(d) contribute to the settlement of disputes arising out of the interpretation and application of this Agreement;
(e) supervise the work of all committees established pursuant to this Agreement;
(f) fix the amounts of remuneration and expenses to be paid to panelists, their assistants and experts in accordance with Annex 17.3; and
(g) to deal with any other matter that may affect the operation of this Agreement, or that may be entrusted to it by the Parties.
3. The Commission may:
(a) establish and delegate responsibilities to committees;
(b) adopt, in furtherance of the objectives of this Agreement, decisions necessary to:
(i) incorporate goods into the Tariff Elimination Program set out in the schedules to Annex 3.4 (Tariff Elimination Program), as appropriate, and improve the conditions of access to originating goods contained in that Annex;
(ii) approve the recommendations proposed by the Committee on Rules of Origin, Customs Procedures, Trade Facilitation, and Customs Cooperation, in accordance with Article 4.29(2)(b)(b)(i) (Committee on Rules of Origin, Customs Procedures, Trade Facilitation, and Customs Cooperation); and
(iii) implement other provisions of this Agreement that grant it specific powers, other than those mentioned above.
(c) issue interpretations of the provisions of this Agreement;
(d) seek the advice of persons or groups with no governmental connection; and
(e) take any other action that contributes to the better implementation of this Agreement and to the exercise of its functions.
4. Each Party shall implement, in accordance with its domestic legal procedures, any decision taken pursuant to paragraph 3(b).
5. The Commission shall establish and amend its rules and procedures, and all decisions of the Commission shall be taken by consensus.
6. The Commission shall meet at least once a year in regular session and, at the request of any Party, in special session. These meetings may be held in person or by any technological means. The ordinary sessions shall be chaired successively by each Party.
Article 17.2. Free Trade Agreement Coordinators
1. Each Party shall designate a Free Trade Agreement Coordinator, in accordance with Annex 17.2.
2. The Coordinators shall provide appropriate follow-up to the decisions of the Commission and shall work jointly on the development of agendas, as well as on other preparations for the meetings of the Commission.
3. The Coordinators shall meet when necessary, in person or through any technological means, at the instruction of the Commission or at the request of any of the Parties.
Article 17.3. Administration of Dispute Settlement Procedures
1. Each Party shall:
(a) designate a permanent office to provide administrative support to the arbitration panels referred to in Chapter 18 (Dispute Settlement), and perform other functions at the direction of the Commission; and
(b) notify the Commission of the address of its designated office and the official responsible for its administration.
2. Each Party shall be responsible for:
(a) the operation and costs of its designated office, and.
(b) the remuneration and expenses payable to panelists, their assistants and experts appointed in accordance with Chapter 18 (Dispute Settlement), and as set out in Annex 17.3.
3. The designated offices shall:
(a) upon request, provide assistance to the Commission in accordance with the provisions of Chapter 18 (Dispute Settlement);
(b) upon instructions from the Commission, support the work of working groups or expert groups established in accordance with the provisions of Chapter 18 (Dispute Settlement); and
(c) carry out such other functions as the Commission may direct.
Annex 17.1 . OFFICERS OF THE ADMINISTRATIVE COMMISSION
1. The Commission shall be composed of:
(a) for the case of Mexico, the Secretary of Economy, and.
(b) in the case of Panama, the Minister of Commerce and Industry; or his or her successor.
2. It shall be the responsibility of each Party to keep this Annex updated. To this end, the Parties shall notify in writing any changes to the information contained in paragraph 1.
Annex 17.2 . FREE TRADE AGREEMENT COORDINATORS
1. The Free Trade Agreement Coordinators shall be:
(a) in the case of Mexico, the Head of the International Negotiations Unit of the SecretarÃa de EconomÃa, or his or her designee, and.
(b) in the case of Panama, the Head of the Office of International Trade Negotiations of the Ministry of Commerce and Industries, or his designee;
or their successors.
2. It shall be the responsibility of each Party to keep this Annex updated. To this end, the Parties shall notify in writing any changes to the information contained in paragraph 1.
Annex 17.3 . REMUNERATION AND PAYMENT OF EXPENSES
1. The remuneration of the panelists, their assistants and experts, their transportation and lodging expenses, and all general expenses of the arbitration panels shall be borne equally by the disputing Parties.
