(c) debt instruments of a company:
(i) when the company is a subsidiary of the investor, or
(ii) when the original maturity date of the debt instrument is at least three (3) years,
but does not include an obligation of a Party or a State enterprise, regardless of the original maturity date;
(d) a loan to a company:
(i) when the company is a subsidiary of the investor, or
(ii) when the original maturity date of the loan is at least three (3) years,
but does not include a loan to a Party or a State enterprise, regardless of the original maturity date;
(e) futures, options and other derivatives;
(f) tumkey, construction, management, production, concession, revenue sharing and other similar contracts;
(g) intellectual property rights;
(h) licenses, authorizations, permits and similar rights granted in accordance with national legislation (11); and
(i) other tangible or intangible, movable or immovable property rights and rights related to property, such as leases, mortgages, liens and pledges,
but investment does not include:
(j) an order or judgment entered in a judicial or administrative action;
(k) loans granted by one Party to the other Party;
(I) public debt operations and debt of public institutions;
(m) pecuniary claims arising exclusively from:
(i) commercial contracts for the sale of goods or services by a national or company in the territory of a Party to a national or company in the territory of the other Party; or
(ii) the extension of credit in connection with a commercial transaction, such as trade financing, other than a loan covered by the provisions of subparagraph (d); or
(n) any other pecuniary claim, which does not carry the interest rates set forth in subparagraphs (a) through (i),
a modification in the manner in which the assets have been invested or reinvested does not affect their investment status under this Agreement, provided that such modification falls within the definitions of this Article and is made in accordance with the domestic law of the Party into whose territory the investment has been admitted;
covered investment means, with respect to a Party, an investmentin its territory of an investor of the other Party existing on the date of entry into force of this Agreement, as well as investments made, acquired or expanded thereafter;
investor of a non-Party means, with respect to a Party, an investor that intends to make, through specific actions (12), that is making or has made an investment in the territory of that Party, that is not an investor of a Party,
investor of a Party means a Party or an enterprise of the State of the Party, or a national or enterprise of the Party, that intends to make, through specific actions (13), is making or has made an investment in the territory of the other Party; provided, however, that a natural person who has dual nationality shall be considered exclusively a national of the State of his or her dominant and effective nationality;
measure includes any law, regulation, procedure, requirement, act or practice;
freely usable currency means "freely usable currency" as determined by the Intemational Monetary Fund under the Articles of Agreement of the Intemational Monetary Fund;
national means a natural person who has the nationality of a Party in accordance with Annex 1.5 (Country- Specific Definitions);
disputing party means the plaintiff or the defendant, disputing parties means the plaintiff and the defendant,
non-disputing party means a person of a Party, or a person of a non-Party with a significant presence in the territory of a Party, that is not a party to an investment dispute under Section B;
UNCITRAL Arbitration Rules means the Arbitration Rules of the United Nations Commission on Intemational Trade Law, adopted by the General Assembly of the United Nations on December 15, 1976;
ICSID Additional Facility Rules means the ICSID Additional Facility Rules for the Administration of Proceedings by the ICSID Secretariat,
Secretary-General means the Secretary-General of ICSID; and
tribunal means an arbitral tribunal established under Article 12.20 or 12.26.
Annex 12.4 . Customary International Law
The Parties confirm their common understanding that customary intemational law, generally and as specifically referred to in Article 12.4, results from a general and consistent practice of States, followed by them in the sense of a legal obligation. With respect to Article 12.4, the minimum standard of treatment accorded to aliens by customary intemational law refers to all principles of customary international law that protect the economic rights and interests of aliens.
Annex 12.10 . Expropriation
The Parties confirm their common understanding that:
(a) a measure or series of measures of a Party cannot constitute an expropriation unless it interferes with a tangible or intangible property right or with the essential attributes or powers of ownership of an investment,
(b) Article 12.10 addresses two situations. The first is direct expropriation, where an investment is nationalized or otherwise directly expropriated through the formal transfer of title or right of ownership;
(c) the second situation addressed by Article 12.10 is indirect expropriation, where a measure or series of measures by a Party has an effect equivalent to that of a direct expropriation without the formal transfer of title or right of ownership;
(d) the determination of whether a measure or series of measures of a Party, in a specific factual situation, constitutes an indirect expropriation requires a factual, case-by-case inquiry that considers, among other factors:
(i) the economic impact of a Party's measure or series of measures, although the mere fact that a measure or series of measures of a Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred;
(ii) the extent to which a Party's measure or series of measures interferes with unambiguous and reasonable expectations of the investment, and
(iii) the nature of a Party's measure or series of measures;
(e) except in exceptional circumstances, such as where a measure or series of measures are disproportionate in light of their objective such that they cannot reasonably be considered to have been adopted and applied in good faith, non-discriminatory regulatory actions by a Party that are designed and applied to protect legitimate public welfare objectives, such as public health, safety and the environment, do not constitute an indirect expropriation (14).
Annex 12.15 . Delivery of Documents to a Party under Section B (Investor - State Dispute Settlement)
Notices and other documents in disputes under Section B shall be served by delivery to:
(a) Costa Rica:
General Directorate of Foreign Trade Ministry of Foreign Trade
Paseo Colón, Avenida 1era y 3era, Calle 40 San José, Costa Rica; and
(b) Peru:
Directorate General for Intemational Economic, Competition and Private Investment Affairs
Ministry of Economy and Finance Jir6én
Lampa # 277 Sth Floor
Lima 1, Peru,
or their successors.
Annex 12.21 . Communications from Non-Disputing Parties
1. An application for leave to file the written submissions of a non-disputing party shall be filed within the time limit set by the tribunal and shall:
(a) be in writing, dated and signed by the applicant, and include the applicant's address and other contact details;
(b) be no longer than five (5) pages;
(c) describe the applicant, including, where relevant, its membership status, as well as its legal status (e.g., corporation, trade association or other non-governmental organization), its general objectives, the nature of its activities, and any parent organization (including any organization that the applicant directly or indirectly controls);
(d) disclose whether the applicant has any affiliation, directly or indirectly, with any disputing party,
(e) identify any govemment, person or organization that provided financial or other assistance during the preparation of the submission;
(f) specify the nature of the applicant's interest in the arbitration;
(g) identify the specific factual or legal issues in the arbitration to which the applicant will refer in its written communication;
(h) be drafted in the language of the arbitration.
2. The written communication from a non-disputing party shall:
{a) The deadline set by the courtis the deadline set by the court,
(b) dated and signed by the applicant,
(c) be concise and in no case shall exceed twenty (20) pages, including annexes and appendices;
(d) duly substantiate its position; and
(e) only make reference to the subjects indicated in its application, in accordance with subparagraph 1 (g).
Chapter 13. Cross-Border Trade In Services
Article 13.1. Scope of Application
1. This Chapter applies to measures adopted or maintained by a Party affecting cross-border trade in services supplied by service suppliers of the other Party. Such measures include measures affecting:
(a) the production, distribution, marketing, sale and supply of a service;
(b) the purchase or use of, or payment for, a service;
(c) access to and use of distribution and transportation systems, or telecommunications networks and services related to the supply of a service;
(d) the presence in its territory of a service supplier of the other Party, and
(e) the provision of a bond or other form of financial guarantee as a condition for the provision of a service.
2. For the purposes of this Chapter, measures adopted or maintained by a Party means measures adopted or maintained by:
(a) central, regional or local govemments or authorities; and
(b) non-govemmental institutions in the exercise of powers delegated to them by central, regional or local governments or authorities.
3. This Chapter does not apply to:
(a) air services (1) , including domestic and international air transport services, scheduled and non-scheduled, as well as related support services for air services, except:
(i) aircraft repair and maintenance services while the aircraft is out of service;
(ii) the sale and marketing of air transportation services; and
(iii) computerized reservation system (CRS) services;
(b) public procurement, and
(c) subsidies or grants provided by a Party, including govemment-supported loans, guarantees and insurance.
4. Articles 13.2, 13.5, 13.9 and 13.10 shall apply to measures of a Party that affect the supply of a service in its territory by a covered investment (2).
5. This Chapter does not impose any obligation on a Party with respect to a national of the other Party who seeks to enter its labor market or who has permanent employment in its territory, or to confer any rights on that national with respect to such access or employment, nor shall it apply to measures relating to citizenship or residence on a permanent basis.
6. Nothing in this Chapter shall be construed to impose any obligation on a Party with respect to its immigration measures.
7. This Chapter does not apply to services supplied in the exercise of govemmental authority. A service supplied in the exercise of governmental authority means any service that is supplied neither on a commercial basis nor in competition with one or more service suppliers.
8. This Chapter does not apply to measures affecting the supply of financial services (3) as defined in paragraph 5(a) of the GATS Annex on Financial Services.
Article 13.2. Subsidies
Notwithstanding Article 13.1.3(c), if the results of the negotiations related to Article XV.1 of the WTO GATS enter into force for each Party, this Article shall be reviewed jointly, as appropriate, with a view to determining whether this Article should be modified so that those results are incorporated into this Agreement. The Parties agree to coordinate such negotiations, as appropriate.
Article 13.3. National Treatment
Each Party shall accord to service suppliers of the other Party treatment no less favorable than that it accords, in like circumstances, to its service suppliers.
Article 13.4. Most-Favored-Nation Treatment
Each Party shall accord to service suppliers of the other Party treatment no less favorable than that it accords, in like circumstances, to service suppliers of a non-Party.
Article 13.5. Market Access
No Party may adopt or maintain, on the basis of a regional subdivision or its entire territory, measures that:
(a) impose limitations on:
(i) the number of service providers, whether in the form of numerical quotas, monopolies or exclusive service providers or by requiring an economic needs test,
(ii) the total value of assets or service transactions in the form of numerical quotas or by requiring an economic needs test,
(iii) the total number of service operations or the total amount of service output, expressed in designated numerical units, in the form of quotas or by requiring an economic needs test (4);
(iv) the total number of natural persons who may be employed in a given service sector or who may be employed by a service supplier and who are necessary for and directly related to the supply of a specific service, in the form of numerical quotas or through the requirement of an economic needs test, or
(b) restrict or prescribe the specific types of legal entity or joint venture through which a service supplier may supply a service.
Article 13.6. Local Presence
No Party may require a service supplier of the other Party to establish or maintain a representative office or other form of enterprise, or to reside in its territory, as a condition for the cross-border supply of a service.
Article 13.7. Nonconforming Measures
1. Articles 13.3, 13.4, 13.5 and 13.6 do not apply to:
(a) any existing non-conforming measure maintained by a Party in:
(i) the central level of goverment, as stipulated by that Party in its Schedule to Annex I;
(ii) a regional level of goverment, as specified by that Party in its Schedule to Annex I; or
(iii) a local level of goverment,
(b) the continuation or prompt renewal of any nonconforming measure referred to in subparagraph (a); or
(c) the modification of any non-conforming measure referred to in subparagraph (a), provided that such modification does not diminish the conformity of the measure, as in effect immediately before the modification, with Articles 13.3, 13.4, 13.5 or 13.6.
2. Articles 13.3, 13.4, 13.5 and 13.6 do not apply to any measures that a Party adopts or maintains in relation to sectors, subsectors or activities as set out in its Schedule to Annex II.
Article 13.8. Notification (5)
1. In the event that a Party makes an amendment or modification to any existing non-conforming measure set out in its Schedule to Annex I, in accordance with Article 13.7.1(c), the Party shall notify the other Party, as soon as practicable, of such amendment or modification.
2. In the event that a Party adopts a measure after the entry into force of this Agreement with respect to the sectors, subsectors or activities set out in its Schedule to Annex Il, the Party shall, to the extent possible, notify the other Party of such measure.
Article 13.9. Transparency In the Development and Application of the Regulations (6)
In addition to Chapter 16 (Transparency):
(a) each Party shall establish or maintain appropriate mechanisms for responding to inquiries from interested persons conceming its regulations relating to matters covered by this Chapter (7);
(b) at the time of adopting final regulations relating to the subject matter of this Chapter, each Party shall respond in writing, to the extent practicable, including upon request, to substantive comments received from interested persons with respect to the proposed regulations; and
(c) to the extent possible, each Party shall allow a reasonable period of time between the publication of final regulations and the date on which they enter into force.
Article 13.10. National Regulations
1. The Parties shall ensure that all measures of general application to which this Chapter applies are administered in a reasonable, objective and impartial manner. This obligation shall not apply to measures covered by Annex I or to measures covered by Annex II of each Party.
2. Where a Party requires authorization for the supply of a service, the competent authorities of that Party shall, within a reasonable period of time after the submission of an application considered complete in accordance with its domestic laws and regulations, inform the applicant of the decision regarding its application. At the request of such applicant, the competent authorities of the Party shall, without undue delay, provide information conceming the status of the application. This obligation shall not apply to authorization requirements covered by Article 13.7.2.
3. In order to ensure that measures relating to qualification requirements and procedures, technical standards and licensing requirements do not constitute unnecessary barriers to trade in services, each Party shall endeavor to ensure, in a manner appropriate to each individual sector, that such measures do not constitute unnecessary barriers to trade in services:
(a) based on objective and transparent criteria, such as competence and ability to provide the service;
(b) are not more burdensome than necessary to ensure quality of service; and
(c) in the case of licensing procedures, do not in themselves constitute a restriction on the supply of the service.
4. The Parties recognize their mutual obligations relating to domestic regulation in Article VI.4 of the WTO GATS and affirm their commitment to the development of any necessary disciplines under Article VI.4. To the extent that any such disciplines are adopted by WTO Members, the Parties shall jointly review them, as appropriate, with a view to determining whether this Article should be modified, so that such results may be incorporated into this Agreement.
Article 13.11. Mutual Recognition
1. For the purposes of complying, in whole or in part, with its standards or criteria for the authorization or certification of service suppliers or the licensing of service suppliers, and subject to the requirements of paragraph 4, a Party may recognize education or experience obtained, requirements met, or licenses or certificates granted in a particular country. Such recognition, which may be effected through harmonization or otherwise, may be based on an agreement or arrangement with the country concemed or may be granted autonomously.