2. The competent authority of the importing Party shall communicate to the competent authority of the exporting Party the determination of origin within 30 days of its issuance. In the event that the competent authority of the exporting Party deems it necessary to have additional information in relation to the origin verification procedure, it may request such information from the competent authority of the importing Party, indicating the reason for such request.
3. If the competent authority of the importing Party does not issue a determination of origin within the period mentioned in paragraph 1, the preferential tariff treatment shall be accepted and the measures adopted to guarantee the fiscal interest shall be lifted within a maximum period of 90 days following the importer's request for release of the measures to the customs authority of the importing Party, which may be extended for up to 30 additional days in duly substantiated exceptional cases.
4. If as a result of the verification of origin:
a) If the originating status of the merchandise is recognized, the importing Party shall proceed to accept the request for preferential tariff treatment and to lift the measures adopted to guarantee the fiscal interest within a maximum period of 90 days following the request for release of the measures by the importer to the customs authority of the importing Party, which may be extended for up to 30 additional days in duly substantiated exceptional cases.
b) If the originating status of the good is unknown, the importing Party shall deny the request for preferential tariff treatment and shall proceed to execute the measures it has adopted in order to guarantee the fiscal interest. In addition, the importing Party shall apply the penalties that may be applicable, in accordance with this Chapter and its domestic legislation.
5. The importing Party shall not apply a determination that a good is non- originating, made under paragraph 4(b), to an importation made before the date on which such determination takes effect, provided that:
a) the importing Party has determined that the good does not qualify as originating according to the tariff classification or value applied by such Party to one or more materials used in the production of such good because they differ from the tariff classification or value applied to the materials on the basis of an advance ruling issued under Article 4.36 by the Party from whose territory the good has been exported; and
b) the aforementioned advance ruling is prior to the notification of the determination.
Article 4.30. Suspension of Preferential Tariff Treatment of Identical Goods
1. When, as a result of the origin verification procedures carried out by the competent authority of the importing Party, the latter becomes aware that a producer or exporter has submitted, on at least two occasions, false or unfounded false declarations with respect to identical goods that such producer or exporter has certified as originating, the importing Party may suspend the preferential tariff treatment applicable to identical goods that such producer or exporter certifies as originating, until such producer or exporter certifies to the competent authority of the importing Party that its goods qualify as originating under the terms of this Chapter.
2. The suspension of preferential tariff treatment shall be communicated by the competent authority of the importing Party, both to the competent authority of the exporting Party and to the exporter or producer concerned, stating the findings of fact and the legal basis justifying its determination.
Article 4.31. Tariff Refunds
1. In the event that an importer has not requested preferential tariff treatment for an originating good at the time of importation, he may request, within a period not to exceed 365 days following the date of importation, the refund of duties paid in excess, provided that the request is accompanied by:
a) a written declaration stating that the merchandise qualified as originating at the time of importation;
b) acopy of the certificate of origin; and
c) any other documentation related to the importation of the good, as required by the competent authority of the importing Party.
2. Goods may be subject to procedures for requesting information or verification of origin in accordance with Articles 4.26, 4.27 and 4.28.
Article 4.32. Exchange of Information and Confidentiality
1. The Parties shall exchange in a prompt and timely manner information related to the origin of goods and information concerning the prevention, investigation and punishment of customs offenses and infringements related to the origin of goods.
2. Each Party shall, in accordance with its domestic law, maintain the confidentiality of information obtained under this Chapter and protect it from disclosure that would prejudice the competitive position of the person providing the information.
Article 4.33. Exchange of Information on Customs Matters
1. At the request of a Party, information that may assist in determining whether imports or exports from or to the other Party are in compliance with its customs laws and regulations shall be exchanged promptly and in a timely manner, subject to the confidentiality rules provided for in the national legislation of each Party.
2. For the purposes of the preceding paragraph, the Parties shall seek to implement mechanisms for the electronic exchange of information.
Article 4.34. Sanctions
Each Party shall establish or maintain criminal, civil or administrative penalties for violations related to this Chapter, in accordance with its laws and regulations.
Article 4.35. Means of Challenging Administrative Actions
Each Party shall ensure, with respect to its administrative acts relating to matters covered by this Chapter, that importers, exporters or producers have access to:
a) a level of administrative review independent of the official or unit that issued the administrative act; and
b) a level of judicial review of the administrative act issued in the final administrative instance.