2. Each panelist and expert shall keep a record and submit a final account of his or her time and expenses. The arbitration panel shall keep a record and render a final account of all overhead expenses.
Chapter 18. DISPUTE RESOLUTION
Article 18.1. Definitions
For the purposes of this Chapter, the following definitions shall apply:
Code of Conduct: the Code of Conduct established by the Commission pursuant to Article 17.1 (Administrative Commission);
Dispute Settlement Understanding: the Understanding on Rules and Procedures Governing the Settlement of Disputes, which forms part of the WTO Agreement;
perishable goods: perishable agricultural and fishery goods classified in Chapters 1 to 24 of the Harmonized System;
designated office: the office referred to in Article 17.3 (Administration of Dispute Settlement Procedures);
Arbitral Panel: the Arbitral Panel established pursuant to Article 18.8 and, if applicable, pursuant to Article 18.18;
Consulting Parties: the Party consulted and the consulting Party;
disputing Party: the complaining Party or the Party complained against;
Party complained against: the Party against which a claim is made; and
Complaining Party: the party against which a complaint is made; and
Article 18.2. Cooperation
1. The Parties shall at all times endeavor to reach agreement on the interpretation and application of this Agreement through cooperation and consultation and shall endeavor to reach a mutually satisfactory resolution of any matter that may affect its operation.
2. All solutions of matters arising under the provisions of this Chapter shall be consistent with this Agreement and shall not nullify or impair the benefits accruing to the Parties under this Agreement, nor shall they impede the attainment of its objectives.
3. The solutions referred to in paragraph 2 shall be notified to the Commission within 15 days of the agreement of the Parties.
Article 18.3. Scope of Application
Except as otherwise provided in this Agreement, the provisions of this Chapter shall apply:
(a) to the prevention or settlement of all disputes between the Parties relating to the application or interpretation of this Agreement;
(b) where a Party considers that an existing or proposed measure of the other Party is or may be inconsistent with the obligations of this Agreement, or
(c) where a Party considers that an existing or proposed measure of the other Party causes or would cause nullification or impairment in accordance with Annex 18.3.
Article 18.4. Choice of Forum
1. Disputes arising under this Agreement, the WTO Agreement, or any other trade agreement to which the Parties are party may be resolved in the forum of the complaining Party's choice.
2. Once the complaining Party has requested the establishment of an arbitration panel under this Chapter or any other trade agreement referred to in paragraph 1, or has requested the establishment of a panel under the Dispute Settlement Understanding, the forum selected shall be exclusive of any other forum with respect to the same matter.
Article 18.5. Perishable Goods
In disputes relating to perishable goods, the time limits established in this Chapter shall be reduced by half, notwithstanding that the disputing Parties by mutual agreement may decide to modify them.
Article 18.6. Consultations
1. Any Party may request in writing to the other Party consultations with respect to any measure in force or in the pipeline, or with respect to any other matter that it considers may affect the operation of this Agreement in accordance with Article 18.3.
2. The consulting Party shall deliver the request to the Party consulted, through the designated office. The request shall state the reasons for the request and shall include identification of the measure in force or proposed measure or other matter at issue and an indication of the legal basis for the complaint.
3. Through the consultations provided for in this Article, the consulting Parties shall make every effort to reach a mutually satisfactory resolution of any matter. For such purposes, the consulting Parties shall:
(a) shall examine with due diligence the consultations submitted to them;
(b) provide sufficient information to examine how the existing or proposed measure or any other matter could affect the operation of this Agreement; and
(c) treat confidential information exchanged in the course of consultations in the same manner as the Party providing the information.
4. A consulting Party may request the other Party, to the extent possible, to make available to it personnel of its government agencies or other regulatory bodies that have competence in the matter that is the subject of the consultations.
5. Consultations may be conducted in person or by technological means. If conducted in person, the Parties shall endeavor to hold the consultations in the capital of the Party consulted, unless otherwise agreed by the Parties.
6. The period for consultations shall not exceed 30 days following the date of receipt of the request for consultations, unless the consulting Parties agree to extend this period.
7. The consultations shall be confidential and without prejudice to the rights of any Party in any other possible proceedings.
8. Consultations held under any other Chapter shall not replace the consultations referred to in this Article.
Article 18.7. Intervention by the Administrative Commission - Good Offices, Conciliation and Mediation
1. Any consulting Party may request in writing, through the designated office, that the Commission be convened whenever a matter is not resolved in accordance with Article 18.6 within:
(a) 30 days after receipt of the request for consultations; or
(b) such other period as the consulting Parties may agree.
2. A consulting Party may also request in writing, through the designated office, that the Commission be convened where consultations have been held in accordance with Article 18.6.
3. The requesting Party shall deliver the request to the other Party through the designated office. The request shall state the reasons, include identification of the measure in force or proposed measure or other matter at issue, and an indication of the legal basis of the complaint.
4. Unless the Parties agree on a different time limit, the Commission shall meet within 10 days of receipt of the request, and with a view to reaching a mutually satisfactory resolution of the dispute may:
(a) convene technical advisors or establish such working or expert groups as it deems necessary;
(b) resort to good offices, conciliation, mediation or other alternative means of dispute settlement; or
(c) make recommendations.
5. Unless it decides otherwise, the Commission may join 2 or more proceedings before it under this Article relating to the same measure in force or proposed measure or other matter in question. Likewise, the Commission may join 2 or more proceedings concerning other matters before it under this Article, when it considers it appropriate to consider them together.
Article 18.8. Request for the Establishment of the Arbitral Panel
1. Any consulting Party may request in writing the establishment of an Arbitral Panel where the matter has not been resolved within:
(a) 10 days after receipt of the request for intervention by the Commission, if the Commission has not met in accordance with Article 18.7(1);
(b) 30 days following the meeting of the Commission, in accordance with Article 18.7(4);
(c) 30 days after the Commission has met to deal with the most recent matter submitted to it, where several proceedings have been joined in accordance with Article 18.7(5), or
(d) such other period as the consulting Parties may agree.
2. The complaining Party shall deliver the request, through the designated office, to the other Party. The request shall state the reasons and shall include:
(a) the identification of the measure or matter at issue, and.
(b) an indication of the legal basis of the complaint.
3. With the submission of the request to the designated office of the other Party, the Arbitration Panel shall be deemed to have been established by the Commission.(1)
4. Unless otherwise agreed by the disputing Parties, the Arbitration Panel shall be composed and perform its functions in accordance with the provisions of this Chapter, the Model Rules of Procedure and the Code of Conduct.
5. An Arbitral Panel may not be established to review a proposed measure.
Article 18.9. Panels and Qualifications of Panelists
1. On the date of entry into force of this Agreement, each Party shall establish and maintain an indicative list of up to 6 national individuals. These lists shall be referred to as the "Indicative List of Panelists of Mexico" and the "Indicative List of Panelists of Panama" and shall be notified between the Parties. Each Party may modify the panelists on its list when it deems it necessary, after notifying the other Party.
2. In addition, on the date of entry into force of this Agreement, the Parties shall establish by mutual agreement an "Indicative List of Non-Party Panelists" in which they shall designate up to 6 panelists to serve as Chairpersons of the Arbitral Panel in any event. At the request of any Party, the Commission may modify the "Indicative List of Non-Party Panelists" at any time.
3. The lists provided for in this Article shall be adopted by decisions of the Commission.
4. The members of the lists shall:
(a) have expertise or experience in law, international trade, other matters related to this Agreement, or the settlement of disputes arising under international trade agreements;
(b) be chosen strictly on the basis of objectivity, reliability and sound judgment;
(c) be independent, independent of, and not bound by, and not receive instructions from, the Parties; and
(d) comply with the Code of Conduct to be adopted by the Commission no later than 90 days after the entry into force of this Agreement.
5. The Parties may use the indicative lists even if they have not been completed with the number of members established in paragraphs 1 and 2.
6. All panelists shall meet the qualifications set out in paragraph 4.
7. Persons who have been involved in a dispute pursuant to Article 18.7 may not be panelists for the same dispute.
Article 18.10. Membership of the Arbitral Panel
1. The Arbitral Panel shall be composed as follows:
(a) it shall consist of 3 members;
(b) within 15 days of receipt of the request for the establishment of the Arbitration Panel pursuant to Article 18.8, each Party shall appoint a panelist, preferably from its "Tentative List". If a Party fails to designate a panelist within the above time limit, the Secretary General of LAIA, at the request of any Party, shall designate a panelist within 10 days of such request;
(c) by mutual agreement, the Parties shall appoint a third panelist preferably from the "Indicative List of Non-Party Panelists" within 10 days of the date on which the last of the 2 panelists referred to in subparagraph (b) was appointed. The third panelist shall chair the Arbitral Panel and may not be a national of the Parties. If the Parties fail to reach agreement on the designation of the chairperson within the time period provided above, the Secretary General of LAIA, at the request of any Party, shall designate the chairperson within 10 days of such request;
(d) the selection by the Secretary General of LAIA referred to in subparagraphs (a) and (b) shall be made by drawing lots from the indicative lists referred to in Article 18.9 (1) and (2), as appropriate, or failing that, shall select them from the indicative list provided for in the Dispute Settlement Understanding; and
(e) each Party to the dispute shall endeavor to select panelists with relevant experience in the subject matter of the dispute.
2. When an Arbitral Panel is constituted pursuant to paragraph 1, the designated office shall notify the panelists of their appointment. The date of the establishment of the arbitration panel shall be the date on which the last of the panelists has notified the disputing Parties and the designated office of acceptance of his or her selection.
3. Where a disputing Party considers that a panelist has violated the Code of Conduct, the disputing Parties shall consult and, if agreed, remove that panelist and select a new panelist in accordance with this Article.
4. Where there is a need to appoint a new panelist, the proceedings before the Arbitration Panel shall be suspended until the new panelist has accepted his or her appointment.
Article 18.11. Model Rules of Procedure
1. The Commission shall adopt, no later than 90 days after the date of entry into force of this Agreement, Model Rules of Procedure that shall ensure:
(a) the right of the disputing Parties to at least one hearing before the Arbitration Panel;
(b) an opportunity for each disputing Party to submit initial and rebuttal written submissions;
(c) the possibility of using technological means to conduct the proceedings, provided that compliance with the principle of due process and the rules of this Chapter is ensured; and
(d) the protection of confidential information.
Unless otherwise agreed by the disputing Parties, the proceedings before the arbitration panels shall be governed by the Model Rules of Procedure.
3. The Commission may modify the Model Rules of Procedure.
4. Unless the disputing Parties agree otherwise, within 20 days from the date of delivery of the request for the establishment of the Arbitral Panel, the terms of reference of the Arbitral Panel shall be:
"To examine, in the light of the applicable provisions of the Treaty, the dispute submitted to it under the terms of the request for the establishment of the Arbitral Panel and to issue findings, determinations and recommendations, as set out in Articles 18.14 and 18.15."
5. If the disputing Parties have agreed on different terms of reference, they shall notify the Arbitral Panel within 2 days of its establishment.
6. If the complaining Party alleges in the request for the establishment of the Arbitration Panel that a matter has given rise to nullification or impairment within the meaning of Annex 18.3, the terms of reference shall so state.
7. Where a disputing Party requests that the Arbitration Panel make findings on the extent of the adverse trade effects on any Party of the measure found to be inconsistent with this Agreement or to have caused nullification or impairment within the meaning of Annex 18.3, the terms of reference shall so state.
Article 18.12. Information and Technical Advice
On its own initiative or at the request of a disputing Party, the Arbitration Panel may seek information and technical advice from such persons or institutions as it deems appropriate, provided that the disputing Parties so agree, and in accordance with such terms and conditions as those Parties may agree pursuant to the provisions of the Model Rules of Procedure.
Article 18.13. Suspension or Termination of Proceedings
1. After 12 months of inactivity from the date on which the last consultation meeting was held has elapsed without additional steps having been taken, and in the event that the situation that gave rise to the consultations persists and the consulting Party wishes to continue, it shall request new consultations.
2. In the event that the proceeding is at the arbitration stage, at the request of the complaining Party, the Arbitration Panel may suspend the proceeding for a period not exceeding 12 months from the date on which the request for suspension is filed.
3. If the proceedings before the Arbitration Panel have been suspended for more than 12 months, the terms of reference of the Arbitration Panel shall expire. This is without prejudice to the right of the complaining Party to request further consultations on the same matter.
4. At any time prior to the notification of the preliminary report of the Arbitration Panel, the disputing Parties may agree to terminate the proceedings by a mutually satisfactory resolution of the dispute, and shall jointly notify this agreement to the Arbitration Panel, thereby terminating the proceedings before the Arbitration Panel.