(b) A comprehensive debt exchange or other similar process in which creditors that are not less than 75% of the capital of existing under such debt instrument have consented to such debt exchange or other similar process.
UNCITRAL Arbitration Rules means the Arbitration Rules of the United Nations International Law Commission on International Trade Law;
ICSID Additional Facility Rules means the Rules of the additional facility for the administration of proceedings by the secretariat of the International Centre for Settlement of Investment Disputes;
Secretary-General means the Secretary-General of ICSID; and
A tribunal means an arbitration tribunal established under article 11.19 or 11.25.
Annex 11-A. Customary International Law
The Parties confirm their common understanding that the "customary international law" referred to in Article 11.4 results from a general and consistent practice of States, followed by them in the sense of a legal obligation. The customary international law minimum standard of treatment of aliens refers to all principles of customary international law that protect the rights and economic interests of aliens.
Annex 11-B. Public Debt
1. The Parties recognize that the purchase of debt issued or incurred by a Party or its relevant institutions involves commercial risk. For greater certainty, no award may be made in favor of the claimant for a claim under Article 11.16.1(a)(i) or Article 11.16.1(b)(i) with respect to a default on debt issued or incurred by a Party or its relevant institutions, unless the claimant proves that such default constitutes an uncompensated expropriation for purposes of Article 11.10.1 or a breach of any other obligation in Section A.
2. No claim that a debt restructuring issued or entered into by a Party or its relevant institutions violates an obligation under Section A may be submitted to arbitration under Section B, or if already submitted, continued in arbitration, if the restructuring has been negotiated at the time of submission, or becomes a negotiated restructuring after such submission, except in the case of a claim that the negotiated restructuring violates Article 11.2 or 11.3.
3. Notwithstanding Article 11.16.4, and subject to paragraph 2 of this Annex, an investor of the other Party may not submit a claim to arbitration under Section B alleging that a debt restructuring issued or undertaken by a Party or its relevant institutions violates an obligation under Section A (other than Article 11.2 or 11.3) unless 270 days have elapsed since the events giving rise to the claim occurred.
Annex 11-C. Payments and Transfers
With respect to the obligations contained in Article 11.9, each Party, through the competent authority or authorities, reserves the right to maintain or adopt measures in accordance with its applicable legislation or other legal norms to ensure the stability of the currency and the normal operation of internal and external payments, granting it as powers for these purposes, the regulation of the amount of money and credit in circulation, the execution of credit operations and international exchanges, as well as the issuance of norms in monetary matters, credit, financial and international exchange.
Part of these measures, among others, is the establishment of requirements that restrict or limit current payments and transfers (capital movements) from or to each Party, as well as the operations that are related to them, such as establishing that the deposits, investments or credits that come from or are destined abroad are subject to the obligation to maintain a reserve. In applying the measures under this Annex, the Parties may not discriminate between the other Party and a non-Party with respect to operations of the same nature.
Annex 11-D. Expropriation
The Parties confirm their common understanding that:
1. an act or series of acts of a Party cannot constitute an expropriation unless it interferes with a tangible or intangible property right or with the essential attributes or powers of ownership of an investment.
2. Article 11.10.1 addresses two situations. The first is direct expropriation, where an investment is nationalized or otherwise directly expropriated through the formal transfer of title or right of ownership.
3. The second situation addressed by Article 11.10.1 is indirect expropriation, where an act or series of acts by a Party has an effect equivalent to a direct expropriation without the formal transfer of title or right of ownership.
(a) The determination of whether or not an act or series of acts of a Party, in a specific factual situation, constitutes an indirect expropriation requires a factual, case-by-case inquiry that considers among other factors:
(i) the economic impact of the governmental act, although the fact that an act or series of acts of a Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred;
(ii) the extent to which the government action interferes with unambiguous and reasonable expectations in the investment; and
(iii) the character of the government action.
(b) Except in exceptional circumstances, non-discriminatory regulatory acts of a Party that are designed and applied to protect legitimate public welfare objectives, such as public health, safety and the environment, do not constitute indirect expropriations.
Annex 11-E. Termination of the Bilateral Investment Treaty
Without prejudice to the provisions of paragraph 2, the Parties agree that the "Agreement between the Government of the Republic of Chile and the Government of the Republic of Peru for the Promotion and Reciprocal Protection of Investments" and its Protocol, hereinafter the "BIT", signed in Lima on February 2, 2002, shall terminate on the date of entry into force of this Agreement, as well as all rights and obligations arising from the BIT.
