4. For conditions affecting trade of the commodities referred to in paragraph 1(a) of this Article, upon request of the exporting Party, the Parties shall enter into consultations within the SPS Sub-Committee in accordance with the provisions of Article 65 of this Agreement, in order to agree on alternative or additional import conditions of the importing Party. Such alternative or additional import conditions may, when appropriate, be based on measures of the exporting Party recognised as equivalent by the importing Party. If agreed, the importing Party shall within 90 days take the necessary legislative and/or administrative measures to allow import on the basis of the agreed import conditions.
5. List of establishments, provisional approval
(a) For the import of animal products referred to in Part 2 of Annex IV-A to this Agreement, upon request of the exporting Party accompanied by the appropriate guarantees, the importing Party shall provisionally approve processing establishments referred to in Annex VII.2 to this Agreement which are situated in the territory of the exporting Party, without prior inspection of individual establishments. Such approval shall be consistent with the conditions and provisions set out in Annex VII to this Agreement. Except when additional information is requested, the importing Party shall take the necessary legislative and/or administrative measures to allow import on that basis within 30 working days following the date of receipt of the request and the relevant guarantees by the importing Party.
The initial list of establishments shall be approved in accordance with the provisions of Annex VII to this Agreement.
(b) For the import of animal products referred to in paragraph 2(a) of this Article, the exporting Party shall inform the importing Party of its list of establishments meeting the importing Party's requirements.
6. Upon request of a Party, the other Party shall provide the necessary explanation and the supporting data for the determinations and decisions covered by this Article.
Article 61. Certification Procedure
1. For purposes of certification procedures and issuing of certificates and official documents the parties agree on the principles set out in Annex X to this Agreement.
2. The SPS Sub-Committee referred to in Article 65 of this Agreement may agree on the rules to be followed in case of electronic certification, withdrawal or replacement of certificates.
3. In the framework of approximated legislation as referred to in Article 55 of this Agreement, the Parties shall agree on common models of certificates, where applicable.
Article 62. Verification
1. In order to maintain confidence in the effective implementation of the provisions of this Chapter each Party has the right:
(a) to carry out verification of all or part of the inspection and certification system of the other Party's authorities, and/or of other measures, where applicable, in accordance with the relevant international standards, guidelines and recommendations of Codex Alimentarius, OIE and IPPC;
(b) to receive information from the other Party about its control system and be informed of the results of the controls carried out under that system respecting the confidentiality provisions applicable in either Party.
2. Either Party may share the results of the verifications referred to in paragraph 1(a) of this Article with third parties and make the results publicly available as may be required by provisions applicable to either Party. Confidentiality provisions applicable to either Party shall be respected in such sharing and/or publication of the results, where appropriate.
3. If the importing Party decides to carry out a verification visit to the exporting Party, the importing Party shall notify the exporting Party of this verification visit at least 60 working days before the verification visit is to be carried out, except in emergency cases or if the Parties agree otherwise. Any modification to this visit shall be agreed by the Parties.
4. The costs incurred in undertaking a verification of all or part of the other Party's competent authorities' inspection and certification systems and/or other measure, where applicable, shall be borne by the Party carrying out the verification or the inspection.
5. The draft written communication of verifications shall be forwarded to the exporting Party within 60 working days after the end of verification. The exporting Party shall have 45 working days to comment on the draft written communication. Comments made by the exporting Party shall be attached to and, where appropriate included in the final outcome. However, where a significant human, animal or plant health risk has been identified during the verification, the exporting Party shall be informed as quickly as possible and in any case within 10 working days following the end of the verification.
6. For clarity the results of verification may contribute to the procedures referred to in Articles 55, 57 and 63 of this Agreement conducted by the Parties or one of the Parties.
Article 63. Import Checks and Inspection Fees
1. The Parties agree that import checks by the importing Party of consignments from the exporting Party shall respect the principles set out in Part A of Annex IX to this Agreement. The results of these checks may contribute to the verification process referred to in Article 62 of this Agreement.
2. The frequencies of physical import checks applied by each Party are set out in Part B of Annex IX to this Agreement. A Party may amend these frequencies within its competences and in accordance with its internal legislation, as a result of progress made in accordance with Articles 55, 57 and 60 of this Agreement, or as a result of verifications, consultations or other measures provided for in this Agreement. SPS Sub-Committee referred to in Article 65 shall modify Part B of Annex IX to this Agreement by decision, accordingly.
