sha ll, within 120 days after the last panellist is 
selected, present to the Parties an initial report containing: 
(a) findings of fact, including any findings pursuant to a request under Article 22.10(6); 
(b) its determination as to whether a Party h as not conformed with its obligations under 
this Agreement or that a Party’s measure is  causing nullification or impairment in the 
sense of Annex 22.2, or any other determina tion requested in the terms of reference; 
and 
(c) its recommendations, if the Parties have requested them, for resolution of the dispute. 
4. Panellists may furnish separate opinion s on matters not unanimously agreed. 
5. A Party may submit written comments to the panel on its initial report within 14 days of 
presentation of the report or within such other period as the Parties may agree. 
6. After considering any written comments on the in itial report, the panel may reconsider its 
report and make any further exam ination it considers appropriate. 
Article 22.13 
 
Final Report
 
 1. The panel shall present a final report to the Parties, including any separate opinions on 
matters not unanimously agreed, within 30 days of presentation of the initial report, unless the Parties 
otherwise agree. The Parties shall release the fina l report to the public within 15 days thereafter, 
subject to the protection of confidential information.  
2. No panel may, either in its initial report or  its final report, disclose which panellists are 
associated with majority or minority opinions. 
Article 22.14 
 
Implementation Of Final Report
 
 1. On receipt of the final report of a panel, th e Parties shall agree on the resolution of the 
dispute, which normally shall conform with the dete rminations and recommendations, if any, of the 
panel. 
2. If, in its final report, the panel determines that  a Party has not conformed with its obligations 
under this Agreement or that a Party’s measure is causing nullification or impairment in the sense of  WT/REG160/1 
 Page 213 
 
 
Annex 22.2, the resolution, whenever possible, sh all be to eliminate the non-conformity or the 
nullification or impairment.1 
3. Where appropriate, the Parties may agree on a mutually satisfactory action plan to resolve the 
dispute, which normally shall conform with the dete rminations and recommendations, if any, of the 
panel. If the Parties agree on such an action plan, th e complaining Party may have recourse to Article 
22.15(2) or Article 22.16(1), as the case may be, only if  it considers that the Party complained against 
has failed to carry out the action plan. 
Article 22.15 
 
Non-Implementation - Suspension Of Benefits  
 
1. If a panel has made a determination of the type  described in Article 22.14(2) and the Parties 
are unable to reach agreement on a resolution pursuant to Article 22.14 within 45 days of receiving the final report, or such other period as the Parties ag ree, the Party complained against shall enter into 
negotiations with the other Party with a view to developing mutually acceptable compensation. 
2. If the Parties: 
(a) are unable to agree on compensation within 30 days after the period for developing 
such compensation has begun; or 
(b) have agreed on compensation or on a resolution pursuant to Article 22.14 and the 
complaining Party considers that the other Pa rty has failed to observe the terms of the 
agreement, 
the complaining Party may at any time thereafter pr ovide written notice to the other Party that it 
intends to suspend the application to the other Party of benefits of equivalent  effect. The notice shall 
specify the level of benefits that the Party pr oposes to suspend. Subject to paragraph 5, the 
complaining Party may begin suspending benefits 30 days after the later of the date on which it 
provides notice under this paragraph or the panel i ssues its determination under paragraph 3, as the 
case may be. 
 3. If the Party complained against considers that: 
(a) the level of benefits proposed to be suspended is manifestly excessive; or 
(b) it has eliminated the non-conformity or the nullification or impairment that the panel 
has found, 
it may, within 30 days after the complaining Part y provides notice under paragraph 2, request that the 
panel be reconvened to consider the matter. The Part y complained against shall deliver its request in 
writing to the other Party. The panel shall reconve ne as soon as possible after delivery of the request 
and shall present its determination to the Parties w ithin 90 days after it reconvenes to review a request 
under subparagraph (a) or (b), or within 120 days fo r a request under subparagraphs (a) and (b). If the 
panel determines that the level of benefits proposed  to be suspended is manifestly excessive, it shall 
determine the level of be nefits it considers to be of equivalent effect. 
 
