Article 15.3. Choice of Forum
1. Any dispute arising under this Agreement or under _ the WTO Agreement may be resolved in either forum at the option of the complaining Party.
2. Once the complaining Party has requested the establishment of a Panel under Article 15.6, or a panel under Article 6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes of the WTO, the forum selected shall be exclusive of the other.
Article 15.4. Consultations
1. A Party may request in writing to the other Party consultations with respect to any existing or proposed measure, or any other matter that it considers may affect the application of this Agreement. If a Party requests consultations, the consulted Party shall respond within 10 days of receipt of such request and shall enter into consultations in good faith. In the case of perishable goods, the time limit for responding to the request for consultations shall be 5 days following its receipt.
2. The consulting Party shall deliver the request to the consulted Party and shall explain the reasons for its request, including identification of the measure in force or proposed measure or other matter that it considers could affect the application of this Agreement, as well as an indication of the legal basis for the complaint.
3. The Parties shall make every effort to reach a mutually satisfactory solution. During the consultations, each Party shall:
a) provide sufficient information to permit a full review of the manner in which the existing or proposed measure, or any other matter, may affect the operation and implementation of this Agreement; and
b) shall treat confidential information exchanged in consultations in the same manner as that accorded by the Party that provided the information.
4. Consultations may be held in person or by any technological means available to the Parties. If in person, consultations shall be held in the capital of the consulted Party, unless otherwise agreed by both Parties.
5. In consultations under this Article, the consulting Party may request the consulted Party to make available to it personnel of its governmental agencies or other regulatory bodies having knowledge of the subject matter of the consultations.
6. The consultation period shall not exceed 30 days following the receipt of the request for consultations, unless both Parties decide to modify such period. For perishable goods, the consultation period shall not exceed 15 days following the receipt of the request for consultations, unless both Parties decide to modify such period.
7. If the Party consulted does not respond to the request for consultations or if consultations are not held within the time limits provided for in this Article, the consulting Party may directly request the intervention of the Commission or the establishment of a Panel.
8. Direct consultations and negotiations shall be without prejudice to the rights of the Parties in other fora.
Article 15.5. Intervention of the Administrative Commission
1. If the Parties fail to resolve the matter within the time limit established in Article 15.4, the Party that requested the consultations may request in writing a meeting of the Commission.
2. The consulting Party may also request in writing that the Commission be convened when consultations have been held under Chapters VII (Sanitary and Phytosanitary Measures) and VIII (Technical Barriers to Trade), provided that such consultations have been conducted in accordance with the provisions of Article 15.4.
3. The consulting Party shall notify the other Party of the request, and shall explain the reasons for the request, including identification of the measure in force or proposed measure or other matter at issue, and an indication of the legal basis for the complaint.
4. Unless the Parties decide on a different time limit, the Commission shall meet within 10 days of the delivery of the request and shall endeavor to resolve the dispute as soon as possible. In order to assist the Parties in reaching a mutually satisfactory resolution of the dispute, the Commission may:
a) convene technical advisors or create working groups onthe subject that it deems necessary;
b) use of good offices, conciliation or mediation or other dispute resolution procedures; or
c) formulate recommendations.
5. Unless it decides otherwise, the Commission shall join 2 or more proceedings before it under this Article relating to the same measure or matter. The Commission may join 2 or more proceedings concerning other matters before it under this Article, when it considers it appropriate to examine them jointly.
6. Either Party may request the establishment of a Panel if the Commission fails to resolve the dispute:
a) within 30 days following the meeting referred to in paragraph 4;
b) within 20 days following the meeting referred to in paragraph 4, in the case of perishable products;
c) within 30 days after the Commission has met to deal with the most recent matter submitted to it, when several proceedings have been joined in accordance with paragraph 5; or
d) in any other period agreed upon by the Parties.