Article 4.36. Advance Rulings
1. Each Party shall expeditiously issue advance written rulings prior to the importation of a good into its territory. Advance rulings shall be issued by the importing Party upon written request of an importer in its territory, or of an exporter or producer in the territory of the other Party, based on the facts and circumstances stated by them, in relation to:
a) tariff classification;
b) whether a good qualifies as originating under this Chapter;
c) the application of customs valuation criteria, in accordance with the Customs Valuation Agreement; and
d) such other matters as the Parties may agree.
2. Each Party shall adopt or maintain procedures for the issuance of advance rulings, including:
a) information reasonably required to process the request;
b) the authority's power to request additional information from the applicant during the application evaluation process; and
c) the obligation of the authority to issue the advance ruling in a complete, founded and motivated manner.
3. Each Party shall issue an advance ruling in accordance with the time period established in its domestic law, which may not exceed 150 days from the date on which the authority has obtained all necessary information from the person who has requested the advance ruling. In issuing the advance ruling, the Party shall take into account the facts and circumstances presented by the applicant.
4. The advance ruling shall be effective as of the date of its issuance or other date specified in the ruling, provided that the facts or circumstances on which it is based have not changed. 5. An_ advance ruling may be modified or revoked by the Party issuing the ruling after the Party notifies the applicant and shall take effect upon such notification. However, the Party issuing the ruling may retroactively modify or revoke the advance ruling only if the person to whom it was issued has submitted incorrect or false information. 6. The advance ruling may be modified or revoked in the following cases:
a) when the advance ruling was based on an error:
i) in fact;
ii) in the tariff classification of the good or materials that are the subject of the determination; or
iii) in the application of the regional value content under this Chapter;
b) where the ruling is not in accordance with an interpretation that the Parties have agreed upon with respect to this Chapter;
c) when the circumstances or facts on which it is based change; or
d) in order to comply with an administrative or judicial decision or to conform to a change in the domestic law of the Party that has issued the advance ruling.
7. Subject to confidentiality requirements under its domestic law, each Party shall make its advance rulings publicly available.
8. If an applicant provides false information or omits relevant facts or circumstances related to the advance ruling, or fails to act in accordance with the terms and conditions of the ruling, the Parties, pursuant to Articles 4.32 and 4.33, may exchange information in order to apply appropriate measures, including civil, criminal and administrative actions, monetary or other sanctions.
9. The holder of an advance ruling may use it only as long as the facts and circumstances that served as the basis for its issuance are maintained. In this case, the holder of the ruling may submit the information necessary for the issuing authority to proceed in accordance with the provisions of paragraph 6.
10. No advance ruling shall be issued on goods subject to a procedure of request for information or verification of origin or to any instance of review or challenge in the territory of any of the Parties.
Section 4.37. Short Supply Committee
1. The Parties establish the Committee on Short Supply (CSC), in order to evaluate the inability of a producer to dispose in the territory of the Parties, in commercial quantities and in a timely manner, in whole or in part, of certain materials classified in Chapters 50 to 63 of the Harmonized System, and if necessary, to allow their temporary or indefinite importation from third countries.
2. The CSC shall agree on rules of procedure no later than 1 year after the entry into force of this Agreement. These regulations shall include the CSC's operating procedures rules and the conditions for assessing the inability to dispose of the materials mentioned in paragraph 1.
3. The Commission shall adopt the regulations referred to in paragraph 2, as well as the resolutions of the CSC.
4. The CEA will have a term of 10 years, which may be extended by decision of the Commission.
Article 4.38. Committee on Rules of Origin and Origin-Related Procedures
1. The Committee on Rules of Origin and Origin-Related Procedures shall have the following functions:
a) cooperate in the application of this Chapter;
b) to adapt the Annex to Article 4.2, in accordance with the modifications and updates of the Harmonized System;
c) at the request of either Party, consider proposals for modifications to the specific rules of origin in the Annex to Article 4.2, duly substantiated, that are due to changes in production processes or other matters related to the determination of the origin of a good;
d) reach agreements, to the extent possible, on: i) tariff classification and customs valuation issues;
ii) modifications to the format of the certificate of originreferred to in Article 4.18; and
iii) the uniform interpretation, application and administration of this Chapter;
e) propose to the Commission the adjustments to this Chapter, including the adoption of the agreements provided for in subsection (d) (ii) and (iii); and
f) examine proposals for administrative or operational changes in customs matters that may affect the flow of trade between the territories of the Parties.
