For the purposes of this Chapter, the following definitions shall apply:
temporary entry: the entry of a business person of one Party into the territory of the other Party, without the intention of establishing permanent residence;
national: as defined in the Annex to this Article for the Parties indicated therein;
business person: a national of a Party who engages in trade in goods or services, or in investment activities;
in force: the binding quality of the legal provisions of the Parties at the time of entry into force of this Agreement.
Article 11-02. General Principles.
The provisions of this Chapter reflect the preferential commercial relationship between the Parties, the convenience of facilitating the temporary entry of business persons in accordance with the principle of reciprocity, and the need to establish transparent criteria and procedures for such purpose. They also reflect the need to ensure border security and to protect the labor of their nationals and permanent employment in their respective territories.
Article 11-03. General Obligations.
1. Each Party shall apply the measures relating to this Chapter in accordance with Article 11-02 and in an expeditious manner to avoid undue delay or prejudice to trade in goods and services or investment activities covered by this Agreement.
2. The Parties shall endeavor to develop and adopt common criteria, definitions and interpretations for the application of this Chapter.
Article 11-04. Authorization of Temporary Entry.
1. Each Party shall authorize, in accordance with the provisions of this Chapter, the temporary entry of business persons who comply with other applicable measures relating to health, public safety and national security.
2. A Party may deny the issuance of a migration document authorizing employment to a business person, when his temporary entry adversely affects:
(a) the settlement of any labor dispute existing in the place where he is employed or is to be employed; or
(b) the employment of any person involved in such dispute.
3. Where, in accordance with paragraph 2, a Party refuses to issue a migration document authorizing employment, that Party shall:
(a) shall inform the business person concerned in writing of the reasons for the refusal; and
(b) promptly notify in writing the Party whose national is refused entry of the reasons for the refusal.
4. Each Party shall limit the amount of the fee for processing an application for temporary entry to the approximate cost of the processing services provided.
Article 11-05. Availability of Information.
1. In addition to the provisions of Article 17-02 (Publication), each Party shall:
(a) shall provide the other Party with materials to enable it to become acquainted with the measures relating to this Chapter; and
(b) no later than one year after the date of entry into force of this Agreement, prepare, publish and make available, both in its territory and in the territory of the other Party, a consolidated document containing materials explaining the requirements for temporary entry under this Chapter, so as to enable business persons of the other Party to become acquainted with them.
2. Each Party shall compile, maintain and make available to the other Party, in accordance with its law, information relating to the granting of temporary entry authorizations in accordance with this Chapter. This compilation shall include information specific to each occupation, profession or activity.
Article 11-06. Working Group.
1. The Parties establish a Working Group on Temporary Entry, composed of representatives of each Party, including migration officials.
2. The Working Group shall meet at least once a year to review:
(a) the implementation and administration of this Chapter;
(b) the development of measures to further facilitate the temporary entry of business persons in accordance with the principle of reciprocity;
(c) the exemption from labor certification tests or procedures of similar effect for the spouse of a person who has been authorized temporary entry for more than one year pursuant to section B or C of the Annex to section 11-04; and
(d) proposed amendments or additions to this chapter.
Article 11-07. Settlement of Disputes.
1. The Parties may not initiate the procedures provided for in Article 19-05 (Intervention by the Commission - Good Offices, Conciliation and Mediation), with respect to a denial of temporary entry authorization under this Chapter, or any particular case concerning the application of the provisions of Article 11-03, unless:
(a) the matter concerns a recurring practice; and
(b) the person concerned has exhausted the administrative remedies available to him or her with respect to that particular matter.
2. The remedies referred to in paragraph 1(b) shall be deemed exhausted when the competent authority has not issued a final decision within one year from the initiation of the administrative procedure and the decision has not been delayed for reasons attributable to the business person concerned.
Article 11-08. Relationship with other Chapters.
Except as provided in this Chapter and Chapters | (Initial Provisions), XVII (Transparency) and XIX (Dispute Settlement), nothing in this Agreement shall impose any obligation on the Parties with respect to their immigration measures.
Chapter XII. Financial Services
Article 12-01. Definitions.
For the purposes of this chapter, the following definitions shall apply:
regulatory authority: any governmental entity that exercises supervisory authority over financial service suppliers or financial institutions;
public entity: a central bank or monetary authority of a Party, or any financial institution of a public nature owned or controlled by a Party;
financial institution: any enterprise or financial intermediary that is authorized to do business and is regulated or supervised as a financial institution under the laws of the Party in whose territory it is located;
financial institution of the other Party: a financial institution, including a branch, incorporated under applicable law, located in the territory of a Party that is controlled by persons of the other Party;
investment:
(a) an enterprise;
(b) shares of an enterprise;
(c) debt instruments of an enterprise:
(i) when the enterprise is an affiliate of the investor; or
(ii) where the original maturity date of the debt instrument is at least three years, but does not include a debt instrument of a state enterprise, regardless of the original maturity date;
(d) a loan to an enterprise:
(i) when the enterprise is a subsidiary of the investor; or
(ii) when the original maturity date of the loan is at least three years, but does not include a loan to a state enterprise, regardless of the original maturity date;
(e) an interest in an enterprise, which allows the owner to participate in the income or profits of the enterprise;
(f) an interest in an enterprise, which entitles the owner to share in the assets of that enterprise in a liquidation, provided that the liquidation does not arise from an obligation or a loan excluded under c) and d);
(g) real estate or other property, tangible or intangible, acquired or used for the purpose of obtaining an economic benefit or for other business purposes;
(h) benefits derived from allocating capital in other resources for the development of an economic activity in the territory of the other Party, among others, pursuant to:
(i) contracts involving the presence of an investor's property in the territory of the other Party, including concessions, construction and turnkey contracts; or;
(ii) contracts involving the presence of an investor's property in the territory of the other Party, including concessions, construction and turnkey contracts; or
(iii) contracts where the remuneration is substantially dependent on the production, revenues or profits of an enterprise; and
(i) a loan provided by or a debt security owned by a cross-border financial services provider, except a loan to or a debt security issued by a financial institution;
investment does not mean:
(j) pecuniary claims that do not involve the types of rights set forth in subparagraphs (a) through (i) arising solely from:
(i) commercial contracts for the sale of goods or services by a national or enterprise in the territory of one Party to an enterprise in the territory of the other Party; or
(ii) the extension of credit in connection with a commercial transaction, such as trade financing, other than a loan covered by the provisions of subparagraph (d);
k) any other pecuniary claim that does not involve the types of fees provided for in subparagraphs a) through i);
l) a loan to a financial institution or a debt security owned by a financial institution, other than a loan to a financial institution that is treated as equity for regulatory purposes by any Party in whose territory the financial institution is located; or
m) a loan to, or a debt security issued by, a Party or a state enterprise of that Party;
investment of an investor of a Party: an investment owned or controlled directly or indirectly by an investor of a Party;
investor of a Party: a Party or an enterprise of the State of that Party, or a person of that Party that intends to make, makes, or has made an investment;
disputing investor: an investor that submits a claim to arbitration under this Chapter and Section B of Chapter XV (Investment);
new financial service: a financial service not provided in the territory of a Party that is provided in the territory of the other Party, including any new form of distribution of a financial service or sale of a financial product that is not sold in the territory of the Party;
self-regulatory body: a non-governmental entity, including a securities or futures exchange or market, clearing house or any other association or organization that exercises proprietary or delegated regulatory or supervisory authority over financial service suppliers or financial institutions;
person of a Party: a national or company of a Party and, for greater certainty, does not include a branch of a company of a non-Party;
cross-border supply of financial services or cross-border trade in financial services means the supply of a financial service:
(a) from the territory of a Party into the territory of the other Party;
(b) in the territory of a Party, by a person of that Party to a person of the other Party; or
(c) by a person of a Party into the territory of the other Party;
financial service supplier of a Party: a person of a Party that is engaged in the business of supplying any financial service in the territory of the other Party;
cross-border financial service supplier of a Party: a person of a Party that is engaged in the business of supplying financial services in its territory and intends to or does engage in the cross-border supply of financial services;
financial service means a service of a financial nature and any related or auxiliary service, including:
(a) all insurance and insurance-related services, including:
(i) direct insurance, including coinsurance;
(ii) life, property, casualty and health insurance;
(iii) reinsurance and retrocession;
(iv) insurance intermediation activities, such as insurance brokers and agents; and
(v) services auxiliary to insurance, such as those provided by consultants and actuaries, risk assessment and claim settlement;
(b) all banking and other financial services, including, but not limited to:
(i) acceptance of deposits and other repayable funds from the public;
(ii) lending of all types, including personal loans, mortgage loans, financial factoring, and financing of commercial transactions;
(iii) financial leasing services;
(iv) all payment and money transfer services, including credit, debit and similar cards, traveler's checks and bankers' drafts;
(v) guarantees and commitments;
(vi) trading for its own account or for the account of customers, whether on an exchange, over-the-counter or otherwise through:
- money market instruments, including checks, bills and certificates of deposit;
- foreign exchange;
- derivative products, including futures and options;
- exchange and money market instruments, such as swaps and forward rate agreements; - transferable securities; or
- other negotiable instruments and financial assets, including metals;
(vii) participation in issues of all kinds of securities, including underwriting and placement as agents and the provision of services related to such issues;
(viii) foreign exchange brokerage;
(ix) asset management including cash or portfolio management, collective investment management in all its forms, pension fund management, depository and custodial trust services;
(x) payment and clearing services in respect of financial assets, including securities, derivatives and other negotiable instruments;
(xi) provision and transfer of financial information and financial data processing and related software by suppliers of other financial services;
(xii) advisory, intermediation and other auxiliary financial services with respect to any of the activities listed in subparagraphs (i) through (xi), including credit reports and analysis, investment and portfolio research and advice, and advice on acquisitions, restructuring and corporate strategy.
Article 12-02. Scope of Application.
1. This Chapter applies to measures adopted or maintained by a Party relating to:
(a) financial institutions of the other Party;
(b) investors of a Party and investments of those investors in financial institutions in the territory of the other Party; and
(c) cross-border trade in financial services.
2. Nothing in this Chapter shall be construed to prevent a Party, or its public entities, from exclusively conducting or providing in its territory:
(a) activities conducted by monetary authorities or by any other public institution, aimed at the pursuit of monetary or exchange rate policies;
(b) activities and services forming part of public retirement plans or compulsory social security systems; or
(c) other activities or services on behalf of the Party, with its guarantee, or using the financial resources of the Party or its public entities.
3. The Parties undertake to liberalize among themselves, progressively and gradually, any financial restrictions or reservations for the purpose of making effective economic complementation between them.
4. The provisions of this Chapter shall prevail over those of other Chapters, except in cases where express reference is made to those Chapters.
Article 12-03. Self-Regulatory Bodies.
Where a Party requires a financial institution or cross-border financial service provider of the other Party to be a member of, participate in, or have access to a self-regulatory body in order to offer a financial service in or into its territory, the Party shall use its best efforts to ensure that such body complies with the obligations of this Chapter.
Article 12-04. Right of Establishment.
1. The Parties recognize the principle that investors of a Party engaged in the business of supplying financial services in its territory should be permitted to establish a financial institution in the territory of the other Party, through any of the modes of establishment and operation permitted by the other Party.
2. Each Party may impose, at the time of establishment, terms and conditions that are consistent with Article 12-06.
Article 12.-05. Cross-Border Trade.
1. No Party shall increase restrictions on its measures relating to cross-border trade in financial services by cross-border financial service suppliers of the other Party upon the entry into force of this Agreement.
2. Each Party shall permit persons located in its territory and its nationals, wherever located, to purchase financial services from cross-border financial service suppliers of the other Party located in the territory of that other Party. This does not oblige a Party to allow such suppliers to do business or advertise in its territory. Subject to paragraph 1, each Party may define "doing business" and "advertising" for purposes of this obligation.
3. Without prejudice to other means of prudential regulation of cross-border trade in financial services, a Party may require the registration of cross-border financial service suppliers of the other Party and of financial instruments.
Article 12-06. National Treatment.
1. In like circumstances, each Party shall accord to investors of the other Party treatment no less favorable than that it accords to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, sale, and other forms of disposal of financial institutions and investments in financial institutions in its territory.
2. In like circumstances, each Party shall accord to financial institutions of the other Party and to investments of investors of the other Party in financial institutions, treatment no less favorable than that it accords to its own financial institutions and to investments of its own investors in financial institutions with respect to the establishment, acquisition, expansion, management, conduct, operation, sale and other disposition of financial institutions and investments.
3. In like circumstances, under Article 12-05, where a Party permits the cross-border supply of a financial service, it shall accord to financial service suppliers of the other Party treatment no less favorable than that it accords to its own financial service suppliers with respect to the supply of that service.
4. Treatment accorded by a Party to financial institutions and cross-border financial service suppliers of the other Party, whether identical to or different from that accorded to its own institutions or service suppliers in like circumstances, is consistent with paragraphs 1 through 3 if it provides equal opportunity to compete.
5. A Party's treatment does not afford equal opportunity to compete if, in like circumstances, it would disadvantage the financial institutions and cross-border financial service suppliers of the other Party in their ability to supply financial services compared to the ability of the Party's own financial institutions and service suppliers to supply such services.
Article 12-07. Most-Favored-Nation Treatment.
Each Party shall accord to investors of the other Party, to financial institutions of the other Party, to investments of investors in financial institutions and to cross-border financial service suppliers of the other Party, treatment no less favorable than that accorded to investors, to financial institutions, to investments of investors, to financial institutions and to cross-border financial service suppliers of the other Party or of a non-Party, in like circumstances.
Article 12-08. Recognition and Harmonization.
1. In applying the measures covered by this Chapter, each Party may recognize the prudential measures of the other Party or a non-Party. Such recognition may be:
(a) granted unilaterally;
(b) achieved through harmonization or other means; or
(c) based on an agreement with the other Party or a non-Party.
2. The Party granting recognition of prudential measures pursuant to paragraph 1 shall provide appropriate opportunities for the other Party to demonstrate that there are circumstances under which equivalent regulations exist or will exist, supervision and enforcement of the regulation and, if appropriate, procedures for sharing information between the Parties.
3. Where a Party grants recognition of prudential measures pursuant to paragraph 1 and the circumstances set out in paragraph 2 exist, that Party shall provide adequate opportunity for the other Party to negotiate accession to the agreement, or to negotiate a similar agreement.
Article 12-09. Exceptions.
1. Nothing in this Chapter shall be construed to prevent a Party from adopting or maintaining reasonable measures for prudential reasons, such as:
(a) protecting investors, depositors, financial market participants, policy holders or beneficiaries, or persons owing fiduciary duties to a financial institution or cross-border financial service provider;
(b) to maintain the safety, soundness, integrity or financial responsibility of financial institutions or cross-border financial service providers; and
(c) ensuring the integrity and stability of a Party's financial system.
2. Nothing in this Chapter applies to non-discriminatory measures of general application adopted by a public entity in the conduct of monetary or related credit or exchange rate policies. This paragraph shall not affect the obligations of any Party arising from investment performance requirements with respect to measures covered by Chapter XV (Investment) or Article 12-17.
3. Article 12-06 shall not apply to the granting of exclusivity rights by a Party to a financial institution to supply a financial service referred to in paragraph 2(a) of Article 12-02.
4. Notwithstanding paragraphs 1 through 3 of Article 12-17, a Party may prevent or limit transfers by, or for the benefit of an affiliate or related person of, a financial institution or cross-border financial service supplier through the fair and non-discriminatory application of measures relating to the maintenance of the safety, soundness, integrity or financial responsibility of financial institutions or cross-border financial service suppliers. The provisions of this paragraph shall be without prejudice to any other provision of this Agreement that permits a Party to restrict transfers.