Article 15.6. Request for the Establishment of the Panel
1. After the expiration of the time limit for consultations, or if applicable for the meeting of the Commission, either Party may request in writing the establishment of a Panel, identifying the measure or other matter at issue and stating the reasons on which its request is based and the legal basis of the complaint.
2. On the date of receipt of the request, the Panel shall be deemed to be established.
3. Unless the Parties agree otherwise, the Panel shall be composed and perform its functions in accordance with the provisions of this Chapter and the Model Rules of Procedure.
4. The Panel may not be established to review a draft measure.
Article 15.7. List of Panelists
1. No later than 6 months after the entry into force of this Agreement, each Party shall establish and maintain an indicative list of up to 5 domestic individuals who are qualified and willing to serve as panelists in disputes under this Chapter. These lists shall be referred to as the "List of Panelists from Mexico" and the "List of Panelists from Peru". The lists and any amendments thereto shall be immediately communicated to the other Party.
2. No later than 6 months after the entry into force of this Agreement, the Parties shall establish by mutual agreement and maintain an indicative list of 5 individuals who are not nationals of the Parties and who are qualified and willing to serve as panelists. This roster shall be referred to as the "Third Country Panelist Roster". The members of the roster shall be appointed by consensus for 3-year terms and shall be automatically eligible for reappointment unless otherwise agreed by the Parties.
3. The Parties, by mutual agreement, may replace or include panelists in the "List of Third Country Panelists".
4. The Parties may use the tentative lists even if they have not been completed with the number of members established in paragraphs 1 and 2.
Article 15.8. Qualifications of Panel Members
1. All Panel members shall:
a) have specialized knowledge or experience in law, international trade, other matters covered by this Agreement or in the settlement of disputes arising under international trade agreements;
b) be selected strictly on the basis of their objectivity, impartiality, reliability and sound judgment;
c) be independent, not be related to, and not receive instructions from, any of the Parties; and
d) comply with the Code of Conduct approved by the Commission.
2. Individuals who have intervened in the consultations or in the meeting of the Commission in a dispute may not be members of the Panel established to resolve the same dispute.
Article 15.9. Selection of Panel Members
1. The Panel shall be composed of 3 members. The Parties shall apply the following procedures in the selection of the Panel members:
a) within 15 days after the delivery of the request for the establishment of the Panel, each Party shall designate its panelist. If one of the Parties fails to designate a panelist within the period provided above, the Secretary General of LAIA, at the request of any of the Parties, shall designate a panelist within 10 days following such request;
b) the Parties shall designate the third panelist, who shall be the Chairperson of the Panel, within 15 days after the designation or selection of the second panelist. If the Parties fail to reach an agreement on the designation of the Chairperson within the period provided above, the Secretary General of ALADI, at the request of any of the Parties, shall designate the Chairperson within 10 days following such request;
c) the selection made 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 paragraphs 1 and 2 of Article 15.7, as appropriate, or, failing that, shall select them from the indicative list provided for in the Understanding on Rules and Procedures Governing the Settlement of Disputes of the WTO; and
d) each Party to the dispute should endeavor to select panelists who have relevant experience in the subject matter of the dispute.
2. If a Party considers that a panelist is in breach of the Code of Conduct, the Parties to the dispute shall consult and if they agree, the panelist shall be removed and a new panelist shall be appointed in accordance with this Article.
Article 15.10. Rules of Procedure
1. Within 6 months following the entry into force of this Agreement, the Commission shall adopt the Model Rules of Procedure that shall guarantee:
a) the right to at least one hearing before the Panel;
b) the opportunity for each Party to submit opening and rebuttal written submissions; and
c) that all written submissions and communications with the Panel, the hearings before the Panel, the deliberations and the Preliminary Report shall be confidential.
2. Unless otherwise agreed by the Parties, the proceedings before the Panel shall be conducted in accordance with the Model Rules of Procedure.
3. The Commission may amend the Model Rules of Procedure in accordance with the powers set forth in Article 17.2 (Functions of the Administrative Commission).
