3. For the purposes of this Article, dispute settlement proceedings under the WTO Agreement are deemed to be initiated by a Party's request for the establishment of a panel pursuant to Article 6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes.
4. Before a Party initiates dispute settlement proceedings under the WTO Agreement against another Party or Parties, that Party shall notify all other Parties of its intention.
Article 165. Good Offices, Conciliation or Mediation
1. Good offices, conciliation and mediation are procedures that are undertaken voluntarily if the Parties involved so agree. They may begin at any time and be terminated at any time.
2. Proceedings involving good offices, conciliation and mediation shall be confidential and without prejudice to the rights of the Parties in any other proceedings.
Article 166. Consultations
1. A Party may request in writing consultations with another Party whenever it considers that a measure applied by that Party is inconsistent with this Agreement or that any benefit accruing to it directly or indirectly under this Agreement is impaired by such measure. The Party requesting consultations shall at the same time notify the other Parties in writing thereof. Consultations shall take place before the Joint Committee unless the Party or Parties making or receiving the request for consultations disagree.
2. Consultations shall be held within 30 days from the date of receipt of the request for consultations. Consultations on urgent matters, including those on perishable agricultural goods, shall commence within 15 days from the receipt of the request for consultations.
3. The Parties involved in the consultations shall provide sufficient information to enable a full examination of how the measure is inconsistent with, or may impair the benefit accruing to them under this Agreement and treat any confidential or proprietary information exchanged in the course of consultations in the same manner as the Party providing the information.
4. The consultations shall be confidential and without prejudice to the rights of the Parties involved in any further proceedings.
5. The Parties involved in the consultations shall inform the other Parties of any mutually agreed resolution of the matter.
Article 167. Establishment of Arbitration Panel
1. If the matter has not been resolved within 60 days, or 30 days in relation to a matter of urgency, after the date of receipt of the request for consultations, it may be referred to arbitration by one or more of the Parties involved by means of a written notification addressed to the Party or Parties complained against. A copy of this notification shall also be communicated to all Parties so that each Party may determine whether to participate in the dispute.
2. Where more than one Party requests the establishment of an arbitration panel relating to the same matter, a single arbitration panel should be established to examine these complaints whenever feasible.
3. A request for arbitration shall give the reason for the complaint including the identification of the measure at issue and an indication of the legal basis of the complaint.
4. A Party to this Agreement which is not a Party to the dispute, on delivery of a written notice to the disputing Parties, shall be entitled to make written submissions to the arbitration panel, receive written submissions of the disputing Parties, attend all hearings and make oral submissions.
Article 168. Arbitration Panel
1. The arbitration panel shall comprise three members.
2. In the written notification pursuant to Article 167, the Party or the Parties referring the dispute to arbitration shall designate one member of the arbitration panel.
3. Within 15 days of the receipt of the notification referred to in paragraph 2, the Party or Parties to which it was addressed to shall designate one member of the arbitration panel.
4. The Parties to the dispute shall agree on the appointment of the third arbitrator within 15 days of the appointment of the second arbitrator. The member thus appointed shall chair the arbitration panel.
5. If all 3 members have not been designated or appointed within 30 days from the date of receipt of the notification referred to in paragraph 2, the necessary designations shall be made at the request of any Party to the dispute by the Director-General of the WTO within a further 30 days.
6. The Chair of the arbitration panel shall not be a national of any of the Parties, nor have his or her usual place of residence in the territory of any of the Parties, nor be employed or previously have been employed by any of the Parties, nor have dealt with the case in any capacity.
7. If an arbitrator dies, withdraws or is removed, a replacement shall be selected within 15 days in accordance with the selection procedure followed to select him or her. In such a case, any time period applicable to the arbitration panel proceedings shall be suspended for a period beginning on the date the arbitrator dies, withdraws or is removed and ending on the date the replacement is selected.
8. The date of establishment of the arbitration panel shall be the date on which the Chair is appointed.
Article 169. Procedures of the Arbitration Panel
1. Unless the Parties to the dispute agree otherwise, the arbitration panel proceedings shall be conducted in accordance with the Model Rules of Procedure set out at Annex XVII.
2. Unless the Parties to the dispute otherwise agree within 10 days from the date of delivery of the request for the establishment of the arbitration panel, the terms of reference shall be:
"To examine, in the light of the relevant provisions of the Agreement, the matter referred to in the request for the establishment of an arbitration panel pursuant to Article 167 and to make findings of law and fact together with the reasons therefore for the resolution of the dispute."
3. At the request of a Party to the dispute or on its own initiative, the arbitration panel may seek scientific information and technical advice from experts as it deems appropriate. Any information so obtained shall be submitted to the Parties for comments.
