(b) for Korea, the Multilateral Trade Bureau of the Ministry of Foreign Affairs and Trade, or its successor.
Chapter 19. DISPUTE SETTLEMENT
Section A. Dispute Settlement
Article 19.1. Cooperation
The Parties shall at all times endeavour to agree on the interpretation and application of this Agreement, and shall make every attempt through cooperation and consultations to arrive at a mutually satisfactory resolution of any matter that might affect its operation.
Article 19.2. Scope of Application
Except as otherwise provided in this Agreement, the provisions of this Chapter shall apply:
(a) with respect to the avoidance and settlement of disputes between the Parties regarding the interpretation or application of this Agreement; or
(b) wherever a Party considers that an existing or proposed measure of the other Party is or would be inconsistent with the obligations of this Agreement or causes nullification or impairment in the sense of Annex 19.2.
Article 19.3. Choice of Forum
1. Disputes regarding any matter arising under both this Agreement and the WTO Agreement, any agreement negotiated thereunder, or any successor agreement, may be settled in the forum selected by the complaining Party.
2. Once dispute settlement procedures have been initiated under Article 19.6 or dispute settlement proceedings have been initiated under the WTO Agreement, the forum selected shall be used to the exclusion of the other.
3. For purposes of this Article, dispute settlement proceedings under the WTO Agreement are deemed to be initiated upon a request for a panel by a Party.
Article 19.4. Consultations
1. A Party may request in writing consultations with the other Party regarding any existing or proposed measure or any other matter that it considers might affect the operation and application of this Agreement.
2. The Party that requests consultations according to paragraph 1 shall indicate the provisions of the Agreement that it considers relevant and deliver the request to the other Party.
3. Consultations on matters regarding perishable agricultural goods shall commence within 15 days of the date of delivery of the request.
4. The Parties shall:
(a) provide information to enable a full examination of how the existing or proposed measure or other matter might affect the operation and application of this Agreement; and
(b) give confidential treatment to any information exchanged in the course of consultations.
Article 19.5. Good Offices, Conciliation and Mediation
1. Good offices, conciliation and mediation are procedures undertaken voluntarily if the Parties so agree.
2. Proceedings involving good offices, conciliation and mediation, and in particular positions taken by the Parties during these proceedings, shall be confidential, and without prejudice to the rights of either Party in any further proceedings under these procedures.
3. Good offices, conciliation or mediation may be requested at any time by any Party. They may begin at any time and be terminated at any time. Once procedures for good offices, conciliation or mediation are concluded without an agreement between the Parties, the complaining Party may request the establishment of a panel.
Article 19.6. Request for an Arbitral Panel
1. A Party may request in writing the establishment of an arbitral panel if the matter has not been resolved pursuant to Article 19.4, within:
(a) 45 days of delivery of a request for consultations;
(b) 30 days of delivery of a request for consultations in matters regarding perishable agricultural goods; or
(c) such other period as the Parties may agree.
2. A Party may also request in writing the establishment of an arbitral panel where consultations have been held pursuant to Article 8.12.
3. Upon delivery of the request, an arbitral panel shall be established. 4. Unless otherwise agreed by the Parties, the panel shall be established and perform its functions in accordance with the provisions of this Chapter.
Article 19.7. Roster
1. The Parties shall establish, by mutual agreement, no later than six months after the entry into force of this Agreement a roster of up to 15 individuals, one-third of whom shall not be nationals of either Party, who are willing and qualified to serve as panelists. The roster members shall be appointed for a term of three years, and will automatically be reappointed for an additional three-year term, unless either Party objects.
2. Roster members shall:
(a) have expertise or experience in law, international trade, other matters covered by this Agreement or the resolution of disputes arising under international trade agreements;
(b) be chosen strictly on the basis of objectivity, reliability and sound judgment;
(c) be independent of, not be affiliated with or take instructions from, either Party; and
(d) comply with the Code of Conduct set out in Annex 19.7.
Article 19.8. Qualifications of Panelists
1. All panelists shall meet the qualifications set out in Article 19.7.2.
2. Individuals may not serve as panelists for a dispute in which they have participated pursuant to Article 19.5.
Article 19.9. Panel Selection
1. The panel shall comprise three members.
2. Each Party shall select one panelist within 15 days from the delivery of the request for the establishment of the panel.
3. Within 15 days of the selection of the panelists under paragraph 2, the Parties shall agree on the chair of the panel. If the Parties are unable to agree on the chair within this period, the chairperson of the Commission shall select by lot the chair of the panel within five days, from among the roster members who are not nationals of either Party.
4. If a Party fails to select its panelist within the period indicated in paragraph 2, the chairperson of the Commission shall select by lot the panelist within five days, from among the roster members who are nationals of that Party.
5. Panelists shall normally be selected from the roster. 6. Ifa Party believes that a panelist is in violation of the Code of Conduct set out in Annex
19.7, the Parties shall consult and if they agree, the panelist shall be removed and a new panelist shall be selected in accordance with this Article.
Article 19.10. Model Rules of Procedure
1. Unless the Parties otherwise agree, the panel shall conduct its proceedings in accordance with the Model Rules of Procedure set out in Annex 19.10.
2. The Commission may amend when it considers necessary the Model Rules of Procedure referred to in paragraph 1.
Article 19.11. Information and Technical Advice
Upon request of a Party, or on its own initiative, the panel may seek information and technical advice from any person or body that it deems appropriate. Any information and technical advice so obtained shall be submitted to the Parties for comments.
Article 19.12. Initial Report
1. Unless the Parties otherwise agree, the panel shall base its report on the relevant provisions of this Agreement, on the submissions and arguments of the Parties, and on any information before it, pursuant to Article 19.11.
2. Unless the Parties otherwise agree, the panel shall, within 90 days after the last panelist is selected, present to the Parties an initial report containing:
(a) findings of fact, including any findings pursuant to a request under Rule 8 of Annex 19.10;
(b) its determination as to whether the measure at issue is or would be inconsistent with the obligations of this Agreement or cause nullification or impairment in the sense of Annex 19.2, or any other determination requested in the terms of reference; and
(c) its recommendations, if any, for resolution of the dispute.
3. Panelists may furnish separate opinions on matters not unanimously agreed.
4. The Parties may submit written comments on the initial report within 14 days of its presentation.
5. Incase that such written comments by the Parties are received as provided for in paragraph 4, the panel, on its own initiative or at the request of a Party, may reconsider its report and make any further examination that it considers appropriate after considering such written comments.
Article 19.13. Final Report
1. The panel shall present a final report to the Parties, including any separate opinions on matters not unanimously agreed, within 30 days of presentation of the initial report, unless the Parties otherwise agree.
2. No panel may, either in its initial report or its final report, disclose which panelists are associated with the majority or minority of the opinions.
3. The final report of the panel shall be made publicly available within 15 days of its delivery to the Parties.
Article 19.14. Implementation of Final Report
1. The final report of a panel shall be binding on the Parties and shall not be subject to appeal. Unless the Parties decide otherwise, they shall implement the decision contained in the final report of the panel in the manner and within the time-frame that it orders.
2. Notwithstanding paragraph 1, where the final report of the panel states that a measure is not in compliance with this Agreement, or is causing nullification or impairment in the sense of Annex 19.2, the responding Party, wherever possible, shall abstain from executing the measure or shall abrogate it.
Article 19.15. Non-Implementation - Suspension of Benefits
1. The complaining Party may suspend the application of benefits of equivalent effect to the Party complained against if the panel resolves:
(a) that a measure is inconsistent with the obligations of this Agreement and the responding Party does not implement the final report within 30 days following the expiration of the time-frame established in such a report; or
(b) that a measure causes nullification or impairment in the sense of Annex 19.2 and the Parties do not reach a mutually satisfactory agreement on the dispute within 30 days following the expiration of the time-frame established in the final report.
2. The suspension of benefits shall last until the responding Party implements the decision of the panel's final report or until the Parties reach a mutually satisfactory agreement on the dispute, depending on the case.
3. In considering what benefits to suspend pursuant to paragraph 1:
(a) the complaining Party should first seek to suspend benefits in the same sector(s) as that affected by the measure or other matter that the panel has found to be inconsistent with the obligations derived of this Agreement or to have caused nullification or impairment in the sense of Annex 19.2; and
(b) if the complaining Party considers that it is not practicable or effective to suspend benefits in the same sector(s), it may suspend benefits in other sectors. The communication in which it announces such a decision shall indicate the reasons on which it is based.