Any investment made in accordance with the provisions of the APPI, in a period prior to the entry into force of this Agreement, shall be governed by the rules of that agreement with respect to any act, fact or situation originated during the validity of the same. An investor may only submit a claim to arbitration in accordance with Article 8 of the BITPA, for acts, facts or situations arising during the term of that agreement, in accordance with the rules and procedures set forth in the BITPA and provided that no more than 3 years have elapsed from the date of entry into force of this Agreement.
Annex 11-F. Decree-Law 600 - Chile (18)
1. Decree Law 600 (1974), Foreign Investment Statute, is a voluntary and special investment regime for Chile.
2. As an alternative to the ordinary regime for the entry of capital into Chile, in order to invest in Chile, potential investors may apply to the Foreign Investment Committee to be subject to the regime established by Decree Law 600.
3. The obligations and commitments contained in this Chapter do not apply to Decree Law 600, Foreign Investment Statute and Law 18.657, Foreign Capital Investment Funds Law, to the continuation or prompt renewal of such laws and to the amendments thereto.
4. For greater certainty, the Chilean Foreign Investment Committee has the right to reject investment applications through Decree Law 600 and Law 18,657. In addition, the Chilean Foreign Investment Committee has the right to regulate the terms and conditions to which foreign investment made pursuant to Decree Law 600 and Law 18,657 will be subject.
5. Once an application for foreign investment submitted by an investor from Peru under Decree Law 600, its amendments, continuation or prompt renewal, has been accepted by the Foreign Investment Committee of Chile through the execution of a foreign investment contract, the disciplines set forth in Articles 11.2, 11.3 and 11.10 shall apply to the investment made under the respective contract.
6. Notwithstanding any other provision of this Agreement, Chile may prohibit an investor of Peru or a covered investment from transferring from Chile the proceeds from the sale of all or part, or from the total or partial liquidation of the investment made pursuant to an investment contract in accordance with Decree Law 600, for a period of up to 1 year from the time of the transfer and 5 years in the case of Law 18.657 counted in the same manner.
7. For greater certainty, nothing in this Annex shall be claimable under the provisions of Section B.
Annex 11-G. Possible Bilateral Appellate Body or Mechanism
For a period of 3 years from the date of entry into force of the Agreement, the Parties shall consider establishing an appellate body or similar mechanism to review awards rendered by Tribunals pursuant to Article 11.26, in arbitrations commenced after the establishment of the appellate body or similar mechanism.
Annex 11-H. Service of Documents on a Party Pursuant to Section B
Chile
The place of service of notices and other documents pursuant to Section B in Chile is pursuant to Section B, in Chile is:
Dirección de Asuntos Jurídicos
Ministry of Foreign Affairs of the Republic of Chile
Teatinos 180, 16th floor
Santiago, Chile
Peru
The place of service of notices and other documents pursuant to Section B, in Peru, is: Peru Section B, in Peru is:
Dirección General de Asuntos de Economía Internacional
Competition and Private Investment
Ministry of Economy and Finance of Peru
Jirón Lampa 277, 5th floor
Lima, Peru
Chapter 12. Cross-border Trade In Services
Article 12.1. Scope
1. This chapter applies to measures adopted or maintained by a Party affecting cross-border trade in services by service suppliers of the other party. Such measures include measures affecting:
(a) The production, distribution, sale and delivery of a service;
(b) The purchase or use of, or the payment by a service;
(c) Access to and use of distribution and transportation systems, or telecommunications networks and services in connection with the supply of a service;
(d) The presence in its territory of a service supplier of the other party; and
(e) The provision of a bond or other form of financial security as a condition for the provision of a service.
2. For the purposes of this chapter, measures adopted or maintained by a Party means measures adopted or maintained by:
(a) Governments and authorities of national, regional or local level; and
(b) Non-governmental bodies in the exercise of powers delegated by governments or authorities of national, regional or local level.
3. This chapter does not apply to:
(a) Measures adopted or maintained by a Party relating to financial services as defined in article 12.13;
(b) Air Services (1) including domestic and international air transportation scheduled and non-scheduled and related services in support of air services except:
(i) Maintenance and repair of aircraft services while the aircraft is outside service;
(ii) The selling and marketing of air transport services; and
(iii) Services computer reservation system (CRS)
(c) Public procurement; or
(d) Subsidies or grants provided by a party or a state enterprise, including loans and guarantees government-supported insurance, except as provided in article 12.2.
4. Articles 12.5, 12.8 and 12.9 shall apply to measures by a party affecting the supply of a service in its territory by a covered investment (2).
5. This chapter does not impose any obligation on a Party with respect to a national of the other party who wish to enter the labour market or who is permanently employed in its territory, or confer any right on that with respect to that national access or employment.
6. This chapter does not apply to services supplied in the exercise of governmental authority. 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.
Article 12.2. Subsidies
1. The Parties shall exchange information on all distorting subsidies or grants cross-border trade in services, such as loans, guarantees and insurance supported by the Government. The first exchange shall be made within a period of one year from the Entry into Force of this Agreement.
2. If the results of the negotiations related to Article xv.1 of GATS (or the results of any similar negotiations undertaken in other multilateral fora in which both parties participate) enter into force for those Parties, this article should be amended after consultation between them, so that they are incorporated into this Agreement. The Parties shall coordinate negotiations on such as appropriate.
Article 12.3. National Treatment
Each Party shall accord to service suppliers of the other party (3) treatment no less favourable than that accorded in like circumstances to service providers.
Article 12.4. Most Favoured Nation Treatment
Each Party shall accord to service suppliers of the other party (4) treatment no less favourable than that accorded to service providers in like circumstances of a non-party country.
Article 12.5. Non-discriminatory Quantitative Restrictions
No Party may, on the basis of a regional subdivision or on the entire territory, adopt or maintain measures that:
(a) Impose limitations on:
(i) The number of service suppliers (5), whether in the form of numerical quotas, monopolies and exclusive service suppliers or the requirement of an economic needs test;
(ii) The total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(iii) 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; (6)
(iv) 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 the supply of a specific service and directly related to it, in the form of numerical quotas or the requirement of an economic needs test; or
(b) Restrict or prescribe specific types of legal entity or joint venture through which a service supplier may supply a service.
Article 12.6. Local Presence
No party may require a service provider of the other party to establish or maintain a representative office or other form of undertaking, or who resides in its territory as a condition for the cross-border supply of a service.
Article 12.7. Dissenting Measures
1. Articles 12.3 and 12.4 and 12.5 and 12.6 do not apply to:
(a) Any Non-Conforming Measure existing Non-Conforming Measure that is maintained by:
(i) The Government or authorities of national or regional level of a Party as set out in annex I to its schedule;
(ii) A local government of a party;
(b) The continuation or prompt renewal of any Non-Conforming Measure referred to in subparagraph (a); or
(c) The modification of any Non-Conforming Measure referred to in subparagraph (a), provided that the amendment does not decrease the conformity of the measure as currently in force immediately before the amendment with Articles 12.3 and 12.4 and 12.5 and 12.6.
2. Articles 12.3 and 12.4 and 12.5 and 12.6 do not apply to any measure that adopts or maintains a Party with respect to the sectors or sub-sectors or activities as set out in annex II to its schedule.
3. The Parties shall meet within six months after the Entry into Force agreement to negotiate additional commitments in respect of quantitative restrictions on a non-discriminatory, mutually advantageous basis for the purpose of maintaining an overall balance of rights and obligations.
Article 12.8. Transparency In the Development and Implementation of Regulations (7)
1. Further to chapter 13 (transparency), each Party shall establish or maintain appropriate mechanisms to respond to inquiries from interested persons regarding its regulations relating to the subject matter of this chapter.
2. The implementation of the obligation to establish appropriate mechanisms for small administrative agencies, may require that shall take into account the budgetary constraints and resources.
Article 12.9. Domestic Regulation
1. Where a party requires authorization for the supply of a service, the competent authorities of that Party in a reasonable period of time after the submission of an application is considered complete under its laws and regulations, shall inform the applicant of the decision concerning the application. At the request of the applicant the competent authorities of the party without undue delay shall provide information concerning the status of the application. This obligation shall not apply to authorization requirements that are within the scope of Article 12.7.2
2. With a view to ensuring that measures relating to licensing requirements and procedures for licensing and qualification procedures do not constitute unnecessary barriers to trade in services, each Party shall endeavour to ensure that the measures it adopts or maintains:
(a) They are based on objective and transparent criteria, such as competition, the quality of the Service and the ability to supply the service;
(b) Not more burdensome than necessary to ensure the quality of the service; and
(c) Not in themselves a restriction on the supply of the service; in the case of licensing procedures.
