serious injury means a significant overall impairment of a domestic industry;
substantial cause means a cause that is important and not less important than any other cause;
threat of serious injury means serious injury that is clearly imminent based on facts and not based on allegation, conjecture or remote possibility; and
transition period means the 10-year period beginning on the entry into force of this Agreement, except where the tariff elimination for the good against which the action is taken occurs over a longer period of time, in which case the transition period is the period of the staged tariff elimination for that good.
Article 8.02. Global Safeguard Measures
1. Each Party retains its rights and obligations under Article XIX of the GATT 1994 and the Agreement on Safeguards, which shall exclusively govern global safeguard actions, including the resolution of a dispute in respect thereof.
2. This Agreement does not confer additional rights or obligations on the Parties with regard to actions taken pursuant to Article XIX of the GATT 1994 and the Agreement on Safeguards, except that a Party taking a global safeguard measure may exclude imports of an originating good of the other Party if the competent investigating authority of that Party concludes that those imports are not a substantial cause of serious injury or threat thereof.
3. A Party may not adopt or maintain with respect to the same good at the same time:
(a) an emergency action; and
(b) a measure pursuant to Article XIX of the GATT 1994 and the Agreement on Safeguards.
Article 8.03. Bilateral Emergency Actions
1. A Party may adopt an emergency action described in paragraph 2:
(a) only during the transition period; and
(b) if as a result of the reduction or elimination of a duty pursuant to this Agreement an originating good is being imported into the Party's territory in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to constitute a substantial cause of serious injury, or threat thereof, to a domestic industry producing a like or directly competitive good.
2. If the conditions set out in paragraph 1 and Articles 8.04 and 8.05 are met, a Party may to the extent necessary to prevent or remedy serious injury, or threat thereof, and to facilitate adjustment:
(a) suspend the further reduction of a rate of duty provided for under this Agreement on the good; or
(b) increase the rate of duty on the good to a level not exceeding the lesser of:
(i) the most-favoured-nation (MFN) rate of duty in effect at the time the emergency action is taken, and
(iii) the base rate of duty as provided in the schedule to Annex 2.04 (National Treatment and Market Access for Goods - Tariff Elimination).
Article 8.04. Notification and Discussions
1. A Party shall, in writing, promptly notify and invite for discussions the other Party in connection with:
(a) initiating an emergency action proceeding;
(b) making a finding of serious injury, or threat thereof, under the conditions set out in Article 8.03(1); and
(c) applying an emergency action.
2. A Party shall without delay, provide to the other Party a copy of the public version of any notice or any report by a competent investigating authority issued in connection with matters notified pursuant to paragraph 1.
3. If a Party accepts an invitation for discussions made pursuant to paragraph 1, the Parties shall enter into discussions to review the notification under paragraph 1 or the public version of a document issued by a competent investigating authority in connection with the emergency action proceeding.
4. An emergency action shall be initiated no later than 1 year after the date the proceeding is instituted.
Article 8.05. Standards for Emergency Actions
1. A Party may not maintain an emergency action:
(a) for a period exceeding 3 years, including any extension; or
(b) beyond the expiration of the transition period.
2. A Party may not apply an emergency action against a good more than once.
3. On the termination of an emergency action, a Party shall set the rate of duty at the rate that would have been in effect but for the action according to the Party's Schedule to Annex 2.04 (National Treatment and Market Access for Goods - Tariff Elimination) for the staged elimination of the tariff.
4. A Party may take an emergency action under Article 8.03 after the expiration of the transition period to deal with cases of serious injury, or threat thereof, to a domestic industry arising from the operation of this Agreement only with the consent of the other Party.
5. A Party taking an emergency action under Article 8.03 shall provide to the exporting Party mutually accepted trade liberalizing compensation in the form of concessions with substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the action. If the Parties are unable to decide on compensation, the Party whose goods are subject to the action may take tariff action with trade effects substantially equivalent to the emergency action taken under Article 8.03. The Party taking the tariff action shall apply the action only for the minimum period necessary to achieve the substantially equivalent effects and, in any event, only while the emergency action under Article 8.03 is in effect.
Article 8.06. Administration of Emergency Action Proceedings
1. Each Party shall ensure the consistent, impartial and reasonable administration of its laws, regulations, decisions and rulings governing emergency action proceedings.
2. Each Party shall entrust determinations of serious injury, or threat thereof, in an emergency action proceeding to a competent investigating authority. Each Party shall:
(a) ensure that those determinations are subject to review by judicial or administrative tribunals, to the extent provided by domestic law;
(b) ensure that negative injury determinations are not modified, except through a review referred to in subparagraph (a); and
(c) provide its competent investigating authority with the necessary resources to enable it to fulfill its duties.
3. Each Party shall adopt or maintain equitable, timely, transparent and effective procedures for emergency action proceedings in accordance with the requirements set out in paragraph 4.
4. A Party shall apply an emergency action only following an investigation by the Party's competent investigating authority in accordance with Articles 3 and 4.2 of the Agreement on Safeguards. To this end, Articles 3 and 4.2 of the Agreement on Safeguards are incorporated into and made part of this Agreement.
Chapter Nine. Investment
Section A. Definitions
Article 9.01. Definitions
For purposes of this Chapter:
confidential information means confidential business information or information that is privileged or otherwise protected from disclosure;
covered investment means, with respect to a Party, an investment in its territory of an investor of the other Party existing on the date of entry into force of this Chapter, or investments made or acquired thereafter;
disputing investor means an investor that makes a claim under Section C;
disputing Party means a Party against which a claim is made under Section C;
disputing party means the disputing investor or the disputing Party;
enterprise means an enterprise as defined in Article 1.01 (Initial Provisions and General Definitions - Definitions of General Application) and a branch of any such entity;
ICSID Additional Facility Rules means the Rules Governing the Additional Facility for the Administration of Proceedings by the Secretariat of the International Centre for Settlement of Investment Disputes;
ICSID Convention means the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, done at Washington on 18 March 1965;
intellectual property rights means copyright and related rights, trademark rights, rights in geographical indications, rights in industrial designs, patent rights, rights in layout designs of integrated circuits, rights in relation to protection of undisclosed information and plant breeders' rights;
investment means:
(a) an enterprise;
(b) a share, stock and other form of equity participation in an enterprise;
(c) a bond, debenture, and other debt instrument of an enterprise;
(d) a loan to an enterprise;
(e) an interest in an enterprise that entitles the owner to a share in income or profits of the enterprise;
(f) an interest in an enterprise that entitles the owner to a share in the assets of that enterprise on dissolution;
(g) interests arising from the commitment of capital or other resources in the territory of a Party to economic activity in that territory, such as under:
(i) a contract involving the presence of an investor's property in the territory of the Party, including a turnkey or construction contract, or a concession, or
(ii) a contract where remuneration depends substantially on the production, revenues or profits of an enterprise;
(h) intellectual property rights; and
(i) any other tangible or intangible, movable or immovable, property and related property rights acquired in the expectation or used for the purpose of economic benefit or other business purpose;
but investment does not mean:
(j) a claim to money that arises solely from:
(i) a commercial contract for the sale of a good or service by a national or enterprise in the territory of a 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 subparagraph (d); or
(k) any other claim to money,
that does not involve the kinds of interests set out in subparagraphs (a) to (i);
investment of an investor of a Party means an investment owned or controlled directly or indirectly by an investor of that Party;
investor of a non-Party means an investor other than an investor of a Party, that seeks to make, is making, or has made, an investment; for greater certainty, an investor "seeks to make an investment" only when the investor has taken concrete steps necessary to make the investment, such as when the investor has made an application for a permit or license authorizing the establishment of an investment;
investor of a Party means a Party or state enterprise, or a national or an enterprise of a Party, that seeks to make, is making, or has made, an investment; for greater certainty, an investor "seeks to make an investment" only when the investor has taken concrete steps necessary to make the investment, such as when the investor has made an application for a permit or license authorizing the establishment of an investment;
non-disputing Party means the Party that is not a party to an investment dispute;
Secretary-General means the Secretary-General of ICSID; and
UNCITRAL Arbitration Rules means the arbitration rules of the United Nations Commission on International Trade Law.