4. The arbitration panel shall make its ruling based on the provisions of this Agreement, in particular in the light of its objectives as set out in Article 2, applied and interpreted in accordance with the rules of interpretation of public international law.
5. Decisions of the arbitration panel shall be taken by a majority of its members. Arbitrators may furnish separate opinions on matters not unanimously agreed. No arbitration panel may disclose which arbitrators are associated with majority or minority opinions.
6. The expenses of the arbitration panel, including the remuneration of its members, shall be borne by the Parties to the dispute in equal shares.
Article 170. Ruling
1. The arbitration panel shall within 90 days from the date of the establishment of the arbitration panel present to the Parties to the dispute its ruling.
2. The arbitration panel shall base its ruling on the submissions and arguments of the Parties to the dispute and on any scientific information and technical advice pursuant to Article 169(3).
3. Unless the Parties to the dispute decide otherwise, the ruling shall be published 15 days after it is presented to them.
Article 171. Termination of Arbitration Panel Proceedings
A complaining Party may withdraw its complaint at any time before the ruling has been issued. Such withdrawal is without prejudice to its right to introduce a new complaint regarding the same issue at a later point in time.
Article 172. Implementation of Arbitration Panel Rulings
1. The ruling shall be final and binding on the Parties to the dispute. Each Party to the dispute shall be bound to take the measures necessary to comply with the ruling referred to in Article 170.
2. The Parties to the dispute shall endeavour to agree on the specific measures that are required for complying with the ruling.
3. The Party complained against shall notify the other Party within 30 days after the ruling has been transmitted to the Parties to the dispute:
(a) the specific measures required for complying with the ruling;
(b) the reasonable period of time to do so; and
(c) a concrete proposal of a temporary compensation until the full implementation of the specific measures required for compliance with the ruling.
4. In case of disagreement between the Parties to the dispute on the content of such notification, the complaining Party may request the original arbitration panel to rule on whether the proposed measures referred to under paragraph 3(a) are in compliance with the ruling, on the duration of the period of time and on whether the compensation proposal is manifestly disproportionate. The ruling shall be given within 45 days after that request.
5. The Party or Parties concerned shall notify to the other Party or Parties to the dispute and the Joint Committee the measures adopted in order to implement the ruling before the expiry of the reasonable period of time determined in accordance with paragraph 4. Upon that notification, any Party to the dispute may request the original arbitration panel to rule on the conformity of those measures with the ruling. The ruling of the arbitration panel shall be given within 45 days from that request.
6. If the Party or Parties concerned fails to notify the implementing measures before the expiry of the reasonable period of time determined in accordance with paragraph 4, or if the arbitration panel rules that the implementing measures notified by the Party or Parties concerned are not in compliance with the ruling, such Party or Parties shall, if so requested by the complaining Party or Parties, enter into consultations with a view to agree on a mutually acceptable compensation. If no such agreement has been reached within 20 days from the request, the complaining Party or Parties shall be entitled to suspend only the application of benefits granted under this Agreement equivalent to those affected by the measure found to be inconsistent with, or to impair benefits under, this Agreement.
7. In considering what benefits to suspend, the complaining Party or Parties should first seek to suspend benefits in the same sector12 or sectors as that affected by the measure that the arbitration panel has found to be inconsistent with, or to impair benefits under, this Agreement. The complaining Party or Parties that consider it is not practicable or effective to suspend benefits in the same sector or sectors may suspend benefits in other sectors.
8. The complaining Party or Parties shall notify the other Party or Parties of the benefits which it intends to suspend no later than 60 days before the date on which the suspension is due to take effect. Within 15 days from that notification, any of the Parties to the dispute may request the original arbitration panel to rule on whether the benefits which the complaining Party or Parties intend to suspend are equivalent to those affected by the measure found to be inconsistent with, or to impair benefits under, this Agreement, and whether the proposed suspension is in accordance with paragraphs 6 and 7. The ruling of the arbitration panel shall be given within 45 days from that request. Benefits shall not be suspended until the arbitration panel has issued its ruling.
9. The suspension of benefits shall be temporary and shall only be applied by the complaining Party or Parties until the measure found to be inconsistent with, or to impair benefits under, this Agreement has been withdrawn or amended so as to bring it For the purpose of this Article, with respect to goods ‘sector' shall mean goods classified in Chapters 1 to 97 of the HS. into conformity with this Agreement, or the Parties to the dispute have reached agreement on a resolution of the dispute.
10. At the request of any of the Parties to the dispute, the original arbitration panel shall decide on the conformity with the ruling of any implementing measures adopted after the suspension of benefits and, in light of such ruling, whether the suspension of benefits should be terminated or modified. The ruling of the arbitration panel shall be given within 30 days from the date of that request.
11. The rulings provided for in this Article shall be binding.
Article 173. Other Provisions
1. Any time period mentioned in this Chapter may be extended by mutual agreement of the Parties involved.
2. Hearings of the arbitration panels shall be closed to the public, unless the Parties decide otherwise.
Chapter XI. General Exceptions
Article 174. Balance of Payments Difficulties
1. Where a Party is in serious balance of payments and external financial difficulties, or under threat thereof, it may adopt or maintain restrictive measures with regard to trade in goods and in services and with regard to payments and capital movements, including those related to direct investment.
2. The Parties shall endeavour to avoid the application of the restrictive measures referred to in paragraph 1.
3. Any restrictive measure adopted or maintained under this Article shall be nondiscriminatory and of limited duration and shall not go beyond what is necessary to remedy the balance of payments and external financial situation. Such a measure shall be in accordance with the conditions established in the WTO Agreements and consistent with the Articles of Agreement of the International Monetary Fund, as applicable.
4. The Party maintaining or having adopted restrictive measures, or any changes thereto, shall promptly notify them to the other Parties and present, as soon as possible, a time schedule for their removal.
5. The Party applying restrictive measures shall consult promptly within the Joint Committee. Such consultations shall assess the balance of payments situation of the Party concerned and the restrictions adopted or maintained under this Article, taking into account, inter alia, such factors as:
(a) the nature and extent of the balance of payments and the external financial difficulties;
(b) the external economic and trading environment of the consulting Party;
(c) alternative corrective measures which may be available.
The consultations shall address the compliance of any restrictive measures with paragraphs 3 and 4. All findings of statistical and other facts presented by the International Monetary Fund relating to foreign exchange, monetary reserves and balance of payments shall be accepted and conclusions shall be based on the assessment by the International Monetary Fund of the balance of payments and the external financial situation of the consulting Party.
Article 175. National Security Clause
1. Nothing in this Agreement shall be construed:
(a) to require a Party to furnish any information the disclosure of which it considers contrary to its essential security interests;
(b) to prevent a 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 or relating to the supply of services, as carried on directly or indirectly for the purpose of supplying or provisioning a military establishment;
(iii) relating to the government procurement of arms, ammunition or war materials or procurement indispensable for national security or for national defense purposes; or
(iv) taken in time of war or other emergency in international relations; or
(c) to prevent a Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
2. The Joint Committee shall be informed to the fullest extent possible of measures taken under paragraphs 1(b) and (c) and of their termination.
Article 176. Taxation
1. Nothing in this Agreement shall apply to taxation measures except:
(a) Article 13, and such other provisions of this Agreement as are necessary to give effect to that Article to the same extent as does Article III of the GATT 1994; and
(b) with regard to taxation measures applicable in Sections I and II of Chapter III and Chapter Vter (Digital Trade), where Article XIV of the GATS applies, mutatis mutandis.
2. Nothing in this Agreement shall affect the rights and obligations of any Party under any tax convention. In the event of any inconsistency between this Agreement and any such convention, that convention shall prevail to the extent of the inconsistency.
Chapter XII. Final Provisions
Article 177. Definitions
For the purposes of this Agreement, unless otherwise specified:
"days" means calendar days;
"measure" includes inter alia any law, regulation, procedure, requirement or practice; and
"Party" means any State regarding which this Agreement has entered into force.
Article 178. Annexes and Appendices
The Annexes and Appendices to this Agreement constitute an integral part thereof.
Article 179. Amendments
1. Any Party may submit proposals for amendments to this Agreement to the Joint Committee for consideration and recommendation.
2. Amendments to this Agreement shall be subject to ratification, acceptance or approval.
3. Unless otherwise agreed, amendments shall enter into force on the first day of the third month following the date on which at least one EFTA State and Chile have deposited their instrument of ratification, acceptance or approval with the Depositary. In relation to an EFTA State depositing its instrument of ratification, acceptance or approval after the date on which at least one EFTA State and Chile have deposited their instrument of ratification, acceptance or approval with the Depositary, the amendment shall enter into force on the first day of the third month following the deposit of its instrument.
4. Notwithstanding paragraphs 1 to 3, the Joint Committee may decide to amend any Annexes or Appendices to this Agreement. If a Party has accepted a decision subject to the fulfilment of domestic legal requirements, the decision shall enter into force on the first day of the third month following the date on which the last Party notifies the Depositary that its internal requirements have been fulfilled, unless otherwise specified in the decision.
5. Amendments regarding issues related only to one or several EFTA States and Chile shall be agreed upon by the Parties concerned.
6. The text of the amendments and the instruments of ratification, acceptance or approval shall be deposited with the Depositary.
7. A Party may apply an amendment provisionally, subject to its domestic legal requirements. Provisional application of amendments shall be notified to the Depositary.
Article 180. Additional Parties
Any third State may, upon invitation by the Joint Committee, become a Party to this Agreement. The terms and conditions of the accession of the additional Party shall be the subject of an agreement between the Parties and the invited State.
Article 181. Withdrawal and Termination
1. Any Party to this Agreement may withdraw therefrom by means of a written notification to the Depositary. The withdrawal shall take effect on the first day of the sixth month after the date on which the notification was received by the Depositary.
2. If one of the EFTA States withdraws from this Agreement, a meeting of the remaining Parties shall be convened to discuss the issue of the continued existence of this Agreement.
Article 182. Entry Into Force
1. This Agreement is subject to ratification, acceptance or approval. The instruments of ratification, acceptance or approval shall be deposited with the Depositary.
2. This Agreement shall enter into force on 1 February 2004 in relation to those Signatory States which by then have ratified, accepted or approved the Agreement, provided they have deposited their instruments of ratification, acceptance or approval with the Depositary at least 30 days before the date of entry into force, and provided that Chile is among the States that have deposited their instruments of ratification, acceptance or approval.
3. In case this Agreement does not enter into force on 1 February 2004, it shall enter into force on the first day of the first month following the latter deposit of the instruments of ratification, acceptance or approval by Chile and at least one EFTA State.
4. In relation to an EFTA State depositing its instrument of ratification, acceptance or approval after this Agreement has entered into force, this Agreement shall enter into force on the first day of the third month following the deposit of its instrument.
5. If its constitutional requirements permit, any EFTA State may apply this Agreement provisionally. Provisional application of this Agreement under this paragraph shall be notified to the Depositary.
Article 183. Depositary
The Government of Norway shall act as Depositary.
Conclusion
Attachments
Annex X. REFERRED TO IN ARTICLE 57. RESERVATIONS
Appendix 1. Reservations by Chile
Sector: All sectors
Subsector:
Level of Government: National
Legal source or authority of the measures:
Decreto Ley 1939, Diario Oficial, noviembre 10, 1977, Normas sobre Adquisición, Administración y Disposición de Bienes del Estado, Título I
Decreto con Fuerza de Ley 4 del Ministerio de Relaciones Exteriores, Diario Oficial, noviembre 10, 1967
Succinct description of the measure:
Chile may only dispose of the ownership or other rights over "State land" to Chilean natural or juridical persons, unless the applicable legal exceptions, such as in Decreto Ley 1939, apply. "State land" for these purposes refers to State-owned land up to a distance of 10 kilometers from the border and up to a distance of 5 kilometers from the coastline. Corporeal immovable property situated in areas declared the borderland zone by virtue of Decreto con Fuerza de Ley 4, 1967, of the Ministerio de Relaciones Exteriores may not be acquired, either as property or in any other title, by (1) natural persons with nationality in a neighboring country; (2) juridical persons with their principal seat in a neighboring country; (3) juridical persons with 40 percent or more of capital owned by natural persons with nationality in a neighboring country; or (4) juridical persons effectively controlled by such natural persons.
Notwithstanding the foregoing, this limitation may not apply if an exemption is granted by a Decreto Supremo of the President of the Republic based on considerations of national interest.
Sector: All sectors
Subsector:
Level of Government: National
Legal source or authority of the measure:
Any existing or future measure as described below
Description:
Chile reserves the right to adopt or maintain any measure relating to the ownership or control of land within five kilometers of the coastline that is used for agricultural activities. Such measures could include a requirement that the majority of each class of stock of a Chilean juridical person that seeks to own or control such land be held by Chilean persons or by persons residing in Chile for 183 days or more per year.
Sector: All sectors
Subsector:
Level of Government: National
Legal source or authority of the measure:
Any existing or future measure as described below
Succinct description of the measure:
In the transfer or disposal of any interest in stock or asset held in an existing state enterprise or governmental entity, Chile reserves the right to prohibit or impose limitations on the ownership of said interest or asset, and also on the right of foreign investors or their investment to control any state company created thereby or investments made by the same. In connection with any such transfer or disposal, Chile may adopt or maintain any measure related to the nationality of senior management and members of the Board of Directors.
A "State owned company” shall mean any company owned or controlled by Chile by means of an interest share in the ownership thereof, and it shall include any company created after the effective date of this Treaty for the sole purpose of selling or disposing of its interest share in the capital or assets of an existing state enterprise or governmental entity.
Sector: Energy
Subsector:
Level of Government: National
Legal source or authority of the measures:
Constitución Política de la República de Chile, Capítulo III
Ley 18097, Diario Oficial, enero 21, 1982, Ley Orgánica Constitucional sobre Concesiones Mineras, Títulos I, II y III.
Ley 18248, Diario Oficial, octubre 14, 1983, Código de Minería , Títulos I y II.