Neither Party shall have recourse to dispute settlement under this Agreement for any matter arising in this Section.
Chapter 6. Trade Remedies
Section A. Safeguard Measures
Article 6.1. Application of a Safeguard Measure
If, as a result of the reduction or elimination of a customs duty under this Agreement, an originating good of the other Party is being imported into the territory of a Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to be a substantial cause of serious injury, or threat thereof, to a domestic industry producing a like or directly competitive good, the Party may:
(a) suspend the further reduction of any rate of customs duty on the good provided for under this Agreement;
(b) increase the rate of customs duty on the good to a level not to exceed the lesser of:
(i) the most-favoured-nation (hereinafter referred to as "MFN") applied rate of duty on the good in effect at the time the safeguard measure is applied; and
(ii) the MFN applied rate of duty on the good in effect on the day immediately preceding the date of entry into force of this Agreement; or
(c) in the case of a customs duty applied to a good on a seasonal basis, increase the rate of duty to a level that, for each season, does not exceed the lesser of:
(i) the MFN applied rate of duty on the good in effect for the corresponding season immediately preceding the date of application of the safeguard measure; and
(ii) the MFN applied rate of duty on the good in effect for the corresponding season immediately preceding the date of entry into force of this Agreement.
Article 6.2. Conditions and Limitations
1. A Party shall apply a safeguard measure only following an investigation by the Party's competent authorities in accordance with the procedures and requirements provided for in Article 3 and 4.2 of the Safeguards Agreement, and to this end, Articles 3 and 4.2 of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis.
2. A Party shall notify the other Party in writing upon initiation of an investigation described in paragraph 1 and shall consult with the other Party as far in advance of applying a safeguard measure as practicable, with a view to reviewing the information arising from the investigation and exchanging views on the safeguard measure.
3. Each Party shall ensure that its competent authorities complete any such investigation within one year of the date of its initiation.
4. Neither Party shall apply or maintain a safeguard measure:
(a) except to the extent, and for such time, as may be necessary to prevent or remedy serious injury and to facilitate adjustment;
(b) for a period exceeding two years, except that the period may be extended by up to one year if the competent authorities of the applying Party determine, in conformity with the procedures specified in this Article, that the safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the industry is adjusting, provided that the total period of application of a safeguard measure, including the period of initial application and any extension thereof, shall not exceed three years; or
(c) beyond the expiration of the transition period, except with the consent of the other Party.
5. Neither Party shall apply a safeguard measure more than once against the same good.
6. No safeguard measure or provisional safeguard measure shall be applied against a particular good while a global safeguard measure under Article XIX of GATT 1994 and the Safeguards Agreement in respect of that good is in place. In the event that a global safeguard measure is taken in respect of a particular good, any existing safeguard measure or provisional safeguard measure which is taken against that good in accordance with this Section shall be terminated.
7. Where the expected duration of a safeguard measure is over one year, the applying Party shall progressively liberalise it at regular intervals.
8. When a Party terminates a safeguard measure, the rate of customs duty shall be the rate that, in accordance with the Party's Schedule to Annex 2-A (Elimination of Customs Duties), would have been in effect but for the safeguard measure.
Article 6.3. Provisional Safeguard Measure
1. In critical circumstances where delay would cause damage that would be difficult to repair, a Party may apply a provisional safeguard measure in accordance with a preliminary determination by its competent authorities that there is clear evidence that imports of an originating good from the other Party have increased as the result of the reduction or elimination of a customs duty under this Agreement, and have become a substantial cause of serious injury, or threat thereof, to its domestic industry.
2. Before applying a provisional safeguard measure the applying Party shall notify the other Party and shall immediately initiate consultations after applying the provisional safeguard measure.
3. The duration of any provisional safeguard measure shall not exceed 200 days, during which time the applying Party shall comply with the requirements of Article 6.2.1.
4. The applying Party shall promptly refund any additional customs duties collected as a result of a provisional safeguard measure if the investigation conducted in accordance with Article 6.2.1 does not result in a finding that the requirements of Article 6.1 have been met. The duration of any provisional measure shall be counted as part of the period described in Article 6.2.4(b).
Article 6.4. Compensation
1. No later than 30 days after it applies a safeguard measure, a Party shall afford an opportunity for the other Party to consult with it regarding appropriate trade liberalising 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 safeguard measure. The applying Party shall provide such compensation as the Parties mutually agree.
2. If the Parties are unable to agree on compensation within 30 days after consultations begin in accordance with paragraph 1, the Party against whose originating good the safeguard measure is applied may suspend the application of concessions with respect to originating goods of the applying Party that have trade effects substantially equivalent to the safeguard measure.
3. The applying Party's obligation to provide compensation under paragraph 1 and the other
Party's right to suspend concessions in accordance with paragraph 2 shall terminate on the date the safeguard measure terminates.
Article 6.5. Global Safeguard Measures
Each Party retains its rights and obligations under Article XIX of GATT 1994 and the Safeguards Agreement and the Agreement on Agriculture. This Agreement shall not confer any additional rights or impose any additional obligations on the Parties with respect to measures applied under Article XIX of GATT 1994 and the Safeguards Agreement or the Agreement on Agriculture, except that a Party applying such a measure under Article XIX of GATT 1994 and the Safeguards Agreement may exclude imports of an originating good of the other Party, from the measure.
Article 6.6. Definitions
For the purposes of Section A:
Agreement on Agriculture means the Agreement on Agriculture, in Annex 1A of the WTO Agreement;
domestic industry means, with respect to an imported good, the producers as a whole of the like or directly competitive good operating in the territory of a Party, or those whose collective output of the like or directly competitive good constitutes a major proportion of the total domestic production of that good;
safeguard measure means a measure described in Article 6.1;
serious injury means a significant overall impairment in the position of a domestic industry;
substantial cause means the dominant cause that contributes more than any other individual cause;
threat of serious injury means serious injury that, on the basis of facts and not merely on allegation, conjecture, or remote possibility, is clearly imminent; and
transition period in relation to a particular good means the period from the date of entry into force of this Agreement until five years after the date of the elimination or the completion of the reduction period of the customs duties in accordance with that Party's schedule of tariff commitments in Annex 2-A (Elimination of Customs Duties).
Section B. Agricultural Safeguard Measures
Article 6.7. Agricultural Safeguard Measures
1. Notwithstanding Article 2.3 (Elimination of Customs Duties), a Party may apply an agricultural safeguard measure on an originating agricultural good listed in that Party's Schedule to Annex 6-A, if the aggregate volume of imports of that good in any calendar year exceeds a trigger level set out in that Party's Schedule to Annex 6-A.
2. The duty to be applied as the agricultural safeguard measure under paragraph 1 shall not exceed the lesser of:
(a) the prevailing MFN applied rate;
(b) the MEN applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement; or
(c) the duty rate set out in the applying Party's Schedule to Annex 6-A.
3. Neither Party shall maintain an agricultural safeguard measure under this Article beyond the end of the calendar year in which it has applied the measure.
4. Neither Party shall apply or maintain an agricultural safeguard measure on an originating agricultural good if the period specified in the agricultural safeguard provisions of the Party's Schedule to Annex 6-A has expired.
5. Neither Party shall apply or maintain an agricultural safeguard measure under this Article and at the same time apply or maintain, on the same good:
(a) a safeguard measure under this Agreement;
(b) a measure under Article XIX of GATT 1994 and the Safeguards Agreement; or
(c) a safeguard measure applied under the Agreement on Agriculture.
6. A Party shall implement agricultural safeguard measures in a transparent manner. Within 60 days after applying a measure, the Party applying an agricultural safeguard measure shall notify the other Party in writing and provide it with relevant data concerning the measure including trade volumes. On request, the Party applying the agricultural safeguard measure shall consult with the other Party with respect to the conditions of the application of such agricultural safeguard measure.
7. A good which is en route on the basis of a contract settled before the agricultural safeguard measure is applied shall be exempted from the application of the safeguard measure provided that it may be counted in the volume of imports of the good in question during the following calendar year for the purposes of triggering the provisions of paragraph 1 in that calendar year.
8. The implementation and operation of this Article may be the subject of discussion and review in the Committee on Trade in Goods.
Section C. Anti-dumping and Countervailing Measures
Article 6.8. Anti-dumping and Countervailing Measures
1. Each Party retains its rights and obligations under the WTO Agreement with regard to the application of anti-dumping and countervailing measures. Unless otherwise provided in this Chapter, nothing in this Agreement shall be construed to confer any additional rights or impose any additional obligations on a Party with respect to anti-dumping or countervailing measures.
2. In order to enhance transparency in the implementation of the WTO Agreement:
(a) the Parties confirm their current practice of counting toward the average all individual margins, whether positive or negative, when anti-dumping margins are established on the weighted-to-weighted basis or transaction-to-transaction basis, or weighted-to-transaction basis, and share their expectation that such practice will continue; and
(b) the Party making such a decision to impose an anti-dumping duty in accordance with Article 9.1 of the Anti-Dumping Agreement, shall normally apply the ‘lesser duty' rule, by imposing a duty which is less than the dumping margin where such lesser duty would be adequate to remove the injury to the domestic industry.
Article 6.9. Notification and Consultations
1. After receipt by a Party's competent authorities of a properly documented anti-dumping application relating to imports from the other Party and before proceeding to initiate an investigation, the Party shall give written notice, at the earliest possible opportunity, to the other Party and, immediately after initiating an investigation, shall afford the other Party an adequate opportunity to make inquiries and representations regarding the application.
2. As soon as possible after an application for countervailing measures is accepted by the competent authorities of a Party and before the initiation of an investigation, if products of the
other Party may be subject to such investigation, the other Party shall be invited for consultations with the aim of clarifying the situation and arriving at a mutually agreed solution.
Article 6.10. Undertakings
1. After a Party's competent authorities initiate an anti-dumping or countervailing duty investigation, that Party shall give written notice, which shall include information about the availability of undertakings, to the other Party.
2. In an anti-dumping investigation, where a Party's competent authorities have made a preliminary affirmative determination of dumping and injury caused by such dumping, that Party shall, to the extent possible, inform exporters of the other Party about the availability of undertakings and extend reasonable consideration to undertakings requested by the exporters of the other Party.
3. In a countervailing duty investigation, where a Party's competent authorities have made a preliminary affirmative determination of subsidisation and injury caused by such subsidisation, that Party shall inform the other Party and to the extent possible exporters of the other Party, about the availability of undertakings and extend reasonable consideration to undertakings requested by the other Party or the exporters of the other Party.
Chapter 7. Cross-border Trade In Services
Article 7.1. Scope
1. This Chapter shall apply to measures adopted or maintained by a Party affecting cross- border trade in services by service suppliers of the other Party. Such measures include measures affecting:
(a) the production, distribution, marketing, sale or delivery of a service;
(b) the purchase or use of, or payment for, a service;
(c) the access to and use of distribution, transport, or telecommunications networks and services in connection with 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 security as a condition for the supply of a service.
2. Articles 7.4, 7.7, and 7.8 shall also apply to measures adopted or maintained by a Party affecting the supply of a service in its territory by a covered investment.
3. This Chapter shall not apply to:
(a) financial services as defined in Article 8.20 (Definitions), except that paragraph 2 shall apply where the financial service is supplied by a covered investment that is not a covered investment in a financial institution as defined in Article 8.20 (Definitions) in a Party's territory;
(b) government procurement;
(c) subsidies or grants provided by a Party, including government-supported loans, guarantees, and insurance; or
(d) air services, including domestic and international air transportation services, whether scheduled or non-scheduled, and related services in support of air services, other than:
(i) aircraft repair and maintenance services;
(ii) the selling and marketing of air transport services;
(iii) computer reservation system services; and (iv) specialty air services.
The Parties note the multilateral negotiations pursuant to the review of the GATS Annex on Air Transport Services. Upon the conclusion of such multilateral negotiations, the Parties shall conduct a review for the purpose of discussing appropriate amendments to this Agreement so as to incorporate the results of such multilateral negotiations.
4, This Chapter shall not impose any obligation on a Party with respect to a national of the other Party seeking access to its employment market, or employed on a permanent basis in its territory, and shall not confer any right on that national with respect to that access or employment.
5. This Chapter shall not apply to services supplied in the exercise of governmental authority in a Party's territory. A service supplied in the exercise of governmental authority means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.
Article 7.2. National Treatment
1. Each Party shall accord to service suppliers of the other Party treatment no less favourable than that it accords, in like circumstances, to its own service suppliers.
2. The treatment to be accorded by a Party under paragraph 1 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment accorded, in like circumstances, by that regional level of government to service suppliers of the Party of which it forms a part.
Article 7.3. Most-favoured-nation Treatment
Each Party shall accord to service suppliers of the other Party treatment no less favourable than that it accords, in like circumstances, to service suppliers of a non-Party.
Article 7.4. Market Access
Neither Party shall adopt or maintain, either on the basis of a regional subdivision or on the basis of its entire territory, measures that:
(a) impose limitations on:
(i) the number of service suppliers, whether in the form of numerical quotas, monopolies, exclusive service suppliers, or the requirement of an economic needs test;
(ii) the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(iii) the total number of service operations or the total quantity of services output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test; or
(iV) the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test; or
(b) restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service.
Article 7.5. Local Presence
Neither Party shall require a service supplier of the other Party to establish or maintain a representative office or any form of enterprise, or to be resident, in its territory as a condition for the cross-border supply of a service.
Article 7.6. Non-conforming Measures
1. Articles 7.2 through 7.5 shall not apply to:
(a) any existing non-conforming measure that is maintained by a Party at:
(i) the central level of government, as set out by that Party in its Schedule to Annex I;
(ii) a regional level of government, as set out by that Party in its Schedule to Annex I; or
(iii) a local level of government;
(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure, as it existed immediately before the amendment, with Article 7.2, 7.3, 7.4 or 7.5.
2. Articles 7.2 through 7.5 shall not apply to any measure that a Party adopts or maintains with respect to sectors, sub-sectors, or activities as set out in its Schedule to Annex II.
Article 7.7. Domestic Regulation
1. Where a Party requires authorisation for the supply of a service, the Party's competent authorities shall, within a reasonable time after the submission of an application considered complete under its laws and regulations, inform the applicant of the decision concerning the application. On request of the applicant, the Party's competent authorities shall provide, without undue delay, information concerning the status of the application. This obligation shall not apply to authorisation requirements that a Party adopts or maintains with respect to sectors, sub-sectors, or activities as set out in its Schedule to Annex II.
2. With a view to ensuring 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 endeavour to ensure, as appropriate for individual sectors, that such measures are:
(a) based on objective and transparent criteria, such as competence and the ability to supply the service;
(b) not more burdensome than necessary to ensure the quality of the service; and
(c) in the case of licensing procedures, not in themselves a restriction on the supply of the service.
3. If the results of the negotiations related to Article VI:4 of the GATS (or the results of any similar negotiations undertaken in other multilateral fora in which the Parties participate) enter into effect, this Article shall be amended, as appropriate, after consultations between the Parties, to bring those results into effect between the Parties under this Agreement. The Parties shall coordinate on such negotiations, as appropriate.
4. Subject to its laws and regulations, a Party shall permit service suppliers of the other Party
to use the enterprise names under which they trade in the territory of the other Party and otherwise ensure that the use of the enterprise names is not unduly restricted.
Article 7.8. Transparency In Developing and Applying Regulations
Further to Chapter 19 (Transparency):
(a) each Party shall establish or maintain appropriate mechanisms for responding to enquiries from interested persons regarding its regulations relating to the subject matter of this Chapter; and
(b) if a Party does not provide, in accordance with Article 19.1.2, advance notice of and opportunity for comment on regulations it proposes to adopt relating to the subject matter of this Chapter, it shall, on request of the other Party, address in writing the reasons for not doing so.
Article 7.9. Recognition
1. For the purposes of the fulfilment, in whole or in part, of its standards or criteria for the authorisation, licensing, or certification of service suppliers, and subject to the requirements of paragraph 5, a Party may recognise the education or experience obtained, requirements met, or licences or certifications granted in a particular country. Such recognition, which may be achieved through harmonisation or otherwise, may be based upon an agreement or arrangement with the country concerned or may be accorded autonomously.
2. Where a Party recognises, autonomously or by agreement or arrangement, the education or experience obtained, requirements met, or licences or certifications granted in the territory of a non-Party, nothing in Article 7.3 shall be construed to require the Party to accord such recognition to the education or experience obtained, requirements met, or licences or certifications granted in the territory of the other Party.
3. On request of the other Party, a Party shall promptly provide information, including appropriate descriptions, concerning any recognition agreement or arrangement that the Party has concluded. For recognition arrangements entered into by relevant bodies in its territory, a Party shall encourage those bodies to provide the same information.
4, A Party that is a party to an agreement or arrangement of the type referred to in paragraph 1, whether existing or future, shall afford adequate opportunity for the other Party, if that other Party is interested, to negotiate its accession to such an agreement or arrangement or to negotiate a comparable one with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for the other Party to demonstrate that education or experience obtained, requirements met, or licences or certifications granted in that other Party's territory should be recognised.
5. A Party shall not accord recognition in a manner that would constitute a means of discrimination between countries in the application of its standards or criteria for the authorisation, licensing, or certification of service suppliers, or a disguised restriction on trade in services.
6. Annex 7-A shall apply to measures adopted or maintained by a Party relating to the licensing or certification of professional service suppliers as set out in that Annex.
Article 7.10. Payments and Transfers
1. Each Party shall permit all payments and transfers relating to the cross-border supply of services to be made freely and without delay into and out of its territory.
2. Each Party shall permit such payments and transfers relating to the cross-border supply of services to be made in a freely usable currency at the market rate of exchange prevailing at the time of the payment or transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may prevent or delay a payment or transfer through the equitable, non-discriminatory, and good faith application of its laws and regulations relating to:
(a) bankruptcy, insolvency, or the protection of the rights of creditors; (b) issuing, trading, or dealing in securities, futures, options, or derivatives;
(c) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;
(d) criminal or penal offences; or
(e) ensuring compliance with orders or judgments in judicial or administrative proceedings.
Article 7.11. Denial of Benefits
1. A Party may deny the benefits of this Chapter to a service supplier of the other Party if the service supplier is an enterprise owned or controlled by persons of a non-Party, and the denying Party adopts or maintains measures with respect to the non-Party or a person of the non-Party that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of this Chapter were accorded to the enterprise.
2. A Party may deny the benefits of this Chapter to a service supplier of the other Party if the service supplier is an enterprise owned or controlled by persons of a non-Party or of the denying Party that has no substantive business operations in the territory of the other Party. If, before denying the benefits of this Chapter, the denying Party knows that the enterprise has no substantive business operations in the territory of the other Party and that persons of a non-Party, or of the denying Party, own or control the enterprise, the denying Party shall, to the extent possible, notify the other Party before denying the benefits. If the denying Party provides such notice, it shall consult with the other Party on request of the other Party.