Japan - Switzerland FTA (2009) - Electronic Database of Investment Treaties (EDIT)

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Japan - Switzerland FTA (2009)

Title

Agreement on Free Trade and Economic Partnership between Japan and the Swiss Confederation

Preamble

Japan and the Swiss Confederation (hereinafter referred to as "Switzerland"), hereinafter referred to as "the Parties",
RECOGNISING that a dynamic and rapidly changing global environment brought about by globalisation and technological progress presents various economic and strategic challenges and opportunities to the Parties;
CONSCIOUS of their longstanding friendship and ties that have developed through many years of fruitful and mutually beneficial cooperation and convinced that this Agreement will open a new era for their relationship;
REAFFIRMING their commitment to democracy, the rule of law, human rights and fundamental freedoms in accordance with their obligations under international law, including those set out in the United Nations Charter, and with the principles of the Universal Declaration of Human Rights;
BELIEVING that their bilateral relationship will be enhanced by forging a mutually beneficial economic partnership through trade liberalisation, trade facilitation and cooperation;
CONVINCED that the economic partnership will provide a useful framework for enhanced cooperation, serve their common interests in various fields as agreed in this Agreement and lead to the improvement of economic efficiency and the development of trade, investment and human resources;
RECOGNISING that such a partnership will create larger and new markets, and enhance the attractiveness and dynamism of their markets;
RECALLING Article XXIV of the General Agreement on Tariffs and Trade 1994 and Article V of the General Agreement on Trade in Services in Annex 1A and Annex 1B, respectively, to the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994; RECOGNISING the importance of ensuring security in international trade without creating unnecessary obstacles to trade and of further deepening cooperation between the Parties in that field;
DETERMINED, in implementing this Agreement, to seek to preserve and protect the environment, to promote the optimal use of natural resources in accordance with the objective of sustainable development and to adequately address the challenges of climate change; BELIEVING that this Agreement lays the foundation for further invigoration of cooperation between them in various economic fields; and DETERMINED to establish a legal framework for an economic partnership between them; HAVE AGREED as follows:

Body

Section CHAPTER 1. General Provisions

Article 1. Objectives

The objectives of this Agreement are to:
(a) liberalise and facilitate trade in goods and services between the Parties;
(b) increase investment opportunities and strengthen protection for investments and investment activities in the Parties;
(c) promote cooperation and coordination for the effective enforcement of competition laws and regulations in each Party;
(d) ensure protection of intellectual property and promote cooperation in this field;
(e) enhance opportunities for suppliers of the Parties to participate in government procurement in the Parties; and
(f) create effective procedures for the implementation of this Agreement and for the resolution of disputes.

Article 2. Scope of Application

Unless otherwise provided for in this Agreement, wherever applicable, this Agreement shall apply to the territories of the Parties.

Article 3. General Definitions

For the purposes of this Agreement:
(a) "Area" of a Party means:
(i) with respect to Japan, the territory of Japan, and all the area beyond its territorial sea, including the sea-bed and subsoil thereof, over which Japan exercises sovereign rights or jurisdiction in accordance with international law and the laws and regulations of Japan; and (ii) with respect to Switzerland, the territory of Switzerland;
(b) "customs territory" of a Party means the territory with respect to which the customs laws of the Party are in force. The customs territory of Switzerland includes the territory of the Principality of Liechtenstein, as long as the Customs Union Treaty of 29 March 1923 between the Swiss Confederation and the Principality of Liechtenstein remains in force;
(c) "GATS" means the General Agreement on Trade in Services in Annex 1B to the WTO Agreement;
(d) "GATT 1994" means the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement. For the purposes of this Agreement, references to articles in the GATT 1994 include the interpretative notes;
(e) "Harmonized System" or "HS" means the Harmonized Commodity Description and Coding System set out in the Annex to the International Convention on the Harmonized Commodity Description and Coding System, and adopted and implemented by the Parties in their respective laws;
(f) "TRIPS Agreement" means the Agreement on Trade- Related Aspects of Intellectual Property Rights in Annex 1C to the WTO Agreement; and
(g) "WTO Agreement" means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994.

Article 4. Transparency

1. Each Party shall promptly publish, or otherwise make publicly available, its laws, regulations, administrative procedures, judicial decisions and administrative rulings of general application as well as international agreements to which the Party is a party, which pertain to or affect the operation of this Agreement.
2. Each Party shall make its best efforts to ensure that the public obtains, upon request, the names and addresses of the competent authorities responsible for laws, regulations, administrative procedures and administrative rulings, referred to in paragraph 1.
3. Each Party shall, upon request by the other Party, within a reasonable period of time, respond to specific questions from, and provide information to, the other Party with respect to matters referred to in paragraph 1.
4. When introducing or changing its laws, regulations, or administrative procedures that significantly affect the operation of this Agreement, each Party shall endeavour to provide, except in emergency situations, a reasonable interval between the time when such laws, regulations, or administrative procedures are published or made publicly available and the time when they enter into force.

Article 5. Confidential Information

1. Unless otherwise provided for in this Agreement, nothing in this Agreement shall require a Party to provide confidential information, the disclosure of which would impede the enforcement of its laws and regulations or otherwise be contrary to the public interest, or which would prejudice the legitimate commercial interests of particular enterprises, public or private.
2. Each Party shall, in accordance with its laws and regulations, maintain the confidentiality of information provided in confidence by the other Party pursuant to this Agreement.
3. Notwithstanding paragraph 2, the information provided pursuant to this Agreement may be transmitted to a third party, subject to prior consent of the Party which provided the information.

Article 6. Taxation

1. The following provisions in this Agreement are relevant to taxation measures: (a) Article 14, and such other provisions as are necessary to give effect to that Article to the same extent as Article III of the GATT 1994; (b) Chapter 6; (c) Chapter 9, as provided for in Article 100; (d) Chapter 11; and (e) Chapter 12.
2. Without prejudice to Chapters 6, 9 and 11, nothing in this Agreement shall affect the rights and obligations of either Party under any agreement on the avoidance of double taxation. In the event of any inconsistency between this Agreement and any such agreement, that agreement shall prevail to the extent of the inconsistency.
3. If a Party considers that a taxation measure applied by the other Party adversely affects the implementation or the functioning of provisions of this Agreement other than those referred to in paragraph 1, the Parties shall, upon request of the former Party, hold consultations with a view to finding a mutually satisfactory solution without having recourse to the dispute settlement procedures provided for in Chapter 14.

Article 7. Relation to other Agreements

1. The Parties reaffirm their rights and obligations under the WTO Agreement or any other agreements to which both Parties are parties.
2. In the event of any inconsistency arising between this Agreement and the WTO Agreement or any other agreements to which both Parties are parties, the Parties shall immediately consult with each other with a view to finding a mutually satisfactory solution, taking into consideration general principles of international law.