4. Upon written request of the Party concerned, the original panel shall determine whether the level of benefits suspended by the complaining Party is excessive pursuant to paragraph 1. If the panel cannot be established with its original members, the proceeding set out in Article 19.9 shall be applied.
5. The panel shall present its determination within 60 days from the request made pursuant to paragraph 4, or if a panel cannot be established with its original members, from the date on which the last panelist is selected. The ruling of the panel shall be final and binding. It shall be delivered to the Parties and be made publicly available.
Section B. Domestic Proceedings and Private Commercial Dispute Settlement
Article 19.16. Interpretation of the Agreement Before Judicial and Administrative Proceedings
1. If an issue of interpretation or application of this Agreement arises, in any domestic judicial or administrative proceeding of a Party, which that Party considers would merit its intervention, or if a judicial or administrative body requests the views of a Party in this regard, that Party shall notify the other Party. The Commission shall endeavour to agree on an appropriate response as expeditiously as possible.
2. The Party in whose territory the judicial or administrative body is located shall submit any agreed interpretation of the Commission to such a body, in accordance with the rules of that forum.
3. If the Commission does not reach an agreement, any Party may submit its own views to the judicial or administrative body in accordance with the rules of that forum.
Article 19.17. Private Rights
Neither Party may provide for a right of action for private parties under its domestic law against the other Party on the ground that a measure of the other Party is inconsistent with this Agreement.
Article 19.18. Alternative Dispute Resolution
1. Each Party shall, to the maximum extent possible, encourage and facilitate the use of arbitration proceeding and other means of alternative dispute resolution for the settlement of international commercial disputes between private parties in the free trade area.
2. To this end, each Party shall provide appropriate procedures to ensure observance of agreements to arbitrate and for the recognition and enforcement of arbitral awards in such disputes under paragraph 1.
3. A Party shall be deemed to be in compliance with paragraph 2 if it is a party to and is in compliance with the 1958 United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
Annex 19.2. Nullification or Impairment
1. A Party may have recourse to the dispute settlement procedures under this Chapter if the application of any measure that is not inconsistent with this Agreement, results in nullification or impairment of any benefit that is reasonably expected to accrue to it under any of the following provisions contained in:
(a) Part I;
(b) Chapter 11; and
(c) Chapter 15.
2. With respect to any measure subject to an exception under Article 20.1, the Parties may not invoke:
(a) subparagraphs 1(a) and (c), to the extent that the benefit arises from any cross- border trade in services provision of Part II; or
(b) subparagraph 1(b).
Annex 19.7. Code of Conduct for Members of Panels
Definitions
1. For purposes of this Annex:
assistant means a person who, under the terms of appointment of a member, conducts research or provides support for the member;
candidate means an individual whose name is on the roster referred to in Article 19.7 and who is under consideration for appointment as a member of a panel under Article 19.9;
member means a member of a panel effectively established under Article 19.6; proceeding, unless otherwise specified, means a panel proceeding under Chapter 19; and
staff, in respect of a member, means persons under the direction and control of the member, other than assistants.
Section I. Responsibilities to the Process
2. Every candidate and member shall avoid impropriety and the appearance of impropriety, be independent and impartial, avoid direct and indirect conflicts of interests and observe high standards of conduct so that the integrity and impartiality of the dispute settlement process are preserved. Former members shall comply with the obligations established in Sections V and VI of this Code of Conduct.
Section II. Disclosure Obligations
3. Prior to confirmation of his or her selection as a member of the panel under Article 19.9, a candidate shall disclose any interest, relationship or matter that is likely to affect his or her independence or impartiality or that might reasonably create an appearance of impropriety or bias in the proceeding. To this end, a candidate shall make all reasonable efforts to become aware of any such interests, relationships and matters.
4. Once selected, a member shall continue to make all reasonable efforts to become aware of any interests, relationships and matters referred to in Rule 3 and shall disclose them by communicating them in writing to the Commission for consideration by the Parties. The obligation to disclose is a continuing duty, which requires a member to disclose any such interests, relationships and matters that may arise during any stage of the proceeding.
Section III. Performance of Duties by Candidates and Members
5. A candidate who accepts a selection as a member shall be available to perform, and shall perform, a member's duties thoroughly and expeditiously throughout the course of the proceeding.
6. A member shall carry out all duties fairly and diligently. 7. Amember shall comply with this Code of Conduct.
8. A member shall not deny other members the opportunity to participate in all aspects of the proceeding.
9. A member shall consider only those issues raised in the proceeding and necessary to rendering a decision and shall not delegate the duty to decide to any other person.
10. A member shall take all reasonable steps to ensure that the member's assistant and staff comply with Sections I, II and VI of this Code of Conduct.
11. A member shall not engage in ex parte contacts concerning the proceeding.
12. A candidate or member shall not communicate matters concerning actual or potential violations of this Code of Conduct unless the communication is to the Commission or is necessary to ascertain whether that candidate or member has violated or may violate this Code.
Section IV. Independence and Impartiality of Members
13. A member shall be independent and impartial. A member shall act in a fair manner and shall avoid creating an appearance of impropriety or bias.
14. A member shall not be influenced by self-interest, outside pressure, political considerations, public clamour, loyalty to a Party or fear of criticism.
15. A member shall not, directly or indirectly, incur any obligation or accept any benefit that would in any way interfere, or appear to interfere, with the proper performance of the member's duties.
16. A member shall not use his or her position on the panel to advance any personal or private interests. A member shall avoid actions that may create the impression that others are in a special position to influence the member. A member shall make every effort to prevent or discourage others from representing themselves as being in such a position.
17. A member shall not allow past or existing financial, business, professional, family or social relationships or responsibilities to influence the member's conduct or judgement.
18. A member shall avoid entering into any relationship, or acquiring any financial interest, that is likely to affect the member's impartiality or that might reasonably create an appearance of impropriety or bias.
Section V. Duties In Certain Situations
19. A member or former member shall avoid actions that may create the appearance that the member was biased in carrying out the member's duties or would benefit from the decision or ruling of the panel.
Section VI. Maintenance of Confidentiality
20. A member or former member shall not at any time disclose or use any non-public information concerning the proceeding or acquired during the proceeding except for the purposes of the proceeding and shall not, in any case, disclose or use any such information to gain personal advantage or advantage for others or to affect adversely the interest of others people.
21. A member shall not disclose a panel ruling prior to its publication.
22. A member or former member shall not at any time disclose the deliberations of a panel, or any member's view.
Section VII. Responsibilities of Assistants and Staff
23. Sections I, II and VI of this Code of Conduct apply also to assistants and staff.
Annex 19.10. Model Rules of Procedure Application
1. These Rules are established under Article 19.10 and shall apply to dispute settlement proceedings under Chapter 19 unless the Parties otherwise agree.
Definitions
2. For purposes of this Annex:
adviser means a person retained by a Party to advise or assist the Party in connection with the panel proceeding;
complaining Party means a Party that requests the establishment of a panel under Article 19.6; legal holiday, with respect to a Party's Secretariat, means every Saturday and Sunday and any other day designated by that Party as a holiday for purposes of these Rules and notified by that Party to its Secretariat and by that Secretariat to the other Secretariat and the other Party;
panel means a panel established under Article 19.6;
representative of a Party means an employee of a government department or of any other government entity of a Party;
responsible Secretariat means the Secretariat of the Party complained against; and
Secretariat means the Secretariat established under Article 18.2.1.
3. Any reference made in these Rules to an Article, Annex or Chapter is a reference to the appropriate Article, Annex or Chapter of this Agreement.
Terms of Reference for Panels
4. Unless the Parties otherwise agree within 20 days from the date of the delivery of the request for the establishment of the panel, the terms of reference shall be:
"To examine, in the light of the relevant provisions of this Agreement, the matter referred to the panel and deliver the written reports referred to in Articles 19.13 and 19.14."
5. The Parties shall promptly deliver the agreed terms of reference to the panel, upon the designation of the last panelist.
6. If the complaining Party argues that a matter has nullified or impaired benefits, the terms of reference shall so indicate.
7. If a Party requests the panel to make findings as to the degree of adverse trade effects on a Party of the measure found not to conform with the obligations of the Agreement or to have caused nullification or impairment in the sense of Annex 19.2, the terms of reference shall so indicate.