(b) facilitate information exchange and technical cooperation between the Parties, and enhance mutual understanding of each Party's regulatorysystem;and (c) strengthen cooperation between the Parties in the field of sanitary and phytosanitary measures.
Article 7.2. Affirmation
Except as otherwise provided for in this Chapter, the SPS Agreement shall apply between the Parties and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 7.3. Scope and Definitions
1. This Chapter applies to sanitary and phytosanitary measures which may, directly or indirectly, affect trade between the Parties.
2. The definitions in Annex A of the SPS Agreement shall apply to this Chapter.
Article 7.4. Harmonisation
To harmonise sanitary and phytosanitary measures as broadly as possible, the Parties shall base their sanitary and phytosanitary measures on international standards, guidelines and recommendations established by the Codex Alimentarius Commission (CAC), the World Organisation for Animal Health (OIE), and the relevant international regional organisations operating within the framework of the International Plant ProtectionConvention(IPPC) where they exist or their completion is imminent.
Article 7.5. Adaptation to Regional Conditions
1. The Parties agree that issues related to the adaptation of zones with different sanitary and phytosanitary status and that affect or may affect trade between them shall be addressed in accordance with Article 6 of the SPS Agreement.
2. The Parties take note of the Guidelines to further the Practical Implementation of Article 6 of the Agreement on the Application of Sanitary and Phytosanitary Measures (G/SPS/48) adopted by the WTO Committee on Sanitary and Phytosanitary Measures and of relevant standards developed by OIE and IPPC.
3. In case of an event affecting the sanitary or phytosanitary status of a pestfree or diseasefree area or an area of low pest or disease prevalence, the Parties shall do their utmost for reestablishing such status based on risk assessments taking into account relevant international standards, guidelines and recommendations.
Article 7.6. Inspection and Certification Systems
1. The Parties agree to further enhance their cooperation in the field of assessment of inspection and certification systems. The importing Party shall take into account the CodexAlimentarius Committee on Food Import and Export Inspection and Certification Systems standards and guidelines.
2. The assessment tools shall as a rule be audits of all or part of an exporting Party's official inspection and certification system, including the ability of the competent authority to enforce and take action based on adequate legislation. These audits may also encompass inspections of a representative percentage of the facilities seeking access to the export market.
3. The need to perform on-site inspections shall be justified.
4. Mutually agreed corrective actions, timeframes and follow-up verification procedures shall be clearly established and documented in the assessment report.
Article 7.7. Technical Cooperation
1. With a view to increasing mutual understanding of the respective regulatory systems, enhancing capacity building and facilitating bilateral trade in agricultural products and food, and improving their sanitary and phytosanitary systems, the Parties shall strengthen technical cooperation in the field of sanitary and phytosanitary measures.
2. The Parties have concluded a side agreement pursuant to Article 7.11 to further this Article.
Article 7.8. Measures at the Border
Where a Party detains, at a port of entry, goods exported from the other Party due to a perceived failure to comply with sanitary or phytosanitary requirements, the reasons for the detention shall be promptly notified to the importer or his or her representative.
Article 7.9. Sub-Committee on Sanitary and Phytosanitary Measures
1. A Sub-Committee on sanitary and phytosanitary measures (hereinafter referred to as the “SPS Sub-Committee”) is hereby established under the Joint Committee.
2. The functions of the SPS SubCommittee shall be:
(a) monitoring the implementation of this Chapter;
(b) coordinating technical cooperation activities;
(c) facilitating technical consultations pursuant to Article 7.10;
(d) identifying areas for enhanced cooperation, including giving favourable consideration to any specific proposal made by either Party;
(e) establishing a dialogue between competent authorities in accordance with the objectives of this Chapter;
(f) initiating side agreements where appropriate pursuant to Article 7.11;
(g) coordinating the implementation of side agreements pursuant to Article 7.11;
(h) consulting on any issue prior to meetings of relevant international organisations, if appropriate;
(i) carrying out other functions mutually agreed by the Parties; and
(j) carrying out other tasks assigned to it by the Joint Committee.
