Title
CANADA - INDONESIA COMPREHENSIVE ECONOMIC PARTNERSHIP AGREEMENT
Preamble
PREAMBLE
CANADA AND THE REPUBLIC OF INDONESIA, collectively referred to as “the Parties”, resolving to:
STRENGTHEN the bonds of friendship and cooperation between them and their peoples;
BUILD on their respective rights and obligations under the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994, and other multilateral and bilateral instruments of cooperation;
FACILITATE trade in goods and services between the Parties by enhancing transparency, and promoting good regulatory practices;
RECOGNISE that the provisions of this Agreement preserve the right of the Parties to regulate within their territories to achieve legitimate public policy objectives;
PROTECT human, animal, orplant life orhealth in the territories of the Parties and advance science-based decision making while facilitating trade between them;
PROMOTE transparency, good governance and the rule of law, and prevent and combat bribery and corruption in trade and investment;
ENHANCE conditions of fair competition in the territory of the Parties;
ENCOURAGE enterprises operating within their territory or subject to their jurisdiction to respect internationally recognised responsible business conduct principles and standards;
PROMOTE, PROTECT and ENFORCE labour rights, the improvement of working conditions, and the strengthening of cooperation on labour issues;
PROMOTE high levels of environmental protection, including through effective enforcement of environmental laws and environmental cooperation;
ADVANCE the objective of sustainable development in its economic, social and environmental dimensions through enhanced bilateral relations;
SUPPORT the growth and development of small and medium-sized enterprises by enhancing their ability to fully participate in and benefit from the opportunities created by this Agreement;
RECOGNISE that small and medium-sized enterprises, including micro enterprises and entrepreneurs contribute significantly to economic prosperity, employment, community development, youth engagement and innovation, as well as making progress in achieving the UN Sustainable Development Goals;
REAFFIRM their commitments as parties to the UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, done at Paris on 20 October 2005, and recognise that states must maintain the ability to preserve, develop, and implement their cultural policies;
ESTABLISH a predictable legal and commercial framework that supports increased trade and investment through their Comprehensive Economic Partnership;
HAVE AGREED as follows:
Body
Chapter 1. INITIAL PROVISIONS AND GENERAL DEFINITIONS
Section A. Initial Provisions
Article 1.1. Establishment of a Free Trade Area
The Parties, consistent with Article XXIV of GATT 1994 and Article V of GATS, hereby establish the Canada-Indonesia Comprehensive Economic Partnership as a free trade area.
Article 1.2. Relation to other Agreements
1. The Parties affirm their existing rights and obligations with respect to each other under the WTO Agreement and other agreements to which the Parties are party.
2. If a Party considers that a provision of this Agreement is inconsistent with a provision of another agreement referred to in paragraph 1, the Parties shall, on request, consult with each other to reach a mutually satisfactory outcome. This paragraph is without prejudice to a Party’s rights and obligations under Chapter 24 (Dispute Settlement).
Article 1.3. Extent of Obligations
Except as otherwise provided in this Agreement, each Party is fully responsible for the observance of all provisions of this Agreement and shall take reasonable measures as may be available to it to ensure observance of the provisions of this Agreement by governments other than at the central level and authorities within its territory.
Article 1.4. Delegated Authority
Each Party shall ensure that any person that has been delegated regulatory, administrative, or other governmental authority by a Party act in accordance with the Party’s obligations as set out under this Agreement in the exercise of that authority.
