1. Unless otherwise agreed by the disputing Parties, the proceedings before the arbitral tribunal shall be governed by the Model Rules of Procedure contained in Annex 19-10.
2. The Commission may modify the Model Rules of Procedure.
3. Unless otherwise agreed by the Parties, the terms of reference of the arbitral tribunal shall be:
"To examine, in the light of the applicable provisions of the treaty, the dispute submitted for its consideration under the terms of the request for the meeting of the Commission, and to issue the preliminary report and the final report referred to in Articles 19-13 and 19-14."
4. If the complaining Party alleges that a matter has caused nullification or impairment within the meaning of Annex 19-02, the terms of reference shall so state.
5. Where a disputing Party requests that the arbitral tribunal make findings as to the extent of the adverse trade effects on any Party of the measure found to be inconsistent with this treaty or to have caused nullification or impairment within the meaning of Annex 19-02, the terms of reference shall so state.
Article 19-11. Participation of a Third Party.
A third Party, upon written notice through its national section of the Secretariat to the disputing Parties, shall have the right to attend all hearings, to make written and oral submissions to the arbitral tribunal and to receive written submissions from the disputing Parties.
Article 19-12. Information and Technical Advice.
On its own motion or at the request of a disputing party, the arbitral tribunal may seek information and technical advice from such persons or institutions as it deems appropriate.
Article 19-13. Preliminary Report.
1. The arbitral tribunal shall issue a preliminary report on the basis of the arguments and submissions made by the disputing Parties and any information it has received pursuant to Article 19-12.
2. Unless the disputing Parties agree otherwise, the arbitral tribunal shall, within 90 days after the appointment of the last arbitrator, submit to the disputing Parties a preliminary report containing:
a) findings of fact, including any arising from a request pursuant to paragraph 5 of Article 19- 10;
b) a determination as to whether the measure in question is or may be inconsistent with the obligations under this treaty, or is a cause for nullification or impairment within the meaning of Annex 19-02 or any other determination requested in the mandate; and
c) the final draft report.
3. The arbitrators may issue written opinions on matters on which there is no unanimity.
4. The disputing Parties may submit written comments to the arbitral tribunal on the preliminary report within 15 days of its submission.
5. In this case, after examining the written observations, the arbitral tribunal may, on its own motion or at the request of a disputing Party:
a) request the observations of any disputing Party;
b) conduct any due diligence it deems appropriate; or
c) reconsider the preliminary report.
Article 19-14. Final Report.
1. The arbitral tribunal shall notify the disputing Parties of its final report, agreed by majority vote, and, where appropriate, written opinions on issues on which there was no unanimity, within 30 days of the submission of the preliminary report.
2. Neither the preliminary nor the final report shall disclose the identity of the arbitrators who voted with the majority or the minority.
3. The disputing Parties shall confidentially communicate the final report to the Commission within five days of its notification, together with any written considerations that a disputing Party may wish to attach.
4. The final report shall be published within 15 days of its communication to the Commission in the Official Journal of each disputing Party.
Article 19-15. Compliance with the Final Report.
1. The final report shall be binding on the disputing Parties under the terms and within the time limits ordered by it, which shall not exceed three months from its communication to the Commission, unless the Parties agree otherwise.
2. Where the final report of the arbitral tribunal finds that the measure is incompatible with this treaty, the Party complained against shall refrain from implementing the measure or shall repeal it.
3. Where the final report of the arbitral tribunal finds that the measure is a cause for nullification or impairment within the meaning of Annex 19-02, it shall determine the level of nullification or impairment and may suggest such adjustments as it considers mutually satisfactory to the disputing Parties.
Article 19-16. Suspension of Benefits.
1. The complaining Party may suspend the Party complained against from the application of benefits under this treaty having equivalent effect to the benefits foregone, if the arbitral tribunal decides:
a) that a measure is incompatible with the obligations of this treaty and the Party complained against fails to comply with the final report within the time limit set by the arbitral tribunal; or
b) that a measure is a cause for annulment or impairment within the meaning of Annex 19-02 and the disputing Parties fail to reach a mutually satisfactory settlement of the dispute within the period of time fixed by the arbitral tribunal.
2. The suspension of benefits shall last until the Party complained against complies with the final report or until the disputing Parties reach a mutually satisfactory agreement on the dispute, as the case may be. However, if the Party complained against is made up of two or more Parties, and any of them complies with the final report, or reaches a mutually satisfactory agreement with the complaining Party, the complaining Party shall lift the suspension of benefits.
3. In considering the benefits to be suspended pursuant to this Article:
a) the complaining Party shall first seek to suspend benefits within the same sector or sectors that are affected by the measure, or by another matter that the arbitral tribunal has found to be inconsistent with the obligations under this treaty, or that would have caused nullification or impairment within the meaning of Annex 19-02; and
b) if the complaining Party considers that it is not feasible or effective to suspend benefits in the same sector or sectors, it may suspend benefits in other sectors.
4. At the written request of any disputing Party, upon notification to the other Parties through its national section of the Secretariat, the Commission shall establish an arbitral tribunal to determine whether the level of benefits suspended by the complaining Party pursuant to this Article is manifestly excessive. To the extent possible, the arbitral tribunal shall be composed of the same members as the arbitral tribunal that issued the final report referred to in Article 19-14.
5. The proceedings before the arbitral tribunal constituted for the purposes of paragraph 4 shall be conducted in accordance with the Model Rules of Procedure. The arbitral tribunal shall render its final decision within 60 days after the last arbitrator has been chosen, or within such other period of time as the disputing Parties may agree.
Article 19-17. Judicial and Administrative Instances.
1. The Commission shall endeavor to agree, as soon as possible, on an appropriate non-binding interpretation or response when:
a) a Party considers that a question of interpretation or application of this treaty arising out of or in connection with a judicial or administrative proceeding of another Party warrants interpretation by the Commission; or
b) a Party receives a request for an opinion on a question of interpretation or application of this treaty from a court or administrative body of that Party. The Party in whose territory the court or administrative body is located shall submit the Commission's response to them, in accordance with the procedures of that forum.
2. When the Commission is unable to agree on a response, any Party may submit its own opinion to the tribunal or administrative body, in accordance with the procedures of that forum.
Article 19-18. Alternative Means of Dispute Resolution.
1. Each Party shall promote and facllitate arbitration and other alternative means of settling international commercial disputes between private parties.
2. To this end, each Party shall have appropriate procedures to ensure the enforcement of arbitration agreements and the recognition and enforcement of arbitral awards rendered in such disputes.
Annex 19-02. Nullification and impairment
1. The Parties 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 treaty, they consider that the benefits that they could reasonably have expected to receive from the application of Chapters Ill, IV, V, VI, VII, VIII, IX, X, XV and XVI are nullified or impaired.
2. The Parties may not invoke nullification or impairment of the provisions of Chapters XI, XII, XIII and XIV.
Annex 19-08. CODE OF CONDUCT
OBJECTIVE
This Code of Conduct is established to ensure respect for the principles of integrity and impartiality that the Parties grant to the procedures of Chapter XIX of the Free Trade Agreement between the United Mexican States and the Republics of El Salvador, Guatemala and Honduras.
The fundamental objective of this code of conduct is that a candidate or member must disclose the existence of any interest, relationship or matter that might affect his or her independence or impartiality or that might reasonably create an appearance of impropriety or bias. An appearance of impropriety or bias exists when a reasonable person, with knowledge of all relevant circumstances that a reasonable inquiry might disclose, would conclude that the candidate's or member's ability to perform his or her duties with integrity, impartiality and in a competent manner is impaired.
However, this principle should not be interpreted in such a way that the burden of making detailed disclosures makes It impossible for jurists or business people to agree to serve as members, thus depriving the Parties and participants of those who may be the best members. Consequently, candidates and members should not be required to disclose interests, relationships or matters that have a trivial influence on the proceeding.
Candidates and members have a continuing obligation to disclose, throughout the proceeding, interests, relationships and matters that may be linked to the integrity or fairness of the dispute resolution system.
This code of conduct does not determine whether, or under what circumstances, the Parties will, based on the disclosures made, challenge or remove a candidate or member of an arbitral tribunal.
DEFINITIONS
1. For the purposes of this code of conduct, the following definitions shall apply:
assistant: a researcher or a person who provides support to a member, in accordance with the terms of his or her appointment;
candidate:
a) an individual whose name appears on a list established pursuant to Article 19-08; or
b) an individual being considered for appointment as a member of an arbitral tribunal pursuant to Article 19-09;
member: a member of an arbitral tribunal constituted in accordance with article 19-09;
personal: with respect to a member, persons, other than assistants, who are under his or her direction and control;
procedure:
a) a proceeding before an arbitral tribunal conducted in accordance with Chapter XIX; or
b) a proceeding involving a dispute arising under Chapter V or XV to which Chapter XIX applies; and
Secretariat: the Secretariat established pursuant to Article 18-02; and
2. Any reference in this code of conduct to an article, annex or chapter is understood to refer to the corresponding article, annex or chapter of the treaty.
Section A. Responsibilities with Respect to the Dispute Resolution System.
All candidates, members and former members shall maintain high standards of conduct so that the integrity and impartiality of the dispute resolution system is preserved.
Section B. Reporting Obligations.
1. Each candidate shall disclose any interest, relationship or matter that might affect his or her independence or impartiality or that might reasonably create an appearance of impropriety or bias in the proceeding. To this end, candidates shall make every reasonable effort to become aware of any such interests, relationships and matters.
2. Candidates shall disclose such interests, relationships and matters by completing the Initial Declaration to be provided to them by the Secretariat and submitting it to the Secretariat.
3. Without limiting the generality of the foregoing, each candidate shall disclose the following interests, relationships and matters:
a) any financial or personal interest of the candidate:
i) in the proceeding or its outcome; and
ii) in an administrative proceeding, a domestic judicial proceeding or other proceeding before an arbitral tribunal, involving issues that may be decided in the proceeding for which the candidate is being considered;
b) any financial interest of the candidate's employer, partner, associate or family member:
i) in the proceeding or its outcome; and
ii) in an administrative proceeding, a domestic judicial proceeding or other proceeding before an arbitral tribunal, involving issues that may be decided in the proceeding for which the candidate is being considered;
c) any relationship, present or past, of a financial, business, professional, family or social nature with any interested parties to the proceeding, or with their attorneys, or any such relationship with the candidate's employer, partner, associate or family member; and
d) any provision of services as a public defender, or as a legal representative, or otherwise, relating to any matter in controversy in the proceeding or involving the same assets.
4. Once appointed, members shall continue to make every reasonable effort to become aware of any interests, relationships or matters referred to in paragraph 1 and shall disclose them. The obligation to disclose is ongoing and requires a member to disclose any such interests, relationships and matters that may arise at any stage of the proceeding.
5. Each member shall disclose such interests, relationships and matters by communicating them in writing to the Secretariat for consideration by the appropriate Parties.
Section C. Performance of Duties of Nominees and Members.
1. Any candidate accepting appointment as a member shall be available to perform, and shall perform, the duties of a member fully and expeditiously throughout the proceedings.
2. Members shall ensure that the Secretariat is able to contact them at all reasonable times in order to perform the functions of the arbitral tribunal.
3. Every member shall perform his duties in a fair and diligent manner.
4. Each member shall comply with the provisions of Chapter XIX and the model rules of procedure.
5. No member shall deprive any other member of the right to participate in all aspects of the proceedings.
6. The members shall consider only those disputed issues that have arisen in the proceeding and are necessary to reach a decision. Except as otherwise provided in the above rules, no member shall delegate to another person the duty to decide.
7. Members shall take all reasonable steps to ensure that their assistants and staff comply with Sections A, B and F of this code of conduct.
8. No member shall establish ex parte contacts in the proceeding.
9. No candidate or member shall disclose matters relating to violations or potential violations of this Code of Conduct unless it is made to the Secretariat or is necessary to ascertain whether the candidate or member has violated or may violate the Code.
Section D. Independence and Impartiality of Members.
1. Each member shall be independent and impartial. Each member shall act fairly and avoid creating an appearance of dishonesty or bias.
2. No member may be influenced by self-interest, outside pressure, political considerations, public pressure, loyalty to a Party or fear of criticism.
3. No member may, directly or indirectly, acquire any obligation or accept any benefit that would in any way interfere, or appear to interfere, with the performance of its duties.
4. No member shall use his or her position on the arbitral tribunal for personal or private gain. A member shall avoid creating the impression that others can influence him or her. Members shall make every effort to prevent or discourage others from creating such influence.
5. No member shall allow his or her judgment or conduct to be influenced by present or past financial, business, professional, family or social relationships or responsibilities.
6. Each member shall avoid entering into any relationship or acquiring any interest, of a financial nature, which is likely to influence his or her impartiality or which might reasonably create an appearance of dishonesty or bias.
Section E. Specific Obligations.
A former member shall avoid creating the appearance that he or she was biased in the performance of his or her duties as a member or that he or she might benefit from the decision of the arbitral tribunal.
Section F. Confidentiality.
1. Members or former members shall never disclose or use information related to the proceeding or acquired during the proceeding, which is not in the public domain, except for purposes of the proceeding. In no event shall members or former members disclose or use such information to benefit themselves, to benefit others, or to adversely affect the interests of others.
2. No member shall disclose an order or decision of an arbitral tribunal prior to its issuance by the arbitral tribunal.
3. No member shall disclose a report of an arbitral tribunal issued pursuant to Chapter XIX prior to its publication by the Commission. Members or former members shall never disclose the identity of members who voted with the majority or minority in a proceeding conducted pursuant to Chapter XIX.
4. Members or former members shall never disclose the deliberations of an arbitral tribunal, or any opinion of a member, except when required by law.
Section G. Responsibilities of Attendees and Staff.
Sections A, B and F of this Code of Conduct also apply to assistants and staff supporting thearbitral tribunal.
FREE TRADE AGREEMENT BETWEEN THE UNITED MEXICAN STATES AND THE REPUBLICS OF EL SALVADOR, GUATEMALA AND HONDURAS
PROCEDURE (title) (File number assigned by the Secretariat)
INITIAL STATEMENT
I have read the CODE OF CONDUCT FOR DISPUTE SETTLEMENT PROCEEDINGS OF CHAPTER XIX OF THE FREE TRADE AGREEMENT CONCLUDED BETWEEN THE UNITED MEXICAN STATES AND THE REPUBLICS OF EL SALVADOR, GUATEMALA AND HONDURAS. (Code of Conduct). I am fully aware that Section B of the Code of Conduct requires me to disclose interests, relationships and matters that could affect my independence or impartiality or that could reasonably create an appearance of dishonesty or bias in the above proceeding.
I have read the request for review by an arbitral tribunal filed in the above-entitled proceeding and have made every reasonable effort to become aware of the existence of any such interest, relationship or matter. I make the following declaration fully aware of my duties and obligations under the Code of Conduct.
1. I have no financial or personal interest in the above proceeding or its outcome, except as follows:
2. I have no financial or personal interest in any administrative proceeding, domestic judicial proceeding or other proceeding before an arbitral tribunal involving issues that may be decided in the above proceeding, except as follows:
3. I am not aware that my employer, partner, associate or any member of my family has an interest of a financial nature in the above proceeding or its outcome, except as follows:
4. I am not aware that my employer, partner, associate or any member of my family has an interest of a financial nature in an administrative proceeding, an internal judicial proceeding or other proceeding before an arbitral tribunal involving issues that may be decided in the above proceeding, except as follows:
5. I have no relationship, present or past, of a financial, business, professional, family or social nature with any of the parties to the above proceeding, or their attorneys, nor am I aware of any such relationship with my employer, partner, associate or family member, except as follows:
6. I have not rendered my services as a public defender, or as a legal representative, or otherwise, in a matter in controversy in the above proceeding or involving the same assets, except as follows:
7. I have no interests or relationships, other than those described above, nor have I become aware of any matter that could affect my independence or impartiality or that might reasonably create an appearance of dishonesty or bias, except as follows:
I acknowledge that, once appointed, I have a continuing obligation to make every reasonable effort to become aware of any interest, relationship or matter within the scope of Section B of the Code of Conduct, which may arise during any phase of the above procedure and to disclose it in writing to the Secretariat when I become aware of it.
Signature Name (typed name)
Annex 19-10. MODEL RULES OF PROCEDURE
DEFINITIONS
1. For the purposes of these Rules, the following definitions shall apply:
advisor: a person engaged by a Party to advise or assist it in connection with proceedings before an arbitral tribunal;
non-business day: with respect to a Party, all Saturdays and Sundays, and any other day designated by that Party as a non-business day and notified to the other Parties;
Party complained against: the Party or Parties against whom the claim is formulated, in the terms of the definition of complaining Party;
Disputing Parties: the Complaining Party and the Respondent;
Parties involved: the disputing Parties and a third Party;
Claimant Party: the Party making a claim, which may consist of one or more Parties:
a) in no case may Mexico make the claim jointly with any other Party; and
b) El Salvador, Guatemala and Honduras, individually or jointly, may only use this dispute settlement procedure to formulate claims against Mexico;
responsible section of the Secretariat: the national section of the Secretariat of the Party complained against. In the event that the Party complained against is made up of two or more Parties, one of its national sections of the Secretariat, chosen by lot, shall be the responsible section of the Secretariat;
Secretariat: the Secretariat established pursuant to Article 18-02; and
third Party: a Party, other than a disputing Party, that provides a written notification in accordance with Article 19-11.
MANDATE
2. The disputing Parties shall promptly deliver the Terms of Reference to the responsible section of the Secretariat, which shall immediately deliver them to the arbitral tribunal, once it has been established.
3. If the disputing Parties have not agreed on the terms of reference after 20 days from the date of delivery of the request for the establishment of the arbitral tribunal, at the request of any Party, a mandate in the terms of Article 19-10 shall be delivered to the disputing Parties and to the third Party, and to the arbitral tribunal, once it has been established.
WRITINGS AND OTHER DOCUMENTS
4. A Party or the arbitral tribunal, respectively, shall deliver any request, notice and other documents relating to the proceeding to the responsible section of the Secretariat, which in turn shall forward them as expeditiously as possible to the other Parties involved and to the arbitral tribunal.
5. To the extent possible, each Party involved shall attach an electronic copy of any request, notice, written submission or other document that it submits to a responsible section of the Secretariat.
6. The Parties involved shall deliver to their responsible section of the Secretariat the original and seven copies of each of their written submissions and, at the same time, shall make available to the Embassy of each of the other Parties involved a copy of the same.
7. No later than 10 days after the date on which the arbitral tribunal has been established, the complaining Party shall deliver to its responsible section of the Secretariat its initial written statement. Within 20 days after the date of delivery of the initial written statement, the Party complained against shall deliver its statement of defense to its responsible section of the Secretariat. The third Party shall deliver its submission to its responsible section of the Secretariat, within the same time limit within which the Party complained against must submit its submission.