(c) the production of the good in the form in which the good is exported from its territory.
Article 4.18. Exceptions
Provided that it is not part of two or more imports made or intended to be made for the purpose of circumventing the certification requirements of Articles 4.14 and 4.15, a Party shall not require a certificate of origin in the following cases:
(a) in the case of a commercial importation of a good the customs value of which does not exceed one thousand United States dollars (US$ 1000), or its equivalent in national currency, or such greater amount as that Party may specify, but may require that the commercial invoice contain or be accompanied by a declaration by the importer or exporter that the good qualifies as originating;
(b) in the case of an importation for non-commercial purposes of a good the customs value of which does not exceed one thousand United States dollars (US$ 1000), or its equivalent in national currency, or such greater amount as that Party may establish; or
(c) in the case of an import of a good for which the importing Party has waived the requirement to present a certificate of origin.
Article 4.19. Verifications of Origin
1. The importing Party may request the exporter to provide information regarding the origin of any imported good.
2. For the purpose of determining whether a good imported into its territory from the territory of the other Party qualifies as originating, the importing Party may, through its customs authorities, carry out the verification of origin only by:
(a) written questionnaires or requests for information addressed to the exporter or producer in the territory of the other Party;
(b) visits to the premises of an exporter or producer in the territory of the other Party, for the purpose of examining the records referred to in Article 4.17 and inspect the facilities used in the production of the goods, or, where appropriate, any facilities used in the production of the materials; or (c) such other procedures as the Parties may agree.
3. An exporter or producer receiving a questionnaire under paragraph 2(a) shall complete and return it within 30 days of the date of its receipt. During this period, the exporter or producer may, on a single occasion, make a written request to the importing Party for an extension of the original period, which may not exceed 30 days.
4. In case the exporter or producer fails to return the correctly completed questionnaire within the prescribed time limit or extension period, the importing Party may refuse the preferential tariff treatment.
5. Before conducting a verification visit in accordance with subparagraph 2(b), the Party shall be obliged, through its customs authorities:
(a) to notify in writing its intention to carry out the visit:
(i) the exporter or producer whose premises are to be visited,
(ii) to the customs authorities of the other Party, and
(iii) the embassy of the other Party in the territory of the importing Party that intends to carry out the visit, if the other Party so requests; and
(b) obtain the written consent of the exporter or producer whose premises are to be visited.
6. The notification referred to in paragraph 5 shall contain at least the following elements:
(a) the identification of the competent authority making the notification;
(b) the name of the exporter or producer to be visited;
(c) the date and place of the proposed verification visit;
(d) the purpose and scope of the proposed verification visit, with specific mention of the good(s) to be verified;
(e) the identification and titles of the officials who will carry out the verification visit; and
(f) the legal basis for the verification visit.
7. If within 30 days of receipt of notification of the proposed verification visit pursuant to paragraph 5, the exporter or producer does not consent in writing to the verification visit, the notifying Party may deny preferential tariff treatment to the good that was the subject of the visit.
8. Each Party shall provide that, where an exporter or producer receives a notification under paragraph 5, it may, within 15 days of receipt of the notification, postpone the proposed verification visit for a period not exceeding 60 days from the date on which the notification was received. However, the visit may be postponed only once. For this purpose, the customs authorities of the importing and exporting Party shall be notified of the postponement.
9. A Party may not deny preferential tariff treatment to a good solely on the basis of the extension of the verification visit under paragraph 7.
10. Each Party shall allow the exporter or producer of a good that is the subject of a verification visit by the other Party to designate 2 observers, who shall be present during the visit, provided that:
(a) observers intervene only in that capacity; and
(b) failure by the exporter or producer to designate observers does not lead to an extension of the visit.
11. Each Party conducting a verification of origin in which Generally Accepted Accounting Principles are relevant shall apply those principles as applied in the territory of the Party from which the good was exported.
12. Upon completion of a verification, the customs authorities carrying out the verification shall deliver a written determination to the exporter or producer whose goods are subject to the verification, determining whether the goods qualify as originating. Such resolution shall also include the findings of fact and legal grounds for the determination and shall be issued within a period not exceeding 60 days from the date of conclusion of the verification.
13. Where a Party's verifications indicate that the exporter or producer has made recurring false or unfounded false or unfounded representations that a good imported into its territory qualifies as originating, the Party may suspend preferential tariff treatment for identical goods exported or produced by that person until that person demonstrates compliance with the provisions of this Chapter.
Article 4.20. Invoicing by a Non-Party Operator and Uniform Regulations
1. In cases where the goods are invoiced by an operator in a non-Party, the exporter of the originating Party shall indicate in the "Remarks" box of the relevant certificate of origin that the goods will be invoiced from that non-Party, and indicate the name, business name and address of the operator who will invoice the operation to its destination.
2. The Parties shall establish and implement, through their respective laws and regulations as of the date of entry into force of this Agreement, by agreement between the Parties, Uniform Regulations concerning the interpretation, application and administration of Chapter 3 (National Treatment and Market Access for Goods), Chapter 5 (Customs Administration), this Chapter and such other matters as they may agree.
Section C. Definitions
Article 4.21. Definitions
For the purposes of this Chapter:
issued means prepared by and, where required by domestic laws and regulations, signed by the importer, exporter or producer of the goods;
exporter means a person who exports goods from the territory of a Party;
commercial importation means the importation of a good into the territory of a Party for sale or for commercial, industrial or other similar purposes;
importer means a person who imports goods into the territory of a Party;
material means a good used in the production of another good, including a part, ingredient or indirect material;
self-produced material means an originating material, which is made by a producer of a good and used in the manufacture of that good;
packaging materials and shipping containers means goods used to protect goods during transport, other than containers or packaging material used for retail sale;
indirect material means a good used in the production, testing or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or in the operation of equipment associated with the production of a good, including:
(a) fuel and energy;
(b) tools, dies and moulds;
(c) spare parts and materials used in the maintenance of equipment and buildings;
(d) lubricants, greases, composites and other materials used in production or used to operate equipment and buildings;
(e) gloves, goggles, footwear, clothing, safety equipment and supplies;
(f) equipment, devices and supplies used to test or inspect goods;
(g) catalysts and solvents; and
(h) any other goods which are not incorporated into the goods but which are shown to be used in the making of the goods as part of the making of the goods;
goods means any commodity, product, article or material;
non-originating good or non-originating material means a good or material that does not qualify as an originating good or material under this Chapter;
fungible goods or materials means goods or materials that are interchangeable for commercial purposes and whose characteristics are essentially identical;
recovered goods means materials in the form of individual parts that are the result:
(a) the complete disassembly of used goods, in their individual parts; and
(b) from the cleaning, inspection, testing, or other processing of such parts, to the extent necessary for the achievement of good working condition, one or more of the following processes: welding, heat spraying, surface machining, knurling, plating, sleeving, and rewinding for the purpose of assembly of such parts with other parts, including other parts recovered in the production of a remanufactured good of Annex 4.21 (Remanufactured Goods);
goods wholly obtained or produced entirely within the territory of one or both Parties means:
(a) mineral commodities extracted in the territory of one or both Parties;
(b) plant goods, as defined in the Harmonised System (HS), 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, trapping or fishing in the territory of one or both Parties;
(e) goods taken from the sea (fish, shellfish and other marine life) by vessels registered or recorded in a Party and flying its flag;
(f) goods made on board factory ships based on the goods referred to in subparagraph (e), provided that such factory ships are registered or recorded in that Party and flying its flag;
(g) goods extracted 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;
(h) goods obtained from outer space, provided that they are obtained by a Party or person of a Party and are not processed in the territory of a non-Party;
(i) waste and scrap derived from:
(i) production in the territory of one or both Parties, or
(ii) used goods collected in the territory of one or both Parties, provided that such goods are used only for the recovery of raw materials;
(j) recovered goods obtained in the territory of a Party from used goods and used in the territory of that Party in the processing of remanufactured goods; and
(k) goods produced in the territory of one or both Parties exclusively from the goods referred to in subparagraphs (a) through (i), or derivatives thereof, at any stage of production;
remanufactured goods means certain industrial goods, assembled in the territory of a Party, designated in Annex 4.21 (Remanufactured Goods) that:
(a) are wholly or partly composed of materials corresponding to recovered goods;
(b) have the same life expectancy and meet the same performance standards as new goods; and
(c) have the same factory warranty as new goods;
Generally Accepted Accounting Principles means the principles, rules and procedures, including broad and specific guidelines, that define accepted accounting practices in the territory of a Party;
procedure to verify origin means the administrative process that begins with the notification of initiation of the verification procedure by the competent authority of a Party and concludes with the final determination of origin;
production means the cultivation, extraction, harvesting, fishing, breeding, catching, hunting, manufacturing, processing, assembling or disassembling of a commodity;
producer means a person engaged in the production of a good in the territory of a Party; location of the producer means the place of production of a good;
value means the value of a good or material for the purpose of calculating customs duties or for the purpose of applying this Chapter; and
adjusted value means the value determined in accordance with Articles 1 to 8 and 15 of the Customs Valuation Agreement and its interpretative notes, adjusted, where necessary, to exclude all costs, charges or expenses incurred for transportation, insurance and related services incidental to the international shipment of goods from the country of exportation to the place of importation.
Chapter 5. CUSTOMS ADMINISTRATION
Article 5.1. Publication
1. The customs authority of each Party shall, in accordance with the provisions of its national legislation, publish its customs laws, regulations and procedures of general application on the Internet or an equivalent computer telecommunications network.
2. The customs authority of each Party shall designate one or more contact points to whom enquiries relating to customs matters may be addressed and shall make available on the Internet or an equivalent computer telecommunications network information on the procedures for making such enquiries.
3. To the extent practicable, each Party's customs authority shall publish, in advance, the customs regulations of general application that it proposes to adopt, in order to provide interested persons with an opportunity to comment prior to their adoption.
Article 5.2. Release of Goods
1. The customs authority of each Party shall establish and/or maintain simplified customs procedures for the release of goods in order to facilitate trade between the Parties.
2. Specifically, they shall adopt procedures that, as far as possible, allow for the release of the goods:
(a) within 48 hours of arrival;
(b) at the point of arrival, without temporary transfer to a bonded warehouse or other facilities; and
(c) prior to the presentation of the goods to customs and without prejudice to the final assessment of the applicable customs duties, taxes and other charges.
Article 5.3. Use of Information Technology
The customs authority of each Party shall endeavour to use information technology to expedite its procedures. When installing computer applications, it shall take into account international norms or standards.
Article 5.4. Risk Assessment
Each Party shall endeavour to implement risk management systems in its verification activities, while respecting the confidential nature of information in accordance with its legislation, in order to concentrate customs control activities on high-risk goods and to simplify the clearance and movement of low-risk goods.
Article 5.5. Customs Cooperation
1. Each Party shall endeavour to give prior notice to the other Party of any significant modification with respect to its administrative policy relating to the implementation of its customs legislation that is likely to significantly affect the operation of this Agreement.
2. Each Party shall promote and facilitate cooperation between their respective customs authorities and, in particular, shall ensure the simplification of customs processing and procedures without prejudice to their powers of control.
3. Cooperation shall include, inter alia, aspects relating to:
(a) the implementation and operation of the Free Trade Agreement, in particular the provisions on market access, rules of origin, the origin-related customs procedures of the Agreement and those of this Chapter;
(b) the implementation and application of the Customs Valuation Agreement;
(c) the simplification of requirements and formalities with regard to the release of ip goods;
(d) the adoption, where possible, of measures to reduce, simplify and harmonise the data contained in the documents required by customs, in particular customs documents on the entry and exit of goods;
(e) the provision of technical assistance, including where appropriate, the organisation of seminars and internships;
(f) technical advice and assistance to improve risk assessment techniques, in particular in the search for mechanisms to detect and prevent the illicit shipment of goods originating from a Party or non-Party;
(g) increase the use of technologies that could lead to greater compliance with applicable import laws and regulations;
(h) exchange of information that may assist in determining whether imports or exports from or exports to the other Party are in compliance with its applicable import laws and regulations, in particular those related to the prevention of illicit activities, to the extent permitted under the domestic law of each Party;
(i) import or export restrictions and prohibitions; and
(j) any other customs matters agreed by the Parties.
4. Without prejudice to other customs cooperation agreements in force, the Parties, through their customs authorities, may conclude agreements on mutual administrative assistance in customs matters, with a view to developing further the matters referred to in this Article or other matters within their competence.
Article 5.6. Confidentiality
1. Each Party shall, in accordance with its law, maintain the confidentiality of information of this nature obtained under this Chapter and Chapter 4 (Rules of Origin and Origin Procedures) and shall protect such information from disclosure that would:
(a) be contrary to the public interest as determined in its laws and regulations;
(b) be contrary to its laws including but not limited to those protecting personal privacy or financial matters and accounts of individual customers or financial institutions;
(c) impede law enforcement; and
(d) prejudice the competitive position of the persons providing it.
2. Confidential information obtained under this Chapter may be disclosed only to judicial authorities and to authorities responsible for the administration and enforcement of rulings on origin and customs matters and to those having jurisdiction over the administration and enforcement of internal taxes and duties applicable to the entry and exit of goods.
Article 5.7. Fast Delivery Shipments
Each Party shall adopt and/or maintain separate and expeditious customs procedures for express shipments, while maintaining adequate customs selection and control, including procedures:
(a) to enable the information necessary for clearance to be presented to and processed by the customs authority prior to the arrival of the consignment;
(b) to enable a shipper to present a single document covering all the goods contained in a consignment carried, where possible by electronic means;
(c) to reduce, to the extent possible, the documentation required for the clearance of expedited shipments; and
(d) which, under normal circumstances, enable a consignment to be cleared within a period not exceeding 6 hours from the presentation of the information necessary for clearance.
Article 5.8. Review and Challenge
Each Party shall ensure that with respect to determinations on customs matters importers in its territory have access to:
(a) a level of administrative review independent of the official or office issuing the determination subject to review; and
(b) a judicial review of the administrative determination made in the final administrative review instance.
Article 5.9. Penalties
1. Each Party shall adopt or maintain measures that permit the imposition of civil, administrative and, where appropriate, criminal penalties for violations of its customs laws and regulations, including those governing tariff classification, customs valuation, rules of origin, and requirements for securing preferential tariff treatment in accordance with this Agreement.
2. Each Party shall provide that a false certification or declaration of origin made by its exporter or producer that a good to be exported to the territory of the other Party qualifies as originating shall have the same legal consequences, with such modifications as circumstances may require, as those that would apply to its importer making false declarations or representations in contravention of its customs laws and regulations.
Article 5.10. Advance Rulings
1. Each Party, through its customs authority, shall issue written advance rulings prior to the importation of a good into its territory, upon written request of the importer in its territory, or the exporter or producer in the territory of the other Party, on the basis of the facts and circumstances provided by the applicant, regarding
(a) tariff classification;
(b) whether a good qualifies as an originating good under Chapter 4 (Rules of Origin and Origin Procedures); and
(c) whether a good qualifies for duty-free treatment under Article 3.6 (Goods re- imported after having been repaired or altered).
2. Each Party shall provide that its customs authority shall issue the advance ruling within 150 days of the request, provided that the applicant has submitted all the necessary information.
3. Each Party shall provide that advance rulings shall take effect from their date of issuance, or from a different date specified in the ruling, for up to 3 years, provided that there has been no change in the facts or circumstances on which the ruling was based.
4. The Party that issued an advance ruling may modify or revoke it whenever the facts or circumstances so warrant, such as in cases where the information on which the ruling is based is false or incorrect. The applicant shall be notified of any such modification or revocation.
5. Where an importer requests that the treatment accorded to an imported good should be governed by an advance ruling, the customs authority may assess whether the facts or circumstances of importation are consistent with the facts or circumstances on which the advance ruling was based.
6. Each Party shall make its advance rulings publicly available, subject to the confidentiality conditions of its domestic law, in order to promote the consistent application of advance rulings to other goods.
7. If the requester provides false information or omits relevant facts or circumstances in its request for an advance ruling, or fails to act in accordance with the terms and conditions of the ruling, the importing Party may apply appropriate measures, including civil, criminal, and administrative actions, fines, or other sanctions.
Article 5.11. Re-export Certificate
1, For the purposes of the provisions of the various trade agreements and free trade treaties signed by Chile in relation to the transit and transhipment of goods from third countries through Panama, the customs authority of Chile shall accept, among others, as an enabling document in order to certify that the goods have not undergone changes, further processing or any other type of operation, that cause them to lose their origin and thus maintain the preference agreed under the respective agreement or treaty, the certificate for re- export that attests to the deposit and control of the goods in duty free zones, issued and signed by the customs authority of Panama and also countersigned by the administrative authority of the duty free zone.