Title
AGREEMENT BETWEEN JAPAN AND THE REPUBLIC OF CHILE FOR A STRATEGIC ECONOMIC PARTNERSHIP
Preamble
Japan and the Republic of Chile (hereinafter referred to as "Chile"),
Conscious of their longstanding friendship and strong economic and political ties that have developed through many years of fruitful and mutually beneficial cooperation between the Parties;
Recognizing that creating a clearly established and secured trade and investment framework through mutually advantageous rules to govern trade and investment between the Parties would enhance the competitiveness of their economies, make their markets more efficient, and ensure predictable commercial environment for further expansion of trade and investment between them;
Recognizing that an adequate protection of intellectual property and the effective enforcement of competition laws will encourage trade and investment between the Parties;
Believing that a strategic economic partnership between the Parties will bring economic and social benefits, create new and better opportunities for employment, improve the living standards of peoples, and provide a catalyst for the liberalization of trade and investment in the Asia-Pacific region and broader cooperation at international fora;
Convinced that economic development, social development and environmental protection are interdependent and mutually reinforcing pillars of sustainable development and that the strategic economic partnership can play an important role in promoting sustainable development;
Recognizing the rights of the Parties to regulate in order to meet national policy objectives; and
Determined to establish a legal framework for promoting and developing the strategic economic partnership on the basis of the rights and obligations of the Parties under the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh, April 15, 1994 and other international agreements to which both Parties are parties;
HAVE AGREED as follows:
Body
Chapter 1. General Provisions
Article 1. Establishment of a Free-Trade Area
The Parties hereby establish a free-trade area.
Article 2. Objectives
The objectives of this Agreement are to:
(a) liberalize trade in goods between the Parties, in conformity with Article XXIV of the GATT 1994;
(b) liberalize trade in services between the Parties, in conformity with Article V of the GATS;
(c) increase investment opportunities and strengthen protection for investments and investment activities in the Parties;
(d) enhance opportunities for suppliers of the Parties to participate in government procurement in the Parties;
(e) provide an adequate protection of intellectual property and promote cooperation in the field thereof;
(f) promote cooperation and coordination for the effective enforcement of competition laws and regulations in each Party;
(g) improve business environment in the Parties; and
(h) create effective procedures to prevent and resolve disputes.
Article 3. Relation to other Agreements
The Parties reaffirm their rights and obligations under the WTO Agreement or any other agreements to which both Parties are parties.
Article 4. Publication
1. Each Party shall ensure that its laws, regulations and administrative rulings of general application with respect to any matter covered by this Agreement are promptly published or otherwise made publicly available in such a Manner as to enable interested persons and the other Party to become acquainted with them.
2. Each Party shall, upon the request by the other Party, within a reasonable period of time, respond to specific questions from, and provide information to, the other Party with respect to matters referred to in paragraph 1, through contact points referred to in Article 10.
Article 5. Notification
Where a Party considers that any measure that it proposes to take might materially affect the implementation and operation of this Agreement or otherwise substantially affect the other Party's interests under this Agreement, the former Party shall notify the other Party, to the extent practicable, of such measure, through contact points referred to in Article 10.
Article 6. Public Comment
To the extent practicable, each Party shall, in accordance with its laws and regulations:
(a) make public in advance administrative regulations of general application that it proposes to adopt and that affect any matter covered by this Agreement; and
(b) provide a reasonable opportunity for comments by the public before adoption of such regulations.
Article 7. Administrative Procedures
Where administrative decisions which pertain to or affect the implementation and operation of this Agreement are taken by the competent authorities of a Party, the competent authorities shall, in accordance with the laws and regulations of the Party:
(a) inform the applicant of the decision within a reasonable period of time after the submission of the application considered complete under the laws and regulations of the Party;
(b) provide, within a reasonable period of time, information concerning the status of the application, at the request of the applicant; and
(c) afford the applicant a reasonable opportunity to present facts and arguments in support of its positions prior to any final administrative decisions, when time, the nature of the proceeding, and the public interest permit.
Article 8. Review and Appeal
1. Each Party shall establish or maintain judicial or administrative tribunals or procedures for the purpose of the prompt review and, where warranted, correction of administrative actions regarding matters covered by this Agreement. Such tribunals or procedures shall be impartial and independent of the office or authority entrusted with administrative enforcement of such actions and shall not have any substantial interest in the outcome of the matter.
2. Each Party shall ensure that, in any such tribunals or procedures, the parties to the proceedings are provided with the right to:
(a) a reasonable opportunity to support or defend their respective positions; and
(b) a decision based on the evidence and submissions of record.
3. Each Party shall ensure, subject to appeal or further review as provided in its laws and regulations, that such decision is implemented by the offices or authorities with respect to the administrative action at issue.
Article 9. Confidential Information
1. Each Party shall, in accordance with its laws and regulations, maintain the confidentiality of information provided in confidence by the other Party pursuant to this Agreement.
2. Nothing in this Agreement shall require a Party to provide confidential information, the disclosure of which would impede the enforcement of its laws and regulations, or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests of particular enterprises, public or private.
Article 10. Contact Points
Each Party shall designate a contact point to facilitate communications between the Parties on any matter covered by this Agreement.
Chapter 2. General Definitions
Article 11. General Definitions
For the purposes of this Agreement, unless otherwise specified:
(a) the term "Agreement on Customs Valuation" means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement;
(b) the term "Area" means:
(i) with respect to Japan, the territory of Japan, and all the area beyond its territorial sea, including the sea-bed and subsoil thereof, over which Japan exercises sovereign rights or jurisdiction in accordance with international law and the laws and regulations of Japan; and
(ii) with respect to Chile, the land, maritime and air space under its sovereignty, and the exclusive economic zone and the continental shelf within which it exercises sovereign rights and jurisdiction in accordance with international law and its domestic law;
Note: Nothing in subparagraph (b) shall affect the rights and obligations of the Parties under international law, including those under the United Nations Convention on the Law of the Sea.
(c) the term "Commission" means the Commission established under Article 189;
(d) the term "customs authority" means the authority that, according to the legislation of each Party or non-Parties, is responsible for the administration and enforcement of customs laws and regulations:
(i) with respect to Japan, the Ministry of Finance; and
(ii) with respect to Chile, the National Customs Service (Servicio Nacional de Aduanas);
(e) the term "days" means calendar days, including weekends and holidays;
(f) the term "enterprise" means any corporation, company, association, partnership, trust, joint venture, sole-proprietorship or other entity constituted or organized under applicable law, whether for profit or otherwise, and whether privately-owned or controlled or governmentally- owned or controlled;
(g) the term "enterprise of a Party" means an enterprise constituted or organized under the law of a Party;
(h) the term "existing" means in effect on the date of entry into force of this Agreement;
(i) the term "GATS" means the General Agreement on Trade in Services in Annex 1B to the WTO Agreement ;
(j) the term "GATT 1994" means the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement. For the purposes of this Agreement, references to articles in the GATT 1994 include the interpretative notes;
(k) the term "Harmonized System" or "HS" means the Harmonized Commodity Description and Coding System set out in the Annex to the International Convention on the Harmonized Commodity Description and Coding System, and adopted and implemented by the Parties in their respective laws;
(l) the term "measure" means any measure by a Party, whether in the form of a law, regulation, rule, procedure, practice, decision, administrative action or any other form;
(m) the term "natural person of a Party" means a natural person who, under the laws and regulations of a Party:
(i) with respect to Japan, is a national of Japan; and
(ii) with respect to Chile, is a national of Chile or a permanent resident in Chile;
(n) the term "originating good" means a good which qualifies as an originating good under the provisions of Chapter 4;
(o) the term "Parties" means Japan and Chile and the term "Party" means either Japan or Chile;
(p) the term "person" means a natural person or an enterprise;
(q) the term "SPS Agreement" means the Agreement on the Application of Sanitary and Phytosanitary Measures in Annex 1A to the WTO Agreement;
(r) the term "state enterprise" means an enterprise owned or controlled by a Party;
(s) the term "TRIPS Agreement" means the Agreement on Trade-Related Aspects of Intellectual Property Rights in Annex 1C to the WTO Agreement; and
(t) the term "WTO Agreement" means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh, April 15, 1994.
Chapter 3. Trade In Goods
Section 1. General Rules
Article 12. Classification of Goods
The classification of goods in trade between the Parties shall be in conformity with the Harmonized System.
Article 13. National Treatment
Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of the GATT 1994, and to this end Article III of the GATT 1994 is incorporated into and made part of this Agreement, mutatis mutandis.
Article 14. Elimination of Customs Duties
1. Except as otherwise provided for in this Agreement, each Party shall eliminate or reduce its customs duties on originating goods of the other Party designated for such purposes in its Schedule in Annex 1, in accordance with the terms and conditions set out in such Schedule.
2. Except as otherwise provided for in this Agreement, neither Party shall increase any customs duty on originating goods of the other Party from the rate to be applied in accordance with its Schedule in Annex 1.
3. Upon the request of either Party, the Parties shall negotiate on issues such as improving market access conditions on originating goods designated for negotiation in the Schedule in Annex 1, in accordance with the terms and conditions set out in such Schedule.