3. Inspection fees, if applicable, may only cover the costs incurred by the competent authority for performing import checks. The fee shall be calculated on the same basis as the fees charged for the inspection of similar domestic products.
4. The importing Party shall upon request of the exporting Party inform the latter of any amendment, including the reasons for such an amendment concerning the measures affecting import checks and inspection fees, and of any significant changes in the administrative conduct for such checks.
5. From a date to be determined by the SPS Sub-Committee referred to in Article 65 of this Agreement, the Parties may agree on the conditions to approve each other's controls referred to in Article 62(1)(b) of this Agreement with a view to adapt and reciprocally reduce, where applicable, the frequency of physical import checks for the commodities referred to in Article 60(2)(a) of this Agreement.
From that date the Parties may reciprocally approve each other's controls for certain commodities and, consequently reduce or replace the import checks for these commodities.
Article 64. Safeguard Measures
1. Should the exporting Party take measures within its territory to control any cause likely to constitute a serious hazard or risk to human, animal or plant health, the exporting Party, without prejudice to the provisions of paragraph 2 of this Article, shall take equivalent measures to prevent the introduction of the hazard or risk into the territory of the importing Party.
2. On the basis of serious human, animal or plant health grounds, the importing Party may, take provisional measures necessary for the protection of human, animal or plant health. For consignments en route between the Parties, the importing Party shall consider the most suitable and proportionate solution in order to avoid unnecessary disruptions to trade.
3. The Party adopting measures under paragraph 2 of this Article, shall inform the other Party no later than one working day following the date of the adoption of the measures. Upon request of either Party, and in accordance with the provisions of Article 59(3) of this Agreement, the Parties shall hold consultations regarding the situation within 15 working days of the notification. The Parties shall take due account of any information provided through such consultations and shall endeavour to avoid unnecessary disruption to trade, taking into account, where applicable, the outcome of the consultations provided for in Article 59(3) of this Agreement.
Article 65. Sanitary and Phytosanitary Sub-Committee
1. The SPS Sub-Committee is hereby established. It shall meet within three months after the date of entry into force of this Agreement, upon request of either Party thereafter, or at least once every year. If agreed by the Parties, a meeting of the SPS Sub-Committee may be held by video or audio-conference. The SPS Sub-Committee may also address issues out of session, by correspondence.
2. SPS Sub-Committee shall have the following functions:
(a) to consider any matter relating to this Chapter;
(b) to monitor the implementation of this Chapter and examine all matters which may arise in relation to its implementation;
(c) to review the Annexes IV to XII to this Agreement, notably in the light of progress made under the consultations and procedures provided for under this Chapter;
(d) to modify by means of an endorsement decision Annexes IV to XII to this Agreement in the light of the review provided for in point (c) of this paragraph, or as otherwise provided in this Chapter; and
(e) to give opinions and make recommendations to other bodies as defined in Title VIII (Institutional, General and Final Provisions) of this Agreement in light of the review provided for in point (c) of this paragraph.
3. The Parties agree to establish technical working groups, when appropriate, consisting of expert-level representatives of the Parties, which shall identify and address technical and scientific issues arising from the application of this Chapter.
When additional expertise is required, the Parties may establish ad hoc groups, including scientific and expert groups.
Membership of such ad hoc groups need not be restricted to representatives of the Parties.
4. SPS Sub-Committee shall regularly inform by means of a report the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, on its activities and decisions taken within competence.
5. The SPS Sub-Committee shall adopt its working procedures at its first meeting.
6. Any decision, recommendation, report or other action by the SPS Sub-Committee or any group established by the SPS Sub-Committee shall be adopted by consensus between the Parties.
Chapter 5. Customs and Trade Facilitation
Article 66. Objectives
1. The Parties acknowledge the importance of customs and trade facilitation matters in the evolving bilateral trade environment. The Parties agree to reinforce cooperation in this area with a view to ensuring that the relevant legislation and procedures, as well as the administrative capacity of the relevant administrations, fulfil the objectives of effective control and support facilitation of legitimate trade as a matter of principle.
2. The Parties recognise that utmost importance shall be given to public policy objectives including trade facilitation, security and prevention of fraud and a balanced approach to them.
