Title
Free Trade Agreement between the Government of the Republic of Peru and the Government of the Republic of Honduras
Preamble
The Government of the Republic of Peru, on the one hand, and the Government of the Republic of Honduras, on the other hand, have decided to:
STRENGTHEN the special ties of friendship and cooperation between them and promote regional economic integration;
ENCOURAGE the creation of a broader and safer market for goods and services produced in their respective territories;
PROMOTE a comprehensive economic development in order to reduce poverty;
Encourage the creation of new employment opportunities and improve working conditions and standards of living in their respective territories;
ESTABLISH clear and mutually beneficial rules governing their commercial exchange;
ENSURE a foreseeable legal and commercial framework for business and investment;
RECOGNIZE that the promotion and protection of investments of one Party in the territory of the other Party will contribute to the increase of the flow of investments and will stimulate commercial activity of mutual benefit;
AVOID distortions in their reciprocal trade;
PROMOTE the competitiveness of their companies in global markets;
FACILITATE trade by promoting efficient and transparent customs procedures that ensure predictability for its importers and exporters;
Stimulate creativity and innovation and promote trade in the innovative sectors of their economies;
PROMOTE transparency in international trade and investment;
PRESERVE its capacity to safeguard the public welfare; Y
DEVELOP their respective rights and obligations under the Marrakesh Agreement Establishing the World Trade Organization, as well as other treaties to which they are party,
HAVE AGREED as follows:
Body
Chapter 1. Initial Provisions and General Definitions
Section A. Initial Provisions
Article 1.1. Establishment of the Free Trade Area
The Parties to this Agreement, in accordance with the provisions of Article XXIV of the General Agreement on Tariffs and Trade 1994 of the WTO and Article V of the General Agreement on Trade in Services of the WTO, establish a free trade area.
Article 1.2. Objectives
The objectives of this Treaty are:
(A) to stimulate the expansion and diversification of trade between the Parties;
(B) eliminate unnecessary barriers to trade and facilitate the cross-border movement of goods and services between the Parties;
(C) promote free competition in the free trade area;
(D) increase investment opportunities in the territories of the Parties;
(E) adequately and effectively protect and enforce intellectual property rights in the territory of each Party, taking into account the balance between rights and obligations arising therefrom; and
(F) create effective procedures for the implementation and enforcement of this Agreement, for joint administration, and for the prevention and settlement of disputes.
Article 1.3. Relationship with other International Agreements
1. The Parties confirm the rights and obligations existing between them under the WTO Agreement and other agreements to which they are parties.
2. In the event of any inconsistency between this Agreement and the agreements referred to in paragraph 1, this Treaty shall prevail to the extent of its incompatibility, unless otherwise provided in this Treaty.
Article 1.4. Scope of Obligations
Each Party shall ensure the adoption of all measures necessary to comply with the provisions of this Treaty in its territory and at all levels of government.
Section B. General Definitions
Article 1.5. Definitions of General Application
For the purposes of this Agreement, unless otherwise specified:
TRIPS Agreement means the Agreement on Trade-Related Aspects of Intellectual Property Rights of the WTO (1);
WTO Anti-Dumping Agreement means the WTO Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994;
WTO Customs Valuation Agreement means the WTO Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994;
GATS of the WTO means the General Agreement on Trade in Services of the WTO;
WTO SPS Agreement means the Agreement on the Application of Sanitary and Phytosanitary Measures of the WTO;
WTO TBT Agreement means the WTO Agreement on Technical Barriers to Trade;
Agreement on the WTO means the Marrakesh Agreement establishing the World Trade Organization, dated 15 April 1994;
WTO Subsidies Agreement means the Agreement on Subsidies and Countervailing Measures of the WTO;
Customs tariff means any import tax or duty and a charge of any kind applied in connection with the importation of goods, including any form of surtax or charge additional to imports, except any:
(A) a charge equivalent to an internal tax established in accordance with Article III.2 of the GATT 1994;
(B) anti-dumping or countervailing duty applicable in accordance with the domestic law of a Party and in accordance with Article VI of the GATT 1994, the WTO Agreement on Subsidies and Countervailing Measures and the Agreement on the Application of the Article VI of the GATT 1994 of the WTO; or
(C) duty or other charge related to importation, proportional to the cost of the services rendered;
Customs authority means the competent authority which, under the law of a Party, is responsible for the administration and enforcement of customs laws and regulations:
(A) in the case of Honduras, the Executive Directorate of Revenue (DEI);
(B) in the case of Peru, the National Superintendence of Customs and Tax Administration (SUNAT),
Or their successors;
Chapter means the first two digits of the Harmonized System tariff classification number;
Commission means the Free Trade Commission established under Article 17.1 (The Free Trade Commission);
Public procurement means the process by which a government acquires the use of or acquires goods or services, or any combination thereof, for governmental purposes and not for commercial sale or resale or for use in the production or supply of Goods or services for commercial sale or resale;
Days means calendar days;
Means any entity incorporated or organized in accordance with applicable law, whether or not for profit, or private or governmental property, including corporations, trusts, holdings, sole proprietorships, joint ventures, and other forms of association;
GATT 1994 means the General Agreement on Tariffs and Trade 1994 of the WTO;
Measure includes any law, regulation, procedure, requirement or practice;
Merchandise means any product, article or material;
Goods of a Party means domestic products as understood in the GATT 1994 or such goods as the Parties agree to, and includes goods originating in that Party;
Original merchandise means that it qualifies in accordance with the rules of origin established in Chapter 3 (Rules of Origin and Procedures of Origin);
National means a natural person having the nationality of a Party in accordance with Annex 1.5 or a permanent resident of a Party;
Central level of government means the national level of government;
Local level of government means:
(A) in the case of Honduras: the municipalities; and
(B) in the case of Peru: provincial and local municipalities;
Regional level of government means:
(A) in the case of Honduras: "regional level of government" is not applicable; and
(B) in the case of Peru: regional government in accordance with the Political Constitution of Peru and other applicable legislation;
WTO means the World Trade Organization;
Party means the Republic of Peru, on the one hand, and the Republic of Honduras, on the other hand, jointly referred to as the Parties;
Departure means the first four digits of the Harmonized System tariff classification number;
Person means a natural person or a company;
Harmonized System or SA means the Harmonized Commodity Description and Coding System, including its General Interpretation Rules, Section Notes and Chapter Notes;
Subheading means the first six digits of the tariff classification number under the Harmonized System; Y
Territory means, for a Party, the territory of that Party as set out in Annex 1.5.
Attachments
For the purposes of this Agreement, unless otherwise specified in this Agreement:
Natural person having the nationality of a Party means:
(A) in the case of Honduras, a Honduran as defined in Articles 23 and 24 of the Constitution of the Republic of Honduras; Y
(B) in the case of Peru, Peruvians by birth, naturalization or option in accordance with the provisions of the Political Constitution of Peru and domestic legislation in the matter;
Territory 2 means:
(A) in the case of Honduras, terrestrial, maritime and air space under its sovereignty, as well as its exclusive economic zone and its continental shelf, on which it exercises sovereign rights and jurisdiction, in accordance with International Law and its Internal Law; Y
(B) in the case of Peru, the mainland, islands, maritime areas and airspace that covers them, under the sovereignty or rights of sovereignty and jurisdiction of Peru, in accordance with the provisions of the Political Constitution of Peru, Other rules of its domestic law and international law.
(2) For greater certainty, the definition and references to "territory" contained in this Agreement apply exclusively for purposes of determining the geographical scope of application of the same.
Chapter 12. Investment
Section A. Substantive Obligations
121:.
1. This Chapter shall apply to measures adopted or maintained by a Party relating to:
(A) investors of the other Party;
(B) covered investments; and
(C) with respect to Articles 12.6 and 12.8, all investments in the territory of the Party.
2. The obligations of a Party under this Section shall apply to a State enterprise or other person when it exercises a regulatory, administrative or other governmental authority which has been delegated to it by that Party, such as the authority to expropriate, grant licenses, Approve business transactions or impose fees, fees or other charges.
3. For the greater certainty, the provisions of this Chapter do not bind a Party in relation to any act or fact that took place prior to the date of entry into force of this Agreement.
4. For the sake of certainty, nothing in this Chapter shall be construed to impose an obligation on a Party to privatize any investment it holds or controls, or to prevent a Party from designating a monopoly.
5. Nothing contained in this Chapter shall require any Party to protect investments made with capital or assets derived from illegal activities and shall not be construed to prevent a Party from adopting or maintaining measures aimed at preserving public order, Fulfill their duties to maintain or restore international peace and security or protection of their own essential security interests.
6. In the event of any incompatibility between this Chapter and another Chapter of this Agreement, the other Chapter shall prevail to the extent of the incompatibility.
7. The requirement of a Party that a service supplier of the other Party provides a security or other form of financial security as a condition for providing a cross-border service does not in itself make this Chapter applicable to the measures adopted Or maintained by the Party with respect to the cross-border supply of the service. This Chapter applies to measures taken or maintained by the Party in respect of the guarantee or financial guarantee, to the extent that such security or financial guarantee constitutes a covered investment.
8. This Chapter does not apply to measures that a Party adopts or maintains in respect of investors of the other Party and the investments of such investors in financial institutions in the territory of the Party.
(1) For greater certainty, this Chapter is subject to and will be interpreted in accordance with Annexes 12.4, 12.10, 12.15 and 12.21.
122:. National Treatment
1. Each Party shall accord to investors of the other Party treatment no less favorable than that it grants, in like circumstances, to its own investors in connection with the establishment, acquisition, expansion, administration, conduct, operation and sale or other disposition Of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favorable than that it grants in similar circumstances to the investments of its own investors in connection with the establishment, acquisition, expansion, administration, conduct, operation and sale or other disposition Of investments in its territory.
123:. Most-favored-nation Treatment
1. Each Party shall accord to investors of the other Party treatment no less favorable to investors of a non-Party in connection with the establishment, acquisition, expansion, administration, conduct, operation and sale or other investments in its territory.
2. Each Party shall accord to the investments covered a treatment which is no less favorable than those of an Investor in a non-Party with respect to the establishment, acquisition, expansion, administration, conduct, operation and sale or other
Investments in its territory.
3. For greater certainty, treatment with respect to the establishment, acquisition, expansion, administration, conduct, operation and sale or other form of investment disposition, referred to in paragraphs 1 and 2, does not include dispute settlement mechanisms, such as The one mentioned in Section B, which are established in international treaties, including trade or investment agreements.
124:. Minimum Level of Treatment (2)
1. Each Party shall accord to covered investments a treatment consistent with customary international law, including fair and equitable treatment, as well as full protection and security.
2. For greater certainty, paragraph 1 prescribes that the minimum level of treatment of foreigners under customary international law is the minimum level of treatment that can be provided to covered investments. The concepts of "fair and equitable treatment" and "full protection and security" do not require additional treatment or beyond that required by that standard and do not create significant additional rights. The obligation in paragraph 1 to provide:
(A) "fair and equitable treatment" includes the obligation not to deny justice in criminal, civil or administrative proceedings, in accordance with the principle of due process incorporated into the principal legal systems of the world; and
(B) "full protection and security" requires each Party to provide the level of police protection required by customary international law.
3. The determination that another provision of this Agreement or of any other international agreement has been violated does not establish that this Article has been violated.
(2) For greater certainty, Article 12.4 shall be interpreted in accordance with Annex 12.4.
125:.
"Senior Executives and Boards of Directors
1. No Party may require an enterprise of that Party, which is a covered investment, to appoint natural persons of a particular nationality to hold senior management positions.
2. A Party may require that a majority of the members of the boards of directors or any committee thereof, of an enterprise of that Party which is a covered investment, be of a particular nationality or resident in the territory of the Party, Provided that the requirement does not significantly impair the ability of the investor to exercise control over its investment.
126:. Performance Requirements
1. No Party may, in relation to the establishment, acquisition, expansion, administration, conduct, operation, sale or other disposition of an investment of an investor of a Party or of a non-Party in its territory, impose or enforce any requirement or enforce any obligation or commitment of: (3)
(A) export a certain level or percentage of goods or services;
(B) achieve a certain degree or percentage of national content;
(C) purchase, use or give preference to goods produced in its territory, or purchase goods from persons in its territory;
(D) relate in any way the volume or value of imports with the volume or value of exports, or the amount of the foreign exchange inflows associated with such investment;
(E) restrict the sales in its territory of the goods or services that such investment produces or lends, relating in any way such sales to the volume or value of its exports or to the profits generated in foreign currency;
(F) transfer a particular technology, production process or other knowledge of its property to a person in its territory, except when the requirement is imposed or the obligation or commitment is enforced by a court or administrative court or a competition authority, To remedy a practice that has been determined following a judicial or administrative proceeding as anticompetitive under the competition laws of Part (4); or
(G) provide exclusively for the territory of a Party the goods produced by the investment or services it provides for a specific regional market or the world market.
2. A measure requiring an investment to use a technology to comply with general regulations applicable to health, safety or the environment shall not be considered incompatible with paragraph 1 (f).
3. Paragraph 1 (f) does not apply where a Party authorizes the use of an intellectual property right in accordance with Article 31 (5) of the WTO TRIPS Agreement or measures requiring the disclosure of falling property information within the scope of, and are compatible with, Article 39 of the WTO TRIPS Agreement. (6)
4. For the sake of certainty, nothing in paragraph 1 shall be construed to prevent a Party, in connection with the establishment, acquisition, expansion, administration, conduct, operation or sale or other disposition of a covered investment or investment of a Investor of a non-Party in its territory that imposes or enforces a requirement or enforces an obligation or commitment to train workers in its territory.
5. No Party may condition the receipt of an advantage or continue to receive an advantage in connection with the establishment, acquisition, expansion, administration, conduct, operation, sale or other disposition of an investment in its territory by an investor of a Party or of a non-Party, to the fulfillment of any of the following requirements:
(A) achieve a certain degree or percentage of national content;
(B) to purchase, use or grant preferences to goods produced in its territory or to purchase goods from persons in its territory;
(C) relate, in any form, the volume or value of imports with the volume or value of exports, or the amount of the foreign exchange inflows associated with such investment; or
(D) restricting sales in its territory of the goods or services that such investment produces or lends, relating in any way such sales to the volume or value of its exports or to profits generated in foreign currency.
6. Nothing in paragraph 5 shall be construed as an impediment for a Party to condition the receipt of an advantage or to continue to receive an advantage in connection with an investment in its territory by an investor of a Party or A non-Party, to the fulfillment of a requirement to locate production, provide services, train or employ workers, construct or expand particular facilities or conduct research and development in its territory.
7. Paragraphs 1 and 5 shall not apply to any requirements other than the commitment, obligation or requirements identified in those paragraphs.
8. The provisions of:
(A) Subparagraphs 1 (a), (b) and (c), and 5 (a) and (b) shall not apply to the qualification requirements for goods or services with respect to export promotion programs and external aid programs; and
(B) Subparagraphs 5 (a) and (b) shall not apply to requirements imposed by an importing Party with respect to the contents of the goods necessary to qualify for preferential tariffs or quotas.
9. Provided that such measures are not applied in an arbitrary or unjustified manner and provided that such measures do not constitute a disguised restriction on international trade or investment, nothing in subparagraphs 1 (b), (c) and (f) and 5 (a) and
(B) shall be construed to prevent a Party from adopting or maintaining measures, including those of an environmental nature:
(A) necessary to ensure compliance with laws and regulations that are not inconsistent with the provisions of this Agreement;