4. Unless otherwise agreed by the Parties, within 20 days from the date of delivery of the request for the establishment of the Panel, the terms of reference of the Panel shall be:
"Examine, in light of the applicable provisions of the Agreement, the matter submitted in the request for the establishment of the Panel and issue findings, determinations and recommendations as provided in Articles 15.12 and 15.13."
5. If the complaining Party considers that a matter has caused nullification or impairment of benefits, the terms of reference shall so state.
6. Where a Party requests that the Panel make findings on the extent of the adverse trade effects caused by the measure adopted by the other Party, the terms of reference shall so state.
Article 15.11. Powers of the Panel
1. At the request of a Party, or on its own initiative, the Panel may seek such information and technical advice from persons or technical groups as it deems appropriate.
2. The technical or advisory group shall be selected by the Panel from among independent advisors or experts highly qualified in scientific or technical matters, in accordance with the Model Rules of Procedure.
3. Before the Panel requests the advice referred to in paragraph 1, it shall notify the Parties of its intention to request such advice, setting an appropriate time limit for the Parties to make such observations as they deem appropriate.
4. The Panel shall notify the Parties of any information or advice referred to in paragraph 1, setting a time limit for the Parties to comment.
5. If the Panel takes into account the information or advice requested under paragraph 1 in preparing its report, it shall also take into account all observations and comments made by the Parties in this regard.
Article 15.12. Preliminary Report
1. The Panel shall base its Preliminary Report on the relevant provisions of this Agreement, the arguments and submissions made by the Parties and any information it has received pursuant to Article 15.11.
2. Unless otherwise agreed by the Parties, within 90 days of the appointment of the last panelist, and in the case of perishable goods within 45 days, the Panel shall submit to the Parties a Preliminary Report containing:
a) findings of fact, including any arising from a request pursuant to paragraph 6 of Article 15.10;
b) a determination as to whether the measure in question is or may be inconsistent with the obligations under this Agreement, or is cause for nullification or impairment within the meaning of the Annex to Article 15.2, or any other determination requested in the terms of reference; and
c) its recommendations, if any, for the resolution of the dispute.
3. The panelists may formulate individual votes on questions on which there is no unanimous decision.
4. The Parties may make comments or request clarifications in writing to the Panel on the Preliminary Report within 15 days of its submission.
5. In this case and after examining the written observations, the Panel may, on its own motion or at the request of any Party:
a) conduct any due diligence it deems appropriate; and
b) reconsider or correct its Preliminary Report.
Article 15.13. Final Report
1. Unless the Parties agree otherwise, the Panel shall base its Final Report on the relevant provisions of this Agreement, the submissions and arguments of the Parties, any information submitted to it pursuant to Article 15.11, and the observations submitted by the Parties pursuant to Article 15.12.
2. If either Party so requests, the Panel may make recommendations to implement its decision.
3. Unless otherwise agreed by the Parties, within 120 days after the selection of the last member of the Panel, and 80 days in the case of perishable goods, the Panel shall submit to the Parties a Final Report and, if applicable, the individual votes on the issues on which there has not been a unanimous decision. Such report shall contain:
a) findings of fact and conclusions of law;
b) its determination as to whether a Party is in breach of its obligations under this Agreement, or has caused nullification or impairment within the meaning of the Annex to Article 15.2 or any other determination requested in the terms of reference;
c) its recommendations for the implementation of its decision, if requested by either Party; and
d) if requested, its findings regarding the extent of the adverse trade effects caused by the measure imposed by the Party that failed to comply with its obligations under this Agreement, or by the measure that has caused nullification or impairment within the meaning of the Annex to Article 15.2.
4. The Final Report shall be adopted by consensus or, failing that, by the majority of the members of the Panel. The Final Report may be subject to corrections or clarifications of form, in accordance with paragraph 6 of this Article.
