3. No Party shall have recourse to dispute settlement under Chapter 14 (Dispute Settlement) with respect to the obligations in this Chapter.
Article 5.5. Competent Authorities and Contact Points
1. To facilitate communication on matters covered by this Chapter, each Party shall notify the other Party of its competent authority and contact point within 30 days from the entry into force of this Agreement.
2. Each Party shall inform the other Party of any change in competent authority or in its contact point within a reasonable period of time.
Article 5.6. The Subcommittee for Sanitary and Phytosanitary Measures
1. For the purposes of the effective implementation and operation of this Chapter, the Subcommittee for Sanitary and Phytosanitary (SPS) Measures established in Chapter 17 (Administration of the Agreement) shall be composed of government representatives of each Party responsible for sanitary and phytosanitary matters, and shall be subject to the direction of the Joint Committee.
2. The objectives of the Subcommittee for SPS Measures are to:
(a) monitor the implementation and operation of this Chapter;
(b) consider sanitary and phytosanitary matters of mutual interest; and
(c) enhance communication and cooperation on sanitary and phytosanitary matters.
3. The Subcommittee for SPS Measures is intended to serve as a forum to:
(a) improve the Parties' understanding of sanitary and phytosanitary issues that relate to the implementation of the SPS Agreement and this Chapter;
(b) enhance mutual understanding of each Party's sanitary and phytosanitary measures and the regulatory and operational processes that relate to those measures;
(c) exchange information on the implementation of this Chapter; and
(d) share information on any sanitary or phytosanitary issue that has arisen between them.
4. The Subcommittee for SPS Measures shall establish its terms of reference at its first meeting and may revise those terms as needed, and shall thereafter meet as needed at its own discretion or at the direction of the Joint Committee.
5. If a Party considers that there is a disruption to trade on sanitary and phytosanitary grounds, it may request technical consultations through the Subcommittee for SPS Measures with a view to facilitating trade. On receiving a request under this paragraph, the other Party shall respond to such a request, and shall endeavour to provide any requested information and respond to questions pertaining to the matter, and if requested, enter into consultations within a reasonable period of time after receiving such a request. The Parties shall make every effort to reach a mutually satisfactory resolution through consultations within a period of time agreed upon by the Parties.
Article 5.7. Equivalence
1. The Parties recognize that the principle of equivalence, as provided for under Article 4 of the SPS Agreement, has mutual benefits for both exporting and importing Parties.
2. The Parties shall follow the procedures for determining the equivalence of SPS measures and standards developed by the WTO SPS Committee and relevant international standard setting bodies in accordance with Annex A of the SPS Agreement, mutatis mutandis. The importing Party shall accept the SPS measure of the exporting Party as equivalent, if the other Party objectively demonstrates that its measure achieves the Party's appropriate level of sanitary or phytosanitary protection.
3. Upon request of the exporting Party, the Parties shall enter into discussions with the aim to achieve recognition of the equivalence of specified sanitary or phytosanitary measures within a reasonable period of time in line with the principle of equivalence in the SPS Agreement and other standards, guidelines or recommendations by the relevant international bodies consistent with Annex A of the SPS Agreement.
4. Compliance by an exported product with a technical regulation or standard of the exporting Party that has been accepted as equivalent to SPS measures and standards of the importing Party shall not remove the need for that product to comply with any other relevant mandatory requirements of the importing Party.
Article 5.8. Risk Assessment
1. Parties shall ensure that any SPS measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles, and is not maintained without sufficient scientific evidence.
2. Each Party shall ensure that each risk assessment conducted has to be appropriate to the circumstances of the risk at issue and takes into account reasonably available and relevant scientific data.
3. Notwithstanding paragraph 1, where relevant scientific evidence is insufficient, a Member may provisionally adopt SPS measures on the basis of available pertinent information, including that from relevant international organizations as well as from SPS measures applied by other Members. In such circumstances and upon receipt of the request for approval for importation of a good from the exporting Party, the importing Party shall seek to obtain additional information necessary and taking into account available scientific evidence for a more objective assessment of risk and review the SPS measure within a reasonable period of time.
4. Upon request by the exporting Party, the importing Party shall inform the exporting Party of the progress of a specific risk analysis request.
