(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 8.7. Most-favoured-nation Treatment
1. Where a Party schedules commitments in accordance with this Section, in respect of the services sectors listed in Annex 8-A, and subject to any conditions and qualifications set out therein, the Party shall accord to services and service suppliers of the other Party treatment no less favourable than that it accords to like services and service suppliers of any non-party.(5)
2. Notwithstanding paragraph 1, a Party may adopt or maintain any measure that accords differential treatment to any non-party in accordance with any free trade agreement or multilateral international agreement in force or signed prior to the date of entry into force of this Agreement.
3. For greater certainty, paragraph 2 includes, in respect of agreements on the liberalisation of trade in goods or services or investment, any measures taken as part of a wider process of economic integration or trade liberalisation.
4. For sectors not covered by paragraph 1, if, after the date of entry into force of this Agreement, a Party subsequently enters into any agreement with a non-party in which it provides treatment to services or service suppliers of that non-party more favourable than it accords to like services or service suppliers of the other Party, the other Party may request consultations to discuss the possibility of extending, under this Agreement, treatment no less favourable than that provided under the agreement with the non-party. In such circumstances, the Parties shall enter into consultations bearing in mind the overall balance of benefits.
5. The provisions of this Agreement shall not be construed as to prevent a Party 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 8.8. Additional Commitments
A Party making commitments in accordance with this Section may also negotiate commitments with respect to measures affecting trade in services not subject to scheduling under Articles 8.5 and 8.6, including but not limited to those regarding qualification, standards or licensing matters. Such commitments shall be inscribed in that Party's Schedule of Specific Commitments in Annex I.
Section B. Negative Listing Approach
Article 8.9. Schedule of Non-conforming Measures
1. For a Party making commitments in accordance with this Section, Articles 8.10 through 8.12 shall not apply to:
(a) any non-conforming measure that is maintained by the following on the date of entry into force of this Agreement, as set out in Section A of a Party's Schedule of Non-Conforming Measures in Annex III:
(i) the central government of a Party; or
(ii) a regional level of government;
(b) any non-conforming measure that is maintained by a local level of government other than a regional level of government referred to in subparagraph (a)(ii) on the date of entry into force of this Agreement; or
(c) the continuation or prompt renewal of any non-conforming measure referred to in subparagraphs (a) and (b).
2. Articles 8.10 through 8.12 shall not apply to any measure that a Party adopts or maintains with respect to sectors, sub-sectors or activities set out in Section B of its Schedule of Non-Conforming Measures in Annex III.
3. Schedules of Non-Conforming Measures are annexed to this Agreement as Annex III and shall form an integral part thereof.
Article 8.10. National Treatment
1. For a Party making commitments in accordance with this Section, it shall accord to services and service suppliers of the other Party treatment no less favourable than that it accords to its own like services and service suppliers. (6)
2. A Party may meet the requirement in paragraph 1 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 by a Party shall be considered to be less favourable if it modifies the conditions of competition in favour of services or service suppliers of that Party compared to the like service or service suppliers of the other Party.
Article 8.11. Market Access
For a Party making commitments in accordance with this Section, (7) with respect to market access through the modes of supply identified in Article 8.2(x), it shall not adopt or maintain, either on the basis of a regional subdivision or on the basis of its entire territory, measures that 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 requirements of an economic needs test;
(c) limitations on the total number of service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirements of an economic needs test;
(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 requirements of an economic needs test; (8)
(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and
ff) 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 8.12. Most-favoured-nation Treatment
1. For a Party making commitments in accordance with this Section, it shall, unless otherwise indicated in its Schedule of Non-Conforming Measures in Annex III, accord to services and service suppliers of the other Party treatment no less favourable than it accords to like services and service suppliers of any non-party.
2. Notwithstanding paragraph 1, a Party may adopt or maintain any measure that accords differential treatment to any non-party in accordance with any free trade agreement or multilateral international agreement in force or signed prior to the date of entry into force of this Agreement.
3. For greater certainty, paragraph 2 includes, in respect of agreements on the liberalisation of trade in goods or services or investment, any measures taken as part of a wider process of economic integration or trade liberalisation.
4. For those sectors exempted from the operation of paragraph 1 by a Party's Schedule of Non-Conforming Measures in Annex III and where, after this Agreement enters into force, that Party subsequently enters into any agreement with a non-party in which it provides treatment to services or service suppliers of that non-party more favourable than it accords to like services or service suppliers of the other Party, the other Party may request consultations to discuss the possibility of extending, under this Agreement, treatment no less favourable than that provided under the agreement with the non-party. In such circumstances, the Parties shall enter into consultations bearing in mind the overall balance of benefits.
5. The provisions of this Agreement shall not be construed as to prevent a Party 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.
Section III. Other Provisions
Article 8.13. 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.
(a) Each Party shall maintain or institute as soon as practicable judicial, arbitral or administrative tribunals or procedures which provide, on request of an affected service supplier, 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.
(b) The provisions of subparagraph (a) shall not be construed to require a Party to institute such tribunals or procedures where this would be inconsistent with its constitutional structure or the nature of its legal system.
3. Where authorisation is required for the supply of a service on which a specific commitment under this Agreement has been made, the competent authorities of each Party shall:
(a) in the case of an incomplete application, on request of the applicant, identify all the additional information that is required to complete the application and provide the opportunity to remedy deficiencies within a reasonable timeframe;
(b) on request of the applicant, provide without undue delay information concerning the status of the application; and
(c) if an application is terminated or denied, to the maximum extent possible, inform the applicant in writing and without delay the reasons for such action. The applicant will have the possibility of resubmitting, at its discretion, a new application.
4. To ensure that measures relating to qualification requirements and procedures, technical standards and licensing requirements do not constitute unnecessary barriers to trade in services, the Parties shall jointly review the results of the negotiations on disciplines on these measures pursuant to paragraph 4 of Article VI of GATS, with a view to their incorporation into this Agreement. The Parties note that such disciplines aim to ensure that such requirements are, inter alia:
(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.
5.
(a) In sectors in which a Party has undertaken specific commitments, pending the incorporation of the disciplines referred to in paragraph 4, that Party shall not apply licensing and qualification requirements and technical standards that nullify or impair its obligation under this Agreement in a manner which:
(i) does not comply with the criteria outlined in subparagraphs 4(a), (b) or (c); and
(ii) could not reasonably have been expected of that Party at the time the specific commitments in those sectors were made.
(b) In determining whether a Party is in conformity with the obligation under subparagraph 5(a), account shall be taken of international standards of relevant international organisations applied by that Party (9)
6. 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.
7. A Party shall, in accordance with its laws and regulations, permit services suppliers of the other Party to use enterprise names under which they trade in the territory of the other Party.
Article 8.14. 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 service suppliers, and subject to the requirements of paragraph 4, a Party may recognise, or encourage its relevant competent bodies to recognise, the education or experience obtained, requirements met, or licences or certifications granted in the other Party. Such recognition, which may be achieved through harmonisation or otherwise, may be based upon an agreement or arrangement between the Parties or their relevant competent bodies, 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 in Articles 8.7 or 8.12 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 2, whether existing or in the future, shall afford adequate opportunity for the other Party, on request, 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 the education, experience, licences or certifications obtained or requirements met in that other Party's territory should also be recognised.
4. A Party shall not accord recognition in a manner which would constitute a means of discrimination between the other Party and non-parties in the application of its standards or criteria for the authorisation, licensing or certification of service suppliers, or a disguised restriction on trade in services.
Article 8.15. Qualifications Recognition Cooperation
1. The Parties agree to encourage, where possible, the relevant bodies in their respective territories responsible for issuance and recognition of professional and vocational qualifications to strengthen cooperation and to explore possibilities for mutual recognition of respective professional and vocational qualifications.
2. Each Party, where possible, will encourage the relevant bodies in its territory to
develop, where possible, mutually acceptable standards and criteria for licensing and certification, and to provide recommendations to the Committee on Trade in Services on mutual recognition with respect to service sectors mutually agreed by the Parties, including engineering and Traditional Chinese Medicine.
3. The Parties may discuss, as appropriate, relevant bilateral, plurilateral and multilateral agreements relating to professional and vocational services.
Article 8.16. Payments and Transfers
1. Except in the circumstances envisaged in Article 16.6 (Measures to Safeguard the Balance-of-Payments) of Chapter 16 (General Provisions and Exceptions), a Party shall not apply restrictions on international transfers and payments for current transactions relating to its specific commitments.
2. Nothing in this Chapter shall affect the rights and obligations of the Parties as members of the International Monetary Fund in accordance with the Articles of Agreement of the International Monetary Fund, including the use of exchange actions which are in conformity with the Articles of Agreement, provided that a Party shall not impose restrictions on any capital transactions inconsistently with its specific commitments regarding such transactions, except under Article 16.6 (Measures to Safeguard the Balance of Payments) of Chapter 16 (General Provisions and Exceptions), or at the request of the International Monetary Fund.
Article 8.17. Denial of Benefits
Subject to prior notification and consultation, a Party may deny the benefits of this Chapter to a service supplier of the other Party if the service supplier is a juridical person:
(a) owned or controlled by persons of a non-party or of the denying Party; and
(b) has no substantive business operations in the territory of the other Party.
Article 8.18. Transparency
1. Each Party shall ensure that:
(a) regulatory decisions, including the basis for such decisions, are promptly published or otherwise made available to all interested persons; and
(b) its measures relating to public networks or services are made publicly available, including the requirements, if any, for permits.
2. Each Party shall ensure that, where a licence is required, all measures relating to the licensing of suppliers of public networks or services are made publicly available, including:
(a) the circumstances in which a licence is required; (b) all applicable licencing procedures;
(c) the period of time normally required to reach a decision concerning a licence application;
(d) the cost of, or fees for applying for, or obtaining, a licence; and (e) the period of validity of a licence.
3. Each Party shall, in accordance with its laws and regulations, ensure that, on request, an applicant receives reasons for the denial of, revocation of, refusal to renew, or the imposition or modification of conditions on, a licence. Each Party shall endeavour to provide, to the extent possible, such information in writing.
Article 8.19. Telecommunication Services
1. The Annex on Telecommunications of GATS and Reference Paper on Telecommunications shall be incorporated, mutatis mutandis, into and form an integral part of this Agreement.
2. Each Party shall ensure that licensing requirements for suppliers of telecommunications networks or services of the other Party are applied in the least trade restrictive manner and are not more burdensome than necessary.
3. Each Party shall facilitate consultation with suppliers of public telecommunications networks or services of the other Party operating in its territory in the development of telecommunications policy, regulations and standards.
4. In accordance with its laws and regulations, each Party shall ensure that suppliers of public telecommunications networks or services of the other Party operating in its territory are provided with adequate advance notice (10) of, and the opportunity to comment on, regulatory decisions of general application that its telecommunications regulatory body proposes.
5. The Parties shall encourage their respective telecommunications service suppliers to cooperate to reduce the wholesale rates for international mobile roaming between the two Parties, with a view to reducing international mobile roaming rates.
Article 8.20. Committee on Trade In Services
1. The Parties hereby establish a Committee on Trade in Services (the "Committee") that shall meet within two years of the date of entry into force of this Agreement, or as agreed by the Parties, or on the request of the FTA Joint Commission, to consider any matter arising under this Chapter.
2. The Committee's functions shall include: (a) reviewing the implementation and operation of this Chapter;
(b) identifying and recommending measures to promote increased services trade between the Parties; and
(c) considering other trade in services issues of interest to a Party.
3. With the agreement of both Parties, representatives from relevant agencies or sectors may be invited to attend the Committee meetings.
Article 8.21. Contact Points
Each Party shall designate one or more contact points to facilitate communications between the Parties on any matter covered by this Chapter, and shall provide details of such contact points to the other Party. The Parties shall notify each other promptly of any amendments to the details of their contact points.
Article 8.22. Modification of Schedules
1. A Party (referred to in this Article as the "modifying Party") may modify or withdraw any commitment in its Schedule in Annex III at any time after three years have elapsed from the date on which that commitment entered into force, provided that:
(a) it notifies the other Party (referred to in this Article as the "affected Party") of its intention to modify or withdraw a commitment no later than three months before the intended date of implementation of the modification or withdrawal; and
(b) upon notification of a Party's intent to make such modification, the Parties shall consult and attempt to reach agreement on the appropriate compensatory adjustment.
2. In achieving a compensatory adjustment, the Parties shall endeavour to maintain a general level of mutually advantageous commitment that is not less favourable to trade than provided for in the Schedules prior to such negotiations.
3. If agreement under paragraph 1(b) is not reached between the modifying Party and the affected Party within three months, the affected Party may refer the matter to an arbitral tribunal in accordance with the procedures set out in Chapter 15 (Dispute Settlement) or, where agreed between the Parties, to an alternative arbitration procedure.
4. The modifying Party may not modify or withdraw its commitment until it has made the compensatory adjustments in conformity with the findings of the arbitral tribunal in accordance with paragraph 3.
5. If the modifying Party implements its proposed modification or withdrawal and does not comply with the findings of the arbitral tribunal, the affected Party may modify or withdraw substantially equivalent benefits in conformity with the findings of the arbitral tribunal.
Article 8.23. 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 its Schedule in Annex I.
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 in its Schedule in Annex III, 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. If a Party has reason to believe that a monopoly supplier of a service of the other Party is acting in a manner inconsistent with paragraph 1 or 2, that Party may request the other Party establishing, maintaining or authorising such supplier to provide specific information concerning the relevant operations.
4. If, after the date of entry into force of this Agreement, a Party grants monopoly tights regarding the supply of a service covered by its specific commitments in its Schedule in Annex HI, that Party shall notify the other Party no later than three months before the intended implementation of the grant of monopoly rights, and paragraphs 1(b) and 2 of Article 8.22 shall apply.
5. 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 8.24. Review
1. The Parties shall consult within two years of the date of entry into force of this Agreement and every two years thereafter, or as otherwise agreed, to review the implementation of this Chapter and consider other trade in services issues of mutual interest, with a view to the progressive liberalisation of the trade in services between them on a mutually advantageous basis.
2. Where a Party unilaterally liberalises a measure affecting market access of a service supplier or suppliers of the other Party, the other Party may request consultations to discuss the measure. Following such consultations, if the Parties agree to incorporate the liberalised measure into the Agreement as a new commitment, the relevant Schedule in Annex III shall be amended.
3. After the entry into force of this agreement, at a time to be mutually agreed by the Parties, the Parties shall initiate next round of the negotiation on trade in services in the form of negative listing approach, and conclude such negotiation as soon as they could.
Article 8.25. Cooperation
Bilateral Taxation Arrangements
1. The Parties shall review their bilateral taxation arrangements, (11) having regard to mutual economic objectives and international taxation standards.
Traditional Chinese Medicine Services ("TCM")
2. Within the relevant committees to be established in accordance with this Agreement, and subject to available resources, Australia and China shall cooperate on matters relating to trade in TCM services.
3. Cooperation identified in paragraph 2 shall:
(a) include exchanging information, where appropriate, and discussing policies, regulations and actions related to TCM services; and
(b) encourage future collaboration between regulators, registration authorities and relevant professional bodies of the Parties to facilitate trade in TCM and complementary medicines, in a manner consistent with all relevant regulatory frameworks. Such collaboration, involving the competent authorities of both Parties — for Australia, notably the Department of Health, and for China the State Administration of Traditional Chinese Medicine — will foster concrete cooperation and exchanges relating to TCM.
ANNEX 8-A. Sector coverage under article 8.7
| Sector | Conditions/Qualification |
| Environmental services (CPC 9401-9406, 9409) | |
| Construction and telated engineering services (CPC 512, 514, 516 and 517) | |
| Services incidental to forestry (CPC 8814) | The commitment is limited to preferential treatment accorded to members of the Organization for Economic Cooperation and Development (“OECD”) |
| Engineering services (CPC 8672) | |
| Integrated engineering services (CPC 8673) | |
| Computer and related services (CPC841, 842, 843, 844, 845 and 849) | |
| Tourism and travel related services (CPC 641, 642, 643, 7471 and 7472) | |
| Related scientific and technical consulting services (CPC 8675, excluding the services related to national security) | |
| Securities services | |
| Education services (excluding national compulsory education and special education services e.g. military, police, political and party school education) |