Title
ECONOMIC PARTNERSHIP AGREEMENT BETWEEN THE EFTA STATES AND MALAYSIA
Preamble
PREAMBLE
Iceland, the Principality of Liechtenstein, the Kingdom of Norway and the Swiss Confederation (European Free Trade Association (EFTA) States),
and
Malaysia,
(hereinafter each individually referred to as a "Party" or collectively as the "Parties"),
RECOGNISING the common wish to strengthen the links between the EFTA States and Malaysia by establishing close and lasting trade relations through this Economic Partnership Agreement (Agreement);
REAFFIRMING their commitment to democracy, the rule of law, human rights and fundamental freedoms in accordance with each Party?s respective obligations under international law, including as set out in the United Nations Charter and the Universal Declaration of Human Rights;
DESIRING to create favourable conditions for the development and diversification of trade between them and for the promotion of commercial and economic cooperation in areas of common interest on the basis of mutual benefit, non-discrimination and international law;
RECOGNISING the importance of trade facilitation in promoting efficient and transparent procedures to reduce costs and to ensure predictability for the trading communities of the Parties;
DETERMINED to promote and further strengthen the multilateral trading system, building on their respective rights and obligations under the Marrakesh Agreement establishing the World Trade Organisation (WTO Agreement) and other agreements negotiated thereunder, thereby contributing to the harmonious development and expansion of world trade;
REAFFIRMING their commitment to promote the development of international trade in such a way as to contribute to the objective of sustainable development;
RECOGNISING the importance of coherence and mutual supportiveness of trade, environment and labour policies;
REAFFIRMING their commitment to protect and enforce labour rights, improve working conditions and living standards, strengthen cooperation and the Parties? capacity on labour issues;
RECALLING their rights and obligations under multilateral environmental agreements to which they are a party, and the respect for the fundamental principles and rights at work, including the principles set out in the relevant International Labour Organisation (ILO) Conventions to which they are a party;
AIMING to create new employment opportunities, improve living standards and raise the levels of protection of health, safety and the environment;
DETERMINED to implement this Agreement in line with the objectives to preserve and protect the environment through sound environmental management that has been enumerated under the UN 2030 Agenda for Sustainable Development;
AFFIRMING their determination to prevent and combat corruption in international trade and investment and to promote the principles of transparency and good public governance;
ACKNOWLEDGING the importance of good corporate governance and corporate social responsibility for sustainable development, and affirming their aim to encourage enterprises to observe internationally recognised guidelines and principles in this respect, such as the OECD Guidelines for Multinational Enterprises and the UN Global Compact;
CONVINCED that this Agreement will enhance the competitiveness of their enterprises in global markets and create conditions encouraging economic, trade and investment relations between them;
HAVE AGREED, in pursuit of the above, to conclude the following Agreement:
Body
Chapter 1. GENERAL PROVISIONS
Article 1.1. Objectives
1. The EFTA States and Malaysia hereby establish a free trade area in accordance with the provisions of this Agreement, which is based on trade relations between market economies.
2. The objectives of this Agreement are:
(a) to achieve the liberalisation of trade in goods, in conformity with Article XXIV of the General Agreement on Tariffs and Trade (GATT 1994);
(b) to achieve the liberalisation of trade in services, in conformity with Article V of the General Agreement on Trade in Services (GATS);
(c) to mutually enhance investment opportunities;
(d) to promote competition in their economies, particularly as it relates to economic relations between the Parties;
(e) to achieve liberalisation on a mutual basis of the government procurement markets of the Parties;
(f) to ensure adequate, effective protection and enforcement of intellectual property rights;
(g) to develop international trade in such a way as to contribute to the objective of sustainable development and to ensure that this objective is integrated and reflected in the Parties? trade relationship; and
(h) thereby to contribute to the harmonious development and expansion of world trade.
Article 1.2. Scope of Application
1. Except as otherwise specified in Annex I (Rules of Origin and Administrative Cooperation), this Agreement shall apply:
(a) to the land territory, internal waters and the territorial sea of a Party, and the air-space above the territory of a Party, in accordance with domestic and international law; and
(b) beyond the territorial sea, with respect to measures taken by a Party in the exercise of its sovereign rights or jurisdiction in accordance with domestic and international law.
2. This Agreement shall not apply to the Norwegian territory of Svalbard, with the exception of trade in goods.
Article 1.3. Trade Relations Governed by this Agreement
1. This Agreement shall apply to the trade relations between, on the one side, the individual EFTA States and, on the other side, Malaysia, but not to the trade relations between individual EFTA States, unless otherwise provided for in this Agreement.
2. As a result of the customs union established by the Customs Treaty of 29 March 1923 between Switzerland and Liechtenstein, Switzerland shall represent Liechtenstein in matters covered thereby.
Article 1.4. Relationship to other International Agreements
1. The Parties confirm their rights and obligations under the WTO Agreement and other agreements negotiated thereunder to which they are a party, and any other international agreements to which they are a party.
2. If a Party considers that the maintenance or establishment of customs unions, free trade areas, arrangements for frontier trade or other preferential agreements by another Party has the effect of altering the trade regime provided for by this Agreement, it may request consultations. The Party concluding such agreement shall afford adequate opportunity for consultations with the requesting Party with a view to reaching a mutually satisfactory solution.
Article 1.5. Central, Regional and Local Government
The Parties shall take any general or specific measures required to fulfil their obligations under this Agreement. Subject to the provisions of this Agreement, each Party shall ensure within its territory the observance of all obligations and commitments under this Agreement by its respective central, regional and local governments and authorities, and by non-governmental bodies in the exercise of governmental powers delegated to them by central, regional and local governments or authorities.
Article 1.6. Transparency and Confidentiality
1. Each Party shall publish or otherwise make publicly available, their laws, regulations, judicial decisions and administrative rulings of general application as well as their respective international agreements that may affect the operation of this Agreement.
2. Each Party shall promptly respond to specific questions and provide, upon request, information to another Party on matters referred to in paragraph 1.
3. Nothing in this Agreement shall require any Party to disclose confidential information that would impede law enforcement or otherwise be contrary to the public interest or that would prejudice the legitimate commercial interests of particular enterprises, public or private. Where a Party provides information to another Party in accordance with this Agreement and designates the information as confidential, that Party shall maintain the confidentiality of the information.
4. In case of any inconsistency between this Article and provisions relating to transparency in other parts of this Agreement, the latter shall prevail to the extent of the inconsistency.
Chapter 2. TRADE IN NON-AGRICULTURAL GOODS
Article 2.1. Scope
This Chapter applies to trade between the Parties relating to goods as set out in Annex II (Product Coverage of Non-Agricultural Goods).
Article 2.2. Definitions
For the purpose of this Agreement:
(a) "originating goods" means the goods that qualify as originating goods in accordance with Annex I (Rules of Origin and Administrative Cooperation);
(b) "goods" includes manufactured goods and commodities in their raw, semi-processed and processed forms;
(c) "import duties" means any duty or charge of any kind imposed in connection with the importation of goods, including any form of surtax or surcharge, but does not include any:
(i) charges equivalent to an internal tax imposed consistently with Article III of GATT 1994;
(ii) fees or other charges in connection with the importation commensurate with the cost of services rendered in accordance with Article VIII of GATT 1994; and
(iii) anti-dumping, countervailing duties or safeguard duties which are applied in accordance with Chapter 6 (Trade Remedies).
Article 2.3. Import Duties
1. Upon entry into force of this Agreement, Malaysia shall abolish or reduce its import duties on goods originating in an EFTA State covered by Article 2.1 (Scope), in accordance with the terms and conditions set out in Annex III (Reduction or Elimination of Import Duties).
2. Upon entry into force of this Agreement, the EFTA States shall abolish all import duties on goods originating in Malaysia covered by Article 2.1 (Scope).
3. No Party may increase an existing import duty nor introduce a new import duty on originating goods of another Party.
Article 2.4. Customs Valuation (1)
For the purpose of determining the customs value of goods traded between the Parties, Article VII of the GATT 1994 and Part I of the Agreement on Implementation of Article VII of the GATT 1994 apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.5. Quantitative Restrictions
1. With respect to the rights and obligations of the Parties concerning quantitative restrictions, Article XI of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
2. A Party introducing a measure in accordance with paragraph 2 of Article XI of the GATT 1994 shall promptly notify the Joint Committee. A notification by a Party in accordance with Article XI of the GATT 1994 shall be deemed equivalent to a notification under this Agreement.
3. Any measure applied in accordance with this Article shall be of limited duration, non-discriminatory, transparent and may not go beyond what is necessary to remedy circumstances described in paragraph 2 of Article XI of the GATT 1994 and may not create unnecessary obstacles to trade between the Parties.
Article 2.6. Rules of Origin and Methods of Administrative Cooperation
The rules of origin and administrative cooperation are set out in Annex I (Rules of Origin and Administrative Cooperation).
Article 2.7. Classification of Goods
The classification of goods shall be in conformity with the Harmonized Commodity Description and Coding System (Harmonized System or HS).
Article 2.8. Fees and Formalities
Article VIII of the GATT 1994 applies, and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.9. National Treatment on Internal Taxation and Regulations
Each Party shall accord national treatment to the goods of another Party in accordance with Article III of the GATT 1994, which applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.10. Technical Amendments
1. The Parties shall, following the periodic amendments to the HS by the World Customs Organization (WCO), transpose its Annex III (Reduction or Elimination of Customs Duties), Annexes IV-VI (Schedules of Tariff Commitments on Agriculture from the EFTA States) and Appendix 1 (Product Specific Rules (PSR)) to Annex I (Rules of Origin and Administrative Cooperation) accordingly.
2. The transposition of the Schedules of Tariff Commitments and the PSR as a result of periodic amendments to the HS by the WCO or other technical adjustments in the respective tariff nomenclature shall not impair commitments listed in the Annex III (Reduction or Elimination of Customs Duties), Annexes IV-VI (Schedules of Tariff Commitments Agriculture from the EFTA States) and Appendix 1 (PSR) to Annex I (Rules of Origin and Administrative Cooperation).
3. Upon request of one or several Parties and within a reasonable period of time after receiving the request, the requested Party shall address any concerns raised regarding the transposed tariff commitments or PSR under this Agreement.
4. In the Schedules of Tariff Commitments and the PSR according to paragraph 1, the version of the HS and the year shall be indicated.
Article 2.11. Exchange of Trade Data
1. The Parties recognise the value of trade data in the accurate analysis of the utilisation and the impact of this Agreement on trade between the Parties. The Parties shall annually exchange data on the most-favoured-nation (MFN) tariff rates, preferential tariff rates under this Agreement and import statistics (preferential and MFN) between them.
2. Import statistics shall pertain to the most recent calendar year available. If there has been a revision in the previously submitted data pertaining to the three most recent calendar years, a revised version of the data shall be submitted. The preferential tariff rates and applied MFN tariff rates exchanged shall pertain to the same year as the import statistics. Upon request, the Parties may exchange additional information and explanations.
3. Subject to the availability of data, the exchange of import statistics and tariff rates shall start in the year following the first full calendar year the Agreement was in force. The Parties shall exchange all relevant data no later than three years from the date of the entry into force of this Agreement.
4. Each Party shall establish a designated contact point. The contact points, shall, as appropriate, jointly determine the details concerning the nature and format of data to be exchanged.
5. Each Party shall give consideration to a request from another Party for technical cooperation with regard to exchange of data under paragraph 1 and 2.
6. Notwithstanding paragraphs 1 and 2, no Party shall be obliged to exchange data which is confidential in accordance with its domestic laws and regulations.
7. The Parties shall exchange information in English.
Article 2.12. Sub-Committee on Trade In Goods
1. A Sub-Committee on Trade in Goods (Sub-Committee) under the Joint Committee, comprising representatives of each Party, is hereby established.
2. The functions of the Sub-Committee are set out in Annex VII (Functions of the Sub-Committee on Trade in Goods).
Article 2.13. State Trading Enterprises
With respect to the rights and obligations of the Parties concerning state trading enterprises, Article XVII of the GATT 1994 and the Understanding on the Interpretation of Article XVII of the GATT 1994 apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.14. Balance-of-Payments
1. A Party in serious balance-of-payments difficulties, or under imminent threat thereof, may, in accordance with the conditions established under the GATT 1994 and the WTO Understanding on the Balance-of-Payments Provisions of the GATT 1994, adopt trade restrictive measures, which shall be of limited duration and non-discriminatory, and may not go beyond what is necessary to remedy the balance-of-payments situation.
2. A Party introducing a measure under this Article shall promptly notify the other Parties thereof.
Article 2.15. Trade Facilitation
The provisions on trade facilitation are laid out in Annex VIII (Customs Procedures and Trade Facilitation).
Article 2.16. General Exceptions
For the purposes of this Chapter, Article XX of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.17. Security Exceptions
For the purposes of this Chapter, Article XXI of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Chapter 3. TRADE IN AGRICULTURAL GOODS
Article 3.1. Scope
This Chapter applies to trade between the Parties relating to goods other than those covered in Annex II (Product Coverage of Non-Agricultural Goods).
Article 3.2. Tariff Concessions
1. Malaysia shall grant tariff concessions on agricultural goods originating in an EFTA State as specified in Annex III (Reduction or Elimination of Customs Duties).
2. Each EFTA State shall grant tariff concessions on agricultural goods originating in Malaysia as specified in Annexes IV-VI (Schedule of tariff commitments agriculture from the EFTA States).
Article 3.3. Other Provisions
1. With regard to trade in agricultural goods referred to in this Chapter, the following provisions apply, mutatis mutandis: Articles 2.2 (Definitions), 2.4 (Customs Valuation), 2.5 (Quantitative Restrictions), 2.6 (Rules of Origin and Methods of Administrative Cooperation), 2.7 (Classifications of Goods), 2.8 (Fees and Formalities), 2.9 (National Treatment on Internal Taxation and Regulations), 2.10 (Technical Amendments), 2.11 (Exchange of Trade Data), 2.12 (Sub-Committee on Trade in Goods), 2.13 (State Trading Enterprises), 2.14 (Balance-of-Payments), 2.15 (Trade Facilitation), 2.16 (General Exceptions), 2.17 (Security Exceptions), Chapter 4 (Technical Barriers to Trade), Chapter 5 (Sanitary and Phytosanitary Measures) and Chapter 6 (Trade Remedies).
2. With regard to Article 2.6 (Rules of Origin and Methods of Administrative Cooperation), only bilateral accumulation between the individual Parties shall be allowed for goods covered by this Chapter.
Article 3.4. Dialogue
The Parties shall examine any difficulties that might arise in their trade in agricultural goods and shall endeavour to seek appropriate solutions through dialogue and consultations.
Article 3.5. Further Liberalisation
The Parties undertake to continue their efforts with a view to achieving further liberalisation of their trade in agricultural goods, taking into account the arrangements for processed agricultural goods, the pattern of trade in agricultural goods between the Parties, the particular sensitivities of such goods, the development of each Party's agricultural policy and developments in bilateral and multilateral fora.
With a view to achieving this objective, the Parties may consult in conjunction with the Joint Committee meetings.
Chapter 4. TECHNICAL BARRIERS TO TRADE
Article 4.1. Objectives
1. The objectives of this Chapter are to:
(a) further the implementation of the WTO Agreement on Technical Barriers to Trade (TBT Agreement);
(b) facilitate bilateral trade and access to respective markets for goods falling within the scope of this Chapter;
(c) facilitate information exchange and cooperation in the field of technical regulations, standards and conformity assessment between the Parties, and enhance mutual understanding of each Party's regulatory system;
(d) eliminate, reduce or prevent unnecessary obstacles to trade between the Parties, in particular to avoid duplications in conformity assessment procedures; and
(e) address, with a view to solve, trade concerns affecting bilateral trade within the scope of this Chapter.
Article 4.2. Scope
1. This Chapter shall apply to the preparation, adoption and application of all standards, technical regulations and conformity assessment procedures which may affect trade in goods between the Parties, irrespective of their origin.
2. Notwithstanding paragraph 1, this Chapter shall not apply to:
(a) sanitary and phytosanitary measures covered by Chapter 5 (Sanitary and Phytosanitary Measures); and
(b) purchasing specifications prepared by governmental bodies for production or consumption requirements of governmental bodies.
Article 4.3. Incorporation of the TBT Agreement
Except as otherwise provided for in this Chapter, with respect to technical regulations, standards and conformity assessments, the TBT Agreement applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 4.4. International Standards
For the purposes of this Chapter, standards issued by international standardising bodies, in particular, but not limited to the International Organization for Standardization (ISO), International Electrotechnical Commission (IEC), the International Telecommunication Union (ITU) and Codex Alimentarius shall be considered relevant international standards in the sense of Article 2.4 of the TBT Agreement.
Article 4.5. Movement of Goods, Border Control and Market Surveillance
1. The Parties shall ensure that goods fully complying with the relevant technical regulations of the importing Party can move within their respective territories, once placed on the market. (2)
2. Where a Party detains, at a port of entry, goods imported from another Party, the reasons for the detention shall be notified without undue delay to the importer or his or her representative.
3. Where a Party withdraws from its market goods imported from another Party, the reasons shall be notified without undue delay to the importer, his or her representative or a person responsible for placing the goods on the market.
Article 4.6. Conformity Assessment Procedures
1. The Parties acknowledge that a broad range of mechanisms exist to facilitate the acceptance in a Party's territory of the results of conformity assessment procedures conducted in another Party's territory, including:
(a) agreements on mutual acceptance of the results of conformity assessment procedures with respect to specified technical regulations conducted by recognised conformity assessment bodies;