Article 8. Preferential Agreements

1. This Agreement shall not prevent the maintenance or establishment of customs unions, free trade areas, arrangements for frontier trade and other preferential agreements, to the extent that they do not adversely affect the rights and obligations provided for by this Agreement.
2. In case a Party establishes a customs union with a non- Party, it shall inform the other Party. Upon request of the other Party, the Parties shall enter into consultations with a view to examining the possible impact of the customs union on the implementation of this Agreement.

Article 9. Promotion of Trade In Environmental Products and Environment-related Services

1. The Parties shall encourage trade and dissemination of environmental products and environment-related services in order to facilitate access to technologies and products that support the environmental protection and development goals, such as improved sanitation, pollution prevention, sustainable promotion of renewable energy and climate-change-related goals.
2. The Parties shall periodically review in the Joint Committee progress achieved in pursuing the objectives set out in paragraph 1.

Article 10. Implementing Agreement

The Governments of the Parties shall conclude a separate agreement (hereinafter referred to as "the Implementing Agreement"), which sets forth details and procedures for the implementation of certain provisions of this Agreement.

Section CHAPTER 2. Trade In Goods

Article 11. Definitions

For the purposes of this Chapter:
(a) "bilateral safeguard measure" means a bilateral safeguard measure provided for in paragraph 2 of Article 20;
(b) "customs duty on exports" means any duty and a charge of any kind, including any form of surtax or surcharge, imposed in connection with the exportation of a product, but does not include any fee or other charge commensurate with the cost of services rendered, imposed consistently with the provisions of Article VIII of the GATT 1994;
(c) "customs duty on imports" means any duty and a charge of any kind, including any form of surtax or surcharge, imposed in connection with the importation of a product, but does not include any:
(i) charge equivalent to an internal tax imposed consistently with the provisions of paragraph 2 of Article III of the GATT 1994, in respect of like products or directly competitive or substitutable products of the customs territory of a Party, or in respect of products from which the imported products have been manufactured or produced in whole or in part;
(ii) anti-dumping or countervailing duty applied pursuant to the laws and regulations of a Party and applied consistently with the provisions of Article VI of the GATT 1994, the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement and the Agreement on Subsidies and Countervailing Measures in Annex 1A to the WTO Agreement; or
(iii) fee or other charge commensurate with the cost of services rendered, imposed consistently with the provisions of Article VIII of the GATT 1994;
(d) "customs value of products" means the value of products for the purposes of levying ad valorem customs duties on imports;
(e) "domestic industry" means the producers as a whole of the like or directly competitive products operating in the customs territory of a Party, or those whose collective output of the like or directly competitive products constitutes a major proportion of the total domestic production of those products;
(f) "export subsidies" means export subsidies listed in subparagraphs 1(a) to 1(f) of Article 9 of the Agreement on Agriculture in Annex 1A to the WTO Agreement (hereinafter referred to as "the Agreement on Agriculture");
(g) "originating product" means a product which qualifies as an originating product under Annex II;
(h) "serious injury" means a significant overall impairment in the position of a domestic industry; and
(i) "threat of serious injury" means serious injury that, on the basis of facts and not merely on allegation, conjecture or remote possibility, is clearly imminent.

Article 12. Scope

This Chapter shall apply, as specified therein, to any product traded between the customs territories of the Parties, falling within any chapter of the Harmonized System.

Article 13. Classification of Products

The classification of products traded between the customs territories of the Parties shall be in conformity with the Harmonized System.

Article 14. National Treatment

Each Party shall accord national treatment to the products of the customs territory of the other Party in accordance with Article III of the GATT 1994, which is hereby incorporated into and made part of this Agreement, mutatis mutandis.

Article 15. Customs Duty on Imports

1. Except as otherwise provided for in this Agreement, each Party shall eliminate or reduce its customs duties on imports on originating products of the Party and the other Party, imported from the customs territory of the other Party, in accordance with the terms and conditions set out in its Schedule in Annex I.
2. In cases where its most-favoured-nation applied rate of customs duty on imports on a particular product is lower than the rate of customs duty on imports to be applied in accordance with paragraph 1 on an originating product which is classified under the same tariff line as that particular product, each Party shall apply the lower rate with respect to that originating product.
3. Except as otherwise provided for in this Agreement, neither Party shall increase any customs duty on imports on originating products of the Party and the other Party, imported from the customs territory of the other Party, above the rate to be applied in accordance with the terms and conditions set out in its Schedule in Annex I.

Article 16. Customs Duty on Exports

Neither Party shall introduce or maintain any customs duty on exports on products exported from the customs territory of the Party into the customs territory of the other Party.

Article 17. Customs Valuation

For the purposes of determining the customs value of products traded between the customs territories of the Parties, the provisions of Part I of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement (hereinafter referred to as "the Agreement on Customs Valuation"), which is hereby incorporated into and made part of this Agreement, mutatis mutandis, shall apply.

Article 18. Import and Export Restrictions

Each Party shall ensure that no prohibition or restriction other than customs duties on imports and customs duties on exports inconsistent with its obligations under Article XI of the GATT 1994 and other relevant provisions under the WTO Agreement are introduced or maintained in the customs territory of the Party on the importation of any product of the customs territory of the other Party or on the exportation or sale for export of any product destined for the customs territory of the other Party.

Article 19. Export Subsidies

Unless otherwise provided for in Annex I, no export subsidies shall be introduced or maintained in the customs territory of a Party on any agricultural product which is listed in Annex 1 to the Agreement on Agriculture.

Article 20. Bilateral Safeguard Measures

1. Subject to the provisions of this Article, a Party may apply a bilateral safeguard measure, to the minimum extent necessary to prevent or remedy serious injury to its domestic industry and to facilitate adjustment thereof, if an originating product of the other Party, as a result of the elimination or reduction of a customs duty on imports in accordance with Article 15, is being imported into the customs territory of the former Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions that the imports of that originating product constitute a substantial cause of serious injury, or threat of serious injury, to the domestic industry in the customs territory of the former Party.
2. A Party may, unless otherwise provided for in Annex I, as a bilateral safeguard measure:
(a) suspend the further reduction of the rate of customs duty on imports on the originating product of the other Party referred to in paragraph 1; or
(b) increase the rate of customs duty on imports on the originating product of the other Party referred to in paragraph 1 to a level not to exceed the lesser of:
(i) the most-favoured-nation applied rate of customs duty on imports in effect on the day when the bilateral safeguard measure is taken; and
(ii) the most-favoured-nation applied rate of customs duty on imports in effect on the day immediately preceding the date of entry into force of this Agreement.
3. A Party shall not apply a bilateral safeguard measure to originating products imported up to the limit of quota quantities granted under tariff rate quotas applied in accordance with the terms and conditions set out in its Schedule in Annex I.
4. A Party may apply a bilateral safeguard measure only after an investigation has been carried out by its competent authorities in accordance with the same procedures as provided for in Article 3 and paragraph 2 of Article 4 of the Agreement on Safeguards in Annex 1A to the WTO Agreement (hereinafter referred to as "the Agreement on Safeguards"). Such investigation shall in all cases be completed within one year following its date of initiation.
5. The following conditions and limitations shall apply with regard to a bilateral safeguard measure:
(a) A Party shall immediately make a written notice to the other Party upon:
(i) initiating an investigation referred to in paragraph 4 relating to serious injury, or threat of serious injury, and the reasons for it; and
(ii) taking a decision to apply or extend a bilateral safeguard measure.
(b) The Party making the written notice referred to in subparagraph (a) shall provide the other Party with all pertinent information in that notice, including:
(i) in respect of subparagraph (a)(i), in addition to the reason for the initiation of the investigation, a precise description of the originating product subject to the investigation and its subheading under the Harmonized System, the period to be covered by the investigation and the date of initiation of the investigation; and
(ii) in respect of subparagraph (a)(ii), evidence of serious injury or threat of serious injury caused by the increased imports of the originating product, a precise description of the originating product subject to the proposed bilateral safeguard measure and its subheading under the Harmonized System, a precise description of the proposed bilateral safeguard measure, and the proposed date of introduction and expected duration of the bilateral safeguard measure.
(c) A Party proposing to apply or extend a bilateral safeguard measure shall provide adequate opportunity for prior consultations with the other Party with a view to reviewing the information gained from the investigation referred to in paragraph 4, exchanging views on the bilateral safeguard measure and reaching an agreement on compensation provided for in paragraph 6. (d) No bilateral safeguard measure shall be maintained except to the extent and for such period of time as may be necessary to prevent or remedy serious injury and to facilitate adjustment, provided that such period of time does not exceed two years. However, in highly exceptional circumstances, a bilateral safeguard measure may be extended, provided that the total duration of the bilateral safeguard measure, including such extensions, does not exceed three years. In order to facilitate adjustment in a situation where the expected duration of a bilateral safeguard measure exceeds one year, the Party maintaining the bilateral safeguard measure shall progressively liberalise it at regular intervals during the period of application.
(e) No bilateral safeguard measure shall be applied again to the import of a particular originating product which has been subject to such a bilateral safeguard measure, for a period of time equal to the duration of the previous bilateral safeguard measure or one year, whichever is longer.
(f) Upon termination of a bilateral safeguard measure, the rate of customs duty on imports on the originating product concerned shall be the rate which would have been in effect but for the bilateral safeguard measure.
6. (a) A Party proposing to apply or extend a bilateral safeguard measure shall provide to the other Party mutually agreed adequate means of trade compensation in the form of concessions of customs duties on imports whose value is substantially equivalent to that of the additional customs duties on imports expected to result from the bilateral safeguard measure.
(b) If the Parties are unable to agree on compensation within 30 days after the commencement of consultations pursuant to subparagraph 5(c), the Party to whose originating product the bilateral safeguard measure is applied shall be free to suspend the application of concessions of customs duties on imports under this Chapter which are substantially equivalent to the bilateral safeguard measure. The Party exercising the right of suspension may suspend the application of concessions of customs duties on imports only for the minimum period necessary to achieve the substantially equivalent effects and only while the bilateral safeguard measure is maintained.
7. Each Party shall ensure the consistent, impartial and reasonable administration of its laws and regulations relating to bilateral safeguard measures.
8. In applying a bilateral safeguard measure, each Party shall follow equitable, timely, transparent and effective procedures.
9. (a) In critical circumstances, where delay would cause damage which it would be difficult to repair, a Party may apply a provisional bilateral safeguard measure, unless otherwise provided for in Annex I, which shall take the form of a measure set out in subparagraph 2(a) or 2(b), pursuant to a preliminary determination that there is clear evidence that increased imports of an originating product of the other Party have caused serious injury or threat of serious injury to a domestic industry in the customs territory of the former Party.
(b) A Party shall make a written notice to the other Party prior to applying a provisional bilateral safeguard measure referred to in subparagraph (a). Consultations between the Parties on the application of the provisional bilateral safeguard measure shall be initiated immediately after it is applied.
(c) The duration of the provisional bilateral safeguard measure referred to in subparagraph (a) shall not exceed 200 days. During that period, the pertinent requirements of paragraph 4 shall be met. The duration of the provisional bilateral safeguard measure shall be counted as a part of the period referred to in subparagraph 5(d).
(d) Subparagraph 5(f) and paragraphs 7 and 8 shall apply, mutatis mutandis, to the provisional bilateral safeguard measure referred to in subparagraph (a). The customs duty on imports imposed as a result of the provisional bilateral safeguard measure shall be refunded if the subsequent investigation referred to in paragraph 4 does not determine that increased imports of an originating product of the other Party have caused serious injury or threat of serious injury to a domestic industry.
10. A written notice referred to in subparagraphs 5(a) and 9(b) and any other communication between the Parties pursuant to this Article shall be made in the English language.
11. The Parties shall review the provisions of this Article, if necessary, ten years after the date of entry into force of this Agreement or thereafter.
12. Nothing in this Chapter shall prevent a Party from applying safeguard measures to an originating product of the other Party in accordance with:
(a) Article XIX of the GATT 1994 and the Agreement on Safeguards; or
(b) Article 5 of the Agreement on Agriculture.

Article 21. Restrictions to Safeguard the Balance of Payments

1. Nothing in this Chapter shall be so construed as to prevent a Party from taking any measure for balance-ofpayments purposes. A Party taking such measure shall do so in accordance with the conditions and procedures established under Article XII of the GATT 1994 and the Understanding on the Balance-of-Payments Provisions of the General Agreement on Tariffs and Trade 1994 in Annex 1A to the WTO Agreement.
2. Nothing in this Chapter shall preclude the use by a Party of exchange controls or exchange restrictions in accordance with the Articles of Agreement of the International Monetary Fund.

Article 22. General and Security Exceptions

For the purposes of this Chapter, Articles XX and XXI of the GATT 1994, which are hereby incorporated into and made part of this Agreement, mutatis mutandis, shall apply.

Article 23. Rules of Origin

The provisions on Rules of Origin are set out in Annex II.

Article 24. Operational Procedures for Trade In Goods

Upon entry into force of this Agreement, the Joint Committee shall adopt Operational Procedures for Trade in Goods that provide detailed regulations pursuant to which the relevant authorities of the Parties shall implement their functions under this Chapter.

Article 25. General Review

The Parties shall undertake a general review of the provisions of this Chapter and the Schedules of the Parties in Annex I in the fifth calendar year following the calendar year in which this Agreement enters into force. As a result of such a review, the Parties may, if they agree, enter into negotiations on possible improvement of market access under this Chapter and the Schedules of the Parties.

Section CHAPTER 3. Customs Procedures and Trade Facilitation

Article 26. Scope

1. This Chapter shall apply to customs procedures required for the clearance of products traded between the customs territories of the Parties.
2. This Chapter shall be implemented by the Parties in accordance with their respective laws and regulations and within the available resources of their respective customs authorities.

Article 27. Definitions

For the purposes of this Chapter:
(a) "A.T.A. Convention" means the Customs Convention on the A.T.A. Carnet for the Temporary Admission of Goods, done at Brussels on 6 December 1961;
(b) "customs authority" means the customs authority as defined in paragraph (c) of Article I of Annex II; and
(c) "customs laws" means the laws and regulations administered and enforced by the customs authority of each Party concerning the importation, exportation and transit of products, relating to customs duties, charges and other taxes, or to prohibitions, restrictions and other similar controls, falling under the competence of the customs authority of the Party.

Article 28. Transparency

1. Each Party shall ensure that all relevant information of general application pertaining to its customs laws is readily available to any interested person.
2. When information that has been made available must be revised due to changes in its customs laws, each Party shall make the revised information readily available sufficiently in advance of the entry into force of the changes to enable interested persons to take account of them, unless such an advance notice is precluded.
3. At the request of any interested person of the Parties, each Party shall provide, as quickly and as accurately as possible, information relating to the specific customs matters raised by the interested person and pertaining to its customs laws. Each Party shall supply not only the information specifically requested but also any other pertinent information which it considers the interested person should be made aware of.

Article 29. Customs Clearance

1. The Parties shall apply their respective customs procedures in a predictable, consistent and transparent manner.
2. For prompt customs clearance of products traded between the customs territories of the Parties, each Party shall:
(a) make use of information and communications technology;
(b) simplify its customs procedures;
(c) harmonise its customs procedures, to the extent possible, with relevant international standards and recommended practices such as those adopted under the auspices of the Customs Co-operation Council; and
(d) promote cooperation, wherever appropriate, between its customs authority and:
(i) other national authorities of the Party;
(ii) the trading communities of the Party; and
(iii) the customs authorities of non-Parties.
3. Each Party shall provide affected parties with easily accessible means of administrative and judicial review of its administrative actions relating to customs matters.

Article 30. Temporary Admission and Products In Transit

1. Each Party shall continue to facilitate the procedures for the temporary admission of products traded between the customs territories of the Parties in accordance with the A.T.A. Convention.
2. Each Party shall continue to facilitate customs clearance of products in transit from or to the customs territory of the other Party in accordance with paragraph 3 of Article V of the GATT 1994.
3. The Parties shall endeavour to promote, through seminars and courses, the use of A.T.A. carnets pursuant to the A.T.A. Convention for the temporary admission of products and the facilitation of customs clearance of products in transit in the customs territories of the Parties or non-Parties.
4. For the purposes of this Article, "temporary admission" means customs procedures under which certain products may be brought into a customs territory conditionally, relieved totally or partially from the payment of customs duties. Such products shall be imported for a specific purpose, and shall be intended for re-exportation within a specified period and without having undergone any change except normal depreciation due to the use made of them.

Article 31. Cooperation and Exchange of Information

1. The Parties shall cooperate and exchange information in the field of customs procedures, including the enforcement against the trafficking of prohibited products and the importation and exportation of products suspected of infringing intellectual property rights.
2. Paragraph 1 of Article 5 shall not apply to the exchange of information under this Article.
3. Chapter 2 of the Implementing Agreement provides for the details and procedures for the implementation of cooperation and exchange of information, including exchange of confidential information, under this Article.

Article 32. Sub-committee on Rules of Origin, Customs Procedures and Trade Facilitation

For the purposes of the effective implementation and operation of this Chapter, the Sub-Committee on Rules of Origin, Customs Procedures and Trade Facilitation established under Article XXX of Annex II shall perform the functions provided for in the said Article.

Section CHAPTER 4. Sanitary and Phytosanitary Measures

Article 33. Scope

This Chapter shall apply to all sanitary and phytosanitary (hereinafter referred to as "SPS") measures of the Parties under the Agreement on the Application of Sanitary and Phytosanitary Measures in Annex 1A to the WTO Agreement (hereinafter referred to as "the SPS Agreement"), that may, directly or indirectly, affect trade in goods between the Parties.

Article 34. Rights and Obligations

With regard to the rights and obligations of the Parties in respect of SPS measures, the SPS Agreement shall apply.

Article 35. Consultations on Sps Matters

1. The Parties shall hold science-based consultations to identify and address specific issues that may arise from the application of SPS measures with the objective of finding mutually acceptable solutions, at such time and venue as may be agreed by the Parties.
2. The consultations referred to in paragraph 1 shall be held between officials of the Governments of the Parties with the necessary expertise relevant to the issues to be discussed.

Article 36. Non-application of Chapter 14

Chapter 14 shall not apply to this Chapter.

Section CHAPTER 5. Technical Regulations, Standards and Conformity Assessment Procedures

Article 37. Scope

1. This Chapter shall apply to technical regulations, standards and conformity assessment procedures as defined in the Agreement on Technical Barriers to Trade in Annex 1A to the WTO Agreement (hereinafter referred to as "the TBT Agreement").
2. This Chapter shall apply to technical regulations, standards and conformity assessment procedures with respect to any product irrespective of its origin.
3. This Chapter shall not apply to purchasing specifications prepared by governmental bodies for production or consumption requirements of governmental bodies and sanitary and phytosanitary measures as defined in the SPS Agreement.
4. With regard to the rights and obligations of the Parties in respect of technical regulations, standards and conformity assessment procedures, the TBT Agreement shall apply, unless otherwise provided for in this Chapter.

Article 38. Cooperation

1. In order to ensure that technical regulations, standards and conformity assessment procedures do not create unnecessary obstacles to trade in goods between the Parties, the Parties shall, where possible, strengthen their cooperation in the field of technical regulations, standards and conformity assessment procedures. When appropriate, this shall result in sector-specific arrangements.
2. Cooperation pursuant to paragraph 1 may include the following:
(a) exchanging information on technical regulations, standards and conformity assessment procedures of the Parties, including information regarding the harmonisation of the regulations of the Parties with international standards;
(b) jointly contributing, where appropriate, to activities related to technical regulations, standards and conformity assessment procedures in international and regional fora; and
(c) reinforcing the role of international standards as a basis for technical regulations and conformity assessment procedures; and, in particular, promoting the accreditation of conformity assessment bodies and the acceptance of the results of conformity assessment procedures, on the basis of the relevant international standards.

Article 39. Enquiry Point

Each Party shall designate an enquiry point to answer all reasonable enquiries from the other Party regarding technical regulations, standards and conformity assessment procedures and, if appropriate, provide the other Party with other relevant information which it considers the other Party should be made aware of.

Article 40. Acceptance of Results of Conformity Assessment Procedures

1. Each Party shall ensure that, in cases where a positive assurance of conformity with technical regulations is required for a particular product, suppliers of such product imported from the other Party shall be granted access on a nondiscriminatory basis.
2. Each Party shall ensure, whenever possible, that results of the conformity assessment procedures in the other Party are accepted, even when those procedures differ from its own, provided it is satisfied that the procedures offer an assurance of conformity with applicable technical regulations or standards equivalent to its own procedures. In this regard, accreditation of conformity assessment bodies in accordance with relevant standards or guides issued by the international standardising bodies shall establish a rebuttable presumption of adequate technical competence.
3. The Parties recognise that prior consultations may be necessary in order to arrive at a mutually satisfactory understanding with regard to such matters as provided for in paragraphs 1.1 and 1.2 of Article 6 of the TBT Agreement. Such consultations shall take place in the Sub-Committee on Technical Regulations, Standards and Conformity Assessment Procedures provided for in Article 41.
4. A Party shall, upon request of the other Party and where appropriate, explain the reasons why it has not accepted the results of conformity assessment procedures in the other Party.

Article 41. Sub-committee on Technical Regulations, Standards and Conformity Assessment Procedures

1. For the purposes of the effective implementation and operation of this Chapter, the Sub-Committee on Technical Regulations, Standards and Conformity Assessment Procedures (hereinafter referred to in this Article as "the Sub- Committee") is hereby established.
2. The functions of the Sub-Committee shall be:
(a) coordinating and facilitating cooperation pursuant to this Chapter;
(b) reviewing the implementation and operation of this Chapter;
(c) discussing any issues related to this Chapter with the objective of finding mutually acceptable solutions;
(d) undertaking consultations on issues related to technical regulations, standards and conformity assessment procedures;
(e) reporting its findings to the Joint Committee; and
(f) carrying out other tasks assigned to it by the Joint Committee.
3. The Sub-Committee shall be composed of representatives of the Governments of the Parties, and may invite representatives of relevant entities other than the Governments of the Parties. All such representatives shall have the necessary expertise relevant to the issues to be discussed. The Sub-Committee may establish ad hoc working groups to accomplish specific tasks.
4. The Sub-Committee shall meet at such time and venue as may be agreed by the Parties.

Article 42. Non-application of Chapter 14

Chapter 14 shall not apply to this Chapter.

Section CHAPTER 6. Trade In Services

Article 43. Scope and Coverage

1. This Chapter shall apply to measures by a Party affecting trade in services taken by central, regional or local governments and authorities as well as by non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities. It shall apply to all services sectors.
2. In respect of air transport services, this Chapter shall not apply to measures affecting traffic rights, however granted, or measures affecting services directly related to the exercise of traffic rights, other than those affecting:
(a) aircraft repair and maintenance services;
(b) the selling and marketing of air transport services; or
(c) computer reservation system (CRS) services.
3. Articles 45 to 47 shall not apply to laws, regulations or requirements governing the procurement by governmental agencies of services purchased for governmental purposes and not for commercial resale or for use in the supply of services for commercial sale.

Article 44. Definitions

For the purposes of this Chapter:
(a) "aircraft repair and maintenance services" means such activities when undertaken on an aircraft or a part thereof while it is withdrawn from service and does not include so-called line maintenance;
(b) "commercial presence" means any type of business or professional establishment, including through:
(i) the constitution, acquisition or maintenance of a juridical person; or
(ii) the creation or maintenance of a branch or a representative office; within the Area of a Party for the purposes of supplying a service;
(c) "computer reservation system (CRS) services" means services provided by computerised systems that contain information about air carriers' schedules, availability, fares and fare rules, through which reservations can be made or tickets may be issued;
(d) "direct taxes" comprises all taxes on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation;
(e) "juridical person" means any legal entity duly constituted or otherwise organised under applicable law, whether for profit or otherwise, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, joint venture, sole proprietorship or association;
(f) a juridical person is:
(i) "owned" by persons of a Party if more than 50 per cent of the equity interest in it is beneficially owned by persons of that Party;
(ii) "controlled" by persons of a Party if such persons have the power to name a majority of its directors or otherwise to legally direct its actions;
(iii) "affiliated" with another person when it controls, or is controlled by, that other person; or when it and the other person are both controlled by the same person;
(g) "juridical person of a Party" means a juridical person which is either:
(i) constituted or otherwise organised under the law of that Party, and is engaged in substantive business operations in the Area of:
(A) either Party; or
(B) any Member of the World Trade Organization and is owned or controlled by natural persons of that Party or by juridical persons that meet all the conditions of subparagraph (A); or
(ii) in the case of the supply of a service through commercial presence, owned or controlled by:
(A) natural persons of that Party; or
(B) juridical persons of that Party identified under subparagraph (i);
(h) "measure" means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action or any other form;
(i) "measures by a Party affecting trade in services" includes measures in respect of:
(i) the purchase, payment or use of a service;
(ii) the access to and use of, in connection with the supply of a service, services which are required by that Party to be offered to the public generally;
(iii) the presence, including commercial presence, of persons of the other Party for the supply of a service in the Area of the Party;
(j) "monopoly supplier of a service" means any person, public or private, which in the relevant market of the Area of a Party is authorised or established formally or in effect by that Party as the sole supplier of that service; (k) "natural person of a Party" means a natural person who, under the legislation of that Party, is:
(i) in respect of Japan, a national of Japan; or
(ii) in respect of Switzerland:
(A) a national of Switzerland; or
(B) a permanent resident who resides in Switzerland;
(l) "person" means either a natural person or a juridical person;
(m) "selling and marketing of air transport services" means opportunities for the air carrier concerned to sell and market freely its air transport services including all aspects of marketing such as market research, advertising and distribution. These activities do not include the pricing of air transport services nor the applicable conditions;
(n) "services" includes any service in any sector except services supplied in the exercise of governmental authority;
(o) "service consumer" means any person that receives or uses a service;
(p) "service of the other Party" means a service which is supplied:
(i) from or in the Area of the other Party, or in the case of maritime transport, by a vessel registered under the laws of the other Party, or by a person of the other Party which supplies the service through the operation of a vessel and/or its use in whole or in part; or
(ii) in the case of the supply of a service through commercial presence or through the presence of natural persons, by a service supplier of the other Party;
(q) "a service supplied in the exercise of governmental authority" means any service which is supplied neither on a commercial basis nor in competition with one or more service suppliers;
(r) "service supplier" means any person that supplies, or seeks to supply, a service; Note: Where the service is not supplied or sought to be supplied directly by a juridical person but through other forms of commercial presence such as a branch or a representative office, the service supplier (i.e. the juridical person) shall, nonetheless, through such commercial presence be accorded the treatment provided for service suppliers under this Chapter. Such treatment shall be extended to the commercial presence through which the service is supplied or sought to be supplied and need not be extended to any other parts of the service supplier located outside the Area of a Party where the service is supplied or sought to be supplied.
(s) "supply of a service" includes the production, distribution, marketing, sale and delivery of a service;
(t) "trade in services" means the supply of a service:
(i) from the Area of a Party into the Area of the other Party ("cross-border supply mode");
(ii) in the Area of a Party to the service consumer of the other Party ("consumption abroad mode");
(iii) by a service supplier of a Party, through commercial presence in the Area of the other Party ("commercial presence mode");
(iv) by a service supplier of a Party, through presence, in the Area of the other Party, of natural persons of a Party ("presence of natural persons mode"); and
(u) "traffic rights" means the rights for scheduled and non-scheduled services to operate and/or to carry passengers, cargo and mail for remuneration or hire from, to, within, or over a Party, including points to be served, routes to be operated, types of traffic to be carried, capacity to be provided, tariffs to be charged and their conditions, and criteria for designation of airlines, including such criteria as number, ownership and control.

Article 45. Most-favoured-nation Treatment

1. Without prejudice to measures taken in accordance with Article VII of the GATS, and unless otherwise specified in its List of Reservations referred to in Article 57, a Party shall accord immediately and unconditionally, in respect of all measures affecting the supply of services, to services and service suppliers of the other Party treatment no less favourable than that it accords to like services and service suppliers of any non-Party.
2. The provisions of this Chapter shall not be so construed as to prevent either Party from conferring or according advantages to adjacent countries in order to facilitate exchanges limited to contiguous frontier zones of services that are both locally produced and consumed.
3. Treatment granted under other agreements concluded by a Party and notified under Article V or Article Vbis of the GATS shall not be subject to paragraph 1.
4. If a Party concludes or amends an agreement of the type referred to in paragraph 3, it shall notify the other Party without delay and endeavour to accord to the other Party treatment no less favourable than that provided under that agreement. The former Party shall, upon request by the other Party, negotiate the incorporation into this Agreement of treatment no less favourable than that provided under the former agreement.

Article 46. Market Access

1. With respect to market access through the modes of supply identified in paragraph (t) of Article 44, a Party shall accord services and service suppliers of the other Party treatment in conformity with its List of Reservations referred to in Article 57. Note: Unless otherwise specified in its List of Reservations referred to in Article 57 in respect of market access, where the cross-border movement of capital is an essential part of a service supplied through the mode of supply referred to in subparagraph (t)(i) of Article 44, a Party is hereby committed to allow such movement of capital. Unless otherwise specified in its List of Reservations referred to in Article 57 in respect of market access, where a service is supplied through the mode of supply referred to in subparagraph (t)(iii) of Article 44, a Party is hereby committed to allow related transfers of capital into its Area.
2. Unless otherwise specified in its List of Reservations referred to in Article 57, a Party shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire Area measures defined as:
(a) limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;
(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(c) limitations on the total number of service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test; Note: This subparagraph does not cover measures of a Party which limit inputs for the supply of services.
(d) limitations on the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test;
(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and
(f) limitations on the participation of foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of individual or aggregate foreign investment.

Article 47. National Treatment

1. Unless otherwise specified in its List of Reservations referred to in Article 57, each Party shall accord to services and service suppliers of the other Party, in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers. Note: This Article shall not be so construed as to require a Party to compensate for any inherent competitive disadvantage which results from the foreign character of the relevant services and service suppliers.
2. A Party may meet the requirement of paragraph 1 by according to services and service suppliers of the other Party, either formally identical treatment or formally different treatment to that it accords to its own like services and service suppliers.
3. Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of competition in favour of services or service suppliers of a Party compared to like services or service suppliers of the other Party.
4. A Party may not invoke this Article in dispute settlement procedures under Chapter 14 with respect to a measure of the other Party that falls within the scope of an international agreement between the Parties relating to the avoidance of double taxation.

Article 48. Domestic Regulation

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. Where authorisation is required by a Party for the supply of a service, the competent authorities of that Party shall, within a reasonable period of time after the submission of an application is considered complete under that Party's laws and regulations, inform the applicant of the decision concerning the application. At the request of the applicant, the competent authorities of that Party shall provide, without undue delay, information concerning the status of the application.
3. Each Party shall provide for adequate procedures to verify the competence of professionals of the other Party.
4. (a) Each Party shall apply licensing and qualification requirements and procedures and technical standards in a manner which:
(i) is based on objective and transparent criteria, such as competence and the ability to supply the service;
(ii) is not more burdensome than necessary to ensure the quality of the service; and
(iii) in the case of licensing procedures and of verification procedures related to technical standards and to qualification requirements, is not in itself a restriction on the supply of the service.
(b) In determining whether a Party is in conformity with the obligation under subparagraph (a), account shall be taken of international standards of relevant international organisations applied by that Party.
Note: "Relevant international organisations" refers to international bodies whose membership is open to the relevant bodies of both Parties.
5. Paragraphs 1 to 4 are binding upon a Party only in sectors in which it has undertaken specific commitments in its Schedule under the GATS. Note: For the purposes of this paragraph, "sector" means one or more, or all, sub-sectors of the service concerned, as specified in a Party's Schedule under the GATS.
6. Each Party shall maintain or institute as soon as practicable judicial, arbitral or administrative tribunals or procedures which provide, at the request of an affected service supplier of the other Party, for the prompt review of, and where justified, appropriate remedies for, administrative decisions affecting trade in services. 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.
7. The Parties shall jointly review the results of the negotiations provided for in paragraph 4 of Article VI of the GATS with a view to incorporating into this Chapter, as appropriate, any disciplines agreed in such negotiations.

Article 49. Recognition

1. For the purposes of the fulfilment, in whole or in part, of its relevant standards or criteria for the authorisation, licensing or certification of service suppliers, each Party shall give due consideration to any requests by the other Party to recognise the education or experience obtained, requirements met, or licences or certifications granted, in that other Party. Such recognition may be based upon an agreement or arrangement with that other Party, or be accorded autonomously.
2. Where a Party recognises, by an agreement or arrangement, the education or experience obtained, requirements met, or licences or certifications granted, in a non-Party, it shall afford the other Party adequate opportunity to negotiate its accession to such an agreement or arrangement, whether existing or future, or to negotiate a comparable agreement or arrangement with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for the other Party to demonstrate that the education or experience obtained, requirements met, or licences or certifications granted, in the other Party should also be recognised.
3. A Party shall not accord recognition in a manner which would constitute a means of discrimination between countries 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.

Article 50. Movement of Natural Persons

1. This Article shall apply to measures affecting natural persons who are service suppliers of a Party, and natural persons of a Party who are employed by a service supplier of a Party, in respect of the supply of a service.
2. This Chapter shall not apply to measures affecting natural persons seeking access to the employment market of a Party, nor shall it apply to measures regarding nationality or citizenship, residence or employment on a permanent basis.
3. Specific commitments of a Party applying to measures affecting the movement of natural persons of the other Party supplying services are contained in Annex VIII. Natural persons covered by Annex VIII shall be allowed to supply the service in accordance with the terms of this Chapter.
4. For the purposes of this Chapter, paragraph 3 of Article 62 shall apply, mutatis mutandis.

Article 51. Monopolies and Exclusive Service Suppliers

1. A Party shall ensure that any monopoly supplier of a service in its Area does not, in the supply of the monopoly service in the relevant market, act in a manner inconsistent with that Party's obligations under Articles 45 to 47.
2. Where a Party's monopoly supplier competes, either directly or through an affiliated company, in the supply of a service outside the scope of its monopoly rights, that Party shall ensure that such a supplier does not abuse its monopoly position to act in its Area in a manner inconsistent with that Party's obligations under Articles 46 and 47.
3. This Article shall also apply to cases of exclusive service suppliers, where a Party, formally or in effect:
(a) authorises or establishes a small number of service suppliers; and
(b) substantially prevents competition among those suppliers in its Area.

Article 52. Business Practices

1. The Parties recognise that certain business practices of service suppliers, other than those falling under Article 51, may restrain competition and thereby restrict trade in services.
2. Without prejudice to Chapter 10, a Party shall, at the request of the other Party, enter into consultations with a view to eliminating practices referred to in paragraph 1. The Party addressed shall accord full and sympathetic consideration to such a request and shall cooperate through the supply of publicly available non-confidential information of relevance to the matter in question. The Party addressed shall also provide other information available to the requesting Party, subject to its law and to the conclusion of a satisfactory agreement concerning the safeguarding of its confidentiality by the requesting Party.

Article 53. Payments and Transfers

1. Except under the circumstances envisaged in Article 54, a Party shall not apply restrictions on international transfers and payments for current transactions and capital transactions relating to trade in services.
2. Nothing in this Chapter shall affect the rights and obligations of the Parties as members of the International Monetary Fund under the Articles of Agreement of the International Monetary Fund, including the use of exchange actions which are in conformity with the Articles of Agreement of the International Monetary Fund, provided that a Party shall not impose restrictions on any capital transactions inconsistently with the obligations under this Chapter regarding such transactions, except under Article 54, or at the request of the International Monetary Fund.

Article 54. Restrictions to Safeguard the Balance of Payments

1. The Parties endeavour to avoid the imposition of restrictions to safeguard the balance of payments.
2. In the event of serious balance-of-payments and external financial difficulties or threat thereof, a Party may adopt or maintain restrictions on trade in services, including on payments or transfers for transactions.
3. The restrictions adopted or maintained by a Party referred to in paragraph 2:
(a) shall ensure that the other Party is treated as favourably as any non-Party;
(b) shall be consistent with the Articles of Agreement of the International Monetary Fund;
(c) shall avoid unnecessary damage to the commercial, economic and financial interests of the other Party; (d) shall not exceed those necessary to deal with the circumstances described in paragraph 2; and (e) shall be temporary and be phased out progressively as the situation specified in paragraph 2 improves.
4. In determining the incidence of such restrictions, a Party may give priority to the supply of services which are more essential to its economic programme. However, such restrictions shall not be adopted or maintained for the purposes of protecting a particular service sector.
5. Any restrictions adopted or maintained by a Party under paragraph 2, or any changes therein, shall be promptly notified to the other Party.

Article 55. General Exceptions

Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail, or a disguised restriction on trade in services, nothing in this Chapter shall be so construed as to prevent the adoption or enforcement by either Party of measures:
(a) necessary to protect public morals or maintain public order; Note: The public order exception may be invoked only where a genuine and sufficiently serious threat is posed to one of the fundamental interests of society.
(b) necessary to protect human, animal or plant life or health;
(c) necessary to secure compliance with laws or regulations of the Party which are not inconsistent with the provisions of this Chapter including those relating to:
(i) the prevention of deceptive and fraudulent practices or to deal with the effects of a default on services contracts;
(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts; and
(iii) safety;
(d) inconsistent with Article 47, provided that the difference in treatment is aimed at ensuring the equitable or effective imposition or collection of direct taxes in respect of services or service suppliers of the other Party; Note: Measures that are aimed at ensuring the equitable or effective imposition or collection of direct taxes include measures taken by a Party under its taxation system which: (i) apply to non-resident service suppliers in recognition of the fact that the tax obligation of non-residents is determined with respect to taxable items sourced or located in the Area of the Party;
(ii) apply to non-residents in order to ensure the imposition or collection of taxes in the Area of the Party;
(iii) apply to non-residents or residents in order to prevent the avoidance or evasion of taxes, including compliance measures;
(iv) apply to consumers of services supplied in or from the Area of the other Party in order to ensure the imposition or collection of taxes on such consumers derived from sources in the Area of the Party;
(v) distinguish service suppliers subject to tax on worldwide taxable items from other service suppliers, in recognition of the difference in the nature of the tax base between them; or
(vi) determine, allocate or apportion income, profit, gain, loss, deduction or credit of resident persons or branches, or between related persons or branches of the same person, in order to safeguard the Party's tax base. Tax terms or concepts in this paragraph and this Note are determined according to tax definitions and concepts, or equivalent or similar definitions and concepts, under the law of the Party taking the measure.
(e) inconsistent with Article 45, provided that the difference in treatment is the result of an agreement on the avoidance of double taxation or provisions on the avoidance of double taxation in any other international agreement or arrangement by which the Party is bound.

Article 56. Security Exceptions

Nothing in this Chapter shall be so construed as:
(a) to require either Party to furnish any information, the disclosure of which it considers contrary to its essential security interests;
(b) to prevent either Party from taking any action which it considers necessary for the protection of its essential security interests:
(i) relating to the supply of services as carried out directly or indirectly for the purpose of provisioning a military establishment;
(ii) relating to fissionable and fusionable materials or the materials from which they are derived;
(iii) taken in time of war or other emergency in international relations; or
(c) to prevent either Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

Article 57. Lists of Reservations

1. The List of Reservations of the Parties referred to in Articles 45 to 47 shall be set out in Annex III.
2. The List of Reservations of a Party set out in Annex III provides for:
(a) existing measures that the Party may maintain, renew at any time or modify without reducing their level of conformity with Articles 45 to 47; and
(b) measures that the Party may adopt, maintain or modify.

Article 58. Modification of Lists of Reservations

1. A Party shall notify to the other Party its intention to modify its List of Reservations set out in Annex III. Upon written request of the other Party within 30 days from the receipt of the notification, the Parties shall hold consultations on any necessary compensatory adjustment with the aim to ensure that the general level of mutually advantageous commitments under this Chapter is not reduced. If the Parties fail to reach an agreement on compensation within 60 days after the receipt of the request for consultations, the Party receiving the notification may refer the matter to arbitration by an arbitral tribunal established following the same procedures as provided for in paragraphs 3 to 7 of Article 141. Such an arbitral tribunal shall present its findings as to the ways to ensure that the general level of mutually advantageous commitments under this Chapter is not reduced. Article 143 shall apply to the proceedings of such an arbitral tribunal mutatis mutandis.
2. If no consultations are requested, or once the Party which made the notification under paragraph 1 has made compensatory adjustments as agreed upon by the Parties or in conformity with the outcome of arbitration, the modification shall be incorporated into Annex III in accordance with the procedures set out in Article 152.
3. If a compensatory adjustment has been made by a Party to the benefit of the other Party as an "affected Member" in accordance with Article XXI of the GATS with regard to the same modification as intended for the List of Reservations of the former Party set out in Annex III, the Parties shall be deemed to have reached an agreement on compensation referred to in paragraph 1 with the same conclusion as agreed in the said compensatory adjustment.

Article 59. Transparency

1. Each Party shall publish promptly and, except in emergency situations, at the latest by the time of their entry into force, all relevant measures of general application which pertain to or affect the operation of this Chapter. International agreements pertaining to or affecting trade in services to which a Party is a signatory shall also be published.
2. Where publication as referred to in paragraph 1 is not practicable, such information shall be made otherwise publicly available.

Article 60. Review

1. With the objective of further liberalising trade in services between them, the Parties shall review at least every two years, or more frequently if so agreed, their Lists of Reservations set out in Annex III. The first such review shall take place not later than two years after the entry into force of this Agreement.
2. If, after the entry into force of this Agreement, a Party further liberalises autonomously any of its services sectors, sub-sectors or activities, it shall consider any requests by the other Party for the incorporation into this Agreement of such autonomous liberalisation.

Article 61. Annexes

Annexes III, IV, V, VI and VII form an integral part of this Chapter.

Section CHAPTER 7. Movement of Natural Persons

Article 62. Scope

1. This Chapter shall apply to measures affecting the movement of natural persons of a Party who enter and stay temporarily in the other Party.
2. This Chapter shall not apply to measures affecting natural persons of a Party seeking access to the employment market of the other Party, nor shall it apply to measures regarding nationality or citizenship, residence or employment on a permanent basis.
3. This Chapter shall not prevent a Party from applying measures to regulate the entry of natural persons of the other Party into, or their temporary stay in, the former Party, including measures necessary to protect the integrity of, and to ensure the orderly movement of natural persons across, its borders, provided that such measures are not applied in such a manner as to nullify or impair the benefits accruing to the other Party under the terms of the specific commitments set out in Annex VIII. Note: The sole fact of requiring a visa for natural persons of a certain nationality and not for those of others shall not be regarded as nullifying or impairing benefits under the terms of the specific commitments.

Article 63. General Principles

1. This Chapter reflects the preferential trading relationship between the Parties, the desire of the Parties to facilitate the movement of natural persons on a mutually beneficial basis and to establish transparent criteria and procedures for the movement of natural persons, and the need to ensure border security and to protect the domestic labour force and permanent employment in either Party.
2. Each Party shall apply its measures relating to the provisions of this Chapter in accordance with paragraph 1, and, in particular, shall apply such measures expeditiously so as to avoid unduly impairing or delaying trade in goods or services or conduct of investment activities under this Agreement.

Article 64. Definitions

For the purposes of this Chapter, "natural person of a Party" means a natural person who, under the legislation of the Party, is:
(a) in respect of Japan, a national of Japan; or
(b) in respect of Switzerland,
(i) a national of Switzerland; or
(ii) a permanent resident who is a service supplier in the Area of Switzerland.

Article 65. Grant of Entry and Temporary Stay

1. Each Party shall grant entry and temporary stay to natural persons of the other Party in accordance with this Chapter and relevant laws and regulations of the former Party, and subject to the terms of the specific commitments set out in Annex VIII.
2. Each Party shall ensure that fees charged by its competent authorities for processing application for entry and temporary stay of natural persons of the other Party for business purposes are charged having regard to the administrative costs involved.

Article 66. Provision of Information

1. Each Party shall make publicly available information with respect to natural persons covered by its specific commitments set out in Annex VIII, including information necessary for an effective application for the grant of entry into, and temporary stay and work in, that Party. Such information shall be kept updated.
2. The information referred to in paragraph 1 shall include a description of, in particular:
(a) in respect of Japan: with respect to all the statuses of residence that are relevant to the grant of entry into, and temporary stay and work in, Japan for natural persons of Switzerland covered in Japan's specific commitments in Annex VIII:
(i) visas and certificates of eligibility;
(ii) requirements and procedures for application for, and issuance of, visas and certificates of eligibility, including information on documentation required, conditions to be met and method of application; and
(iii) requirements and procedures for application for, and grant of, renewal of period of temporary stay; or
(b) in respect of Switzerland: with respect to the grant of entry into, and temporary stay and work in, Switzerland for natural persons of Japan covered in Switzerland's specific commitments in Annex VIII:
(i) all categories of visas and work permits;
(ii) requirements and procedures for application for, and issuance of, visas and work permits, including information on documentation required, conditions to be met and method of application; and
(iii) requirements and procedures for application for, and grant of, renewal of temporary stay and work permits.
3. Each Party shall provide the other Party with details of relevant publications or websites where information referred to in paragraph 2 is made available.
4. If the implementation of paragraph 1 proves to be impracticable for a Party, that Party shall provide the information referred to in paragraph 2, as well as any subsequent change therein, directly to the other Party. In addition, that Party shall indicate the contact details of its authority where persons of the other Party may obtain the information referred to in paragraph 2.
5. Each Party shall, to the extent possible, upon request by the other Party, make available to the other Party statistical data regarding the grant of entry into and temporary stay in the former Party for natural persons of the other Party under this Chapter.

Article 67. Expeditious Application Procedures

1. The competent authorities of each Party shall process without delay applications for the grant of entry and temporary stay or, where applicable, work permits or certificates of eligibility submitted for natural persons of the other Party, including applications for renewal thereof.
2. If the competent authorities of a Party require additional information from the applicant in order to process the application, they shall endeavour to notify the applicant without undue delay.
3. Upon request by the applicant, the competent authorities of a Party shall endeavour to provide, without undue delay, information concerning the status of the application.
4. After a decision has been taken, the competent authorities of a Party shall endeavour to notify without undue delay the applicant for entry and temporary stay or, where applicable, work permit or certificate of eligibility, of the outcome of the application. The notification shall include the period of stay and any other conditions.

Article 68. Measures Pursuant to Immigration Laws and Regulations

Except for this Chapter and Chapters 1, 14 and 16, nothing in this Agreement shall impose any obligation on either Party regarding measures pursuant to immigration laws and regulations.