(a) the implementation and operation of the provisions of this Agreement governing importations or exportations, including claims of origin and origin procedures;
(b) the implementation and operation of the Customs Valuation Agreement;
(c) restrictions or prohibitions on imports or exports; and
(d) other customs matters as the Parties may agree.
3. Where a Party has a reasonable suspicion of unlawful activity related to its laws or regulations governing importations, the Party may request the other Party to provide specific confidential information it normally collects in connection with the importation of goods.
4. For purposes of paragraph 3, “a reasonable suspicion of unlawful activity” means a suspicion based on relevant factual information obtained from public or private sources comprising one or more of the following:
(a) historical evidence of non-compliance with laws or regulations governing importations by an importer or exporter;
(b) historical evidence of non-compliance with laws or regulations governing importations by a manufacturer, producer, or other person involved in the movement of goods from the territory of one Party to the territory of the other Party;
(c) historical evidence that some or all of the persons involved in the movement from the territory of one Party to the territory of the other Party of goods within a specific product sector have not complied with a Party’s laws or regulations governing importations; or
(d) other information that the Parties agree is sufficient in the context of a particular request.
5. A Party’s request under paragraph 3 shall be in writing, shall specify the purpose for which the information is sought, and shall identify the requested information with sufficient specificity for the other Party to locate and provide the information.
6. The Party from which the information is requested shall, in accordance with its law and any relevant international agreements to which it is a party, provide a written response containing the information.
7. Each Party shall endeavor to provide the other Party with any other information that would assist that Party in determining whether an importer or exporter of that Party is in compliance with that Party’s laws or regulations governing importations, in particular those related to the prevention of smuggling and similar infractions.
8. In order to facilitate bilateral trade, each Party shall endeavor to provide the other Party with technical advice and assistance for the purpose of improving its risk assessment techniques, simplifying and expediting its customs procedures, advancing the technical skill of its personnel, and enhancing its use of technologies that can lead to improved compliance with regard to its laws or regulations governing importations.
Article 5.6. Confidentiality
1. Where a Party providing information to the other Party in accordance with this Chapter designates the information as confidential, the other Party shall maintain the confidentiality of the information. The Party providing the information may require written assurances from the other Party that the information will be held in confidence, will be used only for the purposes specified in the other Party’s request for information, and will not be disclosed without the Party’s specific permission.
2. A Party may decline to provide information requested by the other Party where that Party has failed to act in conformity with assurances provided under paragraph 1.
3. Each Party shall adopt or maintain procedures in which confidential information, including information the disclosure of which could prejudice the competitive position of the person providing the information, submitted in accordance with the administration of the Party’s customs laws, shall be protected from unauthorized disclosure.
Article 5.7. Express Shipments
Each Party shall adopt or maintain expedited customs procedures for express shipments while maintaining appropriate customs control and selection. These procedures shall:
(a) provide a separate, expedited customs procedure for express shipments;
(b) provide for the submission and processing of information necessary for the release of an express shipment before the express shipment arrives;
(c) allow submission of a single manifest covering all goods contained in a shipment transported by an express shipment service, through, if possible, electronic means;
(d) to the extent possible, provide for certain goods to be cleared through customs with a minimum of documentation;
(e) under normal circumstances, provide for express shipments to be cleared within six hours after the necessary customs documents have been submitted, provided the shipment has arrived;
(f) apply without regard to an express shipment’s weight or customs value; and
(g) under normal circumstances, provide that no customs duties or taxes will be assessed on, nor will formal entry documents be required for, express shipments valued at US$100 or less. (2)
Article 5.8. Review and Appeal
Each Party shall ensure that with respect to its determinations on customs matters, importers in its territory have access to:
(a) a level of administrative review independent of the employee or office that issued the determination; and
(b) judicial review of the determination.
Article 5.9. Penalties
Each Party shall adopt or maintain measures that allow for the imposition of civil or administrative penalties and, where appropriate, criminal sanctions for violations of its customs laws and regulations, including those governing tariff classification, customs valuation, country of origin, and claims for preferential treatment under this Agreement.
Article 5.10. Advance Rulings
1. Each Party, through its customs authority, shall issue, before a good is imported into its territory, a written advance ruling at the written request of an importer in its territory, or an exporter or producer in the territory of the other Party with regard to:
(a) tariff classification;
(b) the application of customs valuation criteria for a particular case, in accordance with the application of the provisions set out in the Customs Valuation Agreement;
(c) the application of duty drawback, deferral, or other relief from customs duties;
(d) whether a good is originating;
(e) whether a good re-entered into the territory of a Party after being exported to the territory of the other Party for repair or alteration is eligible for duty free treatment in accordance with Article 3.6 (Goods Re-entered after Repair or Alteration);
(f) country of origin marking;
(g) the application of quotas; and
(h) such other matters as the Parties may agree.
2. Each Party shall provide that its customs authority shall issue an advance ruling within 150 days after a request, provided that the requester has submitted all information that the Party requires, including, if the authority requests, a sample of the good for which the requester is seeking an advance ruling. In issuing an advance ruling, the customs authority shall take into account facts and circumstances the requester has provided.
3. Each Party shall provide that advance rulings shall take effect on the date they are issued, or on another date specified in the ruling, provided that the facts or circumstances on which the ruling is based remain unchanged.
4. The issuing Party may modify or revoke an advance ruling after the Party notifies the requester. The issuing Party may modify or revoke a ruling retroactively only if the ruling was based on inaccurate or false information.
5. Subject to any confidentiality requirements in its law, each Party shall make its advance rulings publicly available.
6. If a requester provides false information or omits relevant facts or circumstances relating to the advance ruling, or does not act in accordance with the ruling’s terms and conditions, the importing Party may apply appropriate measures, including civil, criminal, and administrative actions, monetary penalties, or other sanctions.
Article 5.11. Panamanian Free Zone Monitoring Program
1. Panama shall maintain its existing program of monitoring the importation, exportation, processing, and manipulation of goods in Panamanian free zones.
2. If the United States has a reasonable suspicion that a good for which an importer in the United States has made a claim for preferential tariff treatment under another free trade agreement to which the United States is a party has undergone further processing or operations in a Panamanian free zone, other than unloading, reloading, or any other operation necessary to preserve the good in good condition or transport it to the territory of the United States, then the United States may request in writing that Panama:
(a) make available all records identified in the written request that relate to whether the good or an identical good, as defined in Article 4.23 (Definitions), was imported into, exported from, or processed or manipulated in a free zone; or
(b) conduct a visit to a free zone to verify whether such good was imported into, exported from, or processed or manipulated in the free zone.
Panama shall promptly grant any such request, except as provided in paragraph 5. In the written request, the United States shall state that it has a reasonable suspicion as described above.
3. The United States may request in writing that a U.S. official attend a visit under paragraph 2(b), and Panama shall grant any such request. (3)
4. Where Panama conducts a visit that U.S. officials do not attend, Panama shall, promptly after the conclusion of the visit, report the findings of such visit in writing to the United States.
5. If Panama denies a written request made under paragraph 2, Panama shall provide a written explanation for such denial and shall enter into consultations with the United States within 30 days of the request under paragraph 2 with a view to resolving the matter to the satisfaction of the Parties. If the Parties are unable to resolve the matter in these consultations, either Party may refer the matter to the Commission.
6. For greater certainty, nothing in this Article shall require a shipper or exporter of a good from a Panamanian free zone to the territory of the United States or an importer of a good from a Panamanian free zone into the territory of the United States to collect, retain, or report information in addition to the information the United States requires in accordance with this Agreement or otherwise requires to ensure compliance with U.S. laws or regulations governing importations of goods.
7. The United States shall treat any information that Panama provides pursuant to paragraphs 2, 4 and 5 as if Panama has designated it as confidential information, as provided in Article 5.6.
Article 5.12. Application of Certain Provisions
Panama may delay giving effect to:
(a) Articles 5.1.1 and 5.1.2 for a period of no longer than two years;
(b) Articles 5.3 and 5.4 for a period of no longer than three years;
(c) Article 5.7 for a period of no longer than one year; and
(d) Article 5.10 for a period of no longer than two years,
beginning on the date of entry into force of this Agreement.
Chapter Six . Sanitary and Phytosanitary Measures
Objectives
The objectives of this Chapter are to protect human, animal, or plant life or health in the Parties’ territories, enhance the Parties’ implementation of the SPS Agreement, provide a forum for addressing sanitary and phytosanitary matters, facilitate the resolution of trade issues, and thereby expand trade opportunities.
Article 6.1. Affirmation of the SPS Agreement
Further to Article 1.3 (Relation to Other Agreements), the Parties affirm their existing rights and obligations with respect to each other under the SPS Agreement.
Article 6.2. Scope and Coverage
1. This Chapter applies to all sanitary and phytosanitary measures of a Party that may, directly or indirectly, affect trade between the Parties.
2. Neither Party may have recourse to dispute settlement under this Agreement for any matter arising under this Chapter.
Article 6.3. Committee on Sanitary and Phytosanitary Matters
1. Not later than 30 days after the date of entry into force of this Agreement, the Parties shall establish a Committee on Sanitary and Phytosanitary Matters, comprising representatives of each Party that have responsibility for sanitary and phytosanitary matters, as set out in Annex 6.3.
2. The Parties shall establish the Committee through an exchange of letters identifying the primary representative of each Party to the Committee and establishing the Committee’s terms of reference.
3. The objectives of the Committee shall be to help each Party implement the SPS Agreement, assist each Party to protect human, animal, or plant life or health, enhance consultation and cooperation on sanitary and phytosanitary matters, and facilitate trade between the Parties.
4. The Committee shall seek to promote communication and otherwise enhance present or future relationships between the Parties’ agencies and ministries with responsibility for sanitary and phytosanitary matters.
5. The Committee shall endeavor to ensure that sanitary and phytosanitary matters raised in the Committee are addressed in a timely manner.
6. The Committee may establish ad hoc working groups in accordance with its terms of reference.
7. The Committee shall provide a forum for:
(a) enhancing mutual understanding of each Party’s sanitary and phytosanitary measures and the regulatory processes that relate to those measures;
(b) consulting on matters related to the development or application of sanitary and phytosanitary measures that affect, or may affect, trade between the Parties;
(c) reviewing progress on sanitary and phytosanitary matters that may arise between the Parties’ relevant agencies and ministries with a view to facilitating trade between the Parties.
(d) consulting on issues, positions, and agendas for meetings of the WTO SPS Committee, the various Codex committees (including the Codex Alimentarius Commission), the International Plant Protection Convention, the International Office of Epizootics, and other international and regional fora on food safety and human, animal, and plant health;
(e) making recommendations on technical cooperation programs on sanitary and phytosanitary matters to the Committee on Trade Capacity Building; and
(f) improving the Parties’ understanding of specific issues relating to the implementation of the SPS Agreement.
8. Each Party shall ensure that appropriate representatives with responsibility for the
development, implementation, and enforcement of sanitary and phytosanitary measures from its relevant trade and regulatory agencies or ministries participate in meetings of the Committee.
9. The Committee shall meet at least once a year unless the Parties otherwise agree.
10. The Committee shall perform its work in accordance with its terms of reference. The
Committee may revise its terms of reference and establish procedures to guide its operation.
11. All decisions of the Committee shall be taken by mutual agreement.
Chapter Seven. Technical Barriers to Trade
Objectives
The objectives of this Chapter are to increase and facilitate trade through the improvement of the implementation of the TBT Agreement, the elimination of unnecessary technical barriers to trade, and the enhancement of bilateral cooperation.
Article 7.1. Affirmation of the TBT Agreement
Further to Article 1.3 (Relation to Other Agreements), the Parties affirm their existing rights and obligations with respect to each other under the TBT Agreement.
Article 7.2. Scope and Coverage
1. This Chapter applies to all standards, technical regulations, and conformity assessment procedures of the Parties’ central government bodies that may, directly or indirectly, affect trade in goods between the Parties. (1)
2. Notwithstanding paragraph 1, this Chapter does not apply to:
(a) technical specifications prepared by governmental bodies for production or consumption requirements of such bodies; and
(b) sanitary and phytosanitary measures.
Article 7.3. International Standards
In determining whether an international standard, guide, or recommendation within the meaning of Articles 2 and 5 and Annex 3 of the TBT Agreement exists, each Party shall apply the principles set out in Decisions and Recommendations adopted by the Committee since 1 January 1995, G/TBT/1/Rev.8, 23 May 2002, Section IX (Decision of the Committee on Principles for the Development of International Standards, Guides and Recommendations with relation to Articles 2, 5 and Annex 3 of the Agreement) issued by the WTO Committee on Technical Barriers to Trade.
Article 7.4. Trade Facilitation
1. The Parties shall intensify their joint work in the field of standards, technical regulations, and conformity assessment procedures with a view to facilitating trade between the Parties. In particular, the Parties shall seek to identify trade facilitating initiatives regarding standards, technical regulations, and conformity assessment procedures that are appropriate for particular issues or sectors. Such initiatives may include cooperation on regulatory issues, such as convergence, alignment with international standards, reliance on a supplier’s declaration of conformity, and use of accreditation to qualify conformity assessment bodies.
2. On request of a Party, the other Party shall give favorable consideration to any sector- specific proposal the requesting Party makes for further cooperation under this Chapter.
Article 7.5. Conformity Assessment
1. The Parties recognize that a broad range of mechanisms exists to facilitate the acceptance in a Party’s territory of the results of conformity assessment procedures conducted in the other Party’s territory. For example:
(a) the importing Party may rely on a supplier’s declaration of conformity;
(b) a conformity assessment body located in the territory of a Party may enter into a voluntary arrangement with a conformity assessment body located in the territory of the other Party to accept the results of each other’s assessment procedures;
(c) a Party may agree with the other Party to accept the results of conformity assessment procedures that bodies located in the other Party’s territory conduct with respect to specific technical regulations;
(d) a Party may adopt accreditation procedures for qualifying conformity assessment bodies located in the territory of the other Party;
(e) a Party may designate conformity assessment bodies located in the territory of the other Party; and
(f) a Party may recognize the results of conformity assessment procedures conducted in the territory of the other Party.
The Parties shall intensify their exchange of information on these and other similar mechanisms.
2. Where a Party does not accept the results of a conformity assessment procedure conducted in the territory of the other Party, it shall, on request of the other Party, explain its reasons.
3. Each Party shall accredit, approve, license, or otherwise recognize conformity assessment bodies in the territory of the other Party on terms no less favorable than those it accords to conformity assessment bodies in its territory. Where a Party accredits, approves, licenses, or otherwise recognizes a body assessing conformity with a specific technical regulation or standard in its territory and refuses to accredit, approve, license, or otherwise recognize a body assessing conformity with that technical regulation or standard in the territory of the other Party, it shall, on request of the other Party, explain the reasons for its decision.
4. Where a Party declines a request from the other Party to engage in negotiations or conclude an agreement on facilitating recognition in its territory of the results of conformity assessment procedures conducted by bodies in the other Party’s territory, it shall, on request of the other Party, explain the reasons for its decision.
Article 7.6. Technical Regulations
1. Where a Party provides that foreign technical regulations may be accepted as equivalent to a specific technical regulation of its own, and the Party does not accept a technical regulation of the other Party as equivalent to that technical regulation, it shall, at the request of the other Party, explain the reasons for its decision.
2. Where a Party does not provide that foreign technical regulations may be accepted as equivalent to its own, it may, at the request of the other Party, explain its reasons for not accepting the other Party’s technical regulations as equivalent.
Article 7.7. Transparency
1. Each Party shall allow persons of the other Party to participate in the development of its standards, technical regulations, and conformity assessment procedures. Each Party shall permit persons of the other Party to participate in the development of such measures on terms no less favorable than those accorded to its own persons.
2. Each Party shall recommend that non-governmental standardizing bodies in its territory observe paragraph 1.
3. In order to enhance the opportunity for persons to provide meaningful comments on proposed technical regulations and conformity assessment procedures, a Party publishing a notice under Article 2.9 or 5.6 of the TBT Agreement shall:
(a) include in the notice a statement describing the objective of the proposed technical regulation or conformity assessment procedure and the rationale for the approach the Party is proposing; and
(b) transmit the proposal electronically to the other Party through the inquiry points each Party has established under Article 10 of the TBT Agreement at the same time as it notifies WTO Members of the proposal pursuant to the TBT Agreement.
Each Party should allow at least 60 days after it transmits a proposal under subparagraph (b) for persons and the other Party to make comments in writing on the proposal.
4. Each Party shall publish or otherwise make available to the public, in print or electronically, its responses to significant comments it receives from persons or the other Party under paragraph 3 no later than the date it publishes the final technical regulation or conformity assessment procedure.
5. Where a Party makes a notification under Article 2.10 or 5.7 of the TBT Agreement, it shall at the same time transmit the notification electronically to the other Party through the inquiry points referenced in paragraph 3(b).
6. Each Party shall, on request of the other Party, provide information regarding the objective of, and rationale for, a standard, technical regulation, or conformity assessment procedure that the Party has adopted or is proposing to adopt.
7. Where a Party detains at a port of entry a good originating in the territory of the other Party due to a perceived failure to comply with a technical regulation, it shall immediately notify the importer of the reasons for the detention.
8. Each Party shall implement this Article as soon as is practicable and in no event later than five years from the date of entry into force of this Agreement.
Article 7.8. Committee on Technical Barriers to Trade
1. The Parties hereby establish the Committee on Technical Barriers to Trade, comprising representatives of each Party, as set out in Annex 7.8.
2. The Committee’s functions shall include:
(a) monitoring the implementation and administration of this Chapter;
(b) promptly addressing any issue that a Party raises related to the development, adoption, application, or enforcement of standards, technical regulations, or conformity assessment procedures;
(c) enhancing cooperation in the development and improvement of standards, technical regulations, and conformity assessment procedures and, as appropriate, designing and proposing mechanisms for technical assistance of the type described in Article 11 of the TBT Agreement, in coordination with the Committee on Trade Capacity Building, as appropriate;
(d) where appropriate, facilitating sectoral cooperation between governmental and non-governmental conformity assessment bodies in the Parties’ territories;
(e) exchanging information on developments in non-governmental, regional, and multilateral fora engaged in activities related to standards, technical regulations, and conformity assessment procedures;
(f) at a Party’s request, consulting on any matter arising under this Chapter;
(g) at a Party’s request, consulting on any matter arising under the TBT Agreement;
(h) reviewing this Chapter in light of any developments under the TBT Agreement, and developing recommendations for amendments to this Chapter in light of those developments;