1. A Party may request consultations with the other Party regarding any matter arising under this Agreement that affects financial services. The other Party shall give sympathetic consideration to the request. The Parties shall report the results of their consultations to the Committee.
2. Consultations under this Article shall include officials of the authorities specified in Annex 11-B.
3. Nothing in this Article shall be construed to require regulatory authorities participating in consultations under paragraph 1 to disclose information or take any action that would interfere with specific regulatory, supervisory, administrative, or enforcement matters.
4. Nothing in this Article shall be construed to require a Party to derogate from its relevant law regarding sharing of information among financial regulators or the requirements of an agreement or arrangement between financial authorities of the Parties.
Article 11.18. DISPUTE SETTLEMENT
1. Section A (Dispute Settlement) of Chapter 22 (Dispute Settlement) shall apply as modified by this Article to the settlement of disputes arising under this Chapter.
2. When a Party claims that a dispute arises under this Chapter, Article 22.7 (Establishment of Panel) shall apply, except that:
(a) where the Parties so agree, the panel shall be composed entirely of panelists meeting the qualifications in paragraph 3; and
(b) in any other case,
(i) each Party may select panelists meeting the qualifications set out in paragraph 3 or in Article 22.7.12 (Establishment of a Panel); and
(ii) if the Party complained against invokes Article 11.10, the chair of the panel shall meet the qualifications set out in paragraph 3, unless the Parties otherwise agree.
3. Financial services panelists shall:
(a) have expertise or experience in financial services law or practice, which may include the regulation of financial institutions;
(b) be chosen strictly on the basis of objectivity, reliability, and sound judgment;
(c) be independent of, and not be affiliated with or take instructions from, a disputing Party; and
(d) comply with the code of conduct to be established by the Joint Committee.
4. Notwithstanding Article 22.13 (Non-Implementation and Suspension of Benefits), where a panel finds a measure to be inconsistent with this Agreement and the measure under dispute affects:
(a) only the financial services sector, the complaining Party may suspend benefits only in the financial services sector;
(b) the financial services sector and any other sector, the complaining Party may suspend benefits in the financial services sector that have an effect equivalent to the effect of the measure in the Party’s financial services sector; or
(c) only a sector other than the financial services sector, the complaining Party shall not suspend benefits in the financial services sector.
Article 11.19. INVESTMENT DISPUTES IN FINANCIAL SERVICES
1. Where an investor of a Party submits a claim under Section B (Investor-State Dispute Settlement) of Chapter 9 (Investment) against the other Party and the respondent invokes Article 11.10, on request of the respondent, the tribunal shall refer the matter in writing to the Committee for a decision. The tribunal may not proceed pending receipt of a decision or report under this Article.
2. In a referral pursuant to paragraph 1, the Committee shall decide the issue of whether and to what extent Article 11.10 is a valid defense to the claim of the investor. The Committee shall transmit a copy of its decision to the tribunal and to the Joint Committee. The decision shall be binding on the tribunal.
3. Where the Committee has not decided the issue within 60 days of the receipt of the referral under paragraph 1, the respondent or the Party of the claimant may request the establishment of an arbitral panel under Article 22.7 (Establishment of Panel). The panel shall be constituted in accordance with Article 11.18. The panel shall transmit its final report to the Committee and to the tribunal. The report shall be binding on the tribunal.
4. The Committee may decide that, for the purposes of a referral pursuant to paragraph 1, the financial services authorities of the relevant Parties shall make the decision described in paragraph 2 and transmit that decision to the tribunal and the Joint Committee. In that case, a request may be made under paragraph 3 if the relevant Parties have not made the decision described in paragraph 2 within 60 days of their receipt of the referral under paragraph 1.
5. Where no request for the establishment of a panel pursuant to paragraph 3 has been made within 10 days of the expiration of the 60-day period referred to in paragraph 3, the tribunal may proceed to decide the matter.
6. For the purposes of this Article, tribunal means a tribunal established under Article 9.20 (Selection of Arbitrators).
