(b) voluntary arrangements between conformity assessment bodies in each Party's territory;
(c) use of accreditation based on international standards, to qualify conformity assessment bodies;
(d) government designation of conformity assessment bodies;
(e) recognition by a Party of the results of conformity assessments performed in the territory of another Party;
(f) use of regional or international arrangements and regional or international recognition agreements to which the Parties are parties; and
(g) the importing Party?s acceptance of a supplier?s declaration of conformity, based on international standards.
2. No Party shall prepare, adopt or apply conformity assessment procedures which are likely to create unnecessary obstacles to trade and shall to this end:
(a) reinforce the role of international standards as a basis for technical regulations, including conformity assessment procedures;
(b) promote the accreditation of conformity assessment bodies on the basis of the relevant Standards and Guidelines of the ISO and the IEC; and
(c) encourage the mutual acceptance of conformity assessment results of bodies accredited in accordance with subparagraph (b), which have been recognised under the relevant international agreement.
3. If a Party requires a positive assurance of conformity with domestic technical regulations, it should consider the acceptance of supplier?s declarations of conformity, based on international standards.
Article 4.7. Cooperation
With a view to increasing the mutual understanding of their respective systems and facilitating access to respective markets, the Parties shall strengthen their cooperation, in particular in the following areas:
(a) activities of international standardisation bodies and the WTO Committee on Technical Barriers to Trade;
(b) communication between each other?s competent authorities, exchange of information in respect of technical regulations, good regulatory practice, standards, conformity assessment procedures, border control and market surveillance; and
(c) encouraging their respective standardisation, accreditation and metrology bodies to cooperate, taking into account cooperation activities in relevant international fora.
Article 4.8. Consultations
Consultations shall be held at the request of a Party which considers that another Party has taken a measure which is likely to create, or has created, an obstacle to trade.
Such consultations shall take place within 40 days from the date of receipt of the request.
They may be conducted by any agreed method on a case-by-case basis with the objective of finding mutually acceptable solutions. (3)
Article 4.9. Annexes
The Parties have concluded Annexes IX-XII (Electrical and Electronic Products, Good Laboratory Practice, Good Manufacturing Practice, Marking and Labelling) to this Agreement to prevent, eliminate, or reduce unnecessary non-tariff barriers to trade, including to avoid duplicative and unnecessarily burdensome conformity assessment procedures in specific good sectors. The Parties may conclude further Annexes and side agreements in the future.
Article 4.10. Review Clause
The Parties shall consider extending to each other equivalent treatment related to technical regulations, standards and conformity assessment procedures granted by each Party to the European Union (EU), three years after the date of entry into force of this Agreement and thereafter, upon request by a Party. Such treatment may take the form of a sector specific arrangement. This provision exclusively concerns the trade relations between the Parties and does not lead to any obligations towards the EU.
Article 4.11. Contact Points
The Parties shall exchange names and addresses of contact points for this Chapter in order to facilitate communication and the exchange of information.
Chapter 5. SANITARY AND PHYTOSANITARY MEASURES
Article 5.1. Objectives
The objectives of this Chapter are to:
(a) further the implementation of the WTO Agreement on Sanitary and Phytosanitary Agreement (SPS Agreement);
(b) facilitate trade in food, animals and plants, including their goods, while protecting human, animal or plant life or health in the territory of each Party;
(c) deepen mutual understanding of each Party?s regulations and procedures relating to sanitary and phytosanitary measures;
(d) address, with a view to solve, trade concerns affecting bilateral trade within the scope of this Chapter; and
(e) strengthen communication, consultation and cooperation between the Parties on sanitary and phytosanitary measures.
Article 5.2. Scope and Coverage
This Chapter applies to sanitary and phytosanitary measures which may, directly or indirectly, affect trade between the Parties.
Article 5.3. Affirmation and Incorporation of the SPS Agreement
1. The Parties affirm their existing rights and obligations with respect to each other under the SPS Agreement.
2. For the purposes of this Chapter, the SPS Agreement applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 5.4. Definitions
For the purposes of this Chapter, "international standards" means the standards, guidelines and recommendations defined in paragraph 3 of Annex A of the SPS Agreement. (4)
Article 5.5. Audits
1. An importing Party shall base its audits of the exporting Party on international standards, guidelines and recommendations.
2. System audits shall be the preferred assessment method. The system audit may include the on-site inspections of facilities.
3. The costs incurred by the auditing Party shall be borne by the importing Party, unless both Parties decide otherwise.
4. The importing Party shall provide information in writing to the exporting Party within 90 days after the audit. The exporting Party may comment on such information within 30 days from the date of receipt. These comments shall be included in the assessment report.