Section B. General Definitions
Article 1.5. General Definitions
For the purposes of this Agreement, unless otherwise specified:
AD Agreement means the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement;
central government means:
(a) for Canada, the Government of Canada;
(b) for Indonesia, the Government of the Republic of Indonesia;
covered investment means, with respect to a Party, an investment:
(a) in its territory;
(b) made in accordance with the applicable domestic law of the Party at the time the investment is made; (1)
(c) directly or indirectly owned or controlled by an investor of the other Party; and
(d) existing on the date of entry into force of this Agreement, or made or acquired thereafter;
customs administration means the governmental authority that is responsible under the law of a Party for the administration of customs laws and regulations or any successor of such customs administration;
Customs Valuation Agreement means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 in Annex 1A of the WTO Agreement;
days means calendar days, including weekends and holidays;
enterprise means any entity constituted or organised under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organisation;
existing means in effect on the date of entry into force of this Agreement;
GATS means the General Agreement on Trade in Services Annex 1B of the WTO Agreement;
GATT 1994 means the General Agreement on Tariffs and Trade 1994 in Annex 1A of the WTO Agreement;
goods means any merchandise, product, article, or material;
Harmonized System (HS) means the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, Chapter Notes, and Subheading Notes as set out in the Annex to the International Convention on the Harmonized Commodity Description and Coding System, done at Brussels on 14 June 1983, as may be amended, and as adopted and implemented by the Parties in their respective laws;
heading means the first four digits in the tariff classification number under the Harmonized System; measure means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;
national means a natural person who is:
(a) for Canada, a Canadian citizen or permanent resident under Canadian law;
(b) for Indonesia, an Indonesian national as defined in Law No. 12/2006, as amended, or any successor legislation;
perishable goods means goods that rapidly decay due to their natural characteristics, in particular in the absence of appropriate storage conditions;
person means a natural person or an enterprise;
person of a Party means a national of a Party or an enterprise of a Party;
preferential tariff treatment means the customs duty rate applicable to an originating good under this Agreement; regional government means:
(a) for Canada, a province or territory of Canada;
(b) for Indonesia, a province of Indonesia, as defined under Indonesian law;
Safeguards Agreement means the Agreement on Safeguards in Annex 1A to the WTO Agreement;
sanitary or phytosanitary measure means a measure referred to in paragraph 1 of Annex A to the SPS Agreement;
SCM Agreement means the Agreement on Subsidies and Countervailing Measures in Annex 1A to the WTO Agreement;
SPS Agreement means the Agreement on the Application of Sanitary and Phytosanitary Measures in Annex 1A to the WTO Agreement;
state enterprise means an enterprise that is owned, or controlled through ownership interests, by a Party;
subheading means the first six digits in the tariff classification number under the Harmonized System;
territory means:
(a) with respect to Canada,
(i) the land territory, air space, internal waters, and territorial sea of Canada,
(ii) the exclusive economic zone of Canada, and
(iii) the continental shelf of Canada, as determined by its domestic law and consistent with international law;
(b) with respect to Indonesia, the land territories, internal waters, archipelagic waters, territorial sea, including the seabed and subsoil thereof, and airspace over such territories and waters, as well as the contiguous zone, the continental shelf and exclusive economic zone, over which Indonesia has sovereignty, sovereign rights or jurisdiction as defined in its laws, and in accordance with international law, including the United Nations Convention on the Law of the Sea, done at Montego Bay on 10 December 1982;
TRIPS Agreement means the Agreement on Trade-Related Aspects of Intellectual Property Rights in Annex 1C to the WTO Agreement;
WTO means the World Trade Organization; and
WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994.
Chapter 2. NATIONAL TREATMENT AND MARKET ACCESS FOR GOODS
Article 2.1. Definitions
For the purposes of this Chapter:
Agreement on Agriculture means the Agreement on Agriculture, contained in Annex 1A to the WTO Agreement; agricultural good means a product listed in Annex 1 to the 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;
customs duty means a duty or a charge of any kind imposed on or in connection with the importation of a good, including a form of surtax or surcharge imposed on or in connection with that importation, but does not include:
(a) a charge equivalent to an internal tax imposed consistently with Article III:2 of the GATT 1994;
(b) an anti-dumping or countervailing duty;
(c) a fee or other charge imposed in connection with the importation commensurate with the cost of services rendered; and
(d) a payment or a security offered or collected related to an imported good arising out of any tendering system in respect of the administration of quantitative import restrictions or tariff rate quotas;
duty-free means free of customs duty;
export licensing procedure means a requirement that a Party adopts or maintains under which an exporter must, as a condition for exporting a good from the Party’s territory, submit an application or other documentation to an administrative body or bodies, but does not include customs documentation required in the normal course of trade or any requirement that must be fulfilled prior to introduction of the good into commerce within the Party’s territory;
export subsidy means an export subsidy as defined in Article 1(e) of the Agreement on Agriculture;
goods of a Party means domestic products as these are understood in the GATT 1994 or such goods as the Parties may agree, and includes originating goods of a Party;
import licensing means an administrative procedure 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;
Import Licensing Agreement means the Agreement on Import Licensing Procedures, contained in Annex 1A to the WTO Agreement;
low level presence (LLP) occurrence means the inadvertent low level presence in a shipment of plants or plant products, except for a plant or plant product that is a medicine or medical product, of rDNA plant material that is authorized for use in at least one country, but not in the importing country, and if authorized for food use, a food safety assessment has been done based on the Codex Guideline for the Conduct of a Food Safety Assessment of Foods Derived from Recombinant-DNA Plants (CAG/GL 45-2003).
modern biotechnology means the application of:
(a) in vitro nucleic acid techniques, including recombinant DNA and direct injection of nucleic acid into cells or organelles; or
(b) fusion of cells beyond the taxonomic family,
that overcome natural physiological reproductive or recombination barriers and that are not techniques used in traditional breeding and selection;
product of modern biotechnology means an agricultural good, or a fish or fish product covered by Chapter 3 of the Harmonized System (HS) intended for food and feed, developed using modern biotechnology, but does not include a medicine or a medical product.
Article 2.2. Scope
Except as otherwise provided in this Agreement, this Chapter applies to trade in goods between the Parties.
Article 2.3. National Treatment
1. Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of the GATT 1994, including its interpretative notes, and to this end, Article III of the GATT 1994 and its interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.
2. For greater certainty, the treatment to be accorded by a Party under paragraph 1 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment that the regional level of government accords to any like, directly competitive or substitutable goods, as the case may be, of the Party of which it forms a part.
3. This Article does not apply to a measure, including a measure’s continuation, prompt renewal or amendment, in respect of excise duties on absolute alcohol, as listed under tariff item 2207.10.90 in each Party’s Schedule of Concessions annexed to the GATT 1994 and the internal sale and distribution of wine and distilled spirits.
Article 2.4. Elimination of Customs Duties on Imports
1. Except as otherwise provided in this Agreement, a Party shall not increase any existing customs duty, or adopt any new customs duty, on an originating good.
2. Except as otherwise provided in this Agreement, each Party shall eliminate its customs duties on originating goods in accordance with its Schedule to Annex 2-A (Tariff Commitments).
3. On the request of a Party, the Parties shall consult to consider accelerating or broadening the scope of the elimination of customs duties set out in their Schedules to Annex 2-A (Tariff Commitments). An agreement between the Parties to accelerate or broaden the scope of the elimination of a customs duty on an originating good shall supersede any customs duty rate or staging category determined pursuant to each Party’s Schedule to Annex 2-A(Tariff Commitments) for that good in accordance with and upon completion of each Party's applicable legal procedures.
4. A Party may at any time unilaterally accelerate or broaden the scope of the elimination of customs duties set out in its Schedule to Annex 2-A (Tariff Commitments) on originating goods of the other Party. A Party shall inform the other Party as early as practicable before the new rate of customs duties takes effect.
5. For greater certainty, a Party shall not prohibit an importer from claiming for an originating good the rate of customs duty applied under the WTO Agreement.
6. For greater certainty, a Party may:
(a) modify its tariffs on goods for which no tariff preference is claimed under this Agreement;
(b) increase a customs duty to the level established in its Schedule to Annex 2-A(Tariff Commitments) after a unilateral reduction; or
(c) maintain or increase a customs duty as authorized by this Agreement, the Dispute Settlement Body of the WTO, or an agreement under the WTO Agreement.
Article 2.5. Classification of Goods and Transposition of Tariff Commitments
1. The classification of goods in trade between the Parties shall be in conformity with the Harmonized System (HS) and its amendments.
2. At the request of a Party, the Parties shall share information on those tariffitems if any revisions are necessary, to ensure that each Party’s obligations under this Agreement are not altered by its implementation of future amendments to the Harmonized System (HS) into its national nomenclature.
3. At the request of a Party, the Committee on Trade in Goods may review the future amendments to the Harmonized System (HS) to ensure that each Party’s obligations under this Agreement are not altered, including by establishing, as needed, guidelines for the transposition of Parties’ Schedules to Annex 2-A (Tariff Commitments) and consult to resolve any differences that may arise between the Parties on matters related to the Harmonized System (HS).
Article 2.6. Agricultural Special Safeguards
Originating agricultural goods traded under preferential tariff treatment shall not be subject to any duties that the importing Party applies pursuant to a special safeguard it takes pursuant to the Agreement on Agriculture. (1)
Article 2.7. Import and Export Restrictions
1. Except as otherwise provided in this Agreement, a 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 Article XI of the GATT 1994, including its interpretative notes, and to this end, Article XI of the GATT 1994 and its interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.
2. The Parties understand that GATT 1994 rights and obligations incorporated by paragraph 1 prohibit, in any circumstances in which any other form of restriction is prohibited, a Party from adopting or maintaining: (a) export or import pricerequirements, except as permitted in enforcement of countervailing and antidumping duty orders or undertakings; or (b) voluntary export restraints inconsistent with Article VI of the GATT 1994, as implemented under Article 18 of the SCM Agreement and Article 8.1 of the AD Agreement.
3. Except as otherwise provided in this Agreement, a Party shall not adopt or maintain any measure prohibited by Article 4.2 of the Agreement on Agriculture with respect to goods of the other Party. To this end, Article 4.2 of the Agreement on Agriculture is incorporated into and made part of this Agreement. (2)
4. If a Party adopts or maintains a prohibition or restriction on the importation from or exportation to a non-Party of a good, nothing in this Agreement shall be construed to prevent that Party from:
(a) limiting or prohibiting the importation of the good of that non-Party from the territory of the other Party; or
(b) requiring, as a condition for exporting the good of that Party to the territory of the other Party, that the good not be re-exported to the non-Party, directly or indirectly, without being consumed in the territory of the other Party.
5. For the purposes of this Article, consumed means:
(a) actually consumed; or
(b) further processed or manufactured so as to result in a substantial change in the value, form or use of the good, or in the production of another good.
6. If a Party adopts or maintains a prohibition or restriction on the importation of a good from a non-Party, the Parties, on the request of a Party, shall consult with a view to avoiding undue interference with or distortion of pricing, marketing or distribution arrangements in the other Party.
7. This Article does not apply to a measure, including that measure’s continuation, prompt renewal or amendment, in respect of the following:
(a) excise duties on absolute alcohol, as listed under tariff item 2207.10.90 in a Partys’ Schedule of Concessions annexed to the GATT 1994;
(b) the importation of goods of the prohibited provisions of tariff items 9897.00.00, 9898.00.00, and 9899.00.00 referred to in the Schedule of the Customs Tariff;
(c) the use of ships in the coasting trade of each Party’s own territory;
(d) the export of logs of all species; and
(e) the export of unprocessed fish pursuant to applicable provincial legislation.
Article 2.8. Agricultural Export Subsidies
1. The Parties affirm their rights and obligations under the Nairobi WTO Ministerial Decision of 19 December 2015 on Export Competition. (3)
2. The Parties share the objective of the multilateral elimination of export subsidies for agricultural goods and shall work together to prevent their reintroduction in any form.
3. A Party shall not adopt or maintain a measure on an agricultural good that is not consistent with the Nairobi WTO Ministerial Decision of 19 December 2015 on Export Competition.
Article 2.9. Transparency In Import Licensing Procedures
1. Each Party shall ensure that its import licensing procedures are implemented in a transparent and predictable manner, and applied in accordance with the Import Licensing Agreement.