                                                     
 
1 Compensation, the payment of monetary assessments, and the suspension of benefits are intended as 
temporary measures pending the elimination of any non-co nformity or nullification or impairment that the panel 
has found. WT/REG160/1 
Page 214  
 
4. The complaining Party may suspend benefits up to the level the panel has determined under 
paragraph 3 or, if the panel has not determined the level, the level the Party has proposed to suspend 
under paragraph 2, unless the panel ha s determined that the Party comp lained against has eliminated 
the non-conformity or the nullification or impairment.  
5. The complaining Party may not suspend benefits  if, within 30 days after it provides written 
notice of intent to suspend benefits or, if the pa nel is reconvened under para graph 3, within 20 days 
after the panel provides its determination, the Part y complained against provides written notice to the 
other Party that it will pay an annual monetary ass essment. The Parties shal l consult, beginning no 
later than 10 days after the Party complained against provides notice, with a view to reaching 
agreement on the amount of the assessment. If the Par ties are unable to reach an agreement within 30 
days after consultations begin, the amount of the asse ssment shall be set at a level, in U.S. dollars, 
equal to 50 percent of the level of the benefits the panel has determined unde r paragraph 3 to be of 
equivalent effect or, if the panel has not determ ined the level, 50 percent of the level that the 
complaining Party has proposed to suspend under paragraph 2. 
6. Unless the Commission otherwise decides, a monetary assessment shall be paid to the 
complaining Party in U.S. currency, or in an e quivalent amount of Chilean  currency, in equal, 
quarterly installments beginning 60 da ys after the Party complained against gives notice that it intends 
to pay an assessment. Where the circumstances warrant, the Commission may decide that an 
assessment shall be paid into a fund established by  the Commission and expended at the direction of 
the Commission for appropriate initiatives to facilitate  trade between the Parties, including by further 
reducing unreasonable trade barriers or by assisting a Party in carrying out its obligations under the 
Agreement. 
7. If the Party complained against fails to pay a monetary assessment, the complaining Party 
may suspend the application to the Party complain ed against of benefits in accordance with   
paragraph 4. 
8. This Article shall not apply with respect to a matter described in Article 22.16(1). 
Article 22.16 
 
Non-Implementation In Certain Disputes
 
 1. If, in its final report, a panel determines that  a Party has not conformed with its obligations 
under Article 18.2(1)(a) (Enforcement of Labor Laws) or Article 19.2(1)(a) (Enforcement of 
Environmental Laws), and the Parties: 
(a) are unable to reach agreement on a resolution pursuant to Article 22.14 within 45 
days of receiving the final report; or 
(b) have agreed on a resolution pursuant to Article 22.14 and the complaining Party 
considers that the other Party has failed to observe the terms of the agreement, 
the complaining Party may at any time thereafter request that the panel be reconvened to impose an 
annual monetary assessment on the other Party. The complaining Party shall deliver its request in 
writing to the other Party. The panel shall reconve ne as soon as possible after delivery of the request. 
 2. The panel shall determine the amount of the m onetary assessment in U.S. dollars within 90 
days after it reconvenes under paragraph 1. In de termining the amount of the assessment, the panel 
shall take into account:  
(a) the bilateral trade effects of the Party’s failu re to effectively enforce the relevant law;  WT/REG160/1 
 Page 215 
 
 
(b) the pervasiveness and duration of the Part y’s failure to effectively enforce the 
relevant law; 
(c) the reasons for the Party’s failure to effectively enforce the relevant law; 
(d) the level of enforcement that could reasona bly be expected of the Party given its 
resource constraints; 
(e) the efforts made by the Party to begin remedying the non-enforcement after the final 
report of the panel, including through th e implementation of any mutually agreed 
action plan; and 
(f) any other relevant factors. 
The amount of the assessment shall not exceed 15 m illion dollars annually, adjusted for inflation as 
specified in Annex 22.16. 
 3. On the date on which the panel determines the amount of the monetary assessment under 
paragraph 2, or at any time thereafter, the comp laining Party may provide notice in writing to the 
other Party demanding payment of the monetary assessment. The monetary assessment shall be 
payable in U.S. currency, or in an equivalent amount of Chilean currency, in equal, quarterly, 
installments beginning 60 days after the complaining Party provides such notice. 
4. Assessments shall be paid into a fund estab lished by the Commission and shall be expended 
at the direction of the Commission for appropriate labor or environmental initiatives, including efforts 
to improve or enhance labor or environmental law en forcement, as the case may be, in the territory of 
the Party complained against, consistent with its law. In deciding how to expend monies paid into the 
fund, the Commission shall consider the views of interested persons in the Parties’ territories. 
5. If the Party complained against fails to pay a monetary assessment, the complaining Party 
may take other appropriate steps to collect the assessment or otherwise secure compliance. These steps may include suspending tariff benefits und er the Agreement as necessary to collect the 
assessment, while bearing in mind the Agreement’s obj ective of eliminating barriers to bilateral trade 
and while seeking to avoid unduly affecting parti es or interests not party to the dispute. 
Article 22.17 
 
Compliance Review
 
 1. Without prejudice to the procedures set out in Article 22.15(3), if the Party complained 
against considers that it has eliminated the non-confor mity or the nullification or impairment that the 
panel has found, it may refer the matter to the pane l by providing written notice to the other Party. 
The panel shall issue its report on the matter with in 90 days after the Party complained against 
provides notice. 
2. If the panel decides that the Party complained against has eliminated the nonconformity or the 
nullification or impairment, the complaining Part y shall promptly reinstate any benefits it has 
suspended under Article 22.15 or 22.16 and the Part y complained against shall no longer be required 
to pay any monetary assessment it has agreed to pa y under Article 22.15(5) or that has been imposed 
on it under Article 22.16(1). 
 
 
 WT/REG160/1 
Page 216  
 
Article 22.18 
 
Five-Year Review
 
  The Commission shall review the operation and effectiveness of Articles 22.15 and 22.16 not 
later than five years after the Agreement enters into  force, or within six months after benefits have 
been suspended or monetary assessments have been imposed in five proceedings initiated under this 
Chapter, whichever occurs first.  
Article 22.19 
 
Referral Of Matters From Judicial Or Administrative Proceedings
 
 1. If an issue of interpretation or application of th is Agreement arises in any domestic judicial or 
administrative proceeding of a Party that any Party co nsiders would merit its intervention, or if a court 
or administrative body solicits the views of a Part y, that Party shall notify the other Party. The 
Commission shall endeavor to agree on an appr opriate response as expeditiously as possible. 
2. The Party in whose territory the court or ad ministrative body is located shall submit any 
agreed interpretation of the Commission to the c ourt or administrative body in accordance with the 
rules of that forum. 
3. If the Commission is unable to agree, either Party may submit its own views to the court or 
administrative body in accordance with  the rules of that forum.  
Article 22.20 
 
Private Rights
 
 
 Neither Party may provide for a right of acti on under its domestic law against the other Party 
on the ground that a measure of the other Part y is inconsistent with this Agreement. 
 
Article 22.21 
 
Alternative Dispute Resolution  
 
1. Each Party shall, to the maximum extent po ssible, encourage and facilitate the use of 
arbitration and other means of alternative disput e resolution for the settlement of international 
commercial disputes between private parties in the free trade area. 
2. To this end, each Party shall provide appropr iate procedures to ensure observance of 
agreements to arbitrate and for the recognition and en forcement of arbitral awards in such disputes. 
3. A Party shall be deemed to be in compliance w ith paragraph 2 if it is a party to and is in 
compliance with the 1958 United Nations Convention on the R ecognition and Enforcement of Foreign 
Arbitral Awards  or the 1975 Inter-American Convention on International Commercial Arbitration .  WT/REG160/1 
 Page 217 
 
 
ANNEX 22.2 
 
Nullification Or Impairment  
 1. If either Party considers that any benefit it co uld reasonably have expected to accrue to it 
under any provision of: 
(a) Chapters Three through Five (National Treatment and Market Access for Goods, 
Rules of Origin and Origin Procedures, and Customs Administration);  
(b) Chapter Seven (Technical Barriers to Trade); 
(c) Chapter Nine (Government Procurement); 
(d) Chapter Eleven (Cross-Border  Trade in Services); or 
(e) Chapter Seventeen (Intellectual Property Rights), 
is being nullified or impaired as a result of the applic ation of any measure that is not inconsistent with 
this Agreement, the Party may have recour se to dispute settlement under this Chapter. 
 
2. Neither Party may invoke paragraph 1(d) or (e ) with respect to any measure subject to an 
exception under Article 23.1 (General Exceptions). 
 
ANNEX 22.16 
 
Inflation Adjustment Formula For Monetary Assessments
 
 
1. An annual monetary assessment imposed before  December 31, 2004 shall not exceed 15 
million dollars (U.S.). 
2. Beginning January 1, 2005, the 15 million dollar (U.S.) annual cap shall be adjusted for 
inflation in accordance with paragraphs 3 through 5. 
3. The period used for the accumulated inflation adjustment shall be calendar year 2003 through 
the most recent calendar year preceding the one in which the assessment is owed. 
4. The relevant inflation rate shall be the U.S. inflation rate as measured by the Producer Price 
Index for Finished Goods published by the U.S. Bureau of Labor Statistics. 
5. The inflation adjustment shall be estimat ed according to the following formula:  
 $15 million x (1+ ∏i) = A 
 
∏i = accumulated U.S. inflation rate from cal endar year 2003 through the most recent 
calendar year preceding the one in which the assessment is owed. 
  A =  cap for the assessment for the year in question. 
 
 
 WT/REG160/1 
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CHAPTER TWENTY-THREE : EXCEPTIONS 
 
Article 23.1 
 
General Exceptions
 
 
1. For purposes of Chapters Three through Seven (National Treatment and Market Access for 
Goods, Rules of Origin and Origin Procedures, Cu stoms Administration, Sanitary and Phytosanitary 
Measures, and Technical Barriers to Trade), Article XX of GATT 1994 and its interpretive notes are incorporated into and made part of this Agreement, mutatis mutandis . The Parties understand that the 
measures referred to in Article XX(b) of GATT 1994 include environmental measures necessary to 
protect human, animal, or plant life or health, and that Article XX(g) of GATT 1994 applies to 
measures relating to the conservation of living and non-living exhaustible natural resources. 
2. For purposes of Chapters Eleven, Thirteen, and Fifteen
1 (Cross-Border Trade in Services, 
Telecommunications, and Electronic Commerce), Artic le XIV of GATS (including its footnotes) is 
incorporated into and made part of this Agreement.2 The Parties understand that the measures referred 
to in Article XIV(b) of GATS include environmental measures necessary to protect human, animal, or plant life or health.  
Article 23.2 
 
Essential Security
 
 
 Nothing in this Agreem ent shall be construed: 
 
(a) to require a Party to furnish or allow access to any information the disclosure of 
which it determines to be contrary to its essential security interests; or 
(b) to preclude a Party from applying measure s that it considers necessary for the 
fulfillment of its obligations under the Unite d Nations Charter with respect to the 
maintenance or restoration of international peace or security, or the protection of its 
own essential security interests. 
Article 23.3 
 