Article 5.6. Certificates
1. The Parties agree to cooperate in order to minimise the number of sanitary and phytosanitary certificates as far as possible. Where such certificates are required, they should be in line with international standards, guidelines and recommendations and shall be made available in English.
2. Notwithstanding the Party?s existing rights and obligations in relation to the notification under the SPS Agreement, the notifying Party shall, upon request, provide supplementary rationale to the exporting Party with regard to the new or modified certificate. The exporting Party shall be given a reasonable period of time to adapt to the new requirements.
Article 5.7. Cooperation
1. The Parties shall:
(a) strengthen their cooperation with a view to increasing the mutual understanding of their respective systems and facilitating access to respective markets. Such cooperation includes, but is not limited to, collaboration between the relevant institutions that provides the Parties with scientific advice and risk analysis; and
(b) explore opportunities for further cooperation, collaboration and information exchange with the other Party on sanitary and phytosanitary matters of mutual interest consistent with the objectives of this Chapter.
2. Consistent with Article 5.1 (Objectives), each Party agrees to further explore and strengthen technical cooperation as set out in Chapter 13 (Cooperation and Capacity Building).
3. The Parties shall ensure that all adopted sanitary and phytosanitary regulations are published and available on the internet. Upon request, a Party shall provide supplementary information regarding import requirements in English.
4. Notwithstanding the Party's existing rights and obligations in relation to the notification under the SPS Agreement, the notifying Party, upon request, when introducing new sanitary and phytosanitary measures, will provide supplementary justifications for the measure.
Article 5.8. Movement of Goods
1. An importing Party shall ensure free movement of goods complying with its relevant sanitary and phytosanitary requirements with no less favourable treatment than that accorded to domestic goods once placed on its market.
2. Notwithstanding paragraph 1 above, the movement of goods in Malaysia is subject to the relevant domestic laws and regulations applicable to Peninsular Malaysia, Sabah and Sarawak.
Article 5.9. Import Checks
1. The import requirements and checks applied to imported goods including live animals shall be based on the risk that is associated with such goods and shall be applied in a non-discriminatory manner. Import checks shall be carried out without undue delay, in a manner that is no more trade-restrictive than necessary.
2. Information about the frequency of import checks or changes in this frequency shall be exchanged on request between competent authorities.
3. Import checks should be in accordance with international standards, guidelines and recommendations.
4. Each Party shall ensure that the clearance process for goods not subject to random and routine checks are undertaken without undue delay. Goods subject to random and routine checks should not be detained pending test results.
5. The importing Party shall notify the importer or its representative or the competent authority of the exporting Party or the embassy if the competent authority is not known of a non-compliant consignment including the reason for non-compliance and provide them with an opportunity to appeal the decision.
6. If a good is detained at the border due to a perceived risk, the necessary investigations as well as decision on clearance shall be undertaken as soon as possible to avoid any delays, in particular to prevent the deterioration of perishable goods.
7. When a Party detains, at a port of entry, goods exported from another Party due to non-conformity with a sanitary or phytosanitary measure, the reasons for the detention shall be promptly notified to the importer or his or her representative.
8. If goods are rejected at a port of entry, each Party shall ensure that the importer or his or her representative may appeal the decision.
9. When goods are rejected at a port of entry due to a serious sanitary or phytosanitary non-conformity, the competent authority in the exporting Party shall be informed as soon as possible.
Article 5.10. Consultations
If a Party has concerns regarding any matter arising under this Chapter with another Party, the Party may request consultations to address the matter. Such consultations shall take place, without undue delay, using any agreed method, with a view of finding mutually acceptable solutions. The Parties shall endeavour to resolve the matter and may inform the Joint Committee thereof.
Article 5.11. Competent Authorities and Contact Points
1. The Parties shall exchange information on competent authorities and contact details of contact points for this Chapter in order to facilitate communication and the exchange of information.
2. In the event of changes in this information, the Parties shall notify each other.
Chapter 6. TRADE REMEDIES
Article 6.1. Subsidies and Countervailing Measures
1. The rights and obligations of the Parties relating to subsidies and countervailing measures shall be governed by Articles VI and XVI of the GATT 1994 and the WTO Agreement on Subsidies and Countervailing Measures, except as provided for in paragraph 2.
2. Before a Party initiates an investigation to determine the existence, degree and effect of any alleged subsidy in another Party, as provided for in Article 11 of the WTO Agreement on Subsidies and Countervailing Measures, the Party considering initiating an investigation shall notify in writing the Party whose goods are subject to investigation and allow for a 25-day period with a view to finding a mutually acceptable solution. The consultations shall take place within 15 days from the receipt of the notification.
The consultations may take place in the Joint Committee, unless the Parties making and receiving the notification agree otherwise.
Article 6.2. Anti-Dumping
1. The rights and obligations of a Party relating to anti-dumping measures shall be governed by Article VI of the GATT 1994 and the WTO Agreement on Implementation of Article VI of the GATT 1994 (the WTO Anti-Dumping Agreement), subject to paragraphs 2 to 6. The Parties will endeavour to refrain from initiating anti-dumping procedures against each other.
2. When a Party receives a properly documented application and before initiating an investigation under the WTO Anti-Dumping Agreement, the Party shall, as soon as possible, notify in writing the other Party whose goods are allegedly being dumped and allow for consultations throughout the investigation with a view to finding a mutually acceptable solution.
The consultations shall take place in the Joint Committee, unless the Parties making and receiving the notification agree otherwise.
3. A Party shall not initiate an anti-dumping investigation with regard to the same good from the same Party within 12 months of a determination which resulted in the non-application or revocation of anti-dumping measures or from the termination of a measure.
4. If a Party decides to impose an anti-dumping duty, the Party shall apply a duty less than the margin of dumping, if such lesser duty would be adequate to remove the injury to the domestic industry.
5. When anti-dumping margins are established, assessed or reviewed under Article 2, paragraph 9.3 and paragraph 9.5 of Article 9 and Article 11 of the WTO Anti-Dumping Agreement, regardless of the comparison bases under subparagraph 2.4.2 of Article 2 of the WTO Anti-Dumping Agreement, all individual margins, whether positive or negative, shall be counted toward the average.
6. Five years from the date of entry into force of this Agreement, the Parties shall, in the Joint Committee, review whether there is a need to maintain the possibility to take anti-dumping measures between them. If the Parties decide after the first review to maintain this possibility, biennial reviews shall thereafter be conducted in the Joint Committee.
Article 6.3. Global Safeguard Measures
1. The rights and obligations of the Parties in respect of global safeguards shall be governed by Article XIX of the GATT 1994 and the WTO Agreement on Safeguards, except as provided for in paragraph 2.
2. In taking measures under Article XIX of the GATT 1994 and the WTO Agreement on Safeguards, a Party shall, consistent with its obligations under the WTO Agreements, exclude imports of an originating good from a Party if such imports do not cause or threaten to cause injury, in particular if the share of imports of that Party does not exceed three percent of the total imports of the good concerned.
Article 6.4. Bilateral Safeguard Measures
1. Where during the transition period, as a result of the reduction or elimination of a customs duty under this Agreement, any good originating in a Party is imported into the territory of another Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to cause or threaten to cause serious injury to the domestic industry of like or directly competitive goods in the territory of the importing Party, the importing Party may take bilateral safeguard measures to the minimum extent necessary to remedy or prevent the serious injury and facilitate adjustment, subject to paragraphs 2 to 12.
2. If the conditions set out in paragraph 1 are met, the importing Party may:
(a) suspend the further reduction of any rate of customs duty provided for under this Agreement for the good; or
(b) increase the rate of customs duty for the good to a level not to exceed the lesser of:
(i) the MFN rate of duty applied at the time the bilateral safeguard measure is taken; or
(ii) the MFN rate of duty applied on the day immediately preceding the date of entry into force of this Agreement.
3. Bilateral safeguard measures shall only be taken upon clear evidence that increased imports have caused or are threatening to cause serious injury pursuant to an investigation in accordance with the procedures laid down in the WTO Agreement on Safeguards, in particular Articles 3 and 4 thereof.
4. Bilateral safeguard measures may be taken during the transition period, which shall be a period of five years beginning on the date of entry into force of this Agreement. In the case of a good subject to tariff dismantling as set out in Annexes III-VI (Reduction or Elimination of Customs Duties and Schedules of tariff commitments agriculture from the EFTA States) that lasts five or more years, the transition period shall be extended to the end of the tariff dismantling period for that product. Bilateral safeguard measures shall be taken for a period not exceeding two years. In very exceptional circumstances, measures may be taken up to a total maximum period of three years. No bilateral safeguard measures shall be applied to the import of a good which has previously been subject to such a measure.
5. No Party may apply, with respect to the same good, at the same time, a measure in accordance with:
(a) this Article;
(b) Article XIX of GATT 1994 and the WTO Safeguards Agreement; and
(c) Article 5 of the WTO Agreement on Agriculture.
6. A Party intending to apply or extend a bilateral safeguard measure shall offer to the Party which may be affected by the bilateral safeguard measure compensation in the form of concessions having substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the bilateral safeguard measure.
7. The Party intending to apply or extend a bilateral safeguard measure pursuant to this Article shall immediately, and in any case before taking or extending a measure, notify the other Parties. The notification shall contain all pertinent information, including evidence of serious injury or threat thereof caused by increased imports, a precise description of the good concerned, and the proposed measure, as well as the proposed date of introduction, expected duration and timetable for the progressive removal of the measure and the offered compensation. In the case of an extension of a bilateral safeguard measure, evidence that the domestic industry concerned is adjusting shall also be provided. Upon request of a Party affected by the bilateral safeguard measure, the Party applying or extending the bilateral safeguard measure shall to the extent possible provide additional information.
8. Upon request of a Party, the Joint Committee shall, within 30 days from the date of receipt of the notification, examine the information provided under paragraph 7 in order to facilitate a mutually acceptable solution. In the absence of such solution, the importing Party may adopt a bilateral safeguard measure pursuant to paragraph 2 to remedy the problem and, in the absence of mutually agreed trade compensation, the Party against whose good the bilateral safeguard measure is taken may take compensatory action by suspending the application of substantially equivalent concessions to the Party applying the bilateral safeguard measure.
The application of a bilateral safeguard measure and compensatory action shall be notified to the other Parties at least 30 days in advance.
In the selection of the bilateral safeguard measure and the compensatory action, priority must be given to the action or measure which least disturbs the functioning of this Agreement. A Party shall take compensatory action only for the minimum period necessary to achieve the substantially equivalent trade effects and in any event, only while the bilateral safeguard measure under paragraph 2 is being applied.
9. Regardless of its duration or whether it has been subject to extension, a bilateral safeguard measure on a good shall be terminated at the end of the transition period.
10. Upon the termination of the bilateral safeguard measure, the rate of customs duty shall be the rate which would have been in effect but for the measure.
11. In critical circumstances, where delay would cause damage which would be difficult to repair, a Party may take a provisional bilateral safeguard measure pursuant to a preliminary determination that there is clear evidence that increased imports as a result of the reduction or elimination of a customs duty under this Agreement have caused or threaten to cause serious injury to the domestic industry. The Party intending to take such a measure shall immediately notify the other Parties thereof. The procedures set out in in this Article shall be initiated within 30 days from the date of receipt of the notification. Any compensation shall be based on the total period of application of the provisional bilateral safeguard measure and of the bilateral safeguard measure.
12. Any provisional bilateral safeguard measure shall be terminated within 200 days at the latest. The period of application of any such provisional bilateral safeguard measure shall be counted as part of the duration, and any extension thereof, of the bilateral safeguard measure, set out in paragraphs 2 and 4 respectively. Any tariff increases shall be promptly refunded if the investigation described in paragraph 3 does not result in a finding that the conditions of paragraph 1 are met.
Chapter 7. TRADE IN SERVICES
Article 7.1. Scope and Coverage
1. This Chapter applies to measures by a Party affecting trade in services.
2. For the purposes of this Chapter, measures by a Party means measures taken by:
(a) central, regional, or local governments and authorities;
(b) non-governmental bodies in the exercise of powers delegated by central, regional, or local governments or authorities.
3. This Chapter shall not apply to:
(a) government procurement;
(b) subsidies or grants, including government-supported loans, guarantees, and insurance, provided by a Party or to any conditions attached to the receipt or continued receipt of such subsidies or grants, whether or not such subsidies or grants are offered exclusively to domestic services, service consumers, or service suppliers;
(c) services supplied in the exercise of governmental authority;
(d) in respect of air transport services, measures affecting traffic rights however granted, or measures affecting services directly related to the exercise of traffic rights, other than measures affecting:
(i) aircraft repair and maintenance services;
(ii) the selling and marketing of air transport services;
(iii) computer reservation system (CRS) services;
(iv) airport operation services; and
(v) ground handling services.
Article 7.2. Definitions
1. For the purposes of this Chapter:
(a) "trade in services" means the supply of a service:
(i) from the territory of a Party into the territory of another Party;
(ii) in the territory of a Party to the service consumer of another Party;
(iii) by a service supplier of a Party, through commercial presence in the territory of another Party;
(iv) by a service supplier of a Party, through presence of natural persons of a Party in the territory of another Party;
(b) "services" includes any service in any sector except services supplied in the exercise of governmental authority;
(c) "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;
(d) "measure" means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;
(e) "supply of a service" includes the production, distribution, marketing, sale and delivery of a service;
(f) "measures by Parties affecting trade in services" includes measures with respect to:
(i) the purchase, payment or use of a service;
(ii) the access to and use of, in connection with the supply of a service, services which are required by those Parties to be offered to the public generally;
(iii) the presence, including commercial presence, of persons of a Party for the supply of a service in the territory of another Party;
(g) "commercial presence" means any type of business or professional establishment, including through:
(i) the constitution, acquisition or maintenance of a juridical person; or
(ii) the creation or maintenance of a branch or a representative office;
within the territory of a Party for the purpose of supplying a service;
(h) "sector of a service" means: