|
|
[Home]
[Databases]
[WorldLII]
[Search]
[Feedback]
[Help]
India-Singapore Comprehensive Economic Cooperation Agreement |
[Database Search] [Name Search] [Help]
COMPREHENSIVE ECONOMIC COOPERATION AGREEMENT
BETWEEN THE REPUBLIC OF INDIA AND THE REPUBLIC OF SINGAPORE
PREAMBLE
The Republic of India and the Republic of Singapore (“the Parties”),
RECOGNISING their long-standing friendship, strong economic ties and close cultural links;
RECALLING the agreement reached at the meeting on 8th April 2002, in Singapore between their respective Prime Ministers to establish a Joint Study Group to examine the benefits of an India-Singapore Comprehensive Economic Cooperation Agreement
(“CECA”);
RECALLING the Declaration of Intent signed on 8th April 2003, in New Delhi by their respective Ministers in charge of commerce, trade and industry to conclude a CECA;
RECALLING the recommendations in the Joint Study Group Report which served as the framework for negotiations on the CECA and its structure as an integrated package of agreements;
CONSIDERING that the expansion of their domestic markets, through economic integration, is vital for accelerating their economic development;
DESIRING to promote mutually beneficial economic relations;
AIMING to enhance economic and social benefits, improve living standards and ensure high and steady growth in real incomes in their respective territories through the expansion of trade and investment flows;
BUILDING on their respective rights, obligations and undertakings as developing country members of the World Trade Organization, and under other multilateral, regional and bilateral agreements and arrangements;
REAFFIRMING their right to pursue economic philosophies suited to their development goals and their right to regulate activities to realise their national policy objectives;
RECOGNISING that economic and trade liberalisation should allow for the optimal use
of natural resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment;
CONSCIOUS that a Comprehensive Economic Co-operation Agreement would contribute to the promotion of closer links with other economies in the South East Asian region;
DESIRING to promote greater regional economic integration and believing that their cooperative framework could serve as a template for future integration with other countries in the South East Asian region;
Have agreed as follows:
2
CHAPTER 1
OBJECTIVES AND GENERAL DEFINITIONS
ARTICLE 1.1: GENERAL DEFINITIONS
(a) days means calendar days, including weekends and holidays;
(b) GATT 1994 means the General Agreement on Tariffs and Trade 1994;
(c) goods and products shall be understood to have the same meaning unless the context otherwise requires;
(d) (i) the term territory means, in respect of the Republic of Singapore, the territory of the Republic of Singapore as well as the territorial sea and any maritime area situated beyond the territorial sea which has been or might in the future be designated under its national law, in accordance with international law, as an area within which Singapore may exercise rights with regards to the sea, the sea-bed, the subsoil and the natural resources;
(ii) the term territory means, in respect of India, the territory of the Republic of India including its territorial waters and the airspace above it and other maritime zones including the Exclusive Economic Zone and continental shelf over which Republic of India has sovereignty, sovereign rights or exclusive jurisdiction in accordance with its laws in force, the 1982 United Nations Convention on the Law of the Sea and International Law;
(e) WTO means the World Trade Organization.
in the plural shall include the singular, unless otherwise indicated in the context.
ARTICLE 1.2: OBJECTIVES
The objectives of this Agreement are:
(a) to strengthen and enhance the economic, trade and investment cooperation between the Parties;
(b) to liberalise and promote trade in goods in accordance with Article XXIV
of the General Agreement on Trade and Tariffs;
3
(c) to liberalise and promote trade in services in accordance with Article V of the General Agreement on Trade in Services, including promotion of mutual recognition of professions;
(d) to establish a transparent, predictable and facilitative investment regime;
(e) to improve the efficiency and competitiveness of their manufacturing and services sectors and to expand trade and investment between the Parties, including joint exploitation of commercial and economic opportunities in non-Parties;
(f) to explore new areas of economic cooperation and develop appropriate measures for closer economic cooperation between the Parties;
(g) to facilitate and enhance regional economic cooperation and integration,
in particular, to form a bridge between India and the Association of Southeast Asian Nations (“ASEAN”) region and serve as a pathfinder for the India-ASEAN free trade agreement; and
(h) to build upon their commitments at the World Trade Organization.
4
CHAPTER 2
TRADE IN GOODS
ARTICLE 2.1: DEFINITIONS
For the purposes of this Chapter,
Anti-Dumping Agreement means Agreement on Implementation of Article VI of the
GATT 1994;
ATA Carnet Convention means the Customs Convention on the A.T.A. Carnet For The
Temporary Admission Of Goods;
ATA carnet has the same meaning as defined in the ATA Carnet Convention;
customs duties means duties2-1 imposed in connection with the importation of a good provided that such customs duties shall not include:
(a) charges equivalent to internal taxes, including excise duties and goods and services taxes imposed consistently with a Party’s WTO obligations;
(b) any anti-dumping or countervailing duty or safeguard measures applied consistently with provisions of the relevant WTO Agreements;
(c) fees or other charges that are limited in amount to the approximate cost of services rendered, and do not represent a direct or indirect protection for domestic goods or a taxation of imports for fiscal purposes;
domestic industry means the producers as a whole of the like or directly competitive product operating in the territory of a Party, or those whose collective output of the like
or directly competitive products constitutes a major proportion of the total domestic production of those products;
MFN means “most favoured nation” treatment in accordance with Article I of GATT
1994;
originating goods has the same meaning as defined in Chapter 3;
preferential treatment means any concession or privilege granted under this Agreement
by a Party;
products means all products including manufactures and commodities in their raw, semi processed and processed forms;
2-1 Customs duties for India refer to basic customs duties as included in the National Customs Schedules of
India.
5
serious injury means a significant overall impairment in the position of a domestic industry;
threat of serious injury means serious injury that, on the basis of facts and not merely
on allegation, conjecture or remote possibility, is clearly imminent.
ARTICLE 2.2: NATIONAL TREATMENT
Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of the GATT 1994, including its interpretative notes.
ARTICLE 2.3: REDUCTION AND/OR ELIMINATION OF CUSTOMS DUTIES
of the other Party in accordance with Annex 2A and Annex 2B and their respective headnotes.
ARTICLE 2.4: RULES OF ORIGIN
Products covered by the provisions of this Agreement shall be eligible for preferential treatment provided they satisfy the Rules of Origin as set out in Chapter 3.
ARTICLE 2.5: NON TARIFF MEASURES
of any goods of the other Party or on the exportation of any goods destined for the territory of the other Party except in accordance with its WTO rights and obligations or
in accordance with other provisions of this Agreement.
ARTICLE 2.6: CUSTOMS VALUE
Each Party shall determine the customs value of goods traded between them in accordance with the provisions of Article VII of the GATT 1994 and the WTO Agreement on Implementation of Article VII of the GATT 1994.
6
ARTICLE 2.7: ANTI-DUMPING
ARTICLE 2.7.1: NOTIFICATION OF PETITION FOR INVESTIGATION AND EXCHANGE OF
INFORMATION
the investigating Party. Such information, together with all relevant information on record, shall be taken into account by the investigating authority of the other Party in its findings.
ARTICLE 2.7.2: INCOMPLETE INFORMATION
Where the information provided by the exporter or producer under anti-dumping investigation may not be ideal in all respects and provided that the producer or exporter concerned has acted to the best of his ability, the investigating authority of a Party shall, before rejecting the information, use its best endeavours to obtain more complete information for the purposes of the investigation including, where requested, granting a reasonable extension of time to the producer or exporter concerned to make a more detailed and proper response in accordance with the provisions of the Anti-Dumping Agreement.
ARTICLE 2.7.3: USE OF INFORMATION
of the Anti-Dumping Agreement shall, subject to paragraph 2, be based on the value which appears in relevant documents, including the Certificate of Origin for the goods.
be constructed in accordance with Article 2.3 of the Anti-Dumping Agreement. In such instances, the investigating authority may rely on other sources of information, in accordance with its practice, to arrive at the export price.
2-2 This relates to the questionnaire referred to in Article 6 of the Anti-Dumping Agreement.
7
ARTICLE 2.7.4: RECOMMENDATIONS OF THE WTO COMMITTEE ON ANTI-DUMPING
PRACTICES
Each Party may, in all investigations conducted against goods from the other Party, take into account the recommendations by the WTO Committee on Anti-Dumping Practices.
ARTICLE 2.8: SUBSIDIES
The Parties reaffirm their commitment to abide by the provisions of the WTO Agreement on Subsidies and Countervailing Measures.
ARTICLE 2.9: SAFEGUARDS
ARTICLE 2.9.1: IMPOSITION OF A BILATERAL SAFEGUARD MEASURE
If as a result of the reduction or elimination of a customs duty2-3 under this
Agreement, an originating good of the other Party is being imported into the territory of
a Party in such increased quantities, in absolute terms, and under such conditions that the imports of such good from the other Party alone2-4 constitute a substantial cause of serious injury or threat of serious injury to domestic industry producing a like or directly competitive product such Party may:
(a) suspend the further reduction of any rate of customs duty on the good provided for under this Agreement; or
(b) increase the rate of customs duty on the good to a level not to exceed the lesser of
(i) The MFN applied rate of customs duty on the good in effect at the time the measure is taken; and
2-3 A determination that an originating good is being imported as a result of the reduction/ elimination of a customs duty provided for in this Agreement shall be made only if such reduction / elimination is a cause which contributes significantly to the increase in imports, but need not be equal to or greater than any other cause. The passage of a period of time between the commencement / termination of such
reduction/elimination and the increase in imports shall not by itself preclude the determination referred in
this footnote. If the increase in imports is demonstrably unrelated to such reduction / elimination, the determination referred in this footnote shall not be made.
2-4 For purposes of certainty, the Parties understand that a Party is not prevented from initiating a bilateral safeguard measure investigation in the event of a surge of imports from the territory of non-Parties. For further certainty, the Parties understand that bilateral safeguard measures can only be imposed on the other Party when the increase in the import of such goods from that other Party alone constitute a substantial cause of serious injury or threat of serious injury, to domestic industry producing a like or directly competitive product.
8
(ii) The MFN applied rate of customs duty on the good in effect on the day immediately preceding the date of the start of the period of investigation; or
(c) in the case of a customs duty applied to a good on a seasonal basis, increase the rate of customs duty to a level not to exceed the lesser of the MFN applied rate of customs duty that was in effect on the good for the corresponding season immediately preceding the date of the start of the period of investigation.
ARTICLE 2.9.2: CONDITIONS AND LIMITATIONS ON IMPOSITION OF A BILATERAL
SAFEGUARD MEASURE
The following conditions and limitations shall apply to an investigation or a measure described in Article 2.9.1:
(a) a Party shall immediately deliver written notice to the other Party upon:
(i) initiating an investigatory process relating to serious injury or threat thereof and the reasons for it;
(ii) making a finding of serious injury or threat thereof caused by increased imports; and
(iii) taking a decision to apply a safeguard measure;
(b) in making the notification referred to in paragraph (a), the Party proposing
to apply a safeguard measure shall provide the other Party with all pertinent information, which shall include evidence of serious injury or threat thereof caused by the increased imports, precise description of the good involved and the proposed measure, proposed date of introduction and expected duration; the Party proposing to apply a measure is also obliged to provide any additional information which the other Party considers pertinent;
(c) a Party proposing to apply a measure shall provide adequate opportunity for prior consultations with the other Party as far in advance of taking any such measure as practicable, with a view to reviewing the information arising from the investigation, exchanging views on the measure and reaching an agreement on compensation set out in Article 2.9.3. The Parties shall in such consultations, review, inter alia, the information provided under paragraph (b), to determine:
(i) compliance with Article 2.9;
(ii) whether any proposed measure should be taken; and
(iii) the appropriateness of the proposed measure, including consideration of alternative measures;
9
(d) a Party shall apply/take the measure only following an investigation by the competent authorities of such Party in accordance with Articles 3 and
4.2(c) of the WTO Agreement on Safeguards; and to this end, Articles 3 and 4.2(c) of the WTO Agreement on Safeguards are incorporated into and made a part of this Agreement, mutatis mutandis;
(e) in undertaking the investigation described in paragraph (d), a Party shall comply with the requirements of Article 4.2(a) and (b) of the WTO Agreement on Safeguards; and to this end, Article 4.2(a) and (b) are incorporated into and made a part of this Agreement, mutatis mutandis;
(f) the investigation shall be promptly terminated and no measure taken if imports of the subject good represent less than 2 per cent of market share
in terms of domestic sales2-5 or less than 3 per cent of total imports2-6;
(g) the investigation shall in all cases be completed within one year following its date of initiation;
(h) no measure shall be maintained:
(i) except to the extent and for such time as may be necessary to remedy serious injury and to facilitate adjustment; or
(ii) for a period exceeding two years, except that in exceptional circumstances, the period may be extended by up to an additional one year, to a total maximum of three years from the date of first imposition of the measure if the investigating authorities determine in conformity with procedures set out paragraphs (a) through (g), that the safeguard measure continues to be necessary
to prevent or remedy serious injury and to facilitate adjustment and that there is evidence that the industry is adjusting;
(i) no bilateral safeguard measure shall be taken against a particular good while a global safeguard measure in respect of that good is in place; in the event that a global safeguard measure is taken in respect of a particular good, any existing bilateral safeguard measure which is taken against that good shall be terminated;
(j) upon the termination of the safeguard measure, the rate of duty shall be the rate which would have been in effect but for the action;
2-5 Both Parties recognize that the terms “market share in terms of domestic sales” admits of more than one interpretation and agree that there could be different permissible methodologies for making a determination of the de minimis based on this parameter. Where the arbitral tribunal finds that the interpretation and methodology used for the determination of the domestic market share in a particular
investigation rests on one of those interpretations and permissible methodologies, it shall find the
determination to be in conformity with the Agreement.
2-6 The time frame to be used for calculating the applicable percentages shall be the 12 month period prior
to the filing of the petition.
10
(k) within 5 years after entry into force of this Agreement, the Parties shall meet to review this Article with a view to determining whether there is a need to maintain any bilateral safeguard mechanism; and
(l) if the Parties do not agree to remove the bilateral safeguard mechanism during the review pursuant to paragraph (k), they shall thereafter conduct reviews to determine the necessity of a bilateral safeguard mechanism, in conjunction with the review of the Agreement pursuant to Article 16.3.
