Article 5-06. Risk Assessment and Appropriate Level of Sanitary and Phytosanitary Protection
1. The Parties shall ensure that their sanitary and phytosanitary measures are based on an appropriate evaluation to the circumstances of the risks for life, human and animal health, as well as for the preservation of health in plants, taking into account the risk assessment techniques developed by the relevant standardization organizations agreed by the parties.
2. In conducting a risk assessment on a good, including risks, food additives and contaminants, the Parties shall take into account the following factors:
a) The available scientific and technical information;
b) The existence of pests and diseases to be taken into account, including the existence of free or areas of low pest and disease prevalence recognized by the parties;
c) The epidemiology of the diseases and pest risk;
d) The critical control points in production processes, handling, packaging, packaging and transport;
e) The ecological and other environmental conditions to be considered;
f) The relevant methods of sampling and testing; and
g) The applicable quarantine measures and treatments that meet the importing country
As regards risk mitigation.
3. In addition to paragraph 2, in establishing the appropriate level of sanitary and phytosanitary protection, Parties shall take into account the risk associated with the introduction, establishment and spread of a pest or disease; and in assessing risk shall also take into account, where relevant, the following economic factors:
a) The loss of production or sales in the event of entry, or dissemination of a disease or pest;
b) Costs of control or eradication of the disease or pest in its territory; and
c) The cost-effectiveness of alternative approaches to limit the risk.
4. Without prejudice to paragraphs 2 and 3 and subparagraph (c) of paragraph 2 of article 5-03, when a party to conduct an assessment of risk, and concludes that the scientific evidence or other information is insufficient to complete the evaluation, may adopt a sanitary or phytosanitary measure on a provisional basis, provided that the based on relevant information available. once that party receives information sufficient to complete the assessment of risk, the Parties shall agree on a deadline for the completion of the same and, where appropriate, revise the provisional sanitary or phytosanitary measure.
Article 5-07. Adaptation to Regional Conditions and Recognition of Pest or Disease Free Areas and Areas of Low Pest or Disease Prevalence
1. Each Party shall adapt its sanitary or phytosanitary measures connected with the introduction or spread of a disease or pest, to the sanitary or phytosanitary characteristics of the area where a good subject to such measure is produced and the area in its territory to which the good is intended, taking into account any relevant status, including those relating to transportation between these areas. in assessing sanitary or phytosanitary characteristics of an area, the Parties shall take into account, inter alia, the prevalence of pests or diseases; the existence of specific eradication or control programs, and the criteria and guidelines developed by relevant organizations and agreed by the parties.
2. The Parties shall accord in particular the concepts of disease-free areas and areas of low or pest disease prevalence. the determination of such areas shall be based on factors such as geographical situation, ecosystems, epidemiological surveillance and the effectiveness of sanitary or phytosanitary controls.
3. The parties declare a zone free from a given disease or pest in its territory, it shall demonstrate scientific information to the other party and that grant such status shall be regarded as such, based on the protection measures adopted by the authorities responsible for sanitary and phytosanitary services.
4. The party interested in obtaining recognition of a zone free of pests or diseases and making the request shall provide the relevant scientific and technical information to the other party.
5. The party receiving the request for recognition referred to in paragraph 4 shall act in a period agreed by the parties, which may carry out verifications in the territory of the exporting Party for inspection, testing and other relevant procedures. in case of non-acceptance, bring written technical and scientific substantiation of its decision.
6. The Parties shall establish agreements on specific requirements which allows a good produced in an area of low disease or pest prevalence be imported if the appropriate level of sanitary or phytosanitary protection.
Article 5-08. Control Procedures, Inspection and Approval
1. Each Party shall initiate and complete any control or inspection procedure as expeditiously as possible and shall notify WHO so requires, the expected duration of the procedure.
2. Each Party shall ensure that its competent authority:
a) Upon receipt of a request, consider promptly make the documentation is complete and informs the applicant in a precise and complete, on any deficiency;
b) As soon as practicable the applicant to transmit the results of the procedure in a complete and precise so that it may take any necessary corrective action;
c) This application where the deficiencies, follow the procedure as far as practicable, if the applicant so requests, in accordance with the deadlines and report, at the request of the applicant, on the status of the application and the reasons for any delay;
d) What is necessary to limit the information the applicant is due, for conducting the procedure;
e) Accord or reserved for confidential information relating to the conduct of the proceedings for a good of the other party;
f) To protect the legitimate commercial interests of the applicant in accordance with the legislation in force in each party;
g) What is necessary to limit any requirement regarding individual samples or specimens of a good;
h) For conducting the procedure is not a law on a good of the other party, in excess of the recovery of their property;
i) Select adequately the location of facilities at which shall carry out the procedure as well as samples of goods that do not cause unnecessary inconvenience to an applicant or his representative;
j) A mechanism to review complaints concerning the operation of the procedure and to take corrective action when a complaint is justified; and
k) When amending the specifications of a good after their control and inspection, under the rules governing the procedure prescribed for the good modified shall be limited to that necessary to determine whether there is assurance that due the good remains under the regulations concerned.
3. Each Party shall apply to its approval procedures of the relevant provisions of paragraph 2.
4. If the importing party is required to carry out a control or inspection procedure at the stage of production, the exporting Party shall, at the request of the importing Party, reasonable measures available to facilitate access to it in its territory and shall provide the necessary assistance to the importing Party for the performance of control or inspection procedure.
5. To ensure food safety, each party may establish in its approval procedures and regulations, in accordance with their authorization requirements for the use of a food additive or establishment of a tolerance for a pollutant in the same, before granting access to its market. where it requires the Party may adopt a rule, relevant international guidelines or recommendations as the basis for granting access to those goods, pending a final determination.
Article 5-09. Provision of Information, Notification and Publication
1. Each Party shall propose to the adoption or modification of a sanitary or phytosanitary measure in its territory, and provided that it may have an impact on the trade of the other party:
a) Publish a notice and notify the other party in writing at least sixty days in advance of its intention to adopt or modify this measure that is not a law, and publish and make available to the other party the full text of the proposed measure, where feasible; and identify the provisions that are not substantially of the relevant international standards, guidelines or recommendations so as to enable interested persons to become acquainted with the proposed;
b) This shall identify the goods to which such measure shall apply, and include a description of the objective and the reasons for it; and
c) A copy of the proposed measure to any applicant and without discrimination as will enable the Party and other interested persons to make comments in writing and, upon request, discuss and take into account the results of such discussions.
2. Where a Party considers it necessary to address an emerging problem relating to sanitary or phytosanitary protection, it may omit any step set out in paragraph 1, provided that, once adopted a sanitary or phytosanitary measure:
a) Immediately notify the other Party in accordance with the requirements set out in subparagraph 1 (b), including a brief description of the emergency; and
b) Re-delivered a copy of the measure to any interested party or persons upon request and without discrimination as to enable the Party and other interested persons to make comments in writing and, upon request, discuss and take into account the results of such discussions.
3. Each Party, except where necessary to address an emerging problem referred to in paragraph 2, shall determine a reasonable period between the publication of a sanitary or phytosanitary measure and the date of Entry into Force of the same with the aim of allowing time for interested persons to adapt to the measure.
4. Where an importing party denies entry into its territory to a good of the exporting Party, because it does not comply with a sanitary or phytosanitary measure notified in writing within a period of not more than seven days, an explanation, in identifying the measure concerned as well as the reasons that the good does not comply with such a measure.
5. Each Party shall designate an authority responsible for the implementation in its territory of the notification provisions of this article, within a period of no more than 30 days after the Entry into Force of this Treaty.
Article 5-10. Information Centres
1. Each Party shall ensure that there is at least an information centre within its territory able to answer questions and all reasonable requests of the Party and other interested persons and provide the relevant documentation in relation to:
a) Any proposed sanitary or phytosanitary measure adopted or maintained in its territory, including the procedures for control or inspection and approval procedures of production and quarantine, regimes and procedures relating to the maximum levels of pesticide;
b) Risk assessment processes and the factors it takes into consideration in conducting the assessment and in establishing its appropriate level of sanitary or phytosanitary protection; and
c) The membership and participation in bodies and sanitary and phytosanitary systems international and regional and bilateral and multilateral agreements within the scope of this chapter and the provisions of those systems and arrangements, agencies, and the location of notices published pursuant to this chapter, or where such information can be obtained.
2. Where a Party designates more of an Information Centre, shall notify the other Party on the scope of responsibility of each such centres.
3. Each Party shall ensure that, in accordance with the provisions of this chapter, when the other party or interested persons request copies of documents, they shall provide the same price for its domestic sales, plus cost of shipment.
Article 5-11. Limitations on the Provision of Information
Further to article 21-03, nothing in this chapter shall be construed as requiring a party to furnish any confidential information the disclosure of which would prejudice legitimate commercial interests of a company.
Article 5-12. Committee on Sanitary and Phytosanitary Measures.
1. The parties establish a Committee on Sanitary and Phytosanitary Measures, comprising representatives of each, with responsibility for sanitary and phytosanitary matters. the deadline for installation shall be no more than 90 days from the date of entry into force of this Treaty.
The Committee shall monitor the implementation of the provisions of this chapter, the expeditious achievement of its objectives and make specific recommendations on sanitary and phytosanitary issues.
2. The Committee shall:
a) Establish modalities it considers appropriate for the coordination and resolve matters referred to it;
b) To facilitate the agricultural trade between the parties; promoting the improvement of sanitary and phytosanitary conditions in the territories of the Parties;
c) Promote activities identified by the parties in accordance with article 5-04, 505, 5-06 5-07 5-15; and
d) Facilitate consultations on specific matters on sanitary and phytosanitary measures;
e) Establish working groups on animal health, plant and animal health and food safety, and shall determine its mandates, objectives and action lines; and
f) It shall meet once a year, except as otherwise agreed and report annually to the Commission on the implementation of this chapter.
Article 5-13. Technical Cooperation
1. The Parties shall:
a) To facilitate the provision of technical advice, information and assistance on mutually agreed terms and conditions to strengthen their sanitary and phytosanitary measures and their related activities including the investigation process, technology, infrastructure and the establishment of regulatory national bodies. Such assistance may include loans, grants and funds for the acquisition of technical skill training and equipment that will facilitate adjustment and implementation of a sanitary or phytosanitary measure of a party; and
b) Provide information on its technical assistance programmes relating to sanitary or phytosanitary measures in areas of particular interest.
2. The costs of technical assistance activities shall be subject to the availability of funds and priorities for each Party. the expenses arising from the procedures of control or inspection and approval shall be borne by the parties concerned.
Article 5-14. Technical Consultations
1. A Party may request consultations with the other Party regarding any matter relating to this chapter.
2. When a Party requests consultations regarding the implementation of this chapter on a sanitary or phytosanitary measure of the other party and so notifies the Committee on Sanitary and Phytosanitary Measures, it may facilitate consultations. if it does not consider the matter himself, transmit it to an ad hoc working group or another forum, for advice or technical recommendation not mandatory.
3. Each Party may use the good offices of the pertinent international standardization organizations, including those referred to in article 5-04, for advice and assistance on sanitary and phytosanitary matters within the framework of their respective mandates.
Article 5-15. Dispute Settlement
1. Where a Party considers that a sanitary or phytosanitary measure of another party is interpreted or applied in a manner inconsistent with the provisions of this Chapter shall have the burden of proving the inconsistency.
2. Where the parties have had recourse to consultations under paragraphs 1 and 2 of article 5-14, they shall be those provided for in article 20-05, if the parties so agree.
Chapter VI. Rules of Origin
Article 6-01. Definitions
For the purposes of this chapter, the following definitions shall apply:
good: a commodity, product, article or material;
fungible goods: goods that are interchangeable for commercial purposes, whose properties are essentially identical and which it is impractical to differentiate by simple visual examination;
identical or similar goods: "identical goods" and "similar goods", respectively, as defined in the Customs Valuation Code;
goods wholly obtained or produced entirely in the territory of one or both Parties:
a. minerals extracted in the territory of one or both Parties;
b. vegetables harvested in the territory of one or both Parties;
c. live animals, born and bred in the territory of one or both Parties;
d. goods obtained from hunting or fishing in the territory of one or both Parties;
e. fish, crustaceans and other species obtained from the sea by vessels registered or recorded by a Party and flying the flag of that Party;
f. goods produced on board factory ships from the goods identified in subparagraph e), provided that such factory ships are registered or recorded by a Party and are flying the flag of that Party;
g.. goods obtained by a Party or a person of a Party from the seabed or subsoil outside the territorial waters, provided that the Party has rights to exploit that seabed or subsoil;
h. wastes and residues derived from:
(i) production in the territory of one or both of the Parties; or
ii) used goods, collected in the territory of one or both Parties, provided that such goods serve only for the recovery of raw materials; and
i. goods produced in the territory of one or both Parties exclusively from the goods referred to in subparagraphs a) through h) or their derivatives, at any stage of production;
containers and packing materials for shipment: goods that are used to protect a good during transportation, other than containers and materials for retail sale;
shipping and repacking costs: costs incurred in repacking and transporting a good outside the territory where the producer or exporter of the good is located;
sales promotion, marketing and after-sales service costs: the following costs related to sales promotion, marketing and after-sales services:
a. sales promotion and marketing; media advertising; advertising and market research; promotional and demonstration materials; exhibited goods; sales promotion conferences; trade shows and conventions; banners; marketing exhibitions; free samples; sales, marketing and after-sales service publications such as goods brochures, catalogs, technical publications, price lists, service manuals and sales support information; establishment and protection of logos and trademarks; sponsorships; restocking charges for wholesale and retail sales; and representation expenses;
b. marketing, sales or goods incentives; and wholesaler, retailer and consumer rebates;
c. for sales promotion, marketing and after-sales service personnel: salaries and wages; sales commissions; bonuses; medical, insurance and pension benefits; travel, lodging and subsistence expenses; and membership and professional fees;
d. hiring and training of sales promotion, marketing and after-sales service personnel; and training of the client's employees after the sale;
e. insurance premiums for liability insurance on the property;
f. office equipment for sales promotion, marketing and after-sales services;
g. telephone, mail and other means of communication for sales promotion, marketing and after-sales services; h. rents and depreciation;
h. rent and depreciation of sales promotion, marketing and after-sales service offices and distribution centers;
i. property insurance premiums, taxes, utility costs, and repair and maintenance costs of the offices and distribution centers; and
j. payments by the producer to others for warranty repairs;
net cost: total cost less the costs of sales promotion, marketing and after-sales services; royalties; shipping and repacking; as well as ineligible interest costs, as set forth in the annex to Article 6-04;
ineligible interest costs: interest paid by a producer on its financial obligations that exceeds 10 percentage points above the highest interest rate on debt obligations issued by the federal or central government, as the case may be, of the Party in which the producer is located, in accordance with the provisions of the annex to Article 6-04;
total cost: the sum of the following elements in accordance with the provisions of the annex to article 6-04:
a. the costs or value of direct manufacturing materials used in the production of the good;
b. the costs of direct labor used in the production of the good; and
c. an amount for direct and indirect costs and expenses of manufacturing the good, reasonably allocable to the good, except for the following items:
(i) the costs and expenses of a service provided by the producer of a good to another person, when the service does not relate to the good;
ii) costs and losses resulting from the sale of a part of the business of the producer of the good, which constitutes a discontinued operation;
iii) costs related to the cumulative effect of changes in the application of generally accepted accounting principles;
iv) costs or losses resulting from the sale of a capital asset of the producer;
(v) costs and expenses related to acts of God or force majeure; and
(vi) profits earned by the producer of the good, whether retained by that producer or paid to others as dividends and taxes paid on those profits, including capital gains taxes;
direct manufacturing costs and expenses: those incurred in a period, directly related to the good, other than the costs or value of direct materials and direct labor costs;
indirect manufacturing costs and expenses: those incurred in a period, other than direct manufacturing costs and expenses, direct labor costs and direct material costs or value;
F.O.B.: free on board;
place where the producer is located: in relation to a good, the production plant of that good;
material: a good used in the production of another good;
self-produced material: a material produced by the producer of a good and used in the production of that good;
fungible materials: materials that are interchangeable for commercial purposes and whose properties are essentially identical;
indirect material: a material used in the production, testing or inspection of a good, but not physically incorporated in the good; or a material that is used in the maintenance of buildings or operation of equipment related to the production of a good, including:
a. fuel and power;
b. tools, dies and molds;
c. spare or replacement parts and materials used in the maintenance of equipment and buildings;
d. lubricants, greases, composites and other materials used in the production or operation of equipment or buildings;
e. gloves, goggles, footwear, clothing, safety equipment and attachments;
f. equipment, apparatus and attachments used for the verification or inspection of the goods;
g. catalysts and solvents; or
h. any other material that is not incorporated in the good, but whose use in the production of the good can be reasonably demonstrated to be part of that production;
intermediate material: a self-produced material designated in accordance with Article 6-07;
related person: a person who is related to another person, as follows:
a. one of them holds positions of responsibility or management in an enterprise of the other;
b. they are legally recognized as partners in business;
c. they are in the relationship of employer and employee;
d. one person has, directly or indirectly, ownership, control or possession of 25% or more of the outstanding and voting shares or securities of both;
e. one of them directly or indirectly controls the other;
f. both persons are directly or indirectly controlled by a third person;
g. together they directly or indirectly control a third person; or