Annex II. CHILE - EXPLANATORY NOTES
1. The Schedule of Chile to this Annex sets out, pursuant to Article 8.11 (Non-Conforming Measures) and Article 9.7 (Non-Conforming Measures), the specific sectors, subsectors or activities for which Chile may maintain existing, or adopt new or more restrictive, measures that do not conform with obligations imposed by:
(a) Article 8.5 (National Treatment) or Article 9.3 (National Treatment);
(b) Article 8.6 (Most-Favoured-Nation Treatment) or Article 9.4 (Most-Favoured- Nation Treatment);
(c) Article 8.9 (Performance Requirements);
(d) Article 8.10 (Senior Management and Boards of Directors);
(e) Article 9.5 (Local Presence); or
(f) Article 9.6 (Market Access).
2. Each Schedule entry sets out the following elements:
(a) Sector refers to the sector for which the entry is made;
(b) Sub-Sector, where referenced, refers to the specific subsector for which the entry is made;
(c) Industry Classification, where referenced, refers to the activity covered by the non-conforming measure, according to the provisional CPC codes as used in the Provisional Central Product Classification (Statistical Papers Series M No. 77, Department of International Economic and Social Affairs, Statistical Office of the United Nations, New York, 1991);
(d) Obligations Concerned specifies the obligations referred to in paragraph 1 that, pursuant to Article 8.11.2 (Non-Conforming Measures) and Article 9.7.2 (Non- Conforming Measures), do not apply to the sectors, subsectors or activities listed in the entry;
(e) Description sets out the scope or nature of the sectors, subsectors or activities covered by the entry to which the reservation applies; and
(f) Existing Measures, where specified, identifies, for transparency purposes, a non-exhaustive list of existing measures that apply to the sectors, subsectors or activities covered by the entry.
3. In accordance with Article 8.11.2 (Non-Conforming Measures) and Article 9.7.2 (Non- Conforming Measures), the articles of this Agreement specified in the Obligations Concerned element of an entry do not apply to the sectors, subsectors and activities identified in the Description element of that entry.
4. With respect to Annex II entries on Most-Favoured-Nation Treatment relating to bilateral or multilateral international agreements, the absence of language regarding the scope of the reservation for differential treatment resulting from an amendment of those bilateral or multilateral international agreements in force or signed prior to the date of entry into force of this Agreement is without prejudice to Chile's interpretation of the scope of that reservation.
Annex II. SCHEDULE OF CHILE
Sector: All
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5) Most-Favoured-Nation Treatment (Article 8.6)
Description: Investment
Chile reserves the right to adopt or maintain any measure relating to the ownership or control of land within five kilometres of the coastline that is used for agricultural activities. Such measure could include a requirement that the majority of each class of stock of a Chilean juridical person that seeks to own or control such land be held by Chilean persons or by persons residing in Chile for 183 days or more per year.
Existing Measures: Decree Law 1.939, Official Gazette, November 10, 1977, Rules for acquisition, administration and disposal of State owned assets, Title I (Decreto Ley 1.939, Diario Oficial, noviembre 10, 1977, Normas sobre adquisición, administración y disposición de bienes del Estado, Título I)
Sector: All
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5) Senior Management and Boards of Directors (Article 8.10)
Description: Investment
In the transfer or disposal of any interest in stock or asset held in an existing state enterprise or governmental entity, Chile reserves the right to prohibit or impose limitations on the ownership of said interest or asset and on the right of foreign investors or their investments to control any State company created thereby or investments made by the same. In connection with any such transfer or disposal, Chile may adopt or maintain any measure related to the nationality of senior management and members of the board of directors.
A “State company” (1) shall mean any company owned or controlled by Chile by means of an interest share in the ownership thereof, and it shall include any company created after the entry into force of this Agreement for the sole purpose of selling or disposing of its interest share in the capital or assets of an existing state enterprise or governmental entity.
Existing Measures:
Sector: All
Sub-Sector:
Obligations Concerned: Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure that accords differential treatment to countries under any bilateral or multilateral international agreement in force on, or signed prior to, the date of entry into force of this Agreement.
