Each panellist shall:
have demonstrated expertise in law, international trade, and other matters covered by this Agreement;
be independent of, and not be affiliated with3 or take instructions from, either Party;
3 For greater certainty, the fact that a person receives an income from the government of a Party, was formerly employed by the government of a Party, or has a family relationship with a government official of a Party, is not in itself a reason to be considered as being affiliated with that government.
serve in their individual capacities and not take instructions from any organisation or government with regard to matters related to the dispute; and
comply with Annex 22[A- (Code of Conduct for Panellists and Mediators]
The chairperson shall also have experience in dispute settlement procedures.
By way of derogation from point (a) of paragraph 1, and paragraph 2, each panellist on the TSGD list shall have specialised knowledge of, or expertise in, labour or environmental law, issues addressed in Chapter 15 (Trade and Sustainable Growth and Development)], or the resolution of disputes arising under international agreements.
In view of the subject-matter of a particular dispute, the Parties may agree to derogate from the requirements listed in point (a) of paragraph 1.
Article Article 22.9
The panel:
shall make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the covered provisions;
shall set out, in its decisions and reports, the findings of facts, the applicability of the covered provisions and the basic rationale behind any findings and conclusions that it makes; and
should consult regularly with the Parties and provide adequate opportunities for the development of a mutually agreed solution.
Article Article 22.10
Unless the Parties agree otherwise within five days after the date of establishment of the panel, the terms of reference of the panel shall be:
“to examine, in the light of the relevant provisions of this Agreement cited by the Parties, the matter referred to in the request for the establishment of the panel, to make findings on the conformity of the measure at issue with the provisions of this Agreement
referred to in Article 22.2 (Scope) and to deliver a report in accordance with Articles
22.12 (Interim Report) and 22.13 (Final Report).”
If the Parties agree on other terms of reference, they shall notify the agreed terms of reference to the panel within the time period set out in paragraph 1.
Article Article 22.11
If a Party so requests, the panel shall decide, within ten days of its establishment, whether the case concerns matters of urgency.
In the Panel decides that the dispute concerns matters of urgency, it shall, after consulting the Parties, shorten the applicable time periods set out in Section C (Panel Procedures) in this Chapter, except for the time periods referred to in Article 22.6 (Establishment of a Panel) and Article 22.10 (Terms of Reference).
Article Article 22.12
The panel shall deliver an interim report to the Parties, to the extent practicable within 90 days after the date of establishment of the panel. When the panel considers that this deadline cannot be met, the chairperson of the panel shall notify the Parties in writing, including electronically, stating the reasons for the delay and the date on which the panel plans to deliver its interim report. The panel should, under no circumstances, deliver its interim report later than 120 days after the date of establishment of the panel. If the complaining Party chooses to deliver a second written submission pursuant to Rule [11] of Annex 22-A (Rules of Procedure), the time periods set out in this paragraph shall be extended by 30 days.
Each Party may deliver to the panel a written request, including electronically, to review precise aspects of the interim report within ten days of its receipt. A Party may comment on the other Party’s request within six days of the delivery of the request.
Article Article 22.13
The panel shall deliver its final report to the Parties, to the extent practicable within 120 days of the date of establishment of the panel. When the panel considers that this deadline cannot be met, the chairperson of the panel shall notify the Parties in writing,
including electronically, stating the reasons for the delay and the date on which the panel plans to deliver its final report. The panel should, under no circumstances, deliver its final report later than 150 days after the date of establishment of the panel. If the complaining Party chooses to deliver a second written submission pursuant to Rule [11] of Annex 22-A (Rules of Procedure), the time periods set out in this paragraph shall be extended by 30 days.
The final report shall include a discussion of any request in writing, including electronically, by the Parties on the interim report and clearly address the comments of the Parties.
Article Article 22.14
The Party complained against shall take any measure necessary to comply promptly with the findings and conclusions in the final report in order to bring itself in compliance with the covered provisions.
The Party complained against shall, no later than 30 days after receipt of the final report, deliver a notification to the complaining Party of the measures which it has taken or which it envisages to take to comply.
In addition, if the dispute concerns Chapter 15 (Trade and Sustainable Growth and Development)]:
the Party complained against shall, no later than 30 days after the date of delivery of the final report, inform its civil society bodies set up pursuant to Articles [24.2(3) and 24.7] of Chapter 24 (Institutional Provisions)] of the compliance measures it has taken or envisages to take; and
the Speacialised Committee on Trade and Sustainable Growth set up pursuant to Article 24.4 (Specialised Committees) of Chapter 24 (Institutional Provisions) shall monitor in its trade and sustainable growth and development configuration the implementation of the compliance measures. The civil society bodies set up pursuant to Articles 24.2(3) and 24.7 of Chapter 24 (Institutional Provisions) may submit observations to the Specialised Committee on Trade Sustainable Growth in its trade and sustainable growth and development configuration in this regard.
Article Article 22.15
If immediate compliance is not possible, the Party complained against shall, no later than 30 days after receipt of the final report, deliver a notification to the complaining
Party of the length of the reasonable period of time it will require for compliance. The Parties shall endeavour to agree on the length of the reasonable period of time to comply with the final report.
If the Parties have not agreed on the length of the reasonable period of time, the complaining Party may, at the earliest 20 days after the receipt of the notification in paragraph 1, request in writing, including electronically, the original panel to determine the length of the reasonable period of time. The panel shall deliver its decision to the Parties within 30 days of the date of receipt of the request.
The Party complained against shall deliver a written notification, including electronically, of its progress in complying with the final report to the complaining Party at least one month before the expiry of the reasonable period of time.
The Parties may agree to extend the reasonable period of time.
Article Article 22.16
The Party complained against shall, no later than at the date of expiry of the reasonable period of time, deliver a notification to the complaining Party of any measure that it has taken to comply with the final report.
When the Parties disagree on the existence or the consistency with the covered provisions of any measure taken to comply, the complaining Party may deliver a request in writing, including electronically, to the original panel to decide on the matter. The request shall identify any measure at issue and explain how that measure constitutes a breach of the covered provisions in a manner sufficient to present the legal basis for the complaint clearly. The panel shall deliver its decision to the Parties within 46 days of the date of receipt of the request.
Article Article 22.17
The Party complained against shall, upon request by and after consultations with the complaining Party, present an offer for temporary compensation if:
the Party complained against delivers a notification to the complaining Party that it is not possible to comply with the final report; or
the Party complained against fails to deliver a notification of any measure taken to comply within the deadline referred to in Article 22.14 (Compliance Measures) or before the date of expiry of the reasonable period of time; or
the panel finds that no measure taken to comply exists; or
the panel finds the measure taken to comply is inconsistent with the covered provisions.
If the dispute concerns Chapter 15 (Trade and Sustainable Growth and Development)], this Article applies if:
any of the circumstances set out in points (a), (b) or (c) of paragraph 1 arise and the final report pursuant to Article 22.13 (Final Report) found a violation of the obligation referred to in Article 15.4(4) (Trade and Labour) of Chapter 15 (Trade and Sustainable Growth and Development]) or of the obligation referred to in Article 15.7(3) (Trade and Climate Change) of Chapter 15 (Trade and Sustainable Growth and Development); or
the circumstances set out in point (d) of paragraph 1 arise and the decision of the compliance panel pursuant to Article 22.16 (Compliance Review) found a violation of the obligation referred to in Article 15.4(4) (Trade and Labour) of Chapter 15 (Trade and Sustainable Growth and Development) or of the obligation referred to in Article 15.7(3) (Trade and Climate Change) of Chapter 15 (Trade and Sustainable Growth and Development)].
In any of the situations referred to in points (a) to (d) of paragraph 1 and points (a) and
(b) of paragraph 2, the complaining Party may deliver a written notification, including electronically, to the Party complained against that it intends to suspend the application of obligations under the covered provisions if:
the complaining Party decides not to make a request under paragraphs 1 or 2; or
the Parties do not agree on the temporary compensation within 30 days after the expiry of the reasonable period of time or the delivery of the panel decision under Article 22.16 (Compliance Review) when a request under paragraph 1 is made.
The notification shall specify the level of intended suspension of obligations.
The complaining Party may suspend the obligations 20 days at the earliest after the date of delivery of the notification referred to in paragraph 3, unless the Party complained against made a request under paragraph 6.
The suspension of obligations shall not exceed the level equivalent to the nullification or impairment caused by the violation.
If the Party complained against considers that the notified level of suspension of obligations exceeds the level equivalent to the nullification or impairment caused by the violation, it may deliver a written request, including electronically, to the original panel before the expiry of the 20 day period set out in paragraph 4 to decide on the matter. The panel shall deliver its decision on the level of the suspension of obligations to the Parties within 30 days of the date of the request. Obligations shall not be suspended until the panel has delivered its decision. The suspension of obligations shall be consistent with this decision.
The suspension of obligations or the compensation referred to in this Article shall be temporary and shall not be applied after:
the Parties have reached a mutually agreed solution pursuant to Article 22.33 (Mutually Agreed Solution);
the Parties have agreed that the measure taken to comply brings the Party complained against into conformity with the covered provisions; or
any measure taken to comply which the panel has found to be inconsistent with the covered provisions has been withdrawn or amended so as to bring the Party complained against into conformity with those provisions.
Article Article 22.18
The Party complained against shall deliver a notification to the complaining Party of any measure it has taken to comply following the suspension of obligations or following the application of temporary compensation, as the case may be. With the exception of cases under paragraph 2, the complaining Party shall terminate the suspension of obligations within 30 days from the receipt of the notification. In cases where compensation has been applied, and with the exception of cases under paragraph 2, the Party complained against may terminate the application of such compensation within 30 days from receipt of its notification that it has complied.
If the Parties do not reach an agreement on whether the notified measure brings the Party complained against into conformity with the covered provisions within thirty days of the date of receipt of the notification, the complaining Party shall deliver a written request, including electronically, to the original panel to decide on the matter. The panel shall deliver its decision to the Parties within 46 days of the date of the receipt of the request. If the panel finds that the measure taken to comply is in conformity with the covered provisions, the suspension of obligations or compensation, as the case may be, shall be terminated. When relevant, the complaining Party shall adjust the level of suspension of obligations or of compensation in light of the panel decision.
If the Party complained against considers that the level of suspension implemented by the complaining Party exceeds the level equivalent to the nullification or impairment caused by the violation, it may deliver a written request, including electronically, to the original panel to decide on the matter.
Article Article 22.19
If during dispute settlement procedures, a panellist is unable to participate, withdraws or needs to be replaced because he or she does not comply with the requirements of Annex 22[A (Code of Conduct for Panellists and Mediators)], the procedure provided for in Article 22.6 (Establishment of a Panel) applies. The time period for the delivery of the report or decision shall be extended for the time necessary for the appointment of the new panellist.
Article Article 22.20
Panel procedures shall be governed by this Chapter and Annex 22-A (Rules of Procedure)]. The hearings of the arbitration panel shall be closed for any discussion of confidential information. Otherwise, the hearing shall be open to the public, unless the Parties to the dispute agree otherwise.
Article Article 22.21
At the request of both Parties or the complaining Party, the panel shall suspend its work at any time for a period agreed by the Parties and not exceeding 12 consecutive months. The panel shall resume its work before the end of the suspension period at the written request, including electronically, of both Parties or the complaining Party, or at the end of the suspension period at the written request, including electronically, of either Party. The requesting Party shall deliver a notification to the other Party accordingly. If a Party does not request the resumption of the panel’s work at the expiry of the suspension period, the authority of the panel shall lapse and the dispute settlement procedure shall be terminated. In the event of a suspension of the work of the panel, the relevant time periods under this Section shall be extended by the same period of time for which the work of the panel was suspended.
Article Article 22.22
At the request of a Party, or upon its own initiative, the panel may seek, from the Parties, relevant information it considers necessary and appropriate. The Parties shall respond promptly and fully to any request by the panel for such information.
Upon the request of a Party or its own initiative, the panel may seek any information it deems appropriate from any source. The panel also has the right to seek the opinion of experts, as it deems appropriate, and subject to any terms and conditions agreed by the Parties, where applicable.
If the dispute concerns provisions of Chapter 15 (Trade and Sustainable Growth and Development) which relate to compliance with multilateral agreements and instruments referred to in Chapter 15 (Trade and Sustainable Growth and Development), any
information or expert opinion requested by the panel should include information and advice from the ILO or from relevant bodies or organisations established under MEAs.
The panel shall consider amicus curiae submissions from natural persons of a Party or legal persons established in a Party in accordance with Annex 22-A (Rules of Procedure).
Any information obtained by the panel under this Article shall be disclosed to the Parties and the Parties may provide comments on that information.
Article Article 22.23
The panel shall interpret the covered provisions in accordance with customary rules of interpretation of public international law, including those codified in the 1969 Vienna Convention on the Law of Treaties. The panel shall also take into account relevant interpretations in reports of WTO panels and the Appellate Body adopted by the Dispute Settlement Body of the WTO.
Article Article 22.24
The deliberations of the panel shall be kept confidential. The panel shall make every effort to draft reports and take decisions by consensus. If this is not possible, the panel shall decide the matter by majority vote. In no case shall separate opinions of arbitrators be disclosed.
The decisions and reports of the panel shall be accepted unconditionally by the Parties.
Reports and decisions of the panel cannot add to or diminish the rights and obligations of the Parties under this Agreement. They shall not create any rights or obligations with respect to natural or legal persons.
The panel and the Parties shall treat as confidential any information submitted by a Party to the panel in accordance with Annex 22-A (Rules of Procedure)].
Article Article 22.25
When a dispute arises regarding a particular measure in alleged breach of an obligation under this Agreement and a substantially equivalent obligation under another international agreement to which both Parties are party, including the WTO Agreement, the Party seeking redress shall select the forum in which to settle the dispute.
Once a Party has selected the forum and initiated dispute settlement procedures under this Section or under another international agreement, the Party shall not initiate dispute settlement procedures under the other agreement with respect to the particular measure referred to in paragraph 1, unless the forum selected first fails to make findings for procedural or jurisdictional reasons.
For the purposes of this Article:
dispute settlement procedures under this Section are deemed to be initiated by a Party’s request for the establishment of a panel under Article X.5 (Initiation of Panel Procedures);
dispute settlement procedures under the WTO Agreement are deemed to be initiated by a Party’s request for the establishment of a panel under Article 6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes of the WTO; and
dispute settlement procedures under any other agreement are deemed to be initiated in accordance with the relevant provisions of that agreement.
Without prejudice to paragraph 2, nothing in this Agreement shall preclude a Party from suspending obligations authorised by the Dispute Settlement Body of the WTO or authorised under the dispute settlement procedures of another international agreement to which the disputing Parties are party. The WTO Agreement or the other international agreement between the Parties shall not be invoked to preclude a Party from suspending obligations under this Section.
MEDIATION MECHANISM
Article Article 22.26
The objective of the mediation mechanism is to facilitate the finding of a mutually agreed solution through a comprehensive and expeditious procedure with the assistance of a mediator.
Article Article 22.27
At any time before the initiation of the mediation procedure, a Party may deliver a written request, including electronically, for information regarding a measure adversely affecting trade or investment between the Parties. The Party to which such request is made shall, within twenty-one days of receipt of the request, deliver a written response, including electronically, containing its comments on the requested information.
When the responding Party considers it will not be able to deliver a response within twenty days of receipt of the request, it shall promptly notify the requesting Party, stating the reasons for the delay and providing an estimate of the shortest period within which it will be able to deliver its response.
A Party is normally expected to avail itself of this provision before the initiation of the mediation procedure.
Article Article 22.28
A Party may at any time request to enter into a mediation procedure with respect to any measure by a Party adversely affecting trade or investment between the Parties.
The request shall be made by means of a written request, including electronically, delivered to the other Party. The request shall be sufficiently detailed to present the concerns of the requesting Party clearly and shall:
identify the specific measure at issue;
provide a statement of the adverse effects that the requesting Party considers the measure has, or will have, on trade or investment between the Parties; and
explain how the requesting Party considers that those effects are linked to the measure.
The mediation procedure may only be initiated by mutual agreement of the Parties in order to explore mutually agreed solutions and consider any advice and proposed solutions by the mediator. The Party to which the request is made shall give sympathetic consideration to the request and deliver its written acceptance or rejection, including electronically, to the requesting Party within ten days of its receipt. Otherwise the request shall be regarded as rejected.
Article Article 22.29
The Parties shall endeavour to agree on a mediator within ten days of the initiation of the mediation procedure.
In the event that the Parties are unable to agree on the mediator within the time period laid down in paragraph 1, either Party may request the co-chair of the Trade Committee from the complaining Party to select the mediator by lot, within five days from the request, from the sub-list of chairpersons established under Article 22.7 (Lists of Panellists). The co-chair of the Trade Committee from the complaining Party may delegate such selection by lot of the mediator.
Should the sub-list of chairpersons referred to in Article 22.7 (Lists of Panellists) not be established at the time a request is made pursuant to Article 22.28 (Initiation of the Mediation Procedure), the mediator shall be drawn by lot from the individuals formally proposed by one or both of the Parties for that sub-list.
A mediator shall not be a national of either Party or employed by either Party, unless the Parties agree otherwise.
A mediators shall comply with Annex 22-A (Code of Conduct for Panellists and Mediators).
Article Article 22.30
Within ten days of the appointment of the mediator, the Party which invoked the mediation procedure shall deliver to the mediator and to the other Party a detailed written description of its concerns, in particular of the operation of the measure at issue and its possible adverse effects on trade or investment. Within twenty days of the receipt of this description, the other Party may deliver written comments on this description. Either Party may include any information that it deems relevant in its description or comments.
The mediator shall assist the Parties in a transparent manner in bringing clarity to the measure concerned and its possible adverse effects on trade or investment. In particular, the mediator may organise meetings between the Parties, consult the Parties jointly or individually, seek the assistance of, or consult with, relevant experts and stakeholders and provide any additional support requested by the Parties. The mediator shall consult with the Parties before seeking the assistance of, or consulting with, relevant experts and stakeholders.
The mediator may offer advice and propose a solution for the consideration of the Parties. The Parties may accept or reject the proposed solution, or agree on a different solution. The mediator shall not advise or comment on the consistency of the measure at issue with this Agreement.
The mediation procedure shall take place in the territory of the Party to which the request was addressed, or by mutual agreement in any other location or by any other means.
The Parties shall endeavour to reach a mutually agreed solution within sixty days of the appointment of the mediator. Pending a final agreement, the Parties may consider possible interim solutions, particularly if the measure relates to perishable goods or seasonal goods or services.
The mutually agreed solution may be adopted by means of a decision of the Trade Committee. Either Party may make the solution subject to the completion of any necessary internal procedures.
Upon request of either Party, the mediator shall deliver a draft factual report to the Parties, providing:
a brief summary of the measure at issue;
the procedures followed; and
if applicable, any mutually agreed solution reached, including possible interim solutions.
The mediator shall allow the Parties fifteen days to comment on the draft report. After considering the comments of the Parties received, the mediator shall, within fifteen days, deliver a final factual report to the Parties. The factual report shall not include any interpretation of this Agreement.
The procedure shall be terminated:
by the adoption of a mutually agreed solution by the Parties, on the date of the adoption thereof;
by mutual agreement of the Parties at any stage of the procedure, on the date of that agreement;
by a written declaration of the mediator, after consultation with the Parties, that further efforts at mediation would be to no avail, on the date of that declaration; or
by a written declaration of a Party after exploring mutually agreed solutions under the mediation procedure and after having considered any advice and proposed solutions by the mediator, on the date of that declaration.
Article Article 22.31
Unless the Parties agree otherwise, all steps of the mediation procedure, including any advice or proposed solution, are confidential. Any Party may disclose to the public the fact that mediation is taking place.
Article Article 22.32
The mediation procedure is without prejudice to the Parties’ rights and obligations under Sections B (Consultations) and C (Panel Procedures) or under dispute settlement procedures under any other agreement.
A Party shall not rely on, or introduce as evidence, in other dispute settlement procedures under this Agreement or any other agreement, nor shall a panel take into consideration:
positions taken by the other Party in the course of the mediation procedure or information exclusively gathered under paragraph 2 of Article 22.30 (Rules of the Mediation Procedure);
the fact that the other Party has indicated its willingness to accept a solution to the measure subject to mediation; or
advice given or proposals made by the mediator.
Unless the Parties agree otherwise, a mediator shall not serve as a member of a panel in dispute settlement procedures under this Agreement or under any other agreement involving the same matter for which he or she has been a mediator.
COMMON PROVISIONS
Article Article 22.33
The Parties may reach a mutually agreed solution at any time with respect to any dispute referred to in Article 22.2 (Scope).
If a mutually agreed solution is reached during the panel or mediation procedure, the Parties shall jointly notify that solution to the chairperson of the panel or the mediator, respectively. Upon such notification, the panel or the mediation procedure shall be terminated.