WT/REG344/2  
16 September 2014  
(14-5148)  Page: 1/3  
Committee on Regional Trade Agreements  Original: English/Spanish  
 
   FREE TRADE AGREEMENT BETWEEN CHILE AND NICARAGUA 
(GOODS AND SERVICES) 
QUESTIONS AND REPLIES 
The following communication, dated 9 September 2014,  is being circulated at the request of the 
delegations of Chile and Nicaragua.  
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  This document reproduces the questions addressed to the Parties and the responses submitted. 
 
Questions from the delegation of the European Union 
4.2.4 Performance requirements 
1.1.  Performance Requirements may co ver all aspects of investment. 
Therefore, investment chapters – as used al so in FTAs – normally include a prohibition 
of Performance Requirements in relation to  TRIMS and to existing other international 
agreements, the most important being the WTO Agreement on Subsidies and 
countervailing duties. 
a. Could the parties clarify whether it is also the case in the Chile – Nicaragua 
Agreement? 
The FTA between Chile and Central America does not include a chapter on investment. 
It does, however, incorporate the reciprocal investment promotion and protection agreement (APPRI) between Chile and Nicaragua, which does not include performance 
requirement disciplines. 
b. Moreover, could the parties clarify whet her this prohibition is valid for all 
investment (also from third countries) or  only for investors between Nicaragua 
and Chile? 
As mentioned above, the bilateral APPRI does not include performance requirement 
disciplines. 
c. How do the rules on Performance Requ irements applicable for Financial 
Services as specified in para 4.14 di ffer from the "General principles that 
Parties shall endeavour to apply" in para 4.13? 
Paragraph 4.14 refers to the mandatory requirements and procedures for granting a 
permit or licence to provide a service. Article 11.07 of the FTA applies to cross-border 
provision of services and states that the pr ocedures followed by the parties to grant 
licences shall be transparent, objective and not more burdensome than necessary and 
shall not constitute a disguised restriction on trade in services. 
Paragraph 4.13 refers to local presence requirements. WT/REG344/2 
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  4. PROVISIONS ON TRADE IN SERVICES 
4.3.2 Liberalization commitments – Nicaragua 1.2.  How does the requirement cited in para 4.48  (a general reservation, for all sectors, 
requires of companies established in Nicara gua that at least 90% of their staff are 
Nicaraguan) comply with the provisions on Performance Requirements cited in 
paras 4.14 and 4.15? 
As stated above, paragraphs 4.14 and 4.15 do not refer to performance requirements as such, but 
to mandatory requirements for granting licences . However, the general reservation regarding 90% 
of staff is an existing provision that is in line with the national labour code which Nicaragua usually includes in its agreements in order to boost employment and the social well-being that results from investment in the country. 
4.5.4 Transparency 
1.3.  Para 4.75 mentions the possibility of d eeping the investment relations between 
Nicaragua and Chile through the possibilit y "to develop and expend the rules and 
disciplines in the Investment Agreement,  which would then become part of the 
Agreement (Article 10.02)". The report mentio ns that a consensus has not been reached 
so far. Could the Nicaraguan and Chilean  side update on envisaged further? 
It is in Chile's interest to update the normative framework for its investment relations with 
Central America. The negotiation of a chapter on investment between Chile and Central America should enjoy the consensus of all parties in light of the multilateral application of the provisions of the FTA. 
Question from the delegation of Peru 
 
Provisions on trade in goods 
Regulatory provisions on trade in goods 
Standards Technical barriers to trade (TBT)  
 
1.4.  Paragraph 3.33: What are the most striking additional sp ecific disciplines included 
in the TBT chapter? 
The additional specific disciplines in this Chapter include, inter alia , risk assessment, metrology 
and the Annex on services sectors and subsectors, while other disciplines already established in 
the TBT Agreement have been broadened. Some of  the additional specific disciplines in this 
Chapter are set out hereunder: 
a. Article 9.05 on Risk Assessment, which provides that a Party may, in pursuing its 
legitimate objectives, conduct an assessment of risk taking into account a number of elements, which will enable it to establish an appropriate level of protection and avoid 
the application of arbitrary or unjustifiable measures to similar goods or similar services. 
This Article also establishes provisions on transparency and enhanced communication between the competent bodies in order to ensure the availability of the relevant documentation on their risk-assessment processes and the factors taken into account in 
establishing the legitimate levels of protection. 
b. Article 9.09 on Metrological Standards, which provides that "Each Party shall, as far as 
practicable, ensure the traceability of its metrological standards in accordance with the 
recommendations of the International Bureau of Weights and Measures (BIPM) and the 
International Organization of Legal Metrology (OIML), complying with the principles established in this Chapter". WT/REG344/2 
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  c. Article 9.10 on Notification, which provides, inter alia , that "each Party shall notify the 
other Parties in writing of the proposed measure at least sixty (60) days in advance of its adoption, to enable interested parties to submit comments and consultations during that period and permit the notifying Party to take them into account". 
d. The establishment of a Committee on Standardization, Metrology and Approval 
Procedures (Article 9.12), which is assigned a set of duties intended to strengthen the communication channels amongst the bodies responsible for implementing the various 
provisions of this Chapter. 
e. Article 9.13 on Technical Cooperation, which encourages standardization and metrology 
bodies to share information and technical assistance on mutually agreed terms. 
f. Annex 9.01 on Services Sectors and Subsectors, which provides that Computer and 
Related Services (Division 84) are subject to this Chapter. 
g. Article 9.06 on Compatibility and Equivalence, which provides that, taking into account 
international standardization activities, the Parties shall, to the greatest extent 
practicable, make compatible their respective standards-related measures without 
reducing the level of safety or of protection of human, animal or plant life or health, the environment or consumers. In the event of a request being rejected, the importing Party 
shall provide in writing its reasons for not treating the technical regulation as equivalent. 
h. Article 9.08 on Approval Procedures (equiv alent to the application of conformity 
assessment procedures). 
i. Article 9.11 on Enquiry Points, which provides that each Party shall have a designated 
entity in charge of responding to all questions and reasonable enquiries from the other 
Parties and interested persons and providing relevant, up-to-date documents regarding any adopted or proposed standards-related measure, approval procedure or 
metrology-related measure. 
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