1. Each Party shall designate a contact point to receive and facilitate official communications between the Parties on any matter relating to this Agreement.
2. All official communications in relation to this Agreement shall be in the English language.
Chapter 15. EXCEPTIONS
Article 15.1. General Exceptions
1. For the purposes of Chapters 2 (Trade in Goods), 3 (Rules of Origin), 4 (Customs Procedures and Trade Facilitation), 5 (Sanitary and Phytosanitary Measures), and 6 (Technical Barriers to Trade), Article XX of the GAIT 1994 and its interpretative note are incorporated into and form part of this Agreement, mutatis mutandis.
2. For the purposes of Chapters 9 (Trade in Services) and Chapter 10 (Digital Trade) (1), Article XIV of the GATS, including its footnotes, is incorporated into and forms part of this Agreement, mutatis mutandis.
Article 15.2. Security Exceptions
Nothing in this Agreement shall be construed:
(a) to require any Party to furnish any information, the disclosure of which it considers contrary to its essential security interests; or
(b) to prevent any Party from taking any action which it considers necessary for the protection of its essential security interests:
(i) relating to fissionable and fusionable materials or the materials from which they are derived;
(ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials as is carried on directly or indirectly for the purpose of supplying a military establishment;
(iii) relating to the supply of services as carried out directly or indirectly for the purpose of provisioning a military establishment;
(iv) taken in time of war or other emergency rn international relations; or
(c) to prevent any Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
Article 15.3. Taxation
1. Nothing in this Agreement shall apply to any taxation measure. (2)
2. Nothing in this Agreement shall affect the rights and obligations of either Party under any tax convention. In the event of any inconsistency between this Agreement and any such tax convention, that tax convention shall prevail to the extent of the inconsistency.
Chapter 16. DISPUTE SETTLEMENT
Article 16.1. Definitions
For the purposes of this Chapter and Annexes 16A (Rules of Procedure) and 16B (Code of Conduct for Panellists):
complaining Party means a Party that has filed a request for dispute settlement proceedings under this Chapter;
panel means a panel established pursuant to Article 16.10;
responding Party means a Party that has received a request for dispute settlement proceedings under this Chapter.
Article 16.2. Objective
The objective of this Chapter is to establish an effective and efficient mechanism for avoiding and settling disputes between the Parties concerning the interpretation and application of this Agreement with a view to reaching, where possible, a mutually agreed solution.
Article 16.3. Cooperation
The Parties shall endeavour to agree on the interpretation and application of this Agreement and shall make every attempt through cooperation to arrive at a mutually satisfactory resolution of any matter that might affect its operation.
Article 16.4. Scope of Application
Unless otherwise provided for in this Agreement, this Chapter shall apply with respect to the settlement of any dispute between the Parties concerning the interpretation, implementation, or application of this Agreement (hereinafter referred to as "covered provisions"), wherever a Party considers that:
(a) a measure of the other Party is inconsistent with its obligations under this Agreement; or
(b) the other Party otherwise failed to carry out its obligations under this Agreement.
This Chapter shall not cover non-violation complaints and other situation complaints.
Article 16.5. Choice of Forum
1. Unless otherwise provided in this Article, this Chapter is without prejudice to the rights of the Parties to have recourse to dispute settlement procedures available under other international trade agreements to which they are both Parties.
2. When a dispute arises with regard to the alleged inconsistency of a particular measure with an obligation under this Agreement and a substantially equivalent obligation under another international trade agreement to which both Parties are party, including the WTO agreements, the complaining Party may select the forum in which to settle the dispute.
3. Once a Party has selected the forum and initiated dispute settlement proceedings under this Chapter or under the other international agreement with respect to the particular measure referred to in paragraph 2, that Party shall not initiate dispute settlement proceedings in another forum with respect to that particular measure unless the forum selected first fails to make findings on the issues in dispute for jurisdictional or procedural reasons.
4. For purposes of paragraph 3:
(a) dispute settlement proceedings under this Chapter are deemed to be initiated when a Party requests the establishment of a Panel in accordance with Article 16.8;
(b) dispute settlement proceedings under the WTO Agreement are deemed to be initiated when a Party requests the establishment of a Panel in accordance with Article 6 of the WTO Dispute Settlement Understanding; and
(c) dispute settlement proceedings under any other agreement are deemed to be initiated when a Party requests the establishment of a dispute settlement Panel in accordance with the relevant provisions of that agreement.
Article 16.6. Contact Points
1. Each Party shall designate a contact point to facilitate communications between the Parties with respect to any dispute initiated under this Chapter.
2. Any request, notification, written submission or other document made in accordance with this Chapter shall be delivered to the other Party through its designated contact point.
Article 16.7. Request for Information
Before a request for consultations, good offices, conciliation or mediation is made pursuant to Article 16.8 or 16.9 respectively, a Party may request in writing any relevant information with respect to a measure at issue. The Party to which that request is made shall make all efforts to provide the requested information in a written response to be submitted no later than 20 days after the date of receipt of the request.
Article 16.8. Consultations
1. The Parties shall endeavour to resolve any dispute referred to in Article 16.4 by entering into consultations in good faith with the aim of reaching a mutually agreed solution.
2. A Party shall seek consultations by means of a written request delivered to the other Party identifying the reasons for the request, including the measure at issue and a description of its factual basis and the legal basis specifying the covered provisions that it considers applicable.
3. The Party to which the request for consultations is made shall reply to the request promptly, but no later than 10 days after the date of receipt of the request. Consultations shall be held within 30 days of the date of receipt of the request. The consultations shall be deemed to be concluded within 30 days of the date of receipt of the request, unless the Parties agree otherwise.
4. Consultations on matters of urgency including those which concern perishable goods, shall be held within 15 days of the date of receipt of the request. The consultations shall be deemed to be concluded within those 15 days unless the Parties agree otherwise.
5. During consultations each Party shall provide sufficient information so as to allow a complete examination of the measure at issue including how that measure is affecting the operation and application of this Agreement.
6. Consultations, including all information disclosed and positions taken by the Parties during consultations, shall be confidential, and without prejudice to the rights of either Party in any further proceedings.
7. Consultations may be held in person or by any other means of communication agreed by the Parties. Unless the Parties agree otherwise, consultations, if held in person, shall take place in the territory of the Party to which the request is made.
8. If the Party to which the request is made does not respond to the request for consultations within 10 days of the date of its receipt, or if consultations are not held within the timeframes laid down in paragraph 3 or 4 respectively, or if the Parties agree not to have consultations, or if consultations have been concluded and no mutually agreed solution has been reached, the Party that sought consultations may have recourse to Article 16.10.
Article 16.9. Good Offices, Conciliation or Mediation
1. The Parties may at any time agree to enter into procedures for good offices conciliation or mediation. They may begin at any time and be terminated by either Party at any time.
2. Proceedings involving good offices conciliation or mediation and the particular positions taken by the Parties in these proceedings, shall be confidential and without prejudice to the rights of either Party in any further proceedings under this chapter or any other proceedings before a forum selected by the Parties.
3. If the Parties agree, procedures for good offices conciliation or mediation may continue while the panel procedures set out in this Chapter are in progress.
Article 16.10. Establishment of a Panel
1. The complaining Party may request the establishment of a Panel if:
(a) the respondent Party does not reply to the request for consultations in accordance with the time frames referred in Article 16.8;
(b) the consultations referred to in Article 16.8 are not held or fail to settle a dispute within 30 days or 15 days in relation to urgent matters including those which concern perishable goods after the date of the receipt of the request for consultations by the respondent Party;
2. The request for the establishment of a panel shall be made by means of a written request delivered to the other Party and shall identify the measure at issue and indicate the factual basis of the complaint and the legal basis specifying the relevant covered provisions in a manner sufficient to present how such measure is inconsistent with those provisions. 3. When a request is made by the complaining Party in accordance with paragraph I, a panel shall be established.
Article 16.11. Composition of a Panel
1. Unless the Parties agree otherwise, a panel shall consist of three panelists.
2. Within 20 days after the establishment of a panel, each Party shall appoint a panelist. The Parties shall, by common agreement, appoint the third panelist, who shall serve as the chairperson of the panel, within 40 days after the establishment of a panel.
3. If either Party fails to appoint a panelist within the time period established in paragraph 2, the other Party may request that the Secretary-General of the Permanent Court of Arbitration to designate the unappointed panelist within 30 days of that request.
4. If the Parties do not agree on the chairperson of the panel within the time period established in paragraph 2, they shall within the next 10 days, exchange their respective lists comprising three nominees each who shall not be nationals of either Party. The chairperson shall then be appointed by draw of lot from the lists within 10 days after the expiry of the time period during which the Parties shall exchange their respective lists of nominees. The selection by lot of the chairperson of the panel shall be made by the Joint Committee.
5. If a Party fails to submit its list of three nominees within the time period established in paragraph 4, the chairperson shall be appointed by draw of lot from the list submitted by the other Party.
6. The date of composition of the panel shall be the date on which the last of the three selected panelists has notified to the Parties the acceptance of his or her appointment.
Article 16.12. Decision on Urgency
If a Party so requests, the panel shall decide, within 15 days of its composition, whether the dispute concerns matters of urgency.
Article 16.13. Requirements for Panelists
1. Each panelist shall: (a) have demonstrated expertise in law, international trade, and other matters covered by thjg Agreement;
(b) be independent of, and not be affiliated with or take instructions from, either Party;
(c) serve in their individual capacities and not take instructions from any organisation or government with regard to matters related to the dispute;
(d) comply with the Code of Conduct for Panelists established in Annex 16B (Code of Conduct for Panelists); and
(e) be chosen strictly on the basis of objectivity, reliability, and sound judgment.
2. The chairperson shall also have experience in dispute settlement procedures.
3. Persons who provided good offices, conciliation or mediation to the Parties, pursuant to Article 16.9 in relation to the same or a substantially equivalent matter, shall not be eligible to be appointed as panelists in that matter.
Article 16.14. Replacement of Panelists
If any of the panelists of the original panel becomes unable to act, withdraws or needs to be replaced because that panelist does not comply with the requirements of the code of conduct, a successor panelist shall be appointed in the same manner as prescribed for the appointment of the original panelist and the successor shall have the powers and duties of the original panelist. The work of the panel shall be suspended during the appointment of the successor panelist.
Article 16.15. Functions of the Panel
Unless the Parties otherwise agree, the Panel:
(a) shall make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity of the measure at issue with the covered provisions;
(b) shall set out, in its decisions and reports, the findings of fact and law and the rationale behind any findings and conclusions that it makes; and
(c) should consult regularly with the Parties and provide adequate opportunities for the development of a mutually agreed solution.
Article 16.16. Terms of Reference
1. Unless the Parties otherwise agree within 15 days after the date of establishment of the panel, the terms of reference of the panel shall be:
"to examine, in the light of the relevant covered provisions of this Agreement cited by the Parties, the matter referred to in the request for the establishment of the panel, to make findings on the confonnity of the measure at issue with the relevant covered provisions of this Agreement as well as recommendations, if any, on the means to resolve the dispute, and to deliver a report in accordance with Articles 16.20 and 16.21."
2. If the Parties agree on other terms of reference than those referred to in paragraph 1, they shall notify the agreed terms of reference to the panel no later than 5 days after their agreement.
Article 16.17. Rules of Interpretation
1. The panel shall interpret the covered provisions in accordance with customary rules of interpretation of public international law.
2. When appropriate, the panel may also take into account relevant interpretations in reports of prior panels established under this Agreement and reports of panels and the Appellate Body adopted by the Dispute Settlement Body of the WTO.
Article 16.18. Procedures of the Panel
1. Unless the Parties otherwise agree, the Panel shall follow the model rules of procedure set out in Annex 16A (Rules of Procedure for the Panel).
2. The Panel may, after consulting with the Parties, adopt additional rules of procedure not inconsistent with the model rules of procedures.
3. There shall be no ex parte communications with the Panel concerning matters under its consideration.
4. The deliberations of the Panel and the documents submitted to it shall be kept confidential.
5. A Party asserting that a measure of the other Party is inconsistent with the provisions of this Agreement shall have the burden of establishing such inconsistency. A Party asserting that a measure is subject to an exception under this Agreement shall have the burden of establishing that the exception applies.
6. The Panel should consult with the Parties as appropriate and provide adequate opportunities for the development of a mutually agreed solution.
7. The Panel shall make its decisions, including its reports by consensus, but if consensus is not possible then by majority of its members. Any member may furnish separate opinions on matters not unanimously agreed, but dissenting opinions of members shall in no case be disclosed.
Article 16.19. Receipt of Information
1. Upon the request of a Party, or on its own initiative, the panel may seek from the Parties relevant information it considers necessary and appropriate. The Parties shall respond promptly and fully to any request by the panel for information.
2. Upon the request of a Party or on its own initiative, the panel may seek from any source any information it considers appropriate. The panel also has the right to seek the opinion of experts, as it considers appropriate, and subject to any terms and conditions agreed by the Parties, where applicable.
3. On request of a Party, or on its own initiative, the panel may seek information and technical advice from any individual or body that it deems appropriate, provided that the Parties agree and subject to such terms and conditions as the Parties agree. The panel shall provide the Parties with any information so obtained for comment.
4. Any information obtained by the panel under this Article shall be made available to the Parties and the Parties may provide comments on that information.
Article 16.20. Interim Report
1. The panel shall deliver an interim report to the Parties within 90 days after the date of composition of the panel. When the panel considers that this deadline cannot be met, the chairperson of the panel shall notify the Parties in writing, stating the reasons for the delay and the date on which the panel plans to deliver its interim report. Under no circumstances shall the delay exceed 30 days after the deadline.
2. The interim report shall set out a descriptive part and the panel's findings and conclusions.
3. Each Party may submit to the panel written comments and a written request to review precise aspects of the interim report within 15 days of the date of issuance of the interim report. A Party may comment on the others Party's request within 6 days of the delivery of the request.
4. After considering any written comments and requests by each Party on the interim report, the panel may modify the interim report and make any further examination it considers appropriate.
Article 16.21. Final Report
1. The panel shall deliver its final report to the Parties within 120 days of the date of composition of the panel. When the panel considers that this deadline cannot be met, the chairperson of the panel shall notify the Parties in writing, stating the reasons for the delay and the date on which the panel plans to deliver its final report. Under no circumstances shall the delay exceed 30 days after the deadline.
2. The final report shall include a discussion of any written comments and requests made by the Parties on the interim report. The panel may, in its final report, suggest ways in which the final report could be implemented.
3. The final report shall be made public within 15 days of its delivery to the Parties unless the Parties otherwise agree to publish the final report only in parts or not to publish the final report.
Article 16.22. Implementation of the Final Report
1. Where the panel finds that the respondent Party has acted inconsistently with a covered provision, the respondent Party shall take any measure necessary to comply promptly and in good faith with the findings and conclusions in the final report.
2. The respondent Party shall promptly comply with the ruling of the Panel. If it is impracticable to comply immediately, the respondent Party shall, no later than 30 days after the delivery of the final report, notify the complaining Party of the length of the reasonable period of time necessary for compliance with the final report and the Parties shall endeavour to agree on the reasonable period of time required for compliance with the final report.
Article 16.23. Reasonable Period of Time for Compliance
1. If the Parties have not agreed on the length of the reasonable period of time, the complaining Party may, no later than 20 days after the date of receipt of the notification made by the respondent Party in accordance with Article 16.22.2 request in writing the original panel to determine the length of the reasonable period of time. Such request shall be notified simultaneously to the respondent Party. The 20-day period referred to in this paragraph may be extended by mutual agreement of the Parties.
2. The original panel shall deliver its decision to the Parties within 20 days from the relevant request.
3. The length of the reasonable period of time for compliance with the final report may be extended by mutual agreement of the Parties.
Article 16.24. Compliance Review
1. The respondent Party shall deliver a written notification of its progress in complying with the final report to the complaining Party at least one month before the expiry of the reasonable period of time for compliance with the final report unless the Parties agree otherwise.
2. The respondent Party shall, no later than at the date of expiry of the reasonable period oftime, deliver a notification to the complaining Party of any measure that it has taken to comply with the final report along with a description on how the measure ensures compliance sufficient to allow the complaining Party to asse s the measure before the expiry of the reasonable period of time.
3. Where the Parties disagree on the existence of measures to comply with the final report, or their consistency with the covered provisions, the complaining Party may request in writing the original panel to decide on the matter before compensation can be sought or suspension of benefits can be applied in accordance with Article 16.25.1.(c). Such request shall be notified simultaneously to the respondent Party.
4. The request shall provide the factual and legal basis for the complaint, including the identification of the specific measures at issue and an indication of why any measures taken by the respondent fail to comply with the final report or are otherwise inconsistent with the covered provisions.
5. The panel shall deliver its decision to the Parties within 60 days of the date of delivery of the request.
Article 16.25. Temporary Remedies In Case of Non-Compliance
1. If the respondent Party:
(a) fails to notify any measure taken to comply with the final report before the expiry of the reasonable period of time;
(b) notifies the complaining Party in writing that it is not practicable to comply with the final report within the reasonable period of time; or
(c) the original panel finds that no measure taken to comply exists or that the measure taken to comply with the final report as notified by the party complained against is inconsistent with the covered provisions.
The respondent Party shall, on request of the complaining Party, enter into consultations with a view to agreeing on a mutually satisfactory agreement or any necessary compensation.
2. If the Parties fail to reach a mutually satisfactory agreement or to agree on compensation within 20 days after the date ofreceipt of the request made in accordance with paragraph 1, the complaining Party may deliver a written notification to the respondent Party that it intends to suspend the application to that Party of benefits or other obligations under this Agreement. The notification shall specify the level of intended suspension of benefits or other obligations.
3. The complaining Party may begin the suspension of benefits or other obligations referred to in the preceding paragraph 20 days after the date when it served notice on the Party complained against, unless the respondent Party made a request under paragraph 7.
4. The suspension of benefits or other obligations:
(a) shall be at a level equivalent to the nullification or impairment that is caused by the failure of the respondent Party to comply with the final report; and
(b) shall be restricted to benefits accruing to the respondent Party under this Agreement.
5. In considering what benefits to suspend in accordance with paragraph 2, the complaining Party shall apply the following principles: (a) the complaining Party should first seek to suspend benefits in the same sector or sectors as that affected by the measure that the Panel has found to be inconsistent with this Agreement or have caused nullification or impairment; (1)
(b) the complaining Party may suspend benefit in other sectors, if it considers that it is not practicable or effective to suspend benefits or other obligations in the same sector; and
(c) in the selection of the benefits to suspend, the complaining Party shall endeavour to take into consideration those which least disturb the implementation of this Agreement.
6. The suspension of benefits or other obligations shall be temporary and shall only apply until the inconsistency of the measure with the relevant covered provisions which has been found in the final report has been removed, or until the Parties have agreed on a mutually satisfactory agreement or any necessary compensation.
7. If the respondent Party considers that the suspension of benefits does not comply with paragraphs 4 and 5, that Party may request in writing the original panel to examine the matter no later than 15 days after the date of receipt of the notification referred to in paragraph 2. That request shall be notified simultaneously to the complaining Party. The original Panel shall notify to the parties its decision on the matter no later than 30 days of the receipt of the request from the respondent Party. Benefits or other obligations shall not be suspended until the original panel has delivered its decision. The suspension of benefits or other obligations shall be consistent with this decision.