2. Articles 9.3, 9.4, 9.5 and 9.6 shall not apply to any measure that a Party adopts or maintains with respect to sectors, sub-sectors or activities, as set out by that Party in its Schedule to Annex II (Trade in Services and Investment Schedules).
Article 9.8. Domestic Regulation (7)
1. Each Party shall ensure that all measures of general application affecting trade in services are administered in a reasonable, objective and impartial manner.
2. Each Party shall ensure that its judicial, arbitral or administrative tribunals or procedures which provide for the prompt review of, and where justified, appropriate remedies for, administrative decisions affecting trade in services are open on a non- discriminatory basis to a service supplier of the other Party. Where such procedures are not independent of the agency entrusted with the administrative decision concerned, the Party shall ensure that the procedures in fact provide for an objective and impartial review.
3. Paragraph 2 shall not be construed to require a Party to institute such tribunals or procedures where this would be inconsistent with its constitutional structure or the nature of its legal system.
4. While recognising the right to regulate and to introduce new regulations on the supply of services in order to meet its policy objectives, each Party shall endeavour to ensure that measures relating to qualification requirements and procedures, technical standards and licensing requirements and procedures that it adopts or maintains are:
(a) based on objective and transparent criteria, such as competence and the ability to supply the service; and
(b) in the case of licensing procedures, are not in themselves a restriction on the supply of the service.
5. In determining whether a Party is in conformity with its obligations under paragraph 4(a), account shall be taken of international standards of relevant international organisations (8) applied by that Party.
6. If a Party requires authorisation for the supply of a service, not otherwise excluded through Article 9.7, it shall ensure that its competent authorities:
(a) where specific time periods exist for applications, allow an applicant a reasonable period for the submission of an application;
(b) upon submission from the applicant, initiate the processing of an application without undue delay;
(c) in the case of an application considered incomplete for processing under domestic laws and regulations, within a reasonable period of time, to the extent practicable:
(i) inform the applicant that the application is incomplete;
(ii) at the request of the applicant provide guidance on why the application is considered incomplete;
(iii) provide the applicant with the opportunity to provide the additional information that is required to complete the application; and
(iv) where none of the above is practicable, and the application is rejected due to incompleteness, ensure that the applicant is informed within a reasonable period of time;
(d) to the extent practicable, establish an indicative timeframe for the processing of an application;
(e) within a reasonable period of time after the submission of an application considered complete under its laws and regulations, inform the applicant of the decision concerning the application;
(f) on request of the applicant, provide, without undue delay, information concerning the status of the application;
(g) if an application is rejected, to the extent practicable, inform the applicant in writing of the reasons for the rejection, either directly or on request, as appropriate. The applicant will have the possibility of resubmitting, at its discretion, a new application;
(h) if appropriate, accept copies of documents that are authenticated in accordance with the Party’s laws and regulations in place of original documents; and
(i) to the extent practicable, ensure that authorisation, once granted, enters into effect without undue delay subject to the applicable terms and conditions.
7. Each Party shall ensure that any authorisation fee charged by any of its competent authorities is reasonable, transparent and does not, in itself, restrict the supply of the relevant service. (9)
8. Each Party shall, where it requires authorisation for supply of a service, promptly publish (10) or otherwise make publicly available the information necessary for a service supplier, or a person seeking to supply a service, to comply with the requirements and procedures for obtaining, maintaining, amending and renewing such authorisation. Such information shall include, inter alia and where applicable:
(a) fees;
(b) contact information of relevant competent authorities;
(c) procedures for appeal or review of decisions concerning applications;
(d) procedures for monitoring or enforcing compliance with the terms and
conditions of licenses;
(e) opportunities for public involvement, such as through hearings or comments;
(f) indicative timeframes for processing of an application;
(g) the requirements and procedures; and
(h) technical standards.
9. If licensing or qualification requirements include the completion of an examination, each Party shall ensure that:
(a) the examination is scheduled at reasonable intervals; and
(b) a reasonable period of time is provided to enable applicants to request to take the examination.
10. Further to paragraph 9, each Party should explore, as appropriate, the possibility of:
(a) using electronic means for conducting such examinations;
(b) conducting such examinations orally; and
(c) providing opportunities for taking such examinations in the territory of the other Party.
11. Each Party shall ensure that physical presence in the territory of the other Party is not required for the submission of an application for a license or qualification.
12. Each Party shall endeavour to accept applications in electronic format under the equivalent conditions of authenticity as paper submissions in accordance with domestic law.
13. Where a Party permits a service supplier of the other Party to provide a professional service, that Party shall ensure that there are procedures in place domestically to assess the competency of professionals of the other Party.
14. Subject to its laws and regulations, a Party shall permit service suppliers of the other Party to use the enterprise names under which they trade in the territory of the other Party and otherwise ensure that the use of enterprise names is not unduly restricted.
15. If the results of the negotiations related to paragraph 4 of Article VI of GATS, or the results of any similar negotiations undertaken in other multilateral fora in which the Parties participate, enter into effect, the Parties shall jointly review these results with a view to bringing them into effect, as appropriate, under this Agreement.
Article 9.9. Recognition
1. For the purposes of the fulfilment, in whole or in part, of a Party’s standards or criteria for the authorisation, licensing or certification of service suppliers, and subject to the requirements of paragraph 4, it may recognise the education or experience obtained, requirements met, or licences or certifications granted, in the territory of the other Party or a non-Party. That recognition, which may be achieved through harmonisation or otherwise, may be based on an agreement or arrangement with the other Party or non- Party concerned, or may be accorded autonomously.
2. If a Party recognises, autonomously or by agreement or arrangement, the education or experience obtained, requirements met, or licenses or certifications granted, in the territory of a non-Party, nothing in Article 9.4 shall be construed to require the Party to accord recognition to the education or experience obtained, requirements met, or licenses or certifications granted, in the territory of the other Party.
3. A Party that is a party to an agreement or arrangement of the type referred to in paragraph 1, whether existing or future, shall afford adequate opportunity to the other Party, on request, to negotiate its accession to that agreement or arrangement, or to negotiate a comparable agreement or arrangement. If a Party accords recognition autonomously, it shall afford adequate opportunity to the other Party to demonstrate that education, experience, licences or certifications obtained or requirements met in that other Partyâs territory should be recognised.
4. A Party shall not accord recognition in a manner that would constitute a means of discrimination between the other Party and non-Parties in the application of its standards or criteria for the authorisation, licensing or certification of service suppliers, or a disguised restriction on trade in services.
5. Where appropriate, recognition should be based on multilaterally agreed criteria. In appropriate cases, the Parties shall work in cooperation with relevant intergovernmental and non-governmental organisations towards the establishment and adoption of common international standards and criteria for recognition and common international standards for the practice of relevant services trades and professions.
6. As set out in Annex 9-A, the Parties shall endeavour to facilitate trade in professional services, including through the establishment of a Professional Services Working Group.
Article 9.10. Denial of Benefits
1. A Party may deny the benefits of this Chapter to a service supplier of the other Party if the service supplier is an enterprise owned or controlled by persons of a non- Party, and the denying Party adopts or maintains measures with respect to the non-Party or a person of the non-Party that prohibit transactions with the enterprise or that would be violated or circumvented ifthe benefits of this Chapter were accorded to the enterprise.
2. A Party may deny the benefits of this Chapter to a service supplier of the other Party if the service supplier is an enterprise owned or controlled by persons of a non- Party or by persons of the denying Party that has no substantial business activities in the territory of the other Party.
Article 9.11. Transparency
1. Each Party shall maintain or establish appropriate mechanisms for responding to inquiries from interested persons (11) regarding its laws and regulations that relate to the subject matter of this Chapter.
2. If a Party does not provide advance notice and opportunity for comment in accordance with Article 19.2 (Publication) of Chapter 19 (Transparency) with respect to its laws and regulations that relate to the subject matter of this Chapter, it shall on request of the other Party, provide in writing the reasons for not doing so.
Article 9.12. Payments and Transfers
1. Each Party shall permit all transfers and payments that relate to the supply of services to be made freely and without delay into and out of its territory.
2. Each Party shall permit transfers and payments that relate to the supply of services to be made in a freely usable currency at the market rate of exchange that prevails at the time of transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may prevent or delay a transfer or payment through the equitable, non-discriminatory and good faith application of its laws and regulations (12) that relate to:
(a) bankruptcy, insolvency or the protection of the rights of creditors;
(b) issuing, trading or dealing in securities, futures, options or derivatives;
(c) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;
(d) criminal or penal offences; or
(e) ensuring compliance with orders or judgments in judicial or administrative proceedings.
Article 9.13. Review
1. The Parties shall review this Chapter and related Annexes and Schedules within three years of the date of entry into force of this Agreement with a view to substantially reducing or eliminating discrimination and enhancing market access between the Parties with regard to trade in services. The review shall include the identification of measures to increase trade in services under this Chapter and related Annexes and Schedules between the Parties. Unless the Parties otherwise agree, the initial review, including actions to incorporate the results into this Agreement, shall be completed within two years of initiating the review.
2. The Parties shall subsequently review this Chapter and related Annexes and Schedules every five years thereafter, with a view to substantially reducing or eliminating all remaining discrimination and enhancing market access between the Parties with regard to trade in services.
3. At each review the Parties shall also consider other trade in services issues of mutual interest.
Article 9.14. Committee on Trade In Services
1. The Parties hereby establish a Committee on Trade in Services (Trade in Services Committee) consisting of representatives of the Parties.
2. The Trade in Services Committee shall meet within two years from the date of entry into force of this Agreement and thereafter as mutually determined by the Parties. Meetings may be conducted in person, or by any other means as mutually determined by the Parties.
3. The Trade in Services Committee's functions shall be to:
(a) review the implementation of this Chapter;
(b) implement Article 9.13;
(c) consider any other matters related to this Chapter identified by either Party;
(d) consider matters related to Chapter 10 (Financial Services), Chapter 11 (Telecommunications), Chapter 12 (Movement of Natural Persons) and Chapter 13 (Electronic Commerce), and direct the activities of the Professional Services Working Group; and
(e) report to the Joint Committee as required.
Chapter 10. FINANCIAL SERVICES
Article 10.1. Definitions
1. For the purposes of this Chapter:
financial institution means any financial intermediary or other enterprise that is authorised to do business and regulated or supervised as a financial institution under the law of the Party in whose territory it is located by entities such as a central bank or a financial services authority;
financial service means any service of a financial nature. Financial services include all insurance and insurance-related services, and all banking and other financial services (excluding insurance), as well as services auxiliary to a service of a financial nature. Financial services include the following activities:
Insurance and insurance-related services
(i) direct insurance (including co-insurance):
(A) life;
(B) non-life;
(ii) reinsurance and retrocession;
(iii) insurance intermediation, such as brokerage and agency; and
(iv) services auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services;
Banking and other financial services (excluding insurance)
(v) acceptance of deposits and other repayable funds from the public;
(vi) lending of all types, including consumer credit, mortgage credit,
factoring and financing of commercial transactions;
(vii) financial leasing;
(viii) all payment and money transmission services, including credit, charge and debit cards, travellers cheques and bankers drafts;
(ix) guarantees and commitments;
(x) trading for own account or for account of customers, whether on an exchange, in an over-the-counter market or otherwise, the following:
(A) money market instruments (including cheques, bills, certificates of deposits);
(B) foreign exchange;
(C) derivative products, including futures and options;
(D) exchange rate and interest rate instruments, including
products such as swaps, forward rate agreements;
(E) transferable securities; and
(F) other negotiable instruments and financial assets, including bullion;
(xi) participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;
(xii) money broking;
(xiii) asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;
(xiv) settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;
(xv) provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services; and
(xvi) advisory, intermediation and other auxiliary financial services on all the activities listed in subparagraphs (e) through (o), including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy;
financial service supplier means a person that seeks to supply or supplies a financial service;
new financial services means a financial service that is not supplied by any financial services supplier in the territory of a Party but which is supplied and regulated in the territory of the other Party. This may include services related to existing and new products or the manner in which the product is delivered;
public entity means a government, a central bank or monetary authority or financial services authority of a Party, or any financial institution that is owned or controlled by a Party; and self-regulatory organisation means any non-governmental body, including any securities or futures exchange or market, clearing or payment settlement agency, other organisation or association that: (i) is recognised as having self-regulatory powers; or
(ii) exercises regulatory or supervisory authority; over financial service suppliers by legislation or delegation from central, regional or local governments or authorities.
2. For the purposes of subparagraph (f) of Article 14.1 (Definitions) of Chapter 14 (Investment), the term investment means, in respect of a financial service:
(a) ‘investment’ as defined in Article 14.1 (Definitions) of Chapter 14 (Investment), except that, with respect to ‘loans’ and ‘debt instruments’ referred to in that Article:
(i) a loan to or debt instrument issued by a financial institution is an investment only if it is treated as regulatory capital by the Party in whose territory the financial institution is located; and
(ii) a loan granted by or debt instrument owned by a financial institution, other than a loan to or debt instrument issued by a financial institution referred to in subparagraph (i), is not an investment;
(b) for greater certainty, a loan granted by or debt instrument owned by a financial service supplier of the other Party, other than a loan to or debt instrument issued by a financial institution, is an investment for the purposes of Chapter 14 (Investment), if such loan or debt instrument meets the criteria for investments set out in Article 14.1 (Definitions) of Chapter 14 (Investment).
3. For the purposes of Article 9.1 (Definitions) of Chapter 9 (Trade in Services), the term “services supplied in the exercise of governmental authority” means, in respect of a financial service:
(a) activities or services forming part of a public retirement plan or statutory system of social security; or
(b) activities or services conducted for the account or with the guarantee or using the financial resources of the Party, including its public entities,
except where a Party allows any of the activities or services referred to in subparagraphs (a) or (b) to be conducted by its financial service suppliers in competition with a public entity or a financial service supplier.
4. The definition of “services supplied in the exercise of governmental authority” in Article 9.1 (Definitions) of Chapter 9 (Trade in Services) shall not apply to the services covered by this Chapter.
Article 10.2. Scope
1. This Chapter provides for commitments additional to Chapter 9 (Trade in Services) and Chapter 14 (Investment) in relation to financial services.
2. This Chapter shall apply to measures adopted or maintained by a Party affecting the trade or supply of a financial service. Reference to trade in financial services or supply of a financial service in this Chapter shall mean ‘trade in services or supply of a service’ as defined in Article 9.1 (Definitions) of Chapter 9 (Trade in Services).
3. Notwithstanding paragraph 1,
(a) sub-paragraphs 6 through 15 of Article 9.8 (Domestic Regulation) of Chapter 9 (Trade in Services) and Article 14.6 (Prohibition of Performance Requirements) of Chapter 14 (Investment) shall not apply to the services covered by this Chapter; and
(b) Section B (Investor-State Dispute Settlement) of Chapter 14 (Investment) shall only apply to the services covered by this Chapter for claims that a Party has breached Articles 14.7 (Minimum Standard of Treatment), 14.8 (Treatment in Case of Armed Conflict or Civil Strife), 14.9 (Transfers), 14.11 (Expropriation and Compensation), 14.15 (Special Formalities and Disclosure of Information) and 14.13 (Denial of Benefits) of Chapter 14 (Investment).
4. In the event of any inconsistency between this Chapter and Chapter 9 (Trade in Services), Chapter 11 (Telecommunications), Chapter 13 (Electronic Commerce), Chapter 14 (Investment) or Chapter 19 (Transparency), this Chapter shall prevail to the extent of the inconsistency.
Article 10.3. New Financial Services (1)
Each Party shall endeavour to permit a financial institution of the other Party established in its territory to supply a new financial service that the Party would permit its own financial institutions, in like circumstances, to supply without adopting a law or regulation, or modifying an existing law or regulation. Notwithstanding Article 9.5 (Market Access) of Chapter 9 (Trade in Services), a Party may determine the institutional and juridical form through which the new financial service may be supplied and may require authorisation for the supply of the service. If a Party requires a financial institution to obtain authorisation to supply a new financial service, the Party shall decide within a reasonable period of time whether to issue the authorisation and may refuse the authorisation for prudential reasons under Article 10.5.
Article 10.4. Treatment of Certain Information and Processing of Information
Neither Party shall take measures that prevent transfers of information or the processing of financial information, including transfers of data by electronic means, or that, subject to importation rules consistent with international agreements, prevent transfers of equipment, where such transfers of information, processing of financial information or transfers of equipment are necessary for the conduct of the ordinary business of a financial service supplier. Nothing in this Article restricts the right of a Party to protect personal data, personal privacy and the confidentiality of individual records and accounts or to require compliance with domestic regulation in relation to data management and storage and system maintenance so long as such right is not used to circumvent the provisions of this Chapter and Chapter 9 (Trade in Services) and Chapter 14 (Investment).
Article 10.5. Exceptions
1. Notwithstanding any other provisions of this Agreement except for Chapter 2 (Trade in Goods), Chapter 4 (Rules of Origin), Chapter 5 (Customs Procedures), Chapter 7 (Sanitary and Phytosanitary Measures) and Chapter 8 (Technical Barriers to Trade), a Party shall not be prevented from adopting or maintaining measures for prudential reasons, (2) (3) including for the protection of investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial service supplier, or to ensure the integrity and stability of the financial system. If these measures do not conform with the provisions of this Agreement to which this exception applies, they shall not be used as a means of avoiding the Party’s commitments or obligations under those provisions.
2. Nothing in this Chapter, Chapter 9 (Trade in Services), Chapter 11 (Telecommunications), Chapter 13 (Electronic Commerce), or Chapter 14 (Investment), shall apply to non-discriminatory measures of general application taken by any public entity in pursuit of monetary and related credit policies or exchange rate policies.
3. Notwithstanding Article 14.9 (Transfers) of Chapter 14 (Investment) and Article 9.12 (Payments and Transfers) of Chapter 9 (Trade in Services), a Party may prevent or limit transfers by a financial service supplier to, or for the benefit of, an affiliate of or person related to such institution or supplier, through the equitable, non-discriminatory and good faith application of measures relating to maintenance of the safety, soundness, integrity, or financial responsibility of financial service suppliers. This paragraph does not prejudice any other provision of this Agreement that permits a Party to restrict transfers.
4. For greater certainty, nothing in this Chapter shall be construed to prevent a Party from adopting or enforcing measures necessary to secure compliance with laws or regulations that are not inconsistent with this Chapter, including those relating to the prevention of deceptive and fraudulent practices or to deal with the effects of a default on financial services contracts, subject always to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between Parties or between Parties and non-Parties where like conditions prevail, or a disguised restriction on investment in financial institutions or trade in financial services as covered by this Chapter.