5. No Panel may disclose the identity of panelists who voted with the majority or minority.
6. The Parties may request in writing to the Panel only formal corrections or clarifications to the Final Report within 10 days of the submission of the Final Report. The Panel shall respond to such request within 20 days after its presentation, sending, when appropriate, the clarifications and the corrected version of the report that will constitute the Final Report.
7. The Final Report of the Panel shall be published within 15 days of its communication to the Parties, unless both Parties decide otherwise and subject to the protection of confidential information.
Article 15.14. Compliance with the Final Report
1. Upon notification of the Final Report of the Panel pursuant to paragraph 3 of Article 15.13, the Parties may agree on a settlement of the dispute, which shall normally conform to the findings and recommendations, if any, of the Panel.
2. If in its Final Report the Panel determines that a Party's measure is inconsistent with its obligations under this Agreement, or has caused nullification or impairment within the meaning of the Annex to Article 15.2, the remedy shall be to repeal, modify or refrain from implementing the measure found to be inconsistent or to have caused nullification or impairment in accordance with the provisions of this Agreement, unless the Parties agree otherwise.
Article 15.15. Non-compliance - Suspension of Benefits
1. If the Panel has made a determination under paragraph 2 of Article 15.14, and the Party complained against has failed to comply, or the Parties are unable to agree on a solution under paragraph 1 of Article 15.14, the Parties may enter into negotiations with a view to establishing mutually acceptable compensation.
2. The complaining Party may suspend the application of benefits of equivalent effect to the Party complained against, if after 30 days from the notification of the Final Report of the Panel, the Parties:
a) do not agree to compensation; or
b) have agreed to a solution under Article 15.14(1) and the complaining Party considers that the Party complained against has not complied with the terms of such agreement.
3. The complaining Party shall notify the Party complained against and the Commission in writing of its decision, specifying the sector and level of benefits to be suspended.
4. The suspension of benefits shall last until the Party complained against complies with the Final Report of the Panel or until the Parties reach a mutually satisfactory agreement on the dispute, as the case may be.
5. In considering the benefits to be suspended pursuant to paragraph 2, the complaining Party:
a) first seek to suspend benefits within the same sector or sectors that are affected by the measure, or by any other matter that the Panel has found to be inconsistent with the obligations under this Agreement, or that has caused nullification or impairment within the meaning of the Annex to Article 15.2; and
b) may suspend benefits in other sectors when it considers that it is unfeasible or inefficient to suspend benefits in the same sector or sectors.
6. At the written request of either Party, and after notice to the other Party, a Panel shall be established to determine whether the level of benefits suspended by the complaining Party pursuant to paragraph 2 is manifestly excessive.
7. The proceeding before the Panel constituted pursuant to paragraph 6 shall be conducted in accordance with the Model Rules of Procedure. The Panel shall render its findings within 60 days of the composition of the Panel, or within such other period as the Parties may agree.
Article 15.16. Compliance Review
1. Notwithstanding the provisions of paragraph 2 of Article 15.15, the Party complained against may refer the matter to the Panel, upon written notice to the other Party, if there is disagreement with the other Party regarding compliance:
a) of the Panel's recommendations and determinations; or
b) of the agreement referred to in paragraph 1 of Article 15.14.
2. The proceeding before the Panel constituted for the purposes of this Article shall be conducted in accordance with the Model Rules of Procedure. The Panel shall render its findings within 60 days of the composition of the Panel or within such other period as the Parties may agree.
3. If the Panel concludes that the Party complained against has eliminated the nonconformity, has complied with the Panel's recommendations or has complied with the agreement referred to in paragraph 1(b), the complaining Party shall promptly remove the suspension of benefits it has adopted.
Section B. Internal Procedures
Article 15.17. Proceedings Before Internal Judicial and Administrative Authorities
1. When a question of interpretation or application of this Agreement arises in an internal judicial or administrative proceeding of a Party, or when a court or administrative body requests the opinion of a Party, that Party shall notify the other Party. The Commission shall endeavor, as soon as possible, to agree on an appropriate response.
2. The Party in whose territory the court or administrative body is located shall submit to the latter any interpretation agreed upon by the Commission.
3. When the Commission is unable to reach an agreement, either Party may submit its own opinion to the tribunal or administrative body.
Annex to Article 15.2 . Nullification and impairment
A Party may have recourse to the dispute settlement mechanism of this Chapter when, by virtue of the application of a measure that does not contravene the Agreement, it considers that the benefits that it could reasonably have expected to receive from the application of the following Chapters are nullified or impaired:
1. Chapter III Market Access.
2. Chapter IV Rules of Origin and Origin-Related Procedures.
3. Chapter VII Sanitary and Phytosanitary Measures.
4. Chapter VIII Technical Barriers to Trade.
5. Chapter X Cross-border Trade In Services.
Chapter XVI. TRANSPARENCY
Article 16.1. Definition
For the purposes of this Chapter, the following definitions shall apply:
administrative ruling of general application: an administrative ruling or interpretation that applies to all persons and facts generally within its scope and that establishes a rule of conduct, but does not include:
a) a determination or ruling made in an administrative proceeding that applies to particular persons, goods or services of the other Party, ina specific case; or
b) a resolution deciding on a particular act or practice.
Article 16.2. Point of Contact
1. Each Party shall designate a unit or office as a point of contact to facilitate communication between the Parties on any matter covered by this Agreement.
2. When requested by a Party, the contact point of the other Party shall indicate the official responsible for the matter and provide such support as may be required to facilitate communication with the requesting Party.
Article 16.3. Publication
1. Each Party shall ensure that its laws, regulations, procedures and administrative rulings of general application that relate to any matter covered by this Agreement are promptly published or made available for the information of the Parties and any interested party.
2. To the extent practicable, each Party shall publish in advance any measure it proposes to adopt that relates to any matter connected with this Agreement, and shall provide the other Party with a reasonable opportunity to request information and comment on the proposed measures.
Article 16.4. Notification and Provision of Information
1. Each Party shall, to the extent possible, notify the other Party of any measure in force that the Party considers may substantially affect or affect the interests of that other Party under the terms of this Agreement.
2. Each Party shall, upon request of the other Party, provide information and promptly respond to requests for information from that other Party on any measure in force relating to this Agreement, whether or not that other Party has previously been notified of that measure.
3. The notification or provision of information referred to in this Article shall be made without prejudice to whether or not the measure is compatible with this Agreement.
4. Where a Party provides information of a confidential nature to the other Party pursuant to this Agreement, the other Party shall maintain the confidentiality of such information.
Article 16.5. Administrative Procedures
In order to administer in a consistent, impartial, and reasonable manner all measures of general application affecting matters covered by this Agreement, each Party shall ensure that, in its administrative procedures applying the measures referred to in Article 16.3 with respect to persons, goods, or services:
a) whenever possible, persons of the other Party who are directly affected by a proceeding shall, in accordance with domestic provisions, be given reasonable notice of the commencement of the proceeding, including a description of its nature, a statement of the legal basis under which the proceeding is initiated and a general description of all issues in dispute;
b) where time, the nature of the proceeding and the public interest permit, persons of the other Party are afforded a reasonable opportunity to present facts and arguments in support of their claims prior to any final administrative action; and
c) comply with the national legislation of that Party.
Article 16.6. Review and Challenge
1. Each Party shall establish or maintain courts or tribunals or procedures of a judicial or administrative nature for the purpose of the prompt review and, where warranted, correction of final administrative actions relating to matters covered by this Agreement. Such tribunals shall be impartial and not connected with the administrative enforcement agency or authority, and shall have no substantial interest in the outcome of the matter.
2. Each Party shall ensure that, before such courts or in such proceedings, persons have the right to: