FOR THE REPUBLIC OF LATVIA,
FOR THE REPUBLIC OF LITHUANIA,
FOR THE GRAND DUCHY OF LUXEMBOURG,
FOR HUNGARY,
FOR THE REPUBLIC OF MALTA,
FOR THE KINGDOM OF THE NETHERLANDS,
FOR THE REPUBLIC OF AUSTRIA,
FOR THE REPUBLIC OF POLAND,
FOR THE PORTUGUESE REPUBLIC,
FOR ROMANIA,
FOR THE REPUBLIC OF SLOVENIA,
FOR THE SLOVAK REPUBLIC,
FOR THE REPUBLIC OF FINLAND,
FOR THE KINGDOM OF SWEDEN,
FOR THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND,
FOR THE EUROPEAN UNION,
FOR CANADA
Attachments
ANNEX 8-A. EXPROPRIATION
The Parties confirm their shared understanding that:
1. Expropriation may be direct or indirect:
(a) direct expropriation occurs when an investment is nationalised or otherwise directly expropriated through formal transfer of title or outright seizure; and
(b) indirect expropriation occurs if a measure or series of measures of a Party has an effect equivalent to direct expropriation, in that it substantially deprives the investor of the fundamental attributes of property in its investment, including the right to use, enjoy and dispose of its investment, without formal transfer of title or outright seizure.
2. The determination of whether a measure or series of measures of a Party, in a specific fact situation, constitutes an indirect expropriation requires a case-by-case, fact-based inquiry that takes into consideration, among other factors:
(a) the economic impact of the measure or series of measures, although the sole fact that a measure or series of measures of a Party has an adverse effect on the economic value of an investment does not establish that an indirect expropriation has occurred;
(b) the duration of the measure or series of measures of a Party;
(c) the extent to which the measure or series of measures interferes with distinct, reasonable investment-backed expectations; and
(d) the character of the measure or series of measures, notably their object, context and intent.
3. For greater certainty, except in the rare circumstance when the impact of a measure or series of measures is so severe in light of its purpose that it appears manifestly excessive, non-discriminatory measures of a Party that are designed and applied to protect legitimate public welfare objectives, such as health, safety and the environment, do not constitute indirect expropriations.
ANNEX 8-B. PUBLIC DEBT
1. For the purposes of this Annex:
negotiated restructuring means the restructuring or rescheduling of debt of a Party that has been effected through
(a) a modification or amendment of debt instruments, as provided for under their terms, including their governing law, or
(b) a debt exchange or other similar process in which the holders of no less than 75 per cent of the aggregate principal amount of the outstanding debt subject to restructuring have consented to such debt exchange or other process; and
governing law of a debt instrument means a jurisdiction's laws applicable to that debt instrument.
2. No claim that a restructuring of debt of a Party breaches an obligation under Sections C and D may be submitted, or if already submitted continue, under Section F if the restructuring is a negotiated restructuring at the time of submission, or becomes a negotiated restructuring after such submission, except for a claim that the restructuring violates Article 8.6 or 8.7.
3. Notwithstanding Article 8.22.1(b) and subject to paragraph 2, an investor of a Party may not submit a claim under Section F that a restructuring of debt of a Party breaches an obligation under Sections C and D (other than Article 8.6 or 8.7) (1) unless 270 days have elapsed from the date of submission by the claimant of the written request for consultations pursuant to Article 8.19.
4. For greater certainty, debt of a Party means a debt instrument of any level of government of a Party.
ANNEX 8-C. EXCLUSIONS FROM DISPUTE SETTLEMENT
A decision by Canada following a review under the Investment Canada Act, R.S.C. 1985, c. 28 (1st Supp.), regarding whether or not to permit an investment that is subject to review, is not subject to the dispute settlement provisions under Section F, or to Chapter Twenty-Nine (Dispute Settlement). For greater certainty, this exclusion is without prejudice to the right of a Party to have recourse to Chapter Twenty-Nine (Dispute Settlement) with respect to the consistency of a measure with a Party's reservations, as set out in the Party's Schedule to Annexes I, II or III, as appropriate.
ANNEX 8-D. JOINT DECLARATION CONCERNING ARTICLE 8.12.6
Mindful that the Tribunal for the resolution of investment disputes between investors and states is meant to enforce the obligations referred to in Article 8.18.1, and is not an appeal mechanism for the decisions of domestic courts, the Parties recall that the domestic courts of each Party are responsible for the determination of the existence and validity of intellectual property rights. The Parties further recognise that each Party shall be free to determine the appropriate method of implementing the provisions of this Agreement regarding intellectual property within their own legal system and practice. The Parties agree to review the relation between intellectual property rights and investment disciplines within three years after entry into force of this Agreement or at the request of a Party. Further to this review and to the extent required, the Parties may issue binding interpretations to ensure the proper interpretation of the scope of investment protection under this Agreement in accordance with the provisions of Article 8.31.3.
ANNEX 8-E. JOINT DECLARATION ON ARTICLES 8.16, 9.8, AND 28.6
With respect to Articles 8.16, 9.8 (Denial of benefits) and 28.6 (National security), the Parties confirm their understanding that measures that are ‘related to the maintenance of international peace and security’ include the protection of human rights.
ANNEX 8-F. DECLARATION BY CANADA ON THE INVESTMENT CANADA ACT
Canada will increase the threshold for review under the Investment Canada Act, R.S.C. 1985, c. 28 (1st Supp.) (‘ICA’) to CAD $1.5 billion once this Agreement is implemented.
Any future amendments to the ICA would be subject to the requirement that such amendments could not decrease the conformity of the ICA with the investment obligations of this Agreement.
As set out in Canada's ICA reservation (Annex I-C-1), the higher threshold will apply to an acquisition of a Canadian enterprise by an investor of the European Union that is not a state enterprise. The determination of whether the acquirer is an investor of the European Union would be based on whether a national of the European Union controls the acquirer in law, or in the absence of a majority ownership, whether nationals of the European Union control the acquirer in fact such as through the ownership of voting interests or through the nationality of members of the board of directors. Moreover, enterprises of the European Union that are controlled by nationals from Canada's existing Free Trade Agreement partners with which Canada has taken investment commitments would also benefit from the higher threshold.
Canada will amend its ICA to provide for the changes necessary for the higher review threshold stated above upon the entry into force of this Agreement.
ANNEX 29-A. RULES OF PROCEDURE FOR ARBITRATION
Definitions and general provisions
1. For this Chapter and under these Rules:
adviser means a natural person retained by a Party to advise or assist that Party in connection with the arbitration proceeding;
arbitration panel means a panel established under Article 29.7;
arbitrator means a member of an arbitration panel established under Article 29.7;
assistant means a natural person who, under the terms of appointment of an arbitrator conducts research for or provides assistance to the arbitrator;
day means a calendar day, unless otherwise specified;
legal holiday means every Saturday and Sunday and any other day designated by a Party as a holiday for the purposes of these Rules;
representative of a Party means an employee or any natural person appointed by a government department or agency or any other public entity of a Party who represents the Party for the purposes of a dispute under this Agreement;
responding Party means the Party that is alleged to be in violation of the provisions referred to in Article 29.2; and
requesting Party means any Party that requests the establishment of an arbitration panel under Article 29.6;
2. The responding Party shall be in charge of the logistical administration of the arbitration proceedings, in particular the organisation of hearings, unless otherwise agreed. However, the Parties shall bear equally the administrative expenses of the arbitration proceedings as well as the remuneration and all travel, lodging and general expenses of the arbitrators and their assistants.
Notifications
3. Unless agreed otherwise, the Parties and the arbitration panel shall transmit a request, notice, written submission or other document by email, with a copy submitted on the same day by facsimile transmission, registered post, courier, delivery against receipt or any other means of telecommunication that provides a record of its sending. Unless proven otherwise, an email message shall be deemed to be received on the same date of its sending.
4. When communicating in writing, a Party shall provide an electronic copy of its communications to the other Party and to each of the arbitrators.
5. Minor errors of a clerical nature in a request, notice, written submission or other document related to the arbitration proceeding may be corrected by delivery of a new document clearly indicating the changes.
6. If the last day for delivery of a document falls on an official holiday or rest day in Canada or in the European Union, the document may be delivered on the next business day. No documents, notifications or requests of any kind shall be deemed to be received on a legal holiday.
7. Depending on the provisions under dispute, all requests and notifications addressed to the CETA Joint Committee in accordance with this Chapter shall also be copied to the other relevant institutional bodies.
Commencing the arbitration
8. Unless the Parties agree otherwise, they shall meet the arbitration panel within seven working days of its establishment in order to determine such matters that the Parties or the arbitration panel deem appropriate, including the remuneration and expenses to be paid to the arbitrators, which shall be in accordance with WTO standards. Remuneration for each arbitrator's assistant shall not exceed 50 per cent of the total remuneration of that arbitrator. Arbitrators and representatives of the Parties may take part in this meeting via telephone or video conference.
9. (a) Unless the Parties agree otherwise, within five working days of the date of the establishment of the arbitration panel, the terms of reference of the arbitration panel shall be:
‘to examine, in the light of the relevant provisions of the Agreement, the matter referred to in the request for establishment of the arbitration panel, to rule on the compatibility of the measure in question with the provisions referred to in Article 29.2 and to make a ruling in accordance with Articles 29.10, 29.17 and 29.18.’.
(b) The Parties shall notify the agreed terms of reference to the arbitration panel within three working days of their agreement.
(c) The arbitration panel may rule on its own jurisdiction.
Initial submissions
10. The requesting Party shall deliver its initial written submission no later than 10 days after the date of establishment of the arbitration panel. The responding Party shall deliver its written counter-submission no later than 21 days after the date of delivery of the initial written submission.
Working of arbitration panels
11. The chairperson of the arbitration panel shall preside over all meetings. An arbitration panel may delegate to the chairperson authority to make administrative and procedural decisions.
12. Hearings shall take place in person. Unless otherwise provided in this Chapter and without prejudice to paragraph 30, the arbitration panel may conduct its other activities by any means, including telephone, facsimile transmissions or computer links.
13. Only arbitrators may take part in the deliberations of the arbitration panel, but the arbitration panel may permit its assistants to be present at its deliberations.
14. The drafting of any ruling shall remain the exclusive responsibility of the arbitration panel and must not be delegated.
15. Findings, determinations and recommendations of the arbitration panel under Articles 29.9 and 29.10 should be made by consensus, but if consensus is not possible then by a majority of its members.
16. Arbitrators may not issue separate opinions on matters not unanimously agreed.
17. Where a procedural question arises that is not covered by the provisions of Chapter Twenty-Nine (Dispute Settlement), the arbitration panel, after consulting with the Parties, may adopt an appropriate procedure that is compatible with those provisions and that ensures equal treatment between the Parties.
18. If the arbitration panel considers that there is a need to modify any time limit applicable in the proceedings or to make any other procedural or administrative adjustment as may be required for the fairness or efficiency of the proceedings, it shall inform the Parties in writing of the reasons for the modification or adjustment and of the period or adjustment needed. The arbitration panel may adopt such modification or adjustment after having consulted the Parties.
19. Any time limit referred to in this Chapter and in this Annex may be modified by mutual consent of the Parties. Upon request of a Party, the arbitration panel may modify the time limits applicable in the proceedings.
20. The arbitration panel shall suspend its work:
(a) at the request of the requesting Party for a period specified in the request but not to exceed 12 consecutive months, and shall resume its work at the request of the requesting Party; or
(b) after it has issued its interim report or in the case of a proceeding on a disagreement on equivalence under Article 29.14 or a proceeding under Article 29.15, only upon the request of both Parties for a period specified in the request, and shall resume its work at the request of either Party.
If there is no request for the resumption of the arbitration panel's work by the end of the period specified in the request for suspension, the proceeding shall be terminated. The termination of the arbitration panel's work is without prejudice to the rights of the Parties in another proceeding on the same matter under Chapter Twenty-Nine (Dispute Settlement).
Replacement
21. If an arbitrator is unable to participate in the proceeding, withdraws, or must be replaced, a replacement shall be selected in accordance with Article 29.7.3.
22. Where a Party considers that an arbitrator does not comply with the requirements of the code of conduct of Annex 29-B (‘Code of Conduct’) and for this reason must be replaced, that Party shall notify the other Party within 15 days from the time it came to know of the circumstances underlying the arbitrator's non-compliance with the Code of Conduct.
23. Where a Party considers that an arbitrator other than the chairperson does not comply with the requirements of the Code of Conduct, the Parties shall consult and, if they so agree, replace the arbitrator and select a replacement following the procedure set out in Article 29.7.3.
If the Parties fail to agree on the need to replace an arbitrator, any Party may request that such matter be referred to the chairperson of the arbitration panel, whose decision shall be final.
If, pursuant to such a request, the chairperson finds that an arbitrator does not comply with the requirements of the Code of Conduct, she or he shall draw a new arbitrator by lot from the names on the list referred to in Article 29.8.1 and on which the original arbitrator was included. If the original arbitrator was chosen by the Parties pursuant to Article 29.7, the replacement shall be drawn by lot from the individuals proposed by the requesting Party and by the responding Party under Article 29.8.1. The selection of the new arbitrator shall be made within five working days of the date of the submission of the request to the chairperson of the arbitration panel.
24. Where a Party considers that the chairperson of the arbitration panel does not comply with the requirements of the Code of Conduct, the Parties shall consult and, if they so agree, shall dismiss the chairperson and select a replacement following the procedure set out in 29.7.3.
If the Parties fail to agree on the need to replace the chairperson, any Party may request that such matter be referred to the two remaining arbitrators. The decision by the arbitrators on the need to replace the chairperson shall be final.
If the arbitrators decide that the chairperson does not comply with the requirements of the Code of Conduct, they shall draw a new chairperson by lot among the remaining names on the list referred to in Article 29.8.1. The selection of the new chairperson shall be made within five working days of the date of the submission of the request referred to in this paragraph.
If the arbitrators cannot reach a decision within 10 days of the matter being referred to them, the procedure set out in Article 29.7 shall apply.
25. The arbitration proceedings shall be suspended for the period taken to carry out the procedure provided for in paragraphs 21 through 24.
Hearings
26. The chairperson shall fix the date and time of the hearing in consultation with the Parties and the other arbitrators, and confirm this in writing to the Parties. This information shall also be made publicly available by the Party in charge of the logistical administration of the proceeding, subject to paragraph 39.
27. Unless the Parties agree otherwise, the hearing shall be held in Brussels if the requesting Party is Canada and in Ottawa if the requesting Party is the European Union.
28. As a general rule there should be only one hearing. The arbitration panel may on its own initiative or on the request of a Party convene one additional hearing when the dispute involves issues of exceptional complexity. No additional hearing shall be convened for the procedures established under Articles 29.14 and 29.15, except in the case of a disagreement on compliance and equivalence.
29. All arbitrators shall be present during the entirety of the hearing.
30. The following persons may attend the hearing, irrespective of whether the proceeding is open to the public or not:
(a) representatives of the Parties;
(b) advisers to the Parties;
(c) administrative staff, interpreters, translators and court reporters; and
(d) arbitrators' assistants.
Only the representatives of and advisers to the Parties may address the arbitration panel.
31. No later than five working days before the date of a hearing, each Party shall deliver to the arbitration panel and to the other Party a list of the names of natural persons who will make oral arguments or presentations at the hearing on behalf of that Party and of other representatives or advisers who will be attending the hearing.
32. The arbitration panel shall conduct the hearing in the following manner, ensuring that the requesting Party and the responding Party are afforded equal time:
Argument
(a) argument of the requesting Party
(b) argument of the responding Party
Rebuttal Argument
(a) reply of the requesting Party
(b) counter-reply of the responding Party
33. The arbitration panel may direct questions to either Party at any time during the hearing.
34. The arbitration panel, after having received the comments of the Parties, shall issue to the Parties a final transcript of each hearing.
35. Each Party may deliver to the arbitrators and to the other Party a supplementary written submission concerning any matter that arose during the hearing within 10 working days of the date of the hearing.
Questions in writing
36. The arbitration panel may at any time during the proceeding address questions in writing to one or both Parties. Each of the Parties shall receive a copy of any questions put by the arbitration panel.
37. Each Party shall also provide the other Party with a copy of its written response to the questions of the arbitration panel. Each Party shall be given the opportunity to provide written comments on the other Party's reply within five working days of the date of receipt.
Transparency and confidentiality
38. Subject to paragraph 39, each Party shall make its submissions publicly available and, unless the Parties decide otherwise, the hearings of the arbitration panel shall be open to the public.
39. The arbitration panel shall meet in closed session when the submission and arguments of a Party contain confidential business information. The Parties shall maintain the confidentiality of the arbitration panel hearings when they are held in closed session. Each Party and its advisers shall treat as confidential any information submitted by the other Party to the arbitration panel which that Party has designated as confidential. Where a Party's submission to the arbitration panel contains confidential information, that Party shall also provide, within 15 days, a non-confidential version of the submission that could be disclosed to the public.
Ex parte contacts
40. The arbitration panel shall not meet or contact a Party in the absence of the other Party.
41. No arbitrator may discuss any aspect of the subject-matter of the proceeding with a Party or the Parties in the absence of the other arbitrators.
Information and technical advice
42. Upon the request of a disputing Party, or on its own initiative, the arbitration panel may seek information and technical advice from any person or body that it deems appropriate, subject to any terms and conditions agreed by the Parties. Any information obtained in this manner must be disclosed to each Party and submitted for their comments.
Amicus curiae submissions
43. Non-governmental persons established in a Party may submit amicus curiae briefs to the arbitration panel in accordance with the following paragraphs.
44. Unless the Parties agree otherwise within five days of the date of the establishment of the arbitration panel, the arbitration panel may receive unsolicited written submissions, provided that they are made within 10 days of the date of the establishment of the arbitration panel, and in no case longer than 15 typed pages, including any annexes, and that they are directly relevant to the issue under consideration by the arbitration panel.
45. The submission shall contain a description of the person making the submission, whether natural or legal, including the nature of that person's activities and the source of that person's financing, and specify the nature of the interest that that person has in the arbitration proceeding. It shall be drafted in the languages chosen by the Parties in accordance with paragraphs 48 and 49.
46. The arbitration panel shall list in its ruling all the submissions it has received that conform to these Rules. The arbitration panel shall not be obliged to address in its ruling the arguments made in such submissions. The arbitration panel shall submit to the Parties for their comments any submission it obtains.
Urgent cases
47. In cases of urgency referred to in Article 29.11, the arbitration panel, after consulting the Parties, shall adjust the time limits referred to in these Rules as appropriate and shall notify the Parties of such adjustments.
Working language for the proceeding, translation and interpretation
48. During the consultations referred to in Article 29.7.2, and no later than the meeting referred to in paragraph 8, the Parties shall endeavour to agree on a common working language for the proceeding before the arbitration panel.
49. If the Parties are unable to agree on a common working language, each Party shall arrange for and bear the costs of the translation of its written submissions into the language chosen by the other Party. The responding Party shall arrange for the interpretation of oral submissions into the languages chosen by the Parties.
50. Arbitration panel rulings shall be issued in the language or languages chosen by the Parties.
51. Any costs incurred for translation of an arbitration panel ruling into the language or languages chosen by the Parties shall be borne equally by the Parties.
52. A Party may provide comments on the accuracy of any translated version of a document drawn up in accordance with these Rules.
Calculation of time limits
53. All time limits set out in this Chapter and in this Annex including the limits for the arbitration panels to notify their rulings, shall be counted in calendar days from the day following the act or fact to which they refer, unless otherwise specified.