3. With a view to ensuring that measures relating to technical standards do not constitute unnecessary barriers to trade in services, each Party shall seek to ensure, as appropriate for each specific sector, that the measures it adopts or maintains:
(a) They are based on objective and transparent criteria, such as competition, the quality of the Service and the ability to supply the service;
(b) Not more burdensome than necessary to ensure the quality of the service; and
(c) Not in themselves a restriction on the supply of the service; in the case of licensing procedures.
4. If the results of the negotiations related to GATS Article VI.4 of (or the results of any similar negotiations undertaken in other multilateral fora in which both parties participate) enter into force for those Parties, this article should be amended after consultation between them, so that they are incorporated into this Agreement. The parties agree on such negotiations to coordinate as appropriate.
Article 12.10. Mutual Recognition
1. For the purposes of the fulfilment in whole or in part of its standards or criteria for the licensing or service suppliers of certification or licensing and subject to the requirements of paragraph 4, a Party may recognize the education or experience obtained, requirements met or licenses or certifications granted in a particular country. Such recognition which may be achieved through harmonization or otherwise, may be based on an agreement or arrangement with the country concerned or may be accorded autonomously.
2. When a party, recognize autonomously or by agreement or arrangement, the education or experience obtained requirements met or licenses or certifications granted in the territory of a country that is not a party, nothing in Article 12.4 shall be construed to require the party to accord such recognition to the education or experience obtained, requirements met or licenses or certifications granted in the territory of the other party.
3. A Party that is a party to an agreement or arrangement of the type referred to in paragraph 1, existing or future, shall afford adequate opportunity to the other party, if the other party is concerned, to negotiate its accession to such an agreement or arrangement to negotiate or comparable agreements. Where a Party grants recognition autonomously, the other party will afford an adequate opportunity to demonstrate that the education or experience obtained licenses or certifications or requirements met in that other party territory should be recognized.
4. No party shall accord recognition in a manner which would constitute a means of discrimination between countries in the application of its standards or criteria for the licensing or certification or licensing of service suppliers, or a disguised restriction on trade in services.
5. Annex 12.10.5 applies to measures adopted or maintained by a Party relating to the licensing or certification of professional service suppliers as set out in the provisions of this annex.
6. The Parties shall meet within six months after the Entry into Force agreement to negotiate, on a mutually advantageous basis, a chapter on mutual recognition of diplomas and degrees.
Article 12.11. Implementation
The Parties shall consult annually, or otherwise agreed, to review the implementation of this Chapter other trade in services and consider issues of mutual interest. Among other matters, the Parties shall consult with a view to determining the feasibility of removing any requirement to maintain citizenship or permanent residence for the licensing or certification of service providers of each party. Such consultations shall also include the consideration of the development of procedures that could contribute to greater transparency of measures described in articles 12.7.1 (c) and 12.7.2.
Article 12.12. Denial of Benefits
Subject to article 16.4 (consultations), a Party may deny the benefits of this chapter to:
(a) Service suppliers of the other party if the service supplier is an enterprise owned or controlled by persons of a non- party and the enterprise has no substantial business activities in the territory of the other party; or
(b) Service suppliers of the other party if the service supplier is an enterprise owned or controlled by persons of denying the party and the enterprise has no substantial business activities in the territory of the other party.
Article 12.13. Definitions
For the purposes of this chapter:
Cross-border trade in services or cross-border supply of services supply the means of a serncio:
(a) The territory of a party into the territory of the other party (mode 1);
(b) In the territory of a party by a person of that party to a person of the other party (Mode 2); or
(c) By a national of a Party in the territory of the other party (mode 4);
But does not include the supply of a service in the territory of a party by a covered investment as defined in article 2.1 (definitions of general application) or by an investor of the other party;
Enterprise of a party constituted means an enterprise or organized under the law of a Party and a branch located in the territory of a party and carrying out business activities there;
Existing means in effect on the date of signature of this Agreement;
Service supplier of a Party means a person of a Party that seeks to supply a service or supplies (8);