2. The Parties recognize the importance of trade facilitation in the commercial exchange between the Parties, considering it as an indispensable element for the correct implementation and application of this Chapter. Consequently, the Committee on Rules of Origin and Origin-Related Procedures shall seek to eliminate unjustified obstacles or delays generated in the territory of the Parties, which hinder import or export trade operations, to the detriment of commercial operators.
3. For the purposes of paragraph 2, the Committee shall submit to the Commission proposals for implementing customs procedures that result in direct benefits to customs users, such as improving clearance times and risk assessment techniques.
Chapter V. RECOGNITION AND PROTECTION OF APPELLATIONS OF ORIGIN
Article 5.1. Confirmation of WTO Rights and Obligations
The provisions contained in Article 23 of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights shall be applicable to the appellations of origin referred to in the following article.
Article 5.2. Recognition and Protection of Appellations of Origin
1. Peru recognizes the appellation of origin "Tequila" for its exclusive use in products originating in Mexico. Consequently, the importation, manufacture or sale of products under the appellation of origin "Tequila" will not be allowed in Peru, unless they have been produced and certified in Mexico, in accordance with the laws, regulations and standards of Mexico applicable to such products.
2. Mexico recognizes the appellation of origin "Pisco" for its exclusive use in products originating in Peru. Consequently, in Mexico, the importation, manufacture or sale of products under such appellation of origin shall not be allowed, unless they have been produced and certified in Peru, in accordance with the Peruvian legislation applicable to such products. The recognition provided for in this paragraph is without prejudice to the rights that Mexico has recognized, exclusively, in the matter of appellations of origin, in other trade agreements previously signed with other countries.
3. The Parties, by mutual agreement, may extend the agreed protection to other appellations of origin of the Parties. To this effect, one Party shall notify the other Party of the new appellations protected under its national legislation. The inclusion of such appellations of origin shall be made effective by decisions adopted by the Commission within a period not exceeding 4 months from the date of notification by one Party to the other.
Chapter VI. SAFEGUARD CLAUSES
Article 6.1. Definitions
For the purposes of this Chapter, the following definitions shall apply:
threat of serious injury: the clear imminence of serious injury. A determination of the existence of a threat of serious injury shall be based on facts and not merely on allegation, conjecture or remote possibility;
competent investigating authority:
a) in the case of Mexico, the Ministry of Economy or its successor; and
b) in the case of Peru, the Instituto Nacional de Defensa de la Competencia y de la Protección de la Propiedad Intelectual or its successor (for global safeguard measures); and the Ministerio de Comercio Exterior y Turismo or its successor (for bilateral safeguard measures);
serious injury: a general and significant impairment of the situation of a particular domestic industry;
directly competitive merchandise: merchandise that is not similar to the imported merchandise with which it is compared, but is essentially equivalent for commercial purposes because it is intended for the same use and is interchangeable with the imported merchandise;
like product: a good identical to the imported good with which it is compared or that which, although not the same in all its aspects as the imported good with which it is compared, possesses similar or similar characteristics and composition, which allows it to fulfill the same functions; official dissemination bodies:
a) in the case of Mexico, the Diario Oficial de la Federación; and
b) in the case of Peru, the Official Gazette El Peruano;
transition period: the period of relief applicable to each good as provided for in the Tariff Elimination Program, plus 3 years; and
domestic industry: the producers as a whole of the like or directly competitive merchandise operating within the territory of a Party, or those whose collective production of the like or directly competitive merchandise constitutes a major proportion of the total domestic production of such merchandise in a Party.
Section A. Global Safeguard Measures
Article 6.2. Global Safeguard Measures
1. The Parties retain their rights and obligations to apply global safeguard measures under Article XIX of GATT 1994 and the WTO Agreement on Safeguards, except as provided in Article 6.3.
2. No Party shall apply, with respect to the same good and during the same period:
a) a bilateral safeguard measure; and
b) a safeguard measure under Article XIX of GATT 1994 and the WTO Agreement on Safeguards.
Article 6.3. Criteria for Excluding Imports Originating In a Party from a Global Safeguard Measure
1. When a Party decides to adopt a global safeguard measure, it may apply it only to goods originating in the other Party when it determines that imports of such goods represent a substantial part of total imports, and contribute significantly to the growth of imports that caused the serious injury or threat of serious injury.
