(b) identification of the Certificate of Origin which led to the verification;
(c) identification of the products under verification;
(d) identification of the participants, including the institutions they represent; and
(e) a record of the proceedings.
Article 3.23 Release of Products
Upon reasonable suspicion regarding the origin of the products, the importing Party, subject to and in accordance with its laws and regulations, may as a condition for the release of the products:
(a) request the importer to provide a guarantee in any of its modalities; or
(b) take any action necessary in order to preserve fiscal interests as a pre-condition for the completion of the importation operations.
Article 3.24 Confidentiality
1. The information obtained by the competent authority of the importing Party may be used for the purpose of at a decision regarding the determination of origin in respect of the product under verification or during legal proceedings concerning issues under this Chapter and in accordance with each Party’s respective laws and regulations.
2. Each Party shall protect such information from any unauthorised disclosure, in accordance with-its respective laws and regulations.
Article 3.25
Denial of Preferential Treatment
1. Except as otherwise provided in this Chapter, the importing Party may deny a claim for preferential tariff treatment, if:
(a) the importing party determines that the products do not meet the requirements of this Chapter;
(b) the importer, exporter or producer fails to comply with the relevant requirements of this Chapter including those in Article 3.18 (Record Keeping), Article 3.19 (Obligations of the Exporter or Producer) or Article 3.22 (Procedure for Verification);
(c) the Certificate of Origin does not meet the requirements of this Chapter; or
(d) the exporting Party refuses or fails to respond to the competent authority of the importing Party in accordance with Article 3.22 (Procedure for Verification).
2. In cases where the Certificate of Origin is rejected by the Customs Administration of the importing Party, after following the due process provided under its laws, a copy of the decision, containing the grounds of rejection, shall be notified to the importer.
Article 3.26
Products Complying with Rules of Origin
If a verification conducted under Article 3.21 (Verification of Certificates of Origin), determines that the products comply with the rules of origin under this Chapter, the importer shall be promptly refunded the duties paid in excess of the preferential duty or release guarantees obtained in accordance with importing Party's laws and regulations.
Article 3.27
Prospective Restoration of Preferential Benefits
1. Where preferential treatment for a product has been denied by the Customs Administration of the importing Party prospectively or retrospectively, the exporter or producer may take recourse to the procedure in paragraph 2 in respect of future exports to the importing Party.
2. Such exporter or producer shall clearly demonstrate to the satisfaction of the competent authority of the exporting Party that the manufacturing conditions were modified so as to fulfil the origin requirements of the rules of origin under this Chapter.
3. The competent authority of the exporting Party shall send the information to the competent authority of the importing Party explaining the changes carried out by the exporter or producer in the manufacturing conditions as a consequence of which the products fulfil the origin criterion.
4. If deemed necessary, the competent authority of the importing Party, shall within 45 days from the date of the receipt of the information, request for a verification visit to the producer's premises, for satisfying itself of the veracity of the claims of the exporter or producer referred in paragraph 2.
5. The prospective restoration of preferential benefits would be granted by the competent authority of the importing Party, if the veracity of the claims of the exporter or producer are established.
6. If the competent authorities of the Parties fail to agree on the fulfilment of the rules of origin under this Chapter subsequent to the modification of the manufacturing conditions, they may refer the matter to the Subcommittee established under Article 3.31 (Cooperation) for a decision.
Article 3.28
Temporary Suspension of Preferential Treatment
1. The importing Party may suspend the preferential tariff treatment in respect of a product originating in the exporting Party when the suspension is justified due to persistent failure to comply with the provisions of this Chapter by an exporter or producer in the exporting Party or a persistent failure on the part of the competent authority of the exporting Party to respond to a request for verification.
2. The importing Party shall, within 90 days from the date of suspension of the preferential tariff treatment for a product, notify the exporting Party in writing of the reasons for such suspension.
3. Upon receipt of the notification of the suspension, the competent authority of the exporting Party may request consultations.
4. The consultations may be conducted by electronic means, including, video conference, or by in-person meetings, as mutually agreed, and may also involve joint verification.
5. Pursuant to the consultations between the Parties, and such measures as they may mutually agree, the Parties shall resolve to:
(a) restore preferential tariff treatment to the product with retrospective effect;
(b) restore preferential tariff treatment to the product with prospective effect, subject to implementation of any mutually agreed measures by one or both Parties; or
(c) continue with the suspension of preferential tariff treatment to the product, subject to remedies available under Article 3.27 (Prospective Restoration of Preferential Benefits).
Article 3.29
Non-Compliance of Products with Rules of Origin and Penalties
1. If the verification under Article 3.21 (Verification of Certificates of Origin) establishes the non-compliance of products with the rules of origin, duties shall be levied in accordance with the laws and regulations of the importing Party.
2. Each Party shall also adopt or maintain measures that provide for the imposition of sanctions for violations of its customs laws and regulations, including those governing rules of origin and the entitlement to preferential tariff treatment under this Agreement.
Article 3.30 Relevant Dates
The time periods set out in this Chapter shall be calculated on a consecutive day basis from the day following the fact or event to which they refer.
Article 3.31 Cooperation
1. The Parties hereby establish a. Subcommittee on Rules of Origin to oversee the implementation of this Chapter, under the CTG.
2. The Subcommittee on Rules of Origin shall comprise of officials of the competent authorities, the Customs Administration and the issuing authorities of the Parties.
3. The Subcommittee on Rules of Origin shall meet at least once annually for the furtherance of the objectives of this Chapter, including to enhance mutual capacity building to facilitate the smooth implementation of the procedures under this Chapter and to explore ways and means for utilising information technology-enabled services for the issuance and verification of the Certificate of Origin.
4. The Subcommittee on Rules of Origin will also evaluate and decide on whether to continue with the issuance of the Certificate of Origin by the issuing authority of each Party, or to switch to self-certification procedures. If either Party is not ready to switch to self-certification during the first regular review session, the issue shall be deferred to subsequent reviews until such time where both Parties can agree to adopt the self-certification procedures.
5. The Subcommittee on Rules of Origin may refer any matter to the Joint Committee.
Article 3.32 Consultation and Modifications
1. The Parties shall consult and cooperate through the Subcommittee on Rules of Origin as appropriate to:
(a) ensure that this Chapter is applied in an effective and uniform manner; and
(b) discuss necessary amendments to this Chapter, taking into account developments in technology, production processes, and other related matters.
Article 3.33
Exchange of Electronic Data on Origin
The Parties endeavour to develop an electronic system for information exchange on origin to ensure the effective and efficient implementation of this Chapter particularly on transmission of electronic Certificate of Origin.
Article 3.34 Origin Declaration
For the purposes of subparagraph 1(c) of Article 3.13 (Proof of Origin), the Parties endeavour to negotiate, agree on, and implement provisions allowing each competent authority to recognise an origin declaration made by an approved exporter.
Chapter 4. SANITARY AND PHYTOSANITARY MEASURES
Article 4.1 Definitions
For the purposes of this Chapter:
1. "SPS Agreement" means the Agreement on the Application of Sanitary and Phytosanitary Measures, set out in Annex 1A to the WTO Agreement.
2. The definitions under Annex A of the SPS Agreement shall apply.
3. Relevant definitions developed by Codex Alimentarius Commission (Codex), the World Organisation for Animal Health (WOAH), and the International Plant Protection Convention (IPPC) shall apply.
4.- '"Competent authorities" mean those authorities within each Party recognised by the national government as responsible for developing and administering the SPS measures within that Party.
5. An "emergency measure" means a sanitary or phytosanitary measure that is applied by a Party to products of the other Party to address an urgent problem of human, animal or plant life or health protection that arises or threatens to arise in the Party applying the measure.
Article 4.2 Objectives
1. The objectives of this Chapter are to:
(a) protect human, animal or plant life or health in the territories of the Parties while facilitating trade between them;
(b) reinforce the SPS Agreement;
(c) strengthen communication, consultation, and cooperation between the Parties, and particularly between the Parties' competent authorities;
(d) ensure that sanitary or phytosanitary measures implemented by a Party do not create unjustified barriers to trade;
(e) enhance transpareney in and understanding of the-application of each Party's sanitary and phytosanitary measures; and
(f) encourage the development and adoption of science-based international standards, guidelines, and recommendations, and promote their implementation by the Parties.
Article 4.3 Scope
This Chapter shall apply to all sanitary and phytosanitary measures of a Party that may, directly or indirectly, affect trade between the Parties.
Article 4.4 General Provision
1. The Parties affirm their rights and obligations with respect to each other under the SPS Agreement.
2. In the event of any conflict between the definitions under the SPS Agreement and any of the other sources specified in paragraph 3 of Article 4.1 (Definitions), the definitions under the SPS Agreement shall prevail.
Article 4.5 Equivalence
1. Both Parties shall strengthen cooperation on equivalence in accordance with Article 4 of the SPS Agreement while taking into account relevant decisions of the WTO SPS Committee and international standards, guidelines and recommendations, in accordance with Annex A of the SPS Agreement, mutatis mutandis.
2. The importing Party shall recognise the equivalence of a sanitary and phytosanitary measure if the exporting Party objectively demonstrates to the importing Party that its measure achieves the same level of protection as the importing Party's measure or that its measure has the same effect in achieving the objective as the importing Party's measure.
3. In determining equivalence, the importing Party shall take into account existing knowledge, information and experience as well as the regulatory competence of the exporting Party.
