. /.   WORLD TRADE  
ORGANIZATION  WT/REG239/2 
8 September 2009 
 
 (09-4233) 
Committee on Regional Trade Agreements Original:   English/ 
 Spanish 
 
 
 
FREE TRADE AGREEMENT BETWEEN CHILE AND PANAMA 
(GOODS AND SERVICES) 
 
Questions and Replies  
 
  The following communication, dated 4 September 2009, is being circulated at the request of the delegations of Chile and Panama.  
 This document reproduces the questions addressed to the parties and the responses submitted. 
 
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Question from the delegation of Australia
 
 
1. We note that Chile has excluded wheat and flour, and sugar, from the Treaty's 
coverage.  Is there any provision to liberalize these products in future?  
 
 Chile has made no provision to liberalize th ese products in future under this FTA with 
Panama. 
 
Questions from the delegation of Brazil  
 
2. Why has mode 3 in services been skipped from the coverage of the services agreement?  
  Mode 3 has been excluded from the coverage of  the chapter on cross-border trade in services 
because Chile's policy is to negotiate chapters on cross-border trade in services (modes 1, 2 and 4) 
separate from the chapters on investment (which incorporate mode 3).  As regards investment, 
Chapter 9 (Trade and Investment), Article 9.2, includes the Agreement on Reciprocal Promotion and 
Protection of Investments (ARPPI) in force between  Chile and Panama as part of the text of the 
Agreement in that it contains confirmation of th e obligations assumed under the ARPPI.  In addition, 
it contains a commitment to improve the rules and disciplines established under the ARPPI.  
3. Does Chile use the 85 per cent threshold of local workers as a common standard in the 
FTA?  
 
 This threshold was establishe d in Law-Ranking Decree No. 1 of the Ministry of Labour and 
Social Security (Labour Code).  This measure wa s reserved by Chile under all the FTAs with negative 
lists.  It was also reserved by Chile in the ag reements negotiated with positive list schemes (under the 
horizontal commitments).  WT/REG239/2 
Page 2  
 
  4. As mentioned in paragraph 86, both count ries apply restrictions to MFN obligations.  
What are exactly those ex emptions and countermeasures?  
 
 These exemptions are listed in Annexes I and II on non-conforming measures and future 
measures for each one of the signatory countries.  Chile's exemptions are listed in Table IV.1 
(pages 31 and 32) and Panama's in Table IV.2 (p age 34) of the Report of the Secretariat. 
 
5. What are the criteria to fulfil "substantial commercial activities" requirements 
mentioned in paragraph 81?  
  There is no list of established criteria in the Agreement. 
 
6. Are the preferences granted for goods pr oduced with materials imported with 
suspension or elimination of duties and taxes?  
  The tariff preferences provided for under the Ag reement are granted for all goods originating 
in one party that are imported to the other party.  The goods subject to special regimes involving suspension or elimination of duties and tax es must comply with multilateral commitments. 
 
7. Are there any plans to implement digital certificates of origin, with digital signature?  
  Chile is promoting initiatives aimed at impl ementing certification of origin processes in 
which the documents are issued in electronic form us ing digital signature.  The text of the Agreement 
does not specifically provide for the possibility of using and issuing certificates of origin in electronic form, and because we are dealing with a system of sel f-certification of origin, it is a bit more difficult 
to implement.  However, the possibility has not been  excluded, provided agr eement can be reached by 
both parties within the legal framework of the Agreement. 
 
Questions from the delegation of the European Communities
 
 
8. Could the parties explain the reasons for not having included commitments on financial 
services?  
 
 The parties agreed to negotiate commitments on financial services at a later date so as not to 
delay the conclusion of the FTA negotiations as a whole.  
9. Do the parties have any plans to include them at a later stage?  
 
 Article 15.3 of Chapter 15 (Final Provisions) contains the commitment to negotiate this chapter in the future (two years after the entry into force of the Agreement). 
 
Question from the delegation of Japan
 
 
10. Japan would like to know which article contai ns commitments with respect to mode 4 in 
trade in services.  
 
 Mode 4 is included in Chapter 10 on cross-bor der trade in services (Article 1 – Scope of 
Application – subparagraph (d):  "the presence in th eir territory of a services supplier of the other 
Party;").  All of the relevant articles of this Ch apter apply to mode 4, subject to the reservations 
contained in Annexes I and II.  
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