Central America - Panama FTA (2002)
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1. Each Party shall promote and facilitate the arbitration and other means of alternative for the settlement of international commercial disputes between private parties in the Free Trade Area.

2. For the purposes of paragraph 1, each Party shall provide appropriate procedures to ensure observance of agreements to arbitrate which has ratified, and the recognition and enforcement of arbitral awards in such disputes.

3. The Commission shall establish an advisory committee on private commercial disputes comprising persons with expertise or experience in the resolution of private international commercial disputes. Once established, the Committee shall report and general recommendations to the Commission on the existence, use and effectiveness of arbitration and other procedures for the resolution of disputes.

Chapter 21. Exceptions

Article 21.01. Definitions

For purposes of this chapter:

Tax convention means a convention for the avoidance of double taxation or other international agreement or arrangement taxation;

The Fund: international Monetary Fund;

Payments for current international transactions means payments for current international transactions as defined under the Articles of Agreement of the International Monetary Fund;

International capital transactions "means international capital transactions as defined under the Articles of Agreement of the International Monetary Fund; and

Transfers means international transactions and related international transfers and payments.

Article 21.02. General Exceptions

1. This Treaty shall be incorporated into and form an integral part thereof, article XX of GATT 1994 and its interpretative notes for purposes of:

a) Part two (trade in goods), except to the extent that some of its provisions apply to services or investment;

b) Part Three (Technical Barriers to Trade), except to the extent that some of its provisions apply to services or investment;

c) Chapter 15 (competition policy, State monopolies and enterprises), to the extent that some of its provisions apply to goods; and

d) (chapter 16 government procurement), to the extent that some of its provisions apply to goods.

2. This Treaty shall be incorporated into and form an integral part thereof, subparagraphs (a), (b) and (c) of article XIV of the GATS, for purposes of:

a) Part two (trade in goods), to the extent that some of its provisions apply to services;

b) Part Three (Technical Barriers to Trade), to the extent that some of its provisions apply to services;

c) Chapter 10 (investment);

d) Chapter 11 (cross-border trade in services);

e) Chapter 12 (Financial Services);

f) Chapter 13 (telecommunications);

g) Chapter 14 (temporary entry for business persons);

h) Chapter 15 (competition policy, State monopolies and enterprises), to the extent that some of its provisions apply to services; and

i) (chapter 16 government procurement), to the extent that some of its provisions apply to services.

Article 21.03. National Security

Nothing in this Treaty shall be construed as:

a) To require a party to furnish or allow access to information the disclosure of which it considers contrary to its essential security interests;

b) Prevent a Party from taking any action which it considers necessary to protect its essential security interests:

i) Relating to trade in arms, munitions and war materiel and trade operations and on goods, materials, technology and services undertaken directly or indirectly for the purpose of supplying a military establishment or other establishment of defence;

ii) Applied in time of war or other serious international tension or;

iii) With regard to the implementation of national policies or international agreements in the field of non-proliferation of nuclear weapons or other nuclear explosive devices; or

c) To prevent any Party from taking action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

Article 21.04. Balance of Payments

1. Nothing in this Treaty shall be construed as preventing a party from maintaining or adopting measures that restrict transfers where the party faces serious difficulties in their balance of payments, or threat thereof, provided that such restrictions are consistent with this article.

2. As soon as practicable after a party to apply a measure under this article, in accordance with the provisions of its international obligations, the Party:

a) Subject to revision of all restrictions on current account transactions in accordance with article VIII of the Articles of Agreement of the International Monetary Fund;

b) Shall enter into consultations in good faith with the IMF on economic adjustment measures to address the fundamental underlying problems in the economic difficulties; and

c) Endeavour to adopt or maintain economic policies consistent with such consultations.

3. The measures that apply or maintain in accordance with this Article shall:

a) To avoid unnecessary damage to the economic, commercial or financial interests of the other party;

b) Shall not be more burdensome than necessary to deal with the balance of payments difficulties or threat thereof;

c) Be temporary and phased out progressively as the situation improves the balance of payments;

d) Consistent with paragraph 2 (c) and with the Articles of Agreement of the International Monetary Fund; and

e) Application of agreement with the most favourable, including the principles of National Treatment and most-favoured nation.

4. A Party may adopt or maintain a measure under this article that gives priority to services that are essential to its economic programme, provided that the Party does not impose a measure for the purpose of protecting a specific industry or sector unless the measure is consistent with paragraph 2 (c) and with article VIII (3) of the Articles of Agreement of the International Monetary Fund.

5. Restrictions imposed on transfers:

a) Shall be consistent with article VIII (3) of the Articles of Agreement of the International Monetary Fund, where they apply to payments for current international transactions;

b) Shall be consistent with article VI of the Articles of Agreement of the IMF and be imposed only in conjunction with measures on payments for current international transactions under paragraph 2 (a), where they apply to international capital transactions; and

c) May not take the form of surcharges, tariff quotas, licensing or similar measures.

Article 21.05. Exceptions to Disclosure of Information

Nothing in this Treaty shall be construed as requiring a party to furnish or allow access to information the disclosure of which would impede the enforcement or otherwise be contrary to the Constitution, to the public interest or their laws concerning the protection of the privacy of individuals, the accounts and financial affairs of individual customers of financial institutions.

Article 21.06. Taxation

1. Except as provided in this article nothing in this Agreement shall apply to Taxation Measures.

2. Nothing in this Agreement shall affect the rights and obligations of either party under any tax convention. In the event of incompatibility between any of these treaties and this treaty, they shall prevail to the extent of the inconsistency.

3. Notwithstanding paragraph 2:

a) Article 3.03 (National Treatment) and such other provisions in this Treaty necessary to give effect to that article shall apply to taxation measures to the same extent as article III of the GATT 1994; and

b) Article 3.14 (export taxes) shall apply to taxation measures.

4. For the purposes of this article: Taxation Measures do not include:

a) A customs tariff "as defined in article (2.01 definitions of general application); or

b) The measures listed exceptions in (b), (c) and (d) that definition.

5. Subject to paragraph 2:

a) Articles 1103 (National Treatment), and 12.06 (National Treatment) shall apply to Taxation Measures on income or capital gains on the capital of taxable corporations, relating to the purchase or consumption of particular services;

b) Articles 10.02 (National Treatment), (10.03 most-favoured-nation treatment); 1103 (National Treatment) and 11.04 (most-favoured-nation treatment); and (12.06 National Treatment) and 12.07 (most-favoured-nation treatment) apply to all taxation measures, other than those on income or capital gains on the capital of taxable corporations, as well as taxes on capital, inheritance and gifts.

Nothing in these rules shall not apply to:

i) Any most favoured nation obligations with respect to advantages accorded by a Party pursuant to a tax convention;

ii) Any dissenting provision of any existing taxation measure;

iii) The continuation or renewal of a provision of any dissenting existing taxation measure;

(IV) reforms to dissenting A provision of any existing taxation measure, in both the amendment does not decrease, at the time of his grade in accordance with any of those articles; or

v) Any new taxation measure aimed at ensuring the implementation and tax collection of fair and effective, and that does not arbitrarily discriminate between individuals, goods or services of the Parties or nullifies or impairs similarly advantages granted pursuant to those articles, in the sense of nullification and impairment (annex 20).

Chapter 22. Final Provisions

Article 22.01. Amendments

1. Without prejudice to articles 19.01 (5) (Committee administering the treaty 2203) (2), and any amendment to this Treaty shall require the agreement of all the parties.

2. The agreed amendments shall enter into force after approval by the appropriate legal procedures of the Parties, and shall constitute an integral part of this Treaty.

Article 22.02. Reservations

This Treaty shall not be subject to reservations and interpretative declarations at the time of ratification.

Article 22.03. Duration

1. This Treaty shall have indefinite duration and shall enter into force between Panama and each Central American country on the thirtieth day after the date on which respectively have exchanged their respective instruments of ratification certifying that the necessary legal procedures and formalities have been completed.

2. For the present treaty takes effect between Panama and each Central American country, in the instruments of ratification shall be that the legal procedures and formalities have been completed on bilateral protocol containing:

a) Annex 3.04 (tariff relief) on the programme of tariff relief between Panama and the Central American country;

b) Section C of annex 4.03 (specific rules of origin) applicable between Panama and the Central American country;

c) Annexes I, II, III and IV of chapter 10 (investment) relating to reservations and restrictions on investment applicable between Panama and the Central American country;

d) Annexes I, II and V of chapter 11 (cross-border trade in services), relating to reservations and restrictions on cross-border services applicable between Panama and the Central American country;

e) Chapter 12 of annex VI (Financial Services), relating to reservations and restrictions on financial services applicable between Panama and the Central American country;

f) Annexes 3.10 (6) (restrictions on the importation and exportation) and 16.01 (entities), where appropriate; and (g) Such other matters as the parties may agree.

3. Protocols to be concluded pursuant to paragraph 2 shall be an integral part of this Treaty.

Article 22.04. Annexes

The annexes to this Agreement constitute an integral part of it.

Article 22.05. Denunciation

1. Any Party may denounce this Treaty. If Panama is not a party to the complaint, the Treaty shall remain in force for the other parties.

2. Denunciation shall take effect one hundred and eighty (180) days after be communicated to the other parties, without prejudice to the parties may agree on a different period.

Conclusion

Done in Panama City, Panama, six days of March two thousand six two original copies in equally authentic.

Miguel Ángel Rodríguez Echeverría President of the Republic of Costa Rica

Francisco Flores Pérez

The President of the Republic of El Salvador

Alfonso Portillo Cabrera

The President of the Republic of Guatemala

Enrique Bolaños Geyer

The President of the Republic of Nicaragua

Mireya Moscoso Rodríguez President of the Republic of Panama

Vincent Williams

First appointed Chair Honduras

In witness honour

Fernando Henrique Cardoso

President of the Federative Republic of Brazil

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  • Article   1.01 Establishment of the Free Trade Area 1
  • Article   1.02 Objectives 1
  • Article   1.03 Compliance 1
  • Article   1.04 Relation to other International Agreements 1
  • Article   1.05 Succession of Treaties 1
  • Chapter   2 General Definitions 1
  • Article   2.01 Definitions of General Application 1
  • Part   two Trade In Goods 1
  • Chapter   three National Treatment and Market Access of Goods 1
  • Section   A Definitions and Scope of Application 1
  • Article   3.01 Definitions 1
  • Article   3.02 Scope 2
  • Section   C Tariffs 2
  • Article   3.04 Programme of Tariff Relief 2
  • Article   3.05 Temporary Admission of Goods 2
  • Article   3.06 Import Free of Customs Tariff for Commercial Samples of Negligible Value or No Commercial Value and Printed Materials Advertising 2
  • Article   3.07 Re-imported Goods after Having Been Repaired or Altered 2
  • Article   3.08 Customs Valuation 2
  • Article   3.09 Restrictions on Domestic Support and Programmes to Support Exports 2
  • Article   3.10 Restrictions on Imports and Exports 2
  • Article   3.11 Rights of Customs Formalities and Consular Rights 2
  • Article   3.12 Geographical Indications and Designations of Origin 2
  • Article   3.13 Country of Origin 2
  • Article   3.14 Export Taxes 2
  • Article   3.15 International Obligations 2
  • Chapter   4 Rules of Origin 2
  • Article   4.01 Definitions 2
  • Article   4.02 Instruments of Application and Interpretation 2
  • Article   4.03 Goods Originating 2
  • Article   4.04 Minimal Operations or Processes 3
  • Article   4.05 Indirect Materials 3
  • Article   4.06 Cumulation 3
  • Article   4.07 The Regional Value Content 3
  • Article   4.08 De Minimis 3
  • Article   4.09 Fungible Goods 3
  • Article   4.10 Sets or Sets of Goods 3
  • Article   4.11 Accessories , Spare Parts and Tools 3
  • Article   4.12 Packaging Materials and Containers In Which a Good Is Submitted for Retail Sale 3
  • Article   4.13 Packing Materials and Containers for Shipment 3
  • Article   4.14 Transhipment and Direct Consignment or International Transit 3
  • Chapter   5 Customs Procedures 3
  • Article   5.01 Definitions 3
  • Article   5.02 Certificate of Origin and Declaration 3
  • Article   5.03 Obligations with Respect to Imports 3
  • Article   5.04 Obligations with Regard to Exports 3
  • Article   5.05 Exceptions 3
  • Article   5.06 Invoicing by a Third-country Operator 3
  • Article   5.07 Confidentiality 3
  • Article   5.08 Procedures for Verification of Origin 3
  • Article   5.09 Resolution Advance 4
  • Article   5.10 Review and Challenge 4
  • Article   5.11 Sanctions 4
  • Article   5.12 Uniform Regulations 4
  • Article   5.13 Cooperation 4
  • Article   5.14 Recognition and Acceptance of the Certificate of Origin 4
  • Chapter   6 Safeguard Measures 4
  • Article   6.01 Definitions 4
  • Article   6.02 Bilateral Safeguard Measures 4
  • Article   6.03 Global Safeguard Measures 4
  • Article   6.04 Procedures Concerning the Administration of Safeguard Measures 4
  • Article   6.05 Dispute Settlement In Safeguard Measures 5
  • Chapter   7 UNFAIR TRADE PRACTICES 5
  • Article   7.01 Scope of Application 5
  • Article   7.02 Duration of Investigations on Unfair Trading Practices 5
  • Article   7.03 Initiation of Back-to-back Investigations 5
  • Article   7.04 Duration of Anti-dumping Duties 5
  • Article   7.05 Establishment of Anti-dumping Duties 5
  • Part   Three Technical Barriers to Trade 5
  • Chapter   8 Sanitary and Phytosanitary Measures 5
  • Article   8.01 Definitions 5
  • Article   8.02 General Provisions 5
  • Article   8.03 Rights of Parties 5
  • Article   8.04 Obligations of the Parties 5
  • Article   8.05 International Standards and Harmonization 5
  • Article   8.06 Equivalence 5
  • Article   8.07 Risk Assessment and Determination of the Appropriate Level of Sanitary and Phytosanitary Protection 5
  • Article   8.08 Recognition of Disease or Pest Free Areas and Areas of Low Disease or Pest Prevalence 5
  • Article   8.09 Control Procedures, Inspection and Approval 5
  • Article   8.10  Transparency 5
  • Article   8.11 Committee on Sanitary and Phytosanitary Measures 6
  • Article   8.12 Technical Cooperation 6
  • Chapter   9 STANDARDIZATION MEASURES, METROLOGY AND APPROVAL PROCEDURES 6
  • Article   9.01 Definitions 6
  • Article   9.02 General Provisions 6
  • Article   9.03 Scope of Application 6
  • Article   9.04  Basic Rights and Obligations 6
  • Article   9.05 Risk Assessment 6
  • Article   9.06 Compatibility and Equivalence 6
  • Article   9.07 Conformity Assessment 6
  • Article   9.08  Authorization Procedures 6
  • Article   9.09 Metrology 6
  • Article   9.10  Notification 6
  • Article   9.11  Information Centers 6
  • Article   9.12 Committee of Standardization, Metrology and Authorization Procedures 6
  • Article   9.13 Technical Cooperation 6
  • Part   IV Investment, Services and Related Matters 6
  • Chapter   10 6
  • Section   A Investment 6
  • Article   10.04 Standard of Treatment 7
  • Article   10.05 Treatment In Case of Loss 7
  • Article   10.06 Minimum Standard of Treatment 7
  • Article   10.07 Performance Requirements 7
  • Article   10.08 Senior Executives and Boards of Directors or Boards of Executive Officers 7
  • Article   10.09 Reservations and Exceptions 7
  • Article   10.10 Transfers 7
  • Article   10.11 Expropriation and Compensation 7
  • Article   10.12 Special Formalities and Information Requirements 7
  • Article   10.13 Relationship with other Chapters 7
  • Article   10.14 Denial of Benefits 7
  • Article   10.15 Environmental Measures 7
  • Section   B Settlement of Disputes between an Investor of One Party and the other Party 7
  • Article   10.16 Objective 7
  • Article   10.17 Claim by an Investor of a Party on Its Own Behalf 7
  • Article   10.18 Claim by an Investor of a Party on Behalf of an Enterprise 7
  • Article   10.19 Dispute Settlement Through Consultation and Negotiation 7
  • Article   10.20 Notification of Its Intention to Submit the Claim to Arbitration 7
  • Article   10.21 Submission of a Claim to Arbitration 7
  • Article   10.22 Conditions Precedent to Submission of a Claim to Arbitration Proceedings 7
  • Article   10.23 Consent to Arbitration 7
  • Article   10.24 Number and Method of Appointment of Arbitrators 7
  • Article   10.25 Integration of the Tribunal If a Party Fails to Appoint an Arbitrator or Combatant Warring Parties Fail to Agree on the Designation of the Chairman of the Tribunal 7
  • Article   10.26 Agreement to Appointment of Arbitrators 7
  • Article   10.27 Accumulation of Procedures 7
  • Article   10.28 Notification 8
  • Article   10.29 A Party 8
  • Article   10.30 Documentation 8
  • Article   10.31 The Arbitral Proceedings 8
  • Article   10.32 Applicable Law 8
  • Article   10.33 Interpretation of Annexes 8
  • Article   10.34 Expert Opinions 8
  • Article   10.35 Interim Measures of Protection 8
  • Article   10.36 Final Award 8
  • Article   10.37 Finality and Enforcement of the Award 8
  • Article   10.38 General Provisions 8
  • Article   10.39 Exclusions 8
  • Article   10.40 Definitions 8
  • Chapter   11 Cross-border Trade In Services 8
  • Article   11.01 Definition 8
  • Article   11.02 Scope of Application 8
  • Article   11.03 National Treatment 9
  • Article   11.04 Most Favoured Nation Treatment 9
  • Article   11.05 Standard of Treatment 9
  • Article   11.06 Local Presence 9
  • Article   11.07 Granting Licences, Authorizations or Licences, Certifications 9
  • Article   11.08 Reservations 9
  • Article   11.09 Non-discriminatory Quantitative Restrictions 9
  • Article   11.10 Denial of Benefits 9
  • Article   11.11 Future Liberalization 9
  • Article   11.12 Proceedings 9
  • Article   11.13 Recognition of Higher Education Degrees 9
  • Article   11.14 Disclosure of Confidential Information 9
  • Article   11.15 Committee on Investment and Cross-border Trade In Services 9
  • Article   11.16 International Inland Freight Transport 9
  • Chapter   12 Financial Services 9
  • Article   12.01 Definitions 9
  • Article   12.02 Scope of Application 9
  • Article   12.03 Autoregulados Agencies 9
  • Article   12.04 Right of Establishment 9
  • Article   12.05 Cross-border Trade 9
  • Article   12.06 National Treatment 9
  • Article   12.07 Most Favoured Nation Treatment 9
  • Article   12.08 Recognition and Harmonization 9
  • Article   12.09 Exceptions 10
  • Article   12.10  Transparency 10
  • Article   12.11 Financial Services Committee 10
  • Article   12.12 Consultations 10
  • Article   12.13 New Financial Services and Data Processing 10
  • Article   12.14 Senior Management and Boards of Directors or Governing Council 10
  • Article   12.15 Reserves and Specific Commitments 10
  • Article   12.16 Denial of Benefits 10
  • Article   12.17 Transfers 10
  • Article   12.18 Settlement of Disputes between the Parties 10
  • Article   12.19 Investment Dispute Settlement In Financial Services between an Investor of One Party and Party a 10
  • Chapter   13 Telecommunications 10
  • Article   13.01 Exclusion 10
  • Article   13.02 Definitions 10
  • Article   13.03 Scope of Application 10
  • Article   13.04 Access to Public Telecommunications Networks and Services and Its Use 10
  • Article   13.05 Conditions for the Provision of Enhanced Services 10
  • Article   13.06 Measures Related to Standardization 11
  • Article   13.07 Monopolies or Anticompetitive Practices 11
  • Article   13.08 Transparency 11
  • Article   13.09 Relationship to other Chapters 11
  • Article   13.10 Relationship with Organizations and International Treaties 11
  • Article   13.11 Technical Cooperation and other Consultations 11
  • Chapter   14 TEMPORARY ENTRY OF BUSINESS PERSONS 11
  • Article   14.01 Definitions 11
  • Article   14.02 General Principles 11
  • Article   14.03 General Obligations 11
  • Article   14.04 Temporary Entry Authorization 11
  • Article   14.05 Provision of Information 11
  • Article   14.06 Dispute Resolution 11
  • Article   14.07 Relationship to other Chapters 11
  • Chapter   15 COMPETITION, MONOPOLIES AND STATE-OWNED ENTERPRISES POLICY 11
  • Section   A Competition Policy 11
  • Article   15.01 Cooperation 11
  • Article   15.02 Future Work Programme 11
  • Section   B State Monopolies and Enterprises 11
  • Article   15.03 Monopolies and State-owned Enterprises 11
  • Part   VI Procurement 11
  • Chapter   16 Procurement 11
  • Article   16.01 Definitions 11
  • Article   16.05 Technical Specifications 11
  • Article   16.06 Denial of Benefits 11
  • Article   16.07 Challenge Procedures 11
  • Article   16.08 Modifications to Coverage 11
  • Article   16.09 Privatization 12
  • Article   16.10 Information Technology 12
  • Article   16.11 Public Procurement Committee 12
  • Article   16.12 Cooperation and Technical Assistance 12
  • Article   16.13 Relationship to other Chapters 12
  • Article   16.14 Settlement of Disputes 12
  • Article   16.15 Entry Into Force 12
  • Chapter   17 Intellectual Property 12
  • Article   17.01 Implementation 12
  • Article   17.02 Enforcement of Intellectual Property 12
  • Article   17.03 Border Measures 12
  • Article   17.04 Transparency of Intellectual Property 12
  • Article   17.05 12
  • Article   17.06 Settlement of Disputes 12
  • Part   VIII Administrative and Institutional Provisions 12
  • Chapter   18 Transparency 12
  • Article   18.01 Definitions 12
  • Article   18.02 Information Center 12
  • Article   18.03 Publication 12
  • Article   18.04 Provision of Information 12
  • Article   18.05 Hearing, Legality and Due Process Guarantees 12
  • Article   18.06 Administrative Procedures for the Adoption of Measures of General Application 12
  • Article   18.07  Review and Challenge 12
  • Article   18.08 Communications and Notifications 12
  • Chapter   19 TREATY ADMINISTRATION 12
  • Section   A Committee, Subcommittee and Secretariat 12
  • Article   19.01 Treaty Administrative Commission 12
  • Article   19.02 Treaty Administrative Subcommittee 12
  • Article   19.03 Secretariat 12
  • Section   B Committees , Subcommittees and Expert Groups 12
  • Article   19.04 General Provisions 12
  • Article   19.05 Committees 13
  • Article   19.06 Subcommittees 13
  • Article   19.07 Expert Groups 13
  • Chapter   20 DISPUTE SETTLEMENT 13
  • Section   A Dispute Resolution 13
  • Article   20.01 Definitions 13
  • Article   20.02 General Provisions 13
  • Article   20.03 Scope 13
  • Article   20.04 Election of the Fora 13
  • Article   20.05 Cases of Urgency 13
  • Article   20.06 Consultations 13
  • Article   20.07 Intervention of the Commission, Good Offices, Mediation and Conciliation 13
  • Article   20.08 Request for Integration of the Arbitration Panel 13
  • Article   20.09 List of Arbitrators 13
  • Article   20.10 Qualities of Arbitrators 13
  • Article   20.11 Integration of the Arbitral Group 13
  • Article   20.12 Model Rules of Procedure 13
  • Article   20.13 Third Parties 13
  • Article   20.14 Information and Technical Advice 13
  • Article   20.15 Preliminary Report 13
  • Article   20.16 Final Report 13
  • Article   20.17 Implementation of the Final Report 13
  • Article   20.18 Suspension of Benefits 13
  • Section   B Domestic and Private Commercial Dispute Settlement Proceedings 13
  • Article   20.19 Interpretation of the Treaty to Domestic Judicial and Administrative Bodies 13
  • Article   20.20 Rights of Individuals 13
  • Article   20.21 Alternative Means of Dispute Settlement between Individuals 14
  • Chapter   21 Exceptions 14
  • Article   21.01 Definitions 14
  • Article   21.02 General Exceptions 14
  • Article   21.03 National Security 14
  • Article   21.04 Balance of Payments 14
  • Article   21.05 Exceptions to Disclosure of Information 14
  • Article   21.06 Taxation 14
  • Chapter   22 Final Provisions 14
  • Article   22.01 Amendments 14
  • Article   22.02 Reservations 14
  • Article   22.03 Duration 14
  • Article   22.04 Annexes 14
  • Article   22.05 Denunciation 14