While devising and applying such measures, Slovenia shall grant preferential treatment wherever possible to Community companies and nationals, and in no case treatment less favourable than that accorded to companies or nationals from any third country.
Prior to the adoption of these measures, Slovenia shall consult the Association Council and shall not put them into effect before a one month period has elapsed following the notification to the Association Council of the concrete measures to be introduced by Slovenia, except where the threat of irreparable damage requires the taking of urgent measures, in which case Slovenia shall consult the Association Council immediately after their adoption.
Upon the expiry of the fourth year following the entry into force of this Agreement or, for the sectors included in Annex IX(a), upon the expiry of the transitional period referred to in Article 3, Slovenia may introduce such measures only with the authorisation of the Association Council and under conditions determined by the latter.
Chapter III. SUPPLY OF SERVICES BETWEEN THE COMMUNITY AND SLOVENIA
Article 53.
1. The parties undertake in accordance with the following provisions to take the necessary steps to allow progressively the supply of services by Community or Slovenian companies or nationals which are established in a party other than that of the person for whom the services are intended.
2. In step with the liberalization process mentioned in paragraph 1, and subject to the provisions of Article 57(1), the parties shall permit the temporary movement of natural persons providing the service or who are employed by the service provider as key personnel as defined in Article 50(2), including natural persons who are representatives of a Community or Slovenian company or national and are seeking temporary entry for the purpose of negotiating for the sale of services or entering into agreements to sell services for that service provider, where those representatives will not be engaged in making direct sales to the general public or in supplying services themselves.
3. At the latest eight years after the entry into force of this Agreement, the Association Council shall take the measures necessary to implement progressively the provisions of paragraph 1. Account shall be taken of the progress achieved by the parties in the approximation of their laws.
Article 54.
1. The parties shall not take any measures or actions which render the conditions for the supply of services by Community and Slovenian nationals or companies which are established in a party other than that of the person for whom the services are intended significantly more restrictive as compared to the situation existing on the day preceding the day of entry into force of the Agreement.
2. If one party is the view that measures introduced by the other party since the signature of the Agreement result in a situation which is significantly more restrictive in respect of supply of services as compared with the situation existing at the date of signature of the Agreement, such first party may request the other party to enter into consultations.
Article 55.
With regard to supply of transport services between the Community and Slovenia, the following shall apply without prejudice to the provisions of Article 53:
1. With regard to inland transport, the relationship between the parties is governed by the Agreement between the European Economic Community and the Republic of Slovenia in the field of transport, signed on 5 April 1993. The parties confirm the importance they attach to the correct application of this Agreement, and underline the particular importance of the freedom of road transit traffic, as defined in the Agreement, without prejudice to the conditions regulating transit through Austria following Austria's accession to the European Union, of non-discrimination and of harmonisation of the Slovenian transport legislation with that of the Community.
2. With regard to international maritime transport the parties undertake to apply effectively the principle of unrestricted access to the market and traffic on a commercial basis.
(a) The above provision does not prejudice the rights and obligations under the United Nations Code of Conduct for Liner Conferences, as applied by one or the other party to this Agreement. Non-conference liners will be free to operate in competition with a conference as long as they adhere to the principle of fair competition on a commercial basis.
(b) The parties affirm their commitment to a freely competitive environment as being an essential feature of the dry and liquid bulk trade.
3. In applying the principles of point 2, the parties shall:
(a) not introduce cargo-sharing clauses in future bilateral agreements with third countries, other than in those exceptional circumstances where liner shipping companies from one or other party to this Agreement would not otherwise have an effective opportunity to ply for trade to and from the third country concerned;
(b) prohibit cargo-sharing arrangements in future bilateral agreements concerning dry and liquid bulk trade;
(c) abolish, upon the entry into force of this Agreement, all unilateral measures and administrative, technical and other obstacles which could have restrictive or discriminatory effects on the free supply of services in international maritime transport.
4. With a view to ensuring a coordinated development and progressive liberalization of transport between the parties adapted to their reciprocal commercial needs, the conditions of mutual market access in air transport shall be dealt with by special agreement to be negotiated between the parties after the entry into force of this Agreement.
5. Prior to the conclusion of the agreement referred to in point 4, the parties shall not take any measures or actions which are more restrictive or discriminatory as compared with the situation existing prior to the entry into force of this Agreement.
6. During the transitional period, Slovenia shall progressively adapt its legislation, including administrative, technical and other rules, to that of the Community existing at any time in the field of air and inland transport in so far as it serves liberalization purposes and mutual access to markets of the parties and facilitates the movement of passengers and of goods.
7. In step with the common progress in the achievement of the objectives of this Chapter, the Association Council shall examine ways of creating the conditions necessary for improving freedom to provide air and inland transport services.
Chapter IV. GENERAL PROVISIONS
Article 56.
1. The provisions of this Title shall be applied subject to limitations justified on grounds of public policy, public security or public health.
2. They shall not apply to activities which in the territory of either party are connected, even occasionally, with the exercise of official authority.
Article 57.
1. For the purpose of this Title, nothing in this Agreement shall prevent the parties from applying their laws and regulations regarding entry and stay, employment, working conditions, establishment of natural persons and supply of services, provided that, in so doing, they do not apply them in such a manner as to nullify or impair the benefits accruing to any party under the terms of a specific provision of this Agreement. This provision shall be without prejudice to the application of Article 56.
2. The exclusion of Community companies and nationals established in Slovenia in accordance with the provisions of Chapter II from public aid granted by Slovenia in the areas of public education services, health-related and social services and cultural services shall, for the duration of the transitional period referred to in Article 3, be deemed compatible with the provisions of this title and with the competition rules referred to in Title V.
Article 58.
Companies which are controlled and exclusively owned jointly by Slovenian companies or nationals and Community companies or nationals shall also be covered by the provisions of this Title.
Article 59.
1. The Most-Favoured-Nation treatment granted in accordance with the provisions of this Title shall not apply to the tax advantages which the parties are providing or will provide in the future on the basis of agreements designed to avoid double taxation or other tax arrangements.
2. None of the provisions of this Title shall be construed to prevent the adoption or enforcement by the parties of any measure aimed at preventing the avoidance or evasion of taxes pursuant to the tax provisions of agreements to avoid double taxation and other tax arrangements or domestic fiscal legislation.
3. None of the provisions of this Title shall be construed to prevent Member States or Slovenia in applying the relevant provisions of their fiscal legislation, from distinguishing between taxpayers who are not in identical situations, in particular as regards their place of residence.
Article 60.
The provisions of this Title shall be progressively adjusted, notably in the light of requirements arising from Article V of the General Agreement on Trade in Services (GATS).
Article 61.
The provisions of this Agreement shall not prejudice the application by each party of any measure necessary to prevent the circumvention of its measures concerning third-country access to its market through the provisions of this Agreement.
Title V. PAYMENTS, CAPITAL, COMPETITION AND OTHER ECONOMIC PROVISIONS, APPROXIMATION OF LAWS
Chapter I. CURRENT PAYMENTS AND MOVEMENT OF CAPITAL
Article 62.
The parties undertake to authorise, in freely convertible currency, any payments on the current account of balance of payments to the extent that the transactions underlying the payments concern movements of goods, services or persons between the parties which have been liberalised pursuant to this Agreement.
Article 63.
1. With regard to transactions on the capital account of balance of payments from the entry into force of this Agreement, the Member States and Slovenia respectively shall ensure the free movement of capital relating to direct investments made in companies formed in accordance with the laws of the host country and investments made in accordance with the provisions of Chapter II of Title IV, and the liquidation or repatriation of the product of those investments and of any profit stemming therefrom.
Notwithstanding the above provision, such free movement, liquidation and repatriation shall be ensured by the end of the fourth year following the entry into force of this Agreement for all investments linked to establishment of Community nationals pursuing an activity in Slovenia as self-employed persons pursuant to Chapter II of Title IV.
With regard to acquisition of more than 25 % of shares providing voting rights issued under the Law on the Ownership Transformation of Enterprises in a company with a nominal share capital exceeding ECU 5 million, Slovenian government authorisation is required for a period of three years after the entry into force of this Agreement. Thereafter this restriction will be removed.
2. With regard to transactions on the capital account of balance of payments, from entry into force of this Agreement, the Member States and Slovenia respectively shall ensure free movement of capital relating to credits related to commercial transactions or to the provision of services in which a resident of one of the parties is participating, and to financial loans.
They shall also ensure from the fourth year after the entry into force of this Agreement free movement of capital relating to portfolio investment.
Without prejudice to Articles 62 and 63, where, in exceptional circumstances, movements of capital between the residents of the Community and Slovenia cause, or threaten to cause, serious difficulties for the operation of exchange rate policy or monetary policy in the Community or Slovenia, the Community and Slovenia, respectively, may take safeguard measures with regard to movements of capital between the Community and Slovenia for a period not exceeding six months if such measures are strictly necessary.
3. Without prejudice to paragraph 1, the Member States and Slovenia, as from the entry into force of this Agreement, shall not introduce any new foreign exchange restrictions on the movement of capital and current payments connected therewith between residents of the Community and Slovenia and shall not make the existing arrangements more restrictive.
4. The parties shall consult each other with a view to facilitating the movement of capital between the Community and Slovenia in order to promote the objectives of this Agreement.
Article 64.
1. During the four years following the date of entry into force of this Agreement, the parties shall take measures permitting the creation of the necessary conditions for the further gradual application of Community rules on the free movement of capital.
2. By the end of the fourth year from the entry into force of this Agreement, the Association Council shall examine ways of enabling Community rules on the movement of capital to be applied in full.
Chapter II. COMPETITION AND OTHER ECONOMIC PROVISIONS
Article 65.
1. The following are incompatible with the proper functioning of the Agreement, in so far as they may affect trade between the Community and Slovenia:
(i) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition;
(ii) abuse by one or more undertakings of a dominant position in the territories of the Community or of Slovenia as a whole or in a substantial part thereof;
(iii) any public aid which distorts or threatens to distort competition by favouring certain undertakings or certain products.
2. Any practices contrary to this Article shall be assessed on the basis of criteria arising from the application of the rules of Articles 85, 86 and 92 of the Treaty establishing the European Community.
3. The Association Council shall, within three years of the entry into force of this Agreement, adopt the necessary rules for the implementation of paragraphs 1 and 2. Until the implementing rules are adopted, practices incompatible with paragraph 1 shall be dealt with by the parties on their respective territories according to their respective legislation. This shall be without prejudice to paragraph 6.
4. (a) For the purposes of applying the provisions of paragraph 1(iii), the parties recognise that during the first four years after the entry into force of this Agreement, any public aid granted by Slovenia shall be assessed taking into account the fact that Slovenia shall be regarded as an area identical to those areas of the Community described in Article 92(3)(a) of the Treaty establishing the European Community. The Association Council shall, taking into account the economic situation of Slovenia, decide whether that period should be extended by further periods of four years.
(b) Each party shall ensure transparency in the area of public aid, inter alia by reporting annually to the other party on the total amount and the distribution of the aid given and by providing, upon request, information on aid schemes. Upon request by one party, the other party shall provide information on particular individual cases of public aid.
5. With regard to products referred to in Chapters II and III of Title III:
- paragraph 1(iii) shall not apply;
- any practices contrary to paragraph 1(i) shall be assessed according to the criteria established by the Community on the basis of Articles 42 and 43 of the Treaty establishing the European Community and in particular of those established in Council Regulation No 26/1962.
6. If the Community or Slovenia considers that a particular practice is incompatible with the terms of paragraph 1, and:
- is not adequately dealt with under the implementing rules referred to in paragraph 3, or
- in the absence of such rules, and if such practice causes or threatens to cause serious injury to the interests of the other party or material injury to its domestic industry, including its services industry,
it may take appropriate measures after consultation within the Association Council or after thirty working days following referral for such consultation.
In the case of practices incompatible with paragraph 1(iii), such appropriate measures may, where the WTO Agreement applies thereto, only be adopted in accordance with the procedures and under the conditions laid down thereby and any other relevant instrument negotiated under its auspices which are applicable between the parties.
7. Notwithstanding any provisions to the contrary adopted in accordance with paragraph 3, the parties shall exchange information taking into account the limitations imposed by the requirements of professional and business confidentiality.
8. This Article shall not apply to the products covered by the Treaty establishing the European Coal and Steel Community which are the subject of Protocol 2.
Article 66.
1. The parties shall endeavour wherever possible to avoid the imposition of restrictive measures, including measures relating to imports, for balance of payments purposes. A party adopting such measures shall present as soon as possible to the other party a timetable for their removal.
2. Where one or more Member States or Slovenia is in serious balance of payments difficulties, or under imminent threat thereof, the Community or Slovenia, as the case may be, may, in accordance with the conditions established under the WTO Agreement, adopt restrictive measures, including measures relating to imports, which shall be of limited duration and may not go beyond what is strictly necessary to remedy the balance of payments situation. The Community or Slovenia, as the case may be, shall inform the other party forthwith.
3. Any restrictive measures shall not apply to transfers related to investment and in particular to the repatriation of amounts invested or reinvested or any kind of revenues stemming therefrom.
Article 67.
With regard to public undertakings, and undertakings to which special or exclusive rights have been granted, the Association Council shall ensure that as from the third year following the date of entry into force of this Agreement, the principles of the Treaty establishing the European Community, in particular Article 90 thereof, are upheld.
Article 68.
1. Pursuant to the provisions of this Article and Annex X, the parties confirm the importance that they attach to ensure adequate and effective protection and enforcement of intellectual, industrial and commercial property rights.
2. From the entry into force of the Agreement, Slovenia shall protect intellectual, industrial and commercial property rights at a level of protection similar to that existing in the Community, including effective means of enforcing such rights.
3. Before the entry into force of the Agreement, Slovenia shall accede to the multilateral conventions on intellectual, industrial and commercial property rights referred to in paragraph 1 of Annex X.
4. If problems in the area of intellectual, industrial and commercial property affecting trading conditions were to occur, they shall be referred urgently to the Association Council, at the request of either party, with a view to reaching mutually satisfactory solutions.
Article 69.
1. The parties consider the opening-up of the award of public contracts on the basis of non-discrimination and reciprocity, in particular in the WTO context, to be a desirable objective.
2. Slovenian companies, shall be granted access to contract award procedures in the Community pursuant to Community procurement rules under treatment no less favourable than that accorded to Community companies as from the entry into force of this Agreement, except for contracts covered by Directive 93/38/EEC.
The above provisions would also apply to contracts covered by Directive 93/38/EEC immediately the Slovenian government introduced the appropriate legislation. The Community shall examine periodically whether Slovenia has indeed introduced such legislation.
Community companies shall be granted access to contract award procedures in Slovenia under treatment no less favourable than that accorded to Slovenian companies at the latest by the end of the transitional period referred to in Article 3.
Community companies established in Slovenia under the provisions of Chapter II of Title IV shall have upon entry into force of this Agreement access to contract award procedures under treatment no less favourable than that accorded to Slovenian companies.
The Association Council shall periodically examine the possibility for Slovenia to introduce access to award procedures in Slovenia for all Community companies prior to the end of the transitional period.
3. As regards establishment, operations, supply of services between the Community and Slovenia, and also employment and movement of labour linked to the fulfilment of public contracts, the provisions of Articles 38 to 61 are applicable.
Chapter III. APPROXIMATION OF LAWS
Article 70.
The parties recognise that the major precondition for Slovenia's economic integration into the Community is the approximation of Slovenia's existing and future laws to that of the Community. Slovenia shall endeavour to ensure that its laws will be gradually made compatible with that of the Community.
Article 71.
1. The approximation of laws shall extend to the following areas in particular: customs law, company law, banking law, insurance law, company accounts and taxation, financial services, rules on competition, rules on public contracts and public procurement, protection of health and life of humans, animals and plants, indirect taxation, technical rules and standards, nuclear law and regulation, transport and telecommunications.
2. The parties also consider it particularly important to make rapid progress in the approximation of laws in the field of the internal market, competition, protection of workers, consumers' rights and the environment.
Article 72.
The Community shall provide Slovenia with technical assistance for the implementation of these measures, which may include inter alia:
- the exchange of experts;
- the provision of early information, especially on relevant legislation;
- organisation of seminars;
- training activities;
- aid for the translation of Community and Slovenian legislation in the relevant sectors.
Title VI. ECONOMIC COOPERATION
Article 73.
1. The Community and Slovenia shall establish economic cooperation aimed at contributing to Slovenia's development and growth potential. Such cooperation shall strengthen existing economic links on the widest possible foundation, to the benefit of both parties.
2. Policies and other measures will be designed to bring about the economic and social development of Slovenia and will be guided by the principle of sustainable development. These policies should ensure that environmental considerations are also fully incorporated from the outset and that they are linked to the requirements of harmonious social development.
3. To this end the cooperation should focus in particular on policies and measures related to industry including the mining sector, investment, agriculture, energy, transport, regional development and tourism.
4. Special attention must be devoted to measures capable of fostering cooperation between Slovenia and the countries of Central and Eastern Europe.
Article 74. Industrial Cooperation
1. Cooperation shall be aimed at promoting the modernisation and restructuring of Slovenian industry in both public and private sectors as well as industrial cooperation between economic operators of both sides, with the particular objective of strengthening the private sector, while respecting the environment.
2. In particular cooperation shall promote:
- the restructuring of individual sectors; in this context, the Association Council will examine in particular the problems affecting the coal and steel sectors;
- the establishment of new undertakings in areas offering potential for growth.
3. Industrial cooperation initiatives shall take into account priorities determined by Slovenia. The initiatives should seek in particular to establish a suitable framework for undertakings, to improve management know-how, to promote markets, market transparency and the business environment, and will include technical assistance where appropriate.
Article 75. Investment Promotion and Protection
1. Cooperation between the parties shall be aimed at establishing a favourable climate for private investment, both domestic and foreign, which is essential to economic and industrial reconstruction in Slovenia.
2. The particular aims of cooperation shall be:
- for Slovenia to establish a legal framework which favours and protects investment;
- the conclusion, where appropriate, with Member States of bilateral agreements for the promotion and protection of investment;
- to conclude, where appropriate, agreements between Member States and Slovenia to avoid double taxation;
- to implement suitable arrangements for the transfer of capital;
- to proceed with deregulation;
- to improve economic infrastructure;
- to exchange information on investment opportunities through trade fairs, exhibitions, trade weeks and other events.
Article 76. Standards and Conformity Assessment
1. The parties shall cooperate with the aim of achieving Slovenia's full conformity with Community technical regulations and European standardisation and conformity assessment procedures.
2. To this end, the cooperation shall seek:
- to promote the use of Community technical regulations and European standards and conformity assessment procedures;
- where appropriate, to negotiate agreements on mutual recognition in these fields;
- to encourage participation by relevant Slovenian bodies in the work of specialised European organisations (CEN, CENELEC, ETSI, EOTC).
3. The Community will provide Slovenia with technical assistance where appropriate.
Article 77. Cooperation In Science and Technology
1. The parties shall promote cooperation in research and technological development. They shall devote special attention to the following:
- the exchange of information on each other's science and technology policies;
- the organisation of joint scientific meetings (seminars and workshops);
- joint R& D activities aimed at encouraging scientific progress and the transfer of technology and know-how;
- training activities and mobility programmes for researchers and specialists from both sides;
- the development of an environment conducive to research and the application of new technologies and adequate protection of intellectual property rights in respect of research findings;
- participation of Slovenia in the Community programmes in accordance with paragraph 3.
Technical assistance shall be provided where appropriate.
2. The Association Council shall determine the appropriate procedures for developing cooperation.
3. Cooperation under the Community's framework programme in the field of research and technological development shall be implemented according to specific arrangements to be negotiated and concluded in accordance with the legal procedures of each party.