Title
FREE TRADE AGREEMENT BETWEEN THE EFTA STATES AND THE KINGDOM OF THAILAND
Premable
PREAMBLE
Iceland, the Principality of Liechtenstein, the Kingdom of Norway and the Swiss Confederation (EFTA States),
and the Kingdom of Thailand (Thailand), hereinafter each individually referred to as a "Party" or collectively as the "Parties",
RECOGNISING the common wish to strengthen the links between the Parties by establishing close and lasting relations;
DESIRING to create favourable conditions for the development and diversification of trade between the Parties and for the promotion of commercial and economic cooperation in areas of common interest on the basis of equality, mutual benefit, non-discrimination and international law;
DETERMINED to promote and further strengthen the multilateral trading system, building on their respective rights and obligations under the Marrakesh Agreement establishing the World Trade Organization (WTO Agreement) and the other concluded agreements negotiated thereunder, thereby contributing to the harmonious development and expansion of world trade;
REAFFIRMING their commitment to democracy, the rule of law, human rights and fundamental freedoms in accordance with their obligations under international law, including as set out in the Charter of the United Nations and the Universal Declaration of Human Rights;
AIMING to create new employment opportunities, improve living standards, ensure high levels of public health, and protection of occupational safety and health and of the environment;
REAFFIRMING their commitment to pursue the objective of sustainable development and recognising the importance of coherent and mutually supportive trade, environmental and labour policies in this respect;
DETERMINED to implement this Agreement in line with the objectives to preserve and protect the environment through sound environmental management and to promote an optimal use of the worldâs resources in accordance with the objective of sustainable development;
RECALLING their rights and obligations under multilateral environmental agreements to which they are a party, and the respect for the fundamental principles and rights at work, including the principles set out in the relevant International Labour Organisation (ILO) Conventions to which they are a party;
RECOGNISING the importance of ensuring predictability for the trading communities of the Parties and of trade facilitation in promoting efficient and transparent procedures;
REAFFIRMING their commitment to promote inclusive economic growth by ensuring equal opportunities for all;
AFFIRMING their commitment to prevent and combat corruption in international trade and investment and to promote the principles of transparency and good public governance;
ACKNOWLEDGING the importance of good corporate governance and responsible business conduct for sustainable development, and affirming their aim to encourage enterprises to observe internationally recognised guidelines and principles in this respect, such as the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct, the OECD Principles of Corporate Governance, the UN Global Compact, and the UN Guiding Principles on Business and Human Rights;
CONVINCED that this Agreement will enhance the competitiveness of their firms in global markets and create conditions encouraging economic, trade, and investment relations between the Parties;
RECOGNISING the significant contributions of small and medium-sized enterprises, including micro-sized enterprises, to economic growth, employment, and innovation, and the desire to increase their ability to benefit from the opportunities arising from this Agreement;
DESIRING to encourage broader and deeper economic cooperation between the Parties;
HAVE AGREED, in pursuit of the above, to conclude the following Free Trade Agreement (Agreement):
Body
Chapter 1. GENERAL PROVISIONS
Article 1.1. Objectives
1. The Parties hereby establish a free trade area in accordance with the provisions of this Agreement, based on trade relations between market economies, with a view to spurring prosperity and sustainable development.
2. The objectives of this Agreement are:
(a) to achieve the liberalisation of trade in goods, in conformity with Article XXIV of the General Agreement on Tariffs and Trade 1994 (GATT 1994);
(b) to achieve the liberalisation of trade in services, in conformity with Article V of the General Agreement on Trade in Services (GATS);
(c) to mutually enhance investment opportunities;
(d) to prevent, eliminate or reduce unnecessary technical barriers to trade and unnecessary sanitary and phytosanitary measures;
(e) to promote competition in their economies, particularly as it relates to the economic relations between the Parties;
(f) to develop cooperation and facilitate participation in the government procurement markets of the Parties;
(g) to foster trade and economic cooperation in order to facilitate the implementation of the overall objectives of this Agreement;
(h) to ensure adequate and effective protection of intellectual property rights, in accordance with international standards;
(i) to develop international trade in such a way as to contribute to the objective of sustainable development and to ensure that this objective is integrated and reflected in the Parties' trade relations; and
(j) to contribute to the harmonious development and expansion of world trade.
Article 1.2. Geographical Scope
1. Except as otherwise specified in Annex I (Rules of Origin), this Agreement applies to:
(a) the land territory, internal waters, and the territorial sea of a Party, and the air-space above the territory of a Party, in accordance with international law; and
(b) the exclusive economic zone and the continental shelf of a Party, in accordance with international law.
2. This Agreement shall not apply to the Norwegian territory of Svalbard, with the exception of trade in goods.
Article 1.3. Trade and Economic Relations Governed by this Agreement
1. This Agreement applies to the trade and economic relations between, on the one side, the individual EFTA States and, on the other side, Thailand. This Agreement shall not apply to the economic relations between individual EFTA States, unless otherwise provided in this Agreement.
2. In accordance with the Customs Treaty of 29 March 1923 between Switzerland and Liechtenstein, Switzerland shall represent Liechtenstein in matters covered thereby.
Article 1.4. Relation to other International Agreements
1. The Parties confirm their rights and obligations under the WTO Agreement and the other concluded agreements negotiated thereunder to which they are a party, and any other international agreement to which they are a party.
2. Ifa Party considers that the maintenance or establishment of a customs union, free trade area, arrangement for frontier trade, or another preferential agreement by another Party has the effect of altering the trade regime provided for by this Agreement, it may request consultations. The Party concluding such agreement shall afford adequate opportunity for consultations with the requesting Party.
Article 1.5. Fulfilment of Obligations
1. Each Party shall take any general or specific measures required to fulfil its obligations under this Agreement.
2. Each Party shall ensure the observance of all obligations and commitments under this Agreement by its respective central, regional and local governments and authorities, and by non-governmental bodies in the exercise of governmental powers delegated to them by central, regional and local governments or authorities.
Article 1.6. Transparency and Confidential Information
1. Each Party shall publish, or otherwise make publicly available, their laws, regulations, judicial decisions, administrative rulings of general application as well as their respective international agreements, that may affect the operation of this Agreement.
2. Each Party shall, without undue delay, respond to specific questions and provide, upon request, information to the other Parties on matters referred to in paragraph 1.
3. Nothing in this Agreement shall require a Party to disclose confidential information, the disclosure of which would impede law enforcement, or otherwise be contrary to the public interest, or which would prejudice the legitimate commercial interests of any economic operator.
4. Where a Party provides information to another Party in accordance with this Agreement and designates the information as confidential, the Party receiving the information shall maintain the confidentiality of the information. Such information shall be used only for the purpose for which the information is provided and shall not be otherwise disclosed without the specific written permission of the Party providing the information.
5. In case of any inconsistency between this Article and provisions relating to transparency in other parts of this Agreement, the latter shall prevail to the extent of the inconsistency.
Chapter 2. TRADE IN GOODS
Article 2.1. Scope
This Chapter applies to trade in goods between the Parties.
Article 2.2. Customs Duties on Imports
1. Unless otherwise provided for in this Agreement, a Party shall apply customs duties on imports on goods originating in another Party in accordance with Annex I (Rules of Origin) and Annexes II to V (Schedules of Tariff Commitments on Goods).
2. Unless otherwise provided for in this Agreement, no Party shall introduce new customs duties on imports or increase customs duties on imports on goods originating in another Party covered by Annexes II to V (Schedules of Tariff Commitments on Goods).
3. For the purposes of this Agreement, "customs duties on imports" means any duties or charges imposed in connection with the importation of goods, except for:
(a) charges equivalent to an internal tax imposed in conformity with Article Il of the GATT 1994;
(b) duties imposed in conformity with Articles 2.13 (Subsidies and Countervailing Measures), 2.14 (Anti-Dumping), 2.15 (Global Safeguard Measures), 2.16 (Bilateral Safeguard Measures) of this Agreement or Article 5 of the WTO Agreement on Agriculture;
(c) fees or other charges imposed in conformity with Article VII of the GATT 1994. ARTICLE 2.3 Export Duties If a Party agrees with a non-Party to abolish export duties, it shall, upon request
by another Party, enter into consultation with the requesting Party with the objective to accord treatment no less favourable to the other Party.
Article 2.4. Rules of Origin and Administrative Cooperation
The rules of origin and administrative cooperation are set out in Annex I (Rules of Origin).
Article 2.5. Customs Valuation (1)
Article VII of the GATT 1994 and Part I of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.6. Classification of Goods and Transposition of Schedules
1. For the purposes of this Agreement, the classification of goods in trade between the Parties shall be governed by each Party's respective tariff nomenclature in conformity with the Harmonized Commodity Description and Coding System (HS). In Annexes II to V (Schedules of Tariff Commitments on Goods) and Appendix 1 (Product Specific Rules) to Annex I (Rules of Origin), the version of the HS and the year shall be indicated.
2. The transposition of the Schedules of tariff commitments and the Product Specific Rules (PSR) as a result of periodic amendments to the HS by the World Customs Organization (WCO) or other technical adjustments in the respective tariff nomenclature shall not impair or nullify commitments including dismantling periods listed in Annexes II to V (Schedules of Tariff Commitments on Goods), and Appendix 1 (Product Specific Rules) to Annex I (Rules of Origin).
3. Pursuant to paragraph 2, the PSR applicable to the corresponding goods under the amended HS by the WCO shall not impair, nullify or render more restrictive the PSR applicable to the original tariff line.
4. Each Party shall notify the other Parties promptly, preferably no later than six months after the entry into force of the transposition of its domestic customs tariff as a result of periodic amendments to the HS by the WCO by providing the transposed tariff commitments under this Agreement and respective HS correlation tables in English. The Parties shall publish the information on transposed tariff commitments under this Agreement. Such information shall, if possible, be in English.
5. On request of one or several Parties, the requested Party shall address any raised concern regarding the other Party's transposed tariff commitments under this Agreement within a reasonable period of time after receiving the request.
6. Parties shall enter into technical exchanges regarding updates of PSR following the periodic amendments to the HS by the WCO. The updates of the PSR accepted by the Parties shall be published by the Parties in English.
Article 2.7. Import Licensing
1. The WTO Agreement on Import Licensing Procedures applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
2. The Parties may only adopt or maintain licensing procedures as a condition for importation if other appropriate procedures to achieve an administrative purpose are not reasonably available.
3. No Party shall adopt or maintain import licensing procedures in order to implement a measure that is inconsistent with this Agreement, the GATT 1994 or the WTO Agreement on Trade-Related Investment Measures. A Party adopting non- automatic licensing procedures shall clearly indicate the measure implemented through such licensing procedures.
4. The Parties shall ensure that all automatic and non-automatic import licensing procedures are neutral in application, and administered in a fair, equitable, non- discriminatory, transparent, predictable and least trade-restrictive manner.
5. If a Party has denied an application for an import licence it shall, without undue delay, provide the applicant with a written explanation of the reasons for the denial.
6. Each Party shall provide effective, non-discriminatory and prompt and easily accessible procedures in accordance with its domestic laws and regulations to guarantee the right of appeal against administrative decisions on applications for import licences. Appeal procedures shall include administrative review by the supervising authority or judicial review in accordance with the domestic laws and regulations of each Party. If the denial of an import licence is upheld in an appeal, the Party granting the licence shall provide the applicant with a written justification without undue delay.
7. No application for an import licence shall be refused for minor documentation errors that do not alter the basic data contained therein. Minor documentation errors may include formatting errors, such as the width of a margin or the font used, and spelling errors which are obviously made without fraudulent intent or gross negligence.
8. A Party adopting or amending regulations related to import licensing that are likely to affect trade between the Parties shall promptly notify the other Parties, but no later than 60 days after publication. The notice shall clearly state the purpose of such licensing procedures and any conditions on eligibility for obtaining an import licence. A notification made by a Party in accordance with the WTO Agreement on Import Licensing Procedures shall be deemed equivalent to a notification under this Agreement.
Article 2.8. Quantitative Restrictions
1. Article XI of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
2. A Party introducing a measure in accordance with paragraph 2 of Article XI of the GATT 1994 shall promptly notify the Joint Committee. A notification by a Party in accordance with Article XI ofthe GATT 1994 shall be deemed equivalent to a notification under this Agreement.
3. Any measure applied in accordance with this Article shall be temporary, non- discriminatory, transparent and may not go beyond what is necessary to remedy
circumstances described in paragraph 2 of Article XI of the GATT 1994 and may not create unnecessary obstacles to trade between the Parties.
Article 2.9. Fees and Formalities
Article VII of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis, subject to Article 7 (Fees and Charges) of Annex VI (Trade Facilitation).
Article 2.10. National Treatment on Internal Taxation and Regulations
Article III of the GATT 1994 applies and is hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.11. Trade Facilitation
The provisions on trade facilitation are set out in Annex VI (Trade Facilitation).
Article 2.12. WTO Agreement on Agriculture
The Parties confirm their rights and obligations under the WTO Agreement on Agriculture unless otherwise specified in this Chapter.
Article 2.13. Subsidies and Countervailing Measures
1. The right and obligations of the Parties with respect to subsidies and countervailing measures shall be governed by Articles VI and XVI of the GATT 1994 and the WTO Agreement on Subsidies and Countervailing Measures, except as provided for in paragraph 2.
2. Before a Party initiates an investigation to determine the existence, degree and effect of any alleged subsidy in another Party, as provided for in Article 11 of the WTO Agreement on Subsidies and Countervailing Measures, the Party considering initiating an investigation shall notify in writing the Party whose products are subject to an investigation and allow for a 30-day period for consultations with a view to finding a mutually acceptable solution. Consultations shall take place in the Joint Committee, unless the Parties making and receiving the request for consultations agree otherwise. (2)
Article 2.14. Anti-dumping
1. The rights and obligations of the Parties with regard to anti-dumping measures shall be governed by Article VI of the GATT 1994 and the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (WTO Anti-dumping Agreement). The Parties shall endeavour to refrain from initiating anti-dumping procedures or applying anti-dumping measures against each other.
2. When a Party receives a properly documented application and before initiating an investigation concerning imports of another Party, the Party shall immediately notify in writing the other Party whose products are allegedly being dumped and allow for a 30- day period for consultations with a view to finding a mutually acceptable solution. Consultations shall take place in the Joint Committee, unless the Parties making and receiving the notifications agree otherwise. (3)
3. A definitive anti-dumping measure shall be terminated no later than five years from its imposition or from the most recent review, unless the authorities determine, in a review initiated pursuant to Article 11.3 of the WTO Anti-dumping Agreement and notified to the other Parties before that date, that the expiry of the measure would be likely to lead to continuation or recurrence of dumping and injury. The Party applying a definitive anti-dumping measure shall afford adequate opportunity for consultations on issues arising from the expiry review and avoid applying a perpetual measure.
4. No Party shall impose an anti-dumping measure with regard to the same product from the same Party within one year from the termination of an anti-dumping measure or a determination which resulted in the non-application or revocation of anti-dumping measures.
5. When anti-dumping margins are established, assessed, or reviewed under Articles 2, 9.3, 9.5, and 11 of the WTO Anti-dumping Agreement regardless of the comparison bases under Article 2.4.2 of the WTO Anti-dumping Agreement, all individual margins, whether positive or negative, shall be counted toward the average.
6. If a Party decides to apply an anti-dumping duty, the Party shall apply the âlesser dutyâ rule by determining a duty which is less than the dumping margin, when such lesser duty would be adequate to remove the injury to the domestic industry.
7. Five years after the entry into force of this Agreement, the Parties shall review the provisions of this Article in the Joint Committee.
Article 2.15. Global Safeguard Measures
1. The rights and obligations of the Parties with respect to global safeguards shall be governed by Article XIX of the GATT 1994 and the WTO Agreement on Safeguards. In taking measures under these WTO provisions, a Party shall, consistent with its obligations under the WTO Agreements, endeavour to exclude imports of an originating product from one or several Parties if such imports do not in and of themselves cause or threaten to cause serious injury.
2. A Party initiating an investigation to impose global safeguard measures shall immediately inform the Parties concerned and provide adequate opportunity for consultations.
3. No Party shall adopt definitive safeguard measures until 30 days after the offer for consultations was made.
4. A Party adopting global safeguard measures shall impose them in a way that least affects bilateral trade.
Article 2.16. Bilateral Safeguard Measures
1. Where, as a result of the reduction or elimination of a customs duty under this Agreement, any product originating in a Party is imported into the territory of another Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to constitute a substantial cause of serious injury or threat thereof to the domestic industry of like or directly competitive products in the territory of the importing Party, the importing Party may take bilateral safeguard measures to the minimum extent necessary to remedy or prevent the injury, subject to paragraphs 2 to 10.
2. Bilateral safeguard measures shall only be taken upon clear evidence that increased imports have caused or are threatening to cause serious injury pursuant to an investigation in accordance with the procedures laid down in the WTO Agreement on Safeguards.
3. The Party intending to take a bilateral safeguard measure pursuant to this Article shall immediately, and in any case before taking a measure, notify the other Parties. The notification shall contain all pertinent information, including evidence of serious injury or threat thereof caused by increased imports, a precise description of the product concerned, and the proposed measure, as well as the proposed date of introduction, expected duration and timetable for the progressive removal of the measure. A Party that may be affected by the bilateral safeguard measure shall be provided an opportunity to consult in order to mutually agree on appropriate trade liberalising compensation in the form of concessions having substantially equivalent trade effects as those resulting from the measure.
4. If the conditions set out in paragraph 1 are met, the importing Party may:
(a) suspend the further reduction of any rate of customs duty provided for under this agreement for the product; or
(b) increase the rate of customs duty for the product to a level not to exceed the lesser of:
(i) the most-favoured-nation (MFN) rate of duty applied at the time the bilateral safeguard measure is taken; or
(ii) the MFN rate of duty applied on the day immediately preceding the entry into force of this Agreement.
5. Bilateral safeguard measures shall be taken for a period not exceeding 18 months. In very exceptional circumstances, after review by the Joint Committee, measures may be taken up to a total maximum period of three years. No bilateral safeguard measures shall be applied to the import of a product, which has previously been subject to such a measure.
6. The Joint Committee shall, within 30 days from the receipt of the notification, examine the information provided under paragraph 3 in order to facilitate a mutually acceptable solution. In the absence of such solution, the importing Party may adopt a bilateral safeguard measure pursuant to paragraph 4 to remedy the problem, and, in the absence of mutually agreed compensation, the Party against whose product the bilateral safeguard measure is taken may take compensatory action. The bilateral safeguard measure and the compensatory action shall be immediately notified to the other Parties. In the selection of the bilateral safeguard measure and the compensatory action, priority must be given to the action or measure which least disturbs the functioning of this Agreement. The Party taking compensatory action shall apply the action only for the minimum period necessary to achieve the substantially equivalent trade effects and in any event, only while the bilateral safeguard measure under paragraph 4 is being applied.
7. Upon the termination of the bilateral safeguard measure, the rate of customs duty shall be the rate which would have been in effect but for the measure.
8. In critical circumstances, where delay would cause damage which would be difficult to repair, a Party may take a provisional bilateral safeguard measure pursuant to a preliminary determination that there is clear evidence that increased imports constitute a substantial cause of serious injury, or threat thereof, to the domestic industry. The Party intending to take such a measure shall immediately notify the other Parties thereof. Within 30 days from the receipt of the notification, the procedures set out in paragraphs 2 to 6, including for compensatory action, shall be initiated. Any compensation shall be based on the total period of application of the provisional bilateral safeguard measure and of the bilateral safeguard measure.
9. Any provisional bilateral safeguard measure shall be terminated within 200 days at the latest. The period of application of any such provisional bilateral safeguard measure shall be counted as part of the duration, and any extension thereof, of the bilateral safeguard measure, set out in paragraphs 4 and 5 respectively. Any tariff increases shall be promptly refunded if the investigation described in paragraph 2 does not result in a finding that the conditions of paragraph 1 are met.
10. 20 years after entry into force of this Agreement, the Parties shall review whether there is a need to maintain the possibility to take safeguard measures between them. Following the review, the Parties may decide whether they want to apply this Article any longer. If the Parties decide after the first review to maintain this possibility, biennial reviews shall thereafter be conducted by the Joint Committee.
Article 2.17. State Trading Enterprises
Article XVII of the GATT 1994 and the Understanding on the Interpretation of Article XVII of the General Agreement on Tariffs and Trade 1994 apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.18. General Exceptions
For the purposes of this Chapter, Chapter 3 (Technical Barriers to Trade), and Chapter 4 (Sanitary and Phytosanitary Measures), Article XX of the GATT 1994 and its interpretative notes apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.19. Security Exceptions
For the purposes of this Chapter, Chapter 3 (Technical Barriers to Trade), and Chapter 4 (Sanitary and Phytosanitary Measures), Article XXI of the GATT 1994 and its interpretative notes apply and are hereby incorporated into and made part of this Agreement, mutatis mutandis.
Article 2.20. Balance-of-Payments
1. A Party, in serious balance of payments difficulties, or under imminent threat thereof, may, in accordance with the conditions established under the GATT 1994 and the WTO Understanding on the Balance-of-Payments Provisions of the General Agreement on Tariffs and Trade 1994, adopt trade restrictive measures, which shall be of limited duration and non-discriminatory, and may not go beyond what is necessary to remedy the balance of payments situation.
2. The Party introducing a measure according to paragraph 1 shall promptly notify the other Parties.
Article 2.21. Preference Utilisation
1. For the purposes of monitoring the functioning of this Agreement and calculating preference utilisation rates, the Parties shall annually exchange import statistics and preferential tariff rates under this Agreement as well as applied MFN tariff rates.
2. Bilateral import statistics exchanged shall pertain to the three most recent calendar years available and comprise all imports from the Party concerned, including trade values and volumes listed at the level of national subheadings. Each Party shall exchange separate statistics for imports from the other Parties:
(a) benefiting from preferential treatment under this Agreement;
(b) benefiting from any other reduced tariff rates; and
(c) under MFN tariff rates.