Article 5.9. Emergency Measures
If a Party adopts an emergency measure that is necessary for the protection of human, animal or plant life or health, the Party shall promptly notify the measure by using the WTO SPS notification submission system as a means of emergency notification. If a Party adopts an emergency measure, it shall review that measure periodically and make available the results of that review to the other Party upon request.
Article 5.10. Transparency
1. The Parties recognize the value of transparency in the adoption and application of SPS measures and the importance of sharing information about such measures on an ongoing basis.
2. In implementing this Article, each Party should take into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.
3. Each Party agrees to notify a proposed SPS measure that may have an effect on the trade of the other Party, including any that conforms to international standards, guidelines or recommendations, by using the WTO SPS notification submission system as a means of notification.
4. Each Party shall provide to the other Party, on request, SPS measures related to the importation of a good into that Party's territory.
Article 5.11. Cooperation
1. The Parties shall explore opportunities for further cooperation, collaboration and information exchange between them on sanitary and phytosanitary matters of mutual interest, consistent with this Chapter. Those opportunities may include trade facilitation initiatives and technical assistance. The Parties shall cooperate to facilitate the implementation of this Chapter.
2. The Parties shall cooperate and may jointly identify work on sanitary and phytosanitary matters with the goal of eliminating unnecessary obstacles to trade between the Parties.
Chapter 6. CUSTOMS PROCEDURES & TRADE FACILITATION
Article 6.1. Definitions
For the Purposes of this Chapter:
Customs laws means provisions implemented by legislation or regulation concerning the importation, exportation, transit of goods, or any other customs procedures, whether relating to customs duties, taxes, or any other charges collected by the Customs Authorities, or to measures for prohibition, restriction, or control enforced by the Customs Authorities;
Customs procedures means the measures applied by the customs authority of a Party to goods and to the means of transport that are subject to its customs laws and regulations;
Customs Mutual Assistance Agreement (CMAA) means the Agreement that further enhances customs cooperation and exchange of information between the Parties to secure and facilitate lawful trade, signed on 24 November 2021;
Authorised economic operator(s) (AEO) means the programme that recognises an operator involved in the international movement of goods in whatever function that has been approved by the national Customs Authority as complying with the World Customs Organization (WCO) or equivalent supply chain security standards; and
Mutual recognition arrangement (MRA) means the arrangement between the Parties that mutually recognises AEO authorisations that have been properly granted by each Party's Customs Authority.
Article 6.2. Scope
This Chapter shall apply, in accordance with the Parties' respective national laws, rules, and regulations, to customs procedures required for clearance of goods traded between the Parties. Each Party shall use its available resources in an appropriate way to implement this Chapter.
Article 6.3. General Provisions
1. The Parties agree that their customs laws, regulations and procedures shall be transparent, non-discriminatory, consistent, and avoid unnecessary procedural obstacles to trade.
2. The Parties affirm their rights and obligations under the Trade Facilitation Agreement.
3. The Parties shall conform when possible to international tools, instruments, and standards applicable in the area of customs and trade, which include:
(a) the International Convention on the Simplification and Harmonization of Customs Procedures, done at Kyoto, Japan on 18 May 1973, as amended by the Protocol of Amendment to the International Convention on the Simplification and Harmonization of Customs Procedures of 18 May 1973, done at Brussels, Belgium on 26 June 1999;
(b) the International Convention on the Harmonized Commodity Description and Coding System, done at Brussels, Belgium on 14 June 1983, as amended by the Protocol of Amendment to the International Convention on the Harmonized Commodity Description and Coding System on 24 June 1986;
(c) the WCO Framework of Standards to Secure and Facilitate Trade (SAFE Framework of Standards); and
(d) the WCO Data Model.
4. The Customs Authority of each Party shall periodically review its customs procedures with a view to their further simplification and development to facilitate bilateral trade.
Article 6.4. Publication and Availability of Information
1. Each Party shall ensure that its laws, regulations, guidelines, procedures, and administrative rulings governing customs matters are published as early as possible before application, either on the Internet or in print form.
