Permanent Unit
62. Each Party shall designate a permanent Unit to provide administrative support to the arbitral tribunal. Once designated, its address shall be communicated to the Bilateral Administrative Commission no later than sixty (60) days from the date of entry into force of this Agreement.
Costs and Other Associated Expenses
63. Each Party shall bear the cost of the arbitrator it appoints or should have appointed pursuant to Article 17.8, as well as the cost of any assistants, travel, accommodation and other expenses associated with the conduct of the proceeding.
64. The costs of the presiding arbitrator, his or her assistants, if any, travel, lodging and other expenses associated with the proceedings shall be borne by the Parties in equal proportions.
65. Each arbitrator shall keep a complete record of the expenses incurred and submit a settlement, together with supporting documents, for the purpose of determining their appropriateness and subsequent payment. The same shall apply to assistants and experts.
66. The amount of the fees of the arbitrators, their assistants and experts, as well as the expenses that may be authorized, shall be established by the Bilateral Administrative Commission. In determining the amount of the arbitrators' fees, the Bilateral Administrative Commission shall use as a reference the WTO schedule of fees for non-governmental arbitrators in a WTO dispute.
67. Where the chairman of the arbitral tribunal or an arbitrator requires one or more assistants for the conduct of the arbitral tribunal's work, this shall be agreed upon by both parties.
Arbitral Tribunal for the Review of Compliance and Suspension of Benefits
68. Without prejudice to the foregoing rules, in the case of a proceeding conducted pursuant to Article 17.18 the following shall apply:
(a) where a Party requests the establishment of the arbitral tribunal, it shall deliver its initial written statement within five (5) days after the constitution of the arbitral tribunal pursuant to Article 17.18;
(b) the other Party shall deliver its written counter-submission within fifteen (15) days of the date of receipt of the initial written submission, and
(c) subject to the time limits set forth in the Agreement and these Rules, the arbitral tribunal shall establish the time limit for the delivery of any supplementary documents, ensuring that each Party has an equal opportunity to submit documents.
Procedure for the selection of the Chairman of the Arbitral Tribunal in case of non- appointment
69. Unless the Parties agree otherwise, the following procedure shall apply for the purpose of selecting the presiding arbitrator pursuant to Article 17.8:
(a) the drawing of lots shall take place in the capital of the complaining Party;
(b) the complaining Party shall notify the Party complained against of the date of the drawing of lots at least five (5) days in advance. The Party complained against shall designate a representative to be present during the drawing of lots;
(c) the complaining Party shall provide a container containing envelopes containing the names of the candidates for the presiding arbitrators of the arbitral tribunal, in accordance with Article 17.8. The Party complained against shall check each envelope before it is sealed for the drawing of lots;
(d) after all the envelopes have been sealed and placed in the container, the representative of the Party complained against shall draw one of the envelopes, at random and without any possibility of discerning the identity of the candidate whose name is on the envelope;
(e) the candidate whose name is on the envelope drawn shall be the chairman of the arbitral tribunal,
(f) after the selection of the chairman of the arbitral tribunal, the procedure set out in this Rule shall apply to the selection of his alternate.
70. If, after the notification referred to in Rule 69(b), the representative of the Party complained against fails to appear at the drawing of lots, or if such representative refuses to draw an envelope from the container in accordance with Rule 69(d), the complaining Party shall draw the envelope.
71. Ifa Party fails to submit its list of candidates, the president of the arbitral tribunal shall be appointed by drawing lots from the list submitted by the other Party.
Procedure for selecting an Arbitrator in case of non-appointment
72. Ifa Party fails to appoint its arbitrator within the time period provided for in Article 17.8, the arbitrator shall be appointed by the other Party from the indicative list of WTO panelists for the Party that failed to appoint the arbitrator. In the event that candidates from that list are not available, the arbitrator shall be selected from the indicative list of WTO panelists for any Member other than a Party.
Annex 17.2. CODE OF CONDUCT FOR ARBITRAL DISPUTE RESOLUTION PROCEEDINGS
Preamble
Considering that the Parties attach paramount importance to the integrity and fairness of proceedings conducted pursuant to this Chapter, the Parties establish this Code of Conduct pursuant to Article 17.7. 1.
Definitions
For the purposes of this Code of Conduct:
arbitrator means the person selected under Article 17.8 to serve on an arbitral tribunal;
adviser or expert means a person who provides technical information or advice under Rule 49 of the Rules;
assistant means a person who provides support to the referee;
Affidavit means the Affidavit of Confidentiality and Code of Conduct Compliance attached to this Code of Conduct;
family member means the arbitrator's spouse, cohabitant or common-law spouse, relatives by blood and affinity, stepfamilies and the spouses of such persons;
proceedings, unless otherwise specified, means the proceedings of an arbitral tribunal under this Chapter;
Rules means the Rules of Procedure of Arbitral Tribunals, and arbitral tribunal means the arbitral tribunal established under Article 17.5. 2.
Current Principles
(a) Each arbitrator shall be independent and impartial and shall avoid direct or indirect conflicts of interest. He or she shall not receive instructions from any government or governmental or non-governmental organization.
(b) Each arbitrator and former arbitrator shall respect the confidentiality of the proceedings of the arbitral tribunal.
(c) Each arbitrator must disclose the existence of any interest, relationship or matter that might bear on his or her independence or impartiality and that might reasonably create an appearance of impropriety or a fear of bias. An appearance of impropriety or fear of bias exists when a reasonable person, with knowledge of all relevant circumstances that a reasonable inquiry might reveal, would conclude that an arbitrator's ability to perform his or her duties with integrity, impartiality and competence is impaired.
(d) This Code of Conduct does not state under what circumstances the Parties will disqualify an arbitrator on the basis of a disclosure.
3. Responsibilities towards the Procedure
Each arbitrator and former arbitrator shall avoid being or appearing improper and shall maintain a high standard of conduct to preserve the integrity and fairness of the dispute resolution process.
4. Disclosure Obligations
(a) Throughout the proceedings, arbitrators have a continuing obligation to disclose interests, relationships and matters that may be linked to the integrity or fairness of the arbitration dispute resolution proceedings.
(b) As expeditiously as possible, after it is known that a person is being considered for membership on the arbitral tribunal, the responsible unit shall provide that person with a copy of this Code of Conduct and the Affidavit.
(c) The person being considered for appointment to the arbitral tribunal shall have three (3) days to accept his or her appointment as arbitrator, in which case he or she shall return the duly signed Affidavit to the responsible unit. The person being considered for appointment to the arbitral tribunal shall disclose any interest, relationship or matter that might influence his or her independence or impartiality or that might reasonably create the appearance of impropriety or a fear of bias in the proceeding. To this end, such person shall make all reasonable efforts to become aware of such interests, relationships and matters. Accordingly, he or she shall disclose, at a minimum, the following interests, relationships and matters:
(i) any financial or personal interest in:
(A) the procedure or its outcome, and
(B) an administrative proceeding, a domestic judicial proceeding or other international dispute settlement procedure, or an international disputes involving issues that can be decided in the proceeding for which it is being considered;
(ii) any financial interest of the employer, partner, associate or family member in:
(A) the procedure or its outcome, and
(B) an administrative proceeding, national judicial proceeding or other international dispute settlement proceeding involving issues that can be decided in the proceeding for which it is being considered;
(iii) any current or former relationship of a business, commercial, professional, family or social nature with any of the parties to the proceeding or their counsel or any such relationship involving their employer, partner, associate or family member; and
(iv) public advocacy or legal or other representation on any matter in controversy in the proceeding or involving the same goods or services.
(d) Once appointed, the arbitrator shall continue to make every reasonable effort to become aware of any interest, relationship or matter referred to in subparagraph (c) and shall disclose them. The duty of disclosure is an ongoing duty requiring an arbitrator to disclose any interest, personal relationship and matter that may arise at any stage of the proceeding.
(e) If there is any doubt as to whether an interest, personal relationship or matter should be disclosed under subparagraph (c) or (d), the arbitrator must choose in favour of disclosure. Disclosure of an interest, personal relationship or matter is without prejudice to whether the interest, personal relationship or matter is covered by subparagraphs (c) or (d), or whether it warrants cure under subsection 6(g) or disqualification.
(f) The disclosure obligations set forth between subparagraphs (a) and (e) should not be interpreted in such a way that the burden of detailed disclosure would make it impractical to serve as arbitrators to persons in the legal or business community, thereby depriving the Parties of the services of those who might be best qualified to serve as arbitrators.
5. Performance of duties by the Arbitrators
(a) Bearing in mind that the prompt settlement of disputes is essential to the effective functioning of the Agreement, the arbitrator shall perform his or her duties in a thorough and expeditious manner throughout the course of the proceedings.
(b) Each arbitrator shall ensure that the responsible unit can, at all reasonable times, contact the arbitrator to carry out the tasks of the arbitral tribunal.
(c) Every arbitrator shall perform his or her duties fairly and diligently.
(d) An arbitrator shall comply with the provisions of this Chapter and the Rules.
(e) An arbitrator shall not deny the other arbitrators on the arbitral tribunal the opportunity to participate in all aspects of the proceedings.
(f) An arbitrator shall not make ex parte contacts in relation to the proceeding in accordance with Rules 46, 47 and 48 of the Rules.
(g) An arbitrator shall consider only such matters presented in the proceedings as are necessary to make a decision and shall not delegate his or her decision making duties to any other person.
(h) Each Arbitrator shall take the necessary steps to ensure that his or her assistants comply with paragraphs 3 (Responsibilities to the Proceeding), 4 (Disclosure Obligations), 5(d) (Rules), 5(h) (Ex Parte Contacts) and 8 (Confidentiality) of this Code of Conduct.
(i) No arbitrator shall disclose matters relating to actual or potential violations of this Code of Conduct unless the disclosure is with both standing units and addresses the need to determine whether an arbitrator has violated or may violate the Code.
6. Independence and Impartiality of Arbitrators
(a) An arbitrator shall be independent and impartial. An arbitrator shall act fairly and shall not create the appearance of impropriety or a fear of bias.
(b) An arbitrator shall not be influenced by self-interest, outside pressure, political considerations, public pressure, loyalty to a Party or fear of criticism.
(c) An arbitrator may not, directly or indirectly, incur any obligation or accept any benefit that would in any way interfere, or appear to interfere, with the proper performance of his or her duties.
(d) An arbitrator shall not use his or her position on the arbitral tribunal to promote personal or private interests. An arbitrator shall avoid actions that may create the impression that others are in a special position to influence him or her. An arbitrator shall make every effort to prevent or discourage others from purporting to have such influence.
(e) An arbitrator shall not allow his or her past or present financial, business, professional, family or social relationships or responsibilities to influence his or her conduct or judgment.
(f) An arbitrator shall avoid entering into any relationship or acquiring any financial interest which is likely to influence his or her impartiality or which might reasonably create the appearance of impropriety or a fear of bias.
(g) If an arbitrator's interest, personal relationship or matter is incompatible with subparagraphs (a) through (f), the arbitrator may accept appointment to an arbitral tribunal or may continue to serve on an arbitral tribunal, as appropriate, if the Parties waive the violation or if, after the arbitrator has taken steps to cure the violation, the Parties determine that the incompatibility no longer exists.
7. Duties of Former Arbitrators
A former arbitrator shall ensure that his or her actions do not create the appearance that he or she was biased in the performance of his or her duties or that he or she might have benefited from the decisions of the arbitral tribunal.
8. Confidentiality
(a) An arbitrator or former arbitrator shall not at any time disclose or use confidential information relating to a proceeding or acquired during a proceeding except for the purposes of the proceeding itself, nor shall he or she disclose or use such information for personal gain or for the benefit of others or to adversely affect the interests of others.
(b) An arbitrator shall not disclose an award of the arbitral tribunal rendered under Chapter 17 (Dispute Resolution) before the Parties publish the final award. Arbitrators or former arbitrators shall not disclose at any time the identity of the arbitrators in the majority or minority in a proceeding under Chapter 17 (Dispute Resolution).
(c) An arbitrator or former arbitrator shall not at any time disclose the deliberations of an arbitral tribunal or the opinion of an arbitrator, except as required by law.
(d) An arbitrator shall not make public statements about the merits of a pending proceeding.
9. Responsibilities of Assistants, Advisors and Experts Paragraphs 3 (Responsibilities to the Proceedings), 4 (Disclosure Obligations), 5(d) (Rules), 5(h) (Ex Parte Contacts), 7 (Obligations of Former Arbitrators) and 8 (Confidentiality) of this Code of Conduct also apply to assistants, advisers and experts.
Appendix 17.2.1. AFFIDAVIT OF CONFIDENTIALITY AND COMPLIANCE WITH THE CODE OF CONDUCT
1. I acknowledge that I have received a copy of the Code of Conduct for Arbitral Dispute Settlement Procedures under Chapter 17 (Dispute Settlement) of the Trade Agreement between the Republic of Chile and the Republic of Paraguay (the "Code of Conduct").
2. I acknowledge that I have read and understood the Code of Conduct.
3. I understand that I have a continuing obligation to disclose interests, personal relationships and matters that may be related to the integrity or fairness of the arbitration dispute resolution proceeding. As part of that obligation, I make the following affidavit:
(a) My financial interest in the proceedings or their outcome is as follows:
(b) My pecuniary interest in any administrative proceedings, domestic judicial proceedings and other international dispute settlement proceedings relating to matters that may be decided in the proceeding for which I am under consideration is as follows:
(c) The economic interests that any employer, partner, associate or family member may have in the proceedings or their outcome are as follows:
(d) The economic interests that any employer, partner, associate or family member may have in any administrative proceeding, domestic judicial proceeding and other international dispute settlement proceeding involving matters that may be decided in the proceeding for which I am under consideration are as follows:
(e) My past or present financial, business, professional, family or social relationships with any party to the proceeding or its counsel are as follows:
(f) My past or present financial, business, professional, family or social relationships with any party to the proceeding or its counsel, involving any employer, partner, associate or family member, are as follows:
(g) My public advocacy or legal or other representation relating to any matter at issue in the proceeding or involving the same goods or services is as follows:
(h) My other interests, relationships and matters that may affect the integrity or fairness of the dispute resolution proceeding and that have not been disclosed in subparagraphs (a) through (g) in this opening statement are as follows:
Subscribed on the day of the month of _____ of the year_______.
By:
Name:
Signature:
Chapter 18. GENERAL EXCEPTIONS
Article 18.1. General Exceptions
1. For the purposes of Chapters 2 (Trade Facilitation), 4 (Sanitary and Phytosanitary Measures), 5 (Technical Barriers to Trade) and 7 (Electronic Commerce) of this Agreement, Article XX of GATT 1994 and its interpretative notes are incorporated into and made part of this instrument, mutatis mutandis.
2. For the purposes of this Agreement, the Parties understand that the measures referred to in Article XX(b) of GATT 1994 include environmental measures necessary to protect human, animal or plant life or health, and that Article XX(g) of GATT 1994 applies to measures relating to the conservation of living or non-living exhaustible natural resources.
3. For the purposes of Chapter 6 (Trade in Services) and Chapter 7 (Electronic Commerce)(1), paragraphs (a), (b) and (c) of Article XIV of the GATS are hereby incorporated into and made part of this Agreement, mutatis mutandis. The Parties understand that the measures referred to in Article XIV(b) of the GATS include environmental measures necessary to protect human, animal or plant life or health.
Article 18.2. Security Exceptions
1. For the purposes of this Agreement, Article XXI of GATT 1994 and Article XIV bis of GATS are hereby incorporated into and made part of this Agreement, mutatis mutandis.
2. Nothing in this Agreement shall be construed to mean:
(a) require a Party to provide or permit access to any information the disclosure of which it considers contrary to its essential security interests; or
(b) prevent a Party from taking any action for the fulfillment of its obligations with respect to the maintenance or restoration of international peace or security, or which it considers necessary for the protection of its own essential security interests.
Article 18.3. Disclosure of Information
Nothing in this Agreement shall be construed to require a Party to furnish or permit access to information the disclosure of which would be contrary to its legal system or would impede the application of the law, or would otherwise be contrary to the public interest, or would prejudice the legitimate commercial interests of particular enterprises, public or private.
Article 18.4. Temporary Safeguarding Measures
1. Nothing in this Agreement shall be construed to prevent a Party from adopting or maintaining measures restricting payments or transfers for current account transactions in the event that it experiences serious difficulties in, or threats to, its balance of payments and external finances.
2. Nothing in this Agreement shall be construed to prevent a Party from adopting or maintaining measures restricting payments or transfers related to capital movements:
(a) in the event of serious difficulties in, or threats to, its balance of payments and external finances; or
(b) where, in exceptional circumstances, payments or capital transfers cause or threaten to cause serious difficulties for macroeconomic management.
3. Any action taken or maintained under paragraph 1 or 2 shall:
(a) be applied in a non-discriminatory manner so that no Party is treated less favourably than a non-Party;
(b) be consistent with the Articles of Agreement of the International Monetary Fund;
(c) avoid unnecessary damage to the commercial, economic and financial interests of the other Party;
(d) not go beyond what is necessary to overcome the circumstances set out in paragraphs 1 or 2, and
(e) be temporary and be phased out as soon as the situations specified in paragraph 1 or 2 improve.
4. With respect to trade in goods, the Parties shall apply the Fifteenth Additional Protocol to ACE No. 35.
5. With respect to trade in services, nothing in this Agreement shall be construed to prevent a Party from adopting trade-restrictive measures so as to enable it to safeguard its external financial position or balance of payments. Such restrictive measures shall be consistent with the GATS.
6. A Party that adopts or maintains measures pursuant to paragraphs 1, 2, 4 or 5 shall:
(a) promptly notify the other Party of the measures adopted, including any changes thereto;
(b) promptly enter into consultations with the other Party to review the measures adopted or maintained by it:
(i) in the case of capital movements, respond promptly to the other Party requesting consultations regarding measures taken by it, provided that such consultations were not being conducted outside the framework of this Agreement,
(ii) in the case of current account restrictions, if consultations regarding the measures taken by it are not conducted within the framework of the WTO Agreement, the Party shall, if requested, promptly enter into consultations with the other Party.
Article 18.5. Taxation Measures
1. For the purposes of this Article:
designated authorities means:
(a) in the case of Chile, the Undersecretary of Finance, or his or her successor, and
(b) in the case of Paraguay, the Under-Secretary of State for Taxation, or his successor;
tax treaty means a convention for the avoidance of double taxation or other international agreement or arrangement in tax matters;
Taxes and tax measures include excise taxes, but do not include:
(a) any tariff or charge of any kind applied to or in connection with the importation of a good, and any form of surcharge or surtax applied in connection with such importation, or
(b) any duty or other charge related to importation commensurate with the cost of services rendered, or
(c) any anti-dumping duty or countervailing measure.
2. Except as provided in this Article, nothing in this Agreement shall apply to taxation measures.
3. Nothing in this Agreement shall affect the rights and obligations of either Party under any tax treaty. In the event of any inconsistency between this Agreement and any such tax treaty, that treaty shall prevail to the extent of the inconsistency.
4. In the case of a tax treaty between the Parties, if a dispute arises as to the existence of any inconsistency between this Agreement and the tax treaty, the dispute shall be referred to the Parties' designated authorities. The designated authorities of the Parties shall have six (6) months from the date of referral of the dispute to make a determination as to the existence and extent of any inconsistency. If those designated authorities so agree, the period may be extended to twelve (12) months from the date of referral of the dispute. No proceeding relating to the measure giving rise to the dispute may be initiated under Chapter 17 (Dispute Settlement) until the expiration of the six (6) month period, or such other period as may be agreed upon by the designated authorities. An arbitral tribunal established to hear a dispute relating to a taxation measure shall accept as binding the determination made by the designated authorities of the Parties under this paragraph.
5. Subject to paragraph 3:
(a) Article 6.3 (National Treatment) shall apply to taxation measures on income, capital gains, on the taxable capital of corporations, or on the value of an investment or property (but not on the transfer of such investment or property), that relate to the purchase or consumption of specified services, except that nothing in this subparagraph shall prevent a Party from conditioning the receipt or continued receipt of an advantage related to the purchase or consumption of specified services on requirements to supply the service in its territory, and
(b) Article 6.3 (National Treatment) shall apply to all tax measures, other than those on income, capital gains, on the taxable capital of corporations, on the value of an investment or property (3) (but not on the transfer of that investment or property), or estate, inheritance, gift, and generation-skipping transfer taxes;
but nothing in the Article referred to in subparagraphs (a) and (b) shall apply to:
(c) any most-favoured-nation obligation with respect to an advantage granted by a Party in accordance with a tax convention;