Article 10.1. Definitions
For the purposes of this Chapter:
TBT Agreement means the Agreement on Technical Barriers to Trade, which is part of the WTO Agreement;
to make compatible means to bring different standardization measures, approved by different standards bodies, but with the same scope, to such a level that they are identical, equivalent or have the effect of allowing the goods to be used interchangeably or for the same purpose;
standardization measures means technical regulations or mandatory technical standards, conformity assessment procedures applicable thereto, approval or authorization procedures and metrology;
standard means a document approved by a recognized institution that provides, for common and repeated use, rules, guidelines or characteristics for related goods or processes and production methods, compliance with which is not mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labeling requirements applicable to a commodity, process or production method;
international standard means that standard, guide, recommendation or normative specification that is adopted by an international standardizing body, in accordance with the guidelines and recommendations established in the TBT Agreement, as well as the provisions of this Chapter;
legitimate objectives means the imperatives of national security, the prevention of practices that may mislead consumers, the protection of human health or safety, animal or plant life or health, or the environment;
international standardizing and metrology body means a standardizing body open to participation by the relevant bodies of at least all Members of the TBT Agreement, including the International Organization for Standardization (ISO), the Intemational Electrotechnical Commission (IEC), the Codex Alimentarius Commission, the Intemational Organization of Legal Metrology (OIML) and the Intemational Commission on Radiological Units and Measurements (ICUMR) or such other body as the Parties may designate;
approval or authorization procedure means any mandatory administrative process for obtaining a registration, permit, license or any other authorization, other than customs procedures and border inspections and controls, in order for a good to be produced, marketed or used for defined purposes or in accordance with established conditions;
conformity assessment procedure means any procedure used, directly or indirectly, to determine whether relevant requirements established by technical regulations or mandatory technical standards or standards are met, comprising, inter alia, sampling, testing and inspection, evaluation, verification and assurance of conformity, registration, accreditation and approval, either separately or in various combinations;
administrative rejection means the actions taken by an organ of the public administration of the importing Party in the exercise of its powers, to prevent the entry into its territory of a good, for non-compliance with technical regulations or mandatory technical standard, conformity assessment procedure or metrology;
technical regulation or mandatory technical rule means a document that establishes the characteristics of goods or their related processes and production methods, including the applicable administrative provisions and whose observance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labeling requirements applicable to a good, process or production method; and
comparable situation means one that guarantees the same level of security or protection to achieve a legitimate objective.
The terms used in this Chapter shall have the meaning assigned to them in Annex 1 of the TBT Agreement, in addition to those contained in this Chapter.
Article 10.2. General Provisions
1. The objectives of this Chapter are to increase and facilitate trade in goods and to obtain effective market access through proper implementation of the TBT Agreement.
2. The provisions of this Chapter are intended to ensure that the standardization measures and standards of the Parties do not constitute unnecessary barriers to trade.
3. Each Party shall ensure, in accordance with its domestic law, compliance with the obligations of this Chapter in its territory and, in this regard, shall adopt such measures as may be available to it with respect to non-governmental standardizing bodies in its territory.
4. Disputes arising in connection with the application of this Chapter shall be resolved through the dispute settlement provisions of this Agreement. The Parties may use the Understanding on Rules and Procedures Governing the Settlement of Disputes of the WTO for those provisions that are contained in the TBT Agreement.
Article 10.3. Scope and Coverage
1. This Chapter applies to the elaboration, adoption and application of all standardization measures and standards that may, directly or indirectly, affect trade in goods between the Parties, including any amendments thereto and any additions to their rules or to the list of products to which they refer.
2. Notwithstanding the provisions of paragraph 1, this Chapter does not apply to:
(a) the technical specifications established by public entities for the production or consumption requirements of such entities; and
(b) sanitary and phytosanitary measures.
Article 10.4. Basic Rights and Obligations
1. The Parties agree to reaffirm compliance with the rights and obligations contained in the TBT Agreement. In addition to the foregoing, the Parties shall be governed by the rights and obligations of this Chapter.
2. Each Party may develop, adopt, implement and maintain standardization measures to ensure the achievement of its legitimate objectives.
3. The Parties understand that the elaboration, adoption and application of technical regulations or mandatory technical standards, standards and conformity assessment procedures shall be based on the provisions of the TBT Agreement and the provisions of this Chapter.
Article 10.5. Trade Facilitation
1. The Parties will seek to identify trade facilitating initiatives in relation to their standardization measures and standards and increase understanding of each other's national systems.
2. Each Party shall permit persons of the other Party to participate in the development of its technical regulations or mandatory technical standards, standards, conformity assessment procedures and metrology, on terms no less favorable than those accorded to its own persons and those of any other country.
3. Each Party shall recommend that non-governmental standardizing bodies located in its territory comply with the preceding paragraph.
4. When a Party administratively rejects a good originating in the territory of the other Party due to a perceived non-compliance with a technical regulation or mandatory technical standard, it shall promptly notify the importer in writing of the reasons for its rejection, by means such as fax, courier document, e-mail or other suitable means.
5. The Parties agree to strengthen and guide, to the extent possible, their activities in the area of standardization measures and standards, based on the recommendations of international standardization, accreditation and metrology forums.
Article 10.6. Use of International Standards
Without prejudice to its rights and obligations under the TBT Agreement and the provisions of this Chapter, each Party shall use existing or imminently adopted international standards, or relevant elements thereof, for the development or implementation of its standardization measures and standards, except where such international standards do not constitute an effective or appropriate means to achieve its legitimate objectives, for example, fundamental climatic, geographical, technological, infrastructural factors, or for scientifically proven reasons, in accordance with the provisions of this Chapter.
Article 10.7. Compatibility and Equivalence
Without prejudice to their rights and obligations under the TBT Agreement and the provisions of this Chapter, and taking into account international standardization and metrology activities, the Parties shall, to the greatest extent possible, make their respective standardization measures compatible, without reducing the level of safety or protection of human, animal or plant life or health, the environment or consumers.
Article 10.8. Technical Regulations or Mandatory Technical Standards
1. A Party shall accept a technical regulation or mandatory technical standard adopted by the other Party as equivalent to one of its own when, in cooperation with that other Party, the importing Party determines that the technical regulations of the exporting Party adequately meet the legitimate objectives of the importing Party.
2. At the request of the exporting Party, the importing Party shall communicate in writing the reasons why it does not accept a technical regulation or mandatory technical standard as equivalent, in accordance with paragraph 1.
3. Where a Party accepts as its own the technical regulations or mandatory technical standards or conformity assessment procedures of a third country and does not accept as equivalent the technical regulations or mandatory technical standards or conformity assessment procedures of the other Party, it shall, upon request of that other Party, explain the reasons for its decision.
Article 10.9. Conformity Assessment
1. In order to advance trade facilitation, a Party shall favorably consider, at the request of the other Party, entering into negotiations aimed at concluding agreements on mutual recognition of the results of their respective conformity assessment procedures.
The Parties recognize that a wide range of mechanisms exist to facilitate the acceptance in the territory of one Party of the results of conformity assessment procedures carried out in the territory of the other Party, such as:
(a) the importing Party may accept a supplier's declaration of conformity;
(b) Conformity assessment bodies operating in the territory of a Party may establish voluntary agreements with conformity assessment bodies operating in the territory of the other Party to accept or validate the results of their conformity assessment procedures;
(c) A Party may adopt accreditation procedures to qualify conformity assessment bodies located in the territory of the other Party;
(d) A Party may designate conformity assessment bodies located in the territory of the other Party;
(e) a Party may agree with the other Party to accept the results of conformity assessment procedures carried out by entities located in the territory of the other Party with respect to specific technical regulations or mandatory technical standards; and
(f) A Party may recognize the results of conformity assessment procedures carried out in the territory of the other Party.
2. Each Party may accept the results of conformity assessment procedures carried out in the territory of the other Party, provided that they offer a satisfactory assurance equivalent to that offered by the procedures carried out or to be carried out in its territory and the result of which it accepts.
3. In the event that a Party does not accept the results of a conformity assessment procedure carried out in the territory of the other Party, it shall, at the request of that other Party, explain the reasons for its decision so that the necessary corrective actions may be taken.
4. Prior to acceptance of the results of a conformity assessment procedure in accordance with paragraph 2 and in order to strengthen the sustained reliability of each Party's conformity assessment results, the Parties may consult on matters such as the technical capability of the conformity assessment bodies concerned, including verified compliance with relevant international standards, through such means as accreditation.
5. In recognition that this should be to the mutual benefit of the Parties concerned, each Party shall accredit, approve or otherwise recognize conformity assessment bodies in the territory of the other Party, on terms no less favorable than those accorded to such bodies in its territory.
6. For conformity assessment procedures, the Parties may use the capacity and technical infrastructure of accredited bodies established in the territory of the Parties.
Article 10.10. Approval or Authorization Procedures
1. Each Party shall develop, adopt and apply approval or authorization procedures so as to grant access to like goods from the territory of the other Party on terms no less favorable than those accorded to its like goods or to those of any other non-Party in a comparable situation.
2. In connection with its approval or authorization procedures, each Party shall be obliged that:
(a) such proceedings are initiated and concluded as expeditiously as possible and in a nondiscriminatory order;
(b) the processing of each of these procedures is published or, upon request, the information is communicated to the applicant;
(c) the competent body or authority shall promptly examine, upon receipt of an application, the completeness of the documentation and inform the applicant of any deficiencies in a precise and complete manner, transmit to the applicant as soon as possible the results of the authorization in a precise and complete manner, so that corrective action can be taken if necessary, and inform the applicant of the stage reached in the procedure, explaining any delays;
(d) only the information necessary to authorize and calculate the fees is required;
(e) the confidentiality of information relating to a good of the other Party resulting from such procedures or provided in connection therewith shall be respected in the same manner as in the case of a good of that Party;
(f) the fees to be imposed for the approval or authorization procedure for a good of the other Party are equitable in comparison with those that would be charged for the approval or authorization procedure for a good of that Party, taking into account the costs of communications, transportation and other costs arising from differences in the location of the applicant's facilities and those of the approval or authorization procedure body; and
(g) that a procedure be established to review complaints regarding the application of an approval or authorization procedure and to take corrective action when the complaint is justified.
Article 10.11. Metrology
Each Party shall ensure, to the extent possible, the documented traceability of its standards and the calibration of its measuring instruments, as recommended by the International Bureau of Weights and Measures (BIPM) and the OIML, complying with the provisions of this Chapter.
Article 10.12. Notifications and Exchange of Information
1. In cases where there is no relevant international standard or where the technical content of a technical regulation or mandatory technical standard or conformity assessment procedure applicable to a technical regulation or mandatory technical standard in draft form is not in conformity with the technical content of the relevant international standards and provided that such technical regulation or mandatory technical standard may have a significant effect on the trade of the Parties, the Parties undertake to:
(a) exchange information on standards, technical regulations or mandatory technical standards and conformity assessment procedures, particularly those that may affect reciprocal trade;
(b) upon request of the other Party, provide information about the basic standard and the legitimate objective of the technical regulation or mandatory technical standard, or conformity assessment procedure that the Party has adopted or intends to adopt;
(c) transmit the proposed technical regulation or mandatory technical standard, or conformity assessment procedures applicable thereto, electronically to the other Parties through the contact points that each Party has established under Article 10 of the TBT Agreement, while notifying other WTO Members of the proposal in accordance with the TBT Agreement;
(d) provide in printed or electronic form within a reasonable period, any information or explanation that is required at the request of a Party in accordance with the provisions of this Chapter. The Party shall endeavor to respond to each request within sixty (60) days;
(e) apply in accordance with Article 10 of the WTO TBT Agreement, the recommendations indicated in the document Decisions and Recommendations adopted by the Committee since January 1, 1995, G/TBT/1/Rev.8, May 23, 2002, Section IV (Information Exchange Procedure) expressed by the WTO Committee on Technical Barriers to Trade;
(f) allow at least sixty (60) days after the notification, so that the persons and the other Parties may make written comments on the proposal of a technical regulation or mandatory technical standard or a conformity assessment procedure applicable to them, in order to allow the interested parties during this period to present and formulate comments and consultations so that the notifying Party may take them into account. A Party shall give favorable consideration to reasonable requests for extension of the period established for comments; and
(g) each Party shall annually notify the other Party in writing of its standardization plans and programs and shall make them available in a reasonable time to the information center of the other Party.
2. If urgent problems of safety, health, environmental protection or national security arise or threaten to arise for a Party, that Party may omit to give prior notification of the project, but once it is adopted it shall immediately notify and send it to the other Party.
3. The notifications set forth in paragraphs 1 and 2 shall be made in accordance with the formats set forth in the TBT Agreement.
Article 10.13. Information Centers
1. Each Party shall ensure that there is an information center in its territory capable of responding to all reasonable inquiries and requests from the other Party and interested persons, as well as providing relevant updated documentation regarding standardization measures or standards applicable thereto, adopted or proposed in its territory, by governmental or non-governmental bodies.
2. Each Party designates the information center indicated in Annex 10.13.
Article 10.14. Cooperation and Technical Assistance
1. The Parties shall promote cooperation on standards, technical regulations or mandatory technical standards, conformity assessment and metrology with a view to facilitating market access, increasing understanding of each other's national systems and strengthening the bonds of trust between the Parties.
2. At the request of a Party, the other Party shall provide, to the extent of its possibilities and taking into account the level of development of the requesting Party, advice, information and assistance to strengthen national standardization, conformity assessment and metrology systems.
3. The Parties shall develop cooperation and technical assistance programs aimed at achieving full and effective compliance with the obligations established in the TBT Agreement.
4. At the request of the other Party, a Party shall give favorable consideration to any proposal aimed at:
(a) facilitate trade for a specific sector and encourage greater cooperation under this Chapter;
(b) develop mechanisms to promote equivalence between technical regulations or mandatory technical standards and conformity assessment procedures applicable to them; mutual recognition agreements and the designation in the territory of the other Party of its conformity assessment bodies;
(c) create cooperation and technical assistance programs aimed at achieving standardization measures and harmonized standards;
(d) facilitate the coordination of the Parties' standardization bodies for their participation in international standardization processes; and
(e) support the development and application of international standards.
Article 10.15. Technical Consultation
1. When a Party considers that a standardization measure of the other Party is interpreted or applied in a manner inconsistent with the provisions of this Chapter, it shall deliver its written request to the other Party, including the identification of the standardization measure in force or in the pipeline and the reasons supporting the existence of the inconsistency.
2. When a Party requests consultations and so notifies the Committee, the Committee shall facilitate the consultations, and may refer them to an ad-hoc working group for the purpose of obtaining non-binding technical advice or recommendations from them.
3. When the Parties have resorted to consultations pursuant to this Article, without satisfactory results, such consultations shall constitute those provided for in the Chapter on Dispute Settlement, if the Parties so agree.
4. The Parties shall make every effort to reach a mutually satisfactory solution within a period of sixty (60) days.
Article 10.16. Technical Barriers to Trade Committee
1. The Parties establish the Committee on Technical Barriers to Trade, which shall be composed of representatives of each Party, in accordance with Annex 10.16.
2. The Committee shall hear matters relating to this Chapter and shall serve, inter alia, as a forum to promote consultation and cooperation on matters related to this Chapter, as well as to discuss and resolve problems identified by the Parties.
3. The Committee shall have the following functions:
(a) to follow up on the implementation and administration of this Chapter;
(b) identify and ensure that unnecessary technical barriers to trade are eliminated;
(c) facilitate the process through which the Parties will make compatible their respective measures relating to technical regulations or mandatory technical standards, standards and conformity assessment procedures applicable to them;
(d) Ensure that conformity assessment procedures applicable to technical regulations or mandatory technical standards do not constitute disguised barriers to trade and that their application is carried out in the most expeditious, transparent and non-discriminatory manner possible;
(e) to promote that the Parties' legal metrology activities are carried out in accordance with OIML guidelines, recommendations and documents and that the Parties ensure, as far as possible, the traceability of their metrological standards as recommended by the BIPM and the OIML;
(f) analyze and propose solutions for those measures related to technical regulations or mandatory technical standards, conformity assessment procedures and metrology applicable to them, which a Party considers a technical barrier to trade;
(g) as appropriate, facilitate sectoral cooperation between governmental and non-governmental standardization bodies, accreditation and conformity assessment in the territories of two (2) or more Parties;
(h) at the request of a Party, facilitate consultations on any matter arising under this Chapter;
(i) establish, if necessary, for particular matters or sectors, working groups for the treatment of specific matters related to this Chapter, such as standardization measures or standards; and
(j) report to the Commission on the implementation of this Chapter.
3. The Committee shall meet at least once (1) a year, unless otherwise agreed by the Parties.
4. The Committee may also consult and carry out its work through the means of communication agreed upon by the Parties, such as e-mail, videoconferences or others.
5. The Parties may hold bilateral meetings when it is not possible to convene the Committee, provided that all Parties are duly informed of the objectives of such a meeting.
6. All recommendations of the Committee shall be made by consensus, unless the Committee decides otherwise.
7. The Committee shall establish its rules and procedures within six (6) months after the entry into force of the Treaty.
Part FOUR. PUBLIC PROCUREMENT
Chapter 11. PUBLIC PROCUREMENT
Article 11.1. Coverage
1. Subject to the terms and conditions set out in Annex 11.1, Section A, this Chapter applies to measures relating to procurement of goods and services, including construction services, or any combination thereof, through any contractual means, including purchase and rental or lease, with or without option to purchase, by public entities of each Party, when they issue an open invitation to participate or to submit a tender, in accordance with the procurement modalities or regimes provided for in the legislation of each Party, listed in Annex 11.1, Section B.
2. This Chapter does not apply to:
(a) non-contractual arrangements or any form of assistance that a Party or a state enterprise provides, including grants, loans, capital transfers, tax incentives, subsidies, grants, guarantees, cooperation agreements, government provision of goods and services to persons or central or local governments, and purchases for the direct purpose of providing foreign assistance;
(b) procurement financed by loans or grants to a Party, including an entity of a Party, by a person, international entities, associations, another Party, or a non-Party, to the extent that such loans or grants establish conditions inconsistent with the provisions of this Chapter;
(c) the procurement of fiscal agency or depository services, settlement and administration services for regulated financial institutions, and sales and distribution services for public debt;
(d) the contracting of public employees and employment-related measures; and
(e) purchases made under exceptionally favorable conditions that only occur for a very short period of time, such as extraordinary disposals made by companies that are not normally suppliers or the disposal of assets of companies in liquidation or under receivership.
3. For greater certainty, this Chapter does not apply to the procurement of banking, financial or specialized services relating to the following activities:
(a) public borrowing; or
(b) public debt and liability management.
4. For greater certainty:
(a) where a public entity is to award a contract that is not covered, any goods or services that are part of such contract shall not be included in the coverage of this Chapter; and
(b) the procurement of goods or services by a non-covered public entity shall be excluded from this Chapter.
Article 11.2. National Treatment, Non-Discrimination, and Transparency
With respect to coverage under this Chapter:
(a) each Party shall accord to goods, services, including construction services, and suppliers (1) of the other Party, treatment no less favorable than that it accords to its own goods, services and suppliers;
(b) no Party,
(i) shall accord to a locally established supplier less favorable treatment than that accorded to another locally established supplier because of the degree of association or foreign ownership; nor shall it accord a locally established supplier less favorable treatment than that accorded to another locally established supplier because of the degree of association or foreign ownership; or
(ii) shall discriminate against a locally established supplier on the ground that the goods or services offered by such supplier are goods or services of the other Party;
(c) each Party shall apply its procurement procedures in a manner that allows for the maximum possible competition and respects the principles of transparency, publicity and non-discrimination; and
(d) no Party or public entity of a Party shall establish requirements that have the purpose or effect of circumventing the obligations of this Chapter or creating unnecessary obstacles to trade.
2. With respect to covered procurement, a government entity shall refrain from taking into account, requesting or imposing special countervailing conditions at any stage of the procurement. For purposes of this Chapter, special countervailing conditions means conditions or commitments imposed or considered by a governmental entity that promote local development or improve a Party's balance of payments accounts through local content requirements, licensing for the use of technology, investment, countertrade or similar requirements.
3. Paragraphs 1 and 2 do not apply to measures relating to customs duties and other charges of any kind imposed on or in connection with importation, to the method of levying such duties or charges, to other import regulations, including restrictions and formalities, or to measures affecting trade in services, in all modes of supply, other than measures specifically regulating government procurement covered by this Chapter.
4. Each Party shall forward to the other Party its laws, regulations and other regulations of general application relating to government procurement and, in the event of changes, shall forward them to the other Party as soon as possible.
5. Nothing in this Chapter shall prevent a Party from developing new procurement policies, or adopting and amending its laws, regulations and practices relating to procurement, provided that they are not inconsistent with the provisions of this Chapter.
6. For purposes of the application of this Chapter, where there are provisions in domestic laws that establish qualification criteria that provide for domestic value- added requirements, the same requirements for goods or services of that Party shall apply to goods or services of the other Party. For purposes of goods, the Parties shall allow the incorporation of originating materials or originating (2) of one or more of the Parties into a good of one of the Parties.