2. Each Party shall, within 15 days after the date of receipt of the request for the establishment of the panel, appoint a panelist, nominate up to four candidates who are neither nationals nor permanent residents of the Parties for the position of chair of the panel and notify the other Party in writing of that nomination and of its proposed candidates for the position of chair of the panel.
3. If a Party fails to appoint a panelist within the time limit set out in paragraph 2, such appointment shall be made by the other Party within five days of the expiration of that time limit from among the panelists on the "Indicative List of Panelists" of the Party that failed to make the appointment.
4. The Parties shall, within 30 days of the date of receipt of the request for the establishment of a panel, endeavor to reach agreement and appoint the chairperson from among the candidates that have been proposed. If within that time the Parties are unable to agree on the chairperson, the chairperson shall be selected by lot from among the members of the "Indicative List of Non-Party Panelists" within seven days after the expiration of the 30-day period. Failure of a Party to attend the drawing of lots shall not prevent the drawing of lots.
5. If a panelist appointed by a Party resigns, is removed or is unable to serve, that Party shall appoint a new panelist within 15 days, failing which the appointment of the new panelist shall be made in accordance with paragraph 3. If the chair of the panel resigns, is removed or is unable to serve, the Parties shall agree on the appointment of a replacement within 15 days, failing which the replacement shall be appointed in accordance with paragraph 4. In either case, any period shall be suspended from the date on which the panelist or the chair resigns, is removed or is unable to serve, and the suspension shall end on the date of selection of the replacement.
6. Each Party may appoint a panelist who is not on the "Indicative List of Panelists" provided that he or she meets the requirements set out in Article 18.8.1.
7. The Parties may by mutual agreement appoint a panelist who is not on the "Indicative List of Non-Party State Panelists" provided that he or she meets the requirements set out in Article 18.8.1.
Article 18.10. RULES OF PROCEDURE
1. The Commission shall establish Rules of Procedure in accordance with Article 20.1.2(d) (The Free Trade Commission).
2. A panel established under this Chapter shall follow the Rules of Procedure. A panel may establish, in consultation with the Parties, supplementary rules of procedure that do not conflict with the provisions of this Chapter.
3. Unless the Parties agree otherwise, the Rules of Procedure shall ensure that:
(a) that the procedures shall guarantee the right to at least one hearing before the panel, as well as the opportunity to present written submissions and rebuttals;
(b) that panel hearings, deliberations, and all written submissions and communications made in the proceeding shall be confidential;
(c) that all submissions and comments made by a Party to the panel shall be made available to the other Party;
(d) the protection of information that either Party designates as confidential information; and
(e) the possibility of using technological means to conduct the proceedings, provided that the means used does not diminish the right of a Party to participate in the proceedings and that its authenticity can be guaranteed.
4. Unless otherwise agreed by the Parties within 15 days of the establishment of the panel, the terms of reference of the panel shall be:
"To examine, in an objective manner and in the light of the relevant provisions of this Agreement, the matter referred to in the request for establishment of the panel and to make findings, rulings and recommendations as provided in Article 18.11."
5. If the complaining Party alleges in the request for establishment of the panel that a matter has caused nullification or impairment of benefits within the meaning of Article 18.2(c), the terms of reference shall so state.
6. If a Party wishes the panel to make findings on the level of adverse trade effects on a Party arising from any measure found to be inconsistent with the obligations of this Agreement, or a measure of a Party found to have caused nullification or impairment within the meaning of Article 18.2(c), the terms of reference shall so state.
7. On request of a Party or on its own initiative, the panel may seek information and technical advice from such experts as it deems necessary, provided that the Parties so agree, and on such terms and conditions as the Parties may agree, in accordance with the Rules of Procedure.
8. The panel may delegate to the chairperson the authority to make administrative and procedural decisions.
9. The panel may, in consultation with the Parties, modify any time limit for its proceedings and make such other administrative or procedural adjustments as may be required for the transparency and efficiency of the proceeding.
10. The findings, determinations and recommendations of the panel, as provided in Article 18.11, shall be made by a majority of its members.
11. The panelists may submit separate opinions on matters on which a unanimous decision was not reached. The panel may not disclose the identity of the panelists who have delivered majority or minority opinions.
12. Unless otherwise agreed by the Parties, the expenses of the panel, including the remuneration of its members, shall be borne equally in accordance with the Rules of Procedure.
Article 18.11. PANEL REPORT
1. Unless the Parties agree otherwise, the panel shall base its report on the relevant provisions of this Agreement, the submissions and arguments of the Parties, or any information received by the panel pursuant to Article 18.10.
2. Unless the Parties agree otherwise, the panel shall submit the initial report to the Parties within 90 days, or 60 days in urgent cases, of the appointment of the last panelist.
3. Only in exceptional cases, if the panel considers that it cannot issue its initial report within 90 days or 60 days in urgent cases, it shall inform the Parties in writing of the reasons for the delay, together with an estimate of the time within which it will issue its report. Any delay shall not exceed an additional 30 days, unless the Parties agree otherwise.
4. The report shall contain:
(a) findings of fact and conclusions of law;
(b) determinations as to whether or not a Party has complied with its obligations under this Agreement and any other determinations requested in the terms of reference; and
(c) its recommendations for the implementation of the decision, where either Party so requests.
5. The panel shall not disclose confidential information in any of its reports, but may state findings derived from such information.
6. A Party to the dispute may submit written comments or request clarification in writing on the initial report to the panel within 15 days of the submission of the initial report, or within any other period of time established by the panel. After considering such comments and requests, the panel shall endeavor to respond to such comments and requests and, to the extent it deems appropriate, shall develop additional analysis. For this purpose, the panel may, on its own motion or at the request of any Party:
(a) request observations from any Party;
(b) conduct any due diligence it considers appropriate; or
(c) reconsider the initial report.
7. The Panel shall submit the final report to the Parties within 30 days of the submission of the initial report, unless the Parties agree on a different time period.
8. Unless the Parties agree otherwise, the Parties shall make the final report publicly available within 15 days of its submission to the Parties, subject to the protection of confidential information.
Article 18.12. REQUEST FOR CLARIFICATION OF THE REPORT
1. Within 10 days of the submission of the final report, a Party may request in writing that the panel clarify its final report. The panel shall respond to such a request within 10 days of the submission of the request. The panel's clarification shall not change the substance of its findings, determinations or recommendations.
2. The submission of a request under paragraph 1 shall not affect the time limits described in Articles 18.13 and 18.14, unless the panel decides otherwise.
Article 18.13. COMPLIANCE WITH THE REPORT
1. After receiving a panel report, the Parties shall reach an agreement on the settlement of the dispute, which shall conform to the findings and recommendations of the panel, if any, unless the Parties agree otherwise.
2. If possible, the settlement shall consist of the elimination of any measure that does not comply with this Agreement or the removal of the nullification or impairment within the meaning of Article 18.2(c).
3. If the Parties do not agree on a solution within 30 days after the submission of the report, or within such other period as the Parties may agree, the Party complained against shall, at the request of the complaining Party, enter into negotiations with a view to agreeing on compensation. Such compensation shall be of a temporary nature and shall be granted until the dispute is settled.
Article 18.14. NON-COMPLIANCE - SUSPENSION OF BENEFITS
1. If the Parties:
(a) have not reached an agreement on the settlement of the dispute and compensation has not been requested in accordance with Article 18.13 within 30 days of the submission of the report; or
(b) do not agree on compensation in accordance with Article 18.13 within 30 days of the filing of the request by the complaining Party; or
(c) have reached an agreement on dispute settlement or compensation pursuant to Article 18.13 and the complaining Party considers that the Party complained against has not complied with the terms of the agreement,
the complaining Party may, upon notification to the Party complained against, suspend benefits of equivalent effect to such Party complained against. In the notification, the complaining Party shall specify the level of benefits it proposes to suspend.
2. In considering the benefits to be suspended pursuant to paragraph 1:
(a) the complaining Party shall first seek to suspend benefits within the same sector or sectors that are affected by the measure or other matter that the panel has found to be inconsistent with the obligations under this Agreement or to have caused nullification or impairment within the meaning of Article 18.2(c); and
(b) a complaining Party that considers that it is impracticable or ineffective to suspend benefits within the same sector or sectors may suspend benefits in other sectors.
3. The suspension of benefits shall be temporary in nature and shall be applied by the complaining Party only until:
(a) the measure found to be inconsistent with the obligations of this Agreement is brought into conformity with this Agreement or the required adjustments are made in the case of nullification or impairment of benefits within the meaning of Article 18.2(c);
(b) the time at which the Parties reach agreement on the settlement of the dispute; or
(c) the panel described in Article 18.5 concludes in its report that the Party complained against has complied.
Article 18.15. COMPLIANCE REVIEW AND SUSPENSION OF BENEFITS
1. A Party may, by written communication to the other Party, request that the panel established under Article 18.6 be reconvened to determine:
(a) whether the level of suspension of benefits applied by the complaining Party pursuant to Article 18.14.1 is manifestly excessive;
(b) on any disagreement as to the existence of the measures taken to comply with the report of the panel originally established or as to the compatibility of such measures with this Agreement.
2. In the written communication, the Party shall state the specific measures or matters in dispute and provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly.
3. If the original panel or any of its members cannot be reconvened, the provisions of Article 18.9 shall apply mutatis mutandis.