Section B. Investment
Article 9.02. Scope of Application
1. This Chapter applies to measures adopted or maintained by a Party relating to:
(a) an investor of the other Party;
(b) a covered investment; and
(c) with respect to Articles 9.07, 9.16 and 9.17, an investment in its territory.
2. This Chapter does not apply to an act or fact that took place or a situation that ceased to exist before the date of entry into force of this Agreement.
Article 9.03. Relation to other Chapters
1. In the event of an inconsistency between this Chapter and another Chapter, the other Chapter prevails.
2. A requirement by a Party that a service provider of the other Party post a bond or other form of financial security as a condition of providing a service to its territory does not of itself make this Chapter applicable to that cross-border service. This Chapter applies to that Party's treatment of the posted bond or financial security if the bond or financial security is a covered investment.
3. This Chapter does not apply to a measure adopted or maintained by a Party to the extent that the measure is covered by Chapter Twelve (Financial Services).
4, Articles 10.05 (Cross-Border Trade in Services - Market Access) and 10.08 (Cross-Border Trade in Services - Domestic Regulation) are incorporated into and made a part of this Chapter and apply to a measure adopted or maintained by a Party when that measure affects the supply of a service in its territory by a covered investment.
5. A reservation taken by a Party under Article 10.07 (Cross-Border Trade in Services - Reservations) against Article 10.05 (Cross-Border Trade in Services - Market Access) applies to a measure of that Party covered under paragraph 4.
Article 9.04. National Treatment
1. Each Party shall accord to an investor of the other Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of an investment in its territory.
2. Each Party shall accord to a covered investment treatment no less favourable than that it accords, in like circumstances, to investments of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of an investment in its territory.
3. The treatment accorded by a Party under paragraphs 1 and 2 means, with respect to a sub-national government, treatment no less favourable than the treatment accorded in like circumstances by that sub-national government to investors and to investments of investors of the Party of which it forms a part.
Article 9.05. Most-Favoured-Nation Treatment
1. Each Party shall accord to an investor of the other Party treatment no less favourable than that it accords, in like circumstances, to investors of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of an investment in its territory.
2. Each Party shall accord to a covered investment treatment no less favourable than that it accords in like circumstances to investments of investors of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of an investment in its territory.
3. For greater certainty, the treatment accorded by a Party under this Article means, with respect to a sub-national government, treatment accorded, in like circumstances, by that sub-national government to investors, and to investments of investors, of a non- Party.
Article 9.06. Minimum Standard of Treatment
1. Each Party shall accord to a covered investment treatment in accordance with the customary international law minimum standard of treatment of aliens, including fair and equitable treatment and full protection and security.
2. The concepts of "fair and equitable treatment" and "full protection and security" in paragraph 1 do not require treatment in addition to or beyond that which is required by the customary international law minimum standard of treatment of aliens.
3. A breach of another provision of this Agreement, or of a separate international agreement, does not establish that there has been a breach of this Article.
Article 9.07. Performance Requirements
1. A Party may not impose or enforce the following requirements, or enforce a commitment or undertaking, in connection with the establishment, acquisition, expansion, management, conduct or operation of an investment of an investor of a Party or a non-Party in its territory:
(a) to export a given level or percentage of a good or service;
(b) to achieve a given level or percentage of domestic content;
(c) to purchase, use or accord a preference to a good produced or service provided in its territory, or to purchase a good or service from a person in its territory;
(d) to relate the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with that investment;
(e) to restrict sales of a good or service in its territory that the investment produces or provides by relating those sales in any way to the volume or value of its exports or foreign exchange earnings;
(f) to transfer technology, a production process or other proprietary knowledge to a person in its territory; or
(g) to supply exclusively from the territory of the Party a good that such investment produces or a service it provides to a specific regional market or to the world market.
2. A measure that requires an investment to use a technology to meet generally applicable health, safety or environmental requirements is not inconsistent with paragraph 1(f). For greater certainty, Articles 9.04 and 9.05 apply to that measure.
3. A Party may not condition the receipt or continued receipt of an advantage, in connection with an investment in its territory of an investor of a Party or of a non-Party, on compliance with the following requirements:
(a) to achieve a given level or percentage of domestic content;
(b) to purchase, use or accord a preference to a good produced in its territory, or to purchase a good from a producer in its territory;
(c) to relate the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such investment; or
(d) to restrict sales of a good or service in its territory that such investment produces or provides by relating those sales in any way to the volume or value of its exports or foreign exchange earnings.
4. Paragraph 3 does not prevent a Party from conditioning the receipt or continued receipt of an advantage in connection with an investment in its territory of an investor of a Party or of a non-Party, on compliance with a requirement to locate production, provide a service, train or employ workers, construct or expand particular facilities, or carry out research and development, in its territory.
5. Paragraph 1(f) does not apply if the requirement is imposed or the commitment or undertaking is enforced by a court, administrative tribunal or competition authority to remedy an alleged violation of domestic competition law.
6. Paragraphs 1 and 3 do not apply to a requirement other than the requirements set out in those paragraphs.
7. This Article does not preclude enforcement of a commitment, undertaking or requirement between private parties.
8. The provisions of:
(a) paragraphs 1(a), (b) and (c), and 3(a) and (b) do not apply to a qualification requirement for a good or service with respect to export promotion and foreign aid programs;
(b) paragraphs 1(b), (c), (f) and (g), and 3(a) and (b) do not apply to procurement by a Party or a state enterprise; and
(c) paragraphs 3(a) and (b) do not apply to a requirement imposed by an importing Party relating to the content of a good necessary to qualify for a preferential tariff or preferential quota.
Article 9.08. Senior Management and Boards of Directors
1. A Party may not require that an enterprise of that Party that is a covered investment appoint individuals of any particular nationality to senior management positions.
2. A Party may require that a majority of the board of directors, or a committee thereof, of an enterprise that is a covered investment be of a particular nationality or resident in the territory of the Party, provided that the requirement does not materially impair the ability of the investor to exercise control over its investment.
Article 9.09. Reservations and Exceptions
1. Articles 9.04, 9.05, 9.07 and 9.08 do not apply to:
(a) an existing non-conforming measure maintained by:
(i) the national government of a Party as set out in its Schedule to Annex I, or
(ii) a sub-national government of a Party;
(b) the continuation or prompt renewal of a non-conforming measure referred to in subparagraph (a); or
(c) an amendment to a non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure, as it existed immediately before the amendment, with Articles 9.04, 9.05, 9.07 and 9.08.
2. Articles 9.04, 9.05, 9.07 and 9.08 do not apply to a measure that a Party adopts or maintains with respect to sectors, subsectors or activities, as set out in its Schedule to Annex II.
3. Article 9.05 does not apply to treatment accorded by a Party under an agreement, or regarding a sector, set out in its Schedule to Annex II.
4. Regarding intellectual property rights, a Party may derogate from Articles 9.04, 9.05 and Article 9.07(1)(f) in a manner that is consistent with the TRIPS Agreement and waivers to the TRIPS Agreement adopted under Article IX of the WTO Agreement.
5. Articles 9.04, 9.05 and 9.08 do not apply to:
(a) procurement by a Party or a state enterprise; or
(b) a subsidy or grant provided by a Party or a state enterprise, including a government-supported loan, guarantee or insurance.
Article 9.10. Transfers
1. Each Party shall permit transfers relating to a covered investment to be made freely and without delay, into and out of its territory. Those transfers include:
(a) contributions to capital;
(b) profits, dividends, interest, capital gains, royalty payments, management fees, technical assistance and other fees, returns in kind and other amounts derived from the investment;
(c) proceeds from the sale of all or any part of the covered investment or from the partial or complete liquidation of the covered investment;
(d) payments made under a contract entered into by the investor, or the covered investment, including payments made pursuant to a loan agreement;