Where 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 organisation to provide a financial service in or into the territory of that Party, that Party shall ensure observance of the obligations set out in Articles 11.2 and 11.3 by such self-regulatory organisation.
Article 11.14. Consultations
1. A Party may request 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. The Parties shall report the results of their consultations to the Administrative Commission established pursuant to Article 17.1 (Administrative Commission of the Agreement).
2. Consultations under this Article shall include officials of the authorities specified in Annex 11A.
3. Nothing in this Article shall be construed to require regulatory authorities participating in consultations under paragraph 1 to disclose information or take any action that would interfere with specific regulatory, supervisory, administrative, or enforcement matters.
4. 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.
Article 11.15. Dispute Settlement
1. Except otherwise provided for, Chapter 15 (Dispute Settlement) applies as modified by this Article to the settlement of disputes arising under this Chapter.
2. When a Party claims that a dispute arises under this Chapter, the panel shall compose:
(a) where the disputing Parties so agree, entirely of panelists meeting the criteria set out in paragraph 3; and
(b) in any other case, panelists meeting the criteria set out in either paragraph 3 or in Article 15.7.5 (Composition of Arbitral Panels), However, the chair of the panel shall meet the criteria set out in paragraph 3 if Article 11.11 is invoked by the Party complained against, unless the Parties agree otherwise.
3. Financial services panelists shall:
(a) have expertise or experience in financial services law or practice, which may include the regulation of financial institutions;
(b) be chosen strictly on the basis of objectivity, reliability and sound judgment; and
(c) meet the criteria set out in Article 15.7.5 (Composition of Arbitral Panels).
4. Notwithstanding Article 15.16 of Dispute Settlement (Non-
implementation – Compensation and Suspension of Benefits), where a panel finds a measure to be inconsistent with this Agreement and the measure under dispute affects:
(a) only the financial services sector, the complaining Party may suspend benefits only in the financial services sector;
(b) the financial services sector and any other sector, the complaining Party may suspend benefits in the financial services sector that have an effect equivalent to the effect of the measure in the Party’s financial services sector; or
(c) only a sector other than the financial services sector, the complaining Party may not suspend benefits in the financial services sector.
Article 11.16 . Definitions
For purposes of this Chapter:
1. cross-border financial service supplier of a Party means a person of a Party that is engaged in the business of supplying a financial service within the territory of the Party and that seeks to supply or supplies a financial service through the cross-border supply of such services;
2. cross-border trade in financial services or cross-border supply of financial services means the supply of a financial service:
(a) from the territory of one Party into the territory of the other Party;
(b) in the territory of one Party by one person of that Party to a person of the other Party; or
(c) by a national of one Party in the territory of the other Party,
but does not include the supply of a financial service in the territory of a Party by an investor of the other Party, or investments of such investors, in financial institutions in the Party’s territory;
3. enterprise of a Party means an enterprise, as defined in Article 1.3.3 (Definitions of General Application), organised or constituted under the laws of a Party and a branch located in the territory of a Party. For the purposes of this Chapter, an enterprise of a Party includes a branch of an enterprise of a non-Party in the territory of a Party;
4. financial institution means any financial intermediary or other enterprise that is authorised to do business and regulated or supervised as a financial institution under the law of the Party in whose territory is located;
5. financial institution of the other Party means a financial institution, including a branch, located in the territory of a Party that is controlled by persons of the other Party;
6. financial service means any service of a financial nature. Financial services include all insurance and insurance-related services, and all banking and other financial services (excluding insurance), as well as services incidental or auxiliary to a service of a financial nature. Financial services include the following activities:
Insurance and insurance-related services
(a) direct insurance (including co-insurance):
(i) life;
(ii) non-life;
(b) reinsurance and retrocession;
(c) insurance intermediation, such as brokerage and agency;
(d) service auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services.
Banking and other financial services (excluding insurance)
(e) acceptance of deposits and other repayable funds from the public;
(f) lending of all types, including consumer credit, mortgage credit, factoring and financing of commercial transactions;
(g) financial leasing;
(h) all payment and money transmission services, including credit, charge and debit cards, travelers checks and bankers drafts;
(i) guarantees and commitments;
(j) trading for own account or for account of customers, whether on an exchange, in an over-the-counter market or otherwise, the following:
(i) money market instruments (including checks, bills, certificates of deposits);
(ii) foreign exchange;
(iii) derivative products including, but not limited to, futures and options;
(iv) exchange rate and interest rate instruments, including products such as swaps, forward rate agreements;
(v) transferable securities;
(vi) other negotiable instruments and financial assets, including bullion;
(k) participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;
(l) money broking;
(m) asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;
(n) settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;
(o) provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services;
(p) advisory, intermediation and other auxiliary financial services on all the activities listed in sub-paragraphs (e) through (o), including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy.
7. financial service supplier of a Party means a person of a Party that is engaged in the business of supplying a financial service within the territory of that Party;
8. investment means “investment” as defined in Article 9.1 (Definitions), except that, with respect to “loans” and “debt instruments” referred to in that Article:
(a) a loan to or debt instrument issued by a financial institution is an investment only where it is treated as regulatory capital by the Party in whose territory the financial institution is located; and
(b) a loan granted by or debt instrument owned by a financial institution, other than a loan to or debt instrument of a financial institution referred to in sub-paragraph (a), is not an investment;
For greater certainty, a loan granted by or debt instrument owned by a cross-border financial service supplier, other than a loan to or debt instrument issued by a financial institution, is an investment if such loan or debt instrument meets the criteria for investments set out in Article 9.1 (Definitions).
9. investor of a Party means a Party or state enterprise thereof, or a person of that Party, that attempts to make, is making, or has made an investment in the territory of the other Party;
10. new financial service means, for purposes of Article 11.7, a financial service not supplied in the Party’s territory that is supplied within the territory of the other Party, and includes any new form of delivery of a financial service or the sale of a financial product that is not sold in the Party’s territory;
11. public entity means:
(a) a government, central bank or a monetary authority of a Party, or an entity owned or controlled by a Party, that is principally engaged in carrying out governmental functions or activities for governmental purposes, not including an entity principally engaged in supplying financial services on commercial terms; or
(b) a private entity performing functions normally performed by a central bank, or monetary authority, when exercising those functions; and
12. self-regulatory organisation means any non-governmental body, including any securities or futures exchange or market, clearing agency, other organization or association, that exercises regulatory or supervisory authority over financial service suppliers or financial institutions by statue or delegation from the government or relevant authorities.
Chapter 12. TELECOMMUNICATIONS
Article 12.1. Scope and Coverage
1. This Chapter applies to measures (1) affecting trade in public telecommunications transport network and services.
2. This Chapter does not apply to any measure adopted or maintained by a Party relating to cable or broadcast distribution of radio or television programming (2).
3. Nothing in this Chapter shall be construed to:
(a) require a Party (or require a Party to compel any service supplier) to establish, construct, acquire, lease, operate, or provide telecommunications transport networks or telecommunications services where such networks or services are not offered to the public generally; or
(b) require a Party to compel any service supplier engaged in the cable or broadcast distribution of radio or television programming to make available its cable or broadcast facilities as a public telecommunications transport network, unless a Party specifically designates such facilities as such.
Article 12.2. Access to and Use of Public Telecommunications Transport Network and Services (3)
1. A Party shall ensure that service suppliers of the other Party have access to and use of any public telecommunications transport network and service, including leased circuits, offered in its territory or across its borders on reasonable, non-discriminatory, timely and transparent terms and conditions, including as set out in paragraphs 2 through 6.
2. Each Party shall ensure that such service suppliers are permitted to:
(a) purchase or lease, and attach terminal or other equipment that interfaces with the public telecommunications transport network;
(b) provide services to individual or multiple end-users over any leased or owned circuit(s);
(c) interconnect private leased or owned circuits with public telecommunications transport networks and services or with circuits leased or owned by another service supplier subject to paragraph 6 (c);
(d) perform switching, signalling, processing, and conversion functions; and
(e) use operating protocols of their choice.
3. A Party shall ensure that service suppliers of the other Party may use public telecommunications transport networks and services for the movement of information in its territory or across its borders and for access to information contained in data bases or otherwise stored in machine-readable form in the territory of either Party.
4. Notwithstanding paragraph 3, a Party may take such measures as are necessary to:
(a) ensure the security and confidentiality of messages; or
(b) protect the privacy of customer proprietary network information,
subject to the requirement that such measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on trade in services.
5. Each Party shall ensure that no condition is imposed on access to and use of public telecommunications transport networks or services, other than that necessary to:
(a) safeguard the public service responsibilities of suppliers of public telecommunications transport networks or services, in particular, their ability to make their networks or services available to the public generally; or
(b) protect the technical integrity of public telecommunications transport networks or services.
6. Provided that conditions for access to and use of public telecommunications transport networks or services satisfy the criteria set out in paragraph 5, such conditions may include:
(a) a requirement to use specified technical interfaces, including interface protocols, for interconnection with such networks or services;
(b) a licensing, permit, registration, or notification procedure; or
(c) restrictions on interconnection of private leased or owned circuits with such networks or services or with circuits leased or owned by another services supplier.
Article
Article 12.3. Interconnection with Suppliers of Public Telecommunications Transport Networks and Services
1. A Party shall ensure that suppliers of public telecommunications transport networks or services in its territory provides interconnection with the facilities and equipment of suppliers of public telecommunications transport networks or services of the other Party.
2. In carrying out paragraph 1, each Party shall ensure that suppliers of public telecommunications transport networks or services in its territory take reasonable steps to protect the confidentiality of proprietary information of, or relating to, suppliers and end-users of public telecommunications transport networks or services and only use such information for the purpose of providing public telecommunications transport networks or services.
Article 12.4. Conduct of Major Suppliers (4)
Treatment by Major Suppliers
1. A Party shall ensure that any major supplier in its territory accords suppliers of public telecommunications transport networks or services of the other Party treatment no less favourable than such major supplier accords to itself, its subsidiaries, its affiliates, or any non-affiliated service supplier regarding:
(a) the availability, provisioning, rates, or quality of like public telecommunications transport networks or services; and
(b) the availability of technical interfaces necessary for interconnection.
A Party shall assess such treatment on the basis of whether such suppliers of public telecommunications transport networks or services, subsidiaries, affiliates, and non-affiliated service suppliers are in like circumstances.
Competitive Safeguards
2. Each Party shall maintain appropriate measures for the purpose of preventing suppliers of public telecommunications transport networks or services who, alone or together, are a major supplier in its territory from engaging in or continuing anti-competitive practices. For purposes of this paragraph, anti-competitive practices include:
(a) engaging in anti-competitive cross-subsidisation;
(b) using information obtained from competitors with anti- competitive results; and
(c) not making available, on a timely basis, to suppliers of public telecommunications transport networks or services, technical information about essential facilities and commercially relevant information that is necessary for them to provide public telecommunications transport networks or services.
Co-Location
3. (a) A Party shall ensure that major suppliers in its territory provide to suppliers of public telecommunications transport networks or services of the other Party physical co-location, at premises owned or controlled by the major supplier, of equipment necessary for interconnection on terms and conditions, and at cost-oriented rates, that are reasonable, non-discriminatory, timely and transparent.
(b) Where physical co-location is not practical for technical reasons or because of space limitations, each Party shall ensure that major suppliers in its territory provide or facilitate virtual co- location on terms and conditions, and at cost oriented rates, that are reasonable, non-discriminatory, timely and transparent.
(c) Each Party may determine, in accordance with its national laws and regulations, which premises in its territory shall be subject to sub-paragraphs (a) and (b).
Poles, Ducts, and Conduits
4. (a) A Party shall ensure that major suppliers in its territory provide access to poles, ducts, and conduits, owned or controlled by such major suppliers to suppliers of public telecommunications transport networks or services of the other Party, under terms, conditions, and cost-oriented rates, that are reasonable, non- discriminatory (including with respect to timeliness), and transparent.
(b) Nothing shall prevent a Party from determining, under its domestic law and regulation, which particular structures owned or controlled by the major suppliers in its territory, are required to be made available in accordance with sub-paragraph (a) provided that this is based on a determination that such structures cannot feasibly be economically or technically substituted in order to provide a competing service.
Number Portability
5. Each Party shall ensure that major suppliers in its territory provide number portability to the extent technically feasible, on a timely basis and on reasonable terms and conditions.
Interconnection
6. (a) General Terms and Conditions
A Party shall ensure that any major supplier in its territory provides interconnection for the facilities and equipment of suppliers of public telecommunications transport networks or services of the other Party:
(i) at any technically feasible point in the major supplier’s network;
(ii) under non-discriminatory terms, conditions (including technical standards and specifications), and rates;
(iii) of a quality no less favourable than that provided by such major supplier for its own like services or for like services of non-affiliated suppliers of public telecommunications transport networks or services or for its subsidiaries or other affiliates;
(iv) in a timely fashion, on terms, conditions, (including technical standards and specifications), and cost-oriented rates, that are transparent, reasonable, having regard to economic feasibility, and sufficiently unbundled so that the supplier of public telecommunications transport networks or services need not pay for network components or facilities that it does not require for the service to be provided; and
(v) upon request, at points in addition to the network termination points offered to the majority of suppliers of public telecommunications transport networks or services, subject to charges that reflect the cost of construction of necessary additional facilities (5).
(b) Public Availability of the Procedures for Interconnection Negotiations
Each Party shall make publicly available the applicable procedures for interconnection negotiations with major suppliers in its territory.
(c) Public Availability of Interconnection Agreements concluded with Major Suppliers
(i) each Party shall require major suppliers in its territory to file all interconnection agreements to which they are party with its telecommunications regulatory body.
(ii) each Party shall make available for inspection to suppliers of public telecommunications transport networks or services which are seeking interconnection, interconnection agreements in force between a major supplier in its territory and any other supplier of public telecommunications transport networks or services in such territory.
(d) Resolution of Interconnection Disputes
A Party shall ensure that suppliers of public telecommunications transport networks or services of the other Party, that have requested interconnection with a major supplier in the Party’s territory, has recourse to a telecommunications regulatory body to resolve disputes regarding the terms, conditions, and rates for interconnection within a reasonable and publicly available period of time.
Article 12.5. Submarine Cable Landing Stations
A Party shall ensure reasonable and non-discriminatory access to submarine cable capacity, and cross-connect links in and backhaul links from, a submarine cable landing station for suppliers of public telecommunications transport networks or services of the other Party.
Article 12.6. Independent Regulation
1. Each Party shall ensure that its telecommunications regulatory body is separate from, and not accountable to, any supplier of public telecommunications transport networks or services.
2. Each Party shall ensure that the decisions of, and procedures used by its telecommunications regulatory body is impartial with respect to all suppliers of public telecommunications transport networks or services.
Article 12.7. Universal Service
Each Party shall administer any universal service obligation that it maintains in a transparent, non-discriminatory, and competitively neutral manner and shall ensure that its universal service obligation is not more burdensome than necessary for the kind of universal service that it has defined.
Article 12.8. Licensing Process
1. When a Party requires a supplier of public telecommunications transport networks or services to have a license or concession, the Party shall make publicly available:
(a) all the licensing criteria and procedures it applies;