ARTICLE 2.9.3: COMPENSATION
(a) up to two years; or
(b) up to three years, and the Party imposing the measure described in Article
2.9.1 provides to the other Party evidence that the industry concerned is adjusting during the period up to the end of the second year respectively.
ARTICLE 2.9.4: ADMINISTRATION OF EMERGENCY ACTION PROCEEDINGS
its laws, regulations, decisions and rulings governing all safeguard investigation action proceedings.
11
ARTICLE 2.9.5: GLOBAL SAFEGUARD MEASURES
Each Party retains its rights and obligations under Article XIX of GATT 1994 and the WTO Agreement on Safeguards. This Agreement does not confer any additional rights or impose any additional obligations on the Parties with regard to actions taken pursuant to Article XIX and the Agreement on Safeguards, except that a Party taking a safeguard measure under Article XIX and the Agreement on Safeguards may, to the extent consistent with the obligations under the WTO Agreements, exclude imports of an originating good from the other Party if such imports are not a substantial cause of serious injury or threat thereof.
ARTICLE 2.10: RESTRICTIONS TO SAFEGUARD BALANCE OF PAYMENTS
Article XII of the GATT 1994 and the Understanding on the Balance-of- Payments Provisions of the GATT 1994 shall be incorporated into and made a part of this Agreement, for measures taken for balance of payments purposes for trade in goods.
ARTICLE 2.11: MOST-FAVOURED NATION TREATMENT
ARTICLE 2.12: TARIFF CLASSIFICATION
For the purposes of this Chapter and Chapter 3, the basis for tariff classification would be the Harmonized Commodity Description and Coding System Nomenclature.
ARTICLE 2.13: GENERAL AND SECURITY EXCEPTIONS
12
necessary for the protection of its essential security interests with respect to a non-Party,
or goods of a non-Party that would be violated or circumvented if the benefits of this
Chapter were accorded to such goods.
ARTICLE 2.14: STATE TRADING ENTERPRISES
Nothing in this Agreement shall be construed to prevent a Party from maintaining
or establishing a state trading enterprise in accordance with Article XVII of the GATT
1994.
ARTICLE 2.15: TEMPORARY ADMISSION
(a) professional equipment necessary for representatives of the press or of broadcasting or television organizations for purposes of reporting or in order to transmit or record material for specified programs, cinematographic equipment2-7 necessary in order to make a specified film
or films or other professional equipment necessary for the exercise of the calling, trade or profession of a person to perform a specified task;
(b) goods intended for display or demonstration at an event; and
(c) goods intended for use in connection with the display of foreign products
at an event, including:
(i) goods necessary for the purpose of demonstrating foreign machinery or apparatus to be displayed,
(ii) construction and decoration material, including electrical fittings, for the temporary stands of foreign exhibitors,
(iii) advertising and demonstration material which is demonstrably publicity material for the foreign goods displayed, for example, sound recordings, films and lantern slides, as well as apparatus for use therewith; and
(iv) equipment including interpretation apparatus, sound recording apparatus and films of an educational, scientific or cultural character intended for use at international meetings, conferences
or congresses.
2-7 It would not include equipment which is to be used for internal transport or for the industrial manufacture or packaging of goods or (except in the case of hand-tools) for the exploitation of natural resources, for the construction, repair or maintenance of buildings or for earth moving and like projects.
13
(a) the goods in all respects conform to the description, quantity, quality, value and other specifications given in the ATA Carnet duly certified by the customs authorities at the country of exportation;
(b) the goods are capable of identification on re-exporting;
(c) the number or quantity of identical articles is reasonable having regard to the purpose of importation; and
(d) the goods shall be re-exported within three months from the date of importation or such other longer period in accordance with the domestic laws and practices of the Parties.
14
CHAPTER 3
RULES OF ORIGIN
SECTION A: DEFINITIONS
ARTICLE 3.1: DEFINITIONS
For the purposes of this Chapter:
carrier refers to any vehicle for air, sea, and land transport;
CIF price or CIF value refers to the price actually paid or payable to the exporter for the good when the good is loaded out of the carrier, at the port of importation. The price value includes the cost of the good, insurance and freight necessary to deliver the good to the named port of destination;
Customs Valuation Agreement means the WTO Agreement on Implementation of
Article VII of the General Agreement on Tariffs and Trade 1994;
FOB price or FOB value refers to the price actually paid or payable to the exporter for the good when the good is loaded onto the carrier at the named port of exportation. The value includes the cost of the good and all costs necessary to bring the good onto the carrier;
generally accepted accounting principles refers to the recognised consensus or substantial authoritative support in the territory of a Party at a particular time as to which economic resources and obligations should be recorded as assets and liabilities, which changes in assets and liabilities should be recorded, how the assets and liabilities and changes in them should be measured, what information should be disclosed and how it should be disclosed, and which financial statements should be prepared. These standards may be broad guidelines of general application as well as detailed practices, and procedures;
Harmonised System means the Harmonised Commodity Description and Coding
System;
identical and interchangeable materials means materials being of the same kind and commercial quality, possessing the same technical and physical characteristics, and which once they are incorporated into the finished product cannot be distinguished from one another for origin purposes by virtue of any markings etc;
indirect material means a good used in the production, testing or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including:
(a) fuel and energy;
15
(b) tools, dies, and moulds;
(c) parts and materials used in the maintenance of equipment and buildings;
(d) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment and buildings;
(e) gloves, glasses, footwear, clothing, safety equipment, and supplies;
(f) equipment, devices, and supplies used for testing or inspecting the goods;
(g) catalysts and solvents; and
any other goods that are not incorporated into the good but whose use in the production of the good can reasonably be demonstrated to be part of that production;
material means ingredients, raw materials, parts, components, subassemblies and goods that were physically incorporated into another good or were subject to a process in the production of another good;
non-originating material used in production means any material whose country of origin is other than the Parties (imported non-originating) and any material whose origin cannot be determined (undetermined origin);
originating material means a material that fulfils the criteria set out in either Article 3.3
or Article 3.4;
production means methods of obtaining goods including manufacturing, producing, assembling, processing, raising, growing, breeding, mining, extracting, harvesting, fishing, trapping, gathering, collecting, hunting and capturing.
SECTION B: ORIGIN DETERMINATION
ARTICLE 3.2: ORIGINATING GOODS
For purposes of this Agreement, products shall be deemed originating and eligible for preferential treatment if they are consigned according to Article 3.14 and conform to the origin requirement under any of the following conditions:
(a) Products wholly produced or obtained in the territory of the exporting
Party, in accordance with Article 3.3; or
(b) Products not wholly produced or obtained in the territory of the exporting
Party, provided that the said products are eligible under Article 3.4.
16
ARTICLE 3.3: WHOLLY OBTAINED OR PRODUCED
For the purposes of this Agreement, goods wholly obtained or produced in the territory of a Party shall be treated as originating goods of that Party. The following goods only shall be considered as being wholly obtained or produced in a Party:
(a) a raw or mineral good3-1/product extracted from its soil, waters, seabed,
or beneath the seabed;
(b) a vegetable good3-2 harvested or produced there;
(c) an animal born and raised there;
(d) a good obtained from animals referred to in (c) above;
(e) a good obtained from hunting, trapping, fishing or aquaculture conducted there;
(f) a good of sea fishing and other marine goods taken from outside its territory/territorial waters and Exclusive Economic Zone (EEZ) by vessels registered with a Party and flying its Flag;
(g) a good processed and/or made on board factory ships registered with a Party and flying its Flag exclusively from products referred to in paragraph (f) above;
(h) a good taken by a Party, or a person of a Party, from the sea bed or beneath the sea bed outside the territorial waters/sea of that Party, in accordance with the provisions of the United Nations Convention on the Law of the Sea;
(i) articles collected there which can no longer perform their original purpose nor are capable of being restored or repaired and are fit only for disposal
or recovery of parts or raw materials, or for recycling purposes3-3; and
(j) a good produced there exclusively from goods referred to in (a) through
(i), or from their derivatives, at any stage of production.
3-1 Includes mineral fuels, lubricants and related materials as well as mineral or metal ores.
3-2 Includes agricultural and forestry products.
3-3 This would cover all waste and scrap, including waste and scrap resulting from manufacturing or processing operations or consumption in the same Party, scrap machinery, discarded packaging and all products that can no longer perform the purposes for which they were produced and are fit only for disposal for the recovery of parts or raw materials. Such manufacturing or processing operations shall include all types of processing not only industrial or chemical but also mining, agriculture, construction, refining, incineration and sewage treatment operations.
17
ARTICLE 3.4: NOT WHOLLY OBTAINED OR PRODUCED
of Articles 3.6, 3.9 and that the final process of manufacturing is performed within the territory of the exporting Party, products would be considered as originating if:
(a) (i) the total value of the materials, parts or produce originating from countries other than the Parties or of undetermined origin used in the manufacture of the product does not exceed 60% of the FOB value of the product so produced or obtained; and,
(ii) the product so produced or obtained is classified in a heading, at the four digit level, of the Harmonised System different from those
in which all the non-originating materials used in its manufacture are classified; or
(b) the product satisfies the Product Specific Rules as specified in Annex 3B.
(a) Direct Method
Value of
Originating +
Direct
Labour +
Direct
Overhead
+ Profit
FOB Price x 100 % 40%
(b) Indirect Method
Value of Non-originating
materials3-4
FOB Price
x 100 % ≤ 60%
of paragraph 1, the non-qualifying value of the materials shall be that proportion which cannot be attributed to one or both of the Parties, provided that the requirements of Article 3.6 at each stage of value accumulation are satisfied.
ARTICLE 3.5: INDIRECT MATERIALS
In order to determine whether a product originates in the territory of a Party, any indirect material used to obtain such products shall be treated as originating whether such material originates in third countries or not, and its value shall be the cost registered in the accounting records of the producer of the good.
3-4 As defined in Article 3.1.
18
ARTICLE 3.6: INSUFFICIENT OPERATIONS
(a) operations to ensure the preservation of products in good condition during transport and storage (such as drying, freezing, keeping in brine, ventilation, spreading out, chilling, placing in salt, sulphur dioxide or other aqueous solutions, removal of damaged parts, and like operations);
(b) simple operations consisting of removal of dust, sifting or screening, sorting, classifying, matching (including the making-up of sets of articles), washing, painting, cutting;
(c) changes of packing and breaking up and assembly of consignments;
(d) simple cutting, slicing and repacking or placing in bottles, flasks, bags, boxes, fixing on cards or boards, and all other simple packing operations;
(e) affixing of marks, labels or other like distinguishing signs on products or their packaging;
(f) simple mixing of products whether or not of different kinds, where one or more components of the mixture do not meet the conditions laid down in this Chapter to enable them to be considered as originating products;
(g) simple assembly of parts of products to constitute a complete product;
(h) disassembly;
(i) slaughter of animals;
(j) mere dilution with water or another substance that does not materially alter the characteristics of the goods; and
(k) a combination of two or more operations referred to in paragraphs (a) to
(j).
ARTICLE 3.7: VALUE OF NON-ORIGINATING MATERIALS
The value of a non-originating material used in the production of a good shall be:
(a) For imported materials, parts or produce, the CIF value at the time of importation determined in accordance with the Agreement on Customs Valuation; and/or
19
(b) For materials, parts or produce of undetermined origin, the earliest price
as ascertained by the certifying authority to have been paid for in the territory of the Party where the working or processing takes place.
ARTICLE 3.8: DETERMINATION OF ORIGIN
No product shall be deemed to be a produce or manufacture of either Party unless the conditions specified in these rules are complied with in relation to such products, to the satisfaction of the authority issuing the certificate of origin.
ARTICLE 3.9: ACCUMULATION
as a material for the finished product shall be considered as a product originating in the territory of the latter Party provided that it:
(a) complies with the origin requirements provided for in Articles 3.3 or 3.4;
and
(b) fulfils the criteria in Article 3.6.
ARTICLE 3.10: ACCESSORIES, SPARE PARTS AND TOOLS
Each Party shall provide that accessories, spare parts and tools delivered with a good that form part of the good's standard accessories, spare parts and tools, shall be treated as originating goods if the good is an originating good, and shall be disregarded
in determining whether all the non-originating materials used in the production of the good undergo the applicable change in tariff classification, provided that:
(a) the accessories, spare parts and tools are not invoiced separately from the good;
(b) the quantities and value of the accessories, spare parts and tools are standard trade practice for the good in the domestic market of the exporting Party; and
(c) if the good is subject to a qualifying value content requirement, the value
of the accessories, spare parts, or tools shall be taken into account as originating or non-originating materials, as the case may be, in calculating the qualifying value content of the good.
ARTICLE 3.11: TREATMENT OF PACKING
(a) Packages and packing materials for retail sale:
20
(i) Packages and packing materials for retail sale, when classified
together with the packaged product, according to General Rule
5(b) of the Harmonised System, shall not be taken into account for considering whether all non-originating materials used in the manufacture of a product fulfil the criterion corresponding to a change of tariff classification of the said product.
(ii) If the product is subject to an ad valorem percentage criterion, the value of the packages and packing materials for retail sale shall be taken into account in its origin assessment, in case they are treated
as being one for customs purposes with the products in question.
(b) Containers and packing materials for transport:
The containers and packing materials exclusively used for the transport of
a product shall not be taken into account for determining the origin of any product, in accordance with General Rule 5(b) of the Harmonised System.
ARTICLE 3.12: IDENTICAL AND INTERCHANGEABLE MATERIALS
(a) permit a clear distinction to be made between originating and non originating materials including materials of undetermined origin acquired and/or kept in stock; and
(b) guarantee that no more products receive originating status than would be the case if the materials had been physically segregated.
At the request of the competent authorities of the exporting Party, the producer shall provide satisfactory information on how the stocks have been managed.
21
ARTICLE 3.13: ADVANCE RULINGS
as an originating good. The importing Party may request, at any time during the course
of evaluating the request for an advance ruling, additional information necessary to evaluate the request. The importing party shall issue its determination regarding the origin of the good within 120 days after receipt of all necessary information.
of the good for which the ruling was issued, for such period, which may be specified in the ruling.
(a) if the ruling was based on an error of fact;
(b) if there is a change in the material facts or circumstances on which the ruling was based; or
(c) to conform with a modification of this Chapter.
ARTICLE 3.14: CONSIGNMENT CRITERIA
The originating goods of the other Party shall be deemed to meet the consignment criteria when they are:
(a) transported directly from the territory of the other Party; or
(b) transported through the territory or territories of one or more non-Parties for the purpose of transit or temporary storing in warehouses in such territory or territories, and the products have not entered into trade or consumption there, provided that
22
(i) they do not undergo operations other than unloading, reloading or
operations to preserve them in good condition; or
(ii) the transit entry is justified for geographical reason or by considerations related exclusively to transport requirements.
SECTION C: DOCUMENTATION REQUIREMENTS
ARTICLE 3.15: CERTIFICATE OF ORIGIN
Products eligible for preferential concessions shall be supported by a Certificate
of Origin issued by a government authority designated by the government of the exporting Party and notified to the other Party (referred to herein as “the certifying authority”) in accordance with the Operational Certification Procedures, as set out in Annex 3B.
SECTION D : VERIFICATION OF ORIGIN
ARTICLE 3.16: CO-OPERATION ON VERIFICATION OF CERTIFICATES OF ORIGIN
Party.
ARTICLE 3.17: DENIAL OF PREFERENTIAL TARIFF TREATMENT
23
certifying authority, the Customs Authority in the importing country would take appropriate action to finalise the provisional assessment.
If no consent is given by the exporter or manufacturer concerned within a period of 45
days, the importing party may disallow the tariff preference for the particular Certificate
of Origin.
SECTION E : CONSULTATION AND MODIFICATIONS
ARTICLE 3.18: CONSULTATION AND MODIFICATIONS
These rules may be reviewed as and when necessary upon the request of either
Party and may be modified by mutual agreement pursuant to Article 16.7.
24
CHAPTER 4
CUSTOMS
ARTICLE 4.1: SCOPE
This Chapter shall apply, in accordance with the Parties’ respective national laws, rules and regulations, to customs procedures required for clearance of goods traded between the Parties.
ARTICLE 4.2: TRANSPARENCY
ARTICLE 4.3: RISK MANAGEMENT
|
1.
|
|
A Party shall adopt the risk management approach in its customs
activities based
|
|
on
|
its
|
identified risk of goods in order to facilitate the
clearance of low risk
|
consignments, while focusing its inspection activities on high-risk goods. Accordingly,
each Party undertakes that customs compliance activities at the time of entry shall not normally exceed 5 per cent of total customs transactions.
ARTICLE 4.4: PAPERLESS TRADING
25
ARTICLE 4.5: DENIAL OF PREFERENTIAL TARIFF TREATMENT
a provisional basis against a bond or a guarantee i.e. a legally binding undertaking as may be required. After examining the information so provided by the certifying authority, the Customs Authority in the importing country would take appropriate action
to finalise the provisional assessment.
no consent is given by the exporter or manufacturer concerned within a period of 45
days, the importing party may disallow the tariff preference for the particular Certificate
of Origin.
ARTICLE 4.6: VERIFICATION OF CERTIFICATES OF ORIGIN
26
Party.
ARTICLE 4.7: ADVANCE RULINGS
The Parties shall apply Advance Rulings in accordance with the provisions of
Article 3.13.
ARTICLE 4.8: SHARING OF BEST PRACTICES
ARTICLE 4.9: CONFIDENTIALITY
Nothing in this Chapter shall require a Party to provide or allow access to information:
(a) the disclosure of which would impede law enforcement or otherwise be contrary to the public interest; or
(b) the disclosure of which would prejudice the legitimate commercial interest of a particular enterprise, public or private.
27
CHAPTER 5
STANDARDS AND TECHNICAL REGULATIONS, SANITARY AND PHYTOSANITARY
MEASURES
ARTICLE 5.1: SCOPE
(hereinafter referred to as “regulatory barriers”) to the trade in goods between the Parties for products and/or assessments of manufacturers/manufacturing processes of products specified in the Sectoral Annexes to this Chapter.
(a) accepts the test reports of conformity assessment activities of the other Party to demonstrate conformity of products and/or manufacturers/manufacturing processes with its mandatory requirements when the conformity assessment activities are undertaken by conformity assessment bodies designated by the other Party in accordance with this Chapter i.e. mutual recognition of test reports;
(b) accepts the certification of results of conformity assessment activities of the other Party to demonstrate conformity of products and/or manufacturers/manufacturing processes with its mandatory requirements when the conformity assessment activities are undertaken by conformity assessment bodies designated by the other Party in accordance with this Chapter i.e. mutual recognition of certification of conformity assessment;
(c) accepts the mandatory requirements of a Party as producing outcomes equivalent to those produced by the other Party’s corresponding but different mandatory requirements, with both meeting the legitimate objective or achieving the appropriate level of sanitary or phytosanitary protection of the mandatory requirements applied in the territory of the latter Party; i.e. mutual recognition of equivalence of mandatory requirements.
ARTICLE 5.2: DEFINITIONS
28
Guide 2: 2004 "Standardization and related activities – General vocabulary” published by the ISO and IEC, unless the context otherwise requires and as appropriate.
accept means the use of the results of conformity assessment activities as a basis for regulatory actions such as approvals, licences, registrations and post-market assessments
of conformity assessment;
acceptance has an equivalent meaning to accept;
certification body means a body, including product or quality systems certification bodies, that may be designated by a Party in accordance with this Chapter to conduct certification on compliance with its or the other Party’s standardisation and/or specifications to meet relevant mandatory requirements;
confirmation means the confirmation of the compliance of the manufacturing or test facility with the criteria for confirmation by a Competent Authority of a Party pursuant
to the mandatory requirements of the other Party;
competent authority means an authority of a Party with the power to conduct inspection
or audits on facilities in its territory to confirm their compliance with the mandatory requirements of the other Party;
conformity assessment means any activity concerned with determining directly or indirectly whether products, manufacturers or processes fulfil relevant standards and/or specifications to meet relevant mandatory requirements set out in the respective Party’s mandatory requirements. The typical examples of conformity assessment activities are sampling, testing, inspection, evaluation, verification, certification, registration, accreditation and approval, as well as their combinations;
conformity assessment body means a body that conducts conformity assessment activities;
designation means the authorisation by a Party’s designating authority of its conformity assessment body to undertake specified conformity assessment activities pursuant to the mandatory requirements of the other Party;
designate has an equivalent meaning to designation;
Designating Authority means a body established in the territory of a Party with the authority to designate, monitor, suspend or withdraw designation of conformity assessment bodies to conduct conformity assessment activities within its jurisdiction in accordance with the other Party’s mandatory requirements;
inspection means conformity evaluation by observation and judgement accompanied as appropriate by measurement, testing or gauging, unless otherwise specified in the Sectoral Annex;
29
inspection body means a body that performs inspection;
registered conformity assessment body means a body registered pursuant to Article
5.5;
registration means the authorisation by a Party’s Designating Authority of a conformity assessment body of the other Party to undertake specified conformity assessment activities pursuant to its mandatory requirements;
regulatory authority means an entity that exercises a legal right to determine the mandatory requirements, control the import, use or supply of products within a Party’s territory and may take enforcement action to ensure that products marketed within its territory comply with that Party’s mandatory requirements including assessments of manufacturers/ manufacturing processes of products;
sanitary or phytosanitary measure shall have the same meaning as in the WTO Agreement on the Application of Sanitary and Phytosanitary Measures;
Sectoral Annex is an annex to this Chapter which specifies the implementation arrangements in respect of a specific product sector;
stipulated requirements means the criteria set out in a Sectoral Annex for the designation of a Conformity Assessment Body;
technical regulations shall have the same meaning as in the WTO Agreement on
Technical Barriers to Trade;
test facility means a facility, including independent laboratories, manufacturers’ own test facilities or government testing bodies, that may be designated by one Party’s Designating Authority in accordance with this Chapter to undertake tests to the other Party’s mandatory requirements; and
verification means an action to verify in the territories of the Parties, by such means as audits or inspections, compliance with the stipulated requirements for designation or criteria for confirmation by a conformity assessment body or a manufacturing or test facility respectively.
ARTICLE 5.3: GENERAL OBLIGATIONS
30
and marks of conformity, that are conducted by the registered conformity assessment bodies of the other Party.
(a) inter alia, provisions on scope and coverage;
(b) applicable laws, regulations and administrative provisions i.e. mandatory requirements of each Party concerning the scope and coverage;
(c) applicable laws, regulations and administrative provisions of each Party stipulating the requirements covered by this Chapter, all the conformity assessment activities covered by this Chapter to satisfy such requirements and the stipulated requirements for designation of conformity assessment bodies or the applicable laws, regulations and administrative provisions of each Party stipulating the criteria for confirmation of the manufacturing or test facilities covered by this Chapter; and
(d) the list of Designating Authorities or Competent Authorities.
of their respective mandatory requirements taking into account relevant international standards, recommendations and guidelines, in accordance with their international rights and obligations.
ARTICLE 5.4: APPLICATION
This Chapter applies to all products and/or assessments of manufacturers or manufacturing processes of products traded between the Parties, regardless of the origin
of those products, unless otherwise specified in a Sectoral Annex, or unless otherwise specified by any mandatory requirements of a Party.
ARTICLE 5.5: MUTUAL RECOGNITION OF CONFORMITY ASSESSMENT
Scope
Obligations
Trade, where technical regulations are required and relevant international standards exist
or their completion is imminent, Parties shall use them, or the relevant parts of them, as a basis for their mandatory requirements except when such international standards or relevant parts of them would be an ineffective or inappropriate means for the legitimate objectives pursued, for instance because of fundamental climatic or geographical factors
or fundamental technological problems.
31
activities to demonstrate conformity of products with its mandatory requirements when the conformity assessment activities are undertaken by conformity assessment bodies designated by the Designating Authority of the other Party and registered by the first mentioned Party’s Designating Authority in accordance with this Chapter.
Designating Authorities
Designating Authorities, and ensure that their Designating Authorities:
(a) have the necessary power to designate, monitor (including verification), withdraw the designation of, suspend the designation of and withdraw the suspension of the designation of the conformity assessment bodies that conduct conformity assessment activities within its territory based upon the requirements set out in the other Party’s mandatory requirements as specified in the relevant Sectoral Annex; and
(b) consult, as necessary, with the relevant counterparts of the other Party to ensure the maintenance of confidence in conformity assessment activities including processes and procedures. The consultations may include joint participation in audits related to conformity assessment activities or other assessments of registered conformity assessment bodies, where such participation is appropriate, technically possible and within reasonable cost.
Registration of Conformity Assessment Bodies
(a) each Party shall make a proposal that a conformity assessment body of that Party designated by its Designating Authority be registered under this Chapter, by presenting its proposal in writing, supported by the necessary documents, to the Designating Authority of the other Party;
(b) the Designating Authority of the other Party shall consider whether the proposed conformity assessment body complies with the stipulated and mandatory requirements specified in the relevant Sectoral Annex and communicate, to the Designating Authority of the other Party in writing, its decision regarding the registration of that conformity assessment body along with date of registration within 90 days from the date of receipt of
the proposal referred to in paragraph (a) above; and
(c) in the event of any disagreement over the registration, either Party may refer the matter to the Mutual Recognition Joint Committee for resolution.
32
(a) the name and address of the conformity assessment body;
(b) the products or processes the conformity assessment body is designated to assess;
(c) the conformity assessment activities the conformity assessment body is designated to conduct; and
(d) the designation procedure and necessary information used to determine the compliance of the conformity assessment body with the stipulated requirements.
of a conformity assessment body registered by the Designating Authority of the other Party when its Designating Authority considers that the conformity assessment body no longer complies with the stipulated and mandatory requirements set out in the relevant Sectoral Annex. The withdrawal of the designation shall be notified in writing to the Designating Authority of the other Party. Each Party shall terminate the registration of a conformity assessment body when the Designating Authority of the other Party withdraws the designation of its conformity assessment body. The date of termination of registration of the conformity assessment body shall be the date of receipt of notification for withdrawal from the other Party.
in the relevant Sectoral Annex. Proposal for terminating the registration of that conformity assessment body shall be made to the Designating Authority of the other Party in writing.
Verification and Monitoring of Conformity Assessment Bodies
33
(a) through appropriate means such as audits, inspections or monitoring, ensure that its designated conformity assessment bodies fulfil the stipulated and mandatory requirements set out in the Sectoral Annex. When applying the stipulated requirements for designation of the conformity assessment bodies, the Designating Authorities of a Party should take into account the bodies’ understanding of and experience relevant to the mandatory requirements of the other Party;
(b) monitor and verify that the designated conformity assessment bodies, maintain the necessary technical competence to demonstrate the conformity of a product with the standards, and/or specifications to meet the mandatory requirements of the other Party. This shall include participation in appropriate proficiency-testing programmes and other comparative reviews such as non government-to-government mutual recognition agreements, so that confidence in their technical competence
to undertake the required conformity assessment is maintained;
(c) exchange information concerning the procedures used to ensure that the designated conformity assessment bodies are technically competent and comply with the relevant stipulated requirements; and
(d) compare methods used to verify that the registered conformity assessment bodies comply with the relevant stipulated requirements.
a registered conformity assessment body complies with the stipulated requirements for designation as set out in the mandatory requirements in the Sectoral Annex, and may request for a verification to be conducted of the conformity assessment body’s activities
in accordance with the first mentioned Party’s mandatory requirements.
Suspension and Withdrawal of Suspension of Designation of Conformity
Assessment Bodies
34
Challenge
be suspended immediately. The date of suspension shall be the date of receipt of the written notification pursuant to paragraph 18.
(a) the challenging Party is satisfied as to the competence and compliance of the conformity assessment body; or
(b) the designation of that conformity assessment body has been withdrawn;
or
(c) the Mutual Recognition Joint Committee decides to lift the suspension of the registration of the conformity assessment body.
35
activated. Where the Mutual Recognition Joint Committee decides to conduct a joint verification, it will be conducted in a timely manner by the Parties with the participation
of the Designating Authority that designated the contested conformity assessment body and with the prior consent of the conformity assessment body. The result of such joint verification shall be discussed in the Mutual Recognition Joint Committee with a view to resolving the issue within the time limit specified in the Sectoral Annex.
ARTICLE 5.6: GOOD MANUFACTURING PRACTICES (GMP)
Obligations
Trade, where technical regulations are required and relevant international standards exist
or their completion is imminent, the Parties shall use them, or the relevant parts of them,
as a basis for their mandatory requirements except when such international standards or relevant parts of them would be an ineffective or inappropriate means for the legitimate objectives pursued, for instance because of fundamental climatic or geographical factors
or fundamental technological problems.
ARTICLE 5.7: EQUIVALENCE OF MANDATORY REQUIREMENTS
36
(a) the procedures for determining and implementing the equivalence of each
Party’s mandatory requirements; and/or
(b) the procedures for accepting the results of the conformity assessment and approval procedures; and
(c) the regulatory authorities designated by each Party. ARTICLE 5.8: JOINT COMMITTEE ON MUTUAL RECOGNITION
Committee”) shall be established as a body responsible for the effective implementation
of this Chapter.
(a) may be accompanied by advisers at meetings of the Mutual Recognition
Joint Committee; and
(b) shall not hold a position which may give rise to a conflict of interest.
(a) be responsible for administering and facilitating the effective functioning
of this Chapter and the Sectoral Annexes including:
(i) facilitating the extension of this Chapter, including the addition of new Sectoral Annexes or an increase in the scope of existing Sectoral Annexes;
(ii) resolving any questions or disputes relating to the application of this Chapter and its Sectoral Annexes;
(iii) resolving disagreement over registration with reference to paragraph 5(c) of Article 5.5, lifting of suspension of registration
of a conformity assessment body with reference to paragraphs
22(c) and 23 of Article 5.5;
(iv) establishing appropriate modalities of information exchange referred to in this Chapter;
(v) appointing experts from each Party for joint verification when needed; and
(vi) discharging such other functions as provided for in this Chapter;
37
(b) be the contact point for the Parties unless otherwise specified in the relevant Sectoral Annexes;
(c) determine its own rules of procedure;
(d) make its decisions and adopt its recommendations by consensus; and
(e) meet as and when required for the discharge of its functions, including upon the request of either Party.
is not resolved through mutual consultations, the Parties shall seek an amicable solution through the Mutual Recognition Joint Committee.
ARTICLE 5.9 : EXCHANGE OF INFORMATION AND COOPERATION
(a) broaden the exchange of information; and
(b) give favourable consideration to any written request for consultation.
co-operation activities in the areas of technical issues of mutual interest.
38
ARTICLE 5.10: CONFIDENTIALITY
of any proprietary information disclosed to it in connection with conformity assessment activities and/or designation activities.
(a) be contrary to its essential security interests;
(b) be contrary to the public interest as determined by its domestic laws, regulations and administrative provisions;
(c) be contrary to any of its domestic laws, regulations and administrative provisions including but not limited to those protecting personal privacy
or the financial affairs and accounts of individual customers of financial institutions;
(d) impede law enforcement; or
(e) prejudice legitimate commercial interests of particular public or private enterprises.
ARTICLE 5.11: PRESERVATION OF REGULATORY AUTHORITY
(a) prevent a Party from adopting or maintaining, in accordance with its international rights and obligations, mandatory requirements, as appropriate to its particular national circumstances;
(b) prevent a Party from adopting mandatory requirements to determine the level of protection it considers necessary to ensure the quality of its imports, or for the protection of human, animal or plant life or health, or the environment, or for the prevention of deceptive practices or to fulfil other legitimate objectives, at the levels it considers appropriate.
(c) limit the authority of a Party to take all appropriate measures whenever it ascertains that products may not conform with its mandatory requirements. Such measures may include withdrawing the products from
39
the market, prohibiting their placement on the market, restricting their free movement, initiating a product recall, initiating legal proceedings or otherwise preventing the recurrence of such problems including through a prohibition on imports. If a Party takes such measures, it shall notify the other Party within 15 days of taking the measures, giving its reasons;
(d) oblige a Party to accept the standards or technical regulations or mandatory requirements of the other Party;
(e) entail an obligation upon a Party to accept the results of the conformity assessment activities and/or assessment of manufacturers or manufacturing processes of products and their mandatory requirements of any third country save where there is an expressed agreement between the Parties to do so; or
(f) be construed so as to affect the rights and obligations of either Party as a member of the WTO Agreement on Technical Barriers to Trade or WTO Agreement on the Application of Sanitary and Phytosanitary Measures.
ARTICLE 5.12: FINAL PROVISIONS ON SECTORAL ANNEXES
(a) specify and communicate to each other the applicable articles or annexes contained in the mandatory requirements set out in the Sectoral Annexes;
(b) exchange information concerning the implementation of the mandatory requirements specified in the Sectoral Annexes;
(c) notify each other of any scheduled changes in their respective mandatory requirements as and when they are made; and
(d) notify each other of any scheduled changes concerning their respective Designating Authorities as well as registered conformity assessment bodies.
2 shall enter into force on the first day of the second month following the date on which the Parties have exchanged notes confirming the completion of their respective procedures for the entry into force of that Sectoral Annex.
40
41
CHAPTER 6
INVESTMENT
ARTICLE 6.1: DEFINITIONS
For the purposes of this Chapter:
(a) movable and immovable property and other property rights such as mortgage, liens or pledges;
(b) shares, stocks, debentures and similar interests in companies;
(c) rights to money or to any performance under contract having a financial value;
(d) intellectual property rights
(e) goodwill, technical processes and know-how as conferred by law or under contract;
(f) business concessions conferred by law or under contract, including concessions to search for, extract or exploit oil and other minerals and other natural resources.
(a) an enterprise of a Party; or
(b) a national of a Party
that has made or is in the process of making or is seeking to make an investment;
42
(a) central, regional, or local governments and authorities; and
(b) non-governmental bodies in the exercise of powers delegated by central, regional, or local governments or authorities;
ARTICLE 6.2: SCOPE OF APPLICATION
ARTICLE 6.3: NATIONAL TREATMENT
6-1 The provisions of this Chapter, except for the provisions in paragraph 1 of Article 6.3 would be extended to branches of enterprises incorporated under the laws of a non-party, that are registered or set up in the territory of either Party, that are specifically permitted
in other Chapters of the Agreement.
43
investments in the sectors listed at Annex 6A and Annex 6B, treatment no less than that
it accords in like circumstances to its own investors and investments. Any subsequent establishment, acquisition or expansion of investments by an enterprise that is incorporated, constituted, set up or otherwise duly organized under the law of a Party, and which is owned by an investor of the other Party, shall be regarded as an investment
of the other Party, for the purpose of determining the applicable treatment to be accorded under this paragraph6-2.
ARTICLE 6.4: COMPENSATION FOR LOSSES
Investors of one Party whose investments in the territory of the other Party suffer losses owing to war or other armed conflict, a state of emergency or civil disturbances in the territory of the latter Party, shall be accorded by that Party treatment, as regards restitution, indemnification, compensation or other settlement, if any, no less favourable than that which that Party accords to its own investors or to investors of any non-Party. Any payments under this Article shall be freely transferable.
ARTICLE 6.5: EXPROPRIATION
of investors of the other Party unless the measures are taken on a non-discriminatory basis, for a purpose authorized by law, in accordance with due process of law and against payment of compensation in accordance with this Article.
6-2 The Parties understand that such enterprises shall be entitled to be accorded any better treatment which
is available under the regime of that Party, at the time of such subsequent establishment, acquisition and expansion of investments. Any such better treatment accorded shall not be construed as an automatic addition to the commitments scheduled in the Parties' respective Schedules of Specific Commitments in Annex 6A and Annex 6B.
6-3 The term “expropriation” includes “nationalisation”.
44
of the other Party own shares, it shall ensure that the provisions of paragraph 1 and 2 are applied to the extent necessary to guarantee compensation as specified therein to such investors of the other Party who are owners of those shares.
ARTICLE 6.6: REPATRIATION
(a) profits, capital gains, dividends, royalties, licence fees, interest and other current income;
(b) the proceeds of the total or partial liquidation of an investment;
45
(c) repayments made pursuant to a loan agreement in connection with an investment;
(d) payments in respect of technical assistance, technical service and management fees;
(e) payments in connection with contracting projects;
(f) earnings of nationals of the other Party who work in connection with an investment in the territory of the former Party; and
(g) payments of compensation under Articles 6.4 and 6.5.
(a) bankruptcy, insolvency or the protection of the rights of creditors;
(b) issuing, trading or dealing in securities, futures, options, or derivatives;
(c) criminal or penal offences, and the recovery of proceeds of crime;
(d) ensuring the satisfaction of judgments, orders or awards in adjudicatory proceedings such as judicial and quasi-judicial proceedings; or
(e) social security, public retirement or statutory savings schemes, including provident funds, retirement gratuity programmes and employees insurance programmes.
ARTICLE 6.7: RESTRICTIONS TO SAFEGUARD THE BALANCE OF PAYMENTS
to investments. It is recognized that particular pressures on the balance of payments of a Party in the process of economic development may necessitate the use of restrictions to ensure, inter alia, the maintenance of a level of financial reserves adequate for the implementation of its programme of economic development.
(a) be consistent with the Articles of Agreement of the International
Monetary Fund;
(b) avoid unnecessary damage to the commercial, economic and financial interests of the other Party;
(c) not exceed those necessary to deal with the circumstances described in paragraph 1;
46
(d) be temporary and be phased out progressively as the situation specified in
paragraph 1 improves; and
(e) be applied on a national treatment basis and such that the other Party is treated no less favourably than any non-Party.
ARTICLE 6.8: SUBROGATION
(or any agency, institution, statutory body or corporation designated by it) is entitled by virtue of subrogation to exercise the rights and assert the claims of its own investors. The subrogated rights or claims shall not be greater than the original rights or claims of the said investor.
ARTICLE 6.9: DENIAL OF BENEFITS
of the other Party where the denying Party establishes that:
(a) the enterprise has no substantial business operations in the territory of the other Party; or
(b) investors of the denying Party own or control the enterprise.
ARTICLE 6.10: MEASURES IN THE PUBLIC INTEREST
Nothing in this Chapter shall be construed to prevent:
(a) a Party or its regulatory bodies from adopting, maintaining or enforcing any measure, on a non-discriminatory basis; or
(b) the judicial bodies of a Party from taking any measures;
47
consistent with this Chapter that is in the public interest, including measures to meet health, safety or environmental concerns.
ARTICLE 6.11: GENERAL EXCEPTIONS
(a) necessary to protect public morals or to maintain public order;
|
(b)
|
necessary to protect human, animal or plant life or
health;
|
|
|
(c)
|
necessary to secure compliance with laws or regulations which
|
are not
|
inconsistent with the provisions of this Chapter including those relating
to:
(i) the prevention of deceptive and fraudulent practices to deal with the effects of a default on a contract;
(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection
of confidentiality of individual records and accounts;
(iii) safety;
(d) imposed for the protection of national treasures of artistic, historic or archaeological value;
(e) relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption.
ARTICLE 6.12: SECURITY EXCEPTIONS
(a) to require a Party to furnish any information, the disclosure of which it considers contrary to its essential security interests; or
(b) to prevent a Party from taking any action which it considers necessary for the protection of its essential security interests
(i) relating to fissionable and fusionable materials or the materials from which they are derived;
48
(ii) in time of war or other emergency in international relations;
(iii) relating to the production or supply of arms and ammunition; or
(iv) to protect critical public infrastructures, including communication, power and water infrastructures, from deliberate attempts intended
to disable or degrade such infrastructures; or
(c) to prevent a Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
or an investor of a non-Party that would be violated or circumvented if the benefits of this Chapter were accorded to such an enterprise or to its investments.
ARTICLE 6.13: DISCLOSURE OF INFORMATION
Nothing in this Chapter shall require any Party to provide confidential information, the disclosure of which would impede law enforcement or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests
of public or private enterprises.
ARTICLE 6.14: SPECIAL FORMALITIES AND INFORMATION REQUIREMENTS
Party or its investment, routine business information, to be used solely for informational
or statistical purposes, concerning that investment in its territory. The Party shall protect such business information as is confidential from disclosure that would prejudice the investor's or the investment's competitive position. Nothing in this paragraph shall
49
preclude a Party from otherwise obtaining or disclosing information in connection with the equitable and good faith application of its laws.
ARTICLE 6.15: TRANSPARENCY
or Parties to become acquainted with them.
ARTICLE 6.16: SPECIFIC COMMITMENTS AND EXCEPTIONS
(a) In the case of India – The Schedule of Specific Commitments that India undertakes under paragraph 1 of Article 3 are set out in Annex 6A, which specifies the terms, limitations, conditions and qualifications on national treatment in relation to paragraph 1 of Article 6.3.
(b) In the case of Singapore – paragraph 1 of Article 6.3 shall not apply to any exception that is specified by Singapore or any measure that Singapore maintains with respect to sectors, sub-sectors or activities as set out in its Schedule of Reservations at Annex 6B.
(a) any exception that is specified by the Parties; or
(b) any measure that the Parties maintain with respect to sectors, sub-sectors
or activities as set out
in their respective Schedules at Annexes 6A and 6B.
ARTICLE 6.17: REVIEW OF COMMITMENTS AND EXCEPTIONS
50
(a) India undertakes to review its Schedule of Specific Commitment as set out in Annex 6A with a view to increasing its list of committed sectors and reducing the terms, limitations, conditions and qualifications on national treatment with regard to the establishment, acquisition or expansion of investments; and
(b) Singapore undertakes to review the status of the exceptions set out in its Schedule in Annex 6B with a view to reducing the exceptions or removing them.
a review of its commitments/exceptions:
(a) In the case of India as set out in Annex 6A - its list of committed sectors and reducing the terms, limitations, conditions and qualifications on national treatment with regard to the establishment, acquisition or expansion of investments; or
(b) In the case of Singapore as set out in Annex 6B – its exceptions with a view to reducing or removing them.
Any review pursuant to such a request should maintain the overall balance of commitments undertaken by each Party under this Agreement.
ARTICLE 6.18: ACCESS TO COURTS OF JUSTICE
Each Party shall within its territory accord to investors of the other Party treatment no less favourable than the treatment, which it accords in like circumstances to
its own investors, with respect to access to its courts of justice and administrative tribunals and agencies in all degrees of jurisdiction both in pursuit and in defence of such investors’ rights.
ARTICLE 6.19: SENIOR MANAGEMENT AND BOARD OF DIRECTORS