Title
Chile - Vietnam Free Trade Agreement
Preamble
The Government of the Republic of Chile and the Government of the Socialist Republic of Viet Nam, hereinafter referred to as "the Parties":
Inspired by their longstanding friendship and cooperation and growing trade relationship;
Desiring to enlarge the framework of relations between them through further liberalising trade;
Recognising that the strengthening of their economic partnership will bring economic and social benefits, create new opportunities for employment and improve the living standards of their people;
Recognising the different levels of economic development between them and the need to facilitate the expansion of their exports, including, inter alia, through strengthening of their domestic capacity, efficiency and competitiveness;
Building on their respective rights and obligations under the World Trade Organization (WTO);
Recalling the Asia-Pacific Economic Cooperation (APEC) goals;
Confirming their shared commitment to trade-facilitation through trade between them;
Desiring to strengthen the cooperative framework for the conduct of economic relations to ensure it is dynamic and encourages broader and deeper economic cooperation;
Recognising the need to preserve their flexibility to safeguard the public welfares;
Aware that economic development, social development and environmental protection are components of sustainable development and that free trade agreements can play an important role in promoting sustainable development; and
Resolved to promote bilateral trade through the establishment of clear and mutually advantageous trade rules and the avoidance of trade barriers,
Have agreed as follows:
Body
Chapter 1. Initial Provisions
Article 1.1. Establishment of a Free Trade Area
The Parties, consistent with Article XXIV of GATT 1994 hereby establish a free trade area.
Article 1.2. Relation to other Agreements
The Parties affirm their existing rights and obligations with respect to each other under the WTO Agreement and other agreements to which both Parties are party.
Chapter 2. General Definitions
Article 2.1. Definitions of General Application
For the purposes of this Agreement, unless otherwise specified:
Agreement on Customs Valuation means the Agreement on Implementation of Article VII of the General Agreement on Tariff and Trade 1994, contained in Annex 1A to the WTO Agreement;
Commission means the Free Trade Commission established pursuant to Article 11.1 (Free Trade Commission);
Customs Authority means the authority that, according to the legislation of each Party, is responsible for the administration and enforcement of its customs laws:
(a) in the case of Chile, the Chile Customs Service, and
(b) in the case of Viet Nam, the General Department of Viet Nam Customs;
customs duties means duties imposed in connection with the importation of a good provided that such customs duties shall not include:
(a) charges equivalent to internal taxes, including excise duties, sales tax, and goods and services taxes imposed in accordance with a Party's commitments under paragraph 2 of Article III of the GATT 1994;
(b) anti-dumping or countervailing duty or safeguards duty applied in accordance with Chapter 8 (Trade Remedies); or
(c) fees or other charges that are limited in amount to the approximate cost of services rendered, and do not represent a direct or indirect protection for domestic goods or a taxation of imports for fiscal purposes; days means calendar days, including weekends and holidays;
GATT 1994 means the General Agreement on Tariffs and Trade 1994, contained in Annex 1A of the WTO Agreement;
Harmonized System (HS) means the Harmonized Commodity Description and Coding System governed by The International Convention on the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, and their amendments, as adopted and implemented by the Parties in their respective tariff laws;
heading means the first four digits in the tariff classification number under the Harmonised System (HS);
measure means any measure by a Party, whether in the form of a law, regulation, rule, procedure, practice, decision, administrative action or any other form;
originating goods means the goods that qualify as originating goods in accordance with Chapter 4 (Rules of Origin);
person means both natural and legal persons;
publish includes publication in written form or on the internet;
SPS Agreement means the WTO Agreement on the Application of Sanitary and Phytosanitary Measures;
subheading means the first six digits in the tariff classification number under the Harmonised System (HS);
territory means:
(a) with respect to Chile, the land, maritime, and air space under its sovereignty, and the exclusive economic zone and the continental shelf within which it exercises sovereign rights and jurisdiction in accordance with international law and its domestic law; and
(b) with respect to Viet Nam, the land territory, islands, internal waters, territorial sea, and airspace above them, the maritime areas beyond territorial sea including seabed and subsoil thereof over which the Socialist Republic of Viet Nam exercises sovereign rights and jurisdiction in accordance with national legislation and international law. WTO means the World Trade Organization; and
WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done on April 15, 1994.
Chapter 3. Trade In Goods
Article 3.1. Definitions
For the purposes of this Chapter:
Agreement on Agriculture means the WTO Agreement on Agriculture contained in Annex 1A of the WTO Agreement;
agricultural goods means those goods referred to in Article 2 of the Agreement on Agriculture;
agricultural export subsidies shall have the meaning assigned to that term in Article 1(e) of the Agriculture Agreement, including any amendment of that Article;
consular transactions means requirements that goods of a Party intended for export to the territory of the other Party must first be submitted to the supervision of the Consul of the importing Party in the territory of the exporting Party for the purpose of obtaining consular invoices or consular visas for commercial invoices, certificates of origin, manifests, shippers' export declarations, or any other customs documentation required on or in connection with importation;
import licensing means an administrative procedure requiring the submission of an application or other documentation (other than that generally required for customs clearance purposes) to the relevant administrative body as a prior condition for importation into the territory of the importing Party;
performance requirement means a requirement that:
(a) a given level or percentage of goods be exported;
(b) goods of the Party granting an import license be substituted for imported goods;
(c) a person benefiting from an import license purchase other goods or services in the territory of the Party granting the import licence, or accord a preference to domestically produced goods;
(d) a person benefiting from an import licence produce goods or supply services, in the territory of the Party granting the import licence, with a given level or percentage of domestic content; or
(e) relates in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows;
recognition means the acknowledgement by a Party of a particular geographical indication of the other Party. Protection of such geographical indication in the territory of each Party is established according to the respective domestic laws and regulations of each Party; and
TRIPS Agreement means the Agreement on Trade-Related Aspects of Intellectual Property Rights, contained in Annex 1C of the WTO Agreement.
Article 3.2. Scope and Coverage
Except as otherwise provided, this Chapter applies to trade in goods of a Party.
Article 3.3. National Treatment
1. Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of GATT 1994, including its interpretative notes, and to this end, Article III of GATT 1994 and its interpretative notes, are incorporated into and made part of this Agreement, mutatis mutandis.
2. The provisions of paragraph 1 regarding national treatment shall also apply to all laws, regulations and other measures, including those of local government at the subnational level.
Article 3.4. Reduction and/or Elimination of Customs Duties
1. Except as otherwise provided in this Agreement, neither Party may increase any existing customs duty, or adopt any new customs duty, on an originating good.
2. Except as otherwise provided in this Agreement, each Party shall progressively reduce and/or eliminate its customs duties on originating goods in accordance with its Schedule in Annex 3-B.
3. If a Party reduces its applied MFN import duty rates after the entry into force of this Agreement, on the request of the other Party, Parties shall consult to consider the modification of the tariff commitments in the Committee on Trade in Goods pursuant to Article 3.12(4).
4. On the request of either Party, the Parties shall consult to consider accelerating the reduction and/or elimination of customs duties set out in their Schedules in Annex 3 B. An agreement between the Parties to accelerate the reduction and/or elimination of a customs duty on a good shall supersede any duty rate or staging category determined pursuant to their Schedules in Annex 3-B for such good.
5. Any modification of tariff commitments, referred to in paragraphs 3 and 4, shall come into effect after being adopted by the Commission and after each Party completes its domestic legal procedures.
6. A Party may at any time accelerate unilaterally the reduction and/or elimination of customs duties on originating goods of the other Party set out in its Schedule in Annex 3-B. A Party considering this shall inform the other Party as early as practicable before the new rate of customs duty takes effect.
Article 3.5. Customs Valuation
The Parties shall apply the provisions of Article VII of GATT 1994 and the WTO Agreement on the Implementation of Article VII of GATT 1994 for the purposes of determining the customs value of goods traded between the Parties.
Article 3.6. Import and Export Restrictions
1. Except as otherwise provided in this Agreement, neither Party may adopt or maintain any non-tariff measure, including prohibition or restriction on the importation of any good of another Party or on the exportation of any good destined for the territory of the other Party, except in accordance with its WTO rights and obligations or in accordance with other provisions of this Agreement.
2. The Parties understand that the rights and obligations in paragraph 1 prohibit, in any circumstances in which any other form of restriction is prohibited, a Party from adopting or maintaining:
(a) import licensing conditioned on the fulfillment of a performance requirement; or
(b) voluntary export restraints.
3. Paragraphs 1 and 2 shall not apply to the measures set out in Annex 3-A.
4. Each Party shall ensure the transparency of any non-tariff measures permitted in paragraph 1 and shall ensure that any such measures are not prepared, adopted or applied with a view to, or with the effect of, creating unnecessary obstacles to trade between the Parties.
Article 3.7. Administrative Fees and Formalities
1. The Parties agree that fees, charges, formalities and requirements imposed in connection with the importation and exportation of goods shall be consistent with their obligations under GATT 1994.
2. A Party may not require consular transactions, including related fees and charges, in connection with any good imported from the other Party.
3. Each Party shall make available through the internet a current list of the fees and charges it imposes in connection with importation or exportation.
Article 3.8. Price Band System
1. Chile may maintain its Price Band System as established under its Law 18.525 and its subsequent legal modifications or succeeding system for the goods covered by that law (1), provided that it is applied consistently with Chile's rights and obligations under the WTO Agreement.
2. With respect to the goods covered by the Price Band System, Chile shall give Viet Nam treatment no less favorable than the preferential tariff treatment given to any third country including countries with which Chile has concluded or will conclude in the future an agreement notified under Article XXIV of GATT 1994.
Article 3.9. Agricultural Export Subsidies
1. The Parties share the objective of the multilateral elimination of export subsidies for agricultural goods and shall work together towards an agreement in the WTO to eliminate those subsidies and prevent their reintroduction in any form.
2. In accordance with their WTO obligations, neither Party shall introduce or maintain any export subsidies on any agricultural goods destined for the territory of the other Party.
Article 3.10. Geographical Indications
1. Each Party shall provide procedures for registration of geographical indications for persons of the other Party. A Party shall accept applications for registration of geographical indications without the requirement for intercession by the other Party on behalf of its persons.
2. Viet Nam recognizes Pisco, accompanied by an indication of Chile such as Chilean, Chile, etc.; as a Chilean geographical indication for spirits, within the meaning of paragraph 1 of Article 22 of the TRIPS Agreement. This shall not prejudice the rights that Viet Nam has recognized, in addition to Chile, to Peru with respect to Pisco.
3. In accordance with Chapter 9 (Cooperation), Chile will provide capacity building to Viet Nam regarding the knowledge of production, elaboration and commercialization of Pisco.
4. For transparency purposes, Chilean geographical indications for wines and spirits are established by Decree 464 of the Ministry of Agriculture of December 14, 1994, and its amendments, and by the Law 18.455.
Article 3.11. Administration of Trade Regulations
In accordance with Article X of GATT 1994, each Party shall administer in a uniform, impartial and reasonable manner all its laws, regulations, judicial decisions and administrative rulings pertaining to:
(a) the classification or the valuation of goods for customs purposes;
(b) rates of duty, taxes or other charges;
(c) requirements, restrictions or prohibitions on imports or exports;
(d) the transfer of payments; and
(e) issues affecting sale, distribution, transportation, insurance, warehousing, inspection, exhibition, processing, mixing or other use of goods for customs purposes.
Article 3.12. Committee on Trade In Goods
1. The Parties hereby establish a Committee on Trade in Goods, comprising representatives of each Party.
2. The Committee shall meet on the request of either Party or the Commission to consider any matter arising under this Chapter, Chapter 4 (Rules of Origin) or Chapter 5 (Customs Administration).
3. The Committee shall meet at such venues and times as may be agreed by the Parties. Meetings may be held by any means as mutually determined by the Parties.
4. The Committee's functions shall include:
(a) reviewing and monitoring the implementation and operation of the Chapters referred to in paragraph 2;
(b) identifying and recommending measures to resolve any difference that may arise, and to promote and facilitate improved market access, including any acceleration of tariff commitments under Article 3.4;
(c) recommending the Commission to establish any working groups, as it deems necessary; and
(d) undertaking any additional work that the Commission may assign.
Chapter 4. Rules of Origin
Article 4.1. Definitions
For the purposes of this Chapter:
aquaculture means the farming of aquatic organisms including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants, from feedstock such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production such as regular stocking, feeding, or protection from predators;
CIF means the value of the goods imported, and includes the costs of freight and insurance up to the port or place of entry into the country of importation;
FOB means the free-on-board value of the goods, inclusive of the costs of transport to the port or site of final shipment abroad;
generally accepted accounting principles (GAAP) means the recognised consensus or substantial authoritative support in the territory of a Party, with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These standards may encompass broad guidelines of general application as well as detailed standards, practices and procedures;
goods shall include materials or products, which can be wholly obtained or produced, even if they are intended for later use as materials in another production process;
identical and interchangeable goods or materials means goods or materials being of the same kind and commercial quality, possessing the same technical and physical characteristics, and which after being incorporated into the finished product cannot be distinguished from one another for origin purposes by virtue of any markings or mere visual examination;
issuing authority means the government authority responsible for the certification of origin:
(a) in the case of Chile, the General Directorate of International Economic Affairs who may delegate into other bodies or entities the issuance of Certificate of Origin (Form VC); and
(b) in the case of Viet Nam, the Ministry of Industry and Trade;
materials means a good or any matter or substance used or consumed in the production of goods or physically incorporated into another good or are subject to a process in the production of another good;
originating goods means goods that qualifies as originating in accordance with the provisions of this Chapter;
packing materials and containers for transportation means the goods used to protect a good during its transportation, different from those containers or packaging materials used for its retail sale;
production means methods of obtaining goods, including growing, mining, harvesting, raising, breeding, extracting, gathering, collecting, capturing, fishing, trapping, hunting, manufacturing, processing or assembling goods; and
product specific rules means rules that specify that the materials have undergone a change in tariff classification, or satisfy a Regional Value Content criterion or a combination of any of these criteria.
Article 4.2. Origin Criteria
For the purposes of this Chapter, a good shall be considered as originating in a Party when:
(a) a good is wholly obtained or produced in the Party as set out and defined in Article 4.3; or
(b) a good is not wholly obtained or produced in the Party, provided that the said good are eligible under Article 4.4 or Article 4.6.
Article 4.3. Wholly Obtained or Produced Goods
Within the meaning of Article 4.2(a), the following shall be considered as wholly obtained or produced in the Party:
(a) Plant and plant products, including fruit, flowers, vegetables, trees, seaweed, fungi and live plants, grown and harvested, picked or gathered in the Party;
(b) Live animals, including mammals, birds, fish, crustaceans, molluscs, reptiles, bacteria and viruses, born and raised in the Party;
(c) Goods obtained from live animals referred to in paragraph (b) in the Party;
(d) Goods obtained from hunting, trapping, fishing, farming, aquaculture, gathering or capturing conducted in the Party;
(e) Minerals and other naturally occurring substances, not included in paragraphs (a) to (d), extracted or taken from its soil, waters, seabed or beneath its seabed;
(f) Goods taken from the waters, seabed or beneath the seabed outside the territorial waters of that Party, provided that the Party has the rights to exploit such waters, seabed and beneath the seabed in accordance with international law;
(g) Goods of sea-fishing and other marine products taken from the high seas by vessels registered with a Party and entitled to fly the flag of that Party;
(h) Goods processed and/or made on board factory ships registered with a Party and entitled to fly the flag of that Party, exclusively from products referred to in paragraph (f) and (g);
(i) Articles collected in the Party which can no longer perform their original purpose nor are capable of being restored or repaired and are fit only for disposal or recovery of parts of raw materials, or for recycling purposes;
(j) Waste and scrap derived from:
(i) production in the Party; or