Title
FREE TRADE AGREEMENT BETWEEN
THE GOVERNMENT OF THE REPUBLIC OF CHILE
AND
THE GOVERNMENT OF THE KINGDOM OF THAILAND
Preamble
The Republic of Chile and the Kingdom of Thailand, hereinafter individually referred to as a "Party" or collectively as the "Parties":
Inspired by their longstanding friendship and cooperation and growing economic, trade and investment relationship;
Recognising that the strengthening of their economic partnership will bring economic and social benefits, create new opportunities for employment and improve the living standards of their people;
Creating an expanded and secure market for the goods and services produced in their territories;
Resolved to promote bilateral trade through the establishment of clear and mutually advantageous trade rules and the avoidance of trade barriers;
Promoting a predictable, transparent, and consistent business environment that will assist juridical persons to plan effectively and use resources efficiently;
Building on their respective rights and obligations under the World Trade Organization (WTO), other multilateral, regional and bilateral agreements to which they are both parties;
Recalling the Asia-Pacific Economic Cooperation (APEC) goals and aware of the growing importance of trade and investment for the economies of the Asia-Pacific region; and
Desiring to strengthen the cooperative framework for the conduct of economic relations to ensure it is dynamic and encourages broader and deeper economic cooperation;
HAVE AGREED AS FOLLOWS:
Body
Chapter 1. Initial Provisions
Article 1.1. Objectives
The objectives of this Agreement are to:
(a) liberalise and facilitate trade in goods and services between the Parties;
(b) facilitate the mutual recognition of the results of conformity assessment procedures for products or processes;
(c) liberalise, encourage and promote investment and ensure protection for investments and investment activities in the Parties;
(d) facilitate the movement of natural persons;
(e) ensure and enhance adequate, effective and non-discriminatory protection of trade between the Parties;
(f) enhance cooperation for mutual benefit of the Parties; and
(g) promote transparency in the implementation of laws and regulations respecting matters covered by this Agreement.
Article 1.2. Establishment of a Free Trade Area
The Parties, consistent with Article XXIV of the GATT 1994 and Article V of the GATS, hereby establish a free trade area.
Article 1.3. Relation to other Agreements
The Parties reaffirm their existing rights and obligations with respect to each other under the WTO Agreement and other agreements to which both Parties are party.
Chapter 2. General Definitions
Article 2.1. Definitions of General Application
For the purposes of this Agreement, unless otherwise specified:
Agreement means the Free Trade Agreement between Chile and Thailand;
APEC means Asia-Pacific Economic Cooperation;
Commission means the Free Trade Commission established under Article 13.1 (Free Trade Commission);
Customs authority means the authority that, according to the legislation of each Party, is responsible for the administration and enforcement of its customs laws and regulations:
(a) in the case of Chile, the Chile Customs Service; and
(b) in the case of Thailand, the Customs Department;
Customs duties includes any import duty and a charge of any kind imposed in connection with the importation of a good, but does not include any:
(a) charges equivalent to internal taxes, including excise duties, sales tax, and goods and services taxes imposed in accordance with a Party's commitments under paragraph 2 of Article III of GATT 1994;
(b) anti-dumping or countervailing duty or safeguards duty applied in accordance with Chapter 8 (Trade Remedies); or
(c) fees or other charges that are limited in amount to the approximate cost of services rendered, and do not represent a direct or indirect protection for domestic goods or a taxation of imports for fiscal purposes;
Customs Valuation Agreement means the Agreement on Implementation of Article VII of GATT 1994, contained in Annex 1A to the WTO Agreement;
Days means calendar days, including weekends and public holidays;
Existing means in effect on the date of entry into force of this Agreement;
GATS means the General Agreement on Trade in Services, contained in Annex 1B to the WTO Agreement;
GATT 1994 means the General Agreement on Tariffs and Trade 1994, contained in Annex 1A to the WTO Agreement;
Goods of a Party means domestic products as these are understood in GATT 1994 or such goods as the Parties may agree, and includes originating goods of that Party. A good of a Party may include materials of other countries;
Harmonized System (HS) means the Harmonized Commodity Description and Coding System governed by The International Convention on the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, and their amendments, as adopted and implemented by the Parties in their respective tariff laws;
Heading means the first four digits in the tariff classification number under the Harmonized System (HS);
Juridical person of a state means a juridical person that is owned or controlled through ownership interests by a Party;
Measure means any measure by a Party, whether in the form of a law, regulation, rule, procedure, practice, decision, administrative action or any other form;
National means:
(a) in the case of Chile, a natural person who has the Chilean nationality as defined in Article 10 of the Constitucidn Politico, de la Republica de Chile; and
(b) in the case of Thailand, any person who possesses Thai nationality under the law in force in the Kingdom of Thailand;
Originating means qualifying under the rules of origin set out in Chapter 4 (Rules of Origin);
Person means a natural person or a juridical person;
Person of a Party means a natural person or a juridical person of a Party;
Preferential tariff treatment means the duty rate applicable under this Agreement to an originating good;
Safeguards Agreement means the Agreement on Safeguards, contained in Annex 1A to the WTO Agreement;
SPS Agreement means the Agreement on the Application of Sanitary and Phytosanitary Measures, contained in Annex 1A to the WTO Agreement;
Subheading means the first six digits in the tariff classification number under the Harmonized System (HS);
TBT Agreement means the Agreement on Technical Barriers to Trade, contained in Annex 1A to the WTO Agreement;
Territory means:
(a) in the case of Chile, the land, maritime, and air space under its sovereignty, and the exclusive economic zone and the continental shelf within which it exercises sovereign rights and jurisdiction in accordance with international law and its domestic law; and
(b) in the case of Thailand, the territory of the Kingdom of Thailand, including its internal waters, exclusive economic zone, the continental shelf and any other maritime areas in which it exercises sovereign rights and jurisdiction in accordance with international law;
WTO means the World Trade Organization; and
WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done on April 15, 1994.
Chapter 3. Trade In Goods
Article 3.1. Definitions
For the purposes of this Chapter:
Agricultural goods means those goods referred to in Article 2 of WTO Agreement on Agriculture;
Consular transactions means requirements that goods of a Party intended for export to the territory of the other Party must first be submitted to the supervision of the consul of the importing Party in the territory of the exporting Party for the purpose of obtaining consular invoices or consular visas for commercial invoices, certificates of origin, manifests, shippers' export declarations or any other customs documentation required on or in connection with importation;
Duty-free means free of customs duty;
Export subsidies shall have the meaning assigned to that term in Article 1 (e) of WTO Agreement on Agriculture, including any amendment of that Article; and
Import licensing means administrative procedures requiring the submission of an application or other documentation (other than that generally required for customs clearance purposes) to the relevant administrative body as a prior condition for importation into the territory of the importing Party.
Article 3.2. Scope and Coverage
Except as otherwise provided, this Chapter applies to trade in all goods between the Parties.
Article 3.3. National Treatment
Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of GATT 1994, including its interpretative notes. To this end, Article III of GATT 1994 and its interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.
Article 3.4. Elimination of Customs Duties
1. The provisions of this Chapter concerning the elimination of customs duties on imports shall apply to goods originating in the territory of the Parties.
2. Except as otherwise provided in this Agreement, a Party shall not increase any existing customs duty or introduce a new customs duty on an originating good covered by this Agreement.
3. Except as otherwise provided in this Agreement, and subject to a Party's Schedule as set out in Annex 3.4, as at the date of entry into force of this Agreement, each Party shall eliminate all customs duties on originating goods of the other Party.
4. If a Party reduces its applied most-favoured-nation customs duties rate with respect to any product, listed in Annex 3.4, after the entry into force of this Agreement and before the end of the tariff reduction and/or elimination period, the Parties shall consult to consider adjusting the customs duties of such product to be consistent with the most-favoured-nation customs duties rate reduction.
5. On the request of either Party, the Parties shall consult to consider accelerating the elimination of customs duties set out in their Schedules in Annex 3.4. An agreement between the Parties to accelerate the elimination of a customs duty on a good shall supersede any duty rate determined pursuant to their Schedules in Annex 3.4 for such good when approved by each Party in accordance with Article 13.1.4 (b) (Free Trade Commission).
6. A Party may at any time accelerate unilaterally the elimination of customs duties on originating goods of the other Party set out in its Schedule in Annex 3.4. A Party considering doing so shall inform the other Party as early as practicable.
Article 3.5. Administrative Fees and Formalities
1. Each Party shall ensure that fees, charges, formalities and requirements imposed in connection with the importation and exportation of goods shall be consistent with its rights and obligations under GATT 1994.
2. Each Party shall not require consular transactions, including related fees and charges, in connection with the importation of any good of the other Party.
3. Each Party shall as much as possible, make available through the internet or a comparable computer-based telecommunications network, a current list of the fees and charges it imposes in connection with importation or exportation.
Article 3.6. Price Band System
Chile may maintain its price band system as established under its Law N° 18.525 or succeeding system for the products covered by that law (1), provided it is applied consistent with Chile's rights and obligations under the WTO Agreement.
Article 3.7. Agricultural Export Subsidies
1. The Parties share the objective of the multilateral elimination of all forms of export subsidies for agricultural goods and shall cooperate in an effort to achieve such an agreement and prevent their reintroduction in any form.
2. Neither Party shall introduce or maintain all forms of export subsidy on any agricultural good destined for the territory of the other Party.
Article 3.8. Non-tariff Measures
1. Each Party shall not adopt or maintain any prohibition or restriction on the importation of any good of the other Party or on the exportation or sale for export of any good destined for the territory of the other Party, except in accordance with its WTO rights and obligations or this Agreement. To this end, Article XI of GATT 1994 and its interpretative notes shall be incorporated into and shall form part of this Agreement, mutatis mutandis.
2. The Parties understand that the rights and obligations in paragraph 1 prohibit a Party from adopting or maintaining:
(a) export and import price requirements, except as permitted in enforcement of countervailing and antidumping orders and undertakings;
(b) import licensing conditioned on the fulfillment of a performance requirement; or
(c) voluntary export restraints.
3. For transparency purposes, Chile recalls that it has notified to WTO the Law 18.483 or its successor on measures concerning the importation of used vehicles.
4. Each Party shall ensure the transparency of its non-tariff measures permitted in paragraph 1 and shall ensure that any such measures are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to trade between the Parties.
Article 3.9. Committee on Trade In Goods
1. The Parties hereby establish a Committee on Trade in Goods (hereinafter referred to as "the Committee"), comprising of representatives of the Parties.
2. To facilitate communications between the Parties on any matter relating to this Chapter, each Party shall designate a contact point. Where a Party considers that any proposed or actual measure of the other Party may materially affect trade in goods between the Parties, that Party may, through the contact point, request detailed information relating to that measure.
3. The functions of the Committee shall be:
(a) reviewing and monitoring the implementation and operation of this Chapter;
(b) considering any issue related to this Chapter;
(c) receiving reports from, and reviewing the work of the Committee on Rules of Origin established pursuant to Article 4.14 (Committee on Rules of Origin);
(d) establishing any working groups, as and when necessary;
(e) carrying out other functions as may be delegated by the Commission in accordance with Chapter 13 (Administration and Institutional Provisions);
(f) identifying and recommending measures to promote and facilitate improved market access, including any acceleration of tariff commitments under Article 3.4;
(g) addressing barriers to trade in goods between the Parties, especially those related to the application of non-tariff measures, and, if appropriate, referring such matters to the Commission for its consideration; and
(h) reporting the findings and the outcome of discussions to the Commission.
4. The Committee shall meet at such venue and time as may be agreed by the Parties. Meetings may be held via teleconference, videoconference or through any other means as mutually determined by the Parties.
Chapter 4. Rules of Origin
Section 1. Determination of Origin
Article 4.1. Definitions
For the purposes of this Chapter:
Aquaculture means the farming of aquatic organisms including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants, from seedstock such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production such as regular stocking, feeding, or protection from predators;
CIF means the value of the good imported and includes the cost of insurance and freight up to the port or place of entry in the country of importation. The valuation shall be made in accordance with Article VII of GATT 1994 and the Agreement on the Implementation of Article VII of GATT 1994 as contained in Annex 1A to the WTO Agreement;
Competent authority means the authority that, according to the legislation of each Party, is responsible for the issuing of the certificate of origin and may designate the issuance of the certificate of origin into other entities or bodies. In the case of Chile, the General Directorate of International Economic Affairs, Ministry of Foreign Affairs, and in the case of Thailand, the Ministry of Commerce, or an authority succeeding this Ministry;
Exporter means a natural or juridical person located in the territory of a Party, where a good is exported from, by such a person;
FOB means the free-on-board value of the good, inclusive of the cost of transport to the port or site of final shipment abroad. The valuation shall be made in accordance with Article VII of GATT 1994 and the Agreement on the Implementation of Article VII of GATT 1994 as contained in Annex 1A to the WTO Agreement;
Fungible goods and materials means goods or materials that are interchangeable for commercial purposes and whose properties are essentially identical;
Generally Accepted Accounting Principles (GAAP) means the recognised consensus or substantial authoritative support in the territory of a Party, with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These standards may encompass broad guidelines of general application as well as detailed standards, practices and procedures;
Goods means any materials and/or products which can be wholly obtained or produced, or manufactured, even if they are intended for later use as material in another manufacturing operation;
Importer means a natural or juridical person located in the territory of a Party where a good is imported into, by such a person;
Indirect materials means a good used in the production, testing or inspection of another good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good;
Material means a good or any matter or substance such as raw materials, ingredients, parts, components, sub-components or sub-assemblies that are used or consumed in the production of goods or transformation of another good or are subject to a process in the production of another good;
Originating goods or originating material means goods or material that qualifies as originating in accordance with the provisions of this Chapter;
Packing materials and containers for shipment means goods used to protect a good during its transportation, different from those containers and packages and packing materials used for retail sale;
Product specific rules means rules that specify that the materials have undergone a change in tariff classification or a specific manufacturing or processing operation, or satisfy a Qualifying Value Content (QVC) criterion or a combination of any of these criteria; and
Production means methods of obtaining goods including, but not limited to growing, raising, mining, harvesting, fishing, farming, trapping, hunting, capturing, aquaculture, gathering, collecting, breeding, extracting, manufacturing, processing or assembling a good.
Article 4.2. Origin Criteria
Except as otherwise provided for in this Chapter, a good shall qualify as an originating good of a Party where:
(a) the good is wholly obtained or produced entirely in the Party, as defined in Article 4.3;
(b) the good is produced entirely in the Party exclusively from originating materials of the Parties; or
(c) the good satisfies the product specific rules set out in Annex 4.2, when the good is produced entirely in the Party using non-originating materials in whole or in part.
Additionally, the good shall meet all applicable requirements of this Chapter.
Article 4.3. Wholly Obtained or Produced Goods
The following goods shall be considered as wholly obtained or produced entirely in the territory of a Party:
(a) plants, plant goods and vegetable goods grown and harvested, picked or gathered in the territory of the Party;
(b) live animals born and raised in the territory of the Party;
(c) goods obtained from live animals referred to in subparagraph (b);