Article 15. Customs Valuation
For the purposes of determining the customs value of goods traded between the Parties, provisions of Part I of the Agreement on Customs Valuation shall apply mutatis mutandis.
Article 16. Export Duties
Neither Party shall introduce or maintain any duties, or fees or other charges of any kind imposed on a good exported from the Party into the other Party, unless such duties, or fees or other charges are not in excess of those imposed on the like good destined for domestic consumption.
Note: The term "fees or other charges of any kind" shall not include any fees or other charges commensurate with the cost of services rendered, which are consistent with the WTO Agreement.
Article 17. Agricultural Export Subsidies
Taking full account of the objectives of eliminating export subsidies on any agricultural good within the framework of the World Trade Organization, neither Party shall introduce or maintain any export subsidies on any agricultural good which is listed in Annex 1 to the Agreement on Agriculture.
Article 18. Import and Export Restrictions
Except as otherwise provided for in this Agreement, each Party shall not introduce or maintain any prohibition or restriction other than customs duties on the importation of any good of the other Party or on the exportation or sale for export of any good destined to the other Party, which is inconsistent with its obligations under Article XI of the GATT 1994 and its relevant provisions under the WTO Agreement.
Article 19. Restrictions to Safeguard the Balance of Payments
1. Nothing in this Section shall be construed to prevent a Party from taking any measure for balance-of-payments purposes. A Party taking such measure shall do so in accordance with the conditions established under Article XII of the GATT 1994 and the Understanding on the Balance- of-Payments Provisions of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement.
2. Nothing in this Section shall preclude the use by a Party of exchange controls or exchange restrictions in accordance with the Articles of Agreement of the International Monetary Fund.
Section 2. Bilateral Safeguard Measures
Article 20. Bilateral Safeguard Measures
1. Subject to the provisions of this Section, a Party may take a bilateral safeguard measure, to the minimum extent necessary to prevent or remedy the serious injury to a domestic industry of that Party and to facilitate adjustment, if an originating good of the other Party, as a result of the elimination or reduction of a customs duty in accordance with Article 14, is being imported into the former Party in such increased quantities, in absolute terms, and under such conditions that the imports of that originating good constitute a substantial cause of serious injury, or threat thereof.
2. A Party may, as a bilateral safeguard measure:
(a) suspend the further reduction of any rate of customs duty on the originating good provided for in Section 1; or
(b) increase the rate of customs duty on the originating good to a level not to exceed the lesser of:
(i) the most-favored-nation applied rate of customs duty in effect when the bilateral safeguard measure is taken; and
(ii) the most-favored-nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement.
Article 21. Investigation Procedures
1. A Party may take a bilateral safeguard measure only after an investigation has been carried out by the competent authorities of that Party in accordance with the same procedures as those provided for in Article 3 and subparagraph 2(c) of Article 4 of the Agreement on Safeguards.
2. The investigation referred to in paragraph 1 shall in all cases be completed within one year following its date of initiation.
3. In the investigation referred to in paragraph 1 to determine whether increased imports of an originating good have caused or are threatening to cause serious injury to a domestic industry under the terms of this Section, the competent authorities of the Party who carry out the investigation shall evaluate all relevant factors of an objective and quantifiable nature having a bearing on the situation of that domestic industry, in particular, the rate and amount of the increase in imports of the originating good in absolute terms, the share of the domestic market taken by the increased imports of the originating good, and the changes in the level of sales, production, productivity, capacity utilization, profits and losses, and employment.
4. The determination that increased imports of an originating good have caused or are threatening to cause serious injury to a domestic industry shall not be made unless the investigation referred to in paragraph 1 demonstrates, on the basis of objective evidence, the existence of the causal link between increased imports of the originating good and serious injury or threat thereof. When factors other than the increased imports of the originating good are causing injury to the domestic industry at the same time, such injury shall not be attributed to the increased imports of the originating good.
Article 22. Conditions and Limitations
The following conditions and limitations shall apply with regard to a bilateral safeguard measure:
(a) no bilateral safeguard measure shall be maintained except to the extent and for such time as may be necessary to prevent or remedy serious injury and to facilitate adjustment, provided that such time shall not exceed a period of three years. However, in very exceptional circumstances, a bilateral safeguard measure may be extended, provided that the total period of the bilateral safeguard measure, including such extensions, shall not exceed four years;
(b) in order to facilitate adjustment in a situation where the expected duration of a bilateral safeguard measure is over one year, the Party maintaining the bilateral safeguard measure shall progressively liberalize the bilateral safeguard measure at regular intervals during the period of application;
(c) no bilateral safeguard measure shall be applied again to the import of a particular originating good which has been subject to such a bilateral safeguard measure, for a period of time equal to the duration of the previous bilateral safeguard measure or one year, whichever is longer;
(d) nothing in this Section shall prevent a Party from applying safeguard measures to an originating good of the other Party in accordance with:
(i) Article XIX of the GATT 1994 and the Agreement on Safeguards; or
(ii) Article 5 of the Agreement on Agriculture;
(e) no bilateral safeguard measure shall be applied to the import of a particular originating good which has been en route from a Party to the other Party at the time when the other Party notifies the former Party of the decision to apply such a bilateral safeguard measure pursuant to subparagraph 1(b) of Article 23; and
(f) upon the termination of a bilateral safeguard measure, the rate of customs duty shall be the rate which would have been in effect if the bilateral safeguard measure had never been applied.
Article 23. Notification
1. A Party shall immediately deliver a written notice to the other Party upon:
(a) taking a decision to initiate an investigation referred to in paragraph 1 of Article 21 relating to serious injury or threat thereof, and the reasons for it; and
(b) taking a decision to apply, extend or liberalize a bilateral safeguard measure.
2. The Party making the written notice referred to in paragraph 1 shall provide the other Party with all pertinent information, which shall include:
(a) in the written notice referred to in subparagraph 1(a), the reason for the initiation of the investigation, a precise description of the originating good subject to the investigation and its subheading of the Harmonized System, the period subject to the investigation and the date of initiation of the investigation; and
(b) in the written notice referred to in subparagraph 1(b), evidence of serious injury or threat thereof caused by the increased imports of the originating good, a precise description of the originating good subject to the proposed bilateral safeguard measure and its subheading of the Harmonized System, a precise description of the bilateral safeguard measure, and the proposed date of its introduction and its expected duration.
Article 24. Consultations and Compensation
1. A Party proposing to apply or extend a bilateral safeguard measure shall provide adequate opportunity for prior consultations with the other Party with a view to reviewing the information arising from the investigation referred to in paragraph 1 of Article 21, exchanging views on the bilateral safeguard measure and reaching an agreement on compensation set out in this Article.
2. A Party proposing to apply or extend a bilateral safeguard measure shall provide to the other Party mutually agreed adequate means of trade compensation in the form of concessions of customs duties whose levels are substantially equivalent to the value of the additional customs duties expected to result from the bilateral safeguard measure.
3. If the Parties are unable to agree on the compensation within 30 days after the commencement of the consultation pursuant to paragraph 1, the Party against whose originating good the bilateral safeguard measure is taken shall be free to suspend the application of concessions of customs duties under this Agreement, which are substantially equivalent to the bilateral safeguard measure, after giving written notice of such suspension, together with the information regarding concessions to be suspended, to the other Party. The Party exercising the right of suspension may suspend the application of concessions of customs duties only for the minimum period necessary to achieve the substantially equivalent effects and only while the bilateral safeguard measure is maintained.
Article 25. Provisional Bilateral Safeguard Measures
1. In critical circumstances, where delay would cause damage which it would be difficult to repair, a Party may take a provisional bilateral safeguard measure, which shall take the form of the measure set out in subparagraph 2 (a) or (b) of Article 20 pursuant to a preliminary determination that there is clear evidence that increased imports of an originating good of the other Party have caused or are threatening to cause serious injury to a domestic industry.
2. A Party shall deliver a written notice to the other Party prior to applying a provisional bilateral safeguard measure. Consultations between the Parties on the application of the provisional bilateral safeguard measure shall be initiated immediately after the provisional bilateral safeguard measure is taken.
3. The duration of a provisional bilateral safeguard measure shall not exceed 200 days. During that period, the pertinent requirements of Article 21 shall be met. The duration of the provisional bilateral safeguard measure shall be counted as a part of the period referred to in subparagraph (a) of Article 22.
4. Subparagraph (f) of Article 22 and paragraphs 1 and 2 of Article 26 shall be applied mutatis mutandis to a provisional bilateral safeguard measure. The customs duty imposed as a result of a provisional bilateral safeguard measure shall be refunded if the subsequent investigation referred to in paragraph 1 of Article 21 does not determine that increased imports of an originating good of the other Party have caused or threatened to cause serious injury to a domestic industry.
Article 26. Miscellaneous
1. Each Party shall ensure the consistent, impartial and reasonable administration of its laws and regulations relating to bilateral safeguard measure.
2. Each Party shall adopt or maintain equitable, timely, transparent and effective procedures relating to bilateral safeguard measure.
3. The written notice referred to in paragraph 1 of Article 23, paragraph 3 of Article 24 and paragraph 2 of Article 25 and any other communication between the Parties shall be done in the English language.
4. The Parties shall review the provisions of this Section, if necessary, after 10 years of the date of entry into force of this Agreement.