4. A Party shall, upon request, enter into consultation with the aim of achieving bilateral recognition arrangements of equivalence of specified sanitary and phytosanitary measures. The recognition of equivalence may be with respect to a single measure, group of measures or on a systems-wide basis. For this purpose, reasonable access shall be given, upon request, to the importing Party for inspection, testing and other relevant procedures.
5. As part of the consultation for equivalence recognition, on request by the exporting Party, the importing Party shall explain and provide:
(a) the rationale and objective of its measures; and
(b) the specific risks its measures are intended to address.
6. The exporting Party shall provide necessary information for the importing Party to commence an equivalence assessment. Once the assessment commences, the importing Party shall, without undue delay and upon request, explain the process and plan for making an equivalence determination.
7. The consideration by a Party of a request from the other Party for recognition of equivalence of its measures with regard to a specific product, or group of products, shall not be in itself a reason to disrupt or suspend ongoing imports from the Party of the product(s) in question.
8. When the importing Party recognises the equivalence of the exporting Party's specific sanitary and phytosanitary measure, group of measures or measures on a systems-wide basis, the importing Party shall communicate the decision in writing to the exporting Party and implement the measure within a reasonable period of time. The rationale shall be provided in writing by the importing Party in the event that the decision is negative.
9. The importing Party may withdraw or suspend equivalence on the basis of any amendment, by one of the Parties, of measures affecting equivalence, in accordance with the following provisions:
(a) the exporting Party shall inform the importing Party of any proposal for amendment of its measures for which equivalence of measures is recognised and the likely effect of the proposed measures on the equivalence which has been recognised;
(b) within 60 working days or as mutually agreed by the Parties on receipt of this information, the importing Party shall inform the exporting Party whether or not equivalence would continue to be recognised on the basis of the proposed measures;
(c) the importing Party shall inform the exporting Party of any proposal for amendment of its measures on which recognition of equivalence has been based and the likely effect of the proposed measures on the equivalence which has been recognised; and
(d) in case of non-recognition or withdrawal or suspension of equivalence, the importing Party shall indicate to the exporting Party the required conditions on which the process referred to in paragraphs 4 and 5 may be reinitiated, provided that the timelines of paragraph 6 shall be adhered to in any process for re-assessment of equivalence.
10. The withdrawal or suspension of equivalence rests solely with the importing Party acting in accordance with its administrative and legislative framework which shall adhere to the international standards, guidelines and recommendations. The importing Party shall provide to the exporting Party, upon request, an explanation for its determinations and decisions, except for disclosure of confidential data.
11. Compliance by an exported product that has been accepted as equivalent to sanitary and phytosanitary measures and standards of the importing Party shall not remove the need for that product to comply with any other relevant mandatory requirements of the importing Party.
Article 4.6
Adaptation to Regional Conditions, including Pest- or Disease-Free Areas and Areas of Low Pest or Disease Prevalence
1. Both Parties recognise the concepts of regional conditions, including pest-or disease-free_areas and areas of low pest or disease prevalence, zoning and compertmentalisation. Parties shall take into account the relevant decisions of the WTO SPS Committee and international standards, guidelines, and recommendations.
2. Both Parties may cooperate on the recognition of regional conditions with the objective of acquiring confidence in the procedures followed by each other for such recognition.
3. At the request of the exporting Party, the importing Party shall, without undue delay, explain its process and plan for making the determination of regional conditions.
4. When the importing Party has received a request for a determination of regional conditions from the exporting Party, and has determined that the information provided by the exporting Party is sufficient, it shall initiate the assessment within a reasonable period of time.
5. For this assessment, reasonable access shall be given, upon request, to the importing Party for inspection, testing and other relevant procedures.
6. On request of the exporting Party, the importing Party shall inform the exporting Party of the status of the assessment.
7. When the importing Party recognises specific regional conditions of an exporting Party, the importing Party shall communicate that decision to the exporting Party in writing and implement the measures within a reasonable period of time.
8. If the evaluation of the evidence provided by the exporting Party does not result in a decision by the importing Party to recognise the regional conditions, the importing Party shall provide the exporting Party the rationale for its decision in writing within a reasonable period of time.
9. Where a determination recognising regional conditions is made, the Parties are encouraged, where mutually agreed, to report the outcome to the WTO SPS Committee.
Article 4.7 Risk Analysis
1. The Parties shall strengthen their cooperation on risk analysis in accordance with the SPS Agreement while taking into account the relevant decisions of the WTO SPS Committee and international standards, guidelines, and recommendations.
2. When conducting a risk analysis, an importing Party shall:
(a) ensure that the risk analysis is documented and that it provides the exporting Party with an opportunity to comment in a manner to be determined by the importing Party;
(b) consider risk management options that are not more trade restrictive than required to achieve its appropriate level of sanitary or phytosanitary protection; and
(c) select a risk management option that is not more trade restrictive than required to achieve its appropriate level of sanitary or phytosanitary protection, taking into account technical and economic feasibility.
3. On request of the exporting Party, the importing Party shall inform the exporting Party of the progress of a··specific risk analysis request, and of any delay that may occur during the process.
4. Without prejudice to the Parties' right to take emergency measures consistent with Article 4.9 (Emergency Measures), no Party shall stop the importation of a good of the other Party solely for the reason that the importing Party is undertaking a review of a sanitary or phytosanitary measure, if the importing Party permitted importation of the good of the other Party at the time of the initiation of the review.
Article 4.8
Audit, Certification and Import Checks
1. The Parties shall ensure that their import procedures comply with Annex C of the SPS Agreement including audit, certification, and import checks.
2. When conducting an audit, the Parties agree that:
(a) audits shall be systems-based and designed to check the effectiveness of the regulatory controls of the competent authorities of the exporting Party. Audits may include an assessment of the competent authorities' control programme, including, where appropriate, reviews of the inspection and audit programmes, and on-site inspections of facilities, without prejudice to the rights of a Party to seek market access on the basis of individual inspection and audits;
(b) prior to commencement of an audit, both Parties shall discuss and agree, inter alia:
(i) the rationale for and the objectives and scope of the audit;
(ii) the criteria or requirements against which the exporting Party will be assessed; and
(iii) the itinerary and procedures for conducting the audit;
(c) the auditing Party shall provide the audited Party the opportunity to comment on the finding of an audit and take any such comments into account before making its conclusions and taking any action;
(d) any decisions or actions taken by the auditing Party as a result of the audit shall be supported by objective evidence and data which can be verified, tking into account the knowledge, relevant experience, and confidence that the auditing Party has with the audited Party. Any such objective evidence and data shall be provided to the audited Party on request;
(e) any costs incurred by the auditing Party shall be borne by the auditing Party, unless the Parties agree otherwise; and
(f) the auditing Party and the audited Party shall each ensure that procedures are in place to prevent the disclosure of confidential information acquired during the auditing process.
3. When conducting certification, the Parties agree that:
(a) where certification is required for trade in a product, the importing Party shall ensure such certification is applied, in meeting its sanitary or phytosanitary objectives, only to the extent necessary to protect human, animal and plant life or health;
(b) in applying certification requirements, each Party shall take into account relevant decisions from the WTO SPS Committee and international standards, guidelines, and recommendations;
(c) the Parties shall promote the implementation of electronic certification and other technologies to facilitate trade; and
(d) without prejudice to each Party's right to use import controls, the importing Party shall accept certificates issued by the competent authorities in compliance with the regulatory requirements of the importing Party.
4. When conducting import checks, the Parties agree that:
(a) both Parties shall ensure that their control, inspection and approval procedures are in accordance with Annex C of the SPS Agreement;
(b) the import checks applied to imported animals, animal products, plants and plant products traded between the Parties shall be based on the risk associated with such importations. The import checks shall be carried out in a manner that is appropriate to the risk involved, without undue delay, and shall be least trade-restrictive; and
(c) unless there is a clearly identified risk in holding a consignment, the consignment shall not be destroyed without affording an opportunity to the importer to take back the consignment.
5. In the case of non-compliant consignments, both Parties agree to share relevant laboratory reports, if any.
Article 4.9 Emergency Measures
1. If a Party adopts an emergency measure that is necessary for the protection of human, animal or plant life or health and that may have an effect on trade, the Party shall promptly notify, in writing, in the English language, the other Party of that measure through the relevant contact point referred to in Article 4.13 (Contact Points and Competent Authorities). The importing Party shall take into consideration any information provided by the other Party in response to the notification.
2. If a Party adopts an emergency measure, it shall review the measure within 8 months or any other such time as agreed by the Parties and make available the results of the review to the other Party on request. If the emergency measure is maintained after the review, because the reason for its adoption remains, the Party may review the measure every 6 months.
Article 4.10 Transparency
1. The Parties recognise the value of transparency in the adoption and application of sanitary and phytosanitary measures and the importance of sharing information on such measures on an ongoing basis.
2. Each Party shall notify proposed measures or changes to sanitary or phytosanitary measures that may have a significant effect on the trade of the other Party through the online WTO Sanitary and Phytosanitary Measures Notifiyation Submission System, the contact points designated under Article 4.13 (Contact Points and Competent Authorities), or through already established communication channels of the Parties.
3. In implementing this Article, both Parties shall take into account relevant decisions of the WTO SPS Committee and international standards, guidelines, and recommendations.
4. A Party, upon request from the other Party, shall provide relevant information and clarification regarding any sanitary or phytosanitary measure to the requesting Party within a reasonable period of time including: