(a) The Parties shall ensure that technical regulations, standards and conformity assessment procedures, are not prepared, adopted or applied with a view to, or with an effect of, creating unnecessary obstacles to trade between the Parties, subject to the provisions of the TBT Agreement.
(b) The Parties shall endeavour where possible to harmonise their standards, technical regulations and conformity assessment procedures.
5. Transparency and notification
(a) Obligations concerning the sharing of information on technical regulations, standards and conformity assessment procedures provided for by the TBT Agreement shall apply between the Parties.
(b) The Parties agree to exchange information on issues of potential relevance to their trade relations, including rapid alerts, scientific opinions and events through contact points.
(c) The Parties may cooperate in the establishment and maintenance of contact points, and in the setting up and maintenance of common data bases.
Chapter V. Sanitary and Phytosanitary Measures
Article 22. Sanitary and Phytosanitary Measures
1. The Parties shall cooperate in the area of Sanitary and Phytosanitary measures with the objective of facilitating trade while protecting human, animal or plant life or health. The provisions of the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (hereinafter referred to as the "SPS Agreement"), which is incorporated into and made part of this Agreement, shall apply between the Parties, mutatis mutandis.
2. On request the Parties may identify and address problems arising from the application of specific SPS-measures with a view to reaching mutually acceptable solutions.
Section II. Trade In Services and Establishment
Article 23. Coverage
1. This Section hereby lays down the necessary arrangements for the progressive liberalisation of trade in services and establishment between the Parties.
2. This Section applies to measures affecting trade in services and establishment 1 in all economic activities, with the exception of:
(a) mining, manufacturing and processing of nuclear materials;
(b) production of or trade in arms, munitions and war material;
(c) audio-visual services and cultural services;
(d) education services;
Investment protection, other than the treatment deriving from Article 25, including investor-state dispute settlement procedures, is not covered by this Section.
(e) health and social services;
(f) national maritime cabotage;
(g) air transport services and services auxiliary to air transport other than:
(i) aircraft repair and maintenance services during which an aircraft is withdrawn from service;
(ii) the selling and marketing of air transport services;
(iii) computer reservation system services;
(iv) ground handling services;
(v) rental services of aircraft with crew;
(vi) airport operation services; and
(h) space transport services.
3. Nothing in this Section shall be construed to impose any obligation with respect to government procurement.
4. The provisions of this Section shall not apply to subsidies granted by the Parties.
5. Consistent with the provisions of this Section, each Party retains the right to regulate and to introduce new regulations to meet legitimate policy objectives.
Article 24. Definitions
For the purposes of this Section:
(a) a "natural person of the Union" means a national of one of the Member States of the Union according to its legislation and a "natural person of Iraq" means a national of Iraq according to its legislation;
(b) a "juridical person" means any legal entity duly constituted or otherwise organised under applicable law, whether for profit or otherwise, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, joint venture, sole proprietorship or association;
(c) a "juridical person of the Union" or a "juridical person of Iraq" means a juridical person set up in accordance with the laws of a Member State of the Union or of Iraq, respectively, and having its registered office, central administration, or principal place of business in the territory to which the Treaty on European Union and the Treaty on the Functioning of the European Union apply or in the territory of Iraq, respectively. Should the juridical person have only its registered office, central administration, or principal place of business in the territory to which the Treaty on European Union and the Treaty on the Functioning of the European Union apply or in the territory of Iraq, respectively, it shall not be considered as a juridical person of the Union or a juridical person of Iraq, respectively, unless its operations possess a real and continuous link with the economy of the Union or of Iraq, respectively;
(d) notwithstanding point (c), shipping companies established outside the Union or Iraq and controlled by nationals of a Member State of the Union or of Iraq, respectively, shall also be beneficiaries of the provisions of this Agreement, if their vessels are registered in accordance with their respective legislation, in that Member State of the Union or in Iraq, and carry the flag of a Member State of the Union or of Iraq;
(e) "economic activity" does not include activities carried out in the exercise of governmental authority, which means activities carried out neither on a commercial basis nor in competition with one or more economic operators;
(f) "subsidiary" means a juridical person which is effectively controlled by another juridical person 1;
(g) "branch" of a juridical person means a place of business not having legal personality which has the appearance of permanency, such as the extension of a parent body, has a management and is materially equipped to negotiate business with third parties so that the latter, although knowing that there will if necessary be a legal link with the parent body, the head office of which is abroad, do not have to deal directly with such parent body but may transact business at the place of business constituting the extension.
(h) "service suppliers" of a Party means any natural or juridical person of a Party that seeks to supply or supplies a service;
(i) "trade in services" is defined as the supply of a service through the following modes:
(i) from the territory of a Party into the territory of the other Party;
(ii) in the territory of a Party to the service consumer of the other Party;
(iii) by a service supplier of a Party, through establishment in the territory of the other Party;
(iv) by a service supplier of a Party, through presence of natural persons in the territory of the other Party;
A juridical person is controlled by another juridical person if the latter has the power to name a majority of its directors or otherwise to legally direct its actions.
(j) "measure" means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;
(k) "measures adopted or maintained by a Party" means measures taken by:
(i) central, regional or local governments and authorities; and
(ii) non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities;
(l) "services" includes any service in any sector except services supplied in the exercise of governmental authority;
(m) "establishment" means any type of business or professional establishment through:
(i) the constitution, acquisition or maintenance of a juridical person 1, or
(ii) the creation or maintenance of a branch or representative office within the territory of a Party for the purpose of performing an economic activity;
The terms "constitution" and "acquisition" of a juridical person shall be understood as including capital participation in a juridical person with a view to establishing or maintaining lasting economic links.
(n) "investor" of a Party means any natural or juridical person that seeks to perform or performs an economic activity through setting up an establishment;
(o) a "service supplied in the exercise of governmental authority" means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.
Article 25.
1. From the entry into force of this Agreement the Union shall extend to services or service suppliers of the Iraq the treatment resulting from the schedule of specific commitments of the Union and its Member States on national treatment and market access under the General Agreement on Trade in Services (hereinafter referred to as the "GATS").
Treatment arising from commitments of the Union on the supply of services by contractual services suppliers and independent professionals shall be excluded from this provision. Treatment deriving from agreements concluded by the Union or its Members States providing for mutual recognition in accordance with Article VII of the GATS, shall also be excluded from this provision.
2. From the entry into force of this Agreement, and subject to paragraph 3, the Iraq shall grant to services, service suppliers, establishments and investors of the Union in the services and non-services sector, treatment no less favourable than that granted to like services, services suppliers, establishments and investors 1 of Iraq or to like services, service suppliers, establishments and investors of any third country, whichever is the better.
3. Iraq may modify the treatment granted to services, service suppliers, establishments and investors of the Union by subjecting it to conditions and qualifications which result in treatment less favourable than that granted to its own like services, service suppliers, establishments and investors. Such modification shall respect the following conditions:
(a) The treatment granted to services, services suppliers, establishments and investors of the Union shall remain no less favourable than that granted by Iraq to like services, service suppliers, establishments and investors of any third country.
Iraq may meet the requirement of this paragraph by according to services, service suppliers, establishments and investors of the Union, either formally identical treatment or formally different treatment to that it accords to its own like services, service suppliers, establishments and investors. 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 Iraq compared to like services, service suppliers, establishments and investors of the Union.
(b) Iraq shall notify such intention to the Commission of the European Union (hereinafter referred to as "the Commission") 1 four months before the intended date of implementation of such conditions. At the request of the Commission, the Iraq shall provide detailed information on the reasons that justify the intended imposition of conditions and qualifications. These conditions and qualifications shall be deemed accepted by the Union if no communication is sent to Iraq within eight weeks.
(c) At the request of any Party, the proposed conditions and qualifications shall be referred to the Cooperation Committee for examination and approval.
4. Without prejudice to the benefits arising from the treatment granted to services, service suppliers, establishments and investors of the Union pursuant to paragraph 2 of this article, following its accession to the WTO, Iraq shall also extend to services or service suppliers of the Union the treatment resulting from its schedule of specific commitments under the GATS.
For greater certainty, the notification should be addressed to the Director General of the Directorate General for Trade, or its successor.
Article 26.
1. The most-favoured-nation treatment granted in accordance with the provisions of this Section shall not apply to tax advantages which the Parties are providing or will provide in the future on the basis of agreements to avoid double taxation, or other tax arrangements.
2. Nothing in this Section shall be construed to prevent the adoption or enforcement by the Parties of any measure aimed at preventing the avoidance of taxes pursuant to the tax provisions of agreements to avoid the double taxation and other tax arrangements, or domestic fiscal legislation.
3. Nothing in this Section shall be construed to prevent the Member States or Iraq from distinguishing, in the application of the relevant provisions of their fiscal legislation, between taxpayers who are not in identical situations, in particular as regards their place or residence.
Article 27. Other Agreements
Nothing in this Section shall limit the rights of investors of the Parties to benefit from any more favourable treatment provided for in any existing or future international agreement relating to investment to which a Member State of the Union and Iraq are Parties.
Article 28. Transparency
Each Party shall respond promptly to all requests by the other Party for specific information on any of its measures of general application or international agreements which pertain to or affect this Agreement. Each Party shall also establish one or more enquiry points to provide specific information to services providers of the other Party, upon request, on all such matters. Such enquiry points are listed in ANNEX 3. Enquiry points need not be depositories of laws and regulations.
Article 29. Exceptions
1. The provisions of this Section are subject to the exceptions contained in this Article. Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail, or a disguised restriction on trade in services, nothing in this Section shall be construed to prevent the adoption or enforcement by any Party of measures:
(a) necessary to protect public security or public morals or to maintain public order;
(b) necessary to protect human, animal or plant life or health;
(c) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Section including those relating to:
(i) the prevention of deceptive and fraudulent practices or to deal with the effects of a default on services contracts;
(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts;
(iii) safety;
(d) inconsistent with the objectives of Article 25, provided that the difference in treatment is aimed at ensuring the effective or equitable imposition or collection of direct taxes in respect of services or service suppliers of the other Party;
(e) inconsistent with the objectives of Article 25, provided that the difference in treatment is aimed at preventing the avoidance or evasion of taxes pursuant to the tax provisions of agreements to avoid double taxation or other tax arrangements or domestic fiscal legislation.
2. The provisions of this Section shall not apply to the Parties' respective social security systems or to activities in the territory of each Party, which are connected, even occasionally, with the exercise of official authority.
3. The provisions of this Section shall not apply to measures affecting natural persons seeking access to the employment market of a Party, nor shall it apply to measures regarding citizenship, residence or employment on a permanent basis.
4. Nothing in this Section shall prevent a Party from applying measures to regulate the entry of natural persons into, or their temporary stay in, its territory, including those measures necessary to protect the integrity of, and to ensure the orderly movement of natural persons across, its borders, provided that, in so doing, it does not apply them in a manner as to nullify or impair the benefits accruing to the other Party under Article 25 1.
5. Nothing in this Section applies to activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary or exchange rate policies.
6. Nothing in this Section shall be construed to prevent a Party, including its public entities, from exclusively conducting or providing in its territory activities or services for the account or with the guarantee or using the financial resources of the Party, or its public entities.
7. The provisions of this Section shall not prejudice the application by each Party of any measures necessary to prevent the circumvention of its measures concerning third country access to its market, through the provisions of this Agreement.
The sole fact of requiring a visa shall not be regarded as nullifying or impairing those benefits.
Article 30. Security Exceptions
Nothing in this Section shall be construed:
(a) to require any Party to furnish any information, the disclosure of which it considers contrary to its essential security interests; or
(b) to prevent any Party from taking any action which it considers necessary for the protection of its essential security interests:
(i) relating to economic activities carried out directly or indirectly for the purpose of provisioning a military establishment;
(ii) relating to fissionable and fusionable materials or the materials from which they are derived;
(iii) connected with the production of or trade in arms, munitions and war materials and related to traffic in other goods and materials;
(iv) relating to government procurement indispensable for national security or for national defence purposes;
(v) taken in time of war or other emergency in international relations; or
(c) to prevent any Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
Article 31. Progressive Liberalisation of Trade In Services and Establishment
As circumstances allow, including the situation arising from the accession of Iraq to the WTO, the Cooperation Council may make recommendations to the Parties to expand progressively trade in services and establishment between them and ensure full consistency with the provisions of the GATS, notably Article V. Where accepted, those recommendations could be put into effect by virtue of agreements between the Parties.
Section III. Provisions Affecting Business and Investment
Article 32. Encouragement of Investment
The Parties shall encourage an increase in mutually beneficial investment by establishing a more favourable climate for private investment.
Article 33. Contact Points and Exchange of Information
In order to facilitate the communication between the Parties on any trade matter related to private investment, each Party shall designate a contact point. On the request of either Party, the contact point of the other Party shall indicate the office or official responsible for the matter and provide the required support to facilitate communication with the requesting Party.
Section IV. Current Payments and Capital
Article 34. Objective and Scope
1. The Parties shall aim at the liberalisation of current payments and capital movements between them, in conformity with the commitments undertaken in the framework of the international financial institutions.
2. This Section applies to all current payments and capital movements between the Parties.
Article 35. Current Account
The Parties shall allow, in freely convertible currency and in accordance with the Articles of Agreement of the International Monetary Fund, any payments and transfers of the current account between the Parties.
Article 36. Capital Account
From the entry into force of the Agreement, the Parties shall allow the free movements of capital relating to direct investments made in accordance with the laws of the host country and investments made in accordance with the provisions of this Agreement, and the liquidation or repatriation of these capitals and of any profit stemming there from.
Article 37. Standstill
The Parties shall not introduce any new restrictions on current payments and movements of capital between their residents and shall not make the existing arrangements more restrictive.
Article 38. Safeguard Measures
1. Where, in exceptional circumstances, movements of capital between the Union and Iraq cause, or threaten to cause, serious difficulties for the operation of exchange rate policy or monetary policy in the Union or Iraq, the Union and Iraq, respectively, may take safeguard measures with regard to movements of capital between the Union and Iraq for a period not exceeding six months if such measures are strictly necessary.
2. The Party adopting the safeguard measures shall inform the other Party as soon as possible, of a time schedule for their removal.
Article 39. Final Provisions
1. Nothing in this Section shall limit the rights of economic operators of the Parties from benefiting from any more favourable treatment that may be provided for in any existing bilateral or multilateral agreement to which they are parties. 2
2. The Parties shall consult each other with a view to facilitating the movement of capital between them in order to promote the objectives of this Agreement
Section V. Trade-related Issues
Chapter I. State Trading Enterprises
Article 40.
1. The Parties aim to comply with the provisions of Article XVII of the GATT 1994, its Notes and Supplementary Provisions and the WTO Understanding on the Interpretation of Article XVII of the General Agreement on Tariffs and Trade 1994, which are incorporated into and made part of this Agreement, mutatis mutandis.
2. If one of the Parties requests information from the other Party on individual cases of state trading enterprises, the manner of their operation and the effect of their operations on bilateral trade, the requested Party shall ensure maximum transparency possible without prejudice to Article XVII.4(d) of the GATT 1994 on confidential information.
3. Each party shall ensure that any state trading enterprise supplier of a good or service shall comply with that Party's obligation under this Agreement.
Section II. Public Procurement
Article 41. Introduction
1. The Parties recognise the contribution of transparent, competitive and open tendering to sustainable economic development and set as their objective the effective, reciprocal and gradual opening of their respective procurement markets.
2. For the purposes of this Chapter:
(a) "commercial goods or services" means goods or services of a type generally sold or offered for sale in the commercial marketplace to, and customarily purchased by, non-governmental buyers for non-governmental purposes;
(b) "construction service" means a service that has as its objective the realization by whatever means of civil or building works, based on Division 51 of the United Nations Provisional Central Product Classification (hereinafter referred to as the "CPC");
(c) "days" means calendar days;
(d) "electronic auction" means an iterative process that involves the use of electronic means for the presentation by suppliers of either new prices, or new values for quantifiable non-price elements of the tender related to the evaluation criteria, or both, resulting in a ranking or re-ranking of tenders;
(e) "in writing or written" means any worded or numbered expression that can be read, reproduced and later communicated. It may include electronically transmitted and stored information;
(f) "limited tendering" means a procurement method whereby the procuring entity contacts a supplier or suppliers of its choice;
(g) "measure" means any law, regulation, procedure, administrative guidance or practice, or any action of a procuring entity relating to a covered procurement;
(h) "multi-use list" means a list of suppliers that a procuring entity has determined satisfy the conditions for participation in that list, and that the procuring entity intends to use more than once; (i)
(i) "notice of intended procurement" means a notice published by a procuring entity inviting interested suppliers to submit a request for participation, a tender, or both;
(j) "offset" means any condition or undertaking that encourages local development or improves a Party's balance-of-payments accounts, such as the use of domestic content, the licensing of technology, investment, counter-trade and similar action or requirement;
(k) "open tendering" means a procurement method whereby all interested suppliers may submit a tender;
(l) "person" means a natural person or a juridical person;