2. Each Party shall designate, establish, and maintain one or more enquiry points to address enquiries from interested persons pertaining to customs matters and shall endeavour to make available publicly through electronic means information concerning procedures for making such enquiries.
3. Nothing in this Article or in any part of this Agreement shall require any Party to publish law enforcement procedures and internal operational guidelines, including those related to conducting risk analyses and targeting methodologies.
4. Each Party shall, to the extent practicable, and in a manner consistent with its domestic laws and legal system, ensure that new or amended laws and regulations of general application related to the movement, release, and clearance of goods, including goods in transit, are published, or information on them is made otherwise publicly available as early as possible before their entry into force, so that interested parties have the opportunity to become acquainted with the new or amended laws and regulations.
Article 6.5. Risk Management
1. Each Party shall adopt a risk management approach in its customs activities, based on its identified risk of goods, in order to facilitate the clearance of low-risk consignments while focusing its inspection activities on high-risk goods.
2. Neither Party shall apply risk management in a manner that may lead to arbitrary or unjustifiable discrimination or disguised restrictions to international trade.
Article 6.6. Paperless Communications
1. For the purposes of facilitating the bilateral exchange of international trade data and expediting procedures for the release of goods, the Parties shall endeavour to provide an electronic environment that supports business transactions between their respective Customs Authorities and trading entities.
2. The Parties shall exchange views and information on realising and promoting paperless communications between their respective Customs Authorities and trading entities.
3. The Parties' respective Customs Authorities, in implementing initiatives that provide for the use of paperless communications, shall take into account the methodologies agreed at the WCO, as well as those stated in the CMAA.
Article 6.7. Advance Rulings
1. In accordance with its commitments under the Trade Facilitation Agreement, each Party shall provide for the issuance of an advance ruling, prior to the importation of the goods into its territory, to an importer of the goods into its territory or to an exporter or producer of the goods in the territory of another Party.
2. For the purposes of paragraph 1, each Party shall issue rulings as to whether the good qualifies as an originating goods or to assess the tariff classification of goods. In addition, each Party may issue rulings that cover additional trade matters as specified in the Trade Facilitation Agreement. Each Party shall issue its determination regarding the origin or tariff classification of the goods in a reasonable and, time-bound manner from the date of receipt of a complete application for an advance ruling.
3. The importing Party shall apply an advance ruling issued by it under paragraph 1 on the date that the ruling is issued or on a later date specified in the ruling. It shall remain in effect for a reasonable period of time and in accordance with the national procedures on advanced rulings, unless the advance ruling is modified or revoked.
4. The advance ruling issued by the Party shall be binding only on the applicant to whom the ruling is issued.
5. A Party may decline to issue an advance ruling if the facts and circumstances forming the basis of the advance ruling are the subject of a post-clearance audit or an administrative, judicial, or quasi-judicial review or appeal. A Party that declines to issue an advance ruling shall promptly notify in writing the person requesting the ruling, setting out the relevant facts and circumstances and the basis for its decision.
6. The importing Party may modify or revoke an advance ruling:
(a) if the ruling was based on an error of fact;
(b) if there is a change in the material facts or circumstances on which the ruling was based;
(c) to conform with a modification of this Chapter; or
(d) to conform with a judicial decision or a change in its domestic law.
7. Each Party shall provide written notice to the applicant explaining the Party's decision to revoke or modify the advance ruling issued to the applicant.
8. Each Party shall provide that any modification or revocation of an advance ruling shall be effective on the date on which the modification or revocation is issued, or on such later date as may be specified therein, and shall not be applied to importations of the goods that have occurred prior to that date, unless the person to whom the advance ruling was issued has not acted in accordance with its terms and conditions.
9. Notwithstanding paragraph 8, the issuing Party shall postpone the effective date of the modification or revocation of an advance ruling for a reasonable period of time and in accordance with each Party's national procedures on advance rulings, where the person to whom the advance ruling was issued demonstrates that he has relied in good faith to his detriment on that ruling.
10. Each Party shall publish online, at least:
(a) the requirements for an application for an advance ruling, including the information to be provided and the format;
(b) the time period by which it will issue an advance ruling; and
(c) the length of time for which the advance ruling is valid.
Article 6.8. Penalties
1. Each Party shall maintain measures imposing criminal, civil, or administrative penalties, whether solely or in combination, for violations of the Party's customs laws and regulations.
2. Each Party shall ensure that penalties issued for a breach of its customs laws and regulations are imposed only on the person(s) responsible for the breach under its laws.
3. Each Party shall ensure that the penalty imposed by its Customs Authority is dependent on the facts and circumstances of the case and is commensurate with the degree and severity of the breach.
4. Each Party shall ensure that it maintains measures to avoid conflicts of interest in the assessment and collection of penalties and duties. No portion of the remuneration of a government official shall be calculated as a fixed portion or percentage of any penalties or duties assessed or collected.
5. Each Party shall ensure that if a penalty is imposed by its Customs Administration for a breach of its customs laws or regulations, an explanation in writing is provided to the person(s) on whom the penalty is imposed specifying the nature of the breach and the applicable laws, regulations, or procedural requirements under which the amount or range of penalty for the breach has been issued.
Article 6.9. Release of Goods
1. Each Party shall adopt or maintain simplified customs procedures for the efficient release of goods in order to facilitate trade.
2. Pursuant to paragraph 1, each Party shall adopt or maintain procedures that:
(a) provide for the immediate release of goods upon receipt of the customs declaration and fulfilment of all applicable requirements and procedures;
(b) provide for the electronic submission and processing of documentation, including manifests, and data, and to the extent possible prior to the arrival of the goods in order to expedite the release of goods from customs control upon arrival;
(c) allow goods to be released at the point of arrival without requiring temporary transfer to warehouses or other facilities, taking into account the required procedures for controlled or regulated goods in accordance with the national laws and regulations; and
(d) require that the importer to be informed if a Party does not promptly release goods, including, to the extent permitted by its law, the reasons why the goods are not released and which border agency, if not the Customs Authority, has withheld release of the goods.
3. Nothing in this Article requires a Party to release goods if its requirements for release have not been met, nor does it prevent a Party from liquidating a security deposit in accordance with its law.
4. Each Party may allow, to the extent practicable and in accordance with its customs laws, goods intended for import to be moved within its territory under customs control from the point of entry into the Party's territory to another customs office in its territory from where the goods are intended to be released, provided the applicable regulatory requirements are met.
Article 6.10. Transit and Transhipment
Each Party Shall, In Accordance with Its National Laws and Regulations:
(a) conduct transit and transhipment operations between the Parties in a facilitated and effectively controlled manner;
(b) ensure the facilitation and effective control of transhipment operations and transit movements through its territory;
(c) endeavour to promote and implement international transit arrangements, with a view to facilitating trade; and
(d) ensure cooperation and coordination between all concerned authorities and agencies in their respective territories to facilitate the traffic of goods in transit and in accordance with Article 6.11 (Temporary Admission).
Article 6.11. Temporary Admission
1. Each Party shall grant temporary admission, conditionally relieved from custom duties and taxes in accordance with the national laws and regulations of each Party, to the following goods imported from the other Party:
(a) goods intended for display or demonstration at exhibitions, fairs, meetings, or similar events including, but not necessarily limited to, commercial samples, advertising materials including printed materials, films, and recordings;
(b) professional and scientific equipment and materials, including their spare parts, that are necessary for carrying out the business activity, trade, or profession of a person who qualifies for temporary entry pursuant to the laws of the importing Party;
(c) containers, pallets, packings, samples, and other goods imported in connection with a commercial operation;
(d) goods imported in connection with a manufacturing operation;
(e) machinery and equipment for the completion of projects or for conducting the experiments and tests relating to such projects, or for repair;
(f) goods imported for educational, scientific, cultural, or sports purposes;
(g) tourist publicity materials; and
(h) goods imported for humanitarian purposes.
2. Each Party shall, at the request of the importer and for reasons deemed valid by its Customs Authority, extend the time limit for temporary admission beyond the period initially fixed.
3. Nothing in this Article shall affect the Parties' rights to require a guarantee equal of import duties and taxes on temporary admission with total conditional relief.
4. If any condition that a Party imposes under this Article has not been fulfilled, that Party may apply the customs duty and any other charge that would normally be owed on importation of the goods.
5. Each Party shall relieve the importer of liability for failure to export a temporarily admitted goods upon presentation of satisfactory proof to the Party's Customs Authority that the goods have been destroyed within the original time limit for temporary admission or any lawful extension. A Party may condition relief of liability under this paragraph by requiring the importer to receive prior approval from the Customs Authority of the importing Party before the destruction of the goods.
6. Each Party, through its Customs Authority, shall adopt and maintain procedures providing for the expeditious release of goods admitted under this Article. To the extent possible, these procedures shall provide that when such goods accompany a national or resident of the other Party who is seeking temporary entry, the goods shall be released simultaneously with the entry of that national or resident.
Article 6.12. Duty-Free Entry of Commercial Samples of Negligible Value and Printed Advertising Materials
Each Party shall, in accordance with its domestic laws and regulations, grant duty-free entry to commercial samples of negligible value and to printed advertising materials imported from the territory of the other Party, but may require that:
(a) such samples be imported solely for the solicitation of orders for goods, or the solicitation of orders for services provided from the territory, of the other Party or a non-Party; or
(b) such advertising materials be imported in packets that each contain no more than one copy of each such material and that neither such materials nor packets form part of a larger consignment.
Article 6.13. Goods Returned or Re-entered after Repair or Alteration
1. Neither Party may apply a customs duty to the goods that re-enters its territory within the timeframe set forth in its laws and regulations after that the goods has been exported from its territory to the territory of the other Party for repair or alteration, regardless of whether such repair or alteration could be performed in its territory, except that a customs duty may be applied to the addition resulting from the repair or alteration that was performed in the territory of the other Party.
2. Neither Party may apply a customs duty to the goods, imported temporarily from the territory of the other Party for repair or alteration, provided such good is exported from the territory of the importing Party according to its laws and regulations.
3. For the purposes of this Article, "repair" or "alteration" means any operation or process undertaken on goods to remedy operational defects or material damage and entailing the re-establishment of the goods to its original function, or to ensure its compliance with technical requirements for its use. Repair or alteration of goods includes restorating, renovating, cleaning, resterilising, maintenance, or other operation or process, regardless of a possible increase in the value of the goods that does not:
(a) destroy a goods' essential characteristics or create a new or commercially different goods;
(b) transform unfinished goods into finished goods; or
(c) change the function of goods.
Article 6.14. Authorised Economic Operators
1. Each Party shall establish or maintain a trade facilitation programme for operators who meet specified criteria, hereinafter referred to as "AEO programme", in accordance with the WCO SAFE Framework of Standards.
2. The National AEO programme, including the specific criteria for qualification, shall be published in accordance with Article 6.4 (Publication and Availability of Information).
3. The specified criteria to qualify as an AEO shall not be designed or applied so as to afford or create arbitrary or unjustifiable discrimination between operators where the same conditions prevail, and it shall allow the participation of small- and medium-sized enterprises.
4. In accordance with Article 19 of the CMAA, both Parties shall endeavour to initiate discussions on an AEO MRA through a Joint Action Plan.
Article 6.15. Border Agency Cooperation
Each Party shall ensure that its authorities and agencies responsible for border controls and procedures dealing with the importation, exportation, and transit of goods cooperate with one another and coordinate their activities in order to facilitate trade pursuant to this Chapter.
Article 6.16. Expedited Shipments
Each Party shall adopt or maintain expedited customs procedures for goods entered through air cargo facilities while maintaining appropriate customs control and selection. These procedures shall:
(a) provide for information necessary to release an express shipment to be submitted and processed before the shipment arrives;
(b) allow for a single submission of information covering all goods contained in an express shipment, such as a manifest, through, if possible, electronic means (2);
(c) to the extent possible, provide for the release of certain goods with a minimum amount of documentation;
(d) under normal circumstances, provide for express shipments to be released as soon as possible after submission of the necessary customs documents, provided the shipment has arrived; and
(e) apply to shipments of any weight or value, recognising that a Party may require formal entry procedures as a condition for release, including declaration and supporting documentation and payment of customs duties, based on the goods' weight or value.
Article 6.17. Review and Appeal
1. Each Party shall ensure that any person to whom it issues a determination on a customs matter has access to: