2. In taking measures under the WTO provisions referred to in paragraph 1, a Party shall exclude imports of an originating product from one or several Parties if such imports do not in and of themselves cause or threaten to cause serious injury. The Party taking the measure shall make such exclusion in accordance with WTO jurisprudence.
3. No Party may apply, with respect to the same product, at the same time:
(a) a bilateral safeguard measure; and
(b) a measure under Article XIX of the GATT 1994 and the Safeguards Agreement.
Article 2.18. Bilateral Safeguard Measures
1. During the transition period, where, as a result of the reduction or elimination of a customs duty under this Agreement, a product originating in a Party is being imported into another Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to constitute a substantial cause of serious injury or threat thereof to the domestic industry of like or directly competitive products in the importing Party, the importing Party may take safeguard measures to the minimum extent necessary to remedy or prevent the injury, subject to the provisions of this Article.
2. For the purposes of this Article:
(a) transition period means ten years from the date of entry into force of this Agreement. For goods for which Annex VIII (Industrial Goods) provides for tariff elimination of more than ten years, transition period means the tariff elimination period for the goods set out in that Annex; and
(b) substantial cause means a cause which is more important than any other cause.
3. Safeguard measures shall only be taken upon clear evidence that increased imports have caused or are threatening to cause serious injury pursuant to an investigation in accordance with the procedures and definitions laid down in Articles 3 and 4 of the Safeguards Agreement.
4. The Party intending to take or extend a safeguard measure under this Article shall, immediately and in any case no later than 30 days before taking a measure, make notification to the other Parties. The notification shall contain all pertinent information, which shall include evidence of serious injury or threat thereof caused by increased imports, a precise description of the product involved, and the proposed measure, as well as the date of completion of the investigation procedure referred to in paragraph 3, expected duration and timetable for the progressive removal of the measure.
5. A Party applying a bilateral safeguard measure shall, after consultations with the other Party, provide mutually agreed trade liberalisation compensation in the form of concessions having substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the measure. The Party applying the measure shall provide an opportunity for such consultations no later than 15 days following the date of the application of the bilateral safeguard measure.
6. If the conditions in paragraphs 1 and 3 are met, the importing Party may to the extent necessary to prevent or remedy serious injury or threat thereof:
(a) suspend the further reduction of any rate of duty provided for under this Agreement for the product; or
(b) increase the rate of customs duty for the product to a level not to exceed the lesser of:
(i) the MFN applied rate of duty in effect at the time the measure is imposed; or
(ii) the MFN applied rate of duty in effect on the day immediately preceding the date of the entry into force of this Agreement.
7. No Party may maintain a bilateral safeguard measure:
(a) except to the extent, and for such period of time, as may be necessary to prevent or remedy serious injury and to facilitate adjustment;
(b) for a period exceeding two years. The period may be extended by up to one year if the competent authority determines, in conformity with the procedures set out in paragraphs 3 and 4, that the measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the domestic industry is adjusting; or
(c) beyond the expiration of the transition period.
8. No bilateral safeguard measure shall be applied to the import of a product, which has previously been subject to such a measure.
9. Within 30 days following the date of notification specified in paragraph 4, the Party conducting a safeguard proceeding under this Chapter, shall enter into consultations with a Party whose product is subject to that proceeding, in order to facilitate a mutually acceptable solution of the matter and shall notify to the Parties the results of the consultations. In the absence of such solution, the importing Party may adopt a measure pursuant to paragraph 6.
10. In the absence of mutually agreed compensation referred to in paragraph 5, the Party against whose product the measure is taken may take compensatory action. The safeguard measure and the compensatory action shall be immediately notified to the other Parties. In the selection of the safeguard measure and the compensatory action, priority must be given to the action which least disturbs the functioning of this Agreement. The compensatory action shall normally consist of suspension of concessions having substantially equivalent trade effects or concessions substantially equivalent to the value of the additional duties expected to result from the safeguard measure. The Party taking compensatory action shall apply the action only for the minimum period necessary to achieve the substantially equivalent trade effects and in any event only while the measure under paragraph 6 is being applied.
11. In order to facilitate adjustment in a situation where the expected duration of a safeguard measure is one year or more, the Party applying the measure shall progressively liberalise it at regular intervals during the period of application.
12. Upon the termination of the measure, the rate of customs duty shall be the rate which would have been in effect but for the measure.
13. In critical circumstances, where delay would cause damage which would be difficult to repair, a Party may take a provisional safeguard measure pursuant to a preliminary determination that there is clear evidence that increased imports constitute a substantial cause of serious injury, or threat thereof, to the domestic industry. The Party intending to take such a measure shall immediately notify all the Parties. During the time of the application of the provisional safeguard measure, the pertinent requirements and procedures set out in paragraphs 3 to 10 shall be met.
14. Any provisional safeguard measures shall be terminated within 180 days at the latest. The following modalities shall apply:
(a) the period of application of any such provisional measure shall be counted as part of the duration of the measure set out in paragraph 7 and any extension thereof;
(b) a provisional safeguard measure may only be imposed as a tariff increase pursuant to paragraph 6. Any additional duty actually paid shall be promptly refunded, and any guarantee shall be liberated, if the investigation described in paragraph 3 does not result in a finding that the conditions of paragraph 1 are met; and
(c) any mutually agreed compensation, or compensatory action, shall be based on the total period of application of the provisional safeguard measure and of the safeguard measure.
Article 2.19. General Exceptions
For the purposes of this chapter, the rights and obligations of the Parties in respect of General Exceptions shall be governed by Article XX of the GATT 1994, which is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.20. Security Exceptions
For the purposes of this Chapter, the rights and obligations of the Parties in respect of Security Exceptions shall be governed by Article XXI of the GATT 1994, which is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Chapter 3. Processed Agricultural Products
Article 3.1. Scope
1. Processed agricultural products shall be governed by chapter 2 (Trade in Goods), unless otherwise provided for in this chapter.
2. The Parties reaffirm their rights and obligations under the WTO Agreement on Agriculture.
Article 3.2. Price Compensation Measures
1. In order to take account of differences in the cost of the agricultural raw materials incorporated into the products referred to in Article 3.3 (Tariff Concessions), this Agreement does not preclude the levying, upon import, of a duty.
2. The duty levied upon import shall be based on, but not exceed, the difference between the domestic price and the world market price of the agricultural raw materials incorporated into the products concerned.
Article 3.3. Tariff Concessions
1. Taking into account the provisions laid down in Article 3.2 (Price Compensation Measures) the EFTA States shall accord for products listed in Appendix 1 to Annex III (Processed Agricultural Products), originating in Peru, treatment no less favourable than that accorded to the European Union.
2. Based on any reduction of customs duties on imports according to paragraph 1 granted by the EFTA States to Peru, Peru shall reciprocally reduce its customs duties on imports. The reduction shall be proportional to the lowest reduction granted by an EFTA State to Peru.
3. For products listed in Appendix 2 to Annex III (Processed Agricultural Products), and originating in an EFTA State, Peru shall reduce its customs duties on imports as specified therein.
Article 3.4. Agricultural Export Subsidies
1. Notwithstanding paragraph 2 of Article 3.1, the Parties shall not adopt, maintain, introduce or re-introduce export subsidies, as defined in the WTO Agreement on Agriculture, in their trade in products subject to tariff concessions in accordance with this Agreement.
2. Should a Party adopt, maintain, introduce or re-introduce export subsidies on a product subject to a tariff concession in accordance with Article 3.3 (Tariff concessions), the other Party may increase the rate of duty on such imports up to the applied MFN customs duty on imports in effect at that date. If a Party increases the rate of duty, it shall notify the other Party within 30 days following the date the duty was increased.
Article 3.5. Price Band System
Peru may maintain its Price Band System for agricultural products as set out in Appendix 3 to Annex III (Processed Agricultural Products).
Article 3.6. Notification
1. The EFTA States shall notify Peru, of all measures applied under Article 3.2 (Price compensation Measures), at an early stage, at the latest 30 days after the entry into force of this Agreement.
2. The EFTA States shall inform Peru of all changes in the treatment accorded to the European Union.
Article 3.7. Consultations
Peru and the EFTA States shall periodically review the development of their trade in processed agricultural products covered by this chapter. In light of these reviews and taking into account the arrangements between the Parties and the European Union or in the WTO, the Parties shall decide on possible changes to this chapter.
Chapter 4. Trade In Services
Article 4.1. Trade In Services
1. The Parties reaffirm the rights and obligations between them as provided for in the GATS.
2. The Parties recognise the increasing importance of trade in services in their economies. In their efforts to gradually develop and broaden their co-operation, they shall work together with the aim of creating the most favourable conditions for achieving further liberalisation and additional mutual opening of markets for trade in services.
3. The Parties may jointly review any issues related to measures affecting trade in services in the Joint Committee.
4. The Parties shall negotiate a chapter on Trade in Services, including international maritime transport services, on a mutually advantageous basis, securing an overall balance of rights and obligations, and having due regard to Article V of the GATS. Such negotiation shall take place no later than one year after the entry into force of this Agreement.
Article 4.2. 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, (1) and subject to the requirements of paragraph 3, each Party shall give due consideration to any requests by another Party to recognise the education or experience obtained, requirements met, or licences or certifications granted in that other Party. Such recognition may be based upon an agreement or arrangement with that other Party, or otherwise be accorded autonomously.
For the purpose of this Article and Annex X (Recognition of Qualifications of Service Suppliers), service supplier means any person that supplies, or seeks to supply, a service.
2. Where a Party recognises, by agreement or arrangement, the education or experience obtained, requirements met, or licences or certifications granted, in the territory of a non-party, that Party shall afford another Party adequate opportunity to negotiate its accession to such an agreement or arrangement, whether existing or future, or to negotiate a comparable agreement or arrangement with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for another Party to demonstrate that the education or experience obtained, requirements met, or licences or certifications granted, in the territory of that other Party should also be recognised.
3. A Party shall not accord recognition in a manner which would constitute a means of discrimination between countries 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.
4. Annex X (Recognition of Qualifications of Service Suppliers) sets out further rights and obligations regarding recognition of qualifications of service suppliers of the Parties.
Chapter 5. Investment
Article 5.1. Coverage
This Chapter shall apply to commercial presence in all sectors, with the exception of all services sectors.
Article 5.2. Definitions
1. For the purposes of this Chapter:
(a) juridical person of a Party means a juridical person constituted or otherwise organised under the law of Peru or an EFTA State and engaged in substantive business operations in Peru or in the EFTA State concerned;
(b) natural person means a national of Peru or an EFTA State according to its respective legislation;
(c) commercial presence means any type of business establishment, including through:
(i) the constitution, acquisition or maintenance of a juridical person, or
(ii) the creation or maintenance of a branch or a representative office,
Within the territory of another Party for the purpose of performing an economic activity.
2. As regards natural persons, this Chapter shall not extend to seeking or taking employment in the labour market or confer a right of access to the labour market of another Party.
Article 5.3. National Treatment
With respect to commercial presence, and subject to the reservations set out in Annex XI (Reservations), each Party shall grant to juridical and natural persons of another Party, and to the commercial presence of such persons, treatment no less favourable than that it accords, in like situations to its own juridical and natural persons.
Article 5.4. Reservations
1. National treatment as provided for under Article 5.3 (National Treatment) shall not apply to:
(a) any reservation that is listed by a Party in Annex XI (Reservations);
(b) an amendment to a reservation covered by subparagraph 1 (a) to the extent that the amendment does not increase the non-conformity of the reservation with Article 5.3 (National Treatment); and
(c) any new reservation adopted by a Party in accordance with paragraph 4, and incorporated into Annex XI (Reservations), provided that such reservation does not affect the overall level of commitments of that Party under this Agreement;
To the extent that such reservation is inconsistent with that Article.
2. As part of the review provided for in Article 5.9 (Review), the Parties undertake to review at least every three years the status of the reservations set out in Annex XI (Reservations) with a view to reducing or removing such reservations.
3. A Party may, at any time, either upon the request of another Party or unilaterally, remove in whole or in part reservations set out in Annex XI (Reservations) by written notification to the other Parties.
4. In case of the adoption of a new reservation, as referred to in subparagraph 1 (c), the Party concerned shall promptly notify the other Parties of the reservation. On receiving such notification, any other Party may request consultations regarding the reservation and related issues. Such consultations shall be entered into without delay.
Article 5.5. Key Personnel
1. Each Party shall, subject to its laws and regulations, grant natural persons of another Party, and key personnel employed by natural or juridical persons of another Party, temporary entry and stay in its territory in order to engage in activities connected with commercial presence, including the provision of advice or technical services.
2. Each Party shall, subject to its laws and regulations, permit natural or juridical persons of another Party, and their commercial presence, to employ, in connection with the commercial presence, any key personnel provided that such personnel has been permitted to enter, stay and work in its territory and that the employment concerned conforms to the terms, conditions and time limits of the permission granted to such key personnel.
3. The Parties shall, subject to their laws and regulations, grant temporary entry and stay and provide any necessary confirming documentation to the spouse and minor children of key personnel who has been granted temporary entry, stay and authorisation to work in accordance with paragraphs 1 and 2. The spouse and minor children shall be admitted for the period of the stay of that person.
Article 5.6. Right to Regulate
Subject to the provisions of this Chapter and Annex XI (Reservations), a Party is not prevented from regulating the commercial presence as set out in subparagraph 1 (c) of Article 5.2 (Definitions).
Article 5.7. Relation to other International Agreements
The provisions of this Chapter shall be applied without prejudice to the rights and obligations of the Parties under other international investment agreements, to which Peru and an EFTA State are parties. It is understood that any dispute settlement mechanism in investment protection agreements, to which Peru and an EFTA State are parties, is not applicable to alleged breaches of this Chapter.
Article 5.8. Exception
The exception in subparagraph (d) of Article XIV of the GATS is hereby incorporated into and made part of this Chapter, mutatis mutandis.
Article 5.9. Review
1. This Chapter shall be subject to periodic reviews in the framework of the Joint Committee regarding the possibility to further develop the Parties commitments.
2. In view of paragraph 4 of Article 4.1 (Trade in Services), the Parties shall aim at consistency, as far as appropriate, with the results of future negotiations on Chapter 4 (Trade in Services), in particular regarding commitments on payments and transfers.
Chapter 6. Protection of Intellectual Property
Article 6.1. General Provisions
1. The Parties shall grant and ensure adequate, effective and non-discriminatory protection of intellectual property rights, and provide for measures for the enforcement of such rights against infringement thereof, counterfeiting and piracy, in accordance with the provisions of this Chapter and the international agreements referred to therein.
2. Each Party shall give effect to the provisions of this Chapter and may, but shall not be obliged to, implement in the national legislation more extensive protection than is required by this Chapter, provided that such protection does not contravene the provisions of this Chapter.
3. The Parties shall accord to the nationals of the other Parties treatment no less favourable than that they accord to their own nationals with regard to the protection 1 of intellectual property, subject to the exceptions provided in Articles 3 and 5 of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (hereinafter referred to as the TRIPS Agreement).
4. With regard to the protection (1) of intellectual property, any advantage, favour, privilege or immunity granted by a Party to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of the other Parties, subject to the exceptions provided in Articles 4 and 5 of the TRIPS Agreement.
5. In accordance with paragraph 2 of Article 8 of the TRIPS Agreement, Parties may take appropriate measures, provided that they are consistent with the provisions of this Agreement, if needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.
For the purposes of paragraphs 3 and 4, protection shall include matters affecting the availability, acquisition, scope, maintenance and enforcement of intellectual property rights as well as those matters affecting the use of intellectual property rights specifically addressed in this Chapter.
Article 6.2. Basic Principles
1. In accordance with Article 7 of the TRIPS Agreement, the Parties recognise that the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.
2. The Parties recognise that technology transfer contributes to strengthen national capabilities with the aim to establish a sound and viable technological base.
3. The Parties recognise the impact of information and communication technologies on the creation and usage of literary and artistic works.
4. In accordance with paragraph 1 of Article 8 of the TRIPS Agreement, the Parties may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Chapter.
5. The Parties recognise the principles established in the Declaration on the TRIPS Agreement and Public Health, adopted on 14 November 2001 by the WTO at its Fourth Ministerial Meeting, held in Doha, Qatar, and the Decision of WTOs General Council on the Implementation of Paragraph 6 of the Doha Declaration, adopted on 30 August 2003 and the Amendment of the TRIPS Agreement adopted by the General Council of the WTO on 6 December 2005.
Article 6.3. Definition of Intellectual Property
For the purposes of this Agreement, intellectual property refers to all categories of intellectual property that are the subject of Articles 6.6 (Trademarks) to 6.11 (Undisclosed Information and Measures Related to Certain Regulated Products).
Article 6.4. International Conventions
1. Without prejudice of the rights and obligations contained in this Chapter, the Parties reaffirm their existing rights and obligations, including the right to apply the exceptions and to make use of the flexibilities, under the TRIPS Agreement and under any other multilateral agreement related to intellectual property and agreements administered under the auspices of the World Intellectual Property Organization (hereinafter referred to as the WIPO) to which they are parties, in particular the following:
(a) Paris Convention of 20 March 1883 for the Protection of Industrial Property (Stockholm Act, 1967, hereinafter referred to as the Paris Convention);
(b) Berne Convention of 9 September 1886 for the Protection of Literary and Artistic Works (Paris Act, 1971); and
(c) International Convention of 26 October 1961 for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (Rome Convention).
2. The Parties to this Agreement which are not a party to one or more of the agreements listed below shall ratify or accede to the following multilateral agreements upon entry into force of this Agreement:
(a) Budapest Treaty of 28 April 1977 on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure;
(b) International Convention for the Protection of New Varieties of Plants 1978 (1978 UPOV Convention), or the International Convention for the Protection of New Varieties of Plants 1991 (1991 UPOV Convention); and
(c) Patent Cooperation Treaty of 19 June 1970 (Washington Act, amended in 1979 and modified in 1984).
3. The Parties to this Agreement which are not a party to one or more of the agreements listed below shall ratify or accede to the following multilateral agreements within one year from the date of entry into force of this Agreement:
(a) WIPO Performances and Phonograms Treaty of 20 December 1996 (WPPT); and
(b) WIPO Copyright Treaty of 20 December 1996 (WCT).
4. The Parties will carry out as soon as possible the necessary actions to submit to the Parties competent national authorities the adherence to the Geneva Act (1999) of the Hague Agreement concerning the International Registration of Industrial Designs, and to Protocol of 27 June 1989 Relating to the Madrid Agreement concerning the International Registration of Marks for their consideration.
5. The Parties to this Agreement may agree, upon mutual consent, to have an exchange of views of experts on activities relating to existing or future international conventions on intellectual property rights and on any other matter related to intellectual property rights as the Parties may agree upon.
Article 6.5. Measures Related to Biodiversity
1. The Parties reaffirm their sovereign rights over their natural resources and recognise their rights and obligations under the Convention on Biological Diversity with respect to access to genetic resources and to the fair and equitable sharing of benefits arising out of the utilisation of these genetic resources.
2. The Parties recognise the importance and the value of their biological diversity and of the associated traditional knowledge, innovations and practices of indigenous and local communities. Each Party shall determine the access conditions to its genetic resources in accordance with the principles and provisions contained in applicable national and international law.
3. The Parties recognise past, present and future contributions of indigenous and local communities and their knowledge, innovations and practices to the conservation and sustainable use of biological and genetic resources and in general the contribution of the traditional knowledge of their indigenous and local communities to the culture and economic and social development of nations.
4. The Parties shall consider collaborating in cases regarding non compliance with the applicable legal provisions on access to genetic resources and traditional knowledge, innovations and practices.
5. According to their national law, the Parties shall require that patent applications contain a declaration of the origin or source of a genetic resource, to which the inventor or the patent applicant has had access. As far as provided in their national legislation, the Parties will also require the fulfilment of prior informed consent and they will apply the provisions set out in this Article to traditional knowledge as applicable.
6. The Parties, in accordance with their national laws, shall provide for administrative, civil or criminal sanctions if the inventor or the patent applicant wilfully make a wrongful or misleading declaration of the origin or source. The judge may order the publication of the ruling.
7. If the law of the Party so provides:
(a) access to genetic resources shall be subject to the prior informed consent of the Party providing the genetic resources; and
(b) access to traditional knowledge of indigenous and local communities associated to these resources shall be subject to the approval and involvement of these communities.
8. Each Party shall take policy, legal and administrative measures, with the aim of facilitating the fulfilment of terms and conditions for access established by the Parties for such genetic resources.
9. The Parties affirm and recognise their existing rights and obligations with respect to each other under the International Treaty of Plant Genetic Resources for Food and Agriculture of the Food and Agriculture Organization.
10. The Parties shall take legislative, administrative or policy measures, as appropriate, with the aim of ensuring the fair and equitable sharing of the benefits arising from the use of genetic resources or associated traditional knowledge. Such sharing shall be based on mutually agreed terms.