2. Imports of goods from the other Party shall be considered to be substantial if, during the 3 years immediately preceding the initiation of the investigation, they are included in the imports of the 5 principal supplier countries of that good in the importing Party.
3. Imports of goods of the other Party shall not be considered to contribute significantly to the growth of imports that caused the serious injury or threat of serious injury if their share of the absolute growth in the volume of imports during the period in which the increase in imports occurred is substantially less than the share of the other supplying countries in that period.
4. The Party applying the global safeguard measure from which a good of the other Party was initially excluded shall have the right to subsequently include it when the competent investigating authority determines that a significant increase in imports of such good substantially reduces the effectiveness of the measure, in such a way as to limit the actual or potential growth of the domestic industry in the domestic market.
Section B. Bilateral Safeguard Measures
Article 6.4. Bilateral Safeguard Measures
1. After investigation, the Parties may apply, on an exceptional basis and in accordance with the conditions set out in this Chapter, bilateral safeguard measures to imports of a good originating in the other Party, if as a result of the tariff reduction or elimination provided for in this Agreement, imports of such good increase in absolute terms and in relation to domestic production, and under conditions such as to cause or threaten to cause serious injury to the domestic industry of like or directly competitive goods.
2. Bilateral safeguard measures applied pursuant to this Chapter may consist of the temporary suspension of further reductions in the customs tariff as provided for in Chapter III (Market Access) or increase the customs tariff to a level that may not exceed the lesser of:
a) the most-favored-nation (MFN) tariff rate for that good on the date of adoption of the bilateral measure; or
b) the MFN customs duty applied to that good on the day immediately prior to the entry into force of this Agreement.
3. The Parties shall apply bilateral safeguards only to the extent necessary to prevent or remedy serious injury and to facilitate adjustment of the domestic industry.
4. Without prejudice to the provisions of the preceding paragraphs, the preference applicable at the time of the adoption of the bilateral safeguard measure shall be maintained for a quota of imports which shall be the average of the imports made in the 3 full years or 36 months immediately preceding the period in which the existence of serious injury or threat of serious injury was determined, unless clear justification is given of the need to set a different level to prevent or remedy serious injury.
5. At the end of the period of application of the bilateral safeguard measure, the Party that has adopted it shall:
a) apply the applicable customs duty under the Tariff Elimination Program as if the bilateral safeguard measure had not been applied; or
b) apply the preferential customs tariff in effect at the time of the imposition of the bilateral safeguard measure, rescheduling the tariff elimination in equal annual stages, to conclude on the date initially set for the elimination of the tariff under the Tariff Elimination Program.
6. The bilateral safeguard measure shall have an initial maximum duration of 2 years, which may be extended for up to 1 year when it is determined, in accordance with the provisions of this Chapter, that it continues to be necessary to remedy serious injury or threat of serious injury and that there is evidence that the domestic industry is in the process of adjustment. The total period of application of the bilateral safeguard measure, including its extension, shall not exceed 3 years.
7. The Parties shall not apply a bilateral safeguard measure more than once to a particular good originating in the other Party, unless a period equal to the total duration of the measure initially applied, including its extension, has elapsed.
8. No bilateral safeguard measure shall be applied or maintained after the end of the transition period, except with the consent of the Party against whose good the measure was taken.
Article 6.5. Procedures Relating to the Application of Bilateral Safeguard Measures
1. Each Party shall ensure the uniform, impartial, transparent, equitable and reasonable application of the provisions of a procedure for the adoption of bilateral safeguard measures under this Chapter.
2. Proceedings for the adoption of bilateral safeguard measures may be initiated ex officio or by petition filed with the competent investigating authorities by companies or entities representing the domestic industry (hereinafter "the petitioner"), which produce at least 25 percent of the total domestic production of a like or directly competitive good of the imported good.
3. When a proceeding is initiated ex officio, the initiation determination must be duly supported by sufficient evidence to determine that the increase in imported goods subject to tariff preferences has caused or threatens to cause serious injury to the domestic industry.
4. When a proceeding is initiated by an application filed with the competent investigating authorities, the applicant shall provide the following information indicating its sources or, to the extent that the information is not available, its best estimates and the basis for them:
a) detailed description of the good that is the subject of the application and its similar or directly competing goods, tariff classification, applied tariff, characteristics and uses, as well as a brief description of the production process;
b) data on their representativeness:
i) the names and addresses of the person or persons submitting the request, as well as the identification of the main establishments where the merchandise in question is produced; and
ii) the value and/or volume of the production of the like or directly competitive merchandise produced by the petitioner and the percentage that such production represents in relation to the total national production, as well as the reasons that lead it to affirm that it is representative of the national production;
data for at least the 36 available months closest to the date of submission of the application, relating to:
i) imports of the investigated merchandise (volume, price and country of origin), both in absolute terms and inrelation to total imports;
ii) total domestic production of the like or directly competitive merchandise (volume); and
iii) evidence that allows evaluating the existence of serious injury or threat of serious injury caused by the imports of the merchandise subject of the request, such as the description of the serious injury or threat of serious injury; the information regarding production, sales in the domestic and export market, installed and used capacity, productivity, employment, inventories, losses or profits, related to the domestic industry; the prices of the national merchandise and the imported merchandise at the same level of commercialization within the market of the importing Party, that allows making a reasonable comparison; and any other information that supports the request for the application of the bilateral safeguard measure;
d) enumeration and description of the alleged causes of serious injury or threat of serious injury, and the substantiation that the increase in imports of such merchandise, either in absolute terms or relative to domestic production, is the cause of serious injury or threat of serious injury, supported by relevant information;
e) description of the actions to be taken in order to adjust the competitive conditions of the domestic industry; and
f) identification and justification of the confidential information, and a non-confidential summary thereof; if it is indicated that such information cannot be summarized, a statement of the reasons why it is not possible to do so.
5. If the application complies with all the requirements set forth in this Article, the competent investigating authority shall initiate the investigation after having carefully assessed the accuracy and relevance of the evidence provided with the application and whether there is sufficient evidence to justify the initiation of the proceeding.
6. For purposes of determining serious injury or threat of serious injury, the competent investigating authority shall analyze, inter alia, information regarding the rate and amount of increase in imports of the subject merchandise in absolute and relative terms; the proportion of the domestic market covered by increased imports; and changes in the levels of sales, production, productivity, capacity utilization, exports, prices and inventories, profits or losses, and employment. None of these factors in isolation, nor several of them taken together, will necessarily be sufficient to provide decisive guidance.
7. The competent investigating authority shall not make an affirmative determination of serious injury or threat thereof unless its investigation demonstrates, on the basis of objective evidence, the existence of a clear causal link between increased imports from the other Party and serious injury or threat thereof.
8. Where factors other than the increase in imports from the other Party are at the same time causing or threatening to cause serious injury to the domestic industry, such injury shall not be attributed to the increase in imports.
9. The final determination of the investigations on the application of bilateral safeguard measures shall be issued and made public within 1 year from the initiation of the proceeding and, in exceptional circumstances that are duly justified by the competent authority and made known to the accredited interested parties, within 18 months.
10. During the investigation the competent investigating authority shall collect, receive, examine and, if necessary, verify relevant information, hold a public hearing, and give all accredited interested parties an opportunity to prepare and present their arguments.
Article 6.6. Publications and Notifications
1. The Parties shall publish in their official organs of diffusion the resolutions issued by the competent authority indicated below:
a) initiations, those that determine the imposition of provisional or definitive measures, those that terminate the proceeding, and those that terminate the proceeding without imposing them and those extending a measure; and
b) those that, once an investigation has been initiated, accept the withdrawal of the applicants.
2. The competent investigating authority:
a) shall notify in writing any determination referred to in paragraph 1, within 5 days after its publication, to the competent investigating authority and the diplomatic mission of the other Party and shall attach a copy of the relevant determination and/or report containing the elements of fact and law supporting the respective determination;
b) in the case of the determination of initiation, it shall send with the notification a copy of the public version of the request for initiation of the investigation and its annexes, as well as the questionnaires used by each Party and made available to the parties showing interest in the investigation; and
c) In all cases, notifications must include the name, address, e-mail address, telephone number and fax number of the office where additional information may be obtained, consultations may be made and access to the public version of the file that is the subject of the investigation may be obtained.
3. During any stage of the procedure, the notified Party may request such additional information as it deems necessary from the other Party.
Article 6.7. Deadlines
1. The competent investigating authority of each Party shall grant the interested parties a period of no less than 30 days, counted from the initiation of the investigation, to submit their responses to the questionnaires referred to in the preceding article.
2. In the event that the competent investigating authority imposes a provisional measure, it shall grant a term of not less than 30 days as from the publication of the preliminary determination, in order for the interested parties to state what is in their best interest.