02019A1114(01) — EN — 17.04.2020 — 001.001

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Amended by:









▼B

FREE TRADE AGREEMENT BETWEEN THE EUROPEAN UNION AND THE REPUBLIC OF SINGAPORE







The European Union, hereinafter referred to as ‘the Union’, and the Republic of Singapore, hereinafter referred to as ‘Singapore’, hereinafter jointly referred to as the ‘Parties’ or individually referred to as a ‘Party’, RECOGNISING their longstanding and strong partnership based on the common principles and values reflected in the Partnership and Cooperation Agreement, and their important economic, trade and investment relationship; DESIRING to further strengthen their relationship as part of and in a manner coherent with their overall relations, and convinced that this Agreement will create a new climate for the development of trade and investment between the Parties; RECOGNISING that this Agreement will complement and promote regional economic integration efforts; DETERMINED to strengthen their economic, trade, and investment relations in accordance with the objective of sustainable development, in its economic, social and environmental dimensions, and to promote trade and investment in a manner mindful of high levels of environmental and labour protection and relevant internationally-recognised standards and agreements to which they are party; DESIRING to raise living standards, promote economic growth and stability, create new employment opportunities and improve the general welfare and, to this end, reaffirming their commitment to promoting trade and investment liberalisation; CONVINCED that this Agreement will create an expanded and secure market for goods and services, thus enhancing the competitiveness of their firms in global markets; REAFFIRMING each Party's right to adopt and enforce measures necessary to pursue legitimate policy objectives such as social, environmental, security, public health and safety, promotion and protection of cultural diversity; REAFFIRMING their commitment to the Charter of the United Nations signed in San Francisco on 26 June 1945 and having regard to the principles articulated in the Universal Declaration of Human Rights adopted by the General Assembly of the United Nations on 10 December 1948; RECOGNISING the importance of transparency in international trade to the benefit of all stakeholders; SEEKING to establish clear and mutually advantageous rules governing their trade and investment and to reduce or eliminate the barriers to mutual trade and investment; RESOLVED to contribute to the harmonious development and expansion of international trade by removing obstacles to trade through this Agreement and to avoid creating new barriers to trade or investment between the Parties that could reduce the benefits of this Agreement; BUILDING on their respective rights and obligations under the WTO Agreement and other multilateral, regional and bilateral agreements and arrangements to which they are party, HAVE AGREED AS FOLLOWS:







CHAPTER ONE

OBJECTIVES AND GENERAL DEFINITIONS

ARTICLE 1.1

Establishment of a Free Trade Area

The Parties to this Agreement hereby establish a free trade area, consistent with Article XXIV of GATT 1994 and Article V of GATS.

ARTICLE 1.2

Objectives

The objectives of this Agreement are to liberalise and facilitate trade and investment between the Parties in accordance with the provisions of this Agreement.

ARTICLE 1.3

Definitions of General Application

For the purposes of this Agreement, unless otherwise specified:

‘Agreement on Agriculture’ means the Agreement on Agriculture contained in Annex 1A of the WTO Agreement;

‘Agreement on Government Procurement’ means the Agreement on Government Procurement contained in Annex 4 of the WTO Agreement;

‘Agreement on Preshipment Inspection’ means the Agreement on Preshipment Inspection contained in Annex 1A of the WTO Agreement;

‘Anti-Dumping Agreement’ means the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 contained in Annex 1A of the WTO Agreement;

‘Customs Valuation Agreement’ means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 contained in Annex 1A of the WTO Agreement;

‘day’ means a calendar day;

‘DSU’ means the Understanding on Rules and Procedures Governing the Settlement of Disputes contained in Annex 2 of the WTO Agreement;

‘GATS’ means the General Agreement on Trade in Services contained in Annex 1B of the WTO Agreement;

‘GATT 1994’ means the General Agreement on Tariffs and Trade 1994 contained in Annex 1A of the WTO Agreement;

‘Harmonized System’ means the Harmonized Commodity Description and Coding System, including all legal notes and amendments thereto (hereinafter also referred to as the ‘HS’);

‘IMF’ means the International Monetary Fund;

‘Import Licensing Agreement’ means the Agreement on Import Licencing Procedures contained in Annex 1A of the WTO Agreement;

‘measure’ means any law, regulation, procedure, requirement or practice;

‘natural person of a Party’ means a national of Singapore, or of one of the Member States of the Union ( 1 ), according to their respective legislation;

‘Partnership and Cooperation Agreement’ means the Partnership and Cooperation Agreement between the European Union and its Member States, of the one part, and the Republic of Singapore, of the other part, signed in Brussels on 19 October 2018;

‘person’ means a natural person or a juridical person;

‘Safeguards Agreement’ means the Agreement on Safeguards contained in Annex 1A of the WTO Agreement;

‘SCM Agreement’ means the Agreement on Subsidies and Countervailing Measures contained in Annex 1A of the WTO Agreement;

‘SPS Agreement’ means the Agreement on the Application of Sanitary and Phytosanitary Measures contained in Annex 1A of the WTO Agreement;

‘TBT Agreement’ means the Agreement on Technical Barriers to Trade contained in Annex 1A of the WTO Agreement;

‘TRIPS Agreement’ means the Agreement on Trade-Related Aspects of Intellectual Property Rights contained in Annex 1C of the WTO Agreement;

‘WIPO’ means the World Intellectual Property Organization;

‘WTO’ means the World Trade Organization; and

‘WTO Agreement’ means the Marrakesh Agreement Establishing the World Trade Organization done at Marrakesh on 15 April 1994.







CHAPTER TWO

NATIONAL TREATMENT AND MARKET ACCESS FOR GOODS







SECTION A

COMMON PROVISIONS

ARTICLE 2.1

Objective

The Parties shall progressively and reciprocally liberalise trade in goods over a transitional period starting from the entry into force of this Agreement in accordance with this Agreement and in conformity with Article XXIV of GATT 1994.

ARTICLE 2.2

Scope

This Chapter applies to trade in goods between the Parties.

ARTICLE 2.3

National Treatment

Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of GATT 1994, including its Notes and Supplementary Provisions. To this end, the obligations contained in Article III of GATT 1994, including its Notes and Supplementary Provisions, are incorporated into and made part of this Agreement, mutatis mutandis.

ARTICLE 2.4

Customs Duty

For the purposes of this Chapter, a customs duty includes any duty or charge of any kind imposed on or in connection with the importation or exportation of a good, including any form of surtax or surcharge imposed on or in connection with such importation or exportation.

A customs duty does not include any:

(a) charge equivalent to an internal tax imposed consistently with Article 2.3 (National Treatment);

(b) duty imposed consistently with Chapter Three (Trade Remedies);

(c) duties applied consistently with Article VI, Article XVI, Article XIX of GATT 1994, the Anti-Dumping Agreement, the SCM Agreement, Article 5 of the Agreement on Agriculture and the DSU; and

(d) fee or other charge imposed consistently with Article 2.10 (Fees and Formalities Connected with Importation and Exportation).

ARTICLE 2.5

Classification of Goods

The classification of goods in trade between the Parties shall be governed by each Party's respective tariff nomenclature in conformity with the HS and its amendments.







SECTION B

REDUCTION OR ELIMINATION OF CUSTOMS DUTIES

ARTICLE 2.6

Reduction or Elimination of Customs Duties on Imports

1. Each Party shall reduce or eliminate its customs duties on imported goods originating in the other Party in accordance with the Schedules set out in Annex 2-A. For the purposes of this Chapter, ‘originating’ means the origin of a good as determined in accordance with the rules of origin and the other requirements set out in Protocol 1.

2. The base rate of customs duties on imports, to which the successive reductions are to be applied under paragraph 1, shall be that specified in the Schedules in Annex 2-A.

3. If at any moment a Party reduces its applied most favoured nation (hereinafter referred to as ‘MFN’) customs duty rates on imports after the date of entry into force of this Agreement, that duty rate shall apply if and for as long as it is lower than the customs duty rate on imports calculated in accordance with its Schedule in Annex 2-A.

4. Three years after the entry into force of this Agreement, at the request of either Party, the Parties shall consult to consider accelerating and broadening the scope of the reduction and elimination of customs duties on imports. A decision by the Parties in the Committee on Trade in Goods on such acceleration or broadening shall supersede any duty rate or staging category determined pursuant to their Schedules for that good.

ARTICLE 2.7

Elimination of Customs Duties and Taxes on Exports

Neither Party shall maintain or institute any customs duty or tax on, or in connection with the exportation or sale for export of, goods to the other Party, or any internal taxes on goods exported to the other Party that are in excess of those imposed on like goods destined for internal sale.

ARTICLE 2.8

Standstill

Upon the entry into force of this Agreement, neither Party shall increase any existing customs duty, or introduce any new customs duty, on the importation of a good originating in the other Party. This shall not preclude either Party from raising a customs duty to the level established in its Schedule in Annex 2-A following a unilateral reduction.







SECTION C

NON-TARIFF MEASURES

ARTICLE 2.9

Import and Export Restrictions

1. Neither Party shall adopt or maintain any prohibition or restriction on the importation of any good of the other Party or on the exportation or sale for export of any good destined for the territory of the other Party, in accordance with Article XI of GATT 1994, including its Notes and Supplementary Provisions. To that end, Article XI of GATT 1994, including its Notes and Supplementary Provisions are incorporated into and made part of this Agreement, mutatis mutandis.

2. The Parties understand that, before taking any measures provided for in subparagraphs 2(a) and 2(c) of Article XI of GATT 1994, the Party intending to take the measures shall supply the other Party with all relevant information, with a view to seeking a solution acceptable to the Parties. The Parties may agree on any means needed to put an end to the difficulties. If no agreement is reached within 30 days of supplying such information, the exporting Party may apply measures under this Article on the exportation of the good concerned. Where exceptional and critical circumstances requiring immediate action make prior information or examination impossible, the Party intending to take the measures may apply forthwith the precautionary measures necessary to deal with the situation, and shall inform the other Party immediately thereof.

ARTICLE 2.10

Fees and Formalities Cnected with Importation and Exportation

1. Each Party shall ensure, in accordance with Article VIII of GATT 1994, including its Notes and Supplementary Provisions, that all fees and charges of whatever character (other than customs duties, and measures listed in paragraphs (a), (b) and (c) of Article 2.4 (Customs Duty)) imposed on, or in connection with the importation or exportation of, goods are limited in amount to the approximate cost of services rendered, which shall not be calculated on an ad valorem basis, and shall not represent an indirect protection to domestic goods or a taxation of imports or exports for fiscal purposes.

2. Each Party shall make available, via an officially designated medium, including through the internet, the fees and charges it imposes in connection with importation and exportation.

3. No Party shall require consular transactions ( 2 ), including the payment of related fees and charges, in connection with the importation of any good of the other Party.

ARTICLE 2.11

Import and Export Licensing Procedures

1. The Parties affirm their existing rights and obligations under the Import Licensing Agreement.

2. The Parties shall introduce and administer any import or export licensing procedures ( 3 ) in accordance with:

(a) Paragraphs 1 to 9 of Article 1 of the Import Licensing Agreement;

(b) Article 2 of the Import Licensing Agreement;

(c) Article 3 of the Import Licensing Agreement.

To that end, the provisions referred to in subparagraphs (a), (b) and (c) of this paragraph are incorporated into and made part of this Agreement. The Parties shall apply those provisions, mutatis mutandis, to any export licensing procedures.

3. Each Party shall ensure that all export licensing procedures are neutral in application and are administered in a fair, equitable, non-discriminatory and transparent manner.

4. Each Party shall only adopt or maintain licensing procedures as a condition for the importation into its territory or the exportation from its territory to the other Party where other appropriate procedures to achieve an administrative purpose are not reasonably available.

5. Neither Party shall adopt or maintain non-automatic import or export licensing procedures unless necessary to implement a measure that is consistent with this Agreement. A Party adopting non-automatic licensing procedures shall clearly indicate the measure being implemented through such licensing procedure.

6. A Party introducing export licensing procedures or changes in these procedures shall notify the Committee on Trade in Goods 60 days in advance of the publication of those procedures. This notification shall contain the information required under Article 5 of the Import Licensing Agreement.

7. A Party shall respond within 60 days to enquiries from the other Party regarding any licensing procedures which the Party to which the request is addressed intends to adopt or has adopted or maintained, as well as the criteria for granting or allocating import or export licences.

ARTICLE 2.12

State Trading Enterprises

1. The Parties affirm their existing rights and obligations under Article XVII of GATT 1994, including its Notes and Supplementary Provisions, and the Understanding on the Interpretation of Article XVII of the General Agreement on Tariffs and Trade 1994, contained in Annex 1-A to the WTO Agreement, which are hereby incorporated into and made part of this Agreement, mutatis mutandis.

2. Each Party may request information from the other Party as provided for in subparagraphs 4(c) and 4(d) of Article XVII of GATT 1994.

ARTICLE 2.13

Elimination of Sectoral Non-Tariff Measures

1. The Parties shall undertake further commitments on sector-specific non-tariff measures on goods as set out in Annex 2-B and Annex 2-C (hereinafter referred to as ‘Sectoral Annexes’). To that end, the Parties may, by decision in the Committee on Trade in Goods, amend the Sectoral Annexes.

2. At the request of a Party, the Parties shall enter into negotiations with the aim of broadening the scope of their commitments on sector-specific non-tariff measures on goods.







SECTION D

SPECIFIC EXCEPTIONS RELATED TO GOODS

ARTICLE 2.14

General Exceptions

1. Nothing in this Chapter shall prevent the taking of measures in accordance with Article XX of GATT 1994, including its Notes and Supplementary Provisions, which are hereby incorporated into and made part of this Agreement, mutatis mutandis.

2. The Parties understand that, before taking any measures provided for in paragraphs (i) and (j) of Article XX of GATT 1994, the exporting Party intending to take the measures shall provide the other Party with all relevant information, with a view to seeking a solution acceptable to the Parties. The Parties may agree on any means needed to put an end to the difficulties. If no agreement is reached within 30 days, the exporting Party may apply measures under this Article on the exportation of the good concerned. Where exceptional and critical circumstances requiring immediate action make prior information or examination impossible, the Party intending to take the measures may apply forthwith the precautionary measures necessary to deal with the situation and shall inform the other Party immediately thereof.







SECTION E

INSTITUTIONAL PROVISIONS

ARTICLE 2.15

Committee on Trade in Goods

1. The Committee on Trade in Goods established pursuant to Article 16.2 (Specialised Committees) shall meet at the request of a Party or the Trade Committee to consider any matter arising under this Chapter and comprise representatives of the Parties.

2. The Committee's functions shall include:

(a) monitoring the implementation of this Chapter and Annexes 2-A, 2-B and 2-C;

(b) promoting trade in goods between the Parties, including through consultations on accelerating and broadening the scope of tariff elimination and broadening of the scope of commitments on non-tariff measures under this Agreement, and on other issues as appropriate; as a result of these consultations, the Committee may, by decision, amend or expand the Annexes 2-A, 2-B and 2-C as required; and

(c) addressing tariff and non-tariff measures to trade in goods between the Parties, and, if appropriate, referring such matters to the Trade Committee for its consideration.







CHAPTER THREE

TRADE REMEDIES







SECTION A

ANTI-DUMPING AND COUNTERVAILING MEASURES

ARTICLE 3.1

General Provisions

1. The Parties affirm their rights and obligations arising under Article VI of GATT 1994, the Anti-Dumping Agreement and the SCM Agreement, and shall apply anti-dumping and countervailing measures in accordance with the provisions of this Chapter.

2. The Parties, recognising that anti-dumping and countervailing measures can be abused to obstruct trade, agree that:

(a) such measures should be used in full compliance with the relevant WTO requirements, and should be based on a fair and transparent system; and

(b) careful consideration should be given to the interests of the Party against which such a measure is to be imposed.

3. For the purpose of this Section, the origin of the goods shall be determined in accordance with the non-preferential rules of origin of the Parties.

ARTICLE 3.2

Transparency and Information Exchange

1. After receipt by a Party's competent authorities of a properly documented anti-dumping application with respect to imports from the other Party, and no later than 15 days before initiating an investigation, that Party shall provide written notification to the other Party of its receipt of the application.

2. After receipt by a Party's competent authorities of a properly documented countervailing duty application with respect to imports from the other Party, and no later than 15 days before initiating an investigation, that Party shall provide written notification to the other Party of its receipt of the application and shall afford the other Party the possibility to consult with its competent authorities regarding the application, with a view to clarifying the factual situation and to arriving at a mutually agreed solution. The Parties shall endeavour to hold these consultations as soon as possible thereafter.

3. Both Parties shall ensure, immediately after any imposition of provisional measures, and in any case before the final determination is made, full and meaningful disclosure of all essential facts and considerations which form the basis for the decision to apply those measures. This is without prejudice to Article 6.5 of the Anti-Dumping Agreement and Article 12.4 of the SCM Agreement. Any disclosure shall be made in writing, and shall allow interested parties sufficient time to make their comments.

4. Each interested party shall be granted the possibility to be heard in order to express their views during trade remedies investigations.

ARTICLE 3.3

Lesser Duty Rule

Should a Party decide to impose any anti-dumping or countervailing duty, the amount of such duty shall not exceed the margin of dumping or countervailable subsidies, and it should be less than the margin if such lesser duty would be adequate to remove the injury to the domestic industry.

ARTICLE 3.4

Consideration of Public Interest

Neither Party shall apply anti-dumping or countervailing measures where, on the basis of the information made available during the investigation, it can clearly be concluded that it is not in the public interest to apply such measures. Public interest shall take into account the situation of the domestic industry, importers and their representative associations, representative users and representative consumer organisations, to the extent they have provided relevant information to the investigating authorities.

ARTICLE 3.5

Exclusion from Bilateral Dispute Settlement and Mediation Mechanism

The provisions of this Section shall not be subject to Chapter Fourteen (Dispute Settlement) and Chapter Fifteen (Mediation Mechanism).







SECTION B

GLOBAL SAFEGUARD MEASURES

ARTICLE 3.6

General Provisions

1. Each Party retains its rights and obligations under Article XIX of GATT 1994, the Safeguards Agreement and Article 5 of the Agreement on Agriculture. Unless otherwise provided for in this Section, this Agreement does not confer any additional rights or obligations on the Parties with regard to actions taken pursuant to Article XIX of GATT 1994 and the Safeguards Agreement.

2. No Party shall apply at the same time with respect to the same good both:

(a) a bilateral safeguard measure; and

(b) a measure under Article XIX of GATT 1994 and the Safeguards Agreement.

3. For the purposes of this Section, the origin of the goods shall be determined in accordance with the non-preferential rules of origin of the Parties.

ARTICLE 3.7

Transparency

1. Notwithstanding Article 3.6 (General Provisions), at the request of the other Party, and provided that the latter has a substantial interest, a Party, when initiating a safeguard investigation or when intending to take safeguard measures, shall immediately provide, at least seven days in advance of the date of such initiation or imposition, ad hoc written notification of all pertinent information leading to the initiation of a safeguard investigation or the imposition of safeguard measures, including on the provisional findings and the final findings of the investigation, where relevant. This is without prejudice to Article 3.2 of the Safeguards Agreement.

2. When imposing safeguard measures, the Parties shall endeavour to impose them in a way that least affects their bilateral trade.

3. For the purposes of paragraph 2, if a Party considers that the legal requirements are met for the imposition of definitive safeguard measures, and it intends to apply such measures, it shall notify the other Party and give that Party the possibility of holding bilateral consultations. If no satisfactory solution has been reached within 30 days of the notification, the importing Party may adopt the definitive safeguard measures. The possibility of consultations should also be offered to the other Party in order to exchange views on the information referred to in paragraph 1.

ARTICLE 3.8

Exclusion from Bilateral Dispute Settlement and Mediation Mechanism

The provisions of this Section shall not be subject to Chapter Fourteen (Dispute Settlement) and Chapter Fifteen (Mediation Mechanism).







SECTION C

BILATERAL SAFEGUARD CLAUSE

ARTICLE 3.9

Definitions

For the purposes of this Section:

(a) ‘serious injury’ and ‘threat of serious injury’ shall be understood in accordance with subparagraphs 1(a) and 1(b) of Article 4 of the Safeguards Agreement and to that end, subparagraphs 1(a) and 1(b) of Article 4 of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis; and

(b) ‘transition period’ means a period of ten years from the entry into force of this Agreement.

ARTICLE 3.10

Application of Bilateral Safeguard Measure

1. If, as a result of the reduction or elimination of a customs duty under this Agreement, originating goods of a Party are being imported into the territory of the other Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to cause or threaten to cause serious injury to a domestic industry producing like or directly competitive goods, the importing Party may, during the transition period only, adopt measures provided for in paragraph 2 in accordance with the conditions and procedures laid down in this Section.

2. The importing Party may take a bilateral safeguard measure which:

(a) suspends further reductions of the rate of customs duty on the good concerned provided for under Annex 2-A; or

(b) increases the rate of customs duty on the good concerned to a level which does not exceed the lesser of: (i) the MFN applied rate of customs duty on the good in effect at the time the measure is taken; or (ii) the base rate of customs duty specified in the Schedules included in Annex 2-A pursuant to paragraph 2 of Article 2.6 (Reduction or Elimination of Customs Duties on Imports).

ARTICLE 3.11

Conditions and Limitations

1. A Party shall notify the other Party in writing of the initiation of an investigation described in paragraph 2 and consult with the other Party as far in advance of applying a bilateral safeguard measure as practicable, with a view to:

(a) reviewing the information arising from the investigation and whether the conditions laid out in this Article are met;

(b) exchanging views on the measure and its appropriateness in light of the objectives of this Section to remove serious injury or threat thereof to domestic industry caused by an increase in imports as set out in paragraph 1 of Article 3.10 (Application of Bilateral Safeguard Measure); and

(c) exchanging preliminary views on compensation as set out in Article 3.13 (Compensation).

2. A Party shall only apply a bilateral safeguard measure following an investigation by its competent authorities in accordance with Articles 3, 4.2(a) and 4.2(c) of the Safeguards Agreement. To that end, Articles 3, 4.2(a) and 4.2(c) of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis.

3. The determination referred to in Article 3.10 (Application of Bilateral Safeguard Measure) shall not be made unless the investigation demonstrates on the basis of objective evidence the existence of a causal link between increased imports from the other party and serious injury or the threat thereof. In this respect, due consideration shall be given to other factors, including imports of the same product from other countries.

4. Each Party shall ensure that its competent authorities complete any such investigation within one year of the date of its initiation.

5. Neither Party shall apply a bilateral safeguard measure as set out in paragraph 1 of Article 3.10 (Application of Bilateral Safeguard Measure):

(a) except to the extent, and for such time, as may be necessary to prevent or remedy serious injury and to facilitate adjustment;

(b) for a period exceeding two years, except that that period may be extended by up to two years if the competent authorities of the importing Party determine, in conformity with the procedures specified in this Article, that the measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the industry is adjusting, provided that the total period of application of a safeguard measure, including the period of initial application and any extension thereof, shall not exceed four years; or

(c) beyond the expiration of the transition period, except with the consent of the other Party.

6. No measure shall be applied again to the import of the same good during the transition period, unless a period of time equal to half of the period during which the safeguard measure was applied previously has elapsed. In this case, paragraph 3 of Article 3.13 (Compensation) shall not apply.

7. When a Party terminates a bilateral safeguard measure, the rate of customs duty shall be the rate that, according to its Schedule included in Annex 2-A, would have been in effect but for the measure.

ARTICLE 3.12

Provisional Measures

1. In critical circumstances where delay would cause damage that would be difficult to repair, a Party may apply a bilateral safeguard measure on a provisional basis pursuant to a preliminary determination that there is clear evidence that imports of an originating good from the other Party have increased as the result of the reduction or elimination of a customs duty under this Agreement, and that such imports cause serious injury, or the threat thereof, to the domestic industry. The duration of any provisional measure shall not exceed 200 days, during which time the Party shall comply with the requirements of paragraphs 2 and 3 of Article 3.11 (Conditions and Limitations). The Party shall promptly refund any tariff increases if the investigation described in paragraph 2 of Article 3.11 (Conditions and Limitations) does not result in a finding that the requirements of Article 3.10 (Application of Bilateral Safeguard Measure) are met. The duration of any provisional measure shall be counted as part of the period prescribed by subparagraph 5(b) of Article 3.11 (Conditions and Limitations).

2. If a Party takes a provisional measure pursuant to this Article, that Party shall notify the other Party in writing prior to taking such measure, and shall initiate consultations with the other Party immediately after such measure is taken.

ARTICLE 3.13

Compensation

1. A Party applying a bilateral safeguard measure shall consult with the other Party in order to mutually agree on appropriate trade liberalising compensation in the form of concessions having substantially equivalent trade effects or in the form of concessions equivalent to the value of the additional duties expected to result from the safeguard measure. The Party applying a bilateral safeguard measure shall provide an opportunity for such consultations no later than 30 days after the application of the bilateral safeguard measure.

2. If the consultations under paragraph 1 do not result in an agreement on trade liberalising compensation within 30 days after the consultations begin, the Party whose goods are subject to the safeguard measure may suspend the application of substantially equivalent concessions to the Party applying the safeguard measure. The exporting Party shall notify the other Party in writing at least 30 days before suspending concessions under this paragraph.

3. The right of suspension referred to in paragraph 2 shall not be exercised for the first 24 months during which a bilateral safeguard measure is in effect, provided that the safeguard measure conforms to the provisions of this Agreement.







CHAPTER FOUR

TECHNICAL BARRIERS TO TRADE

ARTICLE 4.1

Objectives

The objective of this Chapter is to facilitate and increase trade in goods between the Parties, by providing a framework to prevent, identify and eliminate unnecessary barriers to trade within the scope of the TBT Agreement.

ARTICLE 4.2

Scope and Definitions

1. This Chapter applies to the preparation, adoption and application of all standards, technical regulations and conformity assessment procedures, as defined in Annex 1 of the TBT Agreement, which may affect trade in goods between the Parties, regardless of the origin of those goods.

2. Notwithstanding paragraph 1, this Chapter does not apply to:

(a) purchasing specifications prepared by governmental bodies for production or consumption requirements of such bodies; or

(b) sanitary and phytosanitary measures, as defined in Annex A of the SPS Agreement, which are covered by Chapter Five of this Agreement.

3. For the purposes of this Chapter, the definitions of Annex 1 to the TBT Agreement shall apply.

ARTICLE 4.3

Affirmation of the TBT Agreement

The Parties affirm their existing rights and obligations with respect to each other under the TBT Agreement, which is incorporated into and made part of this Agreement, mutatis mutandis.

ARTICLE 4.4

Joint Cooperation

1. The Parties shall strengthen their cooperation in the field of standards, technical regulations and conformity assessment procedures, with a view to increasing the mutual understanding of their respective systems and to facilitating access to their respective markets.

2. The Parties shall seek to identify and develop regulatory cooperation initiatives appropriate for the particular issues or sectors, which may include but are not limited to:

(a) exchanging information and experiences on the preparation and application of their technical regulations and the use of good regulatory practice;

(b) simplifying, where appropriate, technical regulations, standards, and conformity assessment procedures;

(c) avoiding unnecessary divergence in their approaches to technical regulations and conformity assessment procedures, and working towards the possibility of convergence or alignment of technical regulations with international standards;

(d) encouraging cooperation between their respective bodies, whether public or private, that are responsible for metrology, standardisation, testing, certification and accreditation;

(e) ensuring efficient interaction of regulatory authorities at national, regional and international levels, for instance, by referring enquiries from a Party to the appropriate regulatory authorities; and

(f) exchanging information on developments in relevant regional and multilateral fora related to standards, technical regulations and conformity assessment procedures.

3. Upon request, a Party shall give appropriate consideration to proposals that the other Party makes for cooperation under the terms of this Chapter.

ARTICLE 4.5

Standards

1. The Parties affirm their obligations under Article 4.1 of the TBT Agreement to ensure that their standardising bodies accept and comply with the Code of Good Practice for the Preparation, Adoption and Application of Standards in Annex 3 to the TBT Agreement.

2. With a view to harmonising standards on as wide a basis as possible, each Party shall encourage its standardising bodies, as well as the regional standardising bodies of which they or their standardising bodies are Members, to cooperate with the relevant standardisation bodies of the other Party in international standardisation activities.

3. The Parties undertake to exchange information on:

(a) their use of standards in support of technical regulations;

(b) each other's standardisation processes, and the extent of use of international standards or regional standards as a base for their national standards; and

(c) cooperation agreements implemented by either Party on standardisation, provided the information can be made available to the public.

ARTICLE 4.6

Technical Regulations

The Parties agree to make best use of good regulatory practice with regard to the preparation, adoption and application of technical regulations, as provided for in the TBT Agreement including:

(a) considering, when developing a technical regulation, inter alia, the impact of the envisaged technical regulation and the available regulatory and non-regulatory alternatives to the proposed technical regulation which may fulfil the Party's legitimate objectives;

(b) using, consistent with Article 2.4 of the TBT Agreement and to the maximum extent possible, relevant international standards as a basis for their technical regulations, except when such international standards would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued; where international standards have not been used as a basis, to explain upon request to the other Party the reasons why such standards have been considered inappropriate or ineffective for the aim pursued; and

(c) specifying, consistent with Article 2.8 of the TBT Agreement and wherever appropriate, technical regulations based on product requirements in terms of performance rather than in terms of design or descriptive characteristics.

ARTICLE 4.7

Conformity Assessment Procedures

1. The Parties recognise that a broad range of mechanisms exist to facilitate the acceptance of the results of conformity assessment procedures, including:

(a) the importing Party's reliance on a supplier's declaration of conformity;

(b) agreements on mutual acceptance of the results of conformity assessment procedures with respect to specific technical regulations conducted by bodies located in the territory of the other Party;

(c) the use of accreditation procedures to qualify conformity assessment bodies;

(d) government designation of conformity assessment bodies, including bodies located in the territory of the other Party;

(e) unilateral recognition by a Party of the results of conformity assessment procedures conducted in the territory of the other Party;

(f) voluntary arrangements between conformity assessment bodies in the respective territories of each Party; and

(g) the use of regional or international multilateral recognition agreements and arrangements of which the Parties are parties.

2. Having regard, in particular, to those considerations, the Parties shall:

(a) intensify their exchange of information regarding these and other mechanisms, with a view to facilitating the acceptance of conformity assessment results;

(b) exchange information on the criteria used to select appropriate conformity assessment procedures for specific products and, in line with Article 5.1.2 of the TBT Agreement, require that conformity assessment procedures shall not be more strict or be applied more strictly than is necessary to give the importing Party adequate confidence that products conform with the applicable technical regulations or standards, taking account of the risks non-conformity would create;

(c) exchange information on accreditation policies and consider how to make the best use of international standards for accreditation and the best use of international agreements involving the Parties' accreditation bodies, for example through the mechanisms of the International Laboratory Accreditation Co-operation and the International Accreditation Forum; and

(d) ensure that, insofar as two or more conformity assessment bodies are authorised by a Party to carry out conformity assessment procedures required for placing the product on the market, economic operators may choose among them.

3. The Parties reaffirm their obligation under Article 5.2.5 of the TBT Agreement that fees imposed for mandatory conformity assessment of imported products shall be equitable in relation to any fees chargeable for assessing the conformity of like products of national origin or originating in any other country, taking into account communication, transportation and other costs arising from differences between location of facilities of the applicant and the conformity assessment body.

4. Upon request by either Party, the Parties may decide to engage in consultations with a view to defining sectoral initiatives regarding the use of conformity assessment procedures or the facilitation of acceptance of conformity assessment results that are appropriate for the respective sectors. The Party making the request should substantiate it with relevant information on how this sectoral initiative would facilitate trade between the Parties. In these consultations, all mechanisms described in paragraph 1 may be considered. Where a Party declines such a request from the other Party, it shall, upon request, explain its reasons.

ARTICLE 4.8

Transparency

The Parties reaffirm their transparency obligations under the TBT Agreement with regard to the preparation, adoption and application of standards, technical regulations and conformity assessment procedures, and agree:

(a) where a part of the process of developing a technical regulation is open to public consultation, to take the other Party's views into account and, without discrimination, to provide reasonable opportunities for the other Party and its interested persons to make comments;

(b) when making notifications in accordance with Article 2.9 of the TBT Agreement, to allow at least 60 days following the notification for the other Party to provide comments in writing on the proposal and where practicable, to give appropriate consideration to reasonable requests for extending the comment period;

(c) to allow sufficient time between the publication of technical regulations and their entry into force for economic operators of the other Party to adapt, except where urgent problems of safety, health, environmental protection or national security arise or threaten to arise; and

(d) to make available to the other Party or its economic operators relevant information (for example through a public website, if available) on technical regulations, standards and conformity assessment procedures in force and, as appropriate and available, written guidance on compliance with its technical regulations, upon request and without undue delay.

ARTICLE 4.9

Market Surveillance

The Parties undertake to exchange information on market surveillance and enforcement activities.

ARTICLE 4.10

Marking and Labelling

1. The Parties note that, according to paragraph 1 of Annex 1 of the TBT Agreement, a technical regulation may include or deal exclusively with marking or labelling requirements, and they agree, where their technical regulations contain mandatory marking or labelling, to ensure that such regulations are not prepared with a view to, or with the effect of, creating unnecessary obstacles to international trade, and that such regulations are not more trade restrictive than necessary to fulfil a legitimate objective, as referred to under Article 2.2 of the TBT Agreement.

2. The Parties agree that where a Party requires the mandatory marking or labelling of products:

(a) that Party shall endeavour to restrict its requirements only to those which are relevant for consumers or users of the product or are relevant to indicate the product's conformity with the mandatory requirements;

(b) that Party may specify the information to be provided on the label, and may require compliance with certain regulatory requirements for the affixing of the label, but shall not require any prior approval or certification of labels and markings as a precondition for sale of the products on its market, unless this is deemed necessary in the light of the risk of the product to human, animal or plant health or life;

(c) where that Party requires the use of a unique identification number by economic operators, that Party shall ensure that such numbers are issued to the relevant economic operators without undue delay and on a non-discriminatory basis;

(d) provided it is not misleading, contradictory or confusing in relation to the information required in the importing Party of the goods, that Party shall permit the following to be used in the marking or labelling of products: (i) information in other languages in addition to the information in the language required by the importing Party of the goods; (ii) internationally-accepted nomenclatures, pictograms, symbols or graphics; and (iii) additional information to that required in the importing Party of the goods;

(e) that Party shall accept that labelling, including re-labelling and corrections to labelling, may take place, where relevant, in authorised premises (for example, in customs warehouses at the point of import) in the territory of the importing Party prior to the distribution and sale of the product, as an alternative to labelling in the place of origin, unless such labelling in the place of origin is required for reasons of public health or safety; and

(f) that Party shall endeavour, in cases where it considers that legitimate objectives under the TBT Agreement are not compromised thereby, to accept non-permanent or detachable labels, or marking or labelling in the accompanying documentation rather than physically attached to the product.

3. Without prejudice to the Parties' rights and obligations under the WTO Agreement, paragraph 2 shall apply to agricultural products, industrial products, and processed agricultural food products, including beverages and spirits.

ARTICLE 4.11

Contact Points

The functions of the contact points designated in accordance with Article 13.4 (Enquiries and Contact Points) shall include:

(a) monitoring the implementation and administration of this Chapter;

(b) promptly addressing any issue that the other Party raises related to the development, adoption, application or enforcement of standards, technical regulations or conformity assessment procedures;

(c) enhancing cooperation in the development and improvement of standards, technical regulations, and conformity assessment procedures;

(d) exchanging information on standards, technical regulations, and conformity assessment procedures;

(e) facilitating cooperation activities, as appropriate, in accordance with paragraph 2 of Article 4.4 (Joint Cooperation); and

(f) arranging the establishment of ad hoc working groups at the request of either Party, in order to explore ways to facilitate trade between the Parties.

ARTICLE 4.12

Final Provisions

1. The Parties may discuss, in the Committee on Trade in Goods established pursuant to Article 16.2 (Specialised Committees), any implementing arrangements arising from this Chapter. The Parties may adopt, by decision in that Committee, any implementing measure required to this effect.

2. The Parties have undertaken further commitments on sector-specific non-tariff measures on goods as set out in Annex 4-A and the Appendices pertaining thereto.







CHAPTER FIVE

SANITARY AND PHYTOSANITARY MEASURES

ARTICLE 5.1

Objectives

The objectives of this Chapter are:

(a) to protect human, animal or plant life or health in the respective territories of the Parties while facilitating trade between the Parties in the area of sanitary and phytosanitary measures (hereinafter referred to as ‘SPS measures’);

(b) to collaborate on the further implementation of the SPS Agreement; and

(c) to provide a means to improve communication, cooperation and resolution of issues related to the implementation of SPS measures affecting trade between the Parties.

ARTICLE 5.2

Scope

1. This Chapter applies to all SPS measures of a Party that may directly or indirectly affect trade between the Parties.

2. This Chapter shall also apply to collaboration between the Parties on animal welfare matters of mutual interest to the Parties.

3. Nothing in this Chapter shall affect the rights of the Parties under the TBT Agreement with respect to measures not within the scope of this Chapter.

ARTICLE 5.3

Definitions

For the purposes of this Chapter:

(a) the definitions contained in Annex A of the SPS Agreement shall apply; and

(b) the Parties may agree on other definitions to be used in the application of this Chapter, taking into consideration the glossaries and definitions of relevant international organisations, such as the CODEX Alimentarius Commission (hereinafter referred to as ‘Codex Alimentarius’), the World Organisation for Animal Health (hereinafter referred to as ‘OIE’) and under the International Plant Protection Convention (hereinafter referred to as ‘IPPC’).

ARTICLE 5.4

Rights and Obligations

The Parties affirm their rights and obligations under the SPS Agreement.

ARTICLE 5.5

Competent Authorities

The competent authorities of the Parties responsible for the implementation of this Chapter are set out in Annex 5-A. The Parties shall notify each other of any changes to those competent authorities.

ARTICLE 5.6

General Principles

When implementing this Chapter, the Parties:

(a) shall ensure the consistency of SPS measures with the principles established by Article 3 of the SPS Agreement;

(b) shall not use SPS measures to create unjustified barriers to trade;

(c) shall ensure that procedures established under this Chapter are undertaken and completed without undue delay, and that such procedures are not applied in a manner which would constitute an arbitrary or unjustifiable discrimination against the other Party, where identical or similar conditions exist; and

(d) shall use neither the procedures referred to in subparagraph (c), nor any requests for additional information, to delay access to their respective markets without scientific and technical justification.

ARTICLE 5.7

Import Requirements

1. The import requirements of a Party shall apply to the entire territory of the other Party.

2. The exporting Party shall ensure that products exported to the importing Party meet the sanitary and phytosanitary requirements of the importing Party.

3. The importing Party shall ensure that its import requirements are applied to products imported from the exporting Party in a proportionate and non-discriminatory manner.

4. Any fees imposed for the procedures for products imported from the exporting Party shall be equitable in relation to any fees charged for like domestic products and shall not be higher than the actual cost of the service.

5. The importing Party shall have the right to carry out import checks on products imported from the exporting Party for the purpose of implementing SPS measures.

6. The import checks carried out on products imported from the exporting Party shall be based on the sanitary and phytosanitary risk associated with such imports. They shall be carried out without undue delay and with minimum effect on trade between the Parties.

7. The importing Party shall make available to the exporting Party, upon request by the exporting Party, information about the frequency of import checks carried out on products from the exporting Party. The importing Party may change the frequency of physical checks on consignments, where appropriate, as a consequence of (i) verifications, (ii) import checks, or (iii) a mutual agreement between the Parties, including following the consultations provided for in this Chapter.

8. In the event that the import checks demonstrate that products do not comply with the relevant import requirements of the importing Party, any action taken by the importing Party should be proportionate to the sanitary and phytosanitary risk associated with the importation of the non-compliant product.

ARTICLE 5.8

Verifications

1. In order to build and maintain confidence in the effective implementation of this Chapter, the importing Party shall have the right to carry out verifications at any time, including:

(a) through verification visits to the exporting Party, to verify all or part of the inspection and certification system of the exporting Party's competent authorities, in accordance with the relevant international standards, guidelines and recommendations of the Codex Alimentarius, OIE and IPPC; and

(b) by requiring the exporting Party to provide information about its inspection and certification system and by obtaining the results of the controls carried out thereunder.

2. The importing Party shall share with the exporting Party the results and conclusions of the verifications carried out pursuant to paragraph 1. The importing Party may make those results publicly available.

3. If the importing Party decides to carry out a verification visit to the exporting Party, the importing Party shall notify the exporting Party of this verification visit at least 60 calendar days before the verification visit is to be carried out, except in emergency cases or where the Parties agree otherwise. Any modification to such a visit shall be agreed by the Parties.

4. The costs incurred in carrying out the verification of all or part of the exporting Party's competent authorities' inspection and certification systems and the costs incurred in carrying out any inspections of individual establishments shall be borne by the importing Party.

5. The importing Party shall provide information in writing of a verification to the exporting Party within 60 calendar days. The exporting Party shall have 45 calendar days to comment on such information. The exporting Party's comments shall be attached to and, where appropriate, included in the final outcome document.

6. Notwithstanding paragraph 5, where a significant risk to human, animal or plant life or health has been identified during a verification, the importing Party shall inform the exporting Party as quickly as possible, and in any case within ten calendar days following the end of the verification.

ARTICLE 5.9

Trade Facilitation

1. In cases where the importing Party requires an on-the-spot verification to authorise imports of a certain category or categories of products of animal origin from the exporting Party, the following shall apply:

(a) The verification shall evaluate the exporting Party's inspection and certification system in accordance with Article 5.8 (Verifications) and shall take into consideration, upon request, any relevant written information provided by the exporting Party.

(b) In case of a satisfactory outcome of the verification of the inspection and certification system, the importing Party shall inform the exporting Party in writing of the positive outcome of the verification. In such case, the information provided may include the fact that the importing Party has authorised, or will authorise, imports of specific category or categories of products.

(c) If the outcome of the verification of the inspection and certification systems is not satisfactory, the importing Party shall inform, in writing, the exporting Party of the result of the verification. In such case, the information shall include one of the following: (i) a statement of the conditions, including those related to the inspection and certification system of the exporting Party, that still need to be put in place by the exporting Party to allow the importing Party to authorise imports of a specific category or categories of products of animal origin; (ii) a reference to the fact that specific establishments of products of animal origin may be allowed to export to the importing Party upon compliance with the relevant import requirements of Article 5.7 (Import Requirements); or (iii) a statement that the importing Party has not authorised the importation of the specific category or categories of products from the exporting Party.

2. In cases where the importing Party has authorised the importation of a specific category or categories of products of animal origin referred to in paragraph 1(b), the exporting Party shall inform the importing Party of the list of individual establishments that meet the importing Party's requirements in accordance with, in particular, Article 5.7 (Import Requirements) and Article 5.8 (Verifications). Furthermore the following applies:

(a) At the request of the exporting Party, the importing Party shall approve individual establishments as referred to in paragraph 3 of Annex 5-B which are situated in the territory of the exporting Party, without prior inspection of those individual establishments. When requesting the approval by the importing Party, the exporting Party shall provide any information required by the importing Party to guarantee the compliance with the relevant requirements, including those of Article 5.7 (Import Requirements). The approval by the importing Party shall be consistent with the conditions set out in Annex 5-B, and shall be limited to those categories of products for which imports are authorised.

(b) Upon the approval of the individual establishments referred to in subparagraph 2(a), the importing Party shall take the necessary legislative or administrative measures, in accordance with its applicable legal and administrative procedures, to allow imports within 40 calendar days of the receipt of the request of the exporting Party and, if applicable, the information required by the importing Party to guarantee the compliance with the relevant requirements, including those of Article 5.7 (Import Requirements).

(c) The importing Party shall notify the exporting Party of its acceptance or rejection of any individual establishments referred to in paragraph 2(a) and, if applicable, the reasons for any rejection.

ARTICLE 5.10

Measures Linked to Animal and Plant Health

1. The Parties recognise the concepts of pest- or disease-free areas and areas of low pest or disease prevalence, in accordance with the SPS Agreement, OIE and IPPC standards, guidelines and recommendations. The SPS Committee referred to in Article 5.15 (Committee on Sanitary and Phytosanitary Measures) may define further details for the procedure for the recognition of such areas, including procedures for the recognition of such areas in cases where there has been an outbreak, taking into account any relevant SPS Agreement, OIE and IPPC standards, guidelines or recommendations.

2. When determining pest- or disease-free areas and areas of low pest or disease prevalence, the Parties shall consider factors such as geographical location, ecosystems, epidemiological surveillance, and the effectiveness of sanitary or phytosanitary controls in such areas.

3. The Parties shall establish close cooperation on the determination of pest- or disease-free areas and areas of low pest and disease prevalence, with the objective of attaining confidence in the procedures followed by the other Party for the determination of such areas. When accepting the determination of such areas made by the exporting Party, the importing Party shall, in principle, base its determination of the animal or plant health status of the exporting Party or parts thereof on the information provided by the exporting Party in accordance with the SPS Agreement, OIE and IPPC standards, guidelines and recommendations.

4. If the importing Party does not accept the determination made by the exporting Party, it shall explain the reasons and shall be ready to enter into consultations.

5. Where the exporting Party claims that areas within its territory are pest- or disease-free areas or areas of low pest or disease prevalence, it shall provide relevant evidence in order to objectively demonstrate to the importing Party that such areas are, and are likely to remain, pest- or disease-free areas or areas of low pest or disease prevalence, as the case may be. For this purpose, reasonable access shall be given, upon request, to the importing Party for inspection, testing and other relevant procedures.

6. The Parties recognise the principle of compartmentalisation of the OIE and pest-free production sites of the IPPC. The SPS Committee referred to in Article 5.15 (Committee on Sanitary and Phytosanitary Measures) will assess any OIE and IPPC recommendations that may be issued on this matter in the future and may issue recommendations accordingly.

ARTICLE 5.11

Transparency and Exchange of Information

1. The Parties shall:

(a) pursue transparency as regards SPS measures applicable to trade and, in particular, to those of Article 5.7 (Import Requirements) applied to imports from the other Party;

(b) enhance mutual understanding of each Party's SPS measures and their application;

(c) exchange information on matters related to the development and application of SPS measures, including the progress on new available scientific evidence, that affect, or may affect, trade between the Parties with a view to minimising their negative trade effects;

(d) communicate, upon the request of a Party, the import requirements that apply to the importation of specific products within 15 calendar days; and

(e) communicate, upon the request of a Party, progress on the application for the authorisation of specific products within 15 calendar days.

2. The contact points responsible for the information pursuant to paragraph 1 are those that are designated by the Parties in accordance with paragraph 1 of Article 13.4 (Enquiries and Contact Points). Information shall be sent by post, fax or e-mail. Information by e-mail may be signed electronically and shall only be sent between the contact points.

3. Where the information pursuant to subparagraph 1(c) has been made available by notification to the WTO in accordance with its relevant rules and procedures, or where the above information has been made available on the official, publicly accessible and fee-free websites of the Parties, the information exchange referred to in that subparagraph shall be deemed to have taken place.

4. All notifications under this Chapter shall be made to the contact points referred to under paragraph 2.

ARTICLE 5.12

Consultations

1. Each Party shall notify the other Party in writing, within two calendar days, of any serious or significant risk to human, animal or plant life or health, including any food emergencies.

2. Where a Party has serious concerns regarding a risk to human, animal or plant life or health, affecting commodities for which trade takes place, consultations regarding the situation shall, upon request, take place as soon as possible. In such case, each Party shall endeavour to provide all necessary information in due time to avoid disruption in trade.

3. Consultations referred to in paragraph 2 of this Article may be held by e-mail, video or telephone conference. The requesting Party shall ensure the preparation of the minutes of the consultation.

ARTICLE 5.13

Emergency Measures

1. In case of serious risk to human, animal or plant life or health, the importing Party may, without previous notification, take measures necessary to protect human, animal or plant life or health. For consignments in transport between the Parties, the importing Party shall consider the most suitable and proportionate solution in order to avoid unnecessary disruptions to trade.

2. The Party taking the measures shall inform the other Party as soon as possible, and in any case no later than 24 hours after the adoption of the measure. Either Party may request any information related to the sanitary and phytosanitary situation or to any such measures that have been adopted. The other Party shall reply as soon as the requested information is available.

3. Upon the request of either Party, and in accordance with the provisions of Article 5.12 (Consultations), the Parties shall hold consultations regarding the situation within 15 calendar days of the notification. These consultations shall be carried out in order to avoid unnecessary disruptions to trade. The Parties may consider options for the facilitation of the implementation or the replacement of the measures.

ARTICLE 5.14

Equivalence

1. The Parties may recognise the equivalence of an individual measure, groups of measures or systems applicable to a sector or to a part of a sector in accordance with paragraphs 4 to 7. The recognition of equivalence shall be applied to trade between the Parties in animals and animal products, plants and plant products, or, as appropriate, to related goods.

2. Where equivalence has not been recognised, trade shall take place under the conditions required by the importing Party to meet its appropriate level of protection.

3. The recognition of equivalence requires an assessment and acceptance of:

(a) existing SPS measures in legislation, standards and procedures, including controls related to inspection and certification systems to ensure that the SPS measures of both the exporting Party and the importing Party are met;

(b) the documented structure of the competent authorities, their powers, their chain of command, their modus operandi and the resources available to them; and

(c) the performance of the competent authority in relation to the control programmes and assurances.

4. In their assessments, the Parties shall take account of experience already acquired.

5. The importing Party shall accept a sanitary or phytosanitary measure of the exporting Party as equivalent if the exporting Party objectively demonstrates that its measure achieves the importing Party's appropriate level of protection. For this purpose, reasonable access shall be given, upon request, to the importing Party for inspection, testing and other relevant procedures.

6. The Parties will take into account guidance of the Codex Alimentarius, OIE, IPPC and the WTO SPS Committee in recognising equivalence.

7. Furthermore, where equivalence has been recognised, the Parties may agree on a simplified model for the official sanitary or phytosanitary certificates that are necessary for each consignment of animals or animal products, plants or plant products, or other related goods intended for importation.

ARTICLE 5.15

Committee on Sanitary and Phytosanitary Measures

1. The Committee on Sanitary and Phytosanitary Measures (hereinafter referred to as the ‘SPS Committee’) established pursuant to Article 16.2 (Specialised Committees) shall include representatives of the competent authorities of the Parties.

2. The SPS Committee shall meet within one year of the entry into force of this Agreement. Thereafter it shall meet at least once a year or as agreed by the Parties. The SPS Committee shall establish its rules of procedure at its first meeting. It shall meet in person, by telephone conference, by video-conference, or through any other means, as agreed by the Parties.

3. The SPS Committee may agree to establish technical working groups consisting of experts of the Parties, which shall identify and address technical and scientific issues arising under this Chapter and shall explore opportunities for further collaboration on SPS matters of mutual interest. When additional expertise is needed, persons other than representatives of the Parties may participate in the work of a technical working group.

4. The SPS Committee may address any matter related to the effective functioning of this Chapter. In particular, it shall have the following responsibilities and functions:

(a) developing the necessary procedures or arrangements for the implementation of this Chapter, including Annexes 5-A and 5-B;

(b) monitoring the implementation of this Chapter; and

(c) providing a forum for discussion of problems arising from the application of certain SPS measures with a view to reaching mutually acceptable solutions. In this connection, the SPS Committee shall be convened as a matter of urgency, at the request of a Party, so as to carry out consultations. Such consultations are without prejudice to the rights and obligations of the Parties under Chapter Fourteen (Dispute Settlement) and Chapter Fifteen (Mediation Mechanism).

5. The SPS Committee shall exchange information, expertise and experiences in the field of animal welfare in order to promote the collaboration on animal welfare between the Parties.

6. The Parties may, by decision in the SPS Committee, adopt recommendations and decisions related to the authorisation of imports, exchange of information, transparency, recognition of regionalisation, equivalency and alternative measures, and any other matter referred to under paragraphs 4 and 5.

ARTICLE 5.16

Technical Consultations

1. Where a Party considers that a measure of the other Party is or might be contrary to the obligations under this Chapter, and considers that the measure causes or may cause an unjustified disruption to trade, it may request technical consultations in the SPS Committee with a view to reaching mutually acceptable solutions. The competent authorities set out in Annex 5-A shall facilitate these consultations.

2. Technical consultations in the SPS Committee shall be deemed concluded within 30 days following the date of submission of the request for technical consultations, unless the consulting Parties agree to continue with the consultations. The technical consultations may be made via telephone conference, video-conference, or any other mechanism agreed by the Parties.







CHAPTER SIX

CUSTOMS AND TRADE FACILITATION

ARTICLE 6.1

Objectives

1. The Parties recognise the importance of customs and trade facilitation matters in the evolving global trading environment. The Parties agree to reinforce cooperation in this area, with a view to ensuring that the relevant legislation and procedures, as well as the administrative capacity of the relevant administrations, fulfil the objectives of promoting trade facilitation while ensuring effective customs control.

2. To that end, the Parties agree that legislation shall be non-discriminatory, and that customs procedures shall be based upon the use of modern methods and effective controls to combat fraud and to protect legitimate trade.

3. The Parties recognise that legitimate public policy objectives, including in relation to security, safety and combating fraud, shall not be compromised in any way.

ARTICLE 6.2

Principles

1. The Parties agree that their respective customs provisions and procedures shall be based upon:

(a) international instruments and standards applicable in the area of customs and trade which the respective Parties have accepted, including the substantive elements of the Revised Kyoto Convention on the Simplification and Harmonisation of Customs Procedures, the International Convention on the Harmonized Commodity Description and Coding System, and the Framework of Standards to Secure and Facilitate Global Trade (hereinafter referred to as ‘SAFE Framework’) of the World Customs Organization (hereinafter referred to as ‘WCO’);

(b) the protection of legitimate trade through the effective enforcement and compliance of legislative requirements;

(c) legislation that avoids unnecessary or discriminatory burdens on economic operators, that provides for further trade facilitation for economic operators with high levels of compliance, and that ensures safeguards against fraud and illicit or damageable activities; and

(d) rules that ensure that any penalty imposed for breaches of customs regulations or procedural requirements is proportionate and non-discriminatory, and that their application shall not unduly delay the release of goods.

2. In order to improve working methods, as well as to ensure non-discrimination, transparency, efficiency, integrity and accountability of operations, the Parties shall:

(a) simplify requirements and formalities wherever possible with respect to the rapid release and clearance of goods; and

(b) work towards the further simplification and standardisation of the data and documentation required by customs and other agencies.

ARTICLE 6.3

Customs Cooperation

1. The Parties shall cooperate on customs matters between their respective authorities in order to ensure that the objectives set out in Article 6.1 (Objectives) are attained.

2. In order to enhance cooperation on customs matters, the Parties shall, inter alia:

(a) exchange information concerning their respective customs legislation, the implementation thereof, and their customs procedures, particularly in relation to the following areas: (i) simplification and modernisation of customs procedures; (ii) border enforcement of intellectual property rights by the customs authorities; (iii) transit movements and transhipment; and (iv) relations with the business community;

(b) consider developing joint initiatives relating to import, export and other customs procedures, as well as towards ensuring an effective service to the business community;

(c) work together on customs-related aspects of securing and facilitating the international trade supply chain in accordance with the SAFE Framework;

(d) establish, where appropriate, mutual recognition of their respective risk management techniques, risk standards, security controls and trade partnership programmes, including aspects such as data transmission and mutually agreed benefits; and

(e) strengthen coordination in international organisations such as the WTO and the WCO.

ARTICLE 6.4

Transit and Transhipment

1. Each Party shall ensure the facilitation and effective control of transhipment operations and transit movements through its territory.

2. The Parties shall promote and implement regional transit arrangements with a view to facilitating trade.

3. The Parties shall ensure cooperation and coordination between all concerned authorities and agencies in their respective territories to facilitate traffic in transit.

ARTICLE 6.5

Advance Rulings

Prior to the importation of goods into its territory, and in accordance with its legislation and procedures, each Party shall issue to traders established in its territory, through its customs authorities or other competent authorities, written advance rulings concerning tariff classification, origin, and any other matters as the Party may decide.

ARTICLE 6.6

Simplified Customs Procedure

1. Each Party shall provide simplified import and export procedures that are transparent and efficient, in order to reduce costs and increase predictability for economic operators, including small and medium sized enterprises. Easier access to customs simplifications shall also be provided for authorised traders, according to objective and non-discriminatory criteria.

2. A single customs declaration document or its electronic equivalent shall be used for the purpose of completing the formalities required for placing the goods under a customs procedure.

3. The Parties shall apply modern customs techniques, including risk assessment and post-clearance audit methods, in order to simplify and facilitate the entry and the release of goods.

4. The Parties shall promote the progressive development and use of systems, including those based upon information technology, to facilitate the electronic exchange of data among their respective traders, customs authorities and other related agencies.

ARTICLE 6.7

Release of Goods

Each Party shall ensure that its customs authorities, border agencies or other competent authorities shall apply requirements and procedures that:

(a) provide for the prompt release of goods within a period no greater than that required to ensure compliance with its customs and other trade-related laws and formalities;

(b) provide for pre-arrival processing (i.e. advance electronic submission and eventual processing of information before physical arrival of goods) to enable the release of goods on arrival; and

(c) provide for the release of goods without the payment of customs duties, subject to the provision of a guarantee, if required according to the legislation of the Party concerned, in order to secure the final payment of customs duties.

ARTICLE 6.8

Fees and Charges

1. Fees and charges shall only be imposed for services provided in connection with the importation or exportation in question and for any formality required for undertaking such importation or exportation. They shall not exceed the approximate cost of the service provided, and shall not be calculated on an ad valorem basis.

2. The information on fees and charges shall be published via an officially designated medium, which may include the internet. This information shall include the reason for the fee or charge for the service provided, the responsible authority, the fee or charge that will be applied, and when and how payment is to be made.

3. New or amended fees and charges shall not be imposed until information in accordance with paragraph 2 is published and made readily available.

ARTICLE 6.9

Customs Brokers

The Parties agree that their respective customs provisions and procedures shall not require the mandatory use of customs brokers. The Parties shall apply transparent, non-discriminatory and proportionate rules when licensing customs brokers.

ARTICLE 6.10

Preshipment Inspections

The Parties agree that their respective customs provisions and procedures shall not require the mandatory use of preshipment inspections as defined in the Agreement on Preshipment Inspection, or any other inspection activity performed by private companies at the destination, before customs clearance.

ARTICLE 6.11

Customs Valuations

1. The Parties shall determine the customs value of goods in accordance with the Customs Valuation Agreement.

2. The Parties shall cooperate with a view to reaching a common approach to issues relating to customs valuation.

ARTICLE 6.12

Risk Management

1. Each Party shall base its examination and release procedures and its post-entry verification procedures on risk assessment principles and the use of audits, rather than examining each shipment in a comprehensive manner for compliance with all import requirements.

2. The Parties agree to adopt and apply their control requirements and procedures for the importation, exportation, transit and transhipment of goods on the basis of risk management principles which shall be applied to focus compliance measures on transactions that merit attention.

ARTICLE 6.13

Single Window

Each Party shall endeavour to develop or maintain single window systems to facilitate a single, electronic submission of all information required by customs and other legislation for the exportation, importation and transit of goods.

ARTICLE 6.14

Appeal Procedures

1. Each Party shall provide effective, prompt, non-discriminatory and easily accessible procedures to guarantee the right of appeal against the administrative actions, rulings and decisions by customs and other competent authorities that affect the importation or exportation of goods or that affect goods in transit.

2. Appeal procedures may include administrative review by the supervising authority and the judicial review of decisions taken at the administrative level in accordance with the legislation of the Parties.

ARTICLE 6.15

Transparency

1. Each Party shall publish or otherwise make available, including through electronic means, their legislation, regulations, and administrative procedures and other requirements relating to customs and trade facilitation.

2. Each Party shall designate or maintain one or more inquiry or information points to address inquiries by interested persons concerning customs and trade facilitation matters.

ARTICLE 6.16

Relations with the Business Community

The Parties agree:

(a) on the importance of timely consultations with trade representatives when formulating legislative proposals and general procedures related to customs and trade facilitation issues; to that end, consultations shall be held between customs authorities and the business community, as appropriate;

(b) to publish or otherwise make available, as far as possible through electronic means, new legislation and general procedures related to customs and trade facilitation issues prior to the application of any such legislation and procedures, as well as changes to and interpretations of such legislation and procedures; they shall also make publicly available relevant notices of an administrative nature, including agency requirements and entry procedures, hours of operation and operating procedures for customs offices at ports and border crossing points, and points of contact for information enquiries;

(c) on the need for a reasonable time period between the publication of new or amended legislation, procedures and fees or charges and their entry into force, without prejudice to legitimate public policy objectives (e.g. changes in duty rates); and

(d) to ensure that their respective customs and related requirements and procedures continue to meet the needs of the trading community, follow best practices, and that they remain the least trade-restrictive requirements and procedures possible.

ARTICLE 6.17

Committee on Customs

1. The Committee on Customs established by Article 16.2 (Specialised Committees) shall consist of representatives of the customs and other competent authorities of the Parties. The Committee on Customs shall ensure the proper functioning of this Chapter, Protocol 1 and any additional provisions relating to customs that the Parties may agree on. The Parties may examine and take decisions in the Committee on Customs on all issues arising thereunder.

2. The Parties may adopt recommendations and take decisions in the Committee on Customs on the mutual recognition of risk management techniques, risk standards, security controls and trade partnership programmes, including aspects such as data transmission and mutually agreed benefits, and any other issue covered by paragraph 1.

3. The Parties may agree to hold ad hoc meetings for any customs matter, including rules of origin, and any additional customs-related provisions as agreed between the Parties. They may also establish sub-groups for specific issues, where appropriate.







CHAPTER SEVEN

NON-TARIFF BARRIERS TO TRADE AND INVESTMENT IN RENEWABLE ENERGY GENERATION

ARTICLE 7.1

Objectives

In line with global efforts to reduce greenhouse gas emissions, the Parties share the objective of promoting, developing and increasing the generation of energy from renewable and sustainable non-fossil sources, particularly through facilitating trade and investment. To this effect, the Parties shall cooperate towards removing or reducing tariffs as well as non-tariff barriers, and shall cooperate on fostering regulatory convergence with or towards regional and international standards.

ARTICLE 7.2

Definitions

For the purposes of this Chapter:

(a) ‘local content requirement’ means (i) with respect to goods, a requirement for an enterprise to purchase or use goods of domestic origin or goods from a domestic source, whether that requirement is specified in terms of particular products, in terms of volume or value of products, or in terms of a proportion of volume or value of its local production; (ii) with respect to services, a requirement which restricts the choice of the service supplier or the service supplied, to the detriment of services or service suppliers from the other Party;

(b) ‘measure’ means any measure within the scope of this Chapter that is taken by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;

(c) ‘measures requiring the formation of partnerships with local companies’ means any requirements to jointly establish or operate with local companies or other businesses any legal entity such as a corporation, trust, partnership, joint venture or to enter into other contractual relations;

(d) ‘offset’ means any condition that encourages local development, such as the unjustified licensing of technology, investment, obligation to contract with a particular financial institution, counter-trade, and similar requirements; and

(e) ‘service supplier’ means as defined in paragraph (l) of Article 8.2 (Definitions).

ARTICLE 7.3

Scope

1. This Chapter applies to measures which may affect trade and investment between the Parties related to the generation of energy from renewable and sustainable non-fossil sources, namely wind, solar, aerothermal, geothermal, hydrothermal and ocean energy, hydropower, biomass, landfill gas, sewage treatment plant gas and biogases, but not to the products from which energy is generated.

2. This Chapter does not apply to research and development projects and to demonstration projects carried out on a non-commercial scale.

3. This Chapter is without prejudice to the application of any other relevant provisions of this Agreement, including any exceptions, reservations or restrictions to those provisions, to the measures mentioned in paragraph 1, mutatis mutandis. For greater certainty, in the event of any inconsistency between this Chapter and any other provisions of this Agreement, the other provisions of this Agreement shall prevail to the extent of the inconsistency.

ARTICLE 7.4

Principles

Each Party shall:

(a) refrain from adopting measures providing for local content requirements or any other offset affecting the other Party's products, service suppliers, entrepreneurs or establishments;

(b) refrain from adopting measures requiring the formation of partnerships with local companies, unless such partnerships are deemed necessary for technical reasons and the Party can demonstrate such technical reasons upon request by the other Party;

(c) ensure that any rules concerning the authorisation, certification and licensing procedures that are applied, in particular to equipment, plants and associated transmission network infrastructures, are objective, transparent, and non-arbitrary, and do not discriminate against applicants from the other Party;

(d) ensure that administrative charges imposed on or in connection with the: (i) importation and use of goods originating in the other Party, or affecting the provision of goods by the other Party's suppliers, are subject to Article 2.10 (Fees and Formalities Connected with Importation and Exportation); and (ii) provision of services by the other Party's suppliers are subject to Article 8.18 (Scope and Definitions), Article 8.19 (Conditions for Licensing and Qualification) and Article 8.20 (Licensing and Qualification Procedures); and

(e) ensure that the terms, conditions and procedures for the connection and access to electricity transmission grids are transparent and do not discriminate against suppliers of the other Party.

ARTICLE 7.5

Standards, Technical Regulations and Conformity Assessment

1. Where international or regional standards exist with respect to products for the generation of energy from renewable and sustainable non-fossil sources, the Parties shall use those standards, or the relevant parts of those standards, as a basis for their technical regulations except when such international standards or relevant parts would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued. For the purpose of applying this paragraph, the International Organization for Standardization (hereinafter referred to as ‘ISO’) and the International Electrotechnical Commission (hereinafter referred to as ‘IEC’), in particular, shall be considered relevant international standard-setting bodies.

2. Where appropriate, the Parties shall specify technical regulations based on product requirements in terms of performance, including environmental performance, rather than in terms of design or descriptive characteristics.

3. With respect to products listed in Chapter 84 of the Harmonized System (except 8401) as well as in HS 850231 and 854140:

(a) the Union will accept declarations of conformity from Singapore suppliers under the same terms as from Union suppliers and without any further requirements, for the purpose of placing such products on the market; and

(b) Singapore will accept EU declarations of conformity or test reports without any further requirements, for the purpose of placing such products on the market. Singapore may require mandatory third party testing or certification under the conditions set out in Article 5 (Safeguard Measures) of Annex 4-A.

For greater certainty, this paragraph is without prejudice to either Party applying requirements not related to the products referred to in this paragraph, such as zoning laws or building codes.

ARTICLE 7.6

Exceptions

1. This Chapter is subject to the exceptions provided for in Article 2.14 (General Exceptions), Article 8.62 (General Exceptions), Article 9.3 (Security and General Exceptions) and, for greater certainty, to the relevant provisions of Chapter Sixteen (Institutional, General and Final Provisions).

2. For greater certainty, subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between the Parties' products, service suppliers or investors where the same conditions prevail, or a disguised restriction on trade and investment between the Parties, nothing in this Chapter shall be construed as preventing a Party from the adoption or enforcement of measures necessary for the safe operation of the energy networks concerned, or the safety of energy supply.

ARTICLE 7.7

Implementation and Cooperation

1. The Parties shall cooperate and exchange information on any issues relevant for the implementation of this Chapter in the Trade Committee established pursuant to Article 16.1 (Trade Committee). The Parties may, by decision of the Trade Committee, adopt appropriate implementing measures to this effect and update this Chapter as appropriate.

2. The cooperation may include:

(a) exchanging information, regulatory experiences and best practices in areas such as: (i) the design and non-discriminatory implementation of measures promoting the uptake of energy from renewable sources; (ii) carbon capture and storage; (iii) smart grids; (iv) energy efficiency; and (v) technical regulations, standards and conformity assessment procedures, such as those relating to grid code requirements; and

(b) promoting, also in relevant regional fora, the convergence of their domestic or regional technical regulations, regulatory concepts, standards, requirements and conformity assessment procedures with international standards.







CHAPTER EIGHT

SERVICES, ESTABLISHMENT AND ELECTRONIC COMMERCE







SECTION A

GENERAL PROVISIONS

ARTICLE 8.1

Objective and Scope

1. The Parties, affirming their respective commitments under the WTO Agreement, hereby lay down the necessary arrangements for the progressive reciprocal liberalisation of trade in services, establishment and electric commerce.

2. Except as otherwise provided, this Chapter shall not:

(a) apply to subsidies granted or grants provided by a Party, including government-supported loans, guarantees, and insurance;

(b) apply to services supplied in the exercise of governmental authority within the respective territories of the Parties;

(c) require the privatisation of public undertakings; and

(d) apply to laws, regulations or requirements governing the procurement by governmental agencies of services purchased for governmental purposes and not with a view to commercial resale or with a view to use in the supply of services for commercial sale.

3. Each Party retains the right to regulate and to introduce new regulations to meet legitimate policy objectives in a manner consistent with this Chapter.

4. This Chapter does not apply to measures that affect natural persons seeking access to the employment market of a Party, or to measures regarding citizenship, residence or employment on a permanent basis. Nothing in this Chapter shall prevent a Party from applying measures to regulate the entry of natural persons of the other Party into, or their temporary stay in, its territory, including measures that are necessary to protect the integrity of, and to ensure the orderly movement of natural persons across its borders, provided that such measures are not applied in such a manner as to nullify or impair the benefits ( 4 ) accruing to the other Party under the terms of this Chapter.

ARTICLE 8.2

Definitions

For the purposes of this Chapter:

(a) ‘direct taxes’ comprises all taxes on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation;

(b) ‘juridical person’ means any legal entity duly constituted or otherwise organised under applicable law, whether for profit or otherwise, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, joint venture, sole proprietorship, or association;

(c) ‘Union juridical person’ or ‘Singapore juridical person’ means: (i) a juridical person set up in accordance with the laws of the Union and/or the Member States of the Union, or Singapore, respectively, and having its registered office, central administration ( 5 ), or principal place of business in the territory of the Union or Singapore, respectively; or (ii) in the case of establishment in accordance with paragraph (d) of Article 8.8 (Definitions), a juridical person owned or controlled by natural persons of the Member States of the Union or of Singapore respectively, or by Union juridical persons or Singapore juridical persons respectively; should the juridical person have only its registered office or central administration in the territory of the Union or of Singapore, respectively, it shall not be considered as a Union or Singapore juridical person, respectively, unless it engages in substantive business operations ( 6 ) in the territory of the Union or of Singapore respectively; a juridical person is: (i) ‘owned’ by natural or juridical persons of the Union and/or any Member State of the Union, or of Singapore, if more than 50 per cent of the equity interest in it is beneficially owned by persons of the Union and/or any Member State of the Union, or of Singapore, respectively; (ii) ‘controlled’ by natural or juridical persons of the Union and/or any Member State of the Union, or of Singapore, if such persons have the power to name a majority of its directors or otherwise to legally direct its actions; (iii) ‘affiliated’ with another person when it controls, or is controlled by, that other person; or when it and the other person are both controlled by the same person;

(d) notwithstanding subparagraph (c), shipping companies established outside the Union and controlled by nationals of a Member State of the Union shall also be covered by this Agreement if their vessels are registered in accordance with the respective legislation of a Member State of the Union and fly the flag of that Member State of the Union;

(e) ‘measure’ means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;

(f) ‘measures adopted or maintained by a Party’ means measures taken by: (i) central, regional or local governments and authorities; or (ii) non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities;

(g) ‘measures adopted or maintained by a Party affecting trade in services’ include measures in respect of: (i) the purchase, payment or use of a service; (ii) the access to and use of, in connection with the supply of a service, services which are required by a Party to be offered to the public generally; and (iii) the presence, including commercial presence, of persons of a Party for the supply of a service in the territory of the other Party;

(h) ‘Schedule of Specific Commitments’ refers to, in the case of the Union, Annex 8-A and the Appendices thereto, and, in the case of Singapore, Annex 8-B and the Appendices thereto;

(i) ‘service consumer’ means any person that receives or uses a service;

(j) ‘supply of a service’ includes the production, distribution, marketing, sale and delivery of a service;

(k) ‘service of the other Party’ means a service which is supplied: (i) from or in the territory of the other Party, or in the case of maritime transport, by a vessel registered under the laws of the other Party, or by a person of the other Party which supplies the service through the operation of a vessel and/or its use in whole or in part; or (ii) in the case of the supply of a service through commercial presence or through the presence of natural persons, by a service supplier of the other Party;

(l) ‘service supplier’ means any person that supplies or seeks to supply a service, including through establishment;

(m) service supplied in the exercise of governmental authority means any service, except a service which is supplied on a commercial basis or in competition with one or more service suppliers; and

(n) ‘trade in services’ means the supply of a service: (i) from the territory of a Party into the territory of the other Party (cross-border); (ii) in the territory of a Party to a service consumer of the other Party (consumption abroad); (iii) by a service supplier of a Party, through commercial presence, in the territory of the other Party (commercial presence); or (iv) by a service supplier of a Party, through presence of natural persons of that Party, in the territory of the other Party (presence of natural persons).







SECTION B

CROSS-BORDER SUPPLY OF SERVICES

ARTICLE 8.3

Scope

This Section applies to measures of the Parties affecting the cross-border supply of all service sectors except:

(a) audio-visual services;

(b) national maritime cabotage ( 7 ); and

(c) domestic and international air transport services, whether scheduled or non-scheduled, and services directly related to the exercise of traffic rights, other than: (i) aircraft repair and maintenance services during which an aircraft is withdrawn from service; (ii) the selling and marketing of air transport services; and (iii) computer reservation system services.

ARTICLE 8.4

Definitions

For the purposes of this Section, ‘cross-border supply of services’ means the supply of a service:

(a) from the territory of a Party into the territory of the other Party; and

(b) in the territory of a Party to a service consumer of the other Party.

ARTICLE 8.5

Market Access

1. With respect to market access through the cross-border supply of services, each Party shall accord services and service suppliers of the other Party treatment no less favourable than that provided for under the terms, limitations and conditions agreed and specified in its Schedule of Specific Commitments.

2. In sectors where market access commitments are undertaken, the measures which each Party shall not adopt or maintain either on the basis of a regional subdivision or on the basis of its entire territory, unless otherwise specified in its Schedule of Specific Commitments, are defined as:

(a) limitations on the number of service suppliers, whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirement of an economic needs test ( 8 );

(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test; and

(c) limitations on the total number of service operations or on the total quantity of service output expressed in the terms of designated numerical units in the form of quotas or the requirement of an economic needs test ( 9 ).

ARTICLE 8.6

National Treatment

1. In the sectors inscribed in its Schedule of Specific Commitments and subject to any conditions and qualifications set out therein, each Party shall accord to services and service suppliers of the ot