Article 11.20. DEFINITIONS
For the purposes of this Chapter:
cross-border financial service supplier of a Party means a person of a Party that is engaged in the business of supplying a financial service within the territory of the Party and that seeks to supply or supplies a financial service through the cross-border supply of such services;
cross-border trade in financial services or cross-border supply of financial services means the supply of a financial service:
(a) from the territory of a Party into the territory of the other Party;
(b) in the territory of a Party by a person of that Party to a person of the other Party; or
(c) by a national of a Party in the territory of the other Party, but does not include the supply of a financial service in the territory of a Party by an investment in that territory;
financial institution means any financial intermediary or other enterprise that is authorized to do business and regulated or supervised as a financial institution under the law of the Party in whose territory it is located;
financial institution of the other Party means a financial institution, including a branch, located in the territory of a Party that is controlled by persons of the other Party;
financial service means any service of a financial nature. Financial services include all insurance and insurance-related services, and all banking and other financial services (excluding insurance), as well as services incidental or auxiliary to a service of a financial nature. Financial services include the following activities:
Insurance and insurance-related services
(a) direct insurance (including co-insurance):
(i) life,
(ii) non-life;
(b) reinsurance and retrocession;
(c) insurance intermediation, such as brokerage and agency; and
(d) services auxiliary to insurance, such as consultancy, actuarial, risk assessment, and claim settlement services;
Banking and other financial services (excluding insurance)
(e) acceptance of deposits and other repayable funds from the public;
(f) lending of all types, including consumer credit, mortgage credit, factoring, and financing of commercial transactions;
(g) financial leasing;
(h) all payment and money transmission services, including credit, charge and debit cards, travelers checks, and bankers drafts;
(i) guarantees and commitments;
(j) trading for own account or for account of customers, whether on an exchange, in an over-the-counter market, or otherwise, the following:
(i) money market instruments (including checks, bills, certificates of deposits);
(ii) foreign exchange;
(iii) derivative products including, but not limited to, futures and options;
(iv) exchange rate and interest rate instruments, including products such as swaps, forward rate agreements;
(v) transferable securities;
(vi) other negotiable instruments and financial assets, including bullion;
(k) participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;
(l) money broking;
(m) asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository, and trust services;
(n) settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;
(o) provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services; and
(p) advisory, intermediation, and other auxiliary financial services on all the activities listed in subparagraphs (e) through (o), including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy;
financial service supplier of a Party means a person of a Party that is engaged in the business of supplying a financial service within the territory of that Party;
investment means “investment” as defined in Article 9.29 (Definitions), except that, with respect to “loans” and “debt instruments” referred to in that Article:
(a) a loan to or debt instrument issued by a financial institution is an investment only where it is treated as regulatory capital by the Party in whose territory the financial institution is located; and
(b) a loan granted by or debt instrument owned by a financial institution, other than a loan to or debt instrument issued by a financial institution referred to in subparagraph (a), is not an investment;
for greater certainty, a loan granted by or debt instrument owned by a cross-border financial service supplier, other than a loan to or debt instrument issued by a financial institution, is an investment for the purposes of Chapter 9 (Investment), if such loan or debt instrument meets the criteria for investments set out in Article 9.29 (Definitions);
investor of a Party means a Party or state enterprise thereof, or a person of a Party, that attempts to make, is making, or has made an investment in the territory of the other Party;
provided, however, that a natural person who is a dual national shall be deemed to be exclusively a national of the State of his or her dominant and effective nationality;
new financial service means a financial service not supplied in the Party’s territory that is supplied within the territory of the other Party, and includes any new form of delivery of a financial service or the sale of a financial product that is not sold in the Party’s territory;
person of a Party means “person of a Party” as defined in Article 1.6 (Definitions) and, for greater certainty, does not include a branch of an enterprise of a non-Party;
public entity means a central bank or monetary authority of a Party, or any financial institution owned or controlled by a Party; and
self-regulatory organization means any non-governmental body, including any securities or futures exchange or market, clearing agency, or other organization or association, that exercises regulatory or supervisory authority over financial service suppliers or financial institutions.
Chapter 12. TEMPORARY ENTRY FOR BUSINESS PERSONS
Article 12.1. GENERAL PRINCIPLES
1. This Chapter reflects the preferential trading relationship between the Parties, the Parties' mutual desire of facilitating temporary entry for business persons in accordance with their legislation and the provisions in Annex 12-A and of establishing transparent criteria and procedures for temporary entry for business persons as well as the need to ensure border security and to protect the domestic labor force and permanent employment in their respective territories.
2. This Chapter shall not apply to measures affecting natural persons of a Party seeking access to the employment market of the other Party, nor shall it apply to measures regarding citizenship, nationality, permanent residence, or employment on a permanent basis.
3. Nothing in this Chapter or any other provision of this Agreement shall be construed to prevent a Party from applying measures to regulate the entry of natural persons of the other Party 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 such measures are not applied in such a manner as to unduly nullify or impair the benefits accruing to the other Party under the terms of specific categories in Annex 12-A.
4. The sole fact of requiring a visa to natural persons shall not be considered to nullify or impair the provisions of this Agreement.
Article 12.2. GENERAL OBLIGATIONS
Each Party shall apply its measures related to this Chapter in accordance with Article 12.1 and, in particular, shall apply those measures so as to avoid unduly impairing or delaying trade in goods or services or conduct of investment activities under this Agreement.
Article 12.3. GRANT OF TEMPORARY ENTRY
1. Each Party shall grant temporary entry to business persons who comply with immigration measures applicable to temporary entry and other related measures, such as those related to public health and safety and national security, in accordance with this Chapter.
2. Temporary entry granted pursuant to this Chapter shall not replace the requirements demanded to carry out a profession or an activity according to the specific laws and regulations in force in the territory of the Party authorizing the temporary entry.
3. A Party may refuse to issue an immigration document authorizing employment to a business person in accordance with its legislation where the temporary entry of that person might adversely affect:
(a) the settlement of any labor dispute underway at the place or intended place of employment; or
(b) the employment of any person who is involved in such dispute.
Article 12.4. PROVISION OF INFORMATION
1. Further to Article 18.1 (Publication), each Party shall:
(a) provide to the other Party such materials as will enable the other Party to become acquainted with its measures relating to this Chapter; and
(b) no later than six months after the date of entry into force of this Agreement, prepare, publish, and make available, explanatory material regarding the requirements for temporary entry of business persons under this Chapter.
2. Each Party shall collect, maintain and, upon request, make available to the other Party, in accordance with its legislation, the information regarding the granting of temporary entry under this Chapter to business persons of the other Party who have been issued immigration documentation, including specific data for each authorized category.
3. The contact points (1) shall be in charge of exchanging the information referred to in this Article.
Article 12.5. DISPUTE SETTLEMENT
1. A Party may not initiate proceedings under Article 22.4 (Consultations), regarding a denial to grant temporary entry under this Chapter or a particular case arising under Article
12.2, unless:
(a) the matter involves a pattern of practice; and
(b) the affected business person has exhausted the available administrative proceedings regarding that particular matter, in accordance with the legislation of the denying Party.
2. The remedies referred to in paragraph 1(b) shall be deemed to be exhausted if a final determination in the matter has not been issued by the competent authority within one yearof the institution of an administrative proceeding, and the failure to issue a determination is not attributable to delay caused by the business person.
Article 12.6. COOPERATION
Taking into consideration the principles set forth in Article 12.1, the Parties shall endeavor as far as possible to:
(a) cooperate to strengthen the institutional capacity and promote technical assistance between the immigration authorities; and
(b) exchange information and experiences on regulations and implementation of programs and technology in the context of immigration matters, including those related to the use of biometric technology, advanced information systems for passengers, frequent flyer programs and security in travel documents.
Article 12.7. WORKING GROUP
1. The Parties hereby establish a Working Group on Temporary Entry of Business Persons (hereinafter referred to as the “Working Group”), comprising representatives of each Party, including immigration officials and contact points, in accordance with paragraph 3.
2. The Working Group shall meet, when necessary, to consider matters pertaining to this Chapter, such as:
(a) the implementation and administration of this Chapter;
(b) the establishment of procedures for the exchange of information on measures affecting the temporary entry under this Chapter;
(c) the development of measures to further facilitate temporary entry of business persons; and
(d) any other measures of mutual interest related to this Chapter.
3. The Working Group shall be comprised of:
(a) for Korea, a representative from Visa and Residence Division in Ministry of Justice;
(b) for Costa Rica, representatives from the Ministry of Foreign Trade (Ministerio de Comercio Exterior de Costa Rica), the Ministry of Work and Social Security (Ministerio de Trabajo y Seguridad Social) and the General Directorate of Migrations and Foreigners (Dirección General de Migración y Extranjería);
(c) for El Salvador, representatives from the Trade Agreements Administration Bureau of the Ministry of Economy (Dirección de Administración de Tratados Comerciales del Ministerio de Economía), General Directorate of Migration and Inmigration (Dirección General de Migración y Extranjería) and the Ministry of Labor (Ministerio de Trabajo);
(d) for Honduras, representatives from the Directorate General of Administration and Negotiation of Agreements of the Secretary of State in the Office of Economic Development, National Institute of Migration (Dirección General de Administración y Negociación de Tratados de la Secretaría de Estado en el Despacho de Desarrollo Económico, Instituto Nacional de Migración), and Secretary of State in the Office of Labor and Social Security (Secretaría de Estado en el Despacho de Trabajo y Seguridad Social);
(e) for Nicaragua, representatives from the Ministry of Development, Industry and Trade (Ministerio de Fomento, Industria y Comercio), General Directorate of Migration and Inmigration (Dirección General de Migración y Extranjería), and the Ministry of Labor (Ministerio del Trabajo); and
(f) for Panama, representatives from the National Immigration Service (Servicio Nacional de Migración) through the Office of International Trade Negotiations of the Ministry of Commerce and Industries (Oficina de Negociaciones Comerciales Internacionales del Ministerio de Comercio e Industrias), or their successors.
Subsection 12.8. RELATION TO OTHER CHAPTERS
1. Nothing in this Agreement shall impose any obligation on a Party regarding its immigration measures except as provided in this Chapter and Chapters 1 (Initial Provisions and General Definitions), 18 (Transparency), 21 (Institutional Provisions), 22 (Dispute Settlement), 23 (Exceptions), and 24 (Final Provisions).
2. Nothing in this Chapter shall be construed to impose obligations or commitments with respect to other Chapters of this Agreement.
Article 12.9. DEFINITIONS
For the purposes of this Chapter:
business activities means legitimate commercial activities undertaken and operated for the purpose of obtaining profits in the market, but not including the possibility of obtaining employment, wages or remuneration from a labor source in the territory of a Party granting the temporary entry;
business person means a national of a Party who is engaged in trade of goods, the supply of services, or the conduct of investment activities;
executive means a person who shall have the following basic responsibilities:
(a) managing the administration of the organization, or of a relevant component, or function within it;
(b) establishing the policies and objectives of the organization, components or function; and
(c) receiving supervision or general direction only from executives in a higher level, the board of directors or the administrative council of the organization or its shareholders;
manager means a person who shall have the following basic responsibilities:
(a) directing the organization or a department or sub-division of the organization;
(b) supervising and controlling the work of other professional employees, supervisors, or managers;
(c) having the authority to hire and dismiss or to recommend these actions, and to undertake other actions related to the management of the personnel directly supervised by this person, and to perform senior functions within the organizational hierarchy or functions related to his position; and
(d) performing discretionary actions related to the ordinary operation of the functions over which this person has authority;
pattern of practice means a practice repeatedly carried out by the immigration authorities of a Party during a representative period immediately before the execution of such practice;
specialist means a person who possesses specialized knowledge of the enterprise’s products or services and its application in international markets, or an advanced level of expertise or knowledge of the enterprise’s process and procedures; and
temporary entry means entry into the territory of a Party by a business person of the other Party without the intention to establish permanent residence.
Chapter 13. TELECOMMUNICATION （1）
Article 13.1. SCOPE
1. This Chapter shall apply to:
(a) measures adopted or maintained by a Party relating to access to and use of public telecommunications services;
(b) measures adopted or maintained by a Party relating to obligations of suppliers of public telecommunications services;
(c) other measures adopted or maintained by a Party relating to public telecommunications networks or services; and
(d) measures adopted or maintained by a Party relating to the supply of information services.
2. Except to ensure that an enterprise operating a broadcast station or cable system has continued access to and use of public telecommunications services, this Chapter shall not apply to any measure adopted or maintained by a Party relating to broadcast or cable distribution of radio or television programming.
3. Nothing in this Chapter shall be construed to:
(a) require a Party, or require a Party to compel any enterprise, to establish, construct, acquire, lease, operate, or provide telecommunications networks or services not offered to the public generally;
(b) require a Party to compel any enterprise exclusively engaged in the broadcast or cable distribution of radio or television programming to make available its broadcast or cable facilities as a public telecommunications network; or