2. The Parties, through their respective customs authorities, agree to develop a technical cooperation program under mutually agreed terms concerning the scope, timetable and cost of cooperation measures in customs-related areas, such as, inter alia:
(a) training;
(b) risk management;
(c) prevention and detection of smuggling and illicit activities;
(d) implementation of the Customs Valuation Agreement;
(e) audit and verification frameworks;
(f) electronic exchange of information; and
(g) advance rulings.
Article 5.04. Future Work Program
1. For the purpose of undertaking further steps to facilitate trade under this Agreement, the Parties agree to establish the following work program:
(a) to develop a Cooperation Program to implement the obligations under Chapter 4 (Rules of Origin and Related Customs Procedures) for the purpose of facilitating compliance with the obligations set forth in this Agreement; and
(b) to identify and submit to the Commission, where appropriate, new measures intended to promote trade facilitation among the Parties, taking as a basis the objectives and principles set forth in Article 5.01 and 5.02, including, inter alia:
(i) common customs procedures;
(ii) general measures to facilitate trade;
(iii) import and export controls ;
(iv) transport;
(v) promotion and implementation of regulations;
(vi) use of automated systems and electronic data interchange (EDI);
(vii) availability of information;
(viii) customs and other official procedures concerning the clearance of transportation means;
(ix) simplification of the required information for clearance of goods; transit of goods;
(x) trade practices; and
(xi) payment procedures for customs duties and charges.
2. The Parties may periodically review the work program referred to in this Article, for the purpose of reaching agreement on new avenues of cooperation that may result necessary to facilitate compliance with trade facilitation obligations and principles, including new procedures that may be agreed by the Parties.
3. The Parties, through their respective customs authorities and other border competent authorities shall review, where appropriate, international trade facilitation initiatives for the purpose of identifying areas in which additional joint actions would facilitate trade between the Parties and promote shared multilateral objectives.
Chapter 6. Safeguard Measures
Article 6.01. Bilateral Safeguard Measures
1. The application of bilateral safeguard measures shall be governed by provisions in this Chapter and supplemented by the provisions contained in Article XIX of GATT 1994, the Agreement on Safeguards and each Party's respective legislation.
2. During the transition period, each Party may apply a safeguard measure if, as a result of the reduction or elimination of a custom duty pursuant to this Agreement, a good originating in the territory of a Party is being imported into the territory of the other Party, in such increased quantities in absolute terms or relative to domestic production, and under such conditions, as to constitute a substantial cause of serious injury or threat thereof, to a domestic industry producing the like or directly competitive good.
3. If the conditions in paragraph 2 are met, the Party may to the extent necessary remedy or prevent serious injury or threat thereof, and facilitate adjustment:
(a) suspend the future reduction of any customs duty on the product provided for under this Agreement; or
(b) increase the customs duty on the product to a level not to exceed the lesser of:
(i) the Most-favored-Nation (MFN) applied customs duty in effect at the time the action is taken; and
(ii) the MFN applied customs duty in effect on the day immediately preceding the date of entry into force of this Agreement.
Article 6.02. Standards for a Safeguard Measures
1. Except with the consent of the Party against whose originating good the action is taken, a Party may apply a safeguard measure, including any extension thereof, for no longer than three years.
2. Subject to paragraph 1 a Party may extend the period of a safeguard measure beyond a period of two years if the investigating authority determines, in conformity with the procedures set out in Article 6.04, that the measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the domestic industry is adjusting.
3. In order to facilitate adjustment in a situation where the duration of a safeguard measure is over two years, the Party applying the measure shall progressively liberalize it at regular intervals during the extension period of application.
4. The Parties may only apply and extend the application of safeguard measures on the same good on two occasions during the transition period.
5. A safeguard measure may be applied on a second occasion, provided that at least a period equivalent to the half of that one during which the safeguard measure was applied for the first time has passed.
6. Except with the consent of the Party against whose originating good the action is taken, no Party may maintain a safeguard measure beyond the expiration of the transition period.
7. Beginning on January 1 of the year following the termination of the measure, the Party that has applied the measure shall:
(a) apply the customs duty set out in the Party Schedule to Annex 3.03 (Customs Tariff Elimination Schedule) as if the safeguard measure had never been applied; or
(b) eliminate the customs duty in equal annual stages ending on the date set out in the Party's Schedule to Annex 3.03 (Customs Tariff Elimination Schedule) from the customs duty applied before the action is taken.
Article 6.03. Provisional Measures
1. In critical circumstances, where delay would cause damage which it would be difficult to repair, a Party may take a provisional safeguard measure pursuant to a preliminary determination that there is clear evidence that imports originated from the other Party have increased as the result of the reduction or elimination of a customs duty under this Agreement, and on condition that this increase has been the cause of serious injury, or threat thereof. The duration of such a provisional measure shall not exceed 120 days.
2. The period during which a provisional safeguard measure has been applied shall be counted for purposes of determining the duration of the period during which the final safeguard measure shall be applied pursuant to Article 6.02.
3. Provisional measures that do not become final shall be excluded from the limitation provided in Article 6.02.
Article 6.04. Administration of Safeguard Proceeding
1. Each Party shall ensure consistent and impartial application of its laws, regulations, decisions and rulings governing all safeguard procedures.
2. Each Party shall entrust the procedures for applying safeguard measures, the determination of serious injury, or threat thereof, to the competent investigating authority as defined in Annex 6.04, subject to review by judicial or administrative authorities, to the extent provided by domestic legislation. Negative determinations on the existence of serious injury, or threat thereof, may not be modified by the investigating authority unless such change is required by the respective judicial or administrative bodies. The investigating authority empowered under domestic legislation to conduct such procedures shall be provided with all means necessary to fulfill its duties.
3. Each Party shall adopt or maintain equitable, timely, transparent and effective procedures for applying safeguard measures, in accordance with the requirements set forth in this Chapter and the provisions of the Agreement on Safeguards.
Article 6.05. Notification and Consultations
1. A Party shall promptly notify the other Party, in writing, on:
(a) initiating a safeguard investigation under this Chapter;
(b) making a finding of serious injury, or threat thereof, caused by increased imports under Article 6.01; and
(c) taking a decision to apply or extend a safeguard measure.
2. A Party shall provide to the other Party a copy of the public version of the report of its competent investigating authority.
3. On request of a Party whose good is subject to a safeguard investigation under this Chapter, the Party conducting that investigation shall enter into consultations with the requesting Party to review a notification under paragraph 1 or any public notice or report that the investigating authority has issued in connection with the investigation.
4. Any safeguard measure shall enter into force no later than one year from the date on which the investigation is initiated.
Article 6.06. Compensation
1. The Party applying a safeguard measure described in this Article shall after consultations with the Party against whose product the measure is applied, provide a mutually agreed 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 measure. The Party shall provide an opportunity for such consultations no later than 30 days, or a period otherwise mutually agreed, after the application of the safeguard measure.
2. If the consultations of paragraph 1 do not result in an agreement on the compensation within 30 days, or a period otherwise mutually agreed, the Party against whose originating good the measure is applied may suspend the application of substantially equivalent concessions to the trade of the Party applying the safeguard measure.
3. A Party shall notify the Party applying the safeguard measure in writing at least 30 days before suspending concessions under paragraph 2.
4. The obligation to provide compensation under paragraph 1 and the right to suspend concessions under paragraph 2 shall terminate on the later of:
(a) the termination of the safeguard measure, or
(b) the date on which the customs duty returns to the rate of duty set out in the Party Schedule to Annex 3.03 (Customs Tariff Elimination Schedule).
Article 6.07. Global Safeguard Measures
1. Each Party retains its rights and obligations under Article XIX of GATT 1994 and the Agreement on Safeguards.
2. This Agreement does not confer any additional rights or obligations on the Parties with regard to actions taken pursuant to Article XIX of the GATT 1994 and the Agreement on Safeguards, except that a Party taking such an action may exclude imports of an originating good of the other Party covered by this Agreement if that Party accounts for not more than seven percent of total imports of the good concerned.
3. No Party may apply, with respect to the same good, at the same time:
(a) a bilateral safeguard measure; and
(b) a measure under Article XIX of the GATT 1994 and the Agreement on Safeguards.
Article 6.08. Dispute Settlement on Safeguard Measures
Neither Party may request the establishment of an arbitral group pursuant to Article 22.07 (Request for Establishment of an Arbitration Group), before the other Party has imposed a safeguard measure.
Article 6.09. Definitions
For purposes of this Chapter:
Agreement on Safeguards means the WTO Agreement on Safeguards;
causality relation means "causality relation" as defined in the Agreement on Safeguards;
critical circumstances means circumstances where the delay of the application of safeguard measures could cause damage which would be difficult to repair;
domestic industry means with respect to an imported good, the producers as a whole of the like or directly competitive good, or those producers whose collective production of like or directly competitive products constitutes a major proportion of the total domestic production of such goods; and
investigating authority means the competent "investigating authority" as defined in Annex 6.04;
safeguard measure means a measure described in Article 6.01. (1)
serious injury means "serious injury" as defined in the Agreement on Safeguards (a significant overall impairment in the position of a domestic industry);
substantial cause means a cause which is important and not less than any other cause;
threat of serious injury means "threat of serious injury" as defined in the Agreement on Safeguards (serious injury that on the basis of facts and not merely on allegation, conjecture, or remote possibilities, is clearly imminent); and
transition period means the tariff elimination period for the good set out in the Party's Schedule.
Chapter 7. Unfair Trade Practices
Anti-dumping and Countervailing Duty Matters
Article 7.01. Anti-dumping and Countervailing Duties
Except as provided in this Chapter, an antidumping measure or countervailing duty imposed by a Party on the goods imported from territory of the other Party shall be subject to Article VI of the GATT 1994, AD Agreement and the SCM Agreement, as appropriate.
Article 7.02. Consultations
Without prejudice to the right of any Party, a Party may invite the other Party for consultations, prior to initiating an antidumping or countervailing investigation under this Chapter, with the aim of clarifying the facts of the situation and to arrive at a mutually agreed solution.
Article 7.03. Standing of Domestic Industry
An antidumping or countervailing investigation shall not be initiated between the Parties unless the authorities have determined that the application has been made by or on behalf of the domestic industry whose collective output constitutes more than 50 percent of the total production of the like good produced by the domestic industry.
Article 7.04. Maximum Period for Completing on Investigation
An antidumping or countervailing investigation initiated by a Party against the products imported from the territory of the other Party shall be concluded within one year and, in special circumstances, this period may be extended to no more than 15 months, after its initiation.
Article 7.05. Duration of the Measures
Any definitive antidumping or countervailing duty imposed by a Party on a good imported from territory of the other Party shall be terminated on a date not later than four years from its imposition, notwithstanding the right to review in accordance with the WTO Agreement included in Article 7.01.
Article 7.06. Modifications
The Parties agree that negotiations for modifications of this Chapter will be initiated if a Party deems necessary.
Part Three. Technical Barriers to Trade
Chapter 8. Sanitary and Phytosanitary Measures
Article 8.01. Objectives
The objectives of this Chapter are to protect human, animal, or plant life or health in the Partiesâ territories, enhance the implementation of the SPS Agreement, and establish a Committee for addressing and resolving issues on sanitary and phytosanitary matters.
Article 8.02. General Provisions
1. The Parties reaffirm the provisions under the SPS Agreement.
2. Those that are legally responsible for ensuring compliance with sanitary and phytosanitary requirements provided in this Chapter are deemed as the competent authorities.
3. Based on the SPS Agreement, the Parties establish this framework of rules and disciplines to guide the development, adoption and compliance with sanitary and phytosanitary measures.
4. The Parties, shall facilitate trade through mutual cooperation to prevent the introduction or spread of pests and diseases, and improve plant health, animal health, and food safety.
Article 8.03. International Standards and Harmonization
With the aim to harmonize sanitary and phytosanitary measures, the Parties shall follow the principles as described below:
(a) each Party shall use international standards, guidelines or recommendations as reference guideline for its sanitary and phytosanitary measures;
(b) each Party may adopt, implement, establish or maintain a sanitary or phytosanitary measure with a level of protection different from or stricter than that of international standards, guidelines or recommendations, provided that there is scientific justification for the measure;
(c) with the aim of reaching a higher degree of harmonization, each Party shall follow the guidelines of the SPS Agreement, the IPPC for plant health, the OIE for animal health and the Codex on food safety and tolerance limits; and
(d) the Parties shall establish harmonized systems for the procedures of control, inspection and approval of the sanitary and phytosanitary measures for animals, plants, their products and by-products as well as food safety.
Article 8.04. Equivalence
For the purpose of applying sanitary and phytosanitary measures in the territories of the Parties, the Parties shall accept as equivalent the sanitary and phytosanitary measures of the other Party in accordance with the following principles:
(a) a Party shall accept the sanitary or phytosanitary measures of the other Party as equivalent, even if these measures differ from its own in the same product, if the other Party objectively demonstrates to the Party that its measures, based on scientific information and risk assessment, achieve the Party's appropriate level of sanitary or phytosanitary protection. At the request of a Party, the other Party shall grant reasonable access for information related to inspection, testing and other relevant procedures; and
(b) the Parties shall facilitate access to their territories for purposes of inspection, testing, and other relevant procedures in order to establish equivalence between their sanitary and phytosanitary measures.
Article 8.05. Assessment of Risk and Determination of the Appropriate Level of Sanitary or Phytosanitary Protection
In accordance with the guidelines developed by relevant international organizations recognized by the WTO:
(a) the Parties shall ensure that their sanitary or phytosanitary measures are, based on an assessment, as appropriate to the circumstances, of the existing risks to human (food safety), animal or plant life or health protection, taking into account the guidelines and risk assessment techniques developed by the relevant international organizations;
(b) the Parties shall facilitate the necessary conditions for the evaluation of their sanitary or phytosanitary services, by using the procedures in force, for the assessment of controls, inspections and application of sanitary or phytosanitary measures and programs, taking into account the guidelines and recommendations of the relevant international organizations;
(c) in assessing the risk that may exist in a commodity and establishing the appropriate level of protection, the Parties shall take into account the following factors:
(i) available technical and scientific information;
(ii) existence of pests or diseases, and recognition of pest or disease-free areas and areas of low pest or disease prevalence;
(iii) epidemiology of pests or diseases;
(iv) analysis of critical control points in sanitary (food safety) and phytosanitary aspects;
(v) physical, chemical and biological hazards in foods;
(vi) relevant ecological and environmental conditions;
(vii) production methods and processes, and the inspection, sampling and testing methods;
(viii) structure and organization of sanitary or phytosanitary services;
(ix) protection procedures, epidemiological surveillance, diagnosis and treatment to ensure food safety;
(x) loss of production or sales in the event of entry, establishment, or spread of a pest or disease;
(xi) applicable quarantine measures and treatments that shall satisfy the importing Party on risk mitigation; and
(xii) the cost of control or eradication of pests or diseases in the territory of the importing Party, and the cost-effectiveness of alternative approaches to reduce risks;
(d) when establishing the appropriate level of protection, the Parties shall avoid arbitrary or unjustifiable distinctions, if such distinctions result in discrimination or disguised restriction on trade;
(e) when a Party determines that relevant scientific evidence is insufficient for a risk assessment, it may adopt a provisional sanitary or phytosanitary measure on the basis of available information, including information from the relevant international organizations described in this Chapter. In such circumstances, the Parties shall seek to obtain the additional information necessary for a more objective risk assessment and review the sanitary or phytosanitary measure accordingly within a reasonable period of time. For this purpose, the following procedures shall be applied:
(i) the importing Party provisionally applying the sanitary or phytosanitary measure shall, within 30 days of adopting the provisional measure, request the technical information necessary to complete a risk assessment from the other Party, which shall provide the required information. In case the information is not provided, the provisional measure shall be maintained, and if the information is not requested within the established period, the provisional measure shall be withdrawn;
(ii) if the importing Party has requested the information, it shall be a period of 60 days from the date of provision of such information to revise, withdraw or maintain the provisional measure as definitive. If necessary, the Party may extend the period;
(iii) the importing Party may request clarification of the information provided by the exporting Party;
(iv) the importing Party shall allow the exporting Party to provide its comments and shall take these into account in the conclusion of the risk assessment; and
(v) the adoption or amendment of a provisional sanitary or phytosanitary measure shall be immediately notified to the other Party through the notification authorities established under the SPS Agreement;
(f) where the risk assessment results in non-acceptance of an import, the scientific basis for the decision shall be notified in writing; and
(g) when a Party has reasons to believe that a specific sanitary or phytosanitary measure introduced or maintained by another Party is restricting, or has the potential to restrict its exports and the measure is not based on the relevant international standards, guidelines or recommendations, or such standards, guidelines or recommendations do not exist, an explanation of the reasons for such sanitary or phytosanitary measure may be requested and shall be provided by the Party maintaining the measure within 60 days from the date on which its competent authority receives the inquiry.
Article 8.06. Recognition of Pest- or Disease-Free Areas and Areas of Low Pest or Disease Prevalence
1. The Parties shall recognize, based on international standards, guidelines or recommendations, the pest- or disease-free areas and areas of low pest or disease prevalence. They shall take into account such factors as geographical situation, ecosystems, epidemiological surveillance, and the effectiveness of sanitary and phytosanitary controls in the area.
2. The Party declaring that an area within its territory is free of a specific pest or disease shall demonstrate such a condition objectively to the importing Party, and give assurances that the area shall remain free of that pest or disease on the basis of protection measures adopted by the authorities responsible for sanitary and phytosanitary services.