Article ARTICLE 8.9
Most favoured nation treatment
Each Party shall accord to investors of the other Party and to covered enterprises, as regards their establishment in its territory, treatment no less favourable than the treatment it accords, in like situations, to investors and enterprises of any third country.
Each Party shall accord to investors of the other Party and to covered enterprises, as regards their operation in its territory, treatment no less favourable than the treatment it accords, in like situations, to investors and enterprises of any third country.
Notwithstanding Paragraphs 1 and 2, a Party shall not be obliged to extend to investors of the other Party or to their covered enterprises the benefits of any treatment accorded to investors and enterprises of any third country pursuant to any international investment treaty or other trade agreement in force or signed prior to the date of entry into force of this Agreement.
Paragraphs 1 and 2 shall not be construed to oblige a Party to extend to the investors of the other Party the benefit of any treatment resulting from:
an international agreement for the avoidance of double taxation or other international agreements or arrangements relating wholly or mainly to taxation; or
measures providing for the recognition of qualifications, licences or prudential measures as provided for in Article VII of the General Agreement on Trade in Services or its Annex on Financial Services.
For greater certainty the "treatment" referred to in paragraphs 1 and 2 does not include investor-to-state dispute settlement procedures provided for in other international investment treaties and other trade agreements.
The substantive provisions in other international investment or trade agreements do not in themselves constitute "treatment" as referred to in paragraphs 1 and 2, and thus cannot give rise to a breach of this Article. However, measures applied pursuant to such provisions can constitute "treatment" as referred to in paragraphs 1 and 2, and thus give rise to a breach of this Article.
Article ARTICLE 8.10
Schedule of specific commitments
The sectors liberalised by each of the Parties pursuant to this Section and the terms, limitations, conditions and qualifications referred to in Articles 8.7 (Market Access), 8.8 (National Treatment),
8.9 (Most Favoured Nation Treatment), and 8.11 (Performance Requirements) are set out in the schedules of commitments included in Annexes […] (lists of commitments on liberalisation of investments).
Each Party shall identify in its schedules of commitments the sectors or subsectors that it commits for future liberalisation.
If a Party amends a measure relevant for a commitment in a sector or subsector referred to in paragraph 2, in a manner that reduces or eliminates the inconsistency of that measure with Articles 8.7, 8.8 or 8.11, as it existed immediately before the amendment, that Party shall not subsequently amend that measure in a manner that increases the measure’s inconsistency with Articles 8.7, 8.8 or 8.11.
Party may adopt a measure or series of measures that is consistent with the schedules of commitments included in Annexes […], provided that such measure or series of measures does not require, directly or indirectly an investor of the other Party, to sell, or otherwise dispose of, a covered investment that exists at the time the measure or series of measures becomes effective.
Article ARTICLE 8.11
Performance requirements
In the sectors set out in its schedule of specific commitments in Annexes […] (lists of commitments on liberalisation of investments of both Parties) and subject to any conditions and qualifications set out therein, a Party shall not impose, or enforce any of the following requirements, or enforce any commitment or undertaking, in connection with the establishment of all enterprises or the operation of all enterprises in its territory to11:
export a given level or percentage of goods or services;
achieve a given level or percentage of domestic content;
purchase, use or accord a preference to goods produced or services provided in its territory, or to purchase goods or services from natural persons or enterprises in its territory;
relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such enterprise;
restrict sales of goods or services in its territory that such enterprise produces or provides by relating such sales in any way to the volume or value of its exports or foreign exchange earnings;
transfer technology, a production process or other proprietary knowledge to a natural person or an enterprise in its territory;
supply exclusively from the territory of the Party a good produced or a service provided by the enterprise to a specific regional or world market;
to adopt:
a rate or amount of royalty below a certain level, or
(ii) a given duration of the term of a licence contract12,
11 For greater certainty, a condition for the receipt or continued receipt of an advantage referred to in paragraph 2 does not constitute a requirement or a commitment or undertaking for the purpose of paragraph 1.
12 A licence contract referred to in this subparagraph means any contract concerning the licencing of technology, a production process or other proprietary knowledge.
with regard to any licence contract in existence at the time the requirement is imposed or enforced, or any commitment or undertaking is enforced, or with regard to any future licence contract freely entered into between the enterprise and the natural or juridical person or any other entity in its territory, if the requirement is imposed or enforced or the commitment or undertaking is enforced, in a manner that constitutes a direct interference with that license contract by the exercise of non judicial governmental authority of a Party.13
In the sectors set out in its schedule of specific commitments in Annexes […] (lists of commitments on liberalisation of investments of both Parties) and subject to any conditions and qualifications set out therein, a Party shall not condition the receipt or continued receipt of an advantage, in connection with the establishment of all enterprises or the operation of all enterprises in its territory, on compliance with any of the following requirements:
to achieve a given level or percentage of domestic content;
to purchase, use or accord a preference to goods produced or services provided in its territory, or to purchase goods or services from natural persons or enterprises in its territory;
to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such enterprise; or
to restrict sales of goods or services in its territory that such investment produces or provides by relating such sales in any way to the volume or value of its exports or foreign exchange earnings.
Paragraph 2 shall not be construed as preventing a Party from conditioning the receipt or continued receipt of an advantage, in connection with the establishment of all enterprises or the operation of all enterprises in its territory, in compliance with a requirement to locate production, provide a service, train or employ workers, construct or expand particular facilities, or carry out research and development in its territory.
13 For greater certainty subparagraph (h) does not apply when the licence contract is concluded between the enterprise and the Party.
Subparagraphs 1 (f) and (h) do not apply when the requirement is imposed or the commitment or undertaking is enforced by a court, administrative tribunal or competition authority to remedy a restriction of competition or if a Party authorises use of an intellectual property right in accordance with Article 31 [and 31 bis] of the TRIPS Agreement, or to measures requiring the disclosure of proprietary information that fall within the scope of, and are consistent with, Article 39 of the TRIPS Agreement.
The provisions of:
Subparagraphs 1 (a), (b) and (c), and 2 (a) and (b) do not apply to qualification requirements for goods or services with respect to participation in export promotion and foreign aid programmes; and
this Article does not apply to procurement by a procuring entity for goods and services purchased for governmental purposes and not with a view to commercial resale or with a view to use in the supply of goods and services for commercial sale.
For greater certainty, subparagraphs 2 (a) and (b) do not apply to requirements imposed by an importing Party relating to the content of goods necessary to qualify for preferential tariffs or preferential quotas.
Subparagraph 1 (h) does not apply if the requirement is imposed or enforced, or the commitment or undertaking is enforced, by a Tribunal as equitable remuneration under the Party’s copyright laws.
This Article is without prejudice to the obligations of a Party under the WTO Agreement.
For greater certainty, paragraphs 1 and 2 of this Article shall not apply to any commitment, undertaking or requirement other than those set out in those paragraphs.14
14 For greater certainty, this Article shall not be construed as requiring a Party to permit a particular service to be supplied on a cross-border basis where that Party adopts or maintains restrictions or prohibitions on such provision of services which are consistent with its schedules of commitments referred to in Article 2.5 Schedule of Specific Commitments.
This Article does not preclude enforcement of any commitment, undertaking or requirement between private parties other than a Party, if a Party did not impose or require the commitment, undertaking or requirement.
SECTION C
CROSS-BORDER SUPPLY OF SERVICES
Article ARTICLE 8.12
Scope and definitions
This Section applies to measures of the Parties affecting the cross-border supply of all services sectors with the exception of:
audio-visual services;
national maritime cabotage15; and
domestic and international air transport services, whether scheduled or non-scheduled, and services directly related to the exercise of traffic rights, other than:
aircraft repair and maintenance services during which an aircraft is withdrawn from service;
15 Without prejudice to the scope of activities which may be considered as cabotage under the relevant national legislation, national maritime cabotage under this Section covers transportation of passengers or goods between a port or point located in Indonesia or in a Member State of the European Union and another port or point located also in Indonesia including its continental shelf, archipelagic waters and EEZ or also in that same Member State of the European Union, including on its continental shelf, as provided in the UN Convention on the Law of the Sea, and traffic originating and terminating in the same port or point located in Indonesia or in a Member State of the European Union.
the selling and marketing of air transport services;
computer reservation system (CRS) services; and
groundhandling services.
Article ARTICLE 8.13
Market access
With respect to market access through the cross-border supply of services, each Party shall accord services and service suppliers of the other Party treatment not less favourable than that provided for under the terms, limitations and conditions agreed and specified in its Schedule of specific commitments.
In sectors where market access commitments are undertaken, the measures which a Party shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire territory, unless otherwise specified in the Schedule of Specific Commitments in Annexes […] (lists of commitments on cross border supply of services), are defined as:
limitations on the number of services suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test16;
limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test; and
limitations on the total number of service operations or on the total quantity of service output expressed in the terms of designated numerical units in the form of quotas or the requirement of an economic needs test.
16 Subparagraph 2(a) includes measures which require a service supplier of the other Party to have an enterprise within the meaning of paragraph (d) of Article 1.3 (Definitions) or to be resident in a Party’s territory as a condition for the cross-border supply of a service.
Article ARTICLE 8.14
National treatment
In the sectors inscribed in its Schedule of Specific Commitments in Annexes […] (lists of commitments on cross border supply of services) and subject to any conditions and qualifications set out therein, each Party shall accord to services and service suppliers of the other Party, in respect of all measures affecting the cross-border supply of services, treatment no less favourable than that it accords to its own like services and services suppliers.
A Party may meet the requirement of paragraph 1 of this Article by according to services and service suppliers of the other Party either formally identical treatment or formally different treatment to that it accords to its own like services and service suppliers.
Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of competition in favour of services or service suppliers of the Party compared to like services or service suppliers of the other Party.
Specific commitments assumed under this Article shall not be construed to require any Party to compensate for inherent competitive disadvantages which result from the foreign character of the relevant services or services suppliers.
Article ARTICLE 8.15
Most favoured nation treatment
Each Party shall accord to services and service suppliers of the other Party treatment no less favourable than that which it accords, in like situations, to services and service suppliers of any third country.
Notwithstanding Paragraph 1, a Party shall not be obliged to extend to services and service suppliers of the other Party the benefits of any treatment accorded to services and service suppliers
of any third country pursuant to any international investment treaty or other trade agreement signed or in force prior to the date of entry into force of this Agreement.
Paragraphs 1 and 2 shall not be construed to oblige a Party to extend to the investors of the other Party the benefit of any treatment resulting from:
an international agreement for the avoidance of double taxation or other international agreements or arrangements relating wholly or mainly to taxation; or
measures providing for the recognition of qualifications, licences or prudential measures as provided for in Article VII of the General Agreement on Trade in Services or its Annex on Financial Services.
The substantive provisions in other international investment or trade agreements do not in themselves constitute "treatment" as referred to in paragraphs 1 and 2, and thus cannot give rise to a breach of this Article. However, measures applied pursuant to such provisions can constitute "treatment" as referred to in paragraphs 1 and 2, and thus give rise to a breach of this Article.
Article ARTICLE 8.16
Schedule of specific commitments
The sectors liberalised by each of the Parties pursuant to this Section and the terms, limitations, conditions and qualifications referred to in Articles 8.13 (Market Access), 8.14 (National Treatment), and Article 8.15 (Most Favoured Nation Treatment) are set out in the schedules of commitments included in Annexes (…) [lists of commitments on cross-border supply of services [and list of MFN exemptions]].
SECTION D
TEMPORARY PRESENCE OF NATURAL PERSONS FOR BUSINESS PURPOSES
Article ARTICLE 8.17
Scope and definitions
This Section applies to measures of the Parties concerning the entry and temporary stay in their territories of natural persons for business purposes of the other party as provided in paragraph 2 of this Article, subject to each Party’s reservation as specified in Annex(es) (...) in accordance with paragraph 2 of Article 8.3 (Coverage).
For the purpose of this Section:
"business visitors for establishment purposes" mean natural persons working in a senior position within a juridical person of a Party who are responsible for setting up an enterprise of such juridical person in the territory of the other Party. They do not offer or provide services or engage in any other economic activity than required for establishment purposes. They do not receive remuneration from a source located within the territory of that other Party;
"intra-corporate transferees"17 mean natural persons who have been employed by a juridical person of a party or its branch or have been partners in it for at least one year and who are temporarily transferred to an enterprise of the juridical person in the territory of the other Party. The natural person concerned must belong to one of the following categories:
directors/managers/executives18: Persons working in a senior position within a juridical person of a Party, who primarily direct the management of the enterprise in the territory of the other Party, receiving general supervision or direction principally from the board of directors or from stockholders of the business or their equivalent, including at least:
directing the enterprise or a department or subdivision thereof;
supervising and controlling the work of other supervisory, professional or managerial employees; and
17 For greater certainty, managers, executives and specialists may be required to demonstrate they possess the professional qualification and length of working experience needed in the juridical person to which they are transferred 18 For greater certainty, in Indonesia, managers and executives are not allowed to receive direction directly from stockholders.
having the personal authority to recruit and dismiss or to recommend recruitment, dismissal or other personnel-related actions;
specialists: persons working within a juridical person possessing specialised knowledge essential to the enterprise’s areas of activity, techniques or management. In assessing such knowledge, account shall be taken not only of knowledge specific to the enterprise, but also of whether the person has a high level of qualification, including adequate professional experience, referring to a type of work or activity requiring specific technical knowledge, including possible membership of an accredited profession;
trainee employees: Persons who have been employed by a juridical person or its branch for at least one year, and, possess a university degree and are temporarily transferred to obtain training in business techniques or methods19 for career development purposes;
"short term business visitors" means natural persons of a Party who are seeking entry and temporary stay in the territory of the other Party, and who are allowed to engage in:
meetings and consultations, as natural persons attending meetings or conferences, giving lectures or engaged in consultations with business associates;
sales, as representatives of a supplier of services or goods taking orders or negotiating the sale of services or goods or entering into agreements to sell services or goods for that supplier, but not delivering goods or supplying services themselves. They are not commission agents and shall not engage in making direct sales to the general public;
"installers and maintainers" means natural persons of a Party who are seeking entry and temporary stay in the territory of the other Party, possessing specialised knowledge essential to a contractual obligation of a seller or a lessor of a Party, supplying relevant services which may include training workers to perform relevant services, pursuant to a warranty or other service contract incidental to the sale or lease of commercial or industrial equipment or machinery, including computer software, purchased or leased from an enterprise of the Party of which the
19 The recipient enterprise may be required to submit a training programme covering the duration of the stay for prior approval, demonstrating that the purpose of the stay is for training. For AT, CZ, DE, FR, ES and HU, training must be linked to the university degree which has been obtained.
installers and maintainers are natural persons, within the duration of the warranty or service contract;
"contractual services suppliers" mean natural persons employed by a juridical person of a Party which itself is not an agency for placement and supply services of personnel nor acting through such an agency, which has not established in the territory of the other Party and which has concluded a bona fide contract to supply services with a final consumer in the other Party, requiring the presence on a temporary basis of its employees in that Party, in order to fulfil the contract to provide services20;
"independent professionals" mean natural persons engaged in the supply of a service and established as self-employed in the territory of a Party who have not established in the territory of the other Party and who have concluded a bona fide contract (other than through an agency for placement and supply services of personnel) to supply services with a final consumer in the latter Party, requiring their presence on a temporary basis in that Party in order to fulfil the contract to provide services21; and
"qualifications" mean diplomas, certificates and other evidence (of formal qualification) issued by an authority designated pursuant to legislative, regulatory or administrative provisions and certifying successful completion of professional training.
Article ARTICLE 8.18
Intra-corporate transferees and business visitors for establishment purposes
For every sector committed in accordance with Article 8.10 and subject to the relevant conditions and qualifications specified in Annex [reservations for ICTs and BVEPs]22,
20 The service contract referred to under (d) and (e) shall comply with the requirements of the laws, and regulations and requirements of the Party where the contract is executed.
21 The service contract referred to under (d) and (e) shall comply with the requirements of the laws, and regulations and requirements of the Party where the contract is executed.
22 For greater certainty, if a Party set out a reservation in Annex [cross-border] or Annex [investment liberalisation], the reservation also constitutes a reservation to this article to the extent that the measure set out in or permitted by the reservation affects the treatment of a natural person for business purposes entering and temporary staying in the territory of the other Party.
each Party shall allow:
the entry and temporary stay of business visitors for establishment purposes and Intra-
Corporate Transferees as defined in Article 8.17 (Scope and Definitions), and
the employment in its territory of Intra-Corporate Transferees of the other Party;
a Party shall not maintain or adopt limitations in the form of numerical quotas or economic needs tests on the total number of natural persons that, in a specific sector, are granted entry as business visitors for establishment purposes or that an investor may employ as intra-corporate transferees, either on the basis of a territorial subdivision or on the basis of its entire territory.
each Party shall accord to Intra-corporate Transferees and Business Visitors for Establishment Purposes of the other Party, with regard to their temporary stay in its territory, treatment no less favourable than that it accords, in like situations, to its own natural persons.
The entry and temporary stay shall be for a period of up to three years for directors/managers/executives and specialists, one year for trainee employees and, for Indonesia, sixty days, extendable to 120, and for the European Union, ninety days, in any 12-month period for business visitors for establishment purposes.
Article ARTICLE 8.19
Short term business visitors, and installers and maintainers
For every sector committed in accordance with this Agreement subject to the relevant conditions and qualifications specified in Annex IV [reservations for ICTs, BVEP, Short term Business Visitors and I&M], a Party shall grant entry and temporary stay to Short term Business Visitors and Installers and Maintainers of the other Party, subject to the following conditions and relevant qualifications:
the Short term Business Visitors and Installers and Maintainers are not engaged in selling their goods or supplying services to the general public; and
the Short term Business Visitors and Installers and Maintainers do not, on their own behalf, receive remuneration from within the Party where they are staying temporarily;
Unless otherwise specified in Annex IV [reservations for ICTs, BVEP, BS and I&M], a Party shall grant entry of Short term Business Visitors and Installers and Maintainers without the requirement of a work permit, economic needs test or other prior approval procedures of similar intent.
The permissible length of stay shall be for a period of up to ninety days in any twelve-month period.
Article ARTICLE 8.20
Contractual service suppliers
The Parties reaffirm their respective obligations arising from their commitments under the General Agreement on Trade in Services with respect to the entry and temporary stay of contractual services suppliers.
For every sector listed below, each Party shall allow the supply of services into their territory by contractual services suppliers of the other Party, subject to the conditions specified in paragraph 3 and any reservations listed in Annex (…) [reservations on contractual services sellers.
The commitments undertaken by the Parties are subject to the following conditions:
the natural persons must be engaged in the supply of a service on a temporary basis as employees of a juridical person, which has obtained a service contract not exceeding twelve months;
the natural persons entering the other Party must possess, at the date of submission of an application for entry into the other Party, at least five years professional experience23 in the sector of activity which is the subject of the contract. Natural persons should be offering such
23 Obtained after having reached the age of majority