4. The date of establishment of the arbitral tribunal shall be the date on which its chairman is designated.
Article 3. Terms of Reference of the Arbitral Tribunals
Unless the Parties agree otherwise within twenty (20) days of the date of the request for the establishment of the arbitral tribunal, the terms of reference of the court arbitral will be:
"Examine, objectively and in light of the relevant provisions of Chapter 8 (Cooperation and Facilitation of Investments) of the Free Trade Agreement between Chile and Brazil, the matter indicated in the request for the establishment of an arbitral tribunal, and formulate conclusions of fact and of law, determining in a well-founded manner if the measure in question is or is not in accordance with the Agreement. "
Article 4. Composition of the Arbitral Tribunals and Selection of the Arbitrators
1. The arbitral tribunal shall consist of three arbitrators.
2. Each Party shall designate, within sixty (60) days following the date of the request for the establishment of the arbitral tribunal, an arbitrator who may be of any nationality.
3. The two appointed arbitrators, within a term of sixty (60) days counted from the designation of the last of them, shall designate the national of a third State, with whom both Parties maintain diplomatic relations, and that they may not have their habitual residence in any of the Parties, nor be dependent on any of the Parties, or have participated in any way in the dispute, and who upon approval by both Parties, within thirty (30) days counted from the date of his nomination, he will be appointed president of the arbitral tribunal.
4. If, within the periods indicated in paragraphs 2 and 3, the Necessary designations, any of the Parties may request the Secretary General of the Court Permanent Court of Arbitration of The Hague, make the necessary appointments. If the Secretary General of the Permanent Court of Arbitration of The Hague is a national of one of the Parties or is unable to exercise this function, the member of the Permanent Court of Arbitration of The Hague that has the longest standing and is not a national of one of the Parties, will be invited to do the necessary designations.
5. All arbitrators must:
(a) Have experience or specialized knowledge in International Law Public, International Investment Rules, or in the resolution of controversies that arise in relation to International Investment Agreements;
(b) Be chosen strictly according to their objectivity, reliability and good judgment;
(c) Be independent and not be linked to any of the Parties, or to the others arbitrators or potential witnesses, directly or indirectly, or receive instructions from Parties, and
(d) Comply mutatis mutandis with the Rules of Conduct for the application of the understanding regarding the rules and procedures governing the dispute settlement of the World Trade Organization (WTO / DSB / RC / 1, of December 11, 1996), or with any other standard of conduct established by the Joint Committee.
6. In the event of resignation, incapacity or death of any of the appointed arbitrators of In accordance with this Article, a successor will be appointed within a term of fifteen (15) days according to the provisions of paragraphs 2, 3, 4 and 5, which will be applied respectively mutatis mutandis. The successor will have all the authority and the same obligations as the referee original. The procedure of the arbitral tribunal shall be suspended from the date on which the original arbitrator resigns, becomes incapacitated or dies and resumes on the date on which the successor is designated.
Article 5. Proceedings of the Arbitral Tribunals
1. An arbitral tribunal, established in accordance with this Annex, shall follow the Rules of Procedure that the Parties will establish, unless they themselves agree otherwise. A arbitral tribunal may establish, in consultation with the Parties, rules of procedure supplementary rights that do not conflict with the provisions of this Article and the procedural Rules.
2. The rules of procedure will ensure that:
(a) Parties will have the opportunity to provide at least one written submission and witness any of the presentations, statements or replies during the process. All information or written presentation submitted by a Party before the arbitral tribunal and the answers to the questions of the arbitral tribunal, they will make available to the other Party;
(b) The arbitral tribunal shall consult with the Parties when appropriate and provide the right opportunities to reach a mutually satisfactory solution;
(c) Upon notification to the Parties, and subject to the terms and conditions that the Parties may agree within the ten (10) following days, the arbitral tribunal may look for information from any relevant source and consult experts to collect your opinion or advice on some aspects of the matter. The arbitral tribunal shall provide the Parties with a copy of any opinion or advice obtained, giving the opportunity to comment;
(d) The deliberations of the arbitral tribunal and the documents delivered shall be confidential, provided that the Party that delivered them has qualified them as such;
(e) Without prejudice to the provisions of subparagraph (d), any Party may carry out public statements about their views on the controversy, but will try as confidential the information and the written presentations delivered by the another Party to the arbitral tribunal and that it has qualified as confidential; and
(f) Each Party shall bear the cost of the arbitrators appointed by it, as well as its expenses. The cost of the president of the arbitral tribunal and other expenses associated with the development of the procedure will be assumed by the parties to the dispute in the same proportions.
Article 6. Suspension or Termination of the Procedure
1. The Parties may agree to suspend the arbitration procedure, at any time, for a period not exceeding twelve (12) months counted from the date of communication jointly with the president of the arbitral tribunal, interrupting the calculation of the terms by time that suspension lasts. If the arbitration proceedings were suspended for more than twelve (12) months, the procedure initiated will be considered finished, unless the Parties agree contrary.
2. The Parties may agree on the termination of the arbitration procedure by notification jointly with the president of the arbitral tribunal at any time prior to notification of the award to the Parties.
Article 7. Award
1. The arbitral tribunal shall render its award in writing within a period of six (6) months counted since its establishment, which may be extended for a maximum of thirty (30) days, prior notification to the Parties.
2. The award shall be adopted by majority, shall be substantiated and subscribed by the members of the arbitral tribunal.
3. Without prejudice to other elements that the arbitral tribunal deems pertinent, the award shall necessarily contain a summary of the presentations and arguments of the Parties; and the conclusions of fact and law, determining in a well-founded manner if the measure in question is or not in accordance with this Chapter.
4. The award shall be final, unappealable and binding on the Parties, which shall comply with it without delay.
5. The award shall be made available to the public within fifteen (15) days after the date of its issuance, subject to the requirement to protect confidential information.
Article 8. Clarification and Interpretation of the Award
1. Without prejudice to the provisions of Article 7, either Party may request the arbitral tribunal, within fifteen days (15) following the notification of the award, a clarification or an interpretation of it.
2. The arbitral tribunal shall pronounce itself within fifteen (15) days following said request.
3. If the arbitral tribunal considers that circumstances require it, it may suspend the compliance with the award until it decides on the application submitted.
Article 9. Compliance with the Award
Unless the Parties agree otherwise, the requested Party shall comply with the award immediately, or if this is not practicable, within a reasonable period of time determined by common agreement by the Parties. When the Parties do not reach an agreement regarding the reasonable term, Within ninety (90) days following the date of issuance of the award, the arbitral tribunal will determine that reasonable term.
Annex II. Chile DL 600
1. The obligations and commitments contained in this Chapter do not apply to the Decree Law 600, Statute of Foreign Investment, or the rules that replace it, (hereinafter referred to as called "DL 600"), and Law No. 18,657, which authorizes the creation of an investment fund Foreign Capital, with respect to:
(a) The right of the Foreign Investment Committee or its successor to accept or reject requests to invest through an investment contract under DL 600 and the right to regulate the terms and conditions of foreign investment under the DL 600 and Law No. 18,657. The authorization and execution of an investment contract under the DL 600 by a Brazilian investor or your investment does not create any right from the investor or from his investment to carry out particular activities in Chile.
(b) The right to maintain existing requirements on transfers from Chile from product of the total or partial sale of an investment of an investor of a Part or the total or partial liquidation of the investment, which may occur in a period that does not exceed:
(i) In the case of an investment made in accordance with DL 600, one (1) year from the date of the transfer to Chile; or
(ii) In the case of an investment made in accordance with Law 18,657, five years from the date of the transfer to Chile. Law 18,657 was repealed on May 1, 2014 by Law 20,712. The requirement of the transfer established in this section will only apply to investments made in accordance with Law 18.657 before May 1, 2014 and not to investments made in accordance with Law 20,712; and
(c) The right to adopt measures, compatible with this Annex, establishing in the future voluntary investment special programs, in addition to the general for foreign investment in Chile, except if such measures can be restrict transfers from Chile of the proceeds of the total or partial sale of an investment of an investor of another Party or of the total or partial liquidation of investment, for a period not to exceed five years from the date of the transfer to Chile.
2. For greater certainty, except to the extent that paragraph 1 (b) or (c) constitutes a exception to Article 8.11, the investment that enters through an investment contract under the DL 600, through Law 18.657 or through any special voluntary investment program, shall be subject to the obligations and commitments of this Chapter, insofar as it is investment pursuant to this Chapter.
Annex III. Chile Transfers
1. Chile reserves the right of the Central Bank of Chile to maintain or adopt measures of compliance with its Constitutional Organic Law (Law 18,840) or other legal regulations to ensure for the stability of the currency and the normal functioning of internal and external payments. For These effects are granted as attributions to the Central Bank of Chile, the regulation of amount of money and credit in circulation, the execution of credit operations and international changes. Likewise, it is granted the attributions to dictate norms in matter monetary, credit, financial and international exchange. They are part of these measures, between others, the establishment of requirements that restrict or limit current payments and transfers (movements of capital) from or to Chile, as well as operations that are related to they, for example, establish that the deposits, investments or credits that come or are destined abroad are subject to the obligation to maintain a reserve.
2. When applying the measures under this Annex, Chile, as established in its legislation, may not discriminate between Brazil and any third country with respect to operations of the same nature.
3. For greater certainty, this Annex applies to transfers covered by Article 8.11.
Annex IV. Documentation Filing
Brazil
Notifications and other documents will be delivered to:
Undersecretary-General of Economic Assumptions and Financers,
Ministério das Relações Exteriores
Esplanada dos Ministérios - Bloco H - Annex I - Room 224
70,170-900 Brasilia - DF Brazil
Chile
Notifications and other documents will be delivered to:
General Directorate of International Economic Relations of the Ministry of Foreign Affairs of the Republic of Chile
Teatinos 180
Santiago, Chile
Chapter 9. Investments In Financial Institutions
Article 9.1. Definitions
For the purposes of this Chapter:
Shell bank or screen (Shellbank) means a financial institution that has no presence physics (senior management and administration) in the country where it was established and where it obtained a license to operate; that is not part of a financial conglomerate or business group subject to a effective supervision; or whose information on the control structure, ownership or identification of the beneficial owner of the income attributed to non-residents is not available to the tax authorities;
Company means any entity constituted or organized according to the applicable legislation, whether or not for profit and whether it is privately or governmentally owned, including any company, foundation, sole proprietorship or joint venture;
Company of a Party means a company incorporated or organized according to the legislation of a Party, which carries out substantial business activities in the territory of the same Party. For greater certainty, a company of a Party does not include a branch of a company from a country that is not a Party;
Self-regulated entity means any non-governmental entity, body or association exercised by a regulatory or supervisory authority, own or delegated, over the suppliers of financial services or financial institutions established in the territory of the Party; public entity means a government, a central bank or a monetary authority of a Party; or any financial institution or entity, owned or controlled by a Party;
Financial institution means any financial intermediary, including financial institutions, insurance market, stock exchange or financial derivatives, or another company that is authorized to do business and that is regulated or supervised as a financial institution of conformity with the legal order of the Party in whose territory it is located;
Financial institution of the other Party means a financial institution, including a branch, located in the territory of a Party and controlled by persons of the other Party;
Offshore financial institution means any financial institution, established from conformity with the laws and regulations of a Party, which is owned or controlled by a non-resident and whose activities are mainly related to non-residents of the Party, usually on a scale out of proportion to the size of that Party's economy in the one that is established;
Investment
(a) Means a direct investment in financial institutions, that is, all assets of owned or controlled, directly or indirectly, by an investor of a Party, established or acquired in accordance with the legal system of the other Party, in the territory of that other Party, which allows the exercise of ownership, control or a significant degree of influence on the management of a financial institution in the territory of a Party, including in particular, but not exclusively:
(i) A financial institution;
(ii) Shares, capital or other forms of participation in equity or capital social of a financial institution;
(iii) Bonds, debentures, loans or other debt instruments of a financial institution, regardless of the original date of expiration. With respect to "loans" and "debt instruments" mentioned in this section, a loan granted to an institution financial instrument or a debt instrument issued by a financial institution it is an investment only when it is treated as capital for purposes regulations by the Party in whose territory the financial institution;
(iv) Contractual rights, including turnkey contracts, management and other similar contracts;
(v) Licenses, authorizations, permits and similar rights granted from conformity with the domestic legislation of the Party; (vi) intellectual property rights as defined or referenced in the TRIPS Agreement;
(vii) Property rights, tangible or intangible, movable or immovable, and any other real rights, such as the mortgage, pledge, usufruct and similar rights.
(b) For greater certainty, "investment" does not include:
(i) Public debt operations such as a loan granted to a Party, or a debt instrument issued by a Party or company of the State. In the case of Brazil, a debt instrument or a loan to a State enterprise that does not develop economic activities in market conditions and, in the case of Chile, a debt instrument issued by a State company, or a loan to a company from the State;
(ii) An order or sentence filed in a judicial or administrative action;
(iii) Portfolio investments;
(iv) Pecuniary claims derived exclusively from contracts commercial activities for the sale of goods or the provision of services by an investor in the territory of a Party to a national or a company in the territory of the other Party, or the granting of credit in relation to a business transaction;
Investor means a national, permanent resident, or company of a Party, which has made an investment in financial institutions in the territory of the other Party;
Person means a natural person or a company;
Financial service means any service of a financial nature. Financial services they include all insurance and insurance-related services, and all services banking and other financial services (with the exception of insurance) as well as services incidental or auxiliary to a service of a financial nature.
Financial services include the following activities:
Insurance and insurance-related services
i. Direct insurance (including co-insurer):
a) Life insurance.
b) Insurance other than life insurance.
ii. Reinsurance and retrocession.
iii. Insurance intermediation activities, for example those of brokers and insurance agents.
iv. Auxiliary insurance services, for example those of consultants, actuaries, Risk assessment and compensation of claims.
Banking and other financial services (excluding insurance).
v. Acceptance of deposits and other reimbursable funds from the public.
vi. Loans of all kinds, including personal loans, loans Mortgages, factoring and financing of commercial transactions.
vii. Financial leasing services.
viii. All payment and money transfer services, including cards credit, payment and similar, traveler's checks and bank drafts.
ix. Guarantees and commitments.
x. Commercial exchange on their own or on behalf of clients, whether in a stock exchange, in an over-the-counter market or otherwise, of the following:
a) Money market instruments (including checks, bills and Deposit certificates);
b) Currencies;
c) Derivative products, including, but not limited to, future and options;
d) Instruments of the exchange and monetary markets, for example swaps and installment agreements on interest rates;
e) Transferable securities;
f) Other negotiable instruments and financial assets, including metal.
xi. Participation in issues of all kinds of securities, including the subscription and placement as agents (publicly or privately) and the supply of services related to those emissions.
xii. Brokerage of changes.
xiii. Asset management; for example, cash management or of securities portfolios, management of collective investments in all their forms, administration of pension funds, deposit services and custody, and fiduciary services.
xiv. Payment and compensation services for financial assets, including of securities, derivative products and other negotiable instruments.
xv. Supply and transfer of financial information and data processing financial and related software, by other providers financial services.
xvi. Advisory and intermediation services and other financial services auxiliary to any of the activities listed in the numerals (v) to (xv), including reports and credit analysis, studies and advice on investments and securities portfolios, advice on acquisitions and on corporate restructuring and strategy, and
LCP means Local Currency Payment system.
Article 9.2. Scope of Application
1. This Chapter applies to measures adopted or maintained by a Party relating to:
(a) Financial institutions of the other Party, and
(b) Investors of the other Party and the investments of those investors in financial institutions in the territory of the Party.
2. Chapter 8 (Investment Cooperation and Facilitation) will apply to the measures described in paragraph 1 only when the articles of Chapter 8 (Cooperation and Facilitation of Investments) are incorporated into this Chapter.
3. The following articles of the Constitution are incorporated into this Chapter and are an integral part thereof. Chapter 8 (Investment Cooperation and Facilitation):
(a) Article 8.7 (Expropriation);
(b) Article 8.8 (Treatment in Case of Dispute), only regarding losses in physical infrastructure in the financial institutions covered by this Chapter;
(c) Article 8.11 (Transfers);
(d) Article 8.12 (Taxation);
(e) Article 8.14 (Security Exceptions);
(f) Article 8.15 (Social Responsibility Policies);
(g) Article 8.16 (Measures on Investment and Fight against Corruption and the Illegality);
(h) Article 8.17 (Investment and Measures on Health, Environment, Matters Labor and other Regulatory Objectives);
(i) Article 8.18 (Joint Committee for the Administration of the Agreement) as indicated in Article 9.15;
(j) Article 8.19 (National Focal Points or Ombudsmen) as indicated in the Article 9.16;
(k) Article 8.24 (Direct Consultations and Negotiations for the Prevention of Controversies), with the modifications established in Article 9.17, and
(l) Article 8.25 (Arbitration between the Parties), with the modifications established in the Article 9.18.
4. The articles indicated in paragraph 3 are incorporated into this Chapter and are an integral part of it, mutatis mutandis. No other provision of Chapter 8 (Cooperation and Facilitation) of Investments) will be applied to the measures described in paragraph 1. For greater certainty, in case of incompatibility between the provisions of this Chapter and any other provision of the Chapter 8 (Cooperation and Facilitation of Investments), the provisions of this Chapter shall prevail in the measure of incompatibility.
5. Chapter 8 (Cooperation and Facilitation of Investments) and this Chapter will not be applicable to measures adopted or maintained by a Party relating to:
(a) Activities carried out by a central bank or a monetary authority or by any other public entity pursuing monetary or exchange policies;
(b) Activities or services that are part of public retirement or retirement plans, or of social security systems established by law;
(c) Activities or services performed by a public entity for account or with guarantee or using the financial resources of the Party, including its public entities, or
(d) Subsidies or subsidies granted by the Parties, including loans backed by the government, guarantees and insurance.
6. This Chapter will not apply to public procurement of financial services.
7. For greater certainty, the services provided by this Chapter will not be covered by this Chapter. an offshore financial institution; and by shell or screen banks (Shellbanks).
Article 9.3. National Treatment
1. Subject to its laws and regulations in force at the time the investment is made, Each Party shall accord to investors of the other Party treatment no less favorable than that which grant, in similar circumstances, to its own investors, with respect to the expansion, administration, conduct, operation, and sale or other form of disposition of institutions financial institutions and investments in financial institutions in its territory.
2. Subject to its laws and regulations in force at the time the investment is made, Each Party shall grant to the financial institutions of the other Party and to the investments of the investors of the other Party in financial institutions of the Party, no less favorable treatment that he grants, in similar circumstances, to his own financial institutions and to investments of its own investors in financial institutions with respect to expansion, administration, conduction, operation and sale or another form of disposition of institutions financial and investments.
3. The treatment that a Party must grant in accordance with paragraphs 1 and 2 means, with Regarding measures adopted or maintained by a regional or state government, a treatment does not less favorable than the more favorable treatment accorded, in similar circumstances, by that regional or state government to financial institutions, to institutional investors financial statements and investments of investors in financial institutions of the Party of which they are part.
4. For greater certainty, the treatment granted in "similar circumstances" depends on the all of the circumstances, including that the relevant treatment distinguishes between investors, investments or financial institutions based on legitimate public interest objectives.
5. For greater certainty, this Article shall not be construed as obligating the Parties to compensate for intrinsic competitive disadvantages resulting from the foreign character of the investors and their investments.