Chile reserves the right to adopt or maintain any measure that accords differential treatment to countries under any international agreement in force or signed after the date of entry into force of this Agreement involving:
(a) aviation;
(b) fisheries; or
(c) maritime matters, including salvage.
Existing Measures:
Sector: Communications
Sub-Sector: One way satellite broadcasting of digital telecommunication services, whether these involve direct home television broadcasting, direct broadcasting of television services and direct audio broadcasting; supplementary telecommunication services; and limited telecommunication services
Obligations Concerned: National Treatment (Article 9.3) Most-Favoured-Nation Treatment (Article 9.4) Local Presence (Article 9.5)
Description: Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure related to cross-border trade in one way satellite broadcasting of digital telecommunication services, whether these involve direct home television broadcasting, direct broadcasting of television services and direct audio broadcasting; supplementary telecommunication services; and limited telecommunication services.
Existing Measures: Law 18.168, Official Gazette, October 2, 1982, General Telecommunications Law, Titles I, II, III, V and VI (Ley 18.168, Diario Oficial, octubre 2, 1982, Ley General de Telecomunicaciones, Títulos I, II, III, V y VI)
Sector: Communications
Sub-Sector: One way satellite broadcasting of digital telecommunication services, whether these involve direct home television broadcasting, direct broadcasting of television services and direct audio broadcasting; supplementary telecommunication services; and limited telecommunication services
Obligations Concerned: National Treatment (Article 8.5) Most-Favoured-Nation Treatment (Article 8.6) Performance Requirements (Article 8.9) Senior Management and Boards of Directors (Article 8.10)
Description: Investment
Chile reserves the right to adopt or maintain any measure related to the investors of the other Party or to their investments in one way satellite broadcasting of digital telecommunication services, whether these involve direct home television broadcasting, direct broadcasting of television services and direct audio broadcasting; supplementary telecommunication services; and limited telecommunication services.
Existing Measures: Law 18.168, Official Gazette, October 2, 1982, General Telecommunications Law, Titles I, II, III, V and VI (Ley 18.168, Diario Oficial, octubre 2, 1982, Ley General de Telecomunicaciones, Títulos I, II, III, V y VI)
Sector: Issues Involving Minorities
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3) Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4) Performance Requirements (Article 8.9) Senior Management and Boards of Directors (Article 8.10) Local Presence (Article 9.5)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure according rights or preferences to socially or economically disadvantaged minorities.
Existing Measures:
Sector: Issues Involving Indigenous Peoples
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3) Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4) Performance Requirements (Article 8.9) Senior Management and Boards of Directors (Article 8.10) Local Presence (Article 9.5)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure according rights or preferences to indigenous peoples.
Existing Measures:
Sector: Education
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3) Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4) Performance Requirements (Article 8.9) Senior Management and Boards of Directors (Article 8.10) Local Presence (Article 9.5)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure relating to:
(a) investors and an investment of an investor of the other Party in education; and
(b) natural persons who supply educational services in Chile.
Subparagraph (b) includes teachers and auxiliary personnel supplying educational services in pre-school, kindergarten, special education, elementary, secondary or higher education, professional, technical or university education, and all other persons that supply services related to education, including sponsors of educational institutions of any kind, schools, lyceums, academies, training centres, professional and technical institutes or universities.
This reservation does not apply to investors and an investment of an investor of the other Party in kindergarten, pre-school, elementary or secondary private education institutions, that do not receive public resources, or to the supply of services related to second-language training, corporate, business, and industrial training and skill upgrading, which include consulting services relating to technical support, advice, curriculum, and programme development in education.
Existing Measures:
Sector: Government Finances
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5)
Description: Investment
Chile reserves the right to adopt or maintain any measure related to the acquisition, sale or disposal by the other Party’s nationals of bonds, treasury securities or any other type of debt instruments issued by the Central Bank of Chile (Banco Central de Chile) or the Government of Chile. This entry is not intended to affect the rights of the other Party’s financial institutions (banks) established in Chile to acquire, sell or dispose of such instruments when required for the purposes of regulatory capital.
Existing Measures:
Sector: Fisheries
Sub-Sector: Fishing related activities
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3) Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to control the activities of foreign fishing, including fish landing, first landing of fish processed at sea and access to Chilean ports (port privileges).
Chile reserves the right to control the use of beaches, land adjacent to beaches (terrenos de playas), water-columns (porciones de agua) and sea-bed lots (fondos marinos) for the issuance of maritime concessions. For greater certainty, “maritime concessions” do not cover aquaculture.
Existing Measures: Decree Law 2.222, Official Gazette, May 31, 1978, Navigation Law, Titles I, II, III, IV and V (Decreto Ley 2.222, Diario Oficial, mayo 31, 1978, Ley de Navegación Títulos I, II, III, IV y V) D.F.L. 340, Official Gazette, April 6, 1960, about Maritime Concessions (D.F.L. 340, Diario Oficial, abril 6, 1960, sobre Concesiones Marítimas)
Supreme Decree 660, Official Gazette, November 28, 1988, Maritime Concession Act (Decreto Supremo 660, Diario Oficial, noviembre 28, 1988, Reglamento de Concesiones Marítimas) Supreme Decree 123 of the Ministry of Economic Affairs, Development and Reconstruction, Vice-Ministry of Fishing, Official Gazette, August 23, 2004, On Use of Ports (Decreto Supremo 123 del Ministerio de Economía, Fomento y Reconstrucción, Subsecretaría de Pesca, Diario Oficial, agosto 23, 2004, Sobre Uso de Puertos)
Sector: Arts and Cultural Industries
Sub-Sector:
Obligations Concerned: Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure that accords differential treatment to countries under any existing or future bilateral or multilateral international agreement, with respect to arts and cultural industries, such as audio-visual cooperation agreements.
For greater certainty, government supported subsidy programmes for the promotion of cultural activities are not subject to the limitations or obligations of this Agreement.
For the purposes of this entry, “arts and cultural industries” includes:
(a) books, magazines, periodical publications, or printed or electronic newspapers, excluding the printing and typesetting of any of the foregoing;
(b) recordings of movies or videos;
(c) music recordings in audio or video format;
(d) printed music scores or scores readable by machines;
(e) visual arts, artistic photography and new media;
(f) performing arts, including theatre, dance and circus arts; and
(g) media services or multimedia.
Existing Measures:
Sector: Entertainment, Audio-visual and Broadcasting Services
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3)
Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4) Performance Requirements (Article 8.9)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure relating to:
(a) the organisation and presentation in Chile of concerts and musical performances;
(b) the distribution or display of movies or videos; and
(c) radio broadcasts aimed at the public in general, as well as all radio, television and cable television-related activities, satellite programming services and broadcasting networks.
Notwithstanding the above, Chile shall extend to the persons and investors of the other Party, and their investments, treatment no less favourable than that Party accords persons and investors of Chile, and their investments.
Existing Measures:
Sector: Social Services
Sub-Sector:
Obligations Concerned: National Treatment (Article 8.5 and Article 9.3) Most-Favoured-Nation Treatment (Article 8.6 and Article 9.4) Performance Requirements (Article 8.9) Senior Management and Boards of Directors (Article 8.10) Local Presence (Article 9.5)
Description: Investment and Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure with respect to the supply of public law enforcement and correctional services, and the following services to the extent that they are social services established or maintained for reasons of public interest: income security or insurance, social security or insurance, social welfare, education, public training, health care and child care.
Existing Measures:
Sector: Environmental Services
Sub-Sector:
Obligations Concerned: National Treatment (Article 9.3) Most-Favoured-Nation Treatment (Article 9.4) Local Presence (Article 9.5)
Description: Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure imposing the requirement that the production and distribution of drinking water, the collection and disposal of waste water and sanitation services, such as sewage systems, waste disposal and waste water treatment may only be supplied by juridical persons incorporated under Chilean law or created in accordance with the requirements established by Chilean law.
This entry shall not apply to consultancy services retained by the said juridical persons.
Existing Measures:
Sector: Construction Services
Sub-Sector:
Obligations Concerned: National Treatment (Article 9.3) Local Presence (Article 9.5)
Description: Cross-Border Trade in Services
Chile reserves the right to adopt or maintain any measure with respect to the supply of construction services by foreign juridical persons or legal entities.
These measures may include requirements such as residency, registration or any other form of local presence.
Existing Measures: