A Party shall not adopt or maintain, either on the basis of a regional subdivision or on the basis of its entire territory, measures that:
(a) limit the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirement of an economic needs test;
(b) limit the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(c) limit the total number of service operations or the total quantity of services output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test ;
(d) limit the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test; and
(e) restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service.
Article 7.5. Local Presence
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure, as it existed at the date of the entry into force of this Agreement, with Articles 12.4 (National Treatment), 12.5 (Most-Favoured-Nation Treatment), 12.7 (Performance Requirements) and 12.8 (Senior Management and Board of Directors).
Article 7.6. Non-Conforming Measures
1. Articles 7.3 (National Treatment), 7.4 (Market Access), and 7.5 (Local Presence) do not apply to:
(a) any existing non-conforming measure that is maintained by a Party, as set out by that Party in its Schedule to Annex 7-A;
(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure, as it existed at the date of the entry into force of this Agreement, with Article 7.3 (National Treatment), Article 7.4 (Market Access), and Article 7.5 (Local Presence).
2. Article 7.3 (National Treatment), Article 7.4 (Market Access), and Article 7.5 (Local Presence) do not apply to any measure that a Party adopts or maintains with respect to sectors, sub-sectors or activities as set out in its Schedule to Annex 7-B.
Article 7.7. Domestic Regulation
1. Each Party shall ensure that all measures of general application affecting trade in services are administered in a reasonable, objective and impartial manner.
2. With a view to ensuring that domestic regulation, including measures relating to qualification requirements and procedures, technical standards and licensing requirements, do not constitute unnecessary barriers to trade in services, the Parties shall endeavour to ensure, as appropriate, for individual sectors, that such measures are:
(a) based on objective and transparent criteria, such as competence and the ability to supply the service;
(b) not more burdensome than necessary to ensure the quality of the service; and
(c) in the case of licensing procedures, not in themselves a restriction on the supply of the service.
3. Where authorisation is required for the supply of a service, the competent authorities of a Party shall promptly, after the submission of an application considered complete under domestic laws and regulations, inform the applicant of the decision concerning the application. At the request of the applicant, the competent authorities of the Party shall provide, without undue delay, information concerning the status of the application.
4. If the results of the negotiations related to Article VI:4 of the GATS (or the results of any similar negotiations undertaken in other multilateral fora in which the Parties participate) enter into effect for the Parties, this Article shall be amended, as appropriate, after consultations between the Parties, to bring those results into effect under this Agreement. The Parties agree to coordinate on such negotiations, as appropriate.
Article 7.8. Recognition
1. For the purposes of the fulfilment, in whole or in part, of its standards or criteria for the authorisation, licensing or certification of services suppliers, and subject to the requirements of paragraph 4, a Party may recognise the education or experience obtained, requirements met, or licences or certifications granted in a particular country or customs territory, including the other Party and non-Parties. Such recognition, which may be achieved through harmonisation or otherwise, may be based upon an agreement or arrangement with the country or customs territory concerned or may be accorded autonomously.
2. Where a Party recognises, autonomously or by agreement or arrangement, the education or experience obtained, requirements met or licences or certifications granted in the territory of a non-Party, nothing shall be construed to require the Party to accord such recognition to the education or experience obtained, requirements met or licences or certifications granted in the territory of the other Party.
3. A Party that is a party to an agreement or arrangement of the type referred to in paragraph 1, whether existing or future, shall afford adequate opportunity for the other Party, if the other Party is interested, to negotiate its accession to such an agreement or arrangement or to negotiate comparable ones with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for the other Party to demonstrate that education, experience, licences, or certifications obtained or requirements met in that other Party’s territory should be recognised.
4. A Party shall not accord recognition in a manner which would constitute a means of discrimination between countries or customs territories in the application of its standards or criteria for the authorisation, licensing or certification of services suppliers, or a disguised restriction on trade in services.
Article 7.9. Transfers and Payments
1. Each Party shall permit all transfers and payments relating to the cross-border supply of services to be made freely and without delay into and out of its territory.
2. Each Party shall permit such transfers and payments relating to the cross-border supply of services to be made in a freely usable currency at the market rate of exchange prevailing on the date of transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may prevent or delay a transfer or payment through the equitable, non-discriminatory and good faith application of its laws relating to:
(a) bankruptcy, insolvency or the protection of the rights of creditors;
(b) issuing, trading or dealing in securities, futures, options, or derivatives;
(c) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;
(d) criminal or penal offenses;
(e) ensuring compliance with orders or judgments in judicial or administrative proceedings; or
(f) social security, public retirement or compulsory savings schemes.
4. Nothing in this Chapter shall affect the rights and obligations of the members of the International Monetary Fund under the Articles of Agreement of the International Monetary Fund, including the use of exchange actions which are consistent with such Articles of Agreement, provided that a Party shall not impose restrictions on any capital transactions inconsistently with its obligations under this Chapter regarding such transactions, except under Article 18.6 (Restrictions to Safeguard the Balance-of-Payments) of Chapter 18 (Institutional, General and Final Provisions) or at the request of the International Monetary Fund.
Article 7.10. Denial of Benefits
A Party may deny the benefits of this Chapter to a service supplier of the other Party if the service is being supplied by an enterprise that has no substantive business operations in the territory of the other Party and it is owned or controlled by persons of a non-Party or the denying Party.
Article 7.11. Review of Commitments
1. If, after this Agreement enters into force, a Party enters into any agreement on trade in services with a non-Party, it shall give positive consideration to a request by the other Party for the incorporation herein of treatment no less favourable than that provided under the aforesaid agreement.
2. If, after this Agreement enters into force, a Party further liberalises any of its non-conforming measures in Annex 7-A or sectors, subsectors, or activities in Annex 7-B unilaterally, it shall give positive consideration to a request by the other Party for the incorporation herein of the unilateral liberalisation.
3. Parties shall discuss in the Joint Committee any request made under paragraph 1 or paragraph 2.
4. If, after this Agreement enters into force, a service previously supplied in the exercise of governmental authority is subsequently supplied on a commercial basis or in competition with one or more service suppliers, the Party concerned may modify or add to its reservations in respect of that service. At the request of the other Party, the Party concerned shall enter into consultations with a view to ensuring the maintenance of the overall balance of commitments undertaken by each Party under this Agreement.
Chapter 8. TELECOMMUNICATIONS
Article 8.1. Definitions
For purposes of this Chapter:
“broadcasting” means the transmission of signs or signals via any technology for the reception and/or display of aural and/or visual programme signals by all or part of the public;
“cost-oriented” means based on cost, and may include a reasonable profit, and may involve different cost methodologies for different facilities or services;
“end-user” means a final consumer of or subscriber to a public telecommunications service, including a service supplier other than a supplier of public telecommunications services;
“enterprise” means an entity constituted or organised under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including a corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organisation, and a branch of an enterprise;
“essential facilities” means facilities of a public telecommunications network or service that:
(a) are exclusively or predominantly provided by a single or limited number of suppliers; and
(b) cannot feasibly be economically or technically substituted in order to supply a service;
“interconnection” means linking with suppliers providing public telecommunications services or networks in order to allow the users of one supplier to communicate with users of another supplier and to access services provided by another supplier;
“international mobile roaming service” means a commercial mobile service provided pursuant to a commercial agreement between suppliers of public telecommunications services that enables end-users to use their home mobile handset or other device for voice, data or messaging services while outside the territory in which the end-user’s home public telecommunications network is located;
“leased circuits” means telecommunications facilities between two or more designated points that are set aside for the dedicated use of, or availability to, a user and supplied by a supplier of fixed telecommunications services;
“licence” means any authorisation that a Party may require of a person, in accordance with its laws and regulations, in order for such person to offer a telecommunications service, including concessions, permits, or registrations;
“major supplier” means a supplier of public telecommunications services that has the ability to materially affect the terms of participation (having regard to price and supply) in the relevant market for public telecommunications services as a result of:
(a) control over essential facilities; or
(b) use of its position in the market;
“network element” means a facility or equipment used in supplying a public telecommunications service, including features, functions, and capabilities provided by means of that facility or equipment;
“non-discriminatory” means treatment no less favourable than that accorded to any other user of like public telecommunications services in like circumstances, including with respect to timeliness;
“number portability” means the ability of end-users of public telecommunications services to retain the same telephone numbers when switching between the same category of suppliers of public telecommunications services;
“physical co-location” means physical access to and control over space in order to install, maintain, or repair equipment, at premises owned or controlled and used by a major supplier to provide public telecommunications services;
“public telecommunications network” means telecommunications infrastructure used to provide public telecommunications services between defined network termination points;
“public telecommunications service” means any telecommunications service that a Party requires, explicitly or in effect, to be offered to the public generally. Such services may include, inter alia, telephone and data transmission typically involving customer-supplied information between two or more defined points without any end-to-end change in the form or content of the customer’s information;
“reference interconnection offer” means an interconnection offer extended by a major supplier and filed with, approved by, or determined by a telecommunications regulatory body that sufficiently details the terms, rates, and conditions for interconnection such that a supplier of public telecommunications services that is willing to accept it may obtain interconnection with the major supplier on that basis, without having to engage in negotiations with the major supplier concerned;
“service supplier” means a person of a Party that seeks to supply or supplies a service;
“telecommunications” means the transmission and reception of signals by any electromagnetic means, including by photonic means;
“telecommunications regulatory body” means a body or bodies responsible for the regulation of telecommunications;
“user” means a service consumer or a service supplier; and
“virtual co-location” means an arrangement whereby a requesting supplier seeking co-location may specify equipment to be used in the premises of a major supplier but does not obtain physical access to such premises and allows the major supplier to install, maintain, and repair such equipment.
Article 8.2. Scope and Coverage
1. This Chapter shall apply to measures affecting trade in telecommunications services.
2. This Chapter shall not apply to any measure affecting broadcasting.
3. Nothing in this Chapter shall be construed to require a Party, or require a Party to compel any enterprise, to establish, construct, acquire, lease, operate, or provide telecommunications networks or services not offered to the public generally.
Article 8.3. Access to and Use (6) of Public Telecommunications Services
1. Each Party shall ensure that service suppliers of the other Party have access to and use of any public telecommunications service offered in its territory or across its borders, on reasonable and non-discriminatory terms and conditions.
2. Each Party shall ensure that service suppliers of the other Party are permitted to:
(a) purchase or lease, and attach terminal or other equipment that interfaces with, a public telecommunications network;
(b) provide services to individual or multiple end-users over leased or owned circuits;
(c) connect owned or leased circuits with public telecommunications networks or services, or with circuits leased or owned by another enterprise;
(d) perform switching, signalling, processing, or conversion functions; and
(e) use operating protocols of their choice.
3. Each Party shall ensure that service suppliers of the other Party may use public telecommunications services for the movement of information in its territory or across its borders, including for intra-corporate communications, and for access to information contained in databases or otherwise stored in machine-readable form in the territory of either Party.
4. Notwithstanding paragraph 3, a Party may take such measures as are necessary to ensure the security and confidentiality of messages and protect the privacy of personal data of end-users of public telecommunications networks or services, provided that such measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination or disguised restriction on trade in services.
5. Each Party shall ensure that no condition is imposed on access to and use of public telecommunications networks or services, other than as necessary to:
(a) safeguard the public service responsibilities of suppliers of public telecommunications networks or services, in particular their ability to make their networks or services available to the public generally; or
(b) protect the technical integrity of public telecommunications networks or services.
6. Provided that they satisfy the criteria set out in paragraph 5, conditions for access to and use of public telecommunications networks or services may include:
(a) a requirement to use specified technical interfaces, including interface protocols, for interconnection with such networks or services;
(b) requirements, where necessary, for the inter-operability of such networks or services;
(c) type approval of terminal or other equipment which interfaces with the network and technical requirements relating to the attachment of such equipment to such networks; and
(d) a licensing, permit, registration, or notification procedure which, if adopted or maintained, is transparent and provides for the processing of applications filed thereunder in accordance with the Party’s domestic laws and regulations.
Article 8.4. Competitive Safeguards on Major Suppliers
1. Each Party shall introduce or maintain appropriate measures for the purpose of preventing suppliers of public telecommunications networks or services who, alone or together, are a major supplier from engaging in or continuing anti-competitive practices. Such anti-competitive practices shall include in particular:
(a) engaging in anti-competitive cross-subsidisation, price squeeze or predatory pricing;
(b) using information obtained from competitors with anti-competitive results; and
(c) not making available to other suppliers of public telecommunications networks or services on a timely basis technical information about essential facilities and commercially relevant information which are necessary for them to provide services.
Article 8.5. Interconnection
1. Each Party shall ensure that any service supplier authorised to provide public telecommunications networks or services has the right and obligation to negotiate interconnection with other suppliers of public telecommunications networks or services. Interconnection should be agreed on the basis of commercial negotiations between the parties concerned .(7)
2. The telecommunications regulatory body shall ensure that any supplier authorised to provide public telecommunications networks or services that acquire information from another supplier of public telecommunications networks or services during the process of negotiating interconnection arrangements use that information solely for the purpose for which it was supplied and respect at all times the confidentiality of information transmitted or stored.
Article 8.6. Interconnection with a Major Supplier
1. Each Party shall ensure that any major supplier in its territory provides interconnection for the facilities and equipment of suppliers of public telecommunications networks or services of the other Party at any technically feasible point in the major supplier’s network. Such interconnection shall be provided:
(a) under non-discriminatory terms, conditions (including technical standards and specifications) and rates, and of a quality no less favourable than that provided for its own like services, for like services of non-affiliated service suppliers, or for like services of its subsidiaries or other affiliates;
(b) in a timely fashion, on terms and conditions (including technical standards and specifications) and at cost-oriented rates that are transparent, reasonable, having regard to economic feasibility, and sufficiently unbundled so that the supplier need not pay for network components or facilities that it does not require for the service to be provided; and
(c) upon request, at points in addition to the network termination points offered to the majority of users, subject to charges that reflect the cost of construction of necessary additional facilities.
2. Each Party shall ensure that the procedures applicable for interconnection with a major supplier in its territory are made publicly available.
3. Each Party shall provide a means for suppliers of public telecommunications networks or services of the other Party to obtain the rates, terms, and conditions necessary for interconnection offered by a major supplier. Such means include, at a minimum, ensuring:
(a) the public availability of interconnection agreements in effect between a major supplier in its territory and other suppliers of public telecommunications networks or services in its territory;
(b) the public availability of rates, terms, and conditions for interconnection with a major supplier set by the telecommunications regulatory body; or
(c) the public availability of a reference interconnection offer.
4. Further to paragraphs 2 and 3, each Party shall ensure that a major supplier in its territory provides suppliers of public telecommunications networks or services of the other Party the opportunity to interconnect their facilities and equipment with those of the major supplier through the following options:
(a) a reference interconnection offer or another standard interconnection offer containing the rates, terms, and conditions that the major supplier offers generally to suppliers of public telecommunications networks or services; or
(b) the terms and conditions of an interconnection agreement in effect.
5. In addition to the options provided in paragraph 4, each Party shall ensure that suppliers of public telecommunications networks or services of the other Party have the opportunity to interconnect their facilities and equipment with those of the major supplier through negotiation of a new interconnection agreement.
Article 8.7. Co-Location by Major Suppliers
1. Each Party shall ensure that a major supplier in its territory provides to suppliers of public telecommunications networks or services of the other Party in the Party’s territory physical co-location of equipment necessary for interconnection or access to unbundled network elements on a timely basis and on terms and conditions, and at cost-oriented rates, that are reasonable, non-discriminatory, and based on a generally available offer.
2. Where physical co-location is not practical for technical reasons or because of space limitations, each Party shall ensure that a major supplier in its territory provides an alternative solution such as facilitating virtual co-location on a timely basis and on terms and conditions, and at cost-oriented rates that are reasonable, non-discriminatory, and based on a generally available offer.
3. A Party may determine, in accordance with its laws and regulations, which premises owned or controlled by major suppliers in its territory are subject to paragraphs 1 and 2. When making this determination, the Party shall take into account factors such as the state of competition in the market in which co-location is required, whether such premises can feasibly be economically or technically substituted in order to provide a competing service, or other specified public interest factors.
Article 8.8. Access to Poles, Ducts, Conduits, and Rights-of-way Owned or Controlled by Major Suppliers
1. Each Party shall ensure that a major supplier in its territory provides access to poles, ducts, conduits, and rights-of-way or any other structures as determined by the Party, owned or controlled by the major supplier to suppliers of public telecommunications networks or services of the other Party in the Party’s territory on a timely basis and on terms and conditions, and at rates, that are reasonable, non-discriminatory, and transparent and subject to technical feasibility.
2. A Party may determine, in accordance with its laws and regulations, the poles, ducts, conduits, rights-of-way or any other structures to which it requires major suppliers in its territory to provide access under paragraph 1. When making this determination, the Party shall take into account factors such as the competitive effect of lack of such access, whether such structures can feasibly be economically or technically substituted in order to provide a competing service or other specified public interest factors.
Article 8.9. Licensing Process
1. When a Party requires a supplier of public telecommunications networks or services to have a licence, the Party shall ensure the public availability of:
(a) all the licensing criteria and procedures it applies;
(b) the period it normally requires to reach a decision concerning an application for a licence; and
(c) the terms and conditions of all licences in effect.
2. A Party shall ensure that, on request, an applicant receives the reasons for the:
(a) denial of a licence;
(b) imposition of supplier-specific conditions on a licence;
(c) revocation of a licence; or
(d) refusal to renew a licence.
Article 8.10. Allocation and Use of Scarce Resources
1. Any procedures for the allocation and use of scarce resources, including frequencies, numbers and rights of way, shall be carried out in an objective, timely, transparent and non-discriminatory manner. Number of rights of use of scarce resources shall only be limited in case it is necessary for the resources to be used by limited number of operators and for the purpose of providing efficient use of resources. For telecommunications services to be provided and/or infrastructure and networks to be installed and operated by limited number of operators, the rights of use of scarce resources shall be allocated by mechanisms such as the tendering process.
2. The current state of allocated frequency bands shall be made publicly available, but detailed identification of frequencies allocated for specific government uses is not required.
3. A Party’s measures allocating and assigning spectrum and managing frequencies shall not be considered as inconsistent with Article 7.4 (Market Access) of Chapter 7 (Cross Border Trade in Services) or Article 12.7 (Performance Requirements) of Chapter 12 (Investment). Accordingly, each Party retains the right to establish and apply its spectrum and frequency management policies that may have the effect of limiting the number of suppliers of a public telecommunications network or service, provided it does so in a manner consistent with other provisions of this Agreement. This includes the ability to allocate frequency bands, taking into account present and future needs, and spectrum availability.
Article 8.11. Universal Service
1. Each Party has the right to define the kind of universal service obligations it wishes to maintain.
2. Such obligations shall not be regarded as anti-competitive per se, provided they are administered in a transparent, objective and non-discriminatory way. The administration of such obligations shall also be neutral with respect to competition and not be more burdensome than necessary for the kind of universal service defined by each Party.
3. Where applicable, any fund that has been set up by a Party for the purposes of universal services shall be used in accordance with the relevant legislation of the Party.
Article 8.12. Number Portability
Each Party shall ensure that suppliers of public telecommunications services in its territory provide number portability on reasonable terms and conditions and without impairment to quality and reliability of the service or convenience to the end-users.
Article 8.13. International Submarine Cable Systems
Each Party shall ensure that any major supplier who controls international submarine cable landing stations in the Party’s territory provides access to such landing stations, consistent with the provisions of paragraph 1 of Article 8.6 (Interconnection with a Major Supplier), Article 8.7 (Co-Location by Major Suppliers), and Article 8.8 (Access to Poles, Ducts, Conduits, and Rights-of-way Owned or Controlled by Major Suppliers) to suppliers of public telecommunications networks or services of the other Party.