Taxation  
 1. Except as set out in this Article, nothing in th is Agreement shall apply to taxation measures. 
2. Nothing in this Agreement shall affect the right s and obligations of either Party under any tax 
convention. In the event of any inconsistency betw een this Agreement and any such convention, that 
convention shall prevail to the extent of the incons istency. In the case of a tax convention between the 
Parties, the competent authorities under that convent ion shall have sole responsibility for determining 
whether any inconsistency exists between  this Agreement and that convention. 
3. Notwithstanding paragraph 2: 
                                                     
 
1 This Article is without prejudice to whether digital products should be classified as goods or services. 
2 If Article XIV of GATS is amended, this Article shall be amended, as appropriate, after consultations 
between the Parties.  WT/REG160/1 
 Page 219 
 
 
(a) Article 3.2 (Market Access – National Treatment) and such other provisions of this 
Agreement as are necessary to give effect  to that Article shall apply to taxation 
measures to the same extent as does Article III of the GATT 1994; and 
(b) Articles 3.13 (Market Access – Export Taxes) and 3.14 (Market Access – Luxury 
Tax) shall apply to taxation measures. 
4. Subject to paragraph 2: 
(a) Article 11.2 (Cross-Border Trade in Services – National Treatment) and Article 12.2 
(Financial Services – National Treatment) shall apply to taxation measures on income, capital gains, or on the taxable cap ital of corporations that relate to the 
purchase or consumption of particular services, except that nothing in this 
subparagraph shall prevent a Party from conditioning the receipt or continued receipt 
of an advantage relating to the purchase or consumption of particular services on 
requirements to provide the service in its territory; and 
(b) Articles 10.2 (Investment – National Tr eatment) and 10.3 (Investment –Most-
Favored-Nation Treatment), Articles 11.2 (Cross-Border Trade in Services – National 
Treatment) and 11.3 (Cross-Border Trad e in Services – Most-Favored Nation 
Treatment), and Articles 12.2 (Financial Services – National Treatment) and 12.3 (Financial Services – Most-Favored-Nation Treatment) shall apply to all taxation measures, other than those on income, capital gains, or on the taxable capital of corporations, taxes on estates, inheritances, gi fts, and generation-skipping transfers,  
except that nothing in those Articles shall apply: 
 
(c) any most-favored-nation obligation with resp ect to an advantage accorded by a Party 
pursuant to a tax convention; 
(d) to a non-conforming provision of any existing taxation measure; 
(e) to the continuation or prompt renewal of  a non-conforming provision of any existing 
taxation measure; 
(f) to an amendment to a non-conforming provi sion of any existing taxation measure to 
the extent that the amendment does not decr ease its conformity, at  the time of the 
amendment, with any of those Articles; 
(g) to the adoption or enforcement of any taxation measure aimed at ensuring the 
equitable or effective imposition or coll ection of taxes (as permitted by Article 
XIV(d) of GATS); 
(h) to a provision that conditions the receipt, or continued receipt, of an advantage 
relating to the contributions to, or income  of, pension trusts or pension plans on a 
requirement that the Party maintain conti nuous jurisdiction over the pension trust or 
pension plan; or 
(i) to any excise tax on insurance premiums adopt ed by Chile to the extent that such tax 
would, if levied by the United States, be covered by subparagraphs  (d), (e), or (f). 
5. Subject to paragraph 2 and without prejudice to the rights and obligations of the Parties under 
paragraph 3, Article 10.5(2), (3), and (4) (Invest ment – Performance Requirements) shall apply to 
taxation measures. WT/REG160/1 
Page 220  
 
6. Article 10.9 (Expropriation and Compensation) and Article 10.15 (Submission of a Claim to 
Arbitration) shall apply to a taxation measure alle ged to be an expropriation or a breach of an 
investment agreement or investment authorization.  However, no investor may invoke Article 10.9 as 
the basis of a claim where it has b een determined pursuant to this paragraph that the measure is not an 
expropriation. An investor that seeks to invoke Artic le 10.9 with respect to a taxation measure must 
first refer to the competent authorities set out in Annex 23.3 at the time that it gives its notice of intent 
under Article 10.15(4) the issue of whether that taxation measure involves an expropriation. If the 
competent authorities do not agree to consider the issu e or, having agreed to consider it, fail to agree 
that the measure is not an expropriation within a pe riod of six months of such referral, the investor 
may submit its claim to arb itration under Article 10.15. 
Article 23.4 
 
Balance Of Payments Measures On Trade In Goods
 
  Should a Party decide to impose measures for balance of payments purposes, it shall do so 
only in accordance with that Party’s rights a nd obligations under GA TT 1994, including the 
Declaration on Trade Measures Taken for Balance of Payments Purposes  (1979 Declaration) and the 
Understanding on the Balance of Payments Provisions of the GATT 1994  (BOP Understanding). In 
adopting such measures, the Party shall immediately consult with the other Party and shall not impair 
the relative benefits accorded to the other Party under this Agreement.
3 
 
Article 23.5 
 
Disclosure Of Information  
  Nothing in this Agreement sha ll be construed to require a Part y to furnish or allow access to 
information the disclosure of which would impede law enforcement or would be contrary to the 
Party’s law protecting personal privacy or the fina ncial affairs and accounts of individual customers 
of financial institutions.  
Article 23.6 
 
Definitions
 
  For purposes of this Chapter:   tax convention  means a convention for the avoidance of double taxation or other 
international taxation agreement or arrangement; and  
  taxes and taxation measures  do not include: 
 
(a) a customs duty; or 
(b) the measures listed in exceptions (b) and (c) of the definition of customs duty. 
                                                     
 
3 For greater certainty, this Article applies to bala nce of payments measures imposed on trade in goods.  WT/REG160/1 
 Page 221 
 
 
ANNEX 23.3 
 
Competent Authorities  
  For purposes of this Chapter: 
 
 competent authorities  means 
 
(a) in the case of Chile, the Director del Servicio de Impuestos Internos, Ministerio de 
Hacienda ; and 
(b) in the case of the United States, the Assistan t Secretary of the Treasury (Tax Policy), 
Department of the Treasury. 
 
CHAPTER TWENTY-FOUR : FINAL PROVISIONS 
 
Article 24.1 
 
Annexes, Appendices, And Footnotes
 
  The Annexes, Appendices, and footnotes to this Ag reement constitute an integral part of this 
Agreement. 
 
Article 24.2 
 
Amendments
 
 
1. The Parties may agree on any modification of or addition to this Agreement. 
2. When so agreed, and approved in accordance with the applicab le legal procedures of each 
Party, a modification or addition shall constitu te an integral part of this Agreement. 
Article 24.3 
 
Amendment Of The WTO Agreement  
 
 If any provision of the WTO Agreement that the Parties have incorporated into this Agreement is amended, the Parties shall c onsult on whether to amend this Agreement. 
 
Article 24.4 
 
Entry Into Force And Termination
 
 1. The entry into force of this Agreement is s ubject to the completion of necessary domestic 
legal procedures by each Party. 
2. This Agreement shall enter into force 60 days after the date on which the Parties exchange 
written notification that such procedures have been co mpleted, or after such other period as the Parties 
may agree. 
3. Either Party may terminate this Agreement by written notification to the other Party. This 
Agreement shall expire 180 days afte r the date of such notification. WT/REG160/1 
Page 222  
 
Article 24.5 
 
Authentic Texts
 
  The English and Spanish texts of th is Agreement are equally authentic. 
 
 IN WITNESS WHEREOF , the undersigned, being duly authorized by their respective 
Governments, have si gned this Agreement. 
  DONE  at Miami, in duplicate, this sixth day of June, 2003. 
 
 
 FOR THE GOVERNMENT OF THE FOR THE GOVERNMENT OF THE 
 UNITED STATES OF AMERICA:  REPUBLIC OF CHILE: 
    [s/ Robert B. Zoellick]  [s/ María Soledad Alvear Valenzuela] 
  
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