Article 67. Legislation and Procedures
1. The Parties agree that their respective trade and customs legislation, as a matter of principle, shall be stable and comprehensive, as well as that the provisions and the procedures shall be proportionate, transparent, predictable, nondiscriminatory, impartial and applied uniformly and effectively and will, inter alia:
(a) protect and facilitate legitimate trade through effective enforcement of and compliance with legislative requirements;
(b) avoid unnecessary or discriminatory burdens on economic operators, prevent fraud and provide further facilitation for economic operators having a high level of compliance;
(c) apply a Single Administrative Document (SAD) for the purposes of customs declarations;
(d) lead to greater efficiency, transparency and simplification of customs procedures and practices at the border;
(e) apply modern customs techniques, including risk assessment, post clearance controls and company audit methods in order to simplify and facilitate the entry, exit and the release of goods;
(f) aim at reducing compliance costs and increasing predictability for all economic operators;
(g) without prejudice to the application of objective risk assessment criteria, ensure the non-discriminatory administration of requirements and procedures applicable to imports, exports and goods in transit;
(h) apply the international instruments applicable in the field of customs and trade including those developed by the World Customs Organisation (WCO), the Istanbul Convention on temporary admission of 1990, the International Convention on the Harmonised System of 1983, the WTO, the UN TIR Convention of 1975, the 1982 Convention on harmonisation of frontier controls of goods; and may take into account the WCO Framework of Standards to Secure and Facilitate Global Trade and European Commission guidelines such as the Customs Blueprints, where relevant;
(i) take the necessary measures to reflect and implement the provisions of the Revised Kyoto Convention on the Simplification and Harmonisation of Customs Procedures of 1973;
(j) provide for advance binding rulings on tariff classification and rules of origin. The Parties ensure that a ruling may be revoked or annulled only after notification to the affected operator and without retroactive effect, unless the rulings have been made on the basis of incorrect or incomplete information;
(k) introduce and apply simplified procedures for authorised traders according to objective and non-discriminatory criteria;
(l) set rules that ensure that any penalties imposed for breaches of customs regulations or procedural requirements be proportionate and non-discriminatory and, that their application, does not result in unwarranted and unjustified delays; and
(m) apply transparent, non-discriminatory and proportionate rules where government agencies provide services also provided by the private sector.
2. In order to improve working methods, as well as to ensure non-discrimination, transparency, efficiency, integrity and accountability of operations, the Parties shall:
(a) take further steps towards the reduction, the simplification and the standardisation of data and documentation required by customs and other relevant authorities;
(b) simplify requirements and formalities wherever possible, with respect to the rapid release and clearance of goods;
(c) provide effective, prompt and non-discriminatory procedures guaranteeing the right of appeal against customs and other relevant authorities' administrative actions, rulings and decisions affecting the goods submitted to customs. Such procedures for appeal shall be easily accessible and any costs shall be reasonable and commensurate with the costs incurred by the authorities to ensure the right of appeal;
(d) take steps to ensure that where a disputed administrative action, ruling or decision is the subject of an appeal, goods should normally be released and duty payments may be left pending, subject to any safeguard measures judged necessary. Where required, the release of the goods should be subject to the provision of a guarantee, such as a surety or a deposit; and
(e) ensure that the highest standards of integrity be maintained, in particular at the border, through the application of measures reflecting the principles of the relevant international conventions and instruments in this field, in particular the WCO Revised Arusha Declaration of 2003 and the European Commission Blueprint on Customs ethics of 2007, where appropriate.
3. The Parties agree to eliminate:
(a) any requirements for the mandatory use of customs brokers; and
(b) any requirements for the mandatory use of pre-shipment or destination inspections.
4. With regard to transit:
(a) for the purposes of this Agreement, the transit rules and definitions set out in the WTO provisions, in particular Article V of GATT 1994, and related provisions, including any clarifications and amendments resulting from the Doha Round negotiations on trade facilitation shall apply. Those provisions also apply when the transit of goods begins or ends in the territory of a Party;
(b) the Parties shall pursue the progressive interconnectivity of their respective customs transit systems, with a view to the future participation of Georgia in the common transit system (1);
(c) the Parties shall ensure cooperation and coordination between all relevant authorities in their territories to facilitate traffic in transit. Parties shall also promote cooperation between the authorities and the private sector in relation to transit.
Article 68. Relations with the Business Community
The Parties agree:
(a) to ensure that their respective legislation and procedures are transparent, publicly available, as far as possible through electronic means, and contain a justification for their adoption. There should be regular consultations and a reasonable time period between the publication of new or amended provisions and their entry into force;
(b) on the need for timely and regular consultations with trade representatives on legislative proposals and procedures related to customs and trade issues;
(c) to make publicly available relevant notices of administrative nature, including authority's requirements and entry or exit procedures, hours of operations and operating procedures for customs offices at ports and border crossing points, and points of contact for information enquiries;
(d) to foster cooperation between operators and relevant administrations, using non-arbitrary and publicly accessible procedures based, inter alia, on those promulgated by the WCO; and
(e) to ensure that their respective customs and customs-related requirements and procedures continue to meet the legitimate needs of the trading community, follow best practices, and remain the least trade-restrictive possible.
Article 69. Fees and Charges
1. The Parties shall prohibit administrative fees having an equivalent effect to import or export duties or charges.
2. With regard to all fees and charges of whatever character imposed by the customs authorities of each Party, including fees and charges for tasks undertaken on behalf of the said authorities, upon or in connection with import or export and without prejudice to the relevant provisions of Chapter 1 (National Treatment and Market Access for Goods) of Title IV (Trade and Trade-related Matters) of this Agreement:
(a) fees and charges may only be imposed for services provided at the request of the declarant outside normal working conditions, hours of operation and in places other than those referred to in the customs regulations, as well as for any formality related to such services and required for undertaking such import or export;
(b) fees and charges shall not exceed the cost of the service provided;
(c) fees and charges shall not be calculated on an ad valorem basis;
(d) the information on the fees and the charges shall be published via an officially designated medium, and where feasible and possible, an official website. This information shall include the reason for the fee or the charge for the service provided, the responsible authority, the fees and the charges that will be applied, and when and how payment is to be made; and
(e) new or amended fees and charges shall not be imposed until information on them is published and made readily available.
Article 70. Customs Valuation
1. The provisions of Agreement on the Implementation of Article VII of GATT 1994 contained in Annex 1A to the WTO Agreement, including any subsequent amendments, shall govern the customs valuation of goods in the trade between the Parties. Those provisions of the WTO Agreement are hereby incorporated into this Agreement and made part thereof. Minimum customs values shall not be used.
2. The Parties shall cooperate with a view to reaching a common approach to issues relating to customs valuation.
Article 71. Customs Cooperation
The Parties shall strengthen cooperation in the area of customs to ensure implementation of the objectives of this Chapter in order to further trade facilitation, while ensuring effective control, security and prevention of fraud. To that end the Parties may use, where appropriate, the European Commission Customs Blueprint as a benchmarking tool. In order to ensure compliance with the provisions of this Chapter the Parties shall, inter alia:
(a) exchange information concerning customs legislation and procedures;
(b) develop joint initiatives relating to import, export and transit procedures, as well as work towards ensuring that an effective service is provided to the business community;
(c) cooperate on the automation of customs and other trade procedures;
(d) exchange, where appropriate, information and data subject to respect of the confidentiality of sensitive data and the protection of personal data;
(e) cooperate in preventing and combating illicit cross-border traffic in goods, including in tobacco products;
(f) exchange information or enter into consultations with a view to establishing where possible, common positions in international organisations in the field of customs such as the WTO, the WCO, the UN, the United Nations Conference on Trade And Development (UNCTAD) and the UN-ECE;
(g) cooperate in the planning and delivery of technical assistance, notably to facilitate customs and trade facilitation reforms in accordance with the relevant provisions of this Agreement;
(h) exchange best practices in customs operations, in particular on risk based customs control systems and on intellectual property rights enforcement, especially in relation to counterfeited products;
(i) promote coordination between all border authorities of the Parties to facilitate border crossing process and enhance control, taking into account joint border controls, where feasible and appropriate; and
(j) establish, where relevant and appropriate, mutual recognition of trade partnership programmes and customs controls, including equivalent trade facilitation measures.
Article 72. Mutual Administrative Assistance In Customs Matters
Without prejudice to other forms of cooperation envisaged in this Agreement, in particular in Article 71 of this Agreement, the Parties shall provide mutual administrative assistance in customs matters in accordance with the provisions of Protocol II on Mutual Administrative Assistance in Customs Matters to this Agreement.
Article 73. Technical Assistance and Capacity Building
The Parties shall cooperate with a view to providing technical assistance and capacity building for the implementation of trade facilitation and customs reforms.
Article 74. Customs Sub-committee
1. The Customs Sub-Committee is hereby established. It shall report to the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.
2. The function of the Sub-Committee shall include regular consultations and monitoring of the implementation and the administration of this Chapter, including but not limited to the issues of customs cooperation, cross-border customs cooperation and management, technical assistance, rules of origin, trade facilitation, as well as mutual administrative assistance in customs matters.
3. The Customs Sub-Committee shall, inter alia:
(a) see to the proper functioning of this Chapter and of Protocols I and II to this Agreement;
(b) adopt practical arrangements, measures and decisions to implement this chapter and Protocols I and II to this Agreement, including on exchange of information and data, mutual recognition of customs controls and trade partnership programmes, and mutually agreed benefits;
(c) exchange views on any points of common interest, including future measures and the resources needed for their implementation and application;
(d) make recommendations where appropriate; and (e) adopt its internal rules of procedure.
Article 75. Approximation of Customs Legislation
Gradual approximation to the Union's customs law and certain international law shall be carried out as set out in Annex XIII to this Agreement.
Chapter 6. Establishment, Trade In Services and Electronic Commerce
Section 1. General Provisions
Article 76. Objective, Scope and Coverage
1. The Parties, reaffirming their respective commitments under the WTO Agreement hereby lay down the necessary arrangements for the progressive reciprocal liberalisation of establishment and trade in services and for cooperation on electronic commerce.
2. Public procurement is covered in Chapter 8 (Public procurement) of Title IV (Trade and Trade-related Matters) of this Agreement and nothing in this Chapter shall be construed to impose any obligation with respect to public procurement.
3. Subsidies are covered in Chapter 10 (Competition) of Title IV (Trade and Trade-related Matters) of this Agreement and the provisions of this Chapter shall not apply to subsidies granted by the Parties.
4. Consistent with the provisions of this Chapter, each Party retains the right to regulate and to introduce new regulations to meet legitimate policy objectives.
5. 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 citizenship, residence or employment on a permanent basis.
6. Nothing in this Chapter shall prevent a Party from applying measures to regulate the entry of natural persons into, or their temporary stay in, its territory, including those 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 any Party under the terms of a specific commitment in this Chapter and Annex XIV to this Agreement (1).
Article 77. Definitions
For the purposes of this Chapter:
(a) ‘measure' means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action or any other form;
(b) ‘measures adopted or maintained by a Party' means measures taken by:
(i) central, regional or local governments and authorities; and
(ii) non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities;
(c) ‘natural person of a Party' means a national of a Member State of the EU or a national of Georgia in accordance with the respective legislation;
(d) ‘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;
(e) ‘juridical person of a Party' means a juridical person as defined in point (d) and set up in accordance with the law of a Member State of the EU or of Georgia respectively, and having its registered office, central administration, or principal place of business in the territory (1) to which the Treaty on the Functioning of the European Union applies or in the territory of Georgia, respectively.
Should that juridical person have only its registered office or central administration in the territory to which the Treaty on the Functioning of the European Union applies or in the territory of Georgia respectively, it shall not be considered as a juridical person of the Union or a juridical person of Georgia respectively, unless its operations possess a real and continuous link with the economy of the Union or of Georgia, respectively;
Notwithstanding the preceding subparagraph, shipping companies established outside the Union or Georgia and controlled by nationals of a Member State of the EU or of Georgia, respectively, shall also be beneficiaries under this Agreement, if their vessels are registered in accordance with their respective legislation, in that Member State or in Georgia and fly the flag of a Member State or of Georgia;
(f) ‘subsidiary' of a juridical person of a Party means a juridical person which is owned or effectively controlled by that juridical person (2);
(g) ‘branch' of a juridical person means a place of business not having legal personality which has the appearance of permanency, such as the extension of a parent body, has a management structure and is materially equipped to negotiate business with third parties so that the latter, although knowing that there will, if necessary, be a legal link with the parent body, the head office of which is abroad, do not have to deal directly with such parent body but may transact business at the place of business constituting the extension;
(h) ‘establishment' means:
(i) as regards juridical persons of the Union or of Georgia, the right to take up and pursue economic activities by means of setting up, including the acquisition of, a juridical person and/or create a branch or a representative office in Georgia or in the Union respectively;
(ii) as regards natural persons, the right of natural persons of the Union or of Georgia to take up and pursue economic activities as self-employed persons, and to set up undertakings, in particular companies, which they effectively control.
(i) ‘economic activities' shall include activities of an industrial, commercial and professional character and activities of craftsmen and do not include activities performed in the exercise of governmental authority;
(j) ‘operations' shall mean the pursuit of economic activities;
(k) ‘services' includes any service in any sector except services supplied in the exercise of governmental authority;