(c) the factual basis for the complaint.
5. The date of the establishment of an arbitral tribunal shall be the date on which the chair is appointed.
Article 179. Terms of Reference of Arbitral Tribunals
Unless the Parties otherwise agree within 20 days from the date of receipt of the request for the establishment of the arbitral tribunal, the terms of reference of the arbitral tribunal shall be:
"To examine, in the light of the relevant provisions of this Agreement, the matter referred to in the request for the establishment of an arbitral tribunal pursuant to Article 178, to make findings of law and fact together with the reasons therefor and to issue an award for the resolution of the dispute."
Article 180. Composition of Arbitral Tribunals
1. An arbitral tribunal shall comprise three arbitrators.
2. Each Party shall, within 30 days after the date of receipt of the request for the establishment of an arbitral tribunal, appoint one arbitrator who may be its national and propose up to three candidates to serve as the third arbitrator who shall be the chair of the arbitral tribunal. The third arbitrator shall not be a national of either Party, nor have his or her usual place of residence in either Party, nor be employed by either Party, nor have dealt with the dispute in any capacity.
3. The Parties shall agree on and appoint the third arbitrator within 45 days after the date of receipt of the request for the establishment of an arbitral tribunal, taking into account the candidates proposed pursuant to paragraph 2.
4. If a Party has not appointed an arbitrator pursuant to paragraph 2 or if the Parties fail to agree on and appoint the third arbitrator pursuant to paragraph 3, the arbitrator or arbitrators not yet appointed shall be chosen within seven days by lot from the candidates proposed pursuant to paragraph 2.
5. All arbitrators shall:
(a) have expertise or experience in law, international trade or other matters covered by this Agreement;
(b) be chosen strictly on the basis of objectivity, reliability and sound judgment;
(c) be independent of, and not be affiliated with or receives instructions from, the Government of either Party; and
(d) comply with a code of conduct, to be provided in the Rules of Procedures referred to in Article 187.
6. If an arbitrator appointed under this Article dies, becomes unable to act or resigns, a successor shall be appointed within 15 days in accordance with the appointment procedure provided for in paragraphs 2, 3 and 4, which shall be applied, respectively, mutatis mutandis. The successor shall have all the powers and duties of the original arbitrator. The work of the arbitral tribunal shall be suspended for a period beginning on the date the original arbitrator dies, becomes unable to act or resigns and ending on the date the successor is appointed.
Article 181. Functions of Arbitral Tribunals
1. The function of an arbitral tribunal is to make an objective assessment of the dispute before it, including an examination of the facts of the case and the applicability of and conformity with this Agreement, and make such other findings and rulings necessary for the resolution of the dispute.
2. The arbitral tribunal should consult with the Parties as appropriate and provide adequate opportunities for the development of a mutually satisfactory resolution.
Article 182. Proceedings of Arbitral Tribunals
1. The arbitral tribunal shall meet in closed session.
2. The Parties shall be given the opportunity to attend any of the presentations, statements or rebuttals in the proceedings. Any information or written submissions submitted by a Party to the arbitral tribunal, including any comments on the draft award and responses to questions put by the arbitral tribunal, shall be made available to the other Party.
3. The arbitral tribunal shall make its decisions, including its award, by consensus but may also make its decisions, including its award, by majority vote.
4. The arbitral tribunal may seek information from any relevant source and may consult experts to obtain their opinion on certain aspects of the matter.
5. The deliberations of the arbitral tribunal and the documents submitted to it shall be kept confidential.
6. Notwithstanding paragraph 5, either Party may make public statements as to its views regarding the dispute, but shall treat as confidential, information and written submissions submitted by the other Party to the arbitral tribunal which that other Party has designated as confidential. Where a Party has provided information or written submissions designated to be confidential, that Party shall, upon request of the other Party, provide a non-confidential summary of the information or written submissions which may be disclosed publicly.
7. Each Party shall bear the cost of its appointed arbitrator and its own expenses. The cost of the chair of an arbitral tribunal and other expenses associated with the conduct of the proceedings shall be borne by the Parties in equal shares.
Article 183. Suspension or Termination of Proceedings
1. The Parties may agree that the arbitral tribunal suspends its work at any time for a period not exceeding 12 months from the date of such agreement. In the event of such a suspension, the time-frames set out in paragraphs 2, 5 and 7 of Article 184 and paragraph 7 of Article 186 shall be extended by the amount of time that the work was suspended. If the work of the arbitral tribunal has been suspended for more than 12 months, the authority for establishment of the arbitral tribunal shall lapse unless the Parties agree otherwise.
2. The Parties may agree to terminate the proceedings of the arbitral tribunal by jointly so notifying the chair of the arbitral tribunal at any time before the issuance of the award to the Parties.
Article 184. Award
1. The award of the arbitral tribunal shall be drafted without the presence of the Parties, and in the light of the information provided and the statements made, and the relevant provisions of this Agreement.
2. The arbitral tribunal shall, within 120 days, or within 60 days in cases of urgency, including those which concern perishable goods, after the date of its establishment, submit to the Parties its draft award.
3. The draft award shall contain both the descriptive part and the findings, conclusions and decisions of the arbitral tribunal, for the purposes of enabling the Parties to review precise aspects of the draft award.
4. When the arbitral tribunal considers that it cannot submit its draft award within the aforementioned 120 days or 60 days period, it may extend that period with the consent of the Parties.
5. A Party may provide written comments to the arbitral tribunal on its draft award within 15 days after the date of submission of the draft award.
6. After considering any written comments on the draft award, the arbitral tribunal may reconsider its draft award and make any further examination it considers appropriate.
7. The arbitral tribunal shall issue its award, within 30 days after the date of submission of the draft award.
8. The award of the arbitral tribunal shall be available to the public within 15 days after the date of issuance, subject to the requirement to protect confidential information.
9. The award of the arbitral tribunal shall be final and binding on the Parties.
Article 185. Implementation of Award
1. Unless the Parties agree otherwise, the Party complained against shall comply with the award of the arbitral tribunal referred to in Article 184 immediately. If this is not practicable, the Party complained against shall comply with the award within a reasonable period of time.
2. The reasonable period of time referred to in paragraph 1 shall be mutually determined by the Parties. Where the Parties fail to agree on the reasonable period of time within 45 days after the date of issuance of the award of the arbitral tribunal referred to in Article 184, either Party may refer the matter to an arbitral tribunal, which shall determine the reasonable period of time.
3. Where there is disagreement between the Parties as to whether the Party complained against has complied with the award of the arbitral tribunal referred to in Article 184 within the reasonable period of time as determined pursuant to paragraph 2, either Party may refer the matter to an arbitral tribunal.
Article 186. Non-Implementation - Compensation and Suspension of Concessions or other Obligations
1. If the Party complained against notifies the complaining Party that it is impracticable, or the arbitral tribunal to which the matter is referred pursuant to paragraph 3 of Article 185 confirms that the Party complained against has failed, to comply with the award within the reasonable period of time as determined pursuant to paragraph 2 of Article 185, the Party complained against shall, if so requested, enter into negotiations with the complaining Party with a view to reaching a mutually satisfactory compensation.
2. If there is no agreement on satisfactory compensation within 20 days after the date of receipt of the request mentioned in paragraph 1, the complaining Party may suspend the application to the Party complained against of concessions or other obligations under this Agreement, after giving notification of such suspension 30 days in advance.
3. The compensation referred to in paragraph 1 and the suspension referred to in paragraph 2 shall be temporary measures. Neither compensation nor suspension is preferred to full compliance with the award. The suspension shall only be applied until such time as the award is fully complied with, or a mutually satisfactory solution is reached.
4. In considering what concessions or other obligations to suspend pursuant to paragraph 2:
(a) the complaining Party should first seek to suspend concessions or other obligations with respect to the same sector(s) as that in which the arbitral tribunal referred to in Article 184 has found a failure to comply with the obligations under this Agreement, or nullification or impairment of benefits in the sense of paragraph 2 of Article 178; and
(b) if the complaining Party considers that it is not practicable or effective to suspend concessions or other obligations with respect to the same sector(s), it may suspend concessions or other obligations with respect to other sectors. The notification of such suspension pursuant to paragraph 2 shall indicate the reasons on which it is based.
5. The level of suspension referred to in paragraph 2 shall be equivalent to the level of the nullification or impairment.
6. If the Party complained against considers that the requirements for the suspension of concessions or other obligations by the complaining Party set out in paragraph 2, 3, 4 or 5 have not been met, it may refer the matter to an arbitral tribunal.
7. The arbitral tribunal that is established for the purposes of this Article or Article 185 shall, wherever possible, have, as its arbitrators, the arbitrators of the original arbitral tribunal. If this is not possible, then the arbitrators to the arbitral tribunal that is established for the purposes of this Article or Article 185 shall be appointed pursuant to Article 180. The arbitral tribunal established under this Article or Article 185 shall issue its award within 60 days after the date when the matter is referred to it. When the arbitral tribunal considers that it cannot issue its award within the aforementioned 60 days period, it may extend that period for a maximum of 30 days with the consent of the Parties. The award shall be available to the public within 15 days after the date of issuance, subject to the requirement to protect confidential information. The award shall be final and binding on the Parties.
Article 187. Rules of Procedures
The Commission shall adopt the Rules of Procedures which provide for the details of the rules and procedures of arbitral tribunals established under this Chapter, upon the entry into force of this Agreement.
Article 188. Modification of Rules and Procedures
Any time period, or other rules and procedures for arbitral tribunals, provided for in this Chapter, including the Rules of Procedures referred to in Article 187, may be modified by mutual consent of the Parties.
Chapter 17. Commission
Article 189. Establishment of the Commission
The Parties hereby establish a Commission which shall be co-chaired by Ministers or senior officials of the Parties.
Article 190. Functions of the Commission
1. The Commission shall: (a) review and monitor, and consider any matters relating to, the implementation, interpretation and operation of this Agreement;
(b) consider and recommend to the Parties any amendments to this Agreement;
(c) supervise and coordinate the work of all committees and working groups established under this Agreement;
(d) adopt:
(i) modifications to Annex 15;
(ii) the Operational Procedures referred to in Article 52;
(iii) an interpretation of a provision of this Agreement referred to in Articles 93 and 94;
(iv) the Rules of Procedures referred to in Article 187; and
(v) any necessary decisions; and
(e) carry out other functions as the Parties may agree.
2. The Commission may establish committees and working groups, refer matters to any committee or working group for advice, delegate its responsibilities to any committee or working group, and consider matters raised by any committee or working group.
Article 191. Rules and Procedures of the Commission
1. The Commission shall establish its rules and procedures.
2. Decisions of the Commission shall be taken by mutual agreement.
3. The Commission shall meet at such venues and times as may be agreed by the Parties.
Chapter 18. Exceptions
Article 192. General Exceptions
1. For the purposes of Chapters 3, 4, 5, 6, 7 and 8 other than Article 76, Article XX of the GATT 1994 is incorporated into and made part of this Agreement, mutatis mutandis.
2. For the purposes of Chapters 8 other than Article 76, 9, 10 and 11, Article XIV of the GATS, including its footnotes, is incorporated into and made part of this Agreement, mutatis mutandis.
Article 193. Security Exceptions
Nothing in this Agreement other than Article 76 shall be construed:
(a) to require a Party to furnish any information the disclosure of which it considers contrary to its essential security interests;
(b) to prevent a Party from taking any actions which it considers necessary for the protection of its essential security interests:
(i) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials, or such supply of services, as is carried on directly or indirectly for the purpose of supplying or provisioning a military establishment;
(ii) taken in time of war or other emergency in international relations; or
(iii) relating to fissionable and fusionable materials or the materials from which they are derived; or
(c) to prevent a Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
Article 194. Taxation
1. Except as otherwise provided for in this Article, nothing in this Agreement shall apply to taxation measures.
Note: The term "taxation measures" shall not include:
(a) a customs duty as defined in subparagraph (d) of Article 28;
(b) an anti-dumping or countervailing duty referred to in subparagraph (d) (ii) of Article 28; and
(c) fees or charges referred to in subparagraph (d) (iii) of Article 28.
2. Nothing in this Agreement shall affect the rights and obligations of either Party under the provisions relating to any taxation measures in any other international agreements to which both Parties are parties.
3. Article 13 shall apply to taxation measures to the same extent as Article III of the GATT 1994.
4. Articles 107 and 108 shall apply to taxation measures to the same extent as covered by the GATS.
5. (a) Article 82 shall apply to taxation measures except that no investor may invoke Article 82 as the basis for a claim under Article 89, where it has been determined pursuant to subparagraph (b) that the measure is not an expropriation.
(b) The investor shall refer the issue, at the time that it delivers the notice of intent under Article 89, to the competent authorities of both Parties, through the contact points referred to in Article 10, to determine whether such measure is not an expropriation. If the competent authorities of both Parties do not consider the issue or, having considered it, fail to determine that the measure is not an expropriation within a period of 180 days of such referral, the investor may submit its claim to arbitration under Article 89.
(c) For the purposes of subparagraph (b), the term "competent authorities" means:
(i) with respect to Japan, the Minister of Finance or his or her authorized representative, who shall consider the issue in consultation with the Minister of Foreign Affairs or his or her authorized representative; and
(ii) with respect to Chile, the Director of the Internal Revenue Service, Ministry of Finance (Director del Servicio de Impuestos Internos, Ministerio de Hacienda) .
Chapter 19. Final Provisions
Article 195. Annexes and Notes
The Annexes and Notes to this Agreement shall constitute an integral part of this Agreement.
Article 196. Headings
The headings of the Chapters, Sections and Articles of this Agreement are inserted for convenience of reference only and shall not affect the interpretation of this Agreement.
Article 197. Amendments
1. This Agreement may be amended by agreement between the Parties.
2. Any amendment shall be approved by the Parties in accordance with their respective legal procedures. Such amendment shall enter into force on the date to be agreed upon by the Parties.
3. Notwithstanding paragraph 2, amendments relating only to Annex 2 or 4 may be made by exchange of diplomatic notes.
Note: In the case of Chile, the amendments under paragraph 3 shall be made as an Executive Agreement (Acuerdo de Ejecución) in accordance with the Political Constitution of the Republic of Chile (Constitución Política de la República de Chile).
Article 198. Entry Into Force
This Agreement shall enter into force on the thirtieth day after the date of exchange of diplomatic notes informing each other that their respective legal procedures necessary for entry into force of this Agreement have been completed. It shall remain in force unless terminated as provided for in Article 199.
Article 199. Termination
Either Party may terminate this Agreement by giving one year's advance notice in writing to the other Party.
Conclusion
IN WITNESS WHEREOF, the undersigned, being duly authorized by their respective Governments, have signed this Agreement.
DONE at Tokyo, on this twenty-seventh day of March in the year 2007 in duplicate in the English language.
For Japan:
For the Republic of Chile:
Attachments
Annex 5. referred to in Chapters 8 and 10 Decree Law 600
1. The obligations and commitments contained in Chapters 8 and 10, do not apply to Decree-Law 600, Foreign Investment Statute (Decreto Ley 600, Estatuto de la Inversión Extranjera) (hereinafter referred to in this Annex as "DL 600"), to Law 18.657, Foreign Capital Investment Fund Law (Ley 18.657, Ley de Fondos de Inversión de Capital Extranjero), to the continuation or prompt renewal of such laws, to amendments to those laws or to any special and/or voluntary investment regime that may be adopted in the future by Chile.
2. For greater certainty, it is understood that the Foreign Investment Committee of Chile has the right to reject applications to invest through DL 600 and Law 18.657. Additionally, the Foreign Investment Committee has the right to regulate the terms and conditions of foreign investment under DL 600 and Law 18.657.
3. Notwithstanding paragraphs 1 and 2, Chile shall accord to an investor of Japan or its investment that is a party to an investment contract under DL 600, the better of the treatment required under Section 1 of Chapter 8, and Chapter 10, or the treatment under the investment contract.
4. Chile shall permit an investor of Japan or its investment that has entered into an investment contract under DL 600 to amend the investment contract to make it consistent with the obligation referred to in paragraph 3.
Annex 6. referred to in Chapters 8 and 9 Reservations for Existing Measures
1. The Schedule of a Party sets out, pursuant to paragraph 1 of Article 79 and paragraph 1 of Article 110, the reservations taken by that Party with respect to existing measures that do not conform with obligations imposed by:
(a) Article 73 or 107;
(b) Article 74 or 108;
(c) Article 77;
(d) Article 78; or
(e) Article 109.
2. Each reservation sets out the following elements:
(a) "Sector" refers to the general sector in which the reservation is taken;
(b) "Sub-Sector" refers to the specific sector in which the reservation is taken;
(c) "Industry Classification" refers, where applicable, and only for transparency purposes, to the activity covered by the reservation according to domestic or international industry classification codes;
(d) "Type of Reservation" specifies the obligations referred to in paragraph 1 for which the reservation is taken;
(e) "Level of Government" indicates the level of government maintaining the measure for which the reservation is taken;
(f) "Measures" identifies the existing laws, regulations or other measures for which the reservation is taken. A measure cited in the "Measures" element:
(i) means the measure as amended, continued, or renewed as of the date of entry into force of this Agreement, and
(ii) includes any subordinate measure adopted or maintained under the authority of and consistent with the measure; and
(g) "Description" sets out, with regard to the obligations referred to in paragraph 1, the non-conforming aspects of the existing measures for which the reservation is taken.
3. In the interpretation of a reservation, all elements of the reservation shall be considered. A reservation shall be interpreted in the light of the relevant provisions of the Chapters against which the reservation is taken, and the "Measures" element shall prevail over all other elements.
4. In accordance with subparagraph 1(a) of Article 79 and subparagraph 1(a) of Article 110, the obligations specified in the "Type of Reservation" element do not apply to the laws, regulations or other measures identified in the "Measures" element.
5. Where a Party maintains a measure that requires that a service supplier be a natural person or resident of that Party as a condition to the supply of a service in its Area, a reservation for that measure taken with respect to Article 107, 108 or 109 shall operate as a reservation with respect to Article 73, 74 or 77 to the extent of that measure.
6. For the purposes of this Annex:
(a) the term "JSIC" means Japan Standard Industrial Classification set out by the Statistics Bureau, Ministry of Internal Affairs and Communications, and revised on March 7, 2002; and