4. The provisions of Articles 18.10 and 18.11 apply mutatis mutandis to procedures adopted and reports issued by a panel that is reconvened under the terms of this Article, except that, subject to Article 18.10.9, the panel shall submit an initial report within 60 days of the appointment of the last panelist if the request relates only to paragraph 1(a) and within 90 days when the request relates only to paragraph 1(b) or to both paragraphs.
5. A panel reconstituted under paragraph 1(b) shall determine whether it is appropriate to terminate any suspension of benefits. If the panel is reconstituted under paragraph 1(a) and determines that the level of suspended benefits is manifestly excessive, it shall determine the level of benefits it considers to be of equivalent effect.
Article 18.16. MATTERS RELATING TO JUDICIAL AND ADMINISTRATIVE PROCEEDINGS
1. The Commission shall endeavor to issue, as soon as possible, an appropriate non-binding interpretation or response where:
(a) a Party considers that a question of interpretation or application of this Agreement arising in an internal judicial or administrative proceeding of the other Party warrants interpretation by the Commission; or
(b) a Party notifies it of the receipt of a request for an opinion on a question of interpretation or application of this Agreement in a judicial or administrative proceeding of that Party.
2. The Party in whose territory the court or administrative body is located shall submit the interpretation agreed to by the Commission to the court or administrative body, in accordance with the procedures of the court or administrative body concerned.
3. If the Commission is unable to reach agreement, each Party may submit its own views to the court or administrative body, in accordance with the procedures of that body.
Article 18.17. SUSPENSION AND TERMINATION OF THE PROCEEDINGS
1. The Parties may agree to suspend the work of the panel at any time for a period not longer than 12 months following the date of such agreement. If the work of the panel remains suspended for more than 12 months, the authority of the panel shall lapse unless the Parties agree otherwise. If the authority of the panel lapses and the Parties have not reached an agreement on the settlement of the dispute, nothing in this Article shall preclude a Party from requesting a new proceeding on the same matter.
2. The Parties may agree to terminate the panel proceedings by joint notification to the chair of the panel at any time prior to the notification of the report.
Annex 18-A. NULLIFICATION AND IMPAIRMENT
1. A Party may have recourse to the dispute settlement mechanism under this Chapter where, by virtue of the application of a measure not inconsistent with this Agreement, it considers that the benefits that it could reasonably have expected to accrue to it from the application of any of the following provisions are nullified or impaired:
(a) Chapter 2 (Market Access for Goods);
(b) Chapter 3 (Rules of Origin and Origin Procedures);
(c) Chapter 10 (Government Procurement); or
(d) Chapter 13 (Cross-Border Trade in Services).
2. No Party may invoke Article 18.2(c) with respect to any measure subject to an exception under Article 21.1 (General Exceptions).
3. In determining the elements of nullification or impairment, the Parties may take into consideration the principles set out in the jurisprudence of paragraph 1(b) of Article XXIII of the GATT 1994.
Chapter 19. TRANSPARENCY
Article 19.1. CONTACT POINTS
1. Each Party shall designate, within 60 days after the date of entry into force of this Agreement, a contact point to facilitate and receive all communications, notifications, and information provided by the Parties on any matter covered by this Agreement.
2. At the request of the other Party, the contact point shall indicate the office or official responsible for the matter and provide such support as may be necessary to facilitate communication with the requesting Party.
Article 19.2. PUBLICATION
1. Each Party shall ensure, to the extent permitted by its law, that its laws, regulations, procedures and administrative rulings of general application that relate to any matter covered by this Agreement are, to the extent practicable, promptly published or otherwise made available for the information of interested persons and the other Party.
2. To the extent practicable, and to the extent permitted by its law, each Party shall:
(a) publish any measure referred to in paragraph 1 that it proposes to adopt relating to matters covered by this Agreement; and
(b) provide an opportunity for interested persons and the other Party to comment on such measures.
Article 19.3. PROVISION OF INFORMATION
1. On request of a Party, and to the extent permitted by its law, the other Party shall provide information and respond promptly to questions concerning any matter that could substantially affect this Agreement.
2. Any provision of information provided under this Article shall be without prejudice to whether or not the measure is consistent with this Agreement.
3. Where a Party providing information pursuant to this Agreement designates such information as confidential, the other Party shall maintain the confidentiality of such information.
Article 19.4. ADMINISTRATIVE PROCEDURES
In order to administer in a consistent, impartial, and reasonable manner all measures of general application affecting matters covered by this Agreement, each Party shall ensure that, in its administrative procedures applying the measures referred to in Article 19.2.1 with respect to particular persons, goods, or services of the other Party in specific cases:
(a) whenever possible, persons of the other Party who are directly affected by a proceeding receive, in accordance with law, reasonable notice of the initiation of the proceeding, including a description of its nature, a statement of the legal basis under which the proceeding is initiated, and a general description of all issues in dispute;
(b) when time, the nature of the proceeding, and the public interest permit, such persons are afforded a reasonable opportunity to present facts and arguments in support of their claims prior to any final administrative action; and
(c) its procedures are in accordance with its laws.
Article 19.5. REVIEW AND CHALLENGE
1. Each Party shall establish or maintain judicial or administrative tribunals or procedures for the purpose of the prompt review and, where warranted, correction of final administrative actions relating to matters covered by this Agreement. Such tribunals shall be impartial and not connected with the administrative enforcement agency or authority, and shall have no substantial interest in the outcome of the matter.
2. Each Party shall ensure that, before such tribunals or in such proceedings, the parties are entitled to:
(a) a reasonable opportunity to support or defend their respective positions; and
(b) a decision based on the evidence and arguments or, in cases where required by domestic law, on the record compiled by the administrative authority.
3. Each Party shall ensure that, subject to any means of challenge or further review available under its domestic law, such rulings are implemented by its agencies or authorities and govern the practice of those agencies or authorities with respect to the administrative action in question.
Article 19.6. SPECIFIC RULES
The provisions of this Chapter are without prejudice to the specific rules set forth in other Chapters of this Agreement.
Article 19.7. DEFINITIONS
For the purposes of this Chapter
administrative ruling of general application means an administrative ruling or interpretation that applies to all persons and factual situations that generally fall within its scope, and that establishes a standard of conduct, but does not include:
(a) rulings or decisions in an administrative proceeding that applies to a particular person, good or service of the other Party in a specific case; or
(b) a ruling that resolves with respect to a particular act or practice.
Chapter 20. ADMINISTRATION OF THE AGREEMENT
Article 20.1. THE FREE TRADE COMMISSION
1. The Parties hereby establish the Free Trade Commission, composed of representatives at the Ministerial level of each Party, in accordance with Annex 20-A, or their designees.
2. The Commission shall:
(a) ensure compliance with and proper application of this Agreement;
(b) supervise the implementation of this Agreement and evaluate the further development of this Agreement;
(c) supervise the work of all bodies established under this Agreement;
(d) to approve at its first meeting, unless otherwise agreed by the Parties, the Rules of Procedure and Code of Conduct referred to in Chapter 18 (Dispute Settlement), and to amend them as necessary;
(e) fix the amount of remuneration and expenses to be paid to panelists, assistant panelists and experts referred to in Chapter 18 (Dispute Settlement);
(f) to deal with any other matter that may affect the operation of the Agreement; and
(g) establish and modify its rules of procedure.
3. The Commission may:
(a) establish and delegate responsibilities to the bodies established pursuant to this Agreement;
(b) modify in furtherance of the objectives of this Agreement:
(i) the Schedules set out in Annex 2-B (Tariff Elimination Program) by improving tariff conditions for market access, including the possibility of accelerating tariff elimination and including one or more goods excluded in the Tariff Elimination Program;
(ii) the uniform regulations referred to in Article 3.29 (Uniform Regulations), the rules of origin set out in Annex 3-A (Specific Rules of Origin), Annex 3-B (Certificate of Origin), and Annex 3-C (Procedure for Sending and Receiving the Electronic Certificate of Origin); and
(iii) Annex 10-A (Coverage) and Annex 10-C (Means of Publication);
(c) issue interpretations of the provisions of this Agreement, which shall be binding on panels established under Article 18.6 (Establishment of a Panel) and tribunals established under Chapter 12 (Investment);
(d) review any proposed amendments to this Agreement in order to make a recommendation to the Parties;
(e) review the impacts of this Agreement on micro, small and medium-sized enterprises of the Parties;
(f) seek the advice of persons or groups with no governmental connection; and
(g) take any other action for the exercise of its functions as agreed by the Parties.
4. Each Party shall implement, in accordance with its law, any modification referred to in paragraph 3(b), within the period agreed by the Parties.
5. All decisions of the Commission shall be adopted by mutual agreement.
6. The Commission shall meet at least once a year in regular session, unless the Commission decides otherwise, or at the request of any Party. The regular sessions of the Commission shall be held alternately in the territory of the Parties or by any technological means.
Article 20.2. AGREEMENT COORDINATORS
1. Each Party shall designate an Agreement Coordinator, in accordance with Annex 20-B.
2. The Coordinators of this Agreement shall jointly perform the following functions:
(a) work on the development of agendas, as well as other preparations for the meetings of the Commission;
(b) prepare and review the technical files necessary for decision-making within the framework of this Agreement;
(c) to follow up on the decisions taken by the Commission;
(d) on the instructions of the Commission, to support the supervision of the work of all bodies established under this Agreement; and
(e) to take cognizance of any other matter that may affect the operation of this Agreement, which may be entrusted to it by the Commission.