Gii) a regional level of government of a Member State of the European Union, as set out in [Section C of its Schedule in Annex XX (Financial Services Non-Conforming Measures)]; or
(iv) a local of government; and
For Chile:
Gi) the central government or a regional level of government, as set out in [Section C of its Schedule in Annex XX (Financial Services Non- Conforming Measures)];
(iv) a local level of government;
(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure as it existed immediately before the amendment, with Article 18.3 (National Treatment), Article 18.5 (Most Favored Nation Treatment),Article 18.8 (Senior Management and Boards of Directors) , Article 18.7 (Cross- Border Trade in Financial Services) or Article 18.9 (Performance Requirements); or
(2. Article 18.3 (National Treatment), Article 18.5 (Cross-Border Trade in Financial Services) and Article 18.8 (Senior Management and Boards of Directors) do not apply to any measure that a Party adopts or maintains with respect to sectors, subsectors, or activities, as set out by that Party in Section D of its Schedule in Annex XX (Financial Services Non- Conforming Measures).
3. Neither Party may, under any measure adopted after the date of entry into force of this Agreement and covered by D of its Schedule in Annex XX (Financial Services Non- Conforming Measures), require an investor of the other Party, by reason of its nationality, to
sell or otherwise dispose of its financial institution existing at the time the measure becomes effective.
4. Article 18.6 (Market Access) does not apply to any measure of a Party which is consistent with a reservation set out in Section D of its Schedule in Annex XX (Financial Services Non- Conforming Measures).
5. Where a Party has set out a reservation to Article 10.6 (National Treatment), Article 10.10 (Senior Management and Boards of Directors), Article 11.5 (National Treatment), or Article 18.9 (Performance requirements), in its Schedule to Annex I or II, the reservation also constitutes a reservation to Article 18.3 (National Treatment), Article 18.5 (Cross-Border Trade in Financial Services), Article 18.8 (Senior Management and Boards of Directors) , or Article 18.9 (Performance requirements), as the case may be, to the extent that the measure, sector, sub-sector or activity set out in the reservation is covered by this Chapter.]
Article 18.11. Prudential Carve-out
1. Nothing in this Agreement shall prevent a Party from adopting or maintaining measures for prudential reasons, such as:
(a) the protection of investors, depositors, policy-holders or persons to whom a fiduciary duty is owed by a financial service supplier; or
(b) to ensure the integrity and stability of a Partyâs financial system.
2. Where such measures do not conform to the provisions of this Agreement, they shall not be used as a means of avoiding the Partyâs commitments or obligations under the Agreement.
Article 18.12. Treatment of Information
Nothing in this Agreement shall be construed to require a Party to disclose information relating to the affairs and accounts of individual customers or any confidential or proprietary information in the possession of public entities.
Article 18.13. Domestic Regulation and Transparency
1. Chapter 13 (Domestic Regulation) of Chapter V (Regulatory Framework) and chapter 29 (Good Regulatory Practices) shall not apply to measures relating to the subject matter of this Chapter.
2. To the extent practicable and in a manner consistent with its legal system for adopting measures, each Party shall :
(a) publish in advance
(i) the laws and regulations of general application it proposes to adopt in relation to matters falling within the scope of this Chapter; or
(ii) documents that provide sufficient details about such a possible new law or regulation to allow interested persons and the other Party to assess whether and how their interests might be significantly affected.
(b) provide interested persons and the other Party a reasonable opportunity to comment on such proposed measures or documents published under (a);
(c) consider comments received under (b); and
(d) allow a reasonable time between the publication of the measures referred to in (a)(i) and the date on which service suppliers must comply with them.
3. This article shall apply to measures relating to licensing requirements, licensing procedures, and qualification requirements and qualification procedures in sectors for which the Party has undertaken specific commitments and to the extent that these specific commitments apply.
4. Ifa Party adopts or maintains measures relating to the authorisation for the supply of a financial service, that Party shall ensure that:
(a) (b)
(c)
such measures are based on objective and transparent criteriaâ;
the procedures are impartial, and that the procedures are adequate for applicants to demonstrate whether they meet the requirements, if such requirements exist; and
the procedures do not in themselves unjustifiably prevent fulfilment of the requirements.
5. | Where authorisationâ is required each Party shall promptly publish or otherwise make publicly available the information necessary for the applicant to comply with the requirements and procedures for obtaining, maintaining, amending and renewing such authorisation. Such information shall include, inter alia, where it exists:
(a) the requirements and procedures; (b) contact information of relevant competent authorities; (c) procedures for appeal or review of decisions concerning applications; (d) procedures for monitoring or enforcing compliance with the terms and conditions of licenses and qualifications; or (e) opportunities for public involvement, such as through hearings or comments. 6. If a Party requires authorisation for the supply of a financial service, the competent authorities of a Party shall: (a) to the extent practicable, permit an applicant to submit an application at any time throughout the year; (b) â allow a reasonable period for the submission of an application if specific time periods for applications exist; (c) initiate the processing of the application without undue delay; (d) endeavour to accept applications in electronic format under the same conditions of authenticity as paper submissions; and (e) accept copies of documents, which are authenticated in accordance with the
Partyâs domestic law, in place of original documents, unless they require original documents to protect the integrity of the authorisation process.
' Such criteria may include inter alia competence and the ability to supply a service, including to do so in a manner consistent with a Partyâs regulatory requirements. Competent authorities may assess the weight to be given to each criterion.
2 For the purposes of this Chapter, âauthorisationâ means the permission to supply a financial service, resulting from a procedure to which an applicant must adhere in order to demonstrate compliance with licensing requirements or qualification requirements.
3 For greater certainty, competent authorities are not required to start considering applications outside of their official working hours and working days.
7. Each Party shall endeavour to make authorisation procedures and formalities as simple as possible and shall not unduly complicate or delay the provision of the service.
8. Each Party shall endeavour to establish the indicative timeframe for processing of an application and shall, at the request of the applicant and without undue delay, provide information concerning the status of the application.
X If the competent authorities consider an application incomplete for processing under the Partyâs domestic laws and regulations, within a reasonable period of time, to the extent practicable:
(i) inform the applicant that the application is incomplete;
(ii) at the request of the applicant, identify the additional information required to complete the application, or otherwise provide guidance on why the application is considered incomplete; and
(iii) provide the applicant with the opportunityâ to provide the additional information that is required to complete the application;
however, if none of the above is practicable, and the application is rejected due to incompleteness, ensure that they so inform the applicant within a reasonable period of time.
9. Each Party shall ensure that its competent authorities, with respect to authorisation fees> that they charge, provide applicants with a schedule of fees or information on how fee amounts are determined, and do not use the fees as a means of avoiding the Partyâs commitments or obligations.
10. | The competent authority should reach its decision in an independent manner and not be accountable to any person supplying the services for which the licence or authorisation is required.
11. Each Party shall ensure that the processing of an application, including reaching a final decision, is completed within a reasonable timeframe after the date of submission of a complete application and that the applicant is informed of the decision concerning the application, to the extent possible, in writing.
4 Such opportunity does not require a competent authority to provide extensions of deadlines.
5 Authorisation fees do not include fees for the use of natural resources, payments for auction, tendering or other non-discriminatory means of awarding concessions, or mandated contributions to universal service provision.
12. âIf an application is rejected by the competent authority, the applicant shall be informed, either at its own request or upon the competent authorityâs initiative, in writing and without undue delay. To the extent practicable, the applicant shall be informed of the reasons for rejection of the application and of the timeframe for an appeal against this decision. An applicant should be permitted, within reasonable time limits, to resubmit an application.
13. | Where examinations are required for an authorisation, the regulatory authority shall ensure such examinations at reasonably frequent intervals and provide a reasonable period of time to enable applicants to request to take the examination.
14, Each Party shall ensure that an authorisation, once granted, enters into effect without undue delay in accordance with the terms and conditions specified therein.
Article 18.14. Financial Services New to the Territory of a Party
1. Each Party shall permit a financial institution of the other Party, other than a branch, to supply any new financial service that the former Party would permit its own financial institutions to supply in accordance with its domestic law, in like situations, provided that the introduction of the new financial services does not require a new law or modification of an existing law.
2. A Party may determine the institutional and juridical form through which the new financial service may be supplied and may require authorisation for the supply of the service. Where such authorisation is required, a decision shall be made within a reasonable period of time and the authorisation may only be refused for prudential reasons.
3. This Article does not prevent a financial institution of a Party from applying to the other Party to consider authorising the supply of a financial service that is not supplied within either Party's territory. That application is subject to the law of the Party receiving the application and is not subject to the obligations of this Article.
Article 18.15. Self-regulatory Organisations
When a Party requires a financial institution or a cross-border financial service supplier of the other Party to be a member of, participate in, or have access to, a self-regulatory organization in order to provide a financial service in or into the territory of the first Party, it shall ensure that the self-regulatory organization observes the obligations of Articles 10.6 (National Treatment) and 10.8 (Most Favored Nation Treatment) of the Investment Liberalisation Chapter and Article 11.5 (National Treatment) and 11.6 (Most Favored Nation Treatment) of the Cross Border Trade in Services Chapter.
Article 18.16. Payment and Clearing Systems
Under terms and conditions that accord national treatment, each Party shall grant to financial institutions of the other Party established in its territory access to payment and clearing systems operated by public entities, and to official funding and refinancing facilities available in the normal course of ordinary business. This Article is not intended to confer access to the Partyâs lender of last resort facilities.
Article 18.17. Financial Services Committee
1, The Parties hereby establish the Financial Services Committee (the Committee).
The Committee shall be composed of representatives of the Parties as set out in Annex XX (Authorities responsible for Financial Services).
4, The Committee shall:
(a) supervise the implementation of this Chapter;
(b) consider issues regarding financial services that are referred to it by a Party;
(c) carry out a dialogue on the regulation of the financial services sector with a view to improving mutual knowledge of the Partiesâ respective regulatory systems and to cooperate in the development of international standards; and
6. The Committee shall meet as agreed to assess the functioning of this Agreement as it applies to financial services. The Committee shall inform the Trade Committee of the results of any meeting. Meetings may be held by any technological means available to the Parties.
Article 18.18. Consultations
1. A Party may request, in writing, consultations with the other Party regarding any matter arising under this Agreement that affects financial services. The other Party shall give sympathetic consideration to the request to hold consultations. The consulting Parties shall report the results of their consultations to the Committee.
2. Each Party shall ensure that when there are consultations pursuant to paragraph 1, its delegation shall include officials with the relevant expertise in the area covered by this Chapter as set out in Annex XX (Authorities responsible for Financial Services).
3. For greater certainty, nothing in this Article shall be construed to require a Party to derogate from its relevant law regarding sharing of information among financial regulators or the requirements of an agreement or arrangement between financial authorities of the Parties, or require regulatory authorities to take any action that would interfere with specific regulatory, supervisory, administrative, or enforcement matters.
4. Nothing in this Article shall be construed to impede that where a Party requires information for supervisory purposes concerning a financial institution in the other Party's territory or a cross-border financial service supplier in the other Party's territory, the Party may approach the competent regulatory authority in the other Party's territory to seek the information.
Article 18.19. Dispute Settlement
1, Chapter 31 (Dispute Settlement), including Annexes X (Rules of Procedure) and XX (Code of Conduct), applies as modified by this Article to the settlement of disputes concerning the application or interpretation of the provisions of this Chapter.
2. In addition to the requirements set out in Article 31.7 (Requirements for Panellists â Dispute Settlement Chapter), panellists shall have expertise or experience in financial services law or practice, which may include the regulation of financial institutions, unless the Parties agree otherwise.
3. The Financial Services Committee shall recommend to the Trade Committee the adoption of a list of at least 15 individuals, fulfilling the requirements set out in paragraph 2, who are willing and able to serve as panellists. The Trade Committee shall adopt such list no later than six months after the date of entry into force of this Agreement. The list shall be composed of three sub-lists:
(a) one sub-list of individuals established on the basis of proposals by the European Union;
(b) one sub-list of individuals established on the basis of proposals by the Republic of Chile; and
(c) one sub-list of individuals that are not nationals of either Party and who shall serve as chairperson to the panel.
4, Each sub-list shall include at least five individuals. The Trade Committee shall ensure that the list is always maintained at this minimum number of individuals.
5. For the purposes of this Chapter, the sub-lists referred to in paragraph 3 shall, after adoption, replace the sub-lists set out in paragraph 1 of Article 31.7 (List of Panellists â Dispute Settlement Chapter).
ANNEX XX AUTHORITIES RESPONSIBLE FOR FINANCIAL SERVICES
The authorities for each Party responsible for financial services are:
(a) for EU, [...]
(b) for Chile, the Ministry of Finance (Ministerio de Hacienda);]
Chapter 19. DIGITAL TRADE
Chapter Chapter I General Provisions
Article 19.1. Scope
1. This Title shall apply to trade enabled by telecommunications or other information and communication technologies.
2. The provisions in this Title shall not apply to audio-visual services.
Article 19.1. Bis Right to Regulate
The Parties affirm the right to regulate within their territories to achieve legitimate policy objectives, such as the protection of public health, social services, public education, safety, the environment, including climate change, public morals, social or consumer protection, ptivacy and data protection, or the promotion and protection of cultural diversity.
Article 19.2. Definitions
1. The definitions included in article 10.1 of the title on investment liberalization and/or trade in services apply to this title.
a. The definition of âpublic telecommunications serviceâ in Article 16.2) of the Telecommunications Chapter applies to this Chapter.
2. For the purpose of this Chapter:
a)
b)
d)
g)
âconsumerâ means any natural person, or juridical person if provided for in the laws and regulations of a Party, using or requesting a public telecommunications service for other than professional purposes;
âdirect marketing communicationâ means any form of commercial advertising by which a natural or legal person communicates marketing messages directly to end- users via a public telecommunications service and, for the purpose of this agreement, covers at least electronic mail, text and multimedia messages;
âelectronic authenticationâ means a process that enables to confirm: i, the electronic identification of a natural or juridical person, or ii. the origin and integrity of data in electronic form;
âelectronic sealâ means data in electronic form used by a legal person which is attached to or logically associated with other data in electronic form to ensure the latter's origin and integrity;
âelectronic signatureâ means data in electronic form which is attached to or logically associated with other electronic data and fulfils the following requirements:
i, it is used by a natural person to agree on the electronic data to which it relates;
ii. it is linked to the electronic data to which it relates in such a way that any subsequent alteration in the data is detectable;
âelectronic trust servicesâ means an electronic service consisting of the creation, verification, validation of electronic signatures, electronic seals, electronic time stamps, electronic registered delivery, website authentication and certificates related to those services;
âend-userâ means any natural or legal person using or requesting a public telecommunications service, either as a consumer or, if provided for in the laws and regulations of a Party, for trade, business or professional purposes;
For the purposes of this agreement, "personal data" means any information relating to an identified or identifiable natural person.
Article 19.3. Exceptions
Nothing in this Title prevents Parties from adopting or maintaining measures in accordance with [insert references to general exceptions, security exception and prudential carve-out] for the public interest reasons set out therein.
[This Article may be moved to a horizontal title that applies to the entire FTA.]
Chapter Chapter IT Data Flows and Personal Data Protection
Article 19.4. Cross-border Data Flows: Prohibition of Data Localisation
The Parties are committed to ensuring cross-border data flows to facilitate trade in the digital economy. To that end, cross-border data flows shall not be restricted between the Parties by:
a)
b)
d)
1.
requiring the use of computing facilities or network elements in the Party's territory for processing, including by imposing the use of computing facilities or network elements that are certified or approved in the territory of the Party;
requiring the localisation of data in the Party's territory for storage or processing; prohibiting storage or processing in the territory of the other Party; making the cross-border transfer of data contingent upon use of computing facilities or
network elements in the Partyâs territory or upon localisation requirements in the Partyâs territory.
Article 19.5. Protection of Personal Data and Privacy
Each Party recognises that the protection of personal data and privacy is a fundamental right and that high standards in this regard contribute to trust in the digital economy and to the development of trade.
Each Party may adopt and maintain the measures it deems appropriate to ensure the protection of personal data and privacy, including the adoption and application of rules for the cross-border transfer of personal data. Nothing in this agreement shall affect the protection of personal data and privacy afforded by the Partiesâ respective measures.
For greater certainty, the Investment Court System does not apply to the provisions in Articles 19.4 and 19.5.
Chapter Chapter IIT Specific Provisions
Article 19.6. Customs Duties on Electronic Transmissions
No Party shall impose customs duties on electronic transmissions between a person of one Party and a person of the other Party.
Article 19.7. No Prior Authorisation
1. A Party shall not require prior authorisation solely on the ground that a service is provided online! or adopt or maintain any other requirement having equivalent effect.
2. Paragraph 1 does not apply to telecommunications services, broadcasting services, gambling services, legal representation services, nor to services of notaries or equivalent professions to the extent that they involve a direct and specific connection with the exercise of public authority.
Article 19.8. Conclusion of Contracts by Electronic Means
1. The Parties shall ensure that their legal systems allow contracts to be concluded by electronic means and that the legal requirements for contractual processes neither create obstacles for the use of electronic contracts nor result in such contracts being deprived of legal effect and validity for having been made by electronic means.
2. For the purposes of this Agreement, the obligation set out in paragraph 1 does not apply to broadcasting services, gambling services, legal representation services, to services of notaries or equivalent professions involving a direct and specific connection with the exercise of public authority, and to contracts that establish or transfer rights in real estate, contracts requiring by law the involvement of courts, public authorities or professions exercising public authority, contracts of suretyship granted and or collateral securities furnished by persons acting for purposes outside their trade, business or profession and contracts governed by family law or by the law of succession.
! A service is provided online when it is provided by electronic means and without the parties being
simultaneously present.
Article 19.9. Electronic Trust Services and Electronic Authentication
1. A Party shall not deny the legal effect and admissibility as evidence in legal proceedings of an electronic trust services and electronic authentication service on the basis that it is in electronic form.
2. Neither Party shall adopt or maintain measures that would:
a) prohibit parties to an electronic transaction from mutually determining the appropriate electronic authentication methods for their transaction; or
b) prevent parties to an electronic transaction from having the opportunity to prove to judicial and administrative authorities that their electronic transaction complies with any legal requirements with respect to electronic trust services and electronic authentication.
3. Notwithstanding paragraph 2, a Party may require that for a particular category of transactions, the method of authentication or trust service is certified by an authority accredited in accordance with its law or meets certain performance standards which shall be objective, transparent and non-discriminatory and shall only relate to the specific characteristics of the category of transactions concerned.