3. The SPS Sub-Committee shall be cochaired and meet once a year, unless otherwise agreed by the Parties. The SPS Sub-Committee meetings may be conducted by any agreed method on a case by case basis and may be combined with those of the TBT SubCommittee established under Article 6.7.
4. The SPS Sub-Committee shall keep up to date a work programme and keep track of its activities.
5. The SPS Sub-Committee may establish ad hoc working groups to accomplish specific tasks.
6. The SPS Sub-Committee shall report on its work to the Joint Committee.
7. The contact points as referred to in Article 7.12 shall be responsible for setting the agenda and organising the meetings. The SPS Sub-Committee shall include representatives of the authorities of each Party with expertise in the areas to be discussed.
8. Upon mutual agreement, the Parties may invite representatives from industry, business associations or other relevant organisations to participate in parts of the meetings of the SPS Sub-Committee on a case by case basis.
Article 7.10. Technical Consultations
Technical consultations under the auspices of the SPS SubCommittee shall be held at the written request of the Party, which considers that the other Party has taken a measure which is likely to create, or has created, an unnecessary obstacle to trade. Such consultations shall take place within60 days, or within20 days in case of urgent matters, from the request with the objective of finding mutually acceptable solutions. Such consultations may be conducted by any agreed method on a case by case basis. (7)
Article 7.11. Side Agreements
Pursuant to and in conjunction with this Agreement, the Parties have concluded a side agreement to implement this Chapter. The Parties may conclude further side agreements in the future.
Article 7.12. Contact Points
1. The Parties shall exchange names and addresses of contact points for matters related to this Chapter in order to facilitate communication and the exchange of information.
2. The Parties shall notify each other of any significant changes in the structures and responsibilities of the authorities acting as contact points.
Chapter 8. Trade In Services
Article 8.1. Scope and Coverage (8)
1. This Chapter applies to measures by Parties affecting trade in services and taken by central, regional or local governments and authorities as well as by non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities.
2. In respect of air transport services, this Chapter shall not apply to measures affecting air traffic rights or measures affecting services directly related to the exercise of air traffic rights, except as provided for in paragraph 3 of the Annex on Air Transport Services of the GATS. The definitions of paragraph 6 of the Annex on Air Transport Services of the GATS shall apply and are hereby incorporated and made part of this Agreement, mutatis mutandis.
3. Articles 8.3, 8.4 and 8.5 shall not apply to laws, regulations or requirements governing the procurement by governmental agencies of services purchased for governmental purposes and not with a view to commercial resale or with a view to use in the supply of services for commercial sale.
Article 8.2. Definitions
For the purpose of this Chapter:
(a) “trade in services” is defined as the supply of a service: (9)
(i) from the territory of one Party into the territory of the other Party;
(ii) in the territory of one Party to the service consumer of the other Party;
(iii) by a service supplier of one Party, through commercial presence in the territory of the other Party;
(iv) by a service supplier of one Party, through presence of natural persons of a Party in the territory of the other Party;
(b) “services” includes any services in any sector except services supplied in the exercise of governmental authority;
(c) “a service supplied in the exercise of governmental authority” means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers;
(d) “measure” means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;
(e) “supply of a service” includes the production, distribution, marketing, sale and delivery of a service;
(f) “measures by Parties affecting trade in services” include measures in respect of:
(i) the purchase, payment or use of a service;
(ii) the access to and use of, in connection with the supply of a service, services which are required by the Parties to be offered to the public generally;
(iii) the presence, including commercial presence, of persons of a Party for the supply of a service in the territory of the other Party;
(g) “commercial presence” means any type of business or professional establishment, including through:
(i) the constitution, acquisition or maintenance of a juridical person; or
(ii) the creation or maintenance of a branch or a representative office;
within the territory of a Party for the purpose of supplying a service;
(h) “sector” of a service means:
(i) with reference to a specific commitment, one or more, or all, sub-sectors of that service, as specified in a Party’s Schedule;
(ii) otherwise, the whole of that service sector, including all of its sub-sectors;
(i) “service of the other Party” means a service which is supplied:
(i) from or in the territory of that other Party, or in case of maritime transport, by a vessel registered under the laws of that other Party, or by a person of that other Party which supplies the service through the operation of a vessel and/or its use in whole or in a part; or
(ii) in the case of the supply of a service through commercial presence or through the presence of natural persons, by a service supplier of that other Party;
(j) “service supplier” means any person that supplies a service; (10)
(k) “monopoly supplier of a service” means any person, public or private, which in the relevant market of the territory of a Party is authorised or established formally or in effect by that Party as the sole supplier of that service;
(l) “service consumer” means any person that receives or uses a service;
(m) “person” means either a natural person or a juridical person;
(n) “natural person of a Party” means:
(i) with respect to China, a natural person who resides in the territory of either Party, and who under Chinese law is a national of China;
(ii) with respect to Switzerland, a natural person who resides in the territory of either Party, and who under Swiss law is:
(A) a national of Switzerland; or
(B) a permanent resident of Switzerland;
(o) “juridical person” means any legal entity duly constituted or otherwise organised under applicable law, whether for profit or otherwise, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, joint venture, sole proprietorship or association;
(p) “juridical person of the other Party” means a juridical person which is either: (11)
(i) constituted or otherwise organised under the law of the other Party, and is engaged in substantive business operations in the territory of the other Party; or
(ii) in the case of the supply of a service through commercial presence, owned or controlled by:
(A) natural persons of the other Party; or
(B) juridical persons of the other Party identified under subparagraph (i);
(q) a juridical person is:
(i) “owned” by persons of a Party if more than 50 per cent of the equity interest in it is beneficially owned by persons of that Party;
(ii) “controlled” by persons of a Party if such persons have the power to name a majority of its directors or otherwise to legally direct its actions;
(iii) “affiliated” with another person when it controls, or is controlled by, that other person; or when it and the other person are both controlled by the same person; and
(r) “direct taxes” comprise all taxes on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.
Article 8.3. Most-favoured-nation Treatment
1. Without prejudice to measures taken in accordance with Article VII of the GATS, and except as provided for in its List of MFN Exemptions contained in Annex VIII, each Party shall accord immediately and unconditionally, in respect of all measures affecting the supply of services, to services and service suppliers of the other Party treatment no less favourable than the treatment it accords to like services and service suppliers of any nonparty.
2. Treatment granted under other existing or future agreements concluded by a Party and notified under Article V or Article V bis of the GATS shall not be subject to paragraph 1.
3. If a Party concludes or amends an agreement of the type referred to in paragraph 2, it shall, upon request from the other Party, endeavour to accord to the other Party treatment no less favourable than that provided under that agreement. The former Party shall, upon request from the other Party, afford adequate opportunity to the other Party to negotiate the incorporation into this Agreement of a treatment no less favourable than that provided under the former agreement.
4. The provisionsofthisChapter shall not be so construed as to prevent the Parties from conferring or according advantages to adjacent countries in order to facilitate exchanges limited to contiguous frontier zones of services that are both locally produced and consumed.
Article 8.4. Market Access
1. With respect to market access through the modes of supply identified in subparagraph (a) of Article 8.2, each Party shall accord services and service suppliers of the other Party treatment no less favourable than that provided for under the terms, limitations and conditions agreed and specified in its Schedule referred to in Article 8.17. (12)
2. In sectors where market access commitments are undertaken, the measures which a Party shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire territory, unless otherwise specified in its Schedule, are defined as:
(a) limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;
(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(c) limitations on the total number of service operations or the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test; (13)
(d) limitations on 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;
(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and
(f) limitations on the participation of foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of individual or aggregate foreign investment.
Article 8.5. National Treatment
1. In the sectors inscribed in its Schedule, and subject to any conditions and qualifications set out therein, each Party shall accord to services and service suppliers of the other Party, in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers.(14)
2. APartymaymeetthe requirementofparagraph1 by according to services and service suppliers of the other Party, either formally identical treatment or formally different treatment to that it accords to its own like services and service suppliers.
3. Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of competition in favour of services or service suppliers of the Party compared to like services or service suppliers of the other Party.
Article 8.6. Additional Commitments
Parties may negotiate commitments with respect to measures affecting trade in services not subject to scheduling under Articles 8.4 or 8.5, including those regarding qualifications, standards or licensing matters. Such commitments are inscribed in a Party's Schedule as additional commitments.
Article 8.7. Domestic Regulation
1. In sectors where specific commitments are undertaken, each Party shall ensure that all measures of general application affecting trade in services are administered in a reasonable, objective and impartial manner.
2. Each Party shall maintain or institute as soon as practicable judicial, arbitral or administrative tribunals or procedures which provide, at the request of an affected service supplier of the other Party, for the prompt review of, and where justified, appropriate remedies for, administrative decisions affecting trade in services. Where such procedures are not independent of the agency entrusted with the administrative decision concerned, the Party shall ensure that the procedures in fact provide for an objective and impartial review.
3. EachPartyshallaimto ensure that measures relating to qualification requirements and procedures, technical standards, and licensing requirements and procedures are based on objective and transparent criteria, such as competence and the ability to supply the service, and are not more burdensome than necessary to ensure the quality of the service. Each Party shall ensure that licensing procedures are not in themselves a restriction on the supply of the service.
4. In determining whether a Party is in conformity with the obligation under paragraph 3, account shall be taken of international standards of relevant international organisations (15) applied by that Party.
5. In sectors where specific commitments regarding professional services are undertaken, each Party shall provide for adequate procedures to verify the competence of professionals of the other Party.
Article 8.8. Recognition
1. For the purpose of the fulfilment of its relevant standards or criteria for the authorisation, licensing or certification of service suppliers, each Party shall give due consideration to any requests by the other Party to recognise the education or experience obtained, requirements met, or licences or certifications granted in that other Party. Such recognition may be based upon an agreement or arrangement with that other Party, or otherwise be accorded autonomously.
2. Where a Party recognises, by agreement or arrangement, the education or experience obtained, requirements met, or licences or certifications granted, in the territory of a non-party, that Party shall afford the other Party adequate opportunity to negotiate its accession to such an agreement or arrangement, whether existing or future, or to negotiate a comparable agreement or arrangement with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for the other Party to demonstrate that the education or experience obtained, requirements met, or licences or certifications granted, in the territory of that other Party should also be recognised.
3. Any such agreement or arrangement or autonomous recognition shall be in conformity with the relevant provisions of the WTO Agreement, in particular paragraph 3 of Article VII of the GATS.
Article 8.9. Transparency
1. Each Party shall publish promptly and, except in emergency situations, at the latest by the time of their entry into force, all relevant measures of general application which pertain to or affect the operation of this Chapter. International agreements pertaining to or affecting trade in services to which a Party is a signatory shall also be published.
2. Where publication, as referred to in paragraph 1, is not practicable, such information shall be made otherwise publicly available.
3. Nothing in this Chapter shall require either Party to provide confidential information, the disclosure of which would impede law enforcement, or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests of particular enterprises, public or private.
Article 8.10. Monopolies and Exclusive Service Suppliers
1. Each Party shall ensure that any monopoly supplier of a service in its territory does not, in the supply of the monopoly service in the relevant market, act in a manner inconsistent with that Party’s obligations under Article 8.3 and specific commitments.
2. Where a Party’s monopoly supplier competes, either directly or through an affiliated company, in the supply of a service outside the scope of its monopoly rights and which is subject to that Party’s specific commitments, the Party shall ensure that such a supplier does not abuse its monopoly position to act in its territory in a manner inconsistent with such commitments.
3. The provisions of this Article shall also apply to cases of exclusive service suppliers, where a Party, formally or in effect:
(a) authorises or establishes a small number of service suppliers; and
(b) substantially prevents competition among those suppliers in its territory.
Article 8.11. Business Practices
1. The Parties recognise that certain business practices of service suppliers, other than those falling under Article 8.10, may restrain competition and thereby restrict trade in services.
2. Each Party shall, at the request of the other Party, enter into consultations with a view to eliminating practices referred to in paragraph 1. The Party addressed shall accord full an sympathetic consideration to such a request and shall cooperate through the supply of publicly available nonconfidential information of relevance to the matter in question. The Party addressed shall also provide other information available to the requesting Party, subject to its domestic law and to the conclusion of satisfactory agreement concerning the safeguarding of its confidentiality by the requesting Party