Table of Contents
Preamble
Chapter 1 General Provisions
Article 1 Objectives
Article 2 General Definitions
Article 3 Transparency
Article 4 Public Comment Procedures
Article 5 Administrative Procedures
Article 6 Review and Appeal
Article 7 Administrative Guidance
Article 8 Measures against Corruption and Bribery
Article 9 Confidential Information
Article 10 Taxation
Article 11 General and Security Exceptions
Article 12 Relation to Other Agreements
Article 13 Implementing Agreement
Article 14 Joint Committee
Article 15 Sub-Committees
Article 16 Communications
Chapter 2 Trade in Goods
Article 17 Definitions
Article 18 Classification of Goods
Article 19 National Treatment
Article 20 Elimination of Customs Duties
Article 21 Customs Valuation
Article 22 Export Subsidies
Article 23 Non-tariff Measures
Article 24 Bilateral Safeguard Measures
Article 25 Restrictions to Safeguard the Balance of Payments
Article 26 Sub-Committee on Trade in Goods
Article 27 Operational Procedures for Trade in Goods
Chapter 3 Rules of Origin
Article 28 Definitions
Article 29 Originating Goods
Article 30 Accumulation
Article 31 De Minimis
Article 32 Non-qualifying Operations
Article 33 Consignment Criteria
Article 34 Unassembled or Disassembled Goods
Article 35 Fungible Goods and Materials
Article 36 Indirect Materials
Article 37 Accessories, Spare Parts and Tools
Article 38 Packaging Materials and Containers for Retail Sale
Article 39 Packing Materials and Containers for Shipment
Article 40 Claim for Preferential Tariff Treatment
Article 41 Certificate of Origin
Article 42 Obligations regarding Exportations
Article 43 Request for Checking of Certificate of Origin
Article 44 Verification Visit
Article 45 Determination of Origin and
Preferential Tariff Treatment
Article 46 Confidentiality
Article 47 Penalties and Measures against False Declaration
Article 48 Miscellaneous
Article 49 Sub-Committee on Rules of Origin
Article 50 Operational Procedures for Rules of Origin
Chapter 4 Customs Procedures
Article 51 Scope
Article 52 Definition
Article 53 Transparency
Article 54 Customs Clearance
Article 55 Cooperation and Exchange of Information
Article 56 Sub-Committee on Customs Procedures
Chapter 5 Investment
Article 57 Scope
Article 58 Definitions
Article 59 National Treatment
Article 60 Most-Favoured-Nation Treatment
Article 61 General Treatment
Article 62 Access to the Courts of Justice
Article 63 Prohibition of Performance Requirements
Article 64 Reservations and Exceptions
Article 65 Expropriation and Compensation
Article 66 Protection from Strife
Article 67 Transfers
Article 68 Subrogation
Article 69 Settlement of Investment Disputes between a Party and an Investor of the Other Party
Article 70 Temporary Safeguard Measures
Article 71 Prudential Measures
Article 72 Denial of Benefits
Article 73 Taxation Measures as Expropriation
Article 74 Environmental Measures
Article 75 Sub-Committee on Investment
Chapter 6 Trade in Services
Article 76 Scope
Article 77 Definitions
Article 78 Market Access
Article 79 National Treatment
Article 80 Additional Commitments
Article 81 Schedule of Specific Commitments
Article 82 Most-Favoured-Nation Treatment
Article 83 Authorization, Licensing or Qualification
Article 84 Mutual Recognition
Article 85 Transparency
Article 86 Monopolies and Exclusive Service Suppliers
Article 87 Payments and Transfers
Article 88 Restrictions to Safeguard the Balance of Payments
Article 89 Emergency Safeguard Measures
Article 90 Denial of Benefits
Article 91 Sub-Committee on Trade in Services
Chapter 7 Movement of Natural Persons
Article 92 Scope
Article 93 Definition
Article 94 Specific Commitments
Article 95 Requirements and Procedures
Article 96 Sub-Committee on Movement of Natural Persons
Chapter 8 Energy and Mineral Resources
Article 97 Definitions
Article 98 Promotion and Facilitation of Investment
Article 99 Import and Export Restrictions
Article 100 Export Licensing Procedures and Administrations
Article 101 Energy and Mineral Resource Regulatory Measures
Article 102 Environmental Aspects
Article 103 Community Development
Article 104 Cooperation
Article 105 Sub-Committee on Energy and Mineral Resources
Chapter 9 Intellectual Property
Article 106 General Provisions
Article 107 Definitions
Article 108 National Treatment and Most-Favoured-Nation Treatment
Article 109 Procedural Matters
Article 110 Transparency
Article 111 Promotion of Public Awareness of
Protection of Intellectual Property
Article 112 Patents
Article 113 Industrial Designs
Article 114 Trademarks
Article 115 Copyright and Related Rights
Article 116 New Varieties of Plants
Article 117 Acts of Unfair Competition
Article 118 Protection of Undisclosed Information
Article 119 Enforcement – Border Measures
Article 120 Enforcement – Civil Remedies
Article 121 Enforcement – Criminal Remedies
Article 122 Cooperation
Article 123 Sub-Committee on Intellectual Property
Chapter 10 Government Procurement
Article 124 Exchange of Information
Article 125 Sub-Committee on Government Procurement
Chapter 11 Competition
Article 126 Promotion of Competition by Addressing Anti-competitive Activities
Article 127 Cooperation on the Promotion of Competition
Article 128 Non-Discrimination
Article 129 Procedural Fairness
Article 130 Non-Application of Paragraph 2 of Article 9
Chapter 12 Improvement of Business Environment and Promotion of Business Confidence
Article 131 Basic Principles
Article 132 Sub-Committee on Improvement of Business Environment and Promotion of Business Confidence
Article 133 Liaison Office on Improvement of Business Environment
Chapter 13 Cooperation
Article 134 Basic Principles
Article 135 Areas and Forms of Cooperation
Article 136 Costs of Cooperation
Article 137 Sub-Committee on Cooperation
Chapter 14 Dispute Settlement
Article 138 Scope
Article 139 General Principle
Article 140 Consultations
Article 141 Good Offices, Conciliation or Mediation
Article 142 Establishment of Arbitral Tribunals
Article 143 Functions of Arbitral Tribunals
Article 144 Proceedings of Arbitral Tribunals
Article 145 Suspension and Termination of Proceedings
Article 146 Implementation of Award
Article 147 Modification of Time Periods
Article 148 Expenses
Chapter 15 Final Provisions
Article 149 Table of Contents and Headings
Article 150 Annexes and Notes
Article 151 General Review
Article 152 Amendment
Article 153 Entry into Force
Article 154 Termination
Annex 1 referred to Schedules in relation to in Chapter 2 Article 20
Annex 2 referred to Product Specific Rules in Chapter 3
Annex 3 referred to Minimum Data Requirement for in Chapter 3 Certificate of Origin
Annex 4 referred to Reservations for Measures referred in Chapter 5 to in Subparagraph 1(a) of Article 64
Annex 5 referred to Reservations for Measures referred in Chapter 5 to in Paragraph 3 of Article 64
Annex 6 referred to Additional Provisions with respect in Chapter 5 to the Settlement of Investment Disputes referred to in Paragraph 21 of Article 69
Annex 7 referred to Financial Services in Chapter 6
Annex 8 referred to Schedules of Specific Commitments in Chapter 6 in relation to Article 81
Annex 9 referred to Lists of Most-Favoured-Nation in Chapter 6 Treatment Exemptions in relation to Article 82
Annex 10 referred to Specific Commitments for the in Chapter 7 Movement of Natural Persons
Annex 11 referred to List of Energy and Mineral Resource in Chapter 8 Goods
Annex 12 referred to Additional Provisions with respect in Chapter 8 to the Promotion and Facilitation of Investment in the Energy and Mineral Resource Sector referred to in Paragraph 2 of Article 98
HAVE AGREED as follows:
Chapter 1
General Provisions
Article 1
Objectives
The objectives of this Agreement are to:
(a) facilitate, promote and liberalize trade in goodand services between the Parties;
(b) increase investment opportunities and promote investment activities through strengthening
protection for investments and investment activities in the Parties;
(c) ensure protection of intellectual property and promote cooperation in the field thereof;
(d) enhance transparency of government procurement regimes of the Parties, and promote cooperation for mutual benefits of the Parties in the field of government procurement;
(e) promote competition by addressing anticompetitive
activities, and cooperate on the
promotion of competition;
(f) improve business environment in the Parties;
(g) establish a framework to enhance closer
cooperation in the fields agreed in this
Agreement; and
(h) create effective procedures for the
implementation and application of this Agreement
and for the resolution of disputes.
Article 2
General Definitions
1. For the purposes of this Agreement:
(a) the term “Area” means:
(i) with respect to Japan, the territory of
Japan, and all the area beyond its
territorial sea, including the sea-bed and
subsoil thereof, over which Japan exercises
sovereign rights or jurisdiction in
accordance with international law and the
laws and regulations of Japan; and
(ii) with respect to Indonesia, the land
territories, territorial sea including seabed
and subsoil thereof, archipelagic
waters, internal waters, airspace over such
territories, sea and waters, as well as
continental shelf and exclusive economic
zone, over which Indonesia has sovereignty,
sovereign rights or jurisdiction, as defined
in its laws, and in accordance with the
United Nations Convention on the Law of the
Sea, done at Montego Bay, December 10, 1982;
(b) the term “customs authority” means the authority
that is responsible for the administration and
enforcement of customs laws and regulations. In
the case of Japan, the Ministry of Finance, and
in the case of Indonesia, the Directorate General
of Customs and Excise;
(c) the term “GATS” means the General Agreement on
Trade in Services in Annex 1B to the Marrakesh
Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994;
(d) the term “GATT 1994” means the General Agreement
on Tariffs and Trade 1994 in Annex 1A to the
Marrakesh Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994.
For the purposes of this Agreement, references to
articles in the GATT 1994 include the
interpretative notes;
(e) the term “Harmonized System” or “HS” means the
Harmonized Commodity Description and Coding
System set out in the Annex to the International
Convention on the Harmonized Commodity
Description and Coding System, and adopted and
implemented by the Parties in their respective
laws;
(f) the term “Parties” means Japan and Indonesia and
the term “Party” means either Japan or Indonesia;
and
(g) the term “WTO Agreement” means the Marrakesh
Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994.
2. Nothing in subparagraph 1(a) shall affect the rights
and obligations of the Parties under international law,
including those under the United Nations Convention on the
Law of the Sea, done at Montego Bay, December 10, 1982.
Article 3
Transparency
1. Each Party shall make publicly available its laws and
regulations as well as international agreements to which
the Party is a party, with respect to any matter covered by
this Agreement.
2. Each Party shall make available to the public, the
names and addresses of the competent authorities
responsible for laws and regulations referred to in
paragraph 1.
3. Each Party shall, upon the request by the other Party,
within a reasonable period of time, provide information to
the other Party with respect to matters referred to in
paragraph 1.
4. When introducing or changing its laws and regulations
that significantly affect the implementation and operation
of this Agreement, each Party shall endeavor to take
appropriate measures to enable interested persons to become
acquainted with such introduction or change.
Article 4
Public Comment Procedures
The Government of each Party shall, in accordance with
the laws and regulations of the Party, endeavor to make
public in advance regulations of general application that
affect any matter covered by this Agreement and to provide
a reasonable opportunity for comments by the public before
adoption of such regulations.
Article 5
Administrative Procedures
1. Where administrative decisions which pertain to or
affect the implementation and operation of this Agreement
are taken by the competent authorities of the Government of
a Party, the competent authorities shall, in accordance
with the laws and regulations of the Party, endeavor to:
(a) inform the applicant of the decision within a
reasonable period of time after the submission of
the application considered complete under the
laws and regulations of the Party, taking into
account the established standard period of time
referred to in paragraph 3; and
(b) provide, within a reasonable period of time,
information concerning the status of the
application, at the request of the applicant.
2. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, establish criteria for taking administrative
decisions in response to submitted applications. The
competent authorities shall endeavor to:
(a) make such criteria as specific as possible; and
(b) make such criteria publicly available except when
it would extraordinarily raise administrative
difficulties for the Government of the Party.
3. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, endeavor to:
(a) establish standard periods of time between the
receipt of applications by the competent
authorities and the administrative decisions
taken in response to submitted applications; and
(b) make publicly available such periods of time, if
established.
4. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, prior to any final decision which imposes
obligations on or restricts rights of a person, endeavor to
provide that person with:
(a) a reasonable notice, including a description of
the nature of the measure, specific provisions
upon which such measure will be based, and the
facts which may be a cause of taking such
measure; and
(b) a reasonable opportunity to present facts and
arguments in support of position of such person,
provided that time, nature of the measure and public
interest permit.
Article 6
Review and Appeal
1. Each Party shall, in accordance with its laws and
regulations, maintain judicial tribunals or procedures for
the purpose of prompt review and, where warranted,
correction of actions taken by its Government regarding
matters covered by this Agreement. Such tribunals or
procedures shall be impartial and independent of the
authorities entrusted with the administrative enforcement
of such actions.
2. Each Party shall ensure that the parties in any such
tribunals or procedures are provided with the right to:
(a) a reasonable opportunity to support or defend
their respective positions; and
(b) a decision based on the evidence and submissions
of record.
3. Each Party shall ensure, subject to appeal or further
review as provided for in its laws and regulations, that
such decision is implemented by the relevant authorities
with respect to the action at issue which is taken by its
Government.
Article 7
Administrative Guidance
1. For the purposes of this Article, the term
“administrative guidance” means any guidance,
recommendation or advice by a competent authority of the
Government of a Party which requires a person to do or
refrain from doing any act but does not create, impose
limitations on or in any way affect rights and obligations
of such person in order to pursue administrative
objectives.
2. Where a competent authority of the Government of a
Party renders administrative guidance with regard to any
matter covered by this Agreement, such competent authority
shall ensure that the administrative guidance does not
exceed the scope of its competence and shall not require
the person concerned to comply with the administrative
guidance without voluntary cooperation of such person.
3. Such competent authority shall ensure, in accordance
with the laws and regulations of its Party, that the person
concerned not be treated unfavourably solely on account of
non-compliance of such person with such administrative
guidance.
4. Such competent authority shall, in accordance with the
laws and regulations of its Party, provide to the person
concerned in writing, upon the request of such person, the
purposes and contents of the administrative guidance.
Article 8
Measures against Corruption and Bribery
Each Party shall, in accordance with its laws and
regulations, take appropriate measures to prevent and
combat corruption and bribery regarding matters covered by
this Agreement.
Article 9
Confidential Information
1. Each Party shall, in accordance with its laws and
regulations, maintain the confidentiality of information
provided in confidence by the other Party pursuant to this
Agreement.
2. Unless otherwise provided for in this Agreement,
nothing in this Agreement shall require a Party to provide
the other Party with confidential information, the
disclosure of which would impede the enforcement of the
laws and regulations of the former Party, or otherwise be
contrary to the public interest of the former Party, or
which would prejudice legitimate commercial interests of
particular enterprises, public or private.
Article 10
Taxation
1. Unless otherwise provided for in this Agreement, the
provisions of this Agreement shall not apply to any
taxation measures.
2. Nothing in this Agreement shall affect the rights and
obligations of either Party under any tax convention in
force between the Parties. In the event of any
inconsistency between this Agreement and any such
convention, that convention shall prevail to the extent of
the inconsistency.
3. Articles 3 and 9 shall apply to taxation measures, to
the extent that the provisions of this Agreement are
applicable to such taxation measures.
Article 11
General and Security Exceptions
1. For the purposes of Chapters 2, 3, 4, 5 other than
Article 66, and 8 of this Agreement, Articles XX and XXI of
the GATT 1994 are incorporated into and form part of this
Agreement, mutatis mutandis.
2. For the purposes of Chapters 5 other than Article 66,
6 and 7 of this Agreement, Articles XIV and XIV bis of the
GATS are incorporated into and form part of this Agreement, mutatis mutandis.
3. In cases where a Party takes any measure pursuant to
paragraph 1 or 2, that does not conform with the
obligations under Chapter 5 other than Article 66, the
Party shall make reasonable effort to notify the other
Party of the description of such measure either before the
measure is taken or as soon as possible thereafter.
4. For the purposes of Chapter 9 of this Agreement,
Article 73 of the Agreement on Trade-Related Aspects of
Intellectual Property Rights in Annex 1C to the WTO
Agreement (hereinafter referred to as “the TRIPS
Agreement”) is incorporated into and forms part of this
Agreement, mutatis mutandis.
Article 12
Relation to Other Agreements
1. The Parties reaffirm their rights and obligations
under the WTO Agreement or any other agreements to which
both Parties are parties.
2. In the event of any inconsistency between this
Agreement and the WTO Agreement, the WTO Agreement shall
prevail to the extent of the inconsistency.
3. In the event of any inconsistency between this
Agreement and any agreements other than the WTO Agreement,
to which both Parties are parties, the Parties shall
immediately consult with each other with a view to finding
a mutually satisfactory solution, taking into consideration
general principles of international law.
Article 13
Implementing Agreement
The Governments of the Parties shall conclude a
separate agreement setting forth the details and procedures
for the implementation of this Agreement (hereinafter
referred to as “the Implementing Agreement”).
Article 14
Joint Committee
1. A joint committee (hereinafter referred to as “the
Joint Committee”) shall be hereby established.
2. The functions of the Joint Committee shall be:
(a) reviewing and monitoring the implementation and
operation of this Agreement;
(b) considering and recommending to the Parties any
amendments to this Agreement;
(c) supervising and coordinating the work of all Sub-
Committees established under this Agreement;
(d) adopting:
(i) the Operational Procedures for Trade in
Goods and the Operational Procedures for
Rules of Origin, referred to in Article 27
and Article 50, respectively; and
(ii) any necessary decisions; and
(e) carrying out other functions as the Parties may
agree.
3. The Joint Committee:
(a) shall be composed of representatives of the
Governments of the Parties; and
(b) may establish and delegate its responsibilities
to Sub-Committees.
4. The Joint Committee shall establish its rules and
procedures.
5. The Joint Committee shall meet as such times as may be
agreed by the Parties. The venue of the meeting shall be
alternately in Japan and Indonesia, unless the Parties
agree otherwise.
Article 15
Sub-Committees
1. The following sub-committees shall be hereby
established:
(a) Sub-Committee on Trade in Goods;
(b) Sub-Committee on Rules of Origin;
(c) Sub-Committee on Customs Procedures;
(d) Sub-Committee on Investment;
(e) Sub-Committee on Trade in Services;
(f) Sub-Committee on Movement of Natural Persons;
(g) Sub-Committee on Energy and Mineral Resources;
(h) Sub-Committee on Intellectual Property;
(i) Sub-Committee on Government Procurement;
(j) Sub-Committee on Improvement of Business
Environment and Promotion of Business Confidence;
and
(k) Sub-Committee on Cooperation.
2. A Sub-Committee shall:
(a) be composed of representatives of the Governments
of the Parties and may, by mutual consent of the
Parties, invite representatives of relevant
entities other than the Governments of the
Parties with the necessary expertise relevant to
the issues to be discussed; and
(b) be co-chaired by officials of the Governments of
the Parties.
3. A Sub-Committee shall meet at such times and venues as
may be agreed upon by the Parties.
4. A Sub-Committee may, as necessary, establish its rules
and procedures.
5. A Sub-Committee may establish and delegate its
responsibilities to Working Groups.
Article 16
Communications
Each Party shall designate a contact point to
facilitate communications between the Parties on any matter
relating to this Agreement.
Chapter 2
Trade in Goods
Article 17
Definitions
For the purposes of this Chapter:
(a) the term “bilateral safeguard measure” means a
bilateral safeguard measure provided for in
paragraph 1 of Article 24;
(b) the term “customs value of goods” means the value
of goods for the purposes of levying ad valorem
customs duties on imported goods;
(c) the term “domestic industry” means the producers
as a whole of the like or directly competitive
goods operating in a Party, or those whose
collective output of the like or directly
competitive goods constitutes a major proportion
of the total domestic production of those goods;
(d) the term “export subsidies” means export
subsidies listed in subparagraphs 1(a) through
(f) of Article 9 of the Agreement on Agriculture
in Annex 1A to the WTO Agreement (hereinafter
referred to in this Chapter as “the Agreement on
Agriculture”);
(e) the term “originating goods” means goods which
qualify as originating goods under the provisions
of Chapter 3;
(f) the term “other duties or charges of any kind”
means those provided for in subparagraph 1(b) of
Article II of the GATT 1994;
(g) the term “provisional bilateral safeguard
measure” means a provisional bilateral safeguard
measure provided for in subparagraph 9(a) of
Article 24;
(h) the term “serious injury” means a significant
overall impairment in the position of a domestic
industry; and
(i) the term “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 18
Classification of Goods
The classification of goods in trade between the
Parties shall be in conformity with the Harmonized System.
Article 19
National Treatment
Each Party shall accord national treatment to the
goods of the other Party in accordance with Article III of
the GATT 1994.
Article 20
Elimination of Customs Duties
1. Except as otherwise provided for in this Agreement,
each Party shall eliminate or reduce its customs duties on
originating goods of the other Party designated for such
purposes in its Schedule in Annex 1, in accordance with the
terms and conditions set out in such Schedule.
2. Upon the request of either Party, the Parties shall
negotiate on issues such as improving market access
conditions on originating goods designated for negotiation
in the Schedule in Annex 1, in accordance with the terms
and conditions set out in such Schedule.
3. Each Party shall eliminate other duties or charges of
any kind imposed on or in connection with the importation
of goods of the other Party, if any. Neither Party shall
introduce other duties or charges of any kind imposed on or
in connection with the importation of goods of the other
Party.
4. Nothing in this Article shall prevent a Party from
imposing, at any time, on the importation of any good of
the other Party:
(a) a charge equivalent to an internal tax imposed
consistently with the provisions of paragraph 2
of Article III of the GATT 1994, in respect of
the like domestic good or in respect of a good
from which the imported good has been
manufactured or produced in whole or in part;
(b) any anti-dumping or countervailing duty applied
consistently with the provisions of Article VI of
the GATT 1994, the Agreement on Implementation of
Article VI of the General Agreement on Tariffs
and Trade 1994 in Annex 1A to the WTO Agreement,
and the Agreement on Subsidies and Countervailing
Measures in Annex 1A to the WTO Agreement; and
(c) fees or other charges commensurate with the cost
of services rendered.
5. If, as a result of the elimination or reduction of
its customs duty applied on a particular good on a mostfavoured-
nation basis, the most-favoured-nation applied
rate becomes equal to, or lower than, the rate of customs
duty to be applied in accordance with paragraph 1 on the
originating good which is classified under the same tariff
line as that particular good, each Party shall notify the
other Party of such elimination or reduction without delay.
6. In cases where its most-favoured-nation applied rate
of customs duty on a particular good is lower than the rate
of customs duty to be applied in accordance with paragraph
1 on the originating good which is classified under the
same tariff line as that particular good, each Party shall
apply the lower rate with respect to that originating good.
Article 21
Customs Valuation
For the purposes of determining the customs value of
goods traded between the Parties, provisions of Part I of
the Agreement on Implementation of Article VII of the
General Agreement on Tariffs and Trade 1994 in Annex 1A to
the WTO Agreement (hereinafter referred to as “the
Agreement on Customs Valuation”), shall apply mutatis
mutandis.
Article 22
Export Subsidies
Neither Party shall introduce or maintain any export
subsidies on any agricultural good which is listed in Annex
1 to the Agreement on Agriculture.
Article 23
Non-tariff Measures
Each Party shall not introduce or maintain any nontariff
measures on the importation of any good of the other
Party or on the exportation or sale for export of any good
destined for the other Party which are inconsistent with
its obligations under the WTO Agreement.
Article 24
Bilateral Safeguard Measures
1. Subject to the provisions of this Article, each Party
may, as a bilateral safeguard measure, to the minimum
extent necessary to prevent or remedy the serious injury to
a domestic industry of that Party and to facilitate
adjustment:
(a) suspend the further reduction of any rate of
customs duty on the originating good provided for
in this Chapter; or
(b) increase the rate of customs duty on the
originating good to a level not to exceed the
lesser of:
(i) the most-favoured-nation applied rate of
customs duty in effect at the time when the
bilateral safeguard measure is taken; and
(ii) the most-favoured-nation applied rate of
customs duty in effect on the day
immediately preceding the date of entry into
force of this Agreement,
if an originating good of the other Party, as a result of
the elimination or reduction of a customs duty in
accordance with Article 20, is being imported into the
former Party in such increased quantities, in absolute
terms or relative to domestic production, and under such
conditions that the imports of that originating good
constitute a substantial cause of serious injury, or threat
of serious injury, to a domestic industry of the former
Party.
2. Each Party shall not apply a bilateral safeguard
measure on an originating good imported up to the limit of
quota quantities granted under tariff rate quotas applied
in accordance with its Schedule in Annex 1.
3. (a) A Party may take a bilateral safeguard measure
only after an investigation has been carried out
by the competent authorities of that Party in
accordance with Article 3 and paragraph 2 of
Article 4 of the Agreement on Safeguards in Annex
1A to the WTO Agreement (hereinafter referred to
in this Article as “the Agreement on
Safeguards”).
(b) The investigation referred to in subparagraph (a)
shall in all cases be completed within one year
following its date of initiation.
4. The following conditions and limitations shall apply
with regard to a bilateral safeguard measure:
(a) A Party shall immediately deliver a written
notice to the other Party upon:
(i) initiating an investigation referred to in
subparagraph 3(a) relating to serious
injury, or threat of serious injury, and the
reasons for it; and
(ii) taking a decision to apply or extend a
bilateral safeguard measure.
(b) The Party making the written notice referred to
in subparagraph (a) shall provide the other Party
with all pertinent information, which shall
include:
(i) in the written notice referred to in
subparagraph (a)(i), the reason for the
initiation of the investigation, a precise
description of the originating good subject
to the investigation and its subheading of
the Harmonized System, the period subject to
the investigation and the date of initiation
of the investigation; and
(ii) in the written notice referred to in
subparagraph (a)(ii), evidence of serious
injury or threat of serious injury caused by
the increased imports of the originating
good, a precise description of the
originating good subject to the proposed
bilateral safeguard measure and its
subheading of the Harmonized System, a
precise description of the bilateral
safeguard measure, the proposed date of its
introduction and its expected duration.
(c) A Party proposing to apply or extend a bilateral
safeguard measure shall provide adequate
opportunity for prior consultations with the
other Party with a view to reviewing the
information arising from the investigation
referred to in subparagraph 3(a), exchanging
views on the bilateral safeguard measure and
reaching an agreement on compensation set out in
paragraph 5.
(d) No bilateral safeguard measure shall be
maintained except to the extent and for such time
as may be necessary to prevent or remedy serious
injury and to facilitate adjustment, provided
that such time shall not exceed a period of four
years. However, in very exceptional
circumstances, a bilateral safeguard measure may
be extended, provided that the total period of
the bilateral safeguard measure, including such
extensions, shall not exceed five years. In
order to facilitate adjustment in a situation
where the expected duration of a bilateral
safeguard measure is over one year, the Party
maintaining the bilateral safeguard measure shall
progressively liberalize the bilateral safeguard
measure at regular intervals during the period of
application.
(e) No bilateral safeguard measure shall be applied
again to the import of a particular originating
good which has been subject to such a bilateral
safeguard measure, for a period of time equal to
the duration of the previous bilateral safeguard
measure or one year, whichever is longer.
(f) Upon the termination of a bilateral safeguard
measure, the rate of customs duty shall be the
rate which would have been in effect but for the
bilateral safeguard measure.
5. (a) A Party proposing to apply or extend a bilateral
safeguard measure shall provide to the other
Party mutually agreed adequate means of trade
compensation in the form of concessions of
customs duties whose levels are substantially
equivalent to the value of the additional customs
duties expected to result from the bilateral
safeguard measure.
(b) If the Parties are unable to agree on the
compensation within 30 days after the
commencement of the consultation pursuant to
subparagraph 4(c), the Party against whose
originating good the bilateral safeguard measure
is taken shall be free to suspend the application
of concessions of customs duties under this
Agreement, which are substantially equivalent to
the bilateral safeguard measure. The Party
exercising the right of suspension may suspend
the application of concessions of customs duties
only for the minimum period necessary to achieve
the substantially equivalent effects and only
while the bilateral safeguard measure is
maintained.
6. Nothing in this Chapter shall prevent a Party from
applying safeguard measures to an originating good in
accordance with:
(a) Article XIX of the GATT 1994 and the Agreement on
Safeguards; or
(b) Article 5 of the Agreement on Agriculture.
7. Each Party shall ensure the consistent, impartial and
reasonable administration of its laws and regulations
relating to the bilateral safeguard measure.
8. Each Party shall adopt or maintain equitable, timely,
transparent and effective procedures relating to the
bilateral safeguard measure.
9. (a) In critical circumstances, where delay would
cause damage which it would be difficult to
repair, a Party may take a provisional bilateral
safeguard measure, which shall take the form of
the measure set out in subparagraph 1(a) or (b)
pursuant to a preliminary determination that
there is clear evidence that increased imports of
an originating good have caused or are
threatening to cause serious injury to a domestic
industry.
(b) A Party shall deliver a written notice to the
other Party prior to applying a provisional
bilateral safeguard measure. Consultations
between the Parties on the application of the
provisional bilateral safeguard measure shall be
initiated immediately after the provisional
bilateral safeguard measure is taken.
(c) The duration of the provisional bilateral
safeguard measure shall not exceed 200 days.
During that period, the pertinent requirements of
paragraph 3 shall be met. The duration of the
provisional bilateral safeguard measure shall be
counted as a part of the period referred to in
subparagraph 4(d).
(d) Subparagraph 4(f) and paragraphs 7 and 8 shall be
applied mutatis mutandis to the provisional
bilateral safeguard measure. The customs duty
imposed as a result of the provisional bilateral
safeguard measure shall be refunded if the
subsequent investigation referred to in
subparagraph 3(a) does not determine that
increased imports of the originating good have
caused or threatened to cause serious injury to a
domestic industry.
10. Written notice referred to in subparagraphs 4(a) and
9(b) and any other communication between the Parties shall
be done in the English language.
11. The Parties shall review the provisions of this
Article, if necessary, five years after the date of entry
into force of this Agreement, unless otherwise agreed by
the Parties.
Article 25
Restrictions to Safeguard the Balance of Payments
1. Nothing in this Chapter shall be construed to prevent
a Party from taking any measure for balance-of-payments
purposes. A Party taking such measure shall do so in
accordance with the conditions established under Article
XII of the GATT 1994 and the Understanding on the Balance of-
Payments Provisions of the General Agreement on Tariffs
and Trade 1994 in Annex 1A to the WTO Agreement.
2. Nothing in this Chapter shall preclude the use by a
Party of exchange controls or exchange restrictions in
accordance with the Articles of Agreement of the
International Monetary Fund.
Article 26
Sub-Committee on Trade in Goods
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Trade in Goods (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee;
(d) reviewing and making appropriate recommendations,
as necessary, to the Joint Committee on the
Operational Procedures for Trade in Goods
referred to in Article 27; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Article 27
Operational Procedures for Trade in Goods
Upon the date of entry into force of this Agreement,
the Joint Committee shall adopt the Operational Procedures
for Trade in Goods that provide detailed regulations
pursuant to which the relevant authorities of the Parties
shall implement their functions under this Chapter.
Chapter 3
Rules of Origin
Article 28
Definitions
For the purposes of this Chapter:
(a) the term “competent governmental authority” means
the authority that, according to the legislation
of each Party, is responsible for the issuing of
a certificate of origin or for the designation of
certification entities or bodies. In the case of
Japan, the Ministry of Economy, Trade and
Industry and in the case of Indonesia, the
Ministry of Trade;
(b) the term “exporter” means a person located in an
exporting Party who exports a good from the
exporting Party in accordance with the applicable
laws and regulations of the exporting Party;
(c) the term “factory ships of the Party” or “vessels
of the Party” respectively means factory ships or
vessels:
(i) which are registered in the Party;
(ii) which sail under the flag of the Party;
(iii) which are owned to an extent of at least 50
percent by nationals of the Parties, or by a
juridical person with its head office in
either Party, of which the representatives,
chairman of the board of directors, and the
majority of the members of such board are
nationals of the Parties, and of which at
least 50 percent of the equity interest is
owned by nationals or juridical persons of
the Parties; and
(iv) of which at least 75 percent of the total of
the master, officers and crew are nationals
of the Parties;
(d) the term “fungible originating goods of a Party”
or “fungible originating materials of a Party”
respectively means originating goods or materials
of a Party that are interchangeable for
commercial purposes, whose properties are
essentially identical;
(e) the term “Generally Accepted Accounting
Principles” means the recognized consensus or
substantial authoritative support within 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;
(f) the term “importer” means a person who imports a
good into the importing Party in accordance with
the applicable laws and regulations of the
importing Party;
(g) the term “indirect materials” means goods used in
the production, testing or inspection of another
good but not physically incorporated into the
good, or goods used in the maintenance of
buildings or the operation of equipment
associated with the production of another good,
including:
(i) fuel and energy;
(ii) tools, dies and moulds;
(iii) spare parts and goods used in the
maintenance of equipment and buildings;
(iv) lubricants, greases, compounding materials
and other goods used in production or used
to operate equipment and buildings;
(v) gloves, glasses, footwear, clothing, safety
equipment and supplies;
(vi) equipment, devices and supplies used for
testing or inspection;
(vii) catalysts and solvents; and
(viii) any other goods that are not incorporated
into another good but whose use in the
production of the good can reasonably be
demonstrated to be a part of that
production;
(h) the term “material” means a good that is used in
the production of another good;
(i) the term “originating material of a Party” means
an originating good of a Party which is used in
the production of another good in the Party,
including that which is considered as an
originating material of the Party pursuant to
paragraph 1 of Article 30;
(j) the term “packing materials and containers for
shipment” means goods that are normally used to
protect a good during transportation, other than
packaging materials and containers for retail
sale referred to in Article 38;
(k) the term “preferential tariff treatment” means
the rate of customs duties applicable to an
originating good of the exporting Party in
accordance with paragraph 1 of Article 20; and
(l) the term “production” means a method of obtaining
goods including manufacturing, assembling,
processing, raising, growing, breeding, mining,
extracting, harvesting, fishing, trapping,
gathering, collecting, hunting and capturing.
Article 29
Originating Goods
1. Except as otherwise provided for in this Chapter, a
good shall qualify as an originating good of a Party where:
(a) the good is wholly obtained or produced entirely
in the Party, as defined in paragraph 2;
(b) the good is produced entirely in the Party
exclusively from originating materials of the
Party; or
(c) the good satisfies the product specific rules set
out in Annex 2, as well as all other applicable
requirements of this Chapter, when the good is
produced entirely in the Party using nonoriginating
materials.
2. For the purposes of subparagraph 1(a), the following
goods shall be considered as being wholly obtained or
produced entirely in a Party:
(a) live animals born and raised in the Party;
(b) animals obtained by hunting, trapping, fishing,
gathering or capturing in the Party;
(c) goods obtained from live animals in the Party;
(d) plants and plant products harvested, picked or
gathered in the Party;
(e) minerals and other naturally occurring
substances, not included in subparagraphs (a)
through (d), extracted or taken in the Party;
(f) goods of sea-fishing and other goods taken by
vessels of the Party from the sea outside the
other Party;
(g) goods produced on board factory ships of the
Party outside the other Party from the goods
referred to in subparagraph (f);
(h) goods taken from the sea-bed or subsoil beneath
the sea-bed outside the Party, provided that the
Party has rights to exploit such sea-bed or
subsoil;
(i) articles collected in the Party which can no
longer perform their original purpose in the
Party nor are capable of being restored or
repaired and which are fit only for disposal or
for the recovery of parts or raw materials;
(j) scrap and waste derived from manufacturing or
processing operations or from consumption in the
Party and fit only for disposal or for the
recovery of raw materials;
(k) parts or raw materials recovered in the Party
from articles which can no longer perform their
original purpose nor are capable of being
restored or repaired; and
(l) goods obtained or produced in the Party
exclusively from the goods referred to in
subparagraphs (a) through (k).
3. For the purposes of subparagraph 1(c), the product
specific rules set out in Annex 2 requiring that the
materials used undergo a change in tariff classification or
a specific manufacturing or processing operation shall
apply only to non-originating materials.
4. (a) For the purposes of subparagraph 1(c), the
product specific rules set out in Annex 2 using
the value-added method require that the
qualifying value content of a good, calculated in
accordance with subparagraph (b), is not less
than the percentage specified by the rule for the
good.
(b) For the purposes of calculating the qualifying
value content of a good, the following formula
shall be applied:
F.O.B. – V.N.M.
Q.V.C. = ------------------- x 100
F.O.B.
Where:
Q.V.C. is the qualifying value content of a good,
expressed as a percentage;
F.O.B. is, except as provided for in paragraph 5,
the free-on-board value of a good payable by the
buyer of the good to the seller of the good,
regardless of the mode of shipment, not including
any internal excise taxes reduced, exempted, or
repaid when the good is exported; and
V.N.M. is the value of non-originating materials
used in the production of a good.
5. F.O.B. referred to in subparagraph 4(b) shall be the
value:
(a) adjusted to the first ascertainable price paid
for a good from the buyer to the producer of the
good, if there is free-on-board value of the
good, but it is unknown and cannot be
ascertained; or
(b) determined in accordance with Articles 1 through
8 of the Agreement on Customs Valuation, if there
is no free-on-board value of a good.
6. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b), the value of a
non-originating material used in the production of the good
in a Party:
(a) shall be determined in accordance with the
Agreement on Customs Valuation, and shall include
freight, insurance where appropriate, packing and
all the other costs incurred in transporting the
material to the importation port in the Party
where the producer of the good is located; or
(b) if such value is unknown and cannot be
ascertained, shall be the first ascertainable
price paid for the material in the Party, but may
exclude all the costs incurred in the Party in
transporting the material from the warehouse of
the supplier of the material to the place where
the producer is located such as freight,
insurance and packing as well as any other known
and ascertainable cost incurred in the Party.
7. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b) in determining
whether the good qualifies as an originating good of a
Party, V.N.M. of the good shall not include the value of
non-originating materials used in the production of
originating materials of the Party which are used in the
production of the good.
8. For the purposes of subparagraph 5(b) or 6(a), in
applying the Agreement on Customs Valuation to determine
the value of a good or non-originating material, the
Agreement on Customs Valuation shall apply mutatis mutandis
to domestic transactions or to the cases where there is no
transaction of the good or non-originating material.
Article 30
Accumulation
1. For the purposes of determining whether a good
qualifies as an originating good of a Party, an originating
good of the other Party which is used as a material in the
production of the good in the former Party may be
considered as an originating material of the former Party.
2. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b) of Article 29 in
determining whether the good qualifies as an originating
good of a Party, the value of a non-originating material
produced in either Party and to be used in the production
of the good may be limited to the value of non-originating
materials used in the production of such non-originating
material, provided that the good qualifies as an
originating good of that Party under subparagraph 1(c) of
Article 29.
Article 31
De Minimis
For the application of the product specific rules set
out in Annex 2, non-originating materials used in the
production of a good that do not satisfy an applicable rule
for the good, shall be disregarded, provided that the
totality of such materials does not exceed specific
percentages in value, weight or volume of the good and such
percentages are set out in the product specific rule for
the good.
Article 32
Non-qualifying Operations
A good shall not be considered to satisfy the
requirement of change in tariff classification or specific
manufacturing or processing operation set out in Annex
2 merely by reason of:
(a) operations to ensure the preservation of products
in good condition during transport and storage
(such as drying, freezing, keeping in brine) and
other similar operations;
(b) changes of packaging and breaking up and assembly
of packages;
(c) disassembly;
(d) placing in bottles, cases, boxes and other simple
packaging operations;
(e) collection of parts and components classified as
a good pursuant to Rule 2(a) of the General Rules
for the Interpretation of the Harmonized System;
(f) mere making-up of sets of articles; or
(g) any combination of operations referred to in
subparagraphs (a) through (f).
Article 33
Consignment Criteria
1. An originating good of the other Party shall be deemed
to meet the consignment criteria when it is:
(a) transported directly from the other Party; or
(b) transported through one or more non-Parties for
the purpose of transit or temporary storage in
warehouses in such non-Parties, provided that it
does not undergo operations other than unloading,
reloading and any other operation to preserve it
in good condition.
2. If an originating good of the other Party does not
meet the consignment criteria referred to in paragraph 1,
that good shall not be considered as an originating good of
the other Party.
Article 34
Unassembled or Disassembled Goods
1. Where a good satisfies the requirements of the
relevant provisions of Articles 29 through 32 and is
imported into a Party from the other Party in an
unassembled or disassembled form but is classified as an
assembled good pursuant to Rule 2(a) of the General Rules
for the Interpretation of the Harmonized System, such a
good shall be considered as an originating good of the
other Party.
2. A good assembled in a Party from unassembled or
disassembled materials, which were imported into the Party
and classified as an assembled good pursuant to Rule 2(a)
of the General Rules for the Interpretation of the
Harmonized System, shall be considered as an originating
good of the Party, provided that the good would have
satisfied the applicable requirements of the relevant
provisions of Articles 29 through 32 had each of the nonoriginating
materials among the unassembled or disassembled
materials been imported into the Party separately and not
as an unassembled or disassembled form.
Article 35
Fungible Goods and Materials
1. For the purposes of determining whether a good
qualifies as an originating good of a Party, where fungible
originating materials of the Party and fungible nonoriginating
materials that are commingled in an inventory
are used in the production of the good, the origin of the
materials may be determined pursuant to an inventory
management method under the Generally Accepted Accounting
Principles in the Party.
2. Where fungible originating goods of a Party and
fungible non-originating goods are commingled in an
inventory and, prior to exportation do not undergo any
production process or any operation in the Party where they
were commingled other than unloading, reloading and any
other operation to preserve them in good condition, the
origin of the good may be determined pursuant to an
inventory management method under the Generally Accepted
Accounting Principles in the Party.
Article 36
Indirect Materials
Indirect materials shall be, without regard to where
they are produced, considered to be originating materials
of a Party where the good is produced.
Article 37
Accessories, Spare Parts and Tools
1. In determining whether all the non-originating
materials used in the production of a good undergo the
applicable change in tariff classification or a specific
manufacturing or processing operation set out in Annex 2,
accessories, spare parts or tools delivered with the good
that form part of the good's standard accessories, spare
parts or tools, shall be disregarded, provided that:
(a) the accessories, spare parts or tools are not
invoiced separately from the good, without regard
of whether they are separately described in the
invoice; and
(b) the quantities and value of the accessories,
spare parts or tools are customary for the good.
2. If a good is subject to a qualifying value content
requirement, the value of the accessories, spare parts or
tools shall be taken into account as the value of
originating materials of a Party where the good is produced
or non-originating materials, as the case may be, in
calculating the qualifying value content of the good.
Article 38
Packaging Materials and Containers for Retail Sale
1. In determining whether all the non-originating
materials used in the production of a good undergo the
applicable change in tariff classification or a specific
manufacturing or processing operation set out in Annex 2,
packaging materials and containers for retail sale, which
are classified with the good pursuant to Rule 5 of the
General Rules for the Interpretation of the Harmonized
System, shall be disregarded.
2. If a good is subject to a qualifying value content
requirement, the value of packaging materials and
containers for retail sale shall be taken into account as
the value of originating materials of a Party where the
good is produced or non-originating materials, as the case
may be, in calculating the qualifying value content of the
good.
Article 39
Packing Materials and Containers for Shipment
Packing materials and containers for shipment shall
be:
(a) disregarded in determining whether all the nonoriginating
materials used in the production of a
good undergo the applicable change in tariff
classification or a specific manufacturing or
processing operation set out in Annex 2; and
(b) without regard to where they are produced,
considered to be originating materials of a Party
where the good is produced, in calculating the
qualifying value content of the good.
Article 40
Claim for Preferential Tariff Treatment
1. The importing Party shall require a certificate of
origin for an originating good of the exporting Party from
importers who claim the preferential tariff treatment for
the good.
2. Notwithstanding paragraph 1, the importing Party shall
not require a certificate of origin from importers for an
importation of a consignment of originating goods of the
exporting Party whose aggregate customs value does not
exceed 200 United States dollars or its equivalent amount
in the Party’s currency, or such higher amount as it may
establish.
3. Where an originating good of the exporting Party is
imported through one or more non-Parties, the importing
Party may require importers, who claim the preferential
tariff treatment for the good, to submit:
(a) a copy of through bill of lading; or
(b) a certificate or any other information given by
the customs authorities of such non-Parties or
other relevant entities, which evidences that the
good has not undergone operations other than
unloading, reloading and any other operation to
preserve it in good condition in those non-Parties.
Article 41
Certificate of Origin
1. A certificate of origin referred to in paragraph 1 of
Article 40 shall be issued by the competent governmental
authority of the exporting Party on request having been
made in writing by the exporter or its authorized agent.
Such certificate of origin shall include minimum data
specified in Annex 3.
2. For the purposes of this Article, the competent
governmental authority of the exporting Party may designate
other entities or bodies to be responsible for the issuance
of certificate of origin, under the authorization given in
accordance with the applicable laws and regulations of the
exporting Party.
3. Where the competent governmental authority of the
exporting Party designates other entities or bodies to
carry out the issuance of certificate of origin, the
exporting Party shall notify in writing the other Party of
its designees.
4. For the purposes of this Chapter, upon the entry into
force of this Agreement, the Parties shall establish a
format of certificate of origin in the English language in
the Operational Procedures for Rules of Origin referred to
in Article 50.
5. A certificate of origin shall be completed in the
English language.
6. An issued certificate of origin shall be applicable to
a single importation of an originating good of the
exporting Party into the importing Party and be valid for
12 months from the date of issuance.
7. Where the exporter of a good is not the producer of
the good in the exporting Party, the exporter may request a
certificate of origin on the basis of:
(a) a declaration provided by the exporter to the
competent governmental authority of the exporting
Party or its designees based on the information
provided by the producer of the good to that
exporter; or
(b) a declaration voluntarily provided by the
producer of the good directly to the competent
governmental authority of the exporting Party or
its designees by the request of the exporter in
accordance with the applicable laws and
regulations of the exporting Party.
8. A certificate of origin shall be issued only after the
exporter who requests the certificate of origin, or the
producer of a good in the exporting Party referred to in
subparagraph 7(b), proves to the competent governmental
authority of the exporting Party or its designees that the
good to be exported qualifies as an originating good of the
exporting Party.
9. The competent governmental authority of the exporting
Party shall provide the other Party with specimen
signatures and impressions of stamps used in the offices of
the competent governmental authority or its designees.
10. Each Party shall ensure that the competent
governmental authority or its designees shall keep a record
of issued certificate of origin for a period of five years
after the date on which the certificate was issued. Such
record will include all antecedents, which were presented
to prove the qualification as an originating good of the
exporting Party.
Article 42
Obligations regarding Exportations
Each Party shall, in accordance with its laws and
regulations, ensure that the exporter to whom a certificate
of origin has been issued, or the producer of a good in
the exporting Party referred to in subparagraph 7(b) of
Article 41:
(a) shall notify in writing the competent
governmental authority of the exporting Party or
its designees without delay when such exporter or
producer knows that such good does not qualify as
an originating good of the exporting Party; and
(b) shall keep the records relating to the origin of
the good for five years after the date on which
the certificate of origin was issued.
Article 43
Request for Checking of Certificate of Origin
1. For the purposes of determining whether a good
imported from the exporting Party under preferential tariff
treatment qualifies as an originating good of the exporting
Party, the customs authority of the importing Party may
request information relating to the origin of the good from
the competent governmental authority of the exporting Party
on the basis of the certificate of origin.
2. For the purposes of paragraph 1, the competent
governmental authority of the exporting Party shall, in
accordance with the laws and regulations of the Party,
provide the information requested in a period not exceeding
six months after the date of receipt of the request.
If the customs authority of the importing Party
considers necessary, it may require additional information
relating to the origin of the good. If additional
information is requested by the customs authority of the
importing Party, the competent governmental authority of
the exporting Party shall, in accordance with the laws and
regulations of the exporting Party, provide the information
requested in a period not exceeding four months after the
date of receipt of the request.
3. For the purposes of paragraph 2, the competent
governmental authority of the exporting Party may request
the exporter to whom the certificate of origin has been
issued, or the producer of the good in the exporting Party
referred to in subparagraph 7(b) of Article 41, to provide
the former with the information requested.
Article 44
Verification Visit
1. If the customs authority of the importing Party is not
satisfied with the outcome of the request for checking
pursuant to Article 43, it may request the exporting Party:
40
(a) to collect and provide information relating to
the origin of the good and check, for that
purpose, the facilities used in the production of
the good, through a visit by the competent
governmental authority of the exporting Party
along with the customs authority of the importing
Party, which may be accompanied by other
government officials with necessary expertise of
the importing Party, to the premises of the
exporter to whom the certificate of origin has
been issued, or the producer of the good in the
exporting Party referred to in subparagraph 7(b)
of Article 41; and
(b) during or after the visit, to provide information
relating to the origin of the good in the
possession of the competent governmental
authority of the exporting Party or its
designees.
2. When requesting the exporting Party to conduct a visit
pursuant to paragraph 1 or 6, the customs authority of the
importing Party shall deliver a written communication with
such request to the exporting Party at least 40 days in
advance of the proposed date of the visit, the receipt of
which is to be confirmed by the exporting Party. The
competent governmental authority of the exporting Party
shall request the written consent of the exporter, or the
producer of the good in the exporting Party, whose premises
are to be visited.
3. The communication referred to in paragraph 2 shall
include:
(a) the identity of the customs authority of the
importing Party issuing the communication;
(b) the name of the exporter, or the producer of the
good in the exporting Party, whose premises are
requested to be visited;
(c) the proposed date and place of the visit;
(d) the objective and scope of the proposed visit,
including specific reference to the good subject
of the verification referred to in the
certificate of origin; and
(e) the names and titles of the officials of the
customs authority and other government officials
with necessary expertise of the importing Party
to be present during the visit.
4. The exporting Party shall respond in writing to the
importing Party, within 30 days of the receipt of the
communication referred to in paragraph 2, if it accepts or
refuses to conduct the visit requested pursuant to
paragraph 1 or 6.
5. The competent governmental authority of the exporting
Party shall, in accordance with the laws and regulations of
the Party, provide within 45 days or any other mutually
agreed period from the last day of the visit, to the
customs authority of the importing Party the information
obtained pursuant to paragraph 1 or 6.
6. (a) In cases where the customs authority of the
importing Party considers as exceptional, that
customs authority may, before or during the
request for checking referred to in Article 43,
put forward the exporting Party a request
referred to in paragraph 1.
(b) Where the request referred to in subparagraph (a)
is made, Article 43 shall not be applied.
Article 45
Determination of Origin
and Preferential Tariff Treatment
1. The customs authority of the importing Party may deny
preferential tariff treatment to a good for which an
importer claims preferential tariff treatment where the
good does not qualify as an originating good of the
exporting Party or where the importer fails to comply with
any of the relevant requirements of this Chapter.
2. The competent governmental authority of the exporting
Party shall, when it cancels the decision to issue the
certificate of origin, promptly notify the cancellation to
the exporter to whom the certificate of origin has been
issued, and to the customs authority of the importing Party
except where the certificate has been returned to the
competent governmental authority. The customs authority of
the importing Party may determine that the good does not
qualify as an originating good of the exporting Party and
may deny preferential tariff treatment where it receives
the notification.
3. The customs authority of the importing Party may
determine that a good does not qualify as an originating
good of the exporting Party and may deny preferential
tariff treatment, and a written determination thereof shall
be sent to the competent governmental authority of the
exporting Party:
(a) where the competent governmental authority of the
exporting Party fails to respond to the request
within the period referred to in paragraph 2 of
Article 43 or paragraph 5 of Article 44;
(b) where the exporting Party refuses to conduct a
visit, or that Party fails to respond to the
communication referred to in paragraph 2 of
Article 44 within the period referred to in
paragraph 4 of Article 44; or
(c) where the information provided to the customs
authority of the importing Party pursuant to
Article 43 or 44, is not sufficient to prove that
the good qualifies as an originating good of the
exporting Party.
4. After carrying out the procedures outlined in Article
43 or 44 as the case may be, the customs authority of the
importing Party shall provide the competent governmental
authority of the exporting Party with a written
determination of whether or not the good qualifies as an
originating good of the exporting Party, including findings
of fact and the legal basis for the determination. The
competent governmental authority of the exporting Party
shall inform such determination by the customs authority of
the importing Party to the exporter, or the producer of the
good in the exporting Party, whose premises were subject to
the visit referred to in Article 44.
Article 46
Confidentiality
1. Each Party shall maintain, in accordance with its laws
and regulations, the confidentiality of information
provided to it as confidential pursuant to this Chapter,
and shall protect that information from disclosure that
could prejudice the competitive position of the persons
providing the information.
2. Information obtained by the customs authority of the
importing Party pursuant to this Chapter:
(a) may only be used by such authority for the
purposes of this Chapter; and
(b) shall not be used by the importing Party in any
criminal proceedings carried out by a court or a
judge, unless the information is requested to the
exporting Party and provided to the importing
Party, through the diplomatic channels or other
channels established in accordance with the
applicable laws of the exporting Party.
Article 47
Penalties and Measures against False Declaration
1. Each Party shall establish or maintain, in accordance
with its laws and regulations, appropriate penalties or
other sanctions against its exporters to whom a certificate
of origin has been issued and the producers of the good in
the exporting Party referred to in subparagraph 7(b) of
Article 41, for providing false declaration or documents to
the competent governmental authority of the exporting Party
or its designees prior to the issuance of certificate of
origin.
2. Each Party shall, in accordance with its laws and
regulations, take measures which it considers appropriate
against its exporters to whom a certificate of origin has
been issued and the producers of the good in the exporting
Party referred to in subparagraph 7(b) of Article 41, for
failing to notify in writing to the competent governmental
authority of the exporting Party or its designees without
delay after having known, after the issuance of certificate
of origin, that such good does not qualify as an
originating good of the exporting Party.
Article 48
Miscellaneous
1. Communications between the importing Party and the
exporting Party shall be conducted in the English language.
2. For the application of the relevant product specific
rules set out in Annex 2 and the determination of origin,
the Generally Accepted Accounting Principles in the
exporting Party shall be applied.
Article 49
Sub-Committee on Rules of Origin
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Rules of Origin (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and making appropriate recommendations,
as necessary, to the Joint Committee on:
(i) the implementation and operation of this
Chapter;
(ii) any amendments to Annex 2 or 3, proposed by
either Party; and
(iii) the Operational Procedures for Rules of
Origin referred to in Article 50;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Article 50
Operational Procedures for Rules of Origin
Upon the date of entry into force of this Agreement,
the Joint Committee shall adopt the Operational Procedures
for Rules of Origin that provide detailed regulations
pursuant to which the customs authorities, the competent
governmental authorities and other relevant authorities of
the Parties shall implement their functions under this
Chapter.
Chapter 4
Customs Procedures
Article 51
Scope
1. This Chapter shall apply to customs procedures
required for the clearance of goods traded between the
Parties.
2. This Chapter shall be implemented by the Parties in
accordance with the laws and regulations of each Party and
within the competence and available resources of their
respective customs authorities.
Article 52
Definition
For the purposes of this Chapter, the term “customs
laws” means the statutory and regulatory provisions
relating to the importation, exportation, movement or
storage of goods, the administration and enforcement of
which are specifically charged to the customs authority of
each Party, and any regulations made by the customs
authority of each Party under its statutory power.
Article 53
Transparency
1. Each Party shall ensure that all relevant information
of general application pertaining to its customs laws is
publicly available.
2. When information that has been made available must be
amended due to changes in its customs laws, each Party
shall endeavor to make the revised information readily
available sufficiently in advance of the entry into force
of the changes to enable interested persons to take account
of them, unless advance notice is precluded.
3. Each Party shall, wherever appropriate, provide, as
quickly and as accurately as possible, information relating
to the specific customs matters raised by any interested
person of the Parties and pertaining to its customs laws.
The Party shall endeavor to supply any other pertinent
information which it considers the interested person should
be made aware of.
Article 54
Customs Clearance
1. Both Parties shall apply their respective customs
procedures in a predictable, consistent and transparent
manner.
2. For the accomplishment of the purposes of paragraph 1,
each Party shall:
(a) make use of information and communications
technology;
(b) simplify its customs procedures;
(c) harmonize its customs procedures, as far as
possible, with relevant international standards
and recommended practices such as those made
under the auspices of the Customs Co-operation
Council; and
(d) promote cooperation, wherever appropriate,
between its customs authority and:
(i) other national authorities of the Party; and
(ii) the trading communities of the Party.
3. Each Party shall provide affected parties with
accessible processes of administrative and judicial review
in relation to the action concerning the customs matters
taken by the Party.
Article 55
Cooperation and Exchange of Information
1. The Parties shall cooperate and exchange information
with each other, in the field of customs procedures,
including their enforcement against the trafficking of
restricted and prohibited goods and the importation and
exportation of goods suspected of infringing intellectual
property rights.
2. Such cooperation and exchange of information shall be
implemented as provided for in the Implementing Agreement.
Article 56
Sub-Committee on Customs Procedures
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Customs Procedures (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing the implementation and operation of
this Chapter;
(b) identifying areas, relating to this Chapter, to
be improved for facilitating trade between the
Parties;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
2. Further to paragraph 2 of Article 15, the composition
of the Sub-Committee shall be specified in the Implementing
Agreement.
Chapter 5
Investment
Article 57
Scope
1. This Chapter shall apply to measures adopted or
maintained by a Party relating to:
(a) investors of the other Party; and
(b) investments of investors of the other Party in
the Area of the former Party.
2. In the event of any inconsistency between this Chapter
and Chapter 6:
(a) with respect to matters covered by Articles 59,
60 and 63, Chapter 6 shall prevail to the extent
of inconsistency; and
(b) with respect to matters not falling under
subparagraph (a), this Chapter shall prevail to
the extent of inconsistency.
3. This Chapter shall not apply to measures affecting the
movement of natural persons of a Party.
Article 58
Definitions
For the purposes of this Chapter:
(a) the term “enterprise” means any legal person or
any other entity duly constituted or organized
under applicable laws and regulations, whether
for profit or otherwise, and whether privately owned
or controlled or governmentally-owned or
controlled, including any corporation, trust,
partnership, joint venture, sole proprietorship,
organization or company;
(b) an enterprise is:
(i) “owned” by an investor if more than 50
percent of the equity interests in it is
beneficially owned by the investor; and
(ii) “controlled” by an investor if the investor
has the power to name a majority of its
directors or otherwise to legally direct its
actions;
(c) the term “enterprise of the other Party” means an
enterprise constituted or organized under the
applicable laws and regulations of the other
Party;
(d) the term “financial services” means financial
services as defined in subparagraph 2(a)(i) of
Section 1 of Annex 7;
(e) the term “freely convertible currencies” means
currencies which are, in fact, widely used to
make payments for international transactions and
are widely traded in the principal exchange
markets;
(f) the term “investments” means every kind of asset
invested by an investor, in accordance with
applicable laws and regulations, including,
though not exclusively:
(i) an enterprise and a branch of an enterprise;
(ii) shares, stocks or other forms of equity
participation in an enterprise, including
rights derived there from;
(iii) bonds, debentures, loans and other forms of
debt, including rights derived there from;
(iv) rights under contracts, including turnkey,
construction, management, production or
revenue-sharing contracts;
(v) claims to money and claims to any
performance under contract having a
financial value;
(vi) intellectual property rights, including
copyrights, patent rights and rights
relating to utility models, trademarks,
industrial designs, layout-designs of
integrated circuits, new varieties of
plants, trade names, indications of source
or geographical indications and undisclosed
information;
(vii) rights conferred pursuant to laws and
regulations or contracts such as
concessions, licenses, authorizations and
permits; and
(viii) any other tangible and intangible, movable
and immovable property, and any related
property rights, such as leases, mortgages,
liens and pledges;
Note 1: Investments also include amounts yielded by
investments, in particular, profit, interest,
capital gains, dividends, royalties and fees.
A change in the form in which assets are
invested does not affect their character as
investments.
Note 2: For the purposes of subparagraphs (ii) and
(iii), a Party may, on a non-discriminatory
basis, exclude portfolio investments which
are determined by the use of the nondiscriminatory
and objective criteria adopted
by the Party.
(g) the term “investment activities” means
establishment, acquisition, expansion,
management, conduct, operation, maintenance, use,
enjoyment and sale or other disposition of
investments;
(h) the term “investor of the other Party” means a
national or an enterprise of the other Party;
(i) the term “national of the other Party” means a
natural person having the nationality of the
other Party in accordance with the applicable
laws and regulations of the other Party;
(j) the term “New York Convention” means the United
Nations Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, done at
New York, June 10, 1958; and
(k) the term “transfers” means transfers and
international payments.
Article 59
National Treatment
1. Each Party shall accord to investors of the other
Party and to their investments treatment no less favourable
than that it accords in like circumstances to its own
investors and to their investments with respect to
investment activities.
2. Notwithstanding paragraph 1, each Party may prescribe
special formalities in connection with investment
activities of investors of the other Party in its Area,
provided that such formalities do not materially impair the
protection afforded by the former Party to investors of the
other Party and to their investments pursuant to this Chapter.
Article 60
Most-Favoured-Nation Treatment
Each Party shall accord to investors of the other
Party and to their investments treatment no less favourable
than that it accords in like circumstances to investors of
a non-Party and to their investments with respect to
investment activities.
Article 61
General Treatment
Each Party shall accord to investments of investors of
the other Party fair and equitable treatment and full
protection and security.
Article 62
Access to the Courts of Justice
Each Party shall in its Area accord to investors of
the other Party treatment no less favourable than that it
accords in like circumstances to its own investors or
investors of a non-Party, with respect to access to its
courts of justice and administrative tribunals and agencies
in all degrees of jurisdiction, both in pursuit and in
defense of such investors’ rights.
Article 63
Prohibition of Performance Requirements
1. Neither Party shall impose or enforce any of the
following requirements, in connection with investment
activities in its Area of an investor of the other Party:
(a) to export a given level or percentage of goods or
services;
(b) to achieve a given level or percentage of
domestic content;
(c) to purchase, use or accord a preference to goods
produced or services provided in its Area, or to
purchase goods or services from natural or legal
persons or any other entity in its Area;
(d) to relate in any way the volume or value of
imports to the volume or value of exports or to
the amount of foreign exchange inflows associated
with investments of the investor;
(e) to restrict sales of goods or services in its
Area that investments of the investor produce or
provide by relating such sales in any way to the
volume or value of its exports or foreign
exchange earnings;
(f) to appoint, as executives or members of board of
directors, individuals of any particular
nationality;
(g) to locate the headquarters of the investor for a
specific region or the world market in its Area;
(h) to achieve a given level or value of research and
development in its Area; or
(i) to supply to a specific region or the world
market exclusively from its Area, one or more of
the goods that the investor produces or the
services that the investor provides.
2. Paragraph 1 does not preclude either Party from
conditioning the receipt or continued receipt of an
advantage, in connection with investment activities in its
Area of an investor of the other Party, on compliance with
any of the requirements set forth in subparagraphs 1 (g)
through (i).
Article 64
Reservations and Exceptions
1. Articles 59, 60 and 63 shall not apply to:
(a) any non-conforming measure that is maintained by
the following on the date of entry into force of
this Agreement, with respect to the sectors or
matters specified in Annex 4:
(i) the central government of a Party; or
(ii) a prefecture of Japan or a province of
Indonesia;
(b) any non-conforming measure that is maintained by
a local government other than a prefecture and a
province referred to in subparagraph (a)(ii) on
the date of entry into force of this Agreement;
(c) the continuation or prompt renewal of any nonconforming
measure referred to in subparagraphs
(a) and (b); or
(d) an amendment or modification to any nonconforming
measure referred to in subparagraphs
(a) and (b), provided that the amendment or
modification does not decrease the conformity of
the measure, as it existed immediately before the
amendment or modification, with Articles 59, 60
and 63.
2. Each Party shall, on the date of entry into force of
this Agreement, notify the other Party of the following
information on any non-conforming measure referred to in
subparagraph 1(a):
(a) the sector or matter, with respect to which the
measure is maintained;
(b) the domestic or international industry
classification codes, where applicable, to which
the measure relates;
(c) the level of the government which maintains the
measure;
(d) the obligations under this Agreement with which
the measure does not conform;
(e) the legal source of the measure; and
(f) the succinct description of the measure.
3. Articles 59, 60 and 63 shall not apply to any measure
that a Party adopts or maintains with respect to the
sectors or matters specified in Annex 5.
4. Where a Party maintains any non-conforming measure on
the date of entry into force of this Agreement with respect
to the sectors or matters specified in Annex 5, the Party
shall, on the same date, notify the other Party of the
following information on the measure:
(a) the sector or matter, with respect to which the
measure is maintained;
(b) the domestic or international industry
classification codes, where applicable, to which
the measure relates;
(c) the obligations under this Agreement with which
the measure does not conform;
(d) the legal source of the measure; and
(e) the succinct description of the measure.
5. Neither Party shall, under any measure adopted after
the date of entry into force of this Agreement with respect
to the sectors or matters specified in Annex 5, require an
investor of the other Party, by reason of its nationality,
to sell or otherwise dispose of an investment that exists
at the time the measure becomes effective, unless otherwise
specified in the initial approval by the relevant
authority.
6. In cases where a Party makes an amendment or a
modification to any non-conforming measure notified
pursuant to paragraph 2 or 4, or where a Party adopts any
new measure with respect to the sectors or matters
specified in Annex 5, after the date of entry into force of
this Agreement, the Party shall, as soon as possible:
(a) notify the other Party of detailed information on
such amendment, modification or new measure; and
(b) respond, upon the request by the other Party, to
specific questions from the other Party with
respect to such amendment, modification or new
measure.
7. Each Party shall endeavor, where appropriate, to
reduce or eliminate the non-conforming measures that it
adopts or maintains with respect to the sectors or matters
specified in Annexes 4 and 5 respectively.
8. Articles 59 and 60 shall not apply to any measure
covered by the exceptions to, or derogations from,
obligations under Articles 3 and 4 of the TRIPS Agreement,
as specifically provided in Articles 3 through 5 of the
TRIPS Agreement.
9. Articles 59, 60 and 63 shall not apply to any measure
that a Party adopts or maintains with respect to government
procurement.
Article 65
Expropriation and Compensation
1. Neither Party shall expropriate or nationalize
investments in its Area of investors of the other Party or
take any measure tantamount to expropriation or
nationalization (hereinafter referred to in this Chapter as
“expropriation”) except:
(a) for a public purpose;
(b) on a non-discriminatory basis;
(c) in accordance with due process of law and Article
61; and
(d) upon payment of prompt, adequate and effective
compensation pursuant to paragraphs 2 through 4.
2. The compensation shall be equivalent to the fair
market value of the expropriated investments at the time
when the expropriation was publicly announced or when the
expropriation occurred, whichever is the earlier. The fair
market value shall not reflect any change in market value
occurring because the expropriation had become publicly
known earlier.
3. The compensation shall be paid without delay and shall
include interest at a commercially reasonable rate taking
into account the length of time from the time of
expropriation to the time of payment. It shall be
effectively realizable and freely transferable and shall be
freely convertible, at the market exchange rate prevailing
on the date of expropriation, into the currency of the
Party of the investors concerned and freely convertible
currencies.
4. Without prejudice to Article 69, the investors
affected by expropriation shall have a right of access to
the courts of justice or the administrative tribunals or
agencies of the Party making the expropriation to seek a
prompt review of the investors’ case and the amount of
compensation in accordance with the principles set out in
this Article.
Article 66
Protection from Strife
1. Each Party shall accord to investors of the other
Party that have suffered loss or damage relating to their
investments in the Area of the former Party due to armed
conflict or state of emergency such as revolution,
insurrection, civil disturbance or any other similar event
in the Area of that former Party, treatment, as regards
restitution, indemnification, compensation or any other
settlement, that is no less favourable than that it accords
to its own investors or to investors of a non-Party.
2. Any payments as a means of settlement referred to in
paragraph 1 shall be effectively realizable, freely
transferable and freely convertible at the market exchange
rate into the currency of the Party of the investors
concerned and freely convertible currencies.
Article 67
Transfers
1. Each Party shall ensure that all transfers relating to
investments in its Area of an investor of the other Party
may be made freely into and out of its Area without delay.
Such transfers shall include those of:
(a) the initial capital and additional amounts to
maintain or increase investments;
(b) profits, capital gains, dividends, royalties,
interests, fees and other current incomes
accruing from investments;
(c) proceeds from the total or partial sale or
liquidation of investments;
(d) payments made under a contract including loan
payments in connection with investments;
(e) earnings and remuneration of personnel from the
other Party who work in connection with
investments in the Area of the former Party;
(f) payments made in accordance with Articles 65 and
66; and
(g) payments arising out of the settlement of a
dispute under Article 69.
2. Each Party shall further ensure that such transfers
may be made in freely convertible currencies at the market
exchange rate prevailing on the date of each transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may delay
or prevent such transfers through the equitable, nondiscriminatory
and good-faith application of its laws
relating to:
(a) bankruptcy, insolvency or the protection of the
rights of creditors;
(b) issuing, trading or dealing in securities;
(c) criminal or penal offenses; or
(d) ensuring compliance with orders or judgments in
adjudicatory proceedings.
Article 68
Subrogation
1. If a Party or its designated agency makes a payment to
any of its investors under an indemnity, guarantee or
contract of insurance given in respect of an investment of
that investor within the Area of the other Party, the other
Party shall:
(a) recognize the assignment, to the former Party or
its designated agency, of any right or claim of
the investor that formed the basis of such
payment; and
(b) recognize the right of the former Party or its
designated agency to exercise by virtue of
subrogation such right or claim to the same
extent as the original right or claim of the
investor.
2. Articles 65 through 67 shall apply mutatis mutandis as
regards payment to be made to the Party or its designated
agency mentioned in paragraph 1 by virtue of such
assignment of right or claim, and the transfer of such
payment.
Article 69
Settlement of Investment Disputes
between a Party and an Investor of the Other Party
1. For the purposes of this Chapter, an “investment
dispute” is a dispute between a Party and an investor of
the other Party that has incurred loss or damage by reason
of, or arising out of, an alleged breach of any obligation
under this Agreement with respect to the investor and its
investments.
2. An investment dispute shall, as far as possible, be
settled amicably through consultation or negotiation
between an investor who is a party to the investment
dispute (hereinafter referred to in this Article as
“disputing investor”) and the Party that is a party to the
investment dispute (hereinafter referred to in this Article
as “disputing Party”).
3. Nothing in this Article shall be construed so as to
prevent a disputing investor from seeking administrative or
judicial settlement within the disputing Party in
accordance with the laws and regulations of the disputing
Party.
4. If the investment dispute cannot be settled through
consultation or negotiation referred to in paragraph 2
within five months from the date on which the disputing
investor requested for the consultation or negotiation in
writing and if the disputing investor has not submitted the
investment dispute for resolution under courts of justice
or administrative tribunals or agencies, the disputing
investor may submit the investment dispute to one of the
following international conciliations or arbitrations:
(a) conciliation or arbitration in accordance with
the Convention on the Settlement of Investment
Dispute between States and Nationals of Other
States(hereinafter referred to in this Article as
“the ICSID Convention”), so long as the ICSID
Convention is in force between the Parties;
(b) conciliation or arbitration under the Additional
Facility Rules of the International Centre for
Settlement of Investment Disputes, so long as the
ICSID Convention is not in force between the
Parties;
(c) arbitration under the Arbitration Rules of the
United Nations Commission on International Trade
Law, adopted by the United Nations Commission on
International Trade Law on April 28, 1976; and
(d) if agreed with the disputing Party, any
arbitration in accordance with other arbitration
rules.
5. The applicable conciliation or arbitration rules shall
govern the conciliation or arbitration set forth in
paragraph 4 except to the extent modified in this Article.
6. A disputing investor who intends to submit the
investment dispute to conciliation or arbitration pursuant
to paragraph 4 shall give to the disputing Party written
notice of intent to do so at least 90 days before the
investment dispute is submitted. The notice of intent
shall specify:
(a) the name and address of the disputing investor;
(b) the specific measures of the disputing Party at
issue and a brief summary of the factual and
legal basis of the investment dispute sufficient
to present the problem clearly, including the
provisions under this Agreement alleged to have
been breached; and
(c) conciliation or arbitration set forth in
paragraph 4 which the disputing investor will
choose.
7. (a) Each Party hereby consents to the submission of
investment disputes by a disputing investor to
conciliation or arbitration set forth in
paragraph 4.
(b) The consent given by subparagraph (a) and the
submission by a disputing investor of an
investment dispute to conciliation or arbitration
shall satisfy the requirements of:
(i) Chapter II of the ICSID Convention or the
Additional Facility Rules of the
International Centre for Settlement of
Investment Disputes, for written consent of
the parties to a dispute; and
(ii) Article II of the New York Convention for an
agreement in writing.
8. Notwithstanding paragraph 7, no investment dispute may
be submitted to conciliation or arbitration set forth in
paragraph 4, if more than three years have elapsed since
the date on which the disputing investor acquired or should
have first acquired, whichever is the earlier, the
knowledge that the disputing investor had incurred loss or
damage referred to in paragraph 1.
9. Notwithstanding paragraph 4, the disputing investor
may initiate or continue an action that seeks interim
injunctive relief that does not involve the payment of
damages before an administrative tribunal or agency or a
court of justice under the law of the disputing Party.
10. Unless the disputing investor and the disputing Party
(hereinafter referred to in this Article as “the disputing
parties”) agree otherwise, an arbitral tribunal established
under paragraph 4 shall comprise three arbitrators, one
arbitrator appointed by each of the disputing parties and
the third, who shall be the presiding arbitrator, appointed
by agreement of the disputing parties. If the disputing
investor or the disputing Party fails to appoint an
arbitrator or arbitrators within 60 days from the date on
which the investment dispute was submitted to arbitration,
the Secretary-General of the International Centre for
Settlement of Investment Disputes (hereinafter referred to
in this Article as “ICSID”), may be requested by either of
the disputing parties, to appoint the arbitrator or
arbitrators not yet appointed from the ICSID Panel of
Arbitrators subject to the requirements of paragraphs 11
and 12.
11. Unless the disputing parties agree otherwise, the
third arbitrator shall not be a national of either Party,
nor have his or her usual place of residence in either
Party, nor be employed by either of the disputing parties,
nor have dealt with the investment dispute in any capacity.
12. In the case of arbitration referred to in paragraph 4,
each of the disputing parties may indicate up to three
nationalities, the appointment of arbitrators of which is
unacceptable to it. In this event, the Secretary-General
of the ICSID may be requested not to appoint as arbitrator
any person whose nationality is indicated by either of the
disputing parties.
13. Unless the disputing parties agree otherwise, the
arbitration shall be held in a country that is a party to
the New York Convention.
14. An arbitral tribunal established under paragraph 4
shall decide the issues in dispute in accordance with this
Agreement and applicable rules of international law.
15. The disputing Party shall deliver to the other Party:
(a) written notice of the investment dispute
submitted to the arbitration no later than 30
days after the date on which the investment
dispute was submitted; and
(b) copies of all pleadings filed in the arbitration.
16. On written notice to the disputing parties, the Party
which is not the disputing Party may make submissions to
the arbitral tribunal on a question of interpretation of
this Agreement.
17. The arbitral tribunal may order an interim measure of
protection to preserve the rights of the disputing
investor, or to facilitate the conduct of arbitral
proceedings, including an order to preserve evidence in the
possession or control of either of the disputing parties.
The arbitral tribunal shall not order attachment or enjoin
the application of the measure alleged to constitute a
breach referred to in paragraph 1.
18. The award rendered by the arbitral tribunal shall
include:
(a) a judgment whether or not there has been a breach
by the disputing Party of any obligation under
this Agreement with respect to the disputing
investor and its investments; and
(b) a remedy if there has been such breach. The
remedy shall be limited to one or both of the
following:
(i) payment of monetary damages and applicable
interest; and
(ii) restitution of property, in which case the
award shall provide that the disputing Party
may pay monetary damages and any applicable
interest in lieu of restitution.
Costs may also be awarded in accordance with the
applicable arbitration rules.
19. The award rendered in accordance with paragraph 18
shall be final and binding upon the disputing parties. The
disputing Party shall carry out without delay the
provisions of the award and provide in its Area for the
enforcement of the award in accordance with its relevant
laws and regulations.
20. Neither Party shall give diplomatic protection, or
bring an international claim, in respect of an investment
dispute which the other Party and an investor of the former
Party have consented to submit or submitted to arbitration
set forth in paragraph 4, unless the other Party shall have
failed to abide by and comply with the award rendered in
such investment dispute. Diplomatic protection, for the
purposes of this paragraph, shall not include informal
diplomatic exchanges for the sole purpose of facilitating a
settlement of the investment dispute.
21. Annex 6 provides additional provisions with respect to
the settlement of investment disputes.
Article 70
Temporary Safeguard Measures
1. A Party may adopt or maintain measures not conforming
with its obligations under Article 59 relating to crossborder
capital transactions and Article 67:
(a) in the event of serious balance-of-payments and
external financial difficulties or threat
thereof; or
(b) in cases where, in exceptional circumstances,
movements of capital cause or threaten to cause
serious difficulties for macroeconomic management
in particular, monetary and exchange rate
policies.
2. Measures referred to in paragraph 1:
(a) shall be consistent with the Articles of
Agreement of the International Monetary Fund;
(b) shall not exceed those necessary to deal with the
circumstances set out in paragraph 1;
(c) shall be temporary and eliminated as soon as
conditions permit; and
(d) shall be promptly notified to the other Party.
3. Nothing in this Article shall be regarded as altering
the rights enjoyed and obligations undertaken by a Party as
a party to the Articles of Agreement of the International
Monetary Fund.
Article 71
Prudential Measures
1. Notwithstanding any other provisions of this Chapter,
a Party shall not be prevented from taking measures
relating to financial services for prudential reasons,
including measures for the protection of investors,
depositors, policy holders or persons to whom a fiduciary
duty is owed by an enterprise supplying financial services,
or to ensure the integrity and stability of the financial
system.
2. Where such measures do not conform with the provisions
of this Chapter, they shall not be used as a means of
avoiding the Party's commitments or obligations under this
Chapter.
Article 72
Denial of Benefits
1. A Party may deny the benefits of this Chapter to an
investor of the other Party that is an enterprise of the
other Party and to its investments, where the denying Party
establishes that the enterprise is owned or controlled by
an investor of a non-Party and the denying Party:
(a) does not maintain diplomatic relations with the
non-Party; or
(b) adopts or maintains measures with respect to the
non-Party that prohibit transactions with the
enterprise or that would be violated or
circumvented if the benefits of this Chapter were
accorded to the enterprise or to its investments.
2. Subject to prior notification and consultation, a
Party may deny the benefits of this Chapter to an investor
of the other Party that is an enterprise of the other Party
and to its investments, where the denying Party establishes
that the enterprise is owned or controlled by an investor
of a non-Party and the enterprise has no substantial
business activities in the Area of the other Party.
Article 73
Taxation Measures as Expropriation
1. Article 65 shall apply to taxation measures, to the
extent that such taxation measures constitute expropriation
as provided for in paragraph 1 of Article 65.
2. Where Article 65 applies to taxation measures in
accordance with paragraph 1, Articles 62 and 69 shall also
apply in respect of taxation measures.
3. Notwithstanding paragraph 2, no investor may invoke
Article 65 as the basis for an investment dispute under
Article 69, where it has been determined pursuant to
paragraph 4 that the taxation measure is not an
expropriation.
4. The investor shall refer the issue, at the time that
it gives a written notice of intent under paragraph 6 of
Article 69, to the competent authorities of both Parties,
through the contact points referred to in Article 16, to
determine whether such measure is not an expropriation. If
the competent authorities of both Parties do not consider
the issue or, having considered it, fail to determine that
the measure is not an expropriation within a period of five
months of such referral, the investor may submit the
investment dispute to conciliation or arbitration under
Article 69.
5. Paragraphs 2 through 4 shall apply only to taxation
measure taken in the form of or in the applications of the
laws and regulations which are enacted or amended after the
entry into force of this Agreement.
Note: With respect to Indonesia, taxation measures
referred to in this paragraph do not include those
taken by tax administrative authorities in the
applications of the relevant laws and regulations.
6. For the purposes of paragraph 4, the term “competent
authorities” means:
(a) with respect to Japan, the Minister of Finance or
his or her authorized representative, who shall
consider the issue in consultation with the
Minister of Foreign Affairs or his or her
authorized representative; and
(b) with respect to Indonesia, the Minister of
Finance or his or her authorized representative.
Article 74
Environmental Measures
Each Party recognizes that it is inappropriate to
encourage investments by investors of the other Party by
relaxing its environmental measures. To this effect each
Party should not waive or otherwise derogate from such
environmental measures as an encouragement for
establishment, acquisition or expansion of investments in
its Area.
Article 75
Sub-Committee on Investment
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Investment (hereinafter referred to in this
Article as “the Sub-Committee”) established in accordance
with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) reviewing the specific reservations and
exceptions under Article 64;
(c) discussing any issues related to this Chapter;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 6
Trade in Services
Article 76
Scope
1. This Chapter shall apply to measures by a Party
affecting trade in services.
2. This Chapter shall not apply to:
(a) in respect of air transport services, measures
affecting traffic rights, however granted; or to
measures affecting services directly related to
the exercise of traffic rights, other than
measures affecting:
(i) aircraft repair and maintenance services;
(ii) the selling and marketing of air transport
services; and
(iii) computer reservation system services;
(b) cabotage in maritime transport services;
(c) subsidies provided by a Party or a state
enterprise thereof, including grants, government supported
loans, guarantees and insurance;
(d) measures affecting the movement of natural
persons of a Party, unless otherwise provided in
a Schedule of Specific Commitments in Annex 8;
(e) measures affecting natural persons of a Party
seeking access to employment market of the other
Party, or measures regarding nationality, or
residence or employment on a permanent basis; and
(f) government procurement.
3. Annex 7 provides supplementary provisions to this
Chapter on financial services, including scope and
definitions.
Article 77
Definitions
For the purposes of this Chapter:
(a) the term “aircraft repair and maintenance
services” means such activities when undertaken
on an aircraft or a part thereof while it is
withdrawn from service and does not include so called
line maintenance;
(b) the term “commercial presence” means any type of
business or professional establishment, including
through:
(i) the constitution, acquisition or maintenance
of a juridical person; or
(ii) the creation or maintenance of a branch or a
representative office,
within the Area of a Party for the purposes of
supplying services;
(c) the term “computer reservation system services”
means services provided by computerized systems
that contain information about air carriers’
schedules, availability, fares and fare rules,
through which reservations may be made or tickets
may be issued;
(d) the term “juridical person” means any legal
entity duly constituted or otherwise organized
under applicable law, whether for profit or
otherwise, and whether privately-owned or
governmentally-owned, including any corporation,
trust, partnership, joint venture, sole
proprietorship or association;
(e) the term “juridical person of the other Party”
means a juridical person which is either:
(i) constituted or otherwise organized under the
law of the other Party; or
(ii) in the case of the supply of a service
through commercial presence, owned or
controlled by:
(A) natural persons of the other Party; or
(B) juridical persons of the other Party
identified under subparagraph (i);
(f) a juridical person is:
(i) “owned” by persons of a Party or a non-Party
if more than 50 percent of the equity
interests in it is beneficially owned by
such persons;
(ii) “controlled” by persons of a Party or a non-
Party if such persons have the power to name
a majority of its directors or otherwise to
legally direct its actions; and
(iii) “affiliated” with another person when it
controls, or is controlled by, that other
person; or when it and the other person are
both controlled by the same person;
(g) the term “measure” means any measure, whether in
the form of a law, regulation, rule, procedure,
decision, administrative action or any other
form;
Note: The term “measure” shall include taxation
measures to the extent covered by the
GATS.
(h) the term “measure by a Party” means any measure
taken by:
(i) central or local governments and authorities
of a Party; and
(ii) non-governmental bodies in the exercise of
powers delegated by central or local
governments or authorities of a Party;
(i) the term “measures by a Party affecting trade in
services” includes measures by a Party in respect
of:
(i) the purchase, payment or use of services;
(ii) the access to and use of, in connection with
the supply of services, services which are
required by the Party to be offered to the
public generally; and
(iii) the presence, including commercial presence,
of persons of the other Party for the supply
of services in the Area of the former Party;
(j) the term “monopoly supplier of a service” means
any person, public or private, which in the
relevant market of a Party is authorized or
established formally or in effect by that Party
as the sole supplier of that service;
(k) the term “natural person of a Party” means a
natural person who resides in a Party or
elsewhere and who is a national of the Party
under the law of the Party;
(l) the term “person” means either a natural person
or a juridical person;
(m) the term “service” includes any service in any
sector except a service supplied in the exercise
of governmental authority;
(n) the term “service consumer” means any person that
receives or uses services;
(o) the term “services of the other Party” means
services which are supplied:
(i) from or in the Area of the other Party, or
in the case of maritime transport services,
by a vessel registered under the law of the
other Party, or by a person of the other
Party which supplies such services through
the operation of a vessel or its use in
whole or in part; or
(ii) in the case of the supply of services
through commercial presence or through the
presence of natural persons, by service
suppliers of the other Party;
(p) the term “service supplied in the exercise of
governmental authority” means any service which
is supplied neither on a commercial basis nor in
competition with one or more service suppliers;
(q) the term “service supplier” means any person that
seeks to supply or supplies a service;
Note: Where the service is not supplied directly
by a juridical person but through other
forms of commercial presence such as a
branch or a representative office, the
service supplier (i.e. the juridical
person) shall, nonetheless, through such
presence be accorded the treatment
provided for service suppliers under this
Chapter. Such treatment shall be extended
to the presence through which the service
is supplied and need not be extended to
any other parts of the supplier located
outside the Area of a Party where the
service is supplied.
(r) the term “state enterprise” means an enterprise
owned or controlled by the Government of a Party;
(s) the term “supply of a service” includes the
production, distribution, marketing, sale and
delivery of a service;
(t) the term “the selling and marketing of air
transport services” means opportunities for the
air carrier concerned to sell and market freely
its air transport services including all aspects
of marketing such as market research, advertising
and distribution. These activities do not
include the pricing of air transport services nor
the applicable conditions;
(u) the term “trade in services” means the supply of
services:
(i) from the Area of a Party into the Area of
the other Party (“cross-border supply
mode”);
(ii) in the Area of a Party to the service
consumer of the other Party (“consumption
abroad mode”);
(iii) by a service supplier of a Party, through
commercial presence in the Area of the other
Party (“commercial presence mode”); and
(iv) by a service supplier of a Party, through
presence of natural persons of that Party in
the Area of the other Party (“presence of
natural persons mode”); and
(v) the term “traffic rights” means the rights for
scheduled and non-scheduled services to operate
and/or to carry passengers, cargo and mail for
remuneration or hire from, to, within, or over a
Party, including points to be served, routes to
be operated, types of traffic to be carried,
capacity to be provided, tariffs to be charged
and their conditions, and criteria for
designation of airlines, including such criteria
as number, ownership and control.
Article 78
Market Access
1. With respect to market access through the modes of
supply defined in subparagraph (u) of Article 77, each
Party shall accord services and service suppliers of the
other Party treatment no less favourable than that provided
for under the terms, limitations and conditions agreed
and specified in its Schedule of Specific Commitments in
Annex 8.
Note: If a Party undertakes a market-access commitment in
relation to the supply of a service through the mode
of supply referred to in subparagraph (u)(i) of
Article 77 and if the cross-border movement of
capital is an essential part of the service itself,
that Party is thereby committed to allow such
movement of capital. If a Party undertakes a
market-access commitment in relation to the supply
of a service through the mode of supply referred to
in subparagraph (u)(iii) of Article 77, it is
thereby committed to allow related transfers of
capital into its Area.
2. In sectors where market-access commitments are
undertaken, the measures which a Party shall not maintain
or adopt either on the basis of a regional subdivision or
on the basis of its entire Area, unless otherwise specified
in its Schedule of Specific Commitments in Annex 8, are
defined as:
(a) limitations on the number of service suppliers
whether in the form of numerical quotas,
monopolies, exclusive service suppliers or the
requirements of an economic needs test;
(b) limitations on the total value of service
transactions or assets in the form of numerical
quotas or the requirement of an economic needs
test;
(c) limitations on the total number of service
operations or on the total quantity of service
output expressed in terms of designated numerical
units in the form of quotas or the requirement of
an economic needs test;
Note: This subparagraph does not cover measures
of a Party which limit inputs for the
supply of services.
(d) limitations on the total number of natural
persons that may be employed in a particular
service sector or that a service supplier may
employ and who are necessary for, and directly
related to, the supply of a specific service in
the form of numerical quotas or the requirement
of an economic needs test;
(e) measures which restrict or require specific types
of legal entity or joint venture through which a
service supplier may supply a service; and
(f) limitations on the participation of foreign
capital in terms of maximum percentage limit on
foreign shareholding or the total value of
individual or aggregate foreign investment.
Article 79
National Treatment
1. In the sectors inscribed in its Schedule of Specific
Commitments in Annex 8, and subject to any conditions and
qualifications set out therein, each Party shall accord to
services and service suppliers of the other Party, in
respect of all measures affecting the supply of services,
treatment no less favourable than that it accords to its
own like services and service suppliers.
Note: Specific commitments assumed under this Article
shall not be construed to require either Party to
compensate for any inherent competitive
disadvantages which result from the foreign
character of the relevant services or service
suppliers.
2. A Party may meet the requirement of paragraph 1 by
according to services and service suppliers of the other
Party, either formally identical treatment or formally
different treatment to that it accords to its own like
services and service suppliers.
3. Formally identical or formally different treatment
shall be considered to be less favourable if it modifies
the conditions of competition in favour of services or
service suppliers of the Party which accords such treatment
compared to like services or service suppliers of the other
Party.
4. A Party shall not invoke the preceding paragraphs
under Chapter 14 with respect to a measure of the other
Party that falls within the scope of an international
agreement between the Parties relating to the avoidance of
double taxation.
Article 80
Additional Commitments
The Parties may negotiate commitments with respect to
measures affecting trade in services not subject to
scheduling under Articles 78 and 79, including those
regarding qualifications, standards or licensing matters.
Such commitments shall be inscribed in a Party’s Schedule
of Specific Commitments in Annex 8.
Article 81
Schedule of Specific Commitments
1. With respect to sectors or sub-sectors where specific
commitments are undertaken by each Party, its Schedule of
Specific Commitments in Annex 8 shall specify:
(a) terms, limitations and conditions on market
access;
(b) conditions and qualifications on national
treatment;
(c) undertakings relating to additional commitments;
and
(d) where appropriate, the time-frame for
implementation of such commitments.
2. Measures inconsistent with both Articles 78 and 79
shall be inscribed in the column relating to Article 78.
In this case the inscription will be considered to provide
a condition or qualification to Article 79 as well.
3. With respect to sectors or sub-sectors where specific
commitments are undertaken in Annex 8 and which are
indicated with “SS”, any terms, limitations, conditions and
qualifications, referred to in subparagraphs 1(a) and (b),
shall be limited to those based on non-conforming measures,
which are in effect on the date of entry into force of this
Agreement.
4. With respect to sectors or sub-sectors where specific
commitments are undertaken by a Party in Annex 8 and which
are indicated with “S”, any terms, limitations, conditions
and qualifications on market access or national treatment,
applied to a service supplier of the other Party on the
date of entry into force of this Agreement, shall not be
changed or modified so as to become more restrictive to
such a service supplier.
Note: With regard to the rights given to the service
supplier under the above mentioned terms,
limitations, conditions and qualifications, this
paragraph shall apply to the same extent as the
rights that the service supplier has already
exercised.
Article 82
Most-Favoured-Nation Treatment
1. Each Party shall accord to services and service
suppliers of the other Party treatment no less favourable
than that it accords to like services and service suppliers
of any non-Party.
2. Paragraph 1 shall not apply to any measure by a Party
with respect to sectors, sub-sectors or activities, as set
out in its Schedule in Annex 9.
Article 83
Authorization, Licensing or Qualification
With a view to ensuring that any measure by a Party
relating to the authorization, licensing or qualification
of service suppliers of the other Party does not constitute
an unnecessary barrier to trade in services, each Party
shall endeavor to ensure that such measure:
(a) is based on objective and transparent criteria,
such as the competence and ability to supply
services;
(b) is not more burdensome than necessary to ensure
the quality of services; and
(c) does not constitute a disguised restriction on
the supply of services.
Article 84
Mutual Recognition
1. A Party may recognize the education or experience
obtained, requirements met, or licenses or certifications
granted in the other Party for the purposes of the
fulfillment, in whole or in part, of its standards or
criteria for the authorization, licensing or certification
of service suppliers of the other Party.
2. Recognition referred to in paragraph 1, which may be
achieved through harmonization or otherwise, may be based
upon an agreement or arrangement between the Parties or may
be accorded unilaterally.
3. Where a Party recognizes, by agreement or arrangement
between the Party and a non-Party or unilaterally, the
education or experience obtained, requirements met or
licenses or certifications granted in the non-Party:
(a) nothing in Article 82 shall be construed to
require the Party to accord such recognition to
the education or experience obtained,
requirements met or licenses or certifications
granted in the other Party; and
(b) the Party shall accord the other Party an
adequate opportunity to demonstrate that the
education or experience obtained, requirements
met or licenses or certifications granted in the
other Party should also be recognized.
Article 85
Transparency
The competent authorities referred to in paragraph 2
of Article 3 shall, upon request by service suppliers of
the other Party, promptly respond to specific questions
from, and provide information to, the service suppliers
with respect to matters referred to in paragraph 1 of
Article 3 through the contact points referred to in Article 16.
Note: The information provided by the Parties under this
Article will be supplied solely for the purposes of
transparency and shall not be construed to affect
any rights and obligations of the Parties under this
Chapter.
Article 86
Monopolies and Exclusive Service Suppliers
1. Each Party shall ensure that any monopoly supplier of
a service in its Area does not, in the supply of the
monopoly service in the relevant market, act in a manner
inconsistent with the Party’s commitments under this
Chapter.
2. Where a Party’s monopoly supplier competes, either
directly or through an affiliated juridical person, in the
supply of a service outside the scope of its monopoly
rights and which is subject to that Party’s specific
commitments, the Party shall ensure that such a supplier
does not abuse its monopoly position to act in the Area of
the Party in a manner inconsistent with such commitments.
3. The provisions of this Article shall also apply to
cases of exclusive service suppliers, where a Party,
formally or in effect:
(a) authorizes or establishes a small number of
service suppliers; and
(b) substantially prevents competition among those
suppliers in its Area.
Article 87
Payments and Transfers
1. Except under the circumstances envisaged in Article
88, a Party shall not apply restrictions on international
transfers and payments for current transactions relating to
trade in services.
2. Nothing in this Chapter shall affect the rights and
obligations of the Parties as members of the International
Monetary Fund under the Articles of Agreement of the
International Monetary Fund, including the use of exchange
actions which are in conformity with the Articles of
Agreement of the International Monetary Fund, provided that
a Party shall not impose restrictions on any capital
transactions inconsistently with its commitments under this
Chapter regarding such transactions, except under Article
88, or at the request of the International Monetary Fund.
Article 88
Restrictions to Safeguard the Balance of Payments
1. In the event of serious balance-of-payments and
external financial difficulties or threat thereof, a Party
may adopt or maintain restrictions on trade in services,
including on payments or transfers for transactions.
2. The restrictions referred to in paragraph 1:
(a) shall ensure that the other Party is treated as
favourably as any non-Party;
(b) shall be consistent with the Articles of
Agreement of the International Monetary Fund;
(c) shall avoid unnecessary damage to the commercial,
economic and financial interests of the other
Party;
(d) shall not exceed those necessary to deal with the
circumstances described in paragraph 1; and
(e) shall be temporary and be phased out
progressively as the situation specified in
paragraph 1 improves.
3. In determining the incidence of such restrictions, a
Party may give priority to the supply of services which are
more essential to its economic or development programs.
However, such restrictions shall not be adopted or
maintained for the purposes of protecting a particular
service sector.
Article 89
Emergency Safeguard Measures
1. The Parties shall take note of the multilateral
negotiations on the question of emergency safeguard
measures based on the principle of non-discrimination
pursuant to Article X of the GATS. Upon the conclusion of
such multilateral negotiations, the Parties shall conduct a
review for the purpose of discussing appropriate amendments
to this Agreement based on the results of such multilateral
negotiations.
2. In the event that the implementation of this Agreement
causes substantial adverse impact to a Party in a specific
service sector prior to the conclusion of the multilateral
negotiations referred to in paragraph 1, the Party may
request consultations with the other Party for the purposes
of taking appropriate measures to address such adverse
impact. The Parties shall take into account the
circumstances of the particular case in such consultations.
Article 90
Denial of Benefits
1. A Party may deny the benefits of this Chapter to a
service supplier of the other Party that is a juridical
person of the other Party, where the denying Party
establishes that the juridical person is owned or
controlled by persons of a non-Party, and the denying
Party:
(a) does not maintain diplomatic relations with the
non-Party; or
(b) adopts or maintains measures with respect to the
non-Party that prohibit transactions with the
juridical person or that would be violated or
circumvented if the benefits of this Chapter were
accorded to the juridical person.
2. Subject to prior notification and consultation, a
Party may deny the benefits of this Chapter to a service
supplier of the other Party that is a juridical person of
the other Party, where the denying Party establishes that
the juridical person is owned or controlled by persons of a
non-Party and has no substantial business activities in the
Area of the other Party.
Article 91
Sub-Committee on Trade in Services
For the purposes of effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Trade in Services (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 7
Movement of Natural Persons
Article 92
Scope
1. This Chapter shall apply to measures affecting the
movement of natural persons of a Party who enter the other
Party and fall under one of the categories referred to in
Annex 10.
2. This Chapter shall not apply to measures affecting
natural persons of a Party seeking access to employment
market of the other Party, nor shall it apply to measures
regarding nationality, or residence or employment on a
permanent basis.
3. This Chapter shall not prevent a Party from applying
measures to regulate the entry of natural persons of the
other Party into, or their temporary stay in, the former
Party, including those measures necessary to protect the
integrity of, and to ensure the orderly movement of natural
persons across, its borders, provided that such measures
are not applied in such a manner as to nullify or impair
the benefits accruing to the other Party under the terms of
specific commitments set out in Annex 10.
Note: The sole fact of requiring a visa or its
equivalent for natural persons of a certain
nationality or citizenship and not for those of
others shall not be regarded as nullifying or
impairing benefits under specific commitments
set out in Annex 10.
Article 93
Definition
For the purposes of this Chapter, the term “natural
persons of a Party” means natural persons who reside in a
Party or elsewhere and who under the law of the Party are
nationals of the Party.
Article 94
Specific Commitments
1. Each Party shall grant entry and temporary stay to
natural persons of the other Party in accordance with this
Chapter including the terms of the categories in Annex 10,
provided that the natural persons comply with the laws and
regulations related to movement of natural persons of the
former Party applicable to entry and temporary stay which
are not inconsistent with the provisions of this Chapter.
2. Each Party shall, in accordance with its laws and
regulations, issue proper travel documents necessary for
immediate return to the Party, to the natural persons of
the Party who stay in the other Party based on the grant of
entry and temporary stay under paragraph 1, where such
persons are required to leave the other Party in accordance
with the laws and regulations of the other Party which are
not inconsistent with the provisions of this Chapter.
3. Each Party may require a natural person of the other
Party to obtain an appropriate visa or its equivalent prior
to entry and temporary stay under paragraph 1.
4. Neither Party shall impose or maintain any limitations
on the number of granting entry and temporary stay under
paragraph 1, unless otherwise specified in Annex 10.
Article 95
Requirements and Procedures
1. Each Party shall establish and make publicly available
requirements and procedures for application for a renewal
of the period of temporary stay, a change of status of
temporary stay or an issuance of a work permit for a
natural person of the other Party who has been granted
entry and temporary stay under paragraph 1 of Article 94.
2. Each Party shall endeavor to provide, upon request by
a natural person of the other Party, information on
requirements and procedures referred to in paragraph 1.
3. Each Party shall, in accordance with its laws and
regulations, ensure that fees charged by its competent
authorities on application referred to in paragraph 1 do
not in themselves represent an unjustifiable impediment to
the movement of natural persons of the other Party under
this Chapter.
Article 96
Sub-Committee on Movement of Natural Persons
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Movement of Natural Persons (hereinafter
referred to in this Article as “the Sub-Committee”)
established in accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) adopting guidelines referred to in Annex 10;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 8
Energy and Mineral Resources
Article 97
Definitions
For the purposes of this Chapter:
(a) the term “energy and mineral resource good” means
any good listed in Annex 11;
(b) the term “energy and mineral resource regulatory
bodies” means the governmental bodies that
regulate and control the exploration,
exploitation, production, operation,
transportation, transmission or distribution,
purchase or sale of an energy and mineral
resource good;
(c) the term “energy and mineral resource regulatory
measure” means any measure by energy and mineral
resource regulatory bodies that directly affects
the exploration, exploitation, production,
operation, transportation, transmission or
distribution, purchase or sale of an energy and
mineral resource good;
(d) the term “energy and mineral resource sector”
means the sector relating to the exploration,
exploitation, production, operation,
transportation, transmission or distribution,
purchase or sale of energy and mineral resource
goods;
(e) the term “export licensing procedures” means
administrative procedures, whether or not
referred to as “licensing”, used by a Party for
the operation of export licensing regimes
requiring the submission of an application or
other documentation, other than that required for
customs procedures, to the relevant
administrative body as a prior condition for
exportation from that Party; and
(f) the term “person of the other Party” means either
a natural person or an enterprise of the other
Party.
Article 98
Promotion and Facilitation of Investment
1. (a) Both Parties shall cooperate in promoting and
facilitating investments between the Parties in
the energy and mineral resource sector through
ways such as:
(i) discussing effective ways on investment
promotion activities and capacity building;
(ii) facilitating the provision and exchange of
investment information including information
on the laws, regulations and policies of the
Parties;
(iii) encouraging and supporting investment
promotion activities of each Party or the
business sectors of the Parties, relating
to, in particular, the exploration,
exploitation and production of energy and
mineral resource goods and the
infrastructural facilities in the energy and
mineral resources sector; and
(iv) discussing effective ways of creating
stable, equitable, favourable and
transparent conditions for investors.
(b) The implementation and operation of this
paragraph shall be subject to the availability of
funds and the applicable laws and regulations of
each Party.
2. Annex 12 provides additional provisions with respect
to the promotion and facilitation of investment in the
energy and mineral resource sector.
Article 99
Import and Export Restrictions
1. The Parties reaffirm their obligation to comply with
the relevant provisions of the GATT 1994, with respect to
prohibitions or restrictions on the importation or
exportation of energy and mineral resource goods.
2. Each Party, when introducing a prohibition or
restriction otherwise justified under the relevant
provisions of the GATT 1994, with respect to the
exportation to or importation from the other Party of an
energy and mineral resource good, shall provide relevant
information concerning such prohibition or restriction as
early as possible to the other Party and reply, upon the
request of the other Party, to specific questions on such
prohibition or restriction from the other Party, with a
view to avoiding disruption of ordinary business activities
in the Parties.
Article 100
Export Licensing Procedures and Administrations
If a Party adopts or maintains export licensing
procedures with respect to an energy and mineral resource
good:
(a) the rules for export licensing procedures shall
be neutral in application and administered in a
fair and equitable manner;
(b) the rules and all information concerning
procedures for the submission of applications,
including the eligibility of persons of the other
Party to make such applications, the
administrative bodies to be approached, and the
lists of products subject to the licensing
requirement shall be published, as soon as
possible, in such a manner as to enable the other
Party and traders of the other Party to become
acquainted with them. Any exceptions,
derogations or changes in or from the rules
concerning export licensing procedures or the
list of products subject to export licensing
shall also be published in the same manner as
specified above;
(c) in the case of licensing requirements for
purposes other than the implementation of
quantitative restrictions, the Party shall
publish sufficient information for the other
Party and traders of the other Party to know the
basis for granting and/or allocating licenses;
(d) where the Party provides the possibility for
persons of the other Party to request exceptions
or derogations from a licensing requirement, the
former Party shall include this fact in the
information published under paragraph (b) as well
as information on how to make such a request and,
to the extent possible, an indication of the
circumstances under which such a request would be
considered;
(e) the Party shall provide, upon the request of the
other Party, all relevant information concerning
the administration of the restrictions in
accordance with its laws and regulations;
(f) when administering quotas by means of export
licensing, the Party shall inform the other Party
of the overall amount of quotas to be applied and
any change thereof;
(g) the Party shall hold consultations upon the
request of the other Party, on the rules for such
procedures with the other Party; and
(h) any person of the other Party which fulfils the
legal and administrative requirements of the
former Party shall be equally eligible to apply
and to be considered for a license. If the
license application is not approved, the
applicant of the other Party shall, on request,
be given the reason therefore and shall have a
right of appeal or review in accordance with the
domestic legislation or procedures of the former
Party.
Article 101
Energy and Mineral Resource Regulatory Measures
1. Each Party shall seek to ensure that, in the
application of any energy and mineral resource regulatory
measure, the energy and mineral resource regulatory bodies
of the Party shall avoid disruption of contractual
relationships which exist at the time of the application of
the energy and mineral resource regulatory measure to the
maximum extent practicable and implement the energy and
mineral resource regulatory measure in an orderly and
equitable manner.
2. If the energy and mineral resource regulatory bodies
of a Party adopt any new energy and mineral resource
regulatory measure, the Party shall, as soon as possible,
notify the other Party or publish the energy and mineral
resource regulatory measure, and respond, upon the request
of the other Party, to specific questions on the energy and
mineral resource regulatory measure from the other Party.
Article 102
Environmental Aspects
1. Each Party, in pursuit of sustainable development and
taking into account its obligations under those
international agreements concerning environment to which it
is a party, confirms the importance of avoiding or
minimizing, in an economically efficient manner, harmful
environmental impacts of all activities related to energy
and mineral resources in its Area.
2. Each Party shall:
(a) take account of environmental considerations, in
accordance with its laws and regulations,
throughout the process of formulation and
implementation of its policy on energy and
mineral resources;
(b) encourage favourable conditions for the transfer
and dissemination of technologies that contribute
to the protection of environment, consistent with
the adequate and effective protection of
intellectual property rights; and
(c) promote public awareness of environmental impacts
of activities related to energy and mineral
resources and of the scope for and the costs
associated with the prevention or abatement of
such impacts.
Article 103
Community Development
Each Party welcomes any contribution by investors of
the other Party to the development of its community when
such investors make investments in the energy and mineral
resource sector in its Area.
Article 104
Cooperation
1. Both Parties shall cooperate in the energy and mineral
resource sector of Indonesia.
2. (a) The Parties shall endeavor to make available the
necessary funds and other resources for the
implementation of cooperation under this Article
in accordance with their respective laws and
regulations.
(b) Costs of cooperation under this Article shall be
borne in an equitable manner to be mutually
agreed upon by the Parties.
3. (a) Areas of cooperation under this Article shall
include policy development, capacity building,
and technology transfer.
(b) Forms of cooperation under this Article shall be
set forth in the Implementing Agreement.
Article 105
Sub-Committee on Energy and Mineral Resources
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Energy and Mineral Resources (hereinafter
referred to in this Article as “the Sub-Committee”)
established in accordance with Article 15 shall be:
(a) exchanging information on any matters related to
this Chapter;
(b) reviewing and monitoring the implementation and
operation of this Chapter;
(c) discussing any issues related to this Chapter,
including issues related to business environment,
cooperation, energy security, and the development
of an open and competitive market;
(d) reporting the findings of the Sub-Committee and,
where appropriate, making recommendations, to the
Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Chapter 9
Intellectual Property
Article 106
General Provisions
1. The Parties, aiming at further promoting trade and
investment, shall grant and ensure adequate, effective and
non-discriminatory protection of intellectual property,
promote efficiency and transparency in the administration
of intellectual property protection system, and provide for
measures for the enforcement of intellectual property
rights against infringement, counterfeiting and piracy, in
accordance with the provisions of this Chapter and the
international agreements to which both Parties are parties.
2. The Parties reaffirm their commitment to comply with
the obligations set out in the international agreements
relating to intellectual property to which both Parties are
parties.
3. Each Party shall endeavor to become a party, if it is
not a party, to the following international agreements in
accordance with its necessary procedures:
(a) the Protocol Relating to the Madrid Agreement
Concerning the International Registration of
Marks of June 27, 1989, as amended;
(b) the International Convention for the Protection
of Performers, Producers of Phonograms and
Broadcasting Organizations of October 26, 1961;
and
(c) the 1991 Act of International Convention for the
Protection of New Varieties of Plants
(hereinafter referred to in this Chapter as “the
1991 UPOV Convention”).
Article 107
Definitions
For the purposes of this Chapter:
(a) the term “intellectual property” means all
categories of intellectual property:
(i) that are subject of Articles 112 through
118; and/or
(ii) that are under the TRIPS Agreement and/or
the relevant international agreements
referred to in the TRIPS Agreement; and
(b) the term “Nice Classification” means the
classification established by the Nice Agreement
Concerning the International Classification of
Goods and Services for the Purposes of the
Registration of Marks of June 15, 1957, as
amended.
Article 108
National Treatment
and Most-Favoured-Nation Treatment
1. Each Party shall accord to nationals of the other
Party treatment no less favourable than that it accords to
its own nationals with regard to the protection of
intellectual property in accordance with Articles 3 and 5
of the TRIPS Agreement.
2. Each Party shall accord to nationals of the other
Party treatment no less favourable than that it accords to
the nationals of a non-Party with regard to the protection
of intellectual property in accordance with Articles 4 and
5 of the TRIPS Agreement.
3. For the purposes of this Article:
(a) the term “nationals” shall have the same meaning
as in the TRIPS Agreement; and
(b) the term “protection” shall include matters
affecting the availability, acquisition, scope,
maintenance and enforcement of intellectual
property rights as well as those matters
affecting the use of intellectual property rights
specifically addressed in this Chapter.
Article 109
Procedural Matters
1. For the purposes of providing efficient administration
of intellectual property protection system, each Party
shall take appropriate measures to improve its
administrative procedures concerning intellectual property
rights in line with international standards.
2. Neither Party may require the authentication of
signatures or other means of self-identification on
documents to be submitted to the competent authority of the
Party, including applications, translations into a language
accepted by such authority of any earlier application whose
priority is claimed, powers of attorney and certifications
of assignment, in the course of application procedure or
other administrative procedures on patents, utility models,
industrial designs, or trademarks.
3. Notwithstanding paragraph 2, a Party may require:
(a) the authentication of signatures or other means
of self-identification, if the law of the Party
so provides, where the signatures or other means
of self-identification concern the surrender of a
patent or a registration of utility models,
industrial designs or trademarks; and
(b) the submission of evidence if there is reasonable
doubt as to the authenticity of signatures or
other means of self-identification on documents
submitted to the competent authority of the
Party. Where the competent authority notifies
the person that the submission of evidence is
required, the notification shall state the reason
for requiring the submission.
4. Neither Party may require the certification of
translation of an earlier application whose priority is
claimed.
5. Each Party shall introduce and implement a system in
which a power of attorney for application procedures or
other administrative procedures on patents, utility models,
industrial designs, or trademarks before the competent
authority of the Party may relate to one or more
applications and/or registrations identified in the power
of attorney or, subject to any exception indicated by the
appointing person, to all existing and future applications
and/or registrations of that person.
6. Neither Party shall require that the submission of a
power of attorney be completed together with the filing of
the application as a condition for according a filing date
to the application.
7. Each Party shall endeavor to improve patent attorney
or registered intellectual property rights consultant
system with a view to further facilitating acquisition and
utilization of industrial property rights.
8. The applications for and the grants of patents and the
publications thereof shall be classified in accordance with
the international patent classification system established
under the Strasbourg Agreement Concerning the International
Patent Classification of March 24, 1971, as amended. The
applications for registration of, and the registrations of,
trademarks for goods and services and the publications
thereof shall be classified in accordance with the Nice
Classification.
Article 110
Transparency
For the purposes of further promoting transparency in
administration of intellectual property protection system,
each Party shall, in accordance with its laws and
regulations, take appropriate measures to:
(a) publish information on at least the applications
for and the grants of patents, the registrations
of utility models and industrial designs, and the
applications for registration of, and the
registrations of, trademarks and new varieties of
plants, and make available to the public
information contained in the dossiers thereof;
(b) make available to the public information on the
applications for the suspension by the customs
authority of the release of counterfeit trademark
or pirated copyright goods as a border measure;
and
(c) make available to the public information
(including statistical information) on its
efforts to provide effective enforcement of
intellectual property rights and other
information with regard to intellectual property
protection system (including standards or
guidelines on examination of the applications for
patents and the applications for registration of
industrial designs and trademarks).
Article 111
Promotion of Public Awareness
of Protection of Intellectual Property
The Parties shall endeavor to promote public awareness
of protection of intellectual property including
educational and dissemination projects on the use of
intellectual property as well as on the enforcement of
intellectual property rights.
Article 112
Patents
1. Each Party shall ensure that any patent application is
not rejected solely on the ground that the subject matter
claimed in the application is related to a computer
program.
2. Each Party shall ensure that an applicant may, on its
own initiative, divide a patent application containing more
than one invention into a certain number of divisional
patent applications within the time limit provided for in
the laws and regulations of the Party.
3. Each Party shall ensure that an application for a
patent is examined upon the request of the applicant, where
appropriate, in preference to other applications, if the
applicant has filed an application for a patent of the same
or substantially the same invention in the other Party or
in any non-Party. Each Party may require the applicant to
furnish, together with the request, a result of relevant
prior art search, or a copy of the final decision by the
administrative authority for patents of the other Party or
of a non-Party (hereinafter referred to in this Article as
“the final decision”) on the application filed in the other
Party or in the non-Party.
4. Notwithstanding paragraph 3, a Party which requires,
pursuant to relevant provisions of its laws and
regulations, the applicant who filed an application for a
patent in that Party to furnish a copy of the final
decision on an application for a patent of the same or
substantially the same invention which the applicant filed
in the other Party or in any non-Party, shall examine the
application in preference to other applications, if the
applicant furnishes the aforementioned copy.
5. Each Party shall ensure that any person may provide
the administrative authority for patents with information
in writing that could deny novelty or inventive step of
inventions claimed in patent applications during the
pendency of those applications. Each Party shall take the
information, as appropriate, into consideration for
examining those applications.
6. Each Party shall ensure that an applicant may make
amendments to its patent application within a certain
period, in accordance with the laws and regulations of the
Party, after the filing of its appeal petition with respect
to the refusal of such application by the administrative
authority for patents.
7. Each Party shall provide that at least the following
acts shall be deemed as an infringement of a patent right
if performed without the consent of the patent owner:
(a) in the case of a patent for an invention of
product, acts of manufacturing, assigning,
leasing, importing, or offering for assignment or
lease, for commercial purposes, things to be used
exclusively for the manufacture of the product;
and
(b) in the case of a patent for an invention of
process, acts of manufacturing, assigning,
leasing, importing, or offering for assignment or
lease, for commercial purposes, things to be used
exclusively for the working of such invention.
Article 113
Industrial Designs
1. Each Party shall provide for the protection of
independently created industrial designs that are new or
original. Each Party shall provide that designs are not
new or original if they do not significantly differ from
known designs.
2. Each Party shall ensure that where more than one
application for registration of industrial design relating
to the same or similar industrial designs is filed on
different dates, only the applicant who filed first may
obtain a registration of the industrial design concerned.
3. Each Party shall ensure adequate and effective
protection of industrial designs of a part of an article as
well as an article as a whole.
4. Each Party shall ensure that an owner of protected
industrial design has the right to prevent third parties
not having the owner’s consent from making, selling or
importing articles bearing or embodying a design which is
identical or similar to the protected design, when such act
is undertaken for commercial purposes.
5. Each Party shall endeavor to establish appeal system
in which an appeal may be filed with the administrative
authority for industrial designs against its decision of
refusal of an application for registration of industrial
design.
Article 114
Trademarks
1. Each Party shall ensure that an owner of registered
trademark has the exclusive right to prevent all third
parties not having the owner’s consent from using in the
course of trade identical or similar signs for goods or
services which are identical or similar to those in respect
of which the trademark is registered, where such use would
result in a likelihood of confusion.
2. Each Party shall refuse or cancel the registration of
a trademark, which is identical or similar to a trademark
well-known in either Party as indicating goods or services
of another person, if the use of that trademark is for
unfair intentions, inter alia, intentions to gain an unfair
profit or intentions to cause damage to such person whether
or not such use would result in a likelihood of confusion.
3. Each Party shall ensure that, where more than one
application for registration of trademark relating to
identical or similar trademarks which are to be used on
identical or similar goods or services is filed on
different dates, only the applicant who filed first may
obtain a registration for the trademark concerned.
4. Each Party shall ensure that one and the same
application for registration of trademark may relate to
several goods and/or services, irrespective of whether they
belong to one class or to several classes of the Nice
Classification.
5. Each Party shall ensure that the period during which
the request for renewal of registration of a trademark may
be presented and the renewal fee may be paid shall start at
least six months before the date on which the renewal is
due and shall end at the earliest six months after that
date.
Article 115
Copyright and Related Rights
1. Each Party shall provide to authors all exclusive
rights protected under the Berne Convention for the
Protection of Literary and Artistic Works of September 9,
1886, as amended and the WIPO Copyright Treaty of December
20, 1996 (hereinafter referred to in this Article as “the
WIPO Copyright Treaty”).
2. Each Party shall provide to performers and producers
of phonograms all exclusive rights protected under the WIPO
Performances and Phonograms Treaty of December 20, 1996,
(hereinafter referred to in this Article as “the WIPO
Performances and Phonograms Treaty”).
3. Each Party shall provide to broadcasting and
cablecasting organizations the right to authorize or
prohibit the fixation of their broadcasts and cablecasts,
respectively, in accordance with its laws and regulations.
4. Each Party shall provide adequate and effective legal
remedies against any person knowingly performing any of the
following acts knowing, or with respect to civil remedies
having reasonable grounds to know, that it will induce,
enable, facilitate or conceal an infringement of copyright
or related rights:
(a) to remove or alter any electronic rights
management information without authority; and
(b) to distribute, import for distribution,
broadcast, communicate or make available to the
public, without authority, works, copies of
works, performances, copies of fixed performances
or phonograms knowing that electronic rights
management information has been removed or
altered without authority.
5. Each Party shall take necessary measures to promote
the development of collective management organizations for
copyright and related rights in the Party.
6. For the purposes of this Article:
(a) with respect to the rights of authors, the term
“rights management information” shall have the
same meaning as in Article 12 of the WIPO
Copyright Treaty; and
(b) with respect to the rights of performers and
producers of phonogram, the term “rights
management information” shall have the same
meaning as in Article 19 of the WIPO Performances
and Phonograms Treaty.
Article 116
New Varieties of Plants
Each Party shall provide for the protection of all
plant genera and species by an effective plant varieties
protection system which is consistent with the 1991 UPOV
Convention.
Article 117
Acts of Unfair Competition
1. Each Party shall provide for effective protection
against acts of unfair competition.
2. Any act of competition contrary to honest practices in
industrial or commercial matters constitutes an act of
unfair competition.
3. The following acts, in particular, shall be prohibited
as acts of unfair competition:
(a) all acts of such a nature as to create confusion
by any means whatever with the establishment, the
goods, the services, or the industrial or
commercial activities, of a competitor;
(b) false allegations in the course of trade of such
a nature as to discredit the establishment, the
goods, the services, or the industrial or
commercial activities, of a competitor;
(c) indications or allegations the use of which in
the course of trade is liable to mislead the
public as to the nature, the characteristics, the
suitability for their purpose, or the quantity,
of the goods or services, or the manufacturing
process of the goods; and
(d) acts by an agent or representative of an owner of
right relating to a trademark, without a
legitimate reason and the consent of the owner of
such right, of using a trademark identical or
similar to the trademark relating to such right
in respect of goods or services identical or
similar to those relating to such right; of
assigning, delivering, displaying for the
purposes of assignment or delivery, exporting,
importing, or providing through a
telecommunication line, goods using such
identical or similar trademark which are
identical or similar to the goods relating to
such right; or of providing services by using
such identical or similar trademark which are
identical or similar to the services relating to
such right.
4. The following acts may also be prohibited as acts of
unfair competition:
(a) acts of using an indication of goods or other
indication as one’s own which is identical or
similar to another person's indication of goods
or other indication which is famous; or acts of
assigning, delivering, displaying for the
purposes of assignment or delivery, exporting,
importing, or providing through a
telecommunication line, goods using such
indication;
(b) acts of assigning, leasing, displaying for the
purposes of assignment or lease, exporting or
importing, goods which imitate the configuration
of another person's goods except as provided for
in the laws and regulations of each Party; and
(c) acts of acquiring or holding right to use domain
names identical or similar to a specific
indication of goods or services of another
person, or using such domain names, with
intention to gain unfair profit or intention of
causing damage to such person.
5. Each Party shall establish appropriate remedies to
prevent or punish acts of unfair competition. In
particular, each Party shall ensure that any person that
considers its business interests to be affected by an act
of unfair competition may bring legal action and request
injunction against the act, destruction of the goods which
constitute the act, removal of facilities used for the act,
or any damages which result from the act, except as
provided for in the laws and regulations of the Party.
Article 118
Protection of Undisclosed Information
Each Party shall ensure in its laws and regulations
adequate and effective protection of undisclosed
information in accordance with Article 39 of the TRIPS
Agreement.
Article 119
Enforcement – Border Measures
1. Each Party shall adopt procedures to enable a right
holder, who has valid grounds for suspecting that the
importation or exportation of counterfeit trademark or
pirated copyright goods may take place, to lodge an
application in writing with competent authorities,
administrative or judicial, for the suspension by the
customs authority of the release into free circulation of
such goods.
2. In the case of the suspension with respect to
importation pursuant to paragraph 1, the importer and the
right holder shall be promptly notified of the suspension.
In the case of the suspension with respect to exportation
pursuant to paragraph 1, the exporter and the right holder
shall be promptly notified of the suspension.
3. Each Party shall ensure that its competent authorities
do not allow the re-exportation of counterfeit trademark or
pirated copyright goods other than in exceptional
circumstances.
Article 120
Enforcement – Civil Remedies
1. Each Party shall ensure that a right holder of
intellectual property has the right to claim against the
infringer damages adequate to compensate for the injury the
right holder has suffered because of an infringement of
that person’s intellectual property right by an infringer
who knowingly, or with reasonable grounds to know, engaged
in infringing activity.
2. Each Party shall endeavor, as necessary, to improve
its judicial system with a view to providing effective
civil remedies against infringement of intellectual
property rights.
Article 121
Enforcement – Criminal Remedies
Each Party shall provide for criminal procedures and
penalties to be applied in cases of the infringement of
patent rights, rights relating to utility models,
industrial designs, trademarks or layout-designs of
integrated circuits, copyrights or related rights, or plant
breeder’s rights, committed willfully and on a commercial
scale. Remedies available shall include imprisonment
and/or monetary fines sufficient to provide a deterrent,
consistently with the level of penalties applied for crimes
of a corresponding gravity.
Article 122
Cooperation
1. The Parties, recognizing the growing importance of
protection of intellectual property in pursuing further
promotion of trade and investment between the Parties, in
accordance with their respective laws and regulations and
subject to their available resources, shall cooperate in
the field of intellectual property. Costs of cooperation
under this Article shall be borne in as an equitable manner
as possible.
2. Areas and forms of cooperation under this Article
shall be set forth in the Implementing Agreement.
Article 123
Sub-Committee on Intellectual Property
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Intellectual Property (hereinafter referred to
in this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to intellectual
property with a view to enhancing protection of
intellectual property and enforcement of
intellectual property rights and to promoting
efficient and transparent administration of
intellectual property protection system;
(c) exchanging views on the following issues:
(i) protection of genetic resources, traditional
knowledge and folklore; and
(ii) liability of internet service providers;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Chapter 10
Government Procurement
Article 124
Exchange of Information
1. Each Party shall, subject to its laws and regulations,
respond in a timely manner to reasonable requests from the
other Party for information on its laws and regulations,
policies and practices on government procurement, as well
as any reforms to its existing government procurement
regimes.
2. The exchange of information under paragraph 1 shall be
facilitated through the following governmental authorities:
(a) for Japan, the Ministry of Foreign Affairs; and
(b) for Indonesia, the State Ministry of National
Development Planning (BAPPENAS).
Article 125
Sub-Committee on Government Procurement
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Government Procurement (hereinafter referred
to in this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) exchanging views on laws and regulations,
policies and practices, and other mutually agreed
issues regarding government procurement;
(c) discussing ways to facilitate cooperations
between relevant entities of the Parties in the
field of government procurement;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The decision by each Party on the composition of
representatives of the Government of the Party to the
Sub-Committee, shall be facilitated by its
governmental authority referred to in paragraph 2 of
Article 124.
Chapter 11
Competition
Article 126
Promotion of Competition
by Addressing Anti-competitive Activities
Each Party shall, in accordance with its laws and
regulations, promote competition by addressing anticompetitive
activities, in order to facilitate the
efficient functioning of its market.
Note: For the purposes of this Chapter, the term
“anti-competitive activities” means any conduct
or transaction that may be subject to penalties
or relief under the competition laws and
regulations of either Party.
Article 127
Cooperation on the Promotion of Competition
1. The Parties shall, in accordance with their respective
laws and regulations, cooperate on the promotion of
competition by addressing anti-competitive activities, and
on the capacity building for strengthening competition
policy and implementation of competition laws and
regulations, subject to their respective available
resources.
2. The details and procedures of cooperation under this
Article shall be specified in the Implementing Agreement.
Article 128
Non-Discrimination
Each Party shall apply its competition laws and
regulations in a manner which does not discriminate between
persons in like circumstances on the basis of their
nationality.
Article 129
Procedural Fairness
Each Party shall implement administrative and judicial
procedures in a fair manner to address anti-competitive
activities, pursuant to its relevant laws and regulations.
Article 130
Non-Application of Paragraph 2 of Article 9
Paragraph 2 of Article 9 shall not apply to this
Chapter.
Chapter 12
Improvement of Business Environment
and Promotion of Business Confidence
Article 131
Basic Principles
1. The Parties, confirming their interest in creating a
more favourable business environment with a view to
promoting trade and investment activities by enterprises of
the Parties, shall from time to time have consultations in
order to address issues concerning the improvement of the
business environment in the Parties and to facilitate the
promotion of the business confidence among enterprises of
the Parties.
2. Each Party shall, in accordance with its laws and
regulations, take appropriate measures to further improve
the business environment for the benefit of the enterprises
of the Parties conducting their business activities in the
Parties.
3. The Parties shall, in accordance with their respective
laws and regulations, promote cooperation to further
improve the business environment in their respective
Parties and take necessary measures including establishing
such mechanisms as provided for in subparagraph 1(j) of
Article 15 and Article 133.
Article 132
Sub-Committee on Improvement of Business Environment
and Promotion of Business Confidence
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Improvement of Business Environment and
Promotion of Business Confidence(hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) addressing issues in relation to the improvement
of business environment and the promotion of the
business confidence that the Sub-Committee
considers appropriate, taking into account, as
necessary, the findings reported by a Liaison
Office on Improvement of Business Environment
established in accordance with Article 133, and
in cooperation with other relevant Sub-Committees
or existing mechanisms with a view to avoiding
unnecessary overlap with the works of such Sub-
Committees or mechanisms;
(b) reporting the findings and making recommendations
to the Parties, including the measures to be
taken by the Parties, regarding such functions as
referred to in subparagraph (a). The Parties
shall take into consideration such
recommendations. The Sub-Committee may consult
with the Joint Committee prior to the submission
of recommendations to the Parties;
(c) where appropriate, reviewing the implementation
of the recommendations referred to in
subparagraph (b);
(d) making available, where appropriate, to
enterprises of the Parties the recommendations
referred to in subparagraph (b) and the results
of the review referred to in subparagraph (c) in
an appropriate manner;
(e) reporting the recommendations referred to in
subparagraph (b) and other findings in relation
to the implementation and operation of this
Chapter to the Joint Committee; and
(f) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The other details of the Sub-Committee may be set
forth in the Implementing Agreement.
Article 133
Liaison Office on Improvement of Business Environment
1. Each Party shall designate and maintain a Liaison
Office on Improvement of Business Environment for the
purposes of this Chapter.
2. The functions and other details of the Liaison Office
on Improvement of Business Environment may be set forth in
the Implementing Agreement.
Chapter 13
Cooperation
Article 134
Basic Principles
The Parties shall promote cooperation under this
Agreement for their mutual benefits in order to liberalize
and facilitate trade and investment between the Parties and
to promote the well-being of the peoples of the Parties.
For this purpose, the Parties shall cooperate between the
Governments of the Parties and, where necessary and
appropriate, encourage and facilitate cooperation between
the parties other than the Governments of the Parties, in
the following fields:
(a) manufacturing industries;
(b) agriculture, forestry and fisheries;
(c) trade and investment promotion;
(d) human resource development;
(e) tourism;
(f) information and communications technology;
(g) financial services;
(h) government procurement;
(i) environment; and
(j) other fields to be mutually agreed upon by the
Parties.
Note: Cooperation in the fields of customs procedures,
energy and mineral resources, intellectual property
and competition is provided for in Chapters 4, 8, 9
and 11, respectively.
Article 135
Areas and Forms of Cooperation
Areas and forms of cooperation under this Chapter may
be set forth in the Implementing Agreement.
Article 136
Costs of Cooperation
1. The Parties shall endeavor to make available the
necessary funds and other resources for the implementation
of cooperation under this Chapter in accordance with their
respective laws and regulations.
2. Costs of cooperation under this Chapter shall be borne
in an equitable manner to be mutually agreed upon by the
Parties.
Article 137
Sub-Committee on Cooperation
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Cooperation (hereinafter referred to in this
Article as “the Sub-Committee”) established in accordance
with Article 15 shall be:
(a) exchanging information on cooperation;
(b) reviewing, monitoring and giving guidance on the
implementation and operation of this Chapter;
(c) identifying ways for further cooperation;
(d) discussing any issues related to this Chapter;
(e) reporting the findings of the Sub-Committee to
the Joint Committee; and
(f) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The Sub-Committee shall respect consultation
mechanisms for Official Development Assistance and other
cooperation schemes between the Parties and, as
appropriate, share information and coordinate with such
mechanisms and schemes to ensure effective and efficient
implementation of cooperative activities and projects.
Chapter 14
Dispute Settlement
Article 138
Scope
1. This Chapter shall apply with respect to the
settlement of disputes between the Parties arising out of
the interpretation and/or application of this Agreement.
2. Notwithstanding paragraph 1, this Chapter except
Article 139 shall not apply to Articles 104 and 122, and
Chapters 10 through 13.
3. Nothing in this Chapter shall prejudice any rights of
the Parties to have recourse to dispute settlement
procedures available under any other international
agreement to which both Parties are parties.
4. Notwithstanding paragraph 3, once a dispute settlement
procedure has been initiated under this Chapter or under
any other international agreement to which both Parties are
parties with respect to a particular dispute, that
procedure shall be used to the exclusion of any other
procedure for that particular dispute.
Article 139
General Principle
Any dispute between the Parties arising out of the
interpretation and/or application of this Agreement shall,
as far as possible, be settled peacefully and amicably.
Article 140
Consultations
1. Either Party may request in writing consultations to
the other Party concerning any matter arising out of the
interpretation and/or application of this Agreement.
2. When a Party requests consultations pursuant to
paragraph 1, the other Party shall reply to the request and
enter into consultations in good faith within 60 days after
the date of receipt of the request. In a case of
consultations regarding perishable goods, the other Party
shall enter into consultations within 20 days after the
date of receipt of the request.
3. Unless otherwise agreed by the Parties, consultations
shall be treated as confidential. Consultations shall be
without prejudice to the rights of either Party in any
further proceedings.
Article 141
Good Offices, Conciliation or Mediation
1. Good offices, conciliation or mediation may be
requested at any time by either Party. They may begin at
any time by agreement of the Parties, and be terminated at
any time upon the request of either Party.
2. If the Parties agree, good offices, conciliation or
mediation may continue while procedures of the arbitral
tribunal provided for in this Chapter are in progress.
3. Proceedings involving good offices, conciliation or
mediation and positions taken by the Parties during these
proceedings, shall be treated as confidential, and without
prejudice to the rights of either Party in any further
proceedings.
Article 142
Establishment of Arbitral Tribunals
1. The complaining Party that requested consultations
under Article 140 may request in writing the establishment
of an arbitral tribunal to the Party complained against:
(a) if the Party complained against does not enter
into such consultations within 60 days, or within
20 days in a case of consultations regarding
perishable goods, after the date of receipt of
the request for such consultations; or
(b) if the Parties fail to resolve the dispute
through such consultations within 90 days, or
within 50 days in a case of consultations
regarding perishable goods, after the date of
receipt of the request for such consultations,
provided that the complaining Party considers that any
benefit accruing to it under this Agreement is being
nullified or impaired as a result of the failure of the
Party complained against to carry out its obligations under
this Agreement, or as a result of the application by the
Party complained against of measures which are in conflict
with its obligations under this Agreement.
2. Any request to establish an arbitral tribunal pursuant
to this Article shall identify:
(a) the legal basis of the complaint including the
provisions of this Agreement alleged to have been
breached and any other relevant provisions; and
(b) the factual basis for the complaint.
3. The arbitral tribunal shall comprise three
arbitrators, who should have relevant technical or legal
expertise.
4. Each Party shall, within 45 days after the date of
receipt of the request for the establishment of an arbitral
tribunal, appoint one arbitrator who may be its national
and propose up to three candidates to serve as the third
arbitrator who shall be the chair of the arbitral tribunal.
The third arbitrator shall not be a national of either
Party, nor have his or her usual place of residence in
either Party, nor be employed by either Party, nor have
dealt with the dispute in any capacity.
5. The Parties shall agree on and appoint the third
arbitrator within 60 days after the date of receipt of the
request for the establishment of an arbitral tribunal,
taking into account the candidates proposed pursuant to
paragraph 4.
6. If a Party has not appointed an arbitrator pursuant to
paragraph 4 or if the Parties fail to agree on and appoint
the third arbitrator pursuant to paragraph 5, the
arbitrator or arbitrators not yet appointed shall be chosen
within 15 days by lot from the candidates proposed pursuant
to paragraph 4.
7. The date of the establishment of an arbitral tribunal
shall be the date on which the chair is appointed.
Article 143
Functions of Arbitral Tribunals
1. The arbitral tribunal established pursuant to Article
142:
(a) should consult with the Parties as appropriate
and provide adequate opportunities for the
development of a mutually satisfactory
resolution;
(b) shall make its award in accordance with this
Agreement and applicable rules of international
law; and
(c) shall set out, in its award, its findings of law
and fact, together with the reasons therefore.
2. The arbitral tribunal may seek, from the Parties, such
relevant information as it considers necessary and
appropriate. The Parties shall respond promptly and fully
to any request by the arbitral tribunal for such
information as the arbitral tribunal considers necessary
and appropriate.
3. The arbitral tribunal may seek information from any
relevant source and may consult experts to obtain their
opinion on certain aspects of the matter. With respect to
factual issues concerning a scientific or other technical
matter raised by a Party, the arbitral tribunal may request
advisory reports in writing from experts.
4. The arbitral tribunal may, at the request of a Party
or on its own initiative, select, in consultation with the
Parties, no fewer than two scientific or technical experts
who shall assist the arbitral tribunal throughout its
proceedings, but who shall not have the right to vote in
respect of any decision to be made by the arbitral
tribunal, including its award.
Article 144
Proceedings of Arbitral Tribunals
1. The arbitral tribunal shall meet in closed session.
2. The venue for the proceedings of the arbitral tribunal
shall be decided by mutual consent of the Parties, failing
which it shall alternate between the Parties.
3. The deliberations of the arbitral tribunal and the
documents submitted to it shall be kept confidential.
4. Notwithstanding paragraph 3, either Party may make
public statements as to its views regarding the dispute,
but shall treat as confidential, information and written
submissions submitted by the other Party to the arbitral
tribunal which that other Party has designated as
confidential. Where a Party has provided information or
written submissions designated to be confidential, that
Party shall, upon request of the other Party, provide a
non-confidential summary of the information or written
submissions which may be disclosed publicly.
5. The Parties shall be given the opportunity to attend
any of the presentations, statements or rebuttals in the
proceedings. Any information or written submissions
submitted by a Party to the arbitral tribunal, including
any comments on the descriptive part of the draft award and
responses to questions put by the arbitral tribunal, shall
be made available to the other Party.
6. The award of the arbitral tribunal shall be drafted
without the presence of the Parties, and in the light of
the information provided and the statements made.
7. The arbitral tribunal shall, within 90 days after the
date of its establishment, submit to the Parties its draft
award, including both the descriptive part and its findings
and conclusions, for the purposes of enabling the Parties
to review precise aspects of the draft award. When the
arbitral tribunal considers that it cannot submit its draft
award within the aforementioned 90 days period, it may
extend that period with the consent of the Parties. A
Party may submit comments in writing to the arbitral
tribunal on the draft award within 15 days after the date
of submission of the draft award.
8. The arbitral tribunal shall issue its award, within 30
days after the date of submission of the draft award.
9. The arbitral tribunal shall attempt to make its
decisions, including its award, by consensus but may also
make its decisions, including its award, by majority vote.
10. The award of the arbitral tribunal shall be final and
binding on the Parties.
Article 145
Suspension and Termination of Proceedings
1. Where the Parties agree, the arbitral tribunal may
suspend its work at any time for a period not to exceed 12
months. In the event of such a suspension, the time-frames
set out in paragraphs 7 and 8 of Article 144 and paragraph
8 of Article 146 shall be extended by the amount of time
that the work was suspended. The proceedings of the
arbitral tribunal shall be resumed at any time upon the
request of either Party. If the work of the arbitral
tribunal has been suspended for more than 12 months, the
authority for establishment of the arbitral tribunal shall
lapse unless the Parties agree otherwise.
2. The Parties may agree to terminate the proceedings of
the arbitral tribunal at any time before the issuance of
the award to the Parties by jointly so notifying the chair
of the arbitral tribunal.
Article 146
Implementation of Award
1. The Party complained against shall promptly comply
with the award of the arbitral tribunal issued pursuant to
Article 144.
2. The Party complained against shall, within 20 days
after the date of issuance of the award, notify the
complaining Party of the period of time for implementing
the award. If the complaining Party considers the period
of time notified to be unacceptable, it may request to the
Party complained against consultations with a view to
reaching a mutually satisfactory implementation period. If
no satisfactory implementation period has been agreed
within 30 days after the date of receipt of the request,
the complaining Party may refer the matter to an arbitral
tribunal.
3. If the Party complained against considers it
impracticable to comply with the award within the
implementation period as determined pursuant to paragraph
2, the Party complained against shall, no later than the
expiry of that implementation period, enter into
consultations with the complaining Party, with a view to
developing mutually satisfactory resolution through
compensation or any alternative arrangement. If no
satisfactory resolution has been agreed within 30 days
after the date of expiry of that implementation period, the
complaining Party may notify the Party complained against
that it intends to suspend the application to the Party
complained against of concessions or other obligations
under this Agreement.
4. If the complaining Party considers that the Party
complained against has failed to comply with the award
within the implementation period as determined pursuant to
paragraph 2, it may refer the matter to an arbitral
tribunal.
5. If the arbitral tribunal to which the matter is
referred pursuant to paragraph 4 confirms that the Party
complained against has failed to comply with the award
within the implementation period as determined pursuant to
paragraph 2, the complaining Party may, within 30 days
after the date of such confirmation by the arbitral
tribunal, notify the Party complained against that it
intends to suspend the application to the Party complained
against of concessions or other obligations under this
Agreement.
6. The suspension of the application of concessions or
other obligations under paragraphs 3 and 5 may only be
implemented at least 30 days after the date of the
notification in accordance with those paragraphs. Such
suspension shall:
(a) not be effected if, in respect of the dispute to
which the suspension relates, consultations or
proceedings before the arbitral tribunal are in
progress;
(b) be temporary, and be discontinued when the
Parties reach a mutually satisfactory resolution
or where compliance with the original award is
effected;
(c) be restricted to the same level of nullification
or impairment that is attributable to the failure
to comply with the original award; and
(d) be restricted to the same sector or sectors to
which the nullification or impairment relates,
unless it is not practicable or effective to
suspend the application of concessions or other
obligations in such sector or sectors.
7. If the Party complained against considers that the
requirements for the suspension of the application to it of
concessions or other obligations under this Agreement by
the complaining Party set out in paragraph 3, 5 or 6 have
not been met, it may request consultations with the
complaining Party. The complaining Party shall enter into
consultations within 10 days after the date of receipt of
the request. If the Parties fail to resolve the matter
within 30 days after the date of receipt of the request for
consultations pursuant to this paragraph, the Party
complained against may refer the matter to an arbitral
tribunal.
8. The arbitral tribunal that is established for the
purposes of this Article shall, wherever possible, have, as
its arbitrators, the arbitrators of the original arbitral
tribunal. If this is not possible, then the arbitrators to
the arbitral tribunal that is established for the purposes
of this Article shall be appointed pursuant to paragraphs 4
through 6 of Article 142. The arbitral tribunal
established for the purposes of this Article shall issue
its award within 60 days after the date when the matter is
referred to it. Such award shall be binding on the
Parties.
Article 147
Modification of Time Periods
Any time period provided for in this Chapter may be
modified by mutual consent of the Parties.
Article 148
Expenses
Unless the Parties agree otherwise, the expenses of
the arbitral tribunal, including the remuneration of its
arbitrators, shall be borne by the Parties in equal shares.
Chapter 15
Final Provisions
Article 149
Table of Contents and Headings
The table of contents and headings of the Chapters and
the Articles of this Agreement are inserted for convenience
of reference only and shall not affect the interpretation
of this Agreement.
Article 150
Annexes and Notes
The Annexes and Notes to this Agreement shall form an
integral part of this Agreement.
Article 151
General Review
The Parties shall undertake a general review of the
implementation and operation of this Agreement in the fifth
calendar year following the calendar year in which this
Agreement enters into force, and every five years
thereafter, unless otherwise agreed by the Parties.
Article 152
Amendment
1. This Agreement may be amended by agreement between the
Parties.
2. Such amendment shall be approved by the Parties in
accordance with their respective legal procedures, and
shall enter into force on the date to be agreed upon by the
Parties.
3. Notwithstanding paragraph 2, amendments relating only
to Annex 2 or 3 may be made by diplomatic notes exchanged
between the Governments of the Parties.
Article 153
Entry into Force
This Agreement shall enter into force on the thirtieth
day after the date on which the Governments of the Parties
exchange diplomatic notes informing each other that their
respective legal procedures necessary for entry into force
of this Agreement have been completed. It shall remain in
force unless terminated as provided for in Article 154.
Article 154
Termination
Either Party may terminate this Agreement by giving
one year’s advance notice in writing to the other Party.
IN WITNESS WHEREOF, the undersigned, being duly
authorized thereto, have signed this Agreement.
DONE at Jakarta on this twentieth day of August in the
year 2007 in duplicate in the English language.
For Japan:
安倍晋三
For the Republic of
Indonesia:
S.B.Yudhoyono
Preamble
Chapter 1 General Provisions
Article 1 Objectives
Article 2 General Definitions
Article 3 Transparency
Article 4 Public Comment Procedures
Article 5 Administrative Procedures
Article 6 Review and Appeal
Article 7 Administrative Guidance
Article 8 Measures against Corruption and Bribery
Article 9 Confidential Information
Article 10 Taxation
Article 11 General and Security Exceptions
Article 12 Relation to Other Agreements
Article 13 Implementing Agreement
Article 14 Joint Committee
Article 15 Sub-Committees
Article 16 Communications
Chapter 2 Trade in Goods
Article 17 Definitions
Article 18 Classification of Goods
Article 19 National Treatment
Article 20 Elimination of Customs Duties
Article 21 Customs Valuation
Article 22 Export Subsidies
Article 23 Non-tariff Measures
Article 24 Bilateral Safeguard Measures
Article 25 Restrictions to Safeguard the Balance of Payments
Article 26 Sub-Committee on Trade in Goods
Article 27 Operational Procedures for Trade in Goods
Chapter 3 Rules of Origin
Article 28 Definitions
Article 29 Originating Goods
Article 30 Accumulation
Article 31 De Minimis
Article 32 Non-qualifying Operations
Article 33 Consignment Criteria
Article 34 Unassembled or Disassembled Goods
Article 35 Fungible Goods and Materials
Article 36 Indirect Materials
Article 37 Accessories, Spare Parts and Tools
Article 38 Packaging Materials and Containers for Retail Sale
Article 39 Packing Materials and Containers for Shipment
Article 40 Claim for Preferential Tariff Treatment
Article 41 Certificate of Origin
Article 42 Obligations regarding Exportations
Article 43 Request for Checking of Certificate of Origin
Article 44 Verification Visit
Article 45 Determination of Origin and
Preferential Tariff Treatment
Article 46 Confidentiality
Article 47 Penalties and Measures against False Declaration
Article 48 Miscellaneous
Article 49 Sub-Committee on Rules of Origin
Article 50 Operational Procedures for Rules of Origin
Chapter 4 Customs Procedures
Article 51 Scope
Article 52 Definition
Article 53 Transparency
Article 54 Customs Clearance
Article 55 Cooperation and Exchange of Information
Article 56 Sub-Committee on Customs Procedures
Chapter 5 Investment
Article 57 Scope
Article 58 Definitions
Article 59 National Treatment
Article 60 Most-Favoured-Nation Treatment
Article 61 General Treatment
Article 62 Access to the Courts of Justice
Article 63 Prohibition of Performance Requirements
Article 64 Reservations and Exceptions
Article 65 Expropriation and Compensation
Article 66 Protection from Strife
Article 67 Transfers
Article 68 Subrogation
Article 69 Settlement of Investment Disputes between a Party and an Investor of the Other Party
Article 70 Temporary Safeguard Measures
Article 71 Prudential Measures
Article 72 Denial of Benefits
Article 73 Taxation Measures as Expropriation
Article 74 Environmental Measures
Article 75 Sub-Committee on Investment
Chapter 6 Trade in Services
Article 76 Scope
Article 77 Definitions
Article 78 Market Access
Article 79 National Treatment
Article 80 Additional Commitments
Article 81 Schedule of Specific Commitments
Article 82 Most-Favoured-Nation Treatment
Article 83 Authorization, Licensing or Qualification
Article 84 Mutual Recognition
Article 85 Transparency
Article 86 Monopolies and Exclusive Service Suppliers
Article 87 Payments and Transfers
Article 88 Restrictions to Safeguard the Balance of Payments
Article 89 Emergency Safeguard Measures
Article 90 Denial of Benefits
Article 91 Sub-Committee on Trade in Services
Chapter 7 Movement of Natural Persons
Article 92 Scope
Article 93 Definition
Article 94 Specific Commitments
Article 95 Requirements and Procedures
Article 96 Sub-Committee on Movement of Natural Persons
Chapter 8 Energy and Mineral Resources
Article 97 Definitions
Article 98 Promotion and Facilitation of Investment
Article 99 Import and Export Restrictions
Article 100 Export Licensing Procedures and Administrations
Article 101 Energy and Mineral Resource Regulatory Measures
Article 102 Environmental Aspects
Article 103 Community Development
Article 104 Cooperation
Article 105 Sub-Committee on Energy and Mineral Resources
Chapter 9 Intellectual Property
Article 106 General Provisions
Article 107 Definitions
Article 108 National Treatment and Most-Favoured-Nation Treatment
Article 109 Procedural Matters
Article 110 Transparency
Article 111 Promotion of Public Awareness of
Protection of Intellectual Property
Article 112 Patents
Article 113 Industrial Designs
Article 114 Trademarks
Article 115 Copyright and Related Rights
Article 116 New Varieties of Plants
Article 117 Acts of Unfair Competition
Article 118 Protection of Undisclosed Information
Article 119 Enforcement – Border Measures
Article 120 Enforcement – Civil Remedies
Article 121 Enforcement – Criminal Remedies
Article 122 Cooperation
Article 123 Sub-Committee on Intellectual Property
Chapter 10 Government Procurement
Article 124 Exchange of Information
Article 125 Sub-Committee on Government Procurement
Chapter 11 Competition
Article 126 Promotion of Competition by Addressing Anti-competitive Activities
Article 127 Cooperation on the Promotion of Competition
Article 128 Non-Discrimination
Article 129 Procedural Fairness
Article 130 Non-Application of Paragraph 2 of Article 9
Chapter 12 Improvement of Business Environment and Promotion of Business Confidence
Article 131 Basic Principles
Article 132 Sub-Committee on Improvement of Business Environment and Promotion of Business Confidence
Article 133 Liaison Office on Improvement of Business Environment
Chapter 13 Cooperation
Article 134 Basic Principles
Article 135 Areas and Forms of Cooperation
Article 136 Costs of Cooperation
Article 137 Sub-Committee on Cooperation
Chapter 14 Dispute Settlement
Article 138 Scope
Article 139 General Principle
Article 140 Consultations
Article 141 Good Offices, Conciliation or Mediation
Article 142 Establishment of Arbitral Tribunals
Article 143 Functions of Arbitral Tribunals
Article 144 Proceedings of Arbitral Tribunals
Article 145 Suspension and Termination of Proceedings
Article 146 Implementation of Award
Article 147 Modification of Time Periods
Article 148 Expenses
Chapter 15 Final Provisions
Article 149 Table of Contents and Headings
Article 150 Annexes and Notes
Article 151 General Review
Article 152 Amendment
Article 153 Entry into Force
Article 154 Termination
Annex 1 referred to Schedules in relation to in Chapter 2 Article 20
Annex 2 referred to Product Specific Rules in Chapter 3
Annex 3 referred to Minimum Data Requirement for in Chapter 3 Certificate of Origin
Annex 4 referred to Reservations for Measures referred in Chapter 5 to in Subparagraph 1(a) of Article 64
Annex 5 referred to Reservations for Measures referred in Chapter 5 to in Paragraph 3 of Article 64
Annex 6 referred to Additional Provisions with respect in Chapter 5 to the Settlement of Investment Disputes referred to in Paragraph 21 of Article 69
Annex 7 referred to Financial Services in Chapter 6
Annex 8 referred to Schedules of Specific Commitments in Chapter 6 in relation to Article 81
Annex 9 referred to Lists of Most-Favoured-Nation in Chapter 6 Treatment Exemptions in relation to Article 82
Annex 10 referred to Specific Commitments for the in Chapter 7 Movement of Natural Persons
Annex 11 referred to List of Energy and Mineral Resource in Chapter 8 Goods
Annex 12 referred to Additional Provisions with respect in Chapter 8 to the Promotion and Facilitation of Investment in the Energy and Mineral Resource Sector referred to in Paragraph 2 of Article 98
Preamble
Japan and the Republic of Indonesia (hereinafter referred to as “Indonesia”), Conscious of their longstanding friendship and strong political and economic ties that have developed through many years of fruitful and mutually beneficial cooperation between the Parties; Believing that such bilateral relationship will be enhanced by forging mutually beneficial economic partnership through, inter alia, cooperation, trade and investment facilitation, and trade liberalization; Reaffirming that the economic partnership will provide a useful framework for enhanced cooperation and serve the common interests of the Parties in various fields as agreed in this Agreement and lead to the improvement of economic efficiency and the development of trade, investment and human resources; Recognizing that such partnership would create larger and new market, and enhance the competitiveness, attractiveness and vibrancy of their markets; Acknowledging that a dynamic and rapidly changing global environment brought about by globalization and technological progress presents various economic and strategic challenges and opportunities to the Parties; Recalling Article XXIV of the General Agreement on Tariffs and Trade 1994 and Article V of the General Agreement on Trade in Services in Annex 1A and Annex 1B, respectively, to the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh, April 15,1994; Bearing in mind the Framework for Comprehensive Economic Partnership between Japan and the Association of Southeast Asian Nations (hereinafter referred to as “ASEAN”) signed in Bali, Indonesia on October 8, 2003; Convinced that this Agreement would open a new era for the relationship between the Parties; and Determined to establish a legal framework for an economic partnership between the Parties;
Japan and the Republic of Indonesia (hereinafter referred to as “Indonesia”), Conscious of their longstanding friendship and strong political and economic ties that have developed through many years of fruitful and mutually beneficial cooperation between the Parties; Believing that such bilateral relationship will be enhanced by forging mutually beneficial economic partnership through, inter alia, cooperation, trade and investment facilitation, and trade liberalization; Reaffirming that the economic partnership will provide a useful framework for enhanced cooperation and serve the common interests of the Parties in various fields as agreed in this Agreement and lead to the improvement of economic efficiency and the development of trade, investment and human resources; Recognizing that such partnership would create larger and new market, and enhance the competitiveness, attractiveness and vibrancy of their markets; Acknowledging that a dynamic and rapidly changing global environment brought about by globalization and technological progress presents various economic and strategic challenges and opportunities to the Parties; Recalling Article XXIV of the General Agreement on Tariffs and Trade 1994 and Article V of the General Agreement on Trade in Services in Annex 1A and Annex 1B, respectively, to the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh, April 15,1994; Bearing in mind the Framework for Comprehensive Economic Partnership between Japan and the Association of Southeast Asian Nations (hereinafter referred to as “ASEAN”) signed in Bali, Indonesia on October 8, 2003; Convinced that this Agreement would open a new era for the relationship between the Parties; and Determined to establish a legal framework for an economic partnership between the Parties;
HAVE AGREED as follows:
Chapter 1
General Provisions
Article 1
Objectives
The objectives of this Agreement are to:
(a) facilitate, promote and liberalize trade in goodand services between the Parties;
(b) increase investment opportunities and promote investment activities through strengthening
protection for investments and investment activities in the Parties;
(c) ensure protection of intellectual property and promote cooperation in the field thereof;
(d) enhance transparency of government procurement regimes of the Parties, and promote cooperation for mutual benefits of the Parties in the field of government procurement;
(e) promote competition by addressing anticompetitive
activities, and cooperate on the
promotion of competition;
(f) improve business environment in the Parties;
(g) establish a framework to enhance closer
cooperation in the fields agreed in this
Agreement; and
(h) create effective procedures for the
implementation and application of this Agreement
and for the resolution of disputes.
Article 2
General Definitions
1. For the purposes of this Agreement:
(a) the term “Area” means:
(i) with respect to Japan, the territory of
Japan, and all the area beyond its
territorial sea, including the sea-bed and
subsoil thereof, over which Japan exercises
sovereign rights or jurisdiction in
accordance with international law and the
laws and regulations of Japan; and
(ii) with respect to Indonesia, the land
territories, territorial sea including seabed
and subsoil thereof, archipelagic
waters, internal waters, airspace over such
territories, sea and waters, as well as
continental shelf and exclusive economic
zone, over which Indonesia has sovereignty,
sovereign rights or jurisdiction, as defined
in its laws, and in accordance with the
United Nations Convention on the Law of the
Sea, done at Montego Bay, December 10, 1982;
(b) the term “customs authority” means the authority
that is responsible for the administration and
enforcement of customs laws and regulations. In
the case of Japan, the Ministry of Finance, and
in the case of Indonesia, the Directorate General
of Customs and Excise;
(c) the term “GATS” means the General Agreement on
Trade in Services in Annex 1B to the Marrakesh
Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994;
(d) the term “GATT 1994” means the General Agreement
on Tariffs and Trade 1994 in Annex 1A to the
Marrakesh Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994.
For the purposes of this Agreement, references to
articles in the GATT 1994 include the
interpretative notes;
(e) the term “Harmonized System” or “HS” means the
Harmonized Commodity Description and Coding
System set out in the Annex to the International
Convention on the Harmonized Commodity
Description and Coding System, and adopted and
implemented by the Parties in their respective
laws;
(f) the term “Parties” means Japan and Indonesia and
the term “Party” means either Japan or Indonesia;
and
(g) the term “WTO Agreement” means the Marrakesh
Agreement Establishing the World Trade
Organization, done at Marrakesh, April 15, 1994.
2. Nothing in subparagraph 1(a) shall affect the rights
and obligations of the Parties under international law,
including those under the United Nations Convention on the
Law of the Sea, done at Montego Bay, December 10, 1982.
Article 3
Transparency
1. Each Party shall make publicly available its laws and
regulations as well as international agreements to which
the Party is a party, with respect to any matter covered by
this Agreement.
2. Each Party shall make available to the public, the
names and addresses of the competent authorities
responsible for laws and regulations referred to in
paragraph 1.
3. Each Party shall, upon the request by the other Party,
within a reasonable period of time, provide information to
the other Party with respect to matters referred to in
paragraph 1.
4. When introducing or changing its laws and regulations
that significantly affect the implementation and operation
of this Agreement, each Party shall endeavor to take
appropriate measures to enable interested persons to become
acquainted with such introduction or change.
Article 4
Public Comment Procedures
The Government of each Party shall, in accordance with
the laws and regulations of the Party, endeavor to make
public in advance regulations of general application that
affect any matter covered by this Agreement and to provide
a reasonable opportunity for comments by the public before
adoption of such regulations.
Article 5
Administrative Procedures
1. Where administrative decisions which pertain to or
affect the implementation and operation of this Agreement
are taken by the competent authorities of the Government of
a Party, the competent authorities shall, in accordance
with the laws and regulations of the Party, endeavor to:
(a) inform the applicant of the decision within a
reasonable period of time after the submission of
the application considered complete under the
laws and regulations of the Party, taking into
account the established standard period of time
referred to in paragraph 3; and
(b) provide, within a reasonable period of time,
information concerning the status of the
application, at the request of the applicant.
2. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, establish criteria for taking administrative
decisions in response to submitted applications. The
competent authorities shall endeavor to:
(a) make such criteria as specific as possible; and
(b) make such criteria publicly available except when
it would extraordinarily raise administrative
difficulties for the Government of the Party.
3. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, endeavor to:
(a) establish standard periods of time between the
receipt of applications by the competent
authorities and the administrative decisions
taken in response to submitted applications; and
(b) make publicly available such periods of time, if
established.
4. The competent authorities of the Government of a Party
shall, in accordance with the laws and regulations of the
Party, prior to any final decision which imposes
obligations on or restricts rights of a person, endeavor to
provide that person with:
(a) a reasonable notice, including a description of
the nature of the measure, specific provisions
upon which such measure will be based, and the
facts which may be a cause of taking such
measure; and
(b) a reasonable opportunity to present facts and
arguments in support of position of such person,
provided that time, nature of the measure and public
interest permit.
Article 6
Review and Appeal
1. Each Party shall, in accordance with its laws and
regulations, maintain judicial tribunals or procedures for
the purpose of prompt review and, where warranted,
correction of actions taken by its Government regarding
matters covered by this Agreement. Such tribunals or
procedures shall be impartial and independent of the
authorities entrusted with the administrative enforcement
of such actions.
2. Each Party shall ensure that the parties in any such
tribunals or procedures are provided with the right to:
(a) a reasonable opportunity to support or defend
their respective positions; and
(b) a decision based on the evidence and submissions
of record.
3. Each Party shall ensure, subject to appeal or further
review as provided for in its laws and regulations, that
such decision is implemented by the relevant authorities
with respect to the action at issue which is taken by its
Government.
Article 7
Administrative Guidance
1. For the purposes of this Article, the term
“administrative guidance” means any guidance,
recommendation or advice by a competent authority of the
Government of a Party which requires a person to do or
refrain from doing any act but does not create, impose
limitations on or in any way affect rights and obligations
of such person in order to pursue administrative
objectives.
2. Where a competent authority of the Government of a
Party renders administrative guidance with regard to any
matter covered by this Agreement, such competent authority
shall ensure that the administrative guidance does not
exceed the scope of its competence and shall not require
the person concerned to comply with the administrative
guidance without voluntary cooperation of such person.
3. Such competent authority shall ensure, in accordance
with the laws and regulations of its Party, that the person
concerned not be treated unfavourably solely on account of
non-compliance of such person with such administrative
guidance.
4. Such competent authority shall, in accordance with the
laws and regulations of its Party, provide to the person
concerned in writing, upon the request of such person, the
purposes and contents of the administrative guidance.
Article 8
Measures against Corruption and Bribery
Each Party shall, in accordance with its laws and
regulations, take appropriate measures to prevent and
combat corruption and bribery regarding matters covered by
this Agreement.
Article 9
Confidential Information
1. Each Party shall, in accordance with its laws and
regulations, maintain the confidentiality of information
provided in confidence by the other Party pursuant to this
Agreement.
2. Unless otherwise provided for in this Agreement,
nothing in this Agreement shall require a Party to provide
the other Party with confidential information, the
disclosure of which would impede the enforcement of the
laws and regulations of the former Party, or otherwise be
contrary to the public interest of the former Party, or
which would prejudice legitimate commercial interests of
particular enterprises, public or private.
Article 10
Taxation
1. Unless otherwise provided for in this Agreement, the
provisions of this Agreement shall not apply to any
taxation measures.
2. Nothing in this Agreement shall affect the rights and
obligations of either Party under any tax convention in
force between the Parties. In the event of any
inconsistency between this Agreement and any such
convention, that convention shall prevail to the extent of
the inconsistency.
3. Articles 3 and 9 shall apply to taxation measures, to
the extent that the provisions of this Agreement are
applicable to such taxation measures.
Article 11
General and Security Exceptions
1. For the purposes of Chapters 2, 3, 4, 5 other than
Article 66, and 8 of this Agreement, Articles XX and XXI of
the GATT 1994 are incorporated into and form part of this
Agreement, mutatis mutandis.
2. For the purposes of Chapters 5 other than Article 66,
6 and 7 of this Agreement, Articles XIV and XIV bis of the
GATS are incorporated into and form part of this Agreement, mutatis mutandis.
3. In cases where a Party takes any measure pursuant to
paragraph 1 or 2, that does not conform with the
obligations under Chapter 5 other than Article 66, the
Party shall make reasonable effort to notify the other
Party of the description of such measure either before the
measure is taken or as soon as possible thereafter.
4. For the purposes of Chapter 9 of this Agreement,
Article 73 of the Agreement on Trade-Related Aspects of
Intellectual Property Rights in Annex 1C to the WTO
Agreement (hereinafter referred to as “the TRIPS
Agreement”) is incorporated into and forms part of this
Agreement, mutatis mutandis.
Article 12
Relation to Other Agreements
1. The Parties reaffirm their rights and obligations
under the WTO Agreement or any other agreements to which
both Parties are parties.
2. In the event of any inconsistency between this
Agreement and the WTO Agreement, the WTO Agreement shall
prevail to the extent of the inconsistency.
3. In the event of any inconsistency between this
Agreement and any agreements other than the WTO Agreement,
to which both Parties are parties, the Parties shall
immediately consult with each other with a view to finding
a mutually satisfactory solution, taking into consideration
general principles of international law.
Article 13
Implementing Agreement
The Governments of the Parties shall conclude a
separate agreement setting forth the details and procedures
for the implementation of this Agreement (hereinafter
referred to as “the Implementing Agreement”).
Article 14
Joint Committee
1. A joint committee (hereinafter referred to as “the
Joint Committee”) shall be hereby established.
2. The functions of the Joint Committee shall be:
(a) reviewing and monitoring the implementation and
operation of this Agreement;
(b) considering and recommending to the Parties any
amendments to this Agreement;
(c) supervising and coordinating the work of all Sub-
Committees established under this Agreement;
(d) adopting:
(i) the Operational Procedures for Trade in
Goods and the Operational Procedures for
Rules of Origin, referred to in Article 27
and Article 50, respectively; and
(ii) any necessary decisions; and
(e) carrying out other functions as the Parties may
agree.
3. The Joint Committee:
(a) shall be composed of representatives of the
Governments of the Parties; and
(b) may establish and delegate its responsibilities
to Sub-Committees.
4. The Joint Committee shall establish its rules and
procedures.
5. The Joint Committee shall meet as such times as may be
agreed by the Parties. The venue of the meeting shall be
alternately in Japan and Indonesia, unless the Parties
agree otherwise.
Article 15
Sub-Committees
1. The following sub-committees shall be hereby
established:
(a) Sub-Committee on Trade in Goods;
(b) Sub-Committee on Rules of Origin;
(c) Sub-Committee on Customs Procedures;
(d) Sub-Committee on Investment;
(e) Sub-Committee on Trade in Services;
(f) Sub-Committee on Movement of Natural Persons;
(g) Sub-Committee on Energy and Mineral Resources;
(h) Sub-Committee on Intellectual Property;
(i) Sub-Committee on Government Procurement;
(j) Sub-Committee on Improvement of Business
Environment and Promotion of Business Confidence;
and
(k) Sub-Committee on Cooperation.
2. A Sub-Committee shall:
(a) be composed of representatives of the Governments
of the Parties and may, by mutual consent of the
Parties, invite representatives of relevant
entities other than the Governments of the
Parties with the necessary expertise relevant to
the issues to be discussed; and
(b) be co-chaired by officials of the Governments of
the Parties.
3. A Sub-Committee shall meet at such times and venues as
may be agreed upon by the Parties.
4. A Sub-Committee may, as necessary, establish its rules
and procedures.
5. A Sub-Committee may establish and delegate its
responsibilities to Working Groups.
Article 16
Communications
Each Party shall designate a contact point to
facilitate communications between the Parties on any matter
relating to this Agreement.
Chapter 2
Trade in Goods
Article 17
Definitions
For the purposes of this Chapter:
(a) the term “bilateral safeguard measure” means a
bilateral safeguard measure provided for in
paragraph 1 of Article 24;
(b) the term “customs value of goods” means the value
of goods for the purposes of levying ad valorem
customs duties on imported goods;
(c) the term “domestic industry” means the producers
as a whole of the like or directly competitive
goods operating in a Party, or those whose
collective output of the like or directly
competitive goods constitutes a major proportion
of the total domestic production of those goods;
(d) the term “export subsidies” means export
subsidies listed in subparagraphs 1(a) through
(f) of Article 9 of the Agreement on Agriculture
in Annex 1A to the WTO Agreement (hereinafter
referred to in this Chapter as “the Agreement on
Agriculture”);
(e) the term “originating goods” means goods which
qualify as originating goods under the provisions
of Chapter 3;
(f) the term “other duties or charges of any kind”
means those provided for in subparagraph 1(b) of
Article II of the GATT 1994;
(g) the term “provisional bilateral safeguard
measure” means a provisional bilateral safeguard
measure provided for in subparagraph 9(a) of
Article 24;
(h) the term “serious injury” means a significant
overall impairment in the position of a domestic
industry; and
(i) the term “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 18
Classification of Goods
The classification of goods in trade between the
Parties shall be in conformity with the Harmonized System.
Article 19
National Treatment
Each Party shall accord national treatment to the
goods of the other Party in accordance with Article III of
the GATT 1994.
Article 20
Elimination of Customs Duties
1. Except as otherwise provided for in this Agreement,
each Party shall eliminate or reduce its customs duties on
originating goods of the other Party designated for such
purposes in its Schedule in Annex 1, in accordance with the
terms and conditions set out in such Schedule.
2. Upon the request of either Party, the Parties shall
negotiate on issues such as improving market access
conditions on originating goods designated for negotiation
in the Schedule in Annex 1, in accordance with the terms
and conditions set out in such Schedule.
3. Each Party shall eliminate other duties or charges of
any kind imposed on or in connection with the importation
of goods of the other Party, if any. Neither Party shall
introduce other duties or charges of any kind imposed on or
in connection with the importation of goods of the other
Party.
4. Nothing in this Article shall prevent a Party from
imposing, at any time, on the importation of any good of
the other Party:
(a) a charge equivalent to an internal tax imposed
consistently with the provisions of paragraph 2
of Article III of the GATT 1994, in respect of
the like domestic good or in respect of a good
from which the imported good has been
manufactured or produced in whole or in part;
(b) any anti-dumping or countervailing duty applied
consistently with the provisions of Article VI of
the GATT 1994, the Agreement on Implementation of
Article VI of the General Agreement on Tariffs
and Trade 1994 in Annex 1A to the WTO Agreement,
and the Agreement on Subsidies and Countervailing
Measures in Annex 1A to the WTO Agreement; and
(c) fees or other charges commensurate with the cost
of services rendered.
5. If, as a result of the elimination or reduction of
its customs duty applied on a particular good on a mostfavoured-
nation basis, the most-favoured-nation applied
rate becomes equal to, or lower than, the rate of customs
duty to be applied in accordance with paragraph 1 on the
originating good which is classified under the same tariff
line as that particular good, each Party shall notify the
other Party of such elimination or reduction without delay.
6. In cases where its most-favoured-nation applied rate
of customs duty on a particular good is lower than the rate
of customs duty to be applied in accordance with paragraph
1 on the originating good which is classified under the
same tariff line as that particular good, each Party shall
apply the lower rate with respect to that originating good.
Article 21
Customs Valuation
For the purposes of determining the customs value of
goods traded between the Parties, provisions of Part I of
the Agreement on Implementation of Article VII of the
General Agreement on Tariffs and Trade 1994 in Annex 1A to
the WTO Agreement (hereinafter referred to as “the
Agreement on Customs Valuation”), shall apply mutatis
mutandis.
Article 22
Export Subsidies
Neither Party shall introduce or maintain any export
subsidies on any agricultural good which is listed in Annex
1 to the Agreement on Agriculture.
Article 23
Non-tariff Measures
Each Party shall not introduce or maintain any nontariff
measures on the importation of any good of the other
Party or on the exportation or sale for export of any good
destined for the other Party which are inconsistent with
its obligations under the WTO Agreement.
Article 24
Bilateral Safeguard Measures
1. Subject to the provisions of this Article, each Party
may, as a bilateral safeguard measure, to the minimum
extent necessary to prevent or remedy the serious injury to
a domestic industry of that Party and to facilitate
adjustment:
(a) suspend the further reduction of any rate of
customs duty on the originating good provided for
in this Chapter; or
(b) increase the rate of customs duty on the
originating good to a level not to exceed the
lesser of:
(i) the most-favoured-nation applied rate of
customs duty in effect at the time when the
bilateral safeguard measure is taken; and
(ii) the most-favoured-nation applied rate of
customs duty in effect on the day
immediately preceding the date of entry into
force of this Agreement,
if an originating good of the other Party, as a result of
the elimination or reduction of a customs duty in
accordance with Article 20, is being imported into the
former Party in such increased quantities, in absolute
terms or relative to domestic production, and under such
conditions that the imports of that originating good
constitute a substantial cause of serious injury, or threat
of serious injury, to a domestic industry of the former
Party.
2. Each Party shall not apply a bilateral safeguard
measure on an originating good imported up to the limit of
quota quantities granted under tariff rate quotas applied
in accordance with its Schedule in Annex 1.
3. (a) A Party may take a bilateral safeguard measure
only after an investigation has been carried out
by the competent authorities of that Party in
accordance with Article 3 and paragraph 2 of
Article 4 of the Agreement on Safeguards in Annex
1A to the WTO Agreement (hereinafter referred to
in this Article as “the Agreement on
Safeguards”).
(b) The investigation referred to in subparagraph (a)
shall in all cases be completed within one year
following its date of initiation.
4. The following conditions and limitations shall apply
with regard to a bilateral safeguard measure:
(a) A Party shall immediately deliver a written
notice to the other Party upon:
(i) initiating an investigation referred to in
subparagraph 3(a) relating to serious
injury, or threat of serious injury, and the
reasons for it; and
(ii) taking a decision to apply or extend a
bilateral safeguard measure.
(b) The Party making the written notice referred to
in subparagraph (a) shall provide the other Party
with all pertinent information, which shall
include:
(i) in the written notice referred to in
subparagraph (a)(i), the reason for the
initiation of the investigation, a precise
description of the originating good subject
to the investigation and its subheading of
the Harmonized System, the period subject to
the investigation and the date of initiation
of the investigation; and
(ii) in the written notice referred to in
subparagraph (a)(ii), evidence of serious
injury or threat of serious injury caused by
the increased imports of the originating
good, a precise description of the
originating good subject to the proposed
bilateral safeguard measure and its
subheading of the Harmonized System, a
precise description of the bilateral
safeguard measure, the proposed date of its
introduction and its expected duration.
(c) A Party proposing to apply or extend a bilateral
safeguard measure shall provide adequate
opportunity for prior consultations with the
other Party with a view to reviewing the
information arising from the investigation
referred to in subparagraph 3(a), exchanging
views on the bilateral safeguard measure and
reaching an agreement on compensation set out in
paragraph 5.
(d) No bilateral safeguard measure shall be
maintained except to the extent and for such time
as may be necessary to prevent or remedy serious
injury and to facilitate adjustment, provided
that such time shall not exceed a period of four
years. However, in very exceptional
circumstances, a bilateral safeguard measure may
be extended, provided that the total period of
the bilateral safeguard measure, including such
extensions, shall not exceed five years. In
order to facilitate adjustment in a situation
where the expected duration of a bilateral
safeguard measure is over one year, the Party
maintaining the bilateral safeguard measure shall
progressively liberalize the bilateral safeguard
measure at regular intervals during the period of
application.
(e) No bilateral safeguard measure shall be applied
again to the import of a particular originating
good which has been subject to such a bilateral
safeguard measure, for a period of time equal to
the duration of the previous bilateral safeguard
measure or one year, whichever is longer.
(f) Upon the termination of a bilateral safeguard
measure, the rate of customs duty shall be the
rate which would have been in effect but for the
bilateral safeguard measure.
5. (a) A Party proposing to apply or extend a bilateral
safeguard measure shall provide to the other
Party mutually agreed adequate means of trade
compensation in the form of concessions of
customs duties whose levels are substantially
equivalent to the value of the additional customs
duties expected to result from the bilateral
safeguard measure.
(b) If the Parties are unable to agree on the
compensation within 30 days after the
commencement of the consultation pursuant to
subparagraph 4(c), the Party against whose
originating good the bilateral safeguard measure
is taken shall be free to suspend the application
of concessions of customs duties under this
Agreement, which are substantially equivalent to
the bilateral safeguard measure. The Party
exercising the right of suspension may suspend
the application of concessions of customs duties
only for the minimum period necessary to achieve
the substantially equivalent effects and only
while the bilateral safeguard measure is
maintained.
6. Nothing in this Chapter shall prevent a Party from
applying safeguard measures to an originating good in
accordance with:
(a) Article XIX of the GATT 1994 and the Agreement on
Safeguards; or
(b) Article 5 of the Agreement on Agriculture.
7. Each Party shall ensure the consistent, impartial and
reasonable administration of its laws and regulations
relating to the bilateral safeguard measure.
8. Each Party shall adopt or maintain equitable, timely,
transparent and effective procedures relating to the
bilateral safeguard measure.
9. (a) In critical circumstances, where delay would
cause damage which it would be difficult to
repair, a Party may take a provisional bilateral
safeguard measure, which shall take the form of
the measure set out in subparagraph 1(a) or (b)
pursuant to a preliminary determination that
there is clear evidence that increased imports of
an originating good have caused or are
threatening to cause serious injury to a domestic
industry.
(b) A Party shall deliver a written notice to the
other Party prior to applying a provisional
bilateral safeguard measure. Consultations
between the Parties on the application of the
provisional bilateral safeguard measure shall be
initiated immediately after the provisional
bilateral safeguard measure is taken.
(c) The duration of the provisional bilateral
safeguard measure shall not exceed 200 days.
During that period, the pertinent requirements of
paragraph 3 shall be met. The duration of the
provisional bilateral safeguard measure shall be
counted as a part of the period referred to in
subparagraph 4(d).
(d) Subparagraph 4(f) and paragraphs 7 and 8 shall be
applied mutatis mutandis to the provisional
bilateral safeguard measure. The customs duty
imposed as a result of the provisional bilateral
safeguard measure shall be refunded if the
subsequent investigation referred to in
subparagraph 3(a) does not determine that
increased imports of the originating good have
caused or threatened to cause serious injury to a
domestic industry.
10. Written notice referred to in subparagraphs 4(a) and
9(b) and any other communication between the Parties shall
be done in the English language.
11. The Parties shall review the provisions of this
Article, if necessary, five years after the date of entry
into force of this Agreement, unless otherwise agreed by
the Parties.
Article 25
Restrictions to Safeguard the Balance of Payments
1. Nothing in this Chapter shall be construed to prevent
a Party from taking any measure for balance-of-payments
purposes. A Party taking such measure shall do so in
accordance with the conditions established under Article
XII of the GATT 1994 and the Understanding on the Balance of-
Payments Provisions of the General Agreement on Tariffs
and Trade 1994 in Annex 1A to the WTO Agreement.
2. Nothing in this Chapter shall preclude the use by a
Party of exchange controls or exchange restrictions in
accordance with the Articles of Agreement of the
International Monetary Fund.
Article 26
Sub-Committee on Trade in Goods
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Trade in Goods (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee;
(d) reviewing and making appropriate recommendations,
as necessary, to the Joint Committee on the
Operational Procedures for Trade in Goods
referred to in Article 27; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Article 27
Operational Procedures for Trade in Goods
Upon the date of entry into force of this Agreement,
the Joint Committee shall adopt the Operational Procedures
for Trade in Goods that provide detailed regulations
pursuant to which the relevant authorities of the Parties
shall implement their functions under this Chapter.
Chapter 3
Rules of Origin
Article 28
Definitions
For the purposes of this Chapter:
(a) the term “competent governmental authority” means
the authority that, according to the legislation
of each Party, is responsible for the issuing of
a certificate of origin or for the designation of
certification entities or bodies. In the case of
Japan, the Ministry of Economy, Trade and
Industry and in the case of Indonesia, the
Ministry of Trade;
(b) the term “exporter” means a person located in an
exporting Party who exports a good from the
exporting Party in accordance with the applicable
laws and regulations of the exporting Party;
(c) the term “factory ships of the Party” or “vessels
of the Party” respectively means factory ships or
vessels:
(i) which are registered in the Party;
(ii) which sail under the flag of the Party;
(iii) which are owned to an extent of at least 50
percent by nationals of the Parties, or by a
juridical person with its head office in
either Party, of which the representatives,
chairman of the board of directors, and the
majority of the members of such board are
nationals of the Parties, and of which at
least 50 percent of the equity interest is
owned by nationals or juridical persons of
the Parties; and
(iv) of which at least 75 percent of the total of
the master, officers and crew are nationals
of the Parties;
(d) the term “fungible originating goods of a Party”
or “fungible originating materials of a Party”
respectively means originating goods or materials
of a Party that are interchangeable for
commercial purposes, whose properties are
essentially identical;
(e) the term “Generally Accepted Accounting
Principles” means the recognized consensus or
substantial authoritative support within 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;
(f) the term “importer” means a person who imports a
good into the importing Party in accordance with
the applicable laws and regulations of the
importing Party;
(g) the term “indirect materials” means goods used in
the production, testing or inspection of another
good but not physically incorporated into the
good, or goods used in the maintenance of
buildings or the operation of equipment
associated with the production of another good,
including:
(i) fuel and energy;
(ii) tools, dies and moulds;
(iii) spare parts and goods used in the
maintenance of equipment and buildings;
(iv) lubricants, greases, compounding materials
and other goods used in production or used
to operate equipment and buildings;
(v) gloves, glasses, footwear, clothing, safety
equipment and supplies;
(vi) equipment, devices and supplies used for
testing or inspection;
(vii) catalysts and solvents; and
(viii) any other goods that are not incorporated
into another good but whose use in the
production of the good can reasonably be
demonstrated to be a part of that
production;
(h) the term “material” means a good that is used in
the production of another good;
(i) the term “originating material of a Party” means
an originating good of a Party which is used in
the production of another good in the Party,
including that which is considered as an
originating material of the Party pursuant to
paragraph 1 of Article 30;
(j) the term “packing materials and containers for
shipment” means goods that are normally used to
protect a good during transportation, other than
packaging materials and containers for retail
sale referred to in Article 38;
(k) the term “preferential tariff treatment” means
the rate of customs duties applicable to an
originating good of the exporting Party in
accordance with paragraph 1 of Article 20; and
(l) the term “production” means a method of obtaining
goods including manufacturing, assembling,
processing, raising, growing, breeding, mining,
extracting, harvesting, fishing, trapping,
gathering, collecting, hunting and capturing.
Article 29
Originating Goods
1. Except as otherwise provided for in this Chapter, a
good shall qualify as an originating good of a Party where:
(a) the good is wholly obtained or produced entirely
in the Party, as defined in paragraph 2;
(b) the good is produced entirely in the Party
exclusively from originating materials of the
Party; or
(c) the good satisfies the product specific rules set
out in Annex 2, as well as all other applicable
requirements of this Chapter, when the good is
produced entirely in the Party using nonoriginating
materials.
2. For the purposes of subparagraph 1(a), the following
goods shall be considered as being wholly obtained or
produced entirely in a Party:
(a) live animals born and raised in the Party;
(b) animals obtained by hunting, trapping, fishing,
gathering or capturing in the Party;
(c) goods obtained from live animals in the Party;
(d) plants and plant products harvested, picked or
gathered in the Party;
(e) minerals and other naturally occurring
substances, not included in subparagraphs (a)
through (d), extracted or taken in the Party;
(f) goods of sea-fishing and other goods taken by
vessels of the Party from the sea outside the
other Party;
(g) goods produced on board factory ships of the
Party outside the other Party from the goods
referred to in subparagraph (f);
(h) goods taken from the sea-bed or subsoil beneath
the sea-bed outside the Party, provided that the
Party has rights to exploit such sea-bed or
subsoil;
(i) articles collected in the Party which can no
longer perform their original purpose in the
Party nor are capable of being restored or
repaired and which are fit only for disposal or
for the recovery of parts or raw materials;
(j) scrap and waste derived from manufacturing or
processing operations or from consumption in the
Party and fit only for disposal or for the
recovery of raw materials;
(k) parts or raw materials recovered in the Party
from articles which can no longer perform their
original purpose nor are capable of being
restored or repaired; and
(l) goods obtained or produced in the Party
exclusively from the goods referred to in
subparagraphs (a) through (k).
3. For the purposes of subparagraph 1(c), the product
specific rules set out in Annex 2 requiring that the
materials used undergo a change in tariff classification or
a specific manufacturing or processing operation shall
apply only to non-originating materials.
4. (a) For the purposes of subparagraph 1(c), the
product specific rules set out in Annex 2 using
the value-added method require that the
qualifying value content of a good, calculated in
accordance with subparagraph (b), is not less
than the percentage specified by the rule for the
good.
(b) For the purposes of calculating the qualifying
value content of a good, the following formula
shall be applied:
F.O.B. – V.N.M.
Q.V.C. = ------------------- x 100
F.O.B.
Where:
Q.V.C. is the qualifying value content of a good,
expressed as a percentage;
F.O.B. is, except as provided for in paragraph 5,
the free-on-board value of a good payable by the
buyer of the good to the seller of the good,
regardless of the mode of shipment, not including
any internal excise taxes reduced, exempted, or
repaid when the good is exported; and
V.N.M. is the value of non-originating materials
used in the production of a good.
5. F.O.B. referred to in subparagraph 4(b) shall be the
value:
(a) adjusted to the first ascertainable price paid
for a good from the buyer to the producer of the
good, if there is free-on-board value of the
good, but it is unknown and cannot be
ascertained; or
(b) determined in accordance with Articles 1 through
8 of the Agreement on Customs Valuation, if there
is no free-on-board value of a good.
6. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b), the value of a
non-originating material used in the production of the good
in a Party:
(a) shall be determined in accordance with the
Agreement on Customs Valuation, and shall include
freight, insurance where appropriate, packing and
all the other costs incurred in transporting the
material to the importation port in the Party
where the producer of the good is located; or
(b) if such value is unknown and cannot be
ascertained, shall be the first ascertainable
price paid for the material in the Party, but may
exclude all the costs incurred in the Party in
transporting the material from the warehouse of
the supplier of the material to the place where
the producer is located such as freight,
insurance and packing as well as any other known
and ascertainable cost incurred in the Party.
7. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b) in determining
whether the good qualifies as an originating good of a
Party, V.N.M. of the good shall not include the value of
non-originating materials used in the production of
originating materials of the Party which are used in the
production of the good.
8. For the purposes of subparagraph 5(b) or 6(a), in
applying the Agreement on Customs Valuation to determine
the value of a good or non-originating material, the
Agreement on Customs Valuation shall apply mutatis mutandis
to domestic transactions or to the cases where there is no
transaction of the good or non-originating material.
Article 30
Accumulation
1. For the purposes of determining whether a good
qualifies as an originating good of a Party, an originating
good of the other Party which is used as a material in the
production of the good in the former Party may be
considered as an originating material of the former Party.
2. For the purposes of calculating the qualifying value
content of a good under subparagraph 4(b) of Article 29 in
determining whether the good qualifies as an originating
good of a Party, the value of a non-originating material
produced in either Party and to be used in the production
of the good may be limited to the value of non-originating
materials used in the production of such non-originating
material, provided that the good qualifies as an
originating good of that Party under subparagraph 1(c) of
Article 29.
Article 31
De Minimis
For the application of the product specific rules set
out in Annex 2, non-originating materials used in the
production of a good that do not satisfy an applicable rule
for the good, shall be disregarded, provided that the
totality of such materials does not exceed specific
percentages in value, weight or volume of the good and such
percentages are set out in the product specific rule for
the good.
Article 32
Non-qualifying Operations
A good shall not be considered to satisfy the
requirement of change in tariff classification or specific
manufacturing or processing operation set out in Annex
2 merely by reason of:
(a) operations to ensure the preservation of products
in good condition during transport and storage
(such as drying, freezing, keeping in brine) and
other similar operations;
(b) changes of packaging and breaking up and assembly
of packages;
(c) disassembly;
(d) placing in bottles, cases, boxes and other simple
packaging operations;
(e) collection of parts and components classified as
a good pursuant to Rule 2(a) of the General Rules
for the Interpretation of the Harmonized System;
(f) mere making-up of sets of articles; or
(g) any combination of operations referred to in
subparagraphs (a) through (f).
Article 33
Consignment Criteria
1. An originating good of the other Party shall be deemed
to meet the consignment criteria when it is:
(a) transported directly from the other Party; or
(b) transported through one or more non-Parties for
the purpose of transit or temporary storage in
warehouses in such non-Parties, provided that it
does not undergo operations other than unloading,
reloading and any other operation to preserve it
in good condition.
2. If an originating good of the other Party does not
meet the consignment criteria referred to in paragraph 1,
that good shall not be considered as an originating good of
the other Party.
Article 34
Unassembled or Disassembled Goods
1. Where a good satisfies the requirements of the
relevant provisions of Articles 29 through 32 and is
imported into a Party from the other Party in an
unassembled or disassembled form but is classified as an
assembled good pursuant to Rule 2(a) of the General Rules
for the Interpretation of the Harmonized System, such a
good shall be considered as an originating good of the
other Party.
2. A good assembled in a Party from unassembled or
disassembled materials, which were imported into the Party
and classified as an assembled good pursuant to Rule 2(a)
of the General Rules for the Interpretation of the
Harmonized System, shall be considered as an originating
good of the Party, provided that the good would have
satisfied the applicable requirements of the relevant
provisions of Articles 29 through 32 had each of the nonoriginating
materials among the unassembled or disassembled
materials been imported into the Party separately and not
as an unassembled or disassembled form.
Article 35
Fungible Goods and Materials
1. For the purposes of determining whether a good
qualifies as an originating good of a Party, where fungible
originating materials of the Party and fungible nonoriginating
materials that are commingled in an inventory
are used in the production of the good, the origin of the
materials may be determined pursuant to an inventory
management method under the Generally Accepted Accounting
Principles in the Party.
2. Where fungible originating goods of a Party and
fungible non-originating goods are commingled in an
inventory and, prior to exportation do not undergo any
production process or any operation in the Party where they
were commingled other than unloading, reloading and any
other operation to preserve them in good condition, the
origin of the good may be determined pursuant to an
inventory management method under the Generally Accepted
Accounting Principles in the Party.
Article 36
Indirect Materials
Indirect materials shall be, without regard to where
they are produced, considered to be originating materials
of a Party where the good is produced.
Article 37
Accessories, Spare Parts and Tools
1. In determining whether all the non-originating
materials used in the production of a good undergo the
applicable change in tariff classification or a specific
manufacturing or processing operation set out in Annex 2,
accessories, spare parts or tools delivered with the good
that form part of the good's standard accessories, spare
parts or tools, shall be disregarded, provided that:
(a) the accessories, spare parts or tools are not
invoiced separately from the good, without regard
of whether they are separately described in the
invoice; and
(b) the quantities and value of the accessories,
spare parts or tools are customary for the good.
2. If a good is subject to a qualifying value content
requirement, the value of the accessories, spare parts or
tools shall be taken into account as the value of
originating materials of a Party where the good is produced
or non-originating materials, as the case may be, in
calculating the qualifying value content of the good.
Article 38
Packaging Materials and Containers for Retail Sale
1. In determining whether all the non-originating
materials used in the production of a good undergo the
applicable change in tariff classification or a specific
manufacturing or processing operation set out in Annex 2,
packaging materials and containers for retail sale, which
are classified with the good pursuant to Rule 5 of the
General Rules for the Interpretation of the Harmonized
System, shall be disregarded.
2. If a good is subject to a qualifying value content
requirement, the value of packaging materials and
containers for retail sale shall be taken into account as
the value of originating materials of a Party where the
good is produced or non-originating materials, as the case
may be, in calculating the qualifying value content of the
good.
Article 39
Packing Materials and Containers for Shipment
Packing materials and containers for shipment shall
be:
(a) disregarded in determining whether all the nonoriginating
materials used in the production of a
good undergo the applicable change in tariff
classification or a specific manufacturing or
processing operation set out in Annex 2; and
(b) without regard to where they are produced,
considered to be originating materials of a Party
where the good is produced, in calculating the
qualifying value content of the good.
Article 40
Claim for Preferential Tariff Treatment
1. The importing Party shall require a certificate of
origin for an originating good of the exporting Party from
importers who claim the preferential tariff treatment for
the good.
2. Notwithstanding paragraph 1, the importing Party shall
not require a certificate of origin from importers for an
importation of a consignment of originating goods of the
exporting Party whose aggregate customs value does not
exceed 200 United States dollars or its equivalent amount
in the Party’s currency, or such higher amount as it may
establish.
3. Where an originating good of the exporting Party is
imported through one or more non-Parties, the importing
Party may require importers, who claim the preferential
tariff treatment for the good, to submit:
(a) a copy of through bill of lading; or
(b) a certificate or any other information given by
the customs authorities of such non-Parties or
other relevant entities, which evidences that the
good has not undergone operations other than
unloading, reloading and any other operation to
preserve it in good condition in those non-Parties.
Article 41
Certificate of Origin
1. A certificate of origin referred to in paragraph 1 of
Article 40 shall be issued by the competent governmental
authority of the exporting Party on request having been
made in writing by the exporter or its authorized agent.
Such certificate of origin shall include minimum data
specified in Annex 3.
2. For the purposes of this Article, the competent
governmental authority of the exporting Party may designate
other entities or bodies to be responsible for the issuance
of certificate of origin, under the authorization given in
accordance with the applicable laws and regulations of the
exporting Party.
3. Where the competent governmental authority of the
exporting Party designates other entities or bodies to
carry out the issuance of certificate of origin, the
exporting Party shall notify in writing the other Party of
its designees.
4. For the purposes of this Chapter, upon the entry into
force of this Agreement, the Parties shall establish a
format of certificate of origin in the English language in
the Operational Procedures for Rules of Origin referred to
in Article 50.
5. A certificate of origin shall be completed in the
English language.
6. An issued certificate of origin shall be applicable to
a single importation of an originating good of the
exporting Party into the importing Party and be valid for
12 months from the date of issuance.
7. Where the exporter of a good is not the producer of
the good in the exporting Party, the exporter may request a
certificate of origin on the basis of:
(a) a declaration provided by the exporter to the
competent governmental authority of the exporting
Party or its designees based on the information
provided by the producer of the good to that
exporter; or
(b) a declaration voluntarily provided by the
producer of the good directly to the competent
governmental authority of the exporting Party or
its designees by the request of the exporter in
accordance with the applicable laws and
regulations of the exporting Party.
8. A certificate of origin shall be issued only after the
exporter who requests the certificate of origin, or the
producer of a good in the exporting Party referred to in
subparagraph 7(b), proves to the competent governmental
authority of the exporting Party or its designees that the
good to be exported qualifies as an originating good of the
exporting Party.
9. The competent governmental authority of the exporting
Party shall provide the other Party with specimen
signatures and impressions of stamps used in the offices of
the competent governmental authority or its designees.
10. Each Party shall ensure that the competent
governmental authority or its designees shall keep a record
of issued certificate of origin for a period of five years
after the date on which the certificate was issued. Such
record will include all antecedents, which were presented
to prove the qualification as an originating good of the
exporting Party.
Article 42
Obligations regarding Exportations
Each Party shall, in accordance with its laws and
regulations, ensure that the exporter to whom a certificate
of origin has been issued, or the producer of a good in
the exporting Party referred to in subparagraph 7(b) of
Article 41:
(a) shall notify in writing the competent
governmental authority of the exporting Party or
its designees without delay when such exporter or
producer knows that such good does not qualify as
an originating good of the exporting Party; and
(b) shall keep the records relating to the origin of
the good for five years after the date on which
the certificate of origin was issued.
Article 43
Request for Checking of Certificate of Origin
1. For the purposes of determining whether a good
imported from the exporting Party under preferential tariff
treatment qualifies as an originating good of the exporting
Party, the customs authority of the importing Party may
request information relating to the origin of the good from
the competent governmental authority of the exporting Party
on the basis of the certificate of origin.
2. For the purposes of paragraph 1, the competent
governmental authority of the exporting Party shall, in
accordance with the laws and regulations of the Party,
provide the information requested in a period not exceeding
six months after the date of receipt of the request.
If the customs authority of the importing Party
considers necessary, it may require additional information
relating to the origin of the good. If additional
information is requested by the customs authority of the
importing Party, the competent governmental authority of
the exporting Party shall, in accordance with the laws and
regulations of the exporting Party, provide the information
requested in a period not exceeding four months after the
date of receipt of the request.
3. For the purposes of paragraph 2, the competent
governmental authority of the exporting Party may request
the exporter to whom the certificate of origin has been
issued, or the producer of the good in the exporting Party
referred to in subparagraph 7(b) of Article 41, to provide
the former with the information requested.
Article 44
Verification Visit
1. If the customs authority of the importing Party is not
satisfied with the outcome of the request for checking
pursuant to Article 43, it may request the exporting Party:
40
(a) to collect and provide information relating to
the origin of the good and check, for that
purpose, the facilities used in the production of
the good, through a visit by the competent
governmental authority of the exporting Party
along with the customs authority of the importing
Party, which may be accompanied by other
government officials with necessary expertise of
the importing Party, to the premises of the
exporter to whom the certificate of origin has
been issued, or the producer of the good in the
exporting Party referred to in subparagraph 7(b)
of Article 41; and
(b) during or after the visit, to provide information
relating to the origin of the good in the
possession of the competent governmental
authority of the exporting Party or its
designees.
2. When requesting the exporting Party to conduct a visit
pursuant to paragraph 1 or 6, the customs authority of the
importing Party shall deliver a written communication with
such request to the exporting Party at least 40 days in
advance of the proposed date of the visit, the receipt of
which is to be confirmed by the exporting Party. The
competent governmental authority of the exporting Party
shall request the written consent of the exporter, or the
producer of the good in the exporting Party, whose premises
are to be visited.
3. The communication referred to in paragraph 2 shall
include:
(a) the identity of the customs authority of the
importing Party issuing the communication;
(b) the name of the exporter, or the producer of the
good in the exporting Party, whose premises are
requested to be visited;
(c) the proposed date and place of the visit;
(d) the objective and scope of the proposed visit,
including specific reference to the good subject
of the verification referred to in the
certificate of origin; and
(e) the names and titles of the officials of the
customs authority and other government officials
with necessary expertise of the importing Party
to be present during the visit.
4. The exporting Party shall respond in writing to the
importing Party, within 30 days of the receipt of the
communication referred to in paragraph 2, if it accepts or
refuses to conduct the visit requested pursuant to
paragraph 1 or 6.
5. The competent governmental authority of the exporting
Party shall, in accordance with the laws and regulations of
the Party, provide within 45 days or any other mutually
agreed period from the last day of the visit, to the
customs authority of the importing Party the information
obtained pursuant to paragraph 1 or 6.
6. (a) In cases where the customs authority of the
importing Party considers as exceptional, that
customs authority may, before or during the
request for checking referred to in Article 43,
put forward the exporting Party a request
referred to in paragraph 1.
(b) Where the request referred to in subparagraph (a)
is made, Article 43 shall not be applied.
Article 45
Determination of Origin
and Preferential Tariff Treatment
1. The customs authority of the importing Party may deny
preferential tariff treatment to a good for which an
importer claims preferential tariff treatment where the
good does not qualify as an originating good of the
exporting Party or where the importer fails to comply with
any of the relevant requirements of this Chapter.
2. The competent governmental authority of the exporting
Party shall, when it cancels the decision to issue the
certificate of origin, promptly notify the cancellation to
the exporter to whom the certificate of origin has been
issued, and to the customs authority of the importing Party
except where the certificate has been returned to the
competent governmental authority. The customs authority of
the importing Party may determine that the good does not
qualify as an originating good of the exporting Party and
may deny preferential tariff treatment where it receives
the notification.
3. The customs authority of the importing Party may
determine that a good does not qualify as an originating
good of the exporting Party and may deny preferential
tariff treatment, and a written determination thereof shall
be sent to the competent governmental authority of the
exporting Party:
(a) where the competent governmental authority of the
exporting Party fails to respond to the request
within the period referred to in paragraph 2 of
Article 43 or paragraph 5 of Article 44;
(b) where the exporting Party refuses to conduct a
visit, or that Party fails to respond to the
communication referred to in paragraph 2 of
Article 44 within the period referred to in
paragraph 4 of Article 44; or
(c) where the information provided to the customs
authority of the importing Party pursuant to
Article 43 or 44, is not sufficient to prove that
the good qualifies as an originating good of the
exporting Party.
4. After carrying out the procedures outlined in Article
43 or 44 as the case may be, the customs authority of the
importing Party shall provide the competent governmental
authority of the exporting Party with a written
determination of whether or not the good qualifies as an
originating good of the exporting Party, including findings
of fact and the legal basis for the determination. The
competent governmental authority of the exporting Party
shall inform such determination by the customs authority of
the importing Party to the exporter, or the producer of the
good in the exporting Party, whose premises were subject to
the visit referred to in Article 44.
Article 46
Confidentiality
1. Each Party shall maintain, in accordance with its laws
and regulations, the confidentiality of information
provided to it as confidential pursuant to this Chapter,
and shall protect that information from disclosure that
could prejudice the competitive position of the persons
providing the information.
2. Information obtained by the customs authority of the
importing Party pursuant to this Chapter:
(a) may only be used by such authority for the
purposes of this Chapter; and
(b) shall not be used by the importing Party in any
criminal proceedings carried out by a court or a
judge, unless the information is requested to the
exporting Party and provided to the importing
Party, through the diplomatic channels or other
channels established in accordance with the
applicable laws of the exporting Party.
Article 47
Penalties and Measures against False Declaration
1. Each Party shall establish or maintain, in accordance
with its laws and regulations, appropriate penalties or
other sanctions against its exporters to whom a certificate
of origin has been issued and the producers of the good in
the exporting Party referred to in subparagraph 7(b) of
Article 41, for providing false declaration or documents to
the competent governmental authority of the exporting Party
or its designees prior to the issuance of certificate of
origin.
2. Each Party shall, in accordance with its laws and
regulations, take measures which it considers appropriate
against its exporters to whom a certificate of origin has
been issued and the producers of the good in the exporting
Party referred to in subparagraph 7(b) of Article 41, for
failing to notify in writing to the competent governmental
authority of the exporting Party or its designees without
delay after having known, after the issuance of certificate
of origin, that such good does not qualify as an
originating good of the exporting Party.
Article 48
Miscellaneous
1. Communications between the importing Party and the
exporting Party shall be conducted in the English language.
2. For the application of the relevant product specific
rules set out in Annex 2 and the determination of origin,
the Generally Accepted Accounting Principles in the
exporting Party shall be applied.
Article 49
Sub-Committee on Rules of Origin
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Rules of Origin (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and making appropriate recommendations,
as necessary, to the Joint Committee on:
(i) the implementation and operation of this
Chapter;
(ii) any amendments to Annex 2 or 3, proposed by
either Party; and
(iii) the Operational Procedures for Rules of
Origin referred to in Article 50;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Article 50
Operational Procedures for Rules of Origin
Upon the date of entry into force of this Agreement,
the Joint Committee shall adopt the Operational Procedures
for Rules of Origin that provide detailed regulations
pursuant to which the customs authorities, the competent
governmental authorities and other relevant authorities of
the Parties shall implement their functions under this
Chapter.
Chapter 4
Customs Procedures
Article 51
Scope
1. This Chapter shall apply to customs procedures
required for the clearance of goods traded between the
Parties.
2. This Chapter shall be implemented by the Parties in
accordance with the laws and regulations of each Party and
within the competence and available resources of their
respective customs authorities.
Article 52
Definition
For the purposes of this Chapter, the term “customs
laws” means the statutory and regulatory provisions
relating to the importation, exportation, movement or
storage of goods, the administration and enforcement of
which are specifically charged to the customs authority of
each Party, and any regulations made by the customs
authority of each Party under its statutory power.
Article 53
Transparency
1. Each Party shall ensure that all relevant information
of general application pertaining to its customs laws is
publicly available.
2. When information that has been made available must be
amended due to changes in its customs laws, each Party
shall endeavor to make the revised information readily
available sufficiently in advance of the entry into force
of the changes to enable interested persons to take account
of them, unless advance notice is precluded.
3. Each Party shall, wherever appropriate, provide, as
quickly and as accurately as possible, information relating
to the specific customs matters raised by any interested
person of the Parties and pertaining to its customs laws.
The Party shall endeavor to supply any other pertinent
information which it considers the interested person should
be made aware of.
Article 54
Customs Clearance
1. Both Parties shall apply their respective customs
procedures in a predictable, consistent and transparent
manner.
2. For the accomplishment of the purposes of paragraph 1,
each Party shall:
(a) make use of information and communications
technology;
(b) simplify its customs procedures;
(c) harmonize its customs procedures, as far as
possible, with relevant international standards
and recommended practices such as those made
under the auspices of the Customs Co-operation
Council; and
(d) promote cooperation, wherever appropriate,
between its customs authority and:
(i) other national authorities of the Party; and
(ii) the trading communities of the Party.
3. Each Party shall provide affected parties with
accessible processes of administrative and judicial review
in relation to the action concerning the customs matters
taken by the Party.
Article 55
Cooperation and Exchange of Information
1. The Parties shall cooperate and exchange information
with each other, in the field of customs procedures,
including their enforcement against the trafficking of
restricted and prohibited goods and the importation and
exportation of goods suspected of infringing intellectual
property rights.
2. Such cooperation and exchange of information shall be
implemented as provided for in the Implementing Agreement.
Article 56
Sub-Committee on Customs Procedures
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Customs Procedures (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing the implementation and operation of
this Chapter;
(b) identifying areas, relating to this Chapter, to
be improved for facilitating trade between the
Parties;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
2. Further to paragraph 2 of Article 15, the composition
of the Sub-Committee shall be specified in the Implementing
Agreement.
Chapter 5
Investment
Article 57
Scope
1. This Chapter shall apply to measures adopted or
maintained by a Party relating to:
(a) investors of the other Party; and
(b) investments of investors of the other Party in
the Area of the former Party.
2. In the event of any inconsistency between this Chapter
and Chapter 6:
(a) with respect to matters covered by Articles 59,
60 and 63, Chapter 6 shall prevail to the extent
of inconsistency; and
(b) with respect to matters not falling under
subparagraph (a), this Chapter shall prevail to
the extent of inconsistency.
3. This Chapter shall not apply to measures affecting the
movement of natural persons of a Party.
Article 58
Definitions
For the purposes of this Chapter:
(a) the term “enterprise” means any legal person or
any other entity duly constituted or organized
under applicable laws and regulations, whether
for profit or otherwise, and whether privately owned
or controlled or governmentally-owned or
controlled, including any corporation, trust,
partnership, joint venture, sole proprietorship,
organization or company;
(b) an enterprise is:
(i) “owned” by an investor if more than 50
percent of the equity interests in it is
beneficially owned by the investor; and
(ii) “controlled” by an investor if the investor
has the power to name a majority of its
directors or otherwise to legally direct its
actions;
(c) the term “enterprise of the other Party” means an
enterprise constituted or organized under the
applicable laws and regulations of the other
Party;
(d) the term “financial services” means financial
services as defined in subparagraph 2(a)(i) of
Section 1 of Annex 7;
(e) the term “freely convertible currencies” means
currencies which are, in fact, widely used to
make payments for international transactions and
are widely traded in the principal exchange
markets;
(f) the term “investments” means every kind of asset
invested by an investor, in accordance with
applicable laws and regulations, including,
though not exclusively:
(i) an enterprise and a branch of an enterprise;
(ii) shares, stocks or other forms of equity
participation in an enterprise, including
rights derived there from;
(iii) bonds, debentures, loans and other forms of
debt, including rights derived there from;
(iv) rights under contracts, including turnkey,
construction, management, production or
revenue-sharing contracts;
(v) claims to money and claims to any
performance under contract having a
financial value;
(vi) intellectual property rights, including
copyrights, patent rights and rights
relating to utility models, trademarks,
industrial designs, layout-designs of
integrated circuits, new varieties of
plants, trade names, indications of source
or geographical indications and undisclosed
information;
(vii) rights conferred pursuant to laws and
regulations or contracts such as
concessions, licenses, authorizations and
permits; and
(viii) any other tangible and intangible, movable
and immovable property, and any related
property rights, such as leases, mortgages,
liens and pledges;
Note 1: Investments also include amounts yielded by
investments, in particular, profit, interest,
capital gains, dividends, royalties and fees.
A change in the form in which assets are
invested does not affect their character as
investments.
Note 2: For the purposes of subparagraphs (ii) and
(iii), a Party may, on a non-discriminatory
basis, exclude portfolio investments which
are determined by the use of the nondiscriminatory
and objective criteria adopted
by the Party.
(g) the term “investment activities” means
establishment, acquisition, expansion,
management, conduct, operation, maintenance, use,
enjoyment and sale or other disposition of
investments;
(h) the term “investor of the other Party” means a
national or an enterprise of the other Party;
(i) the term “national of the other Party” means a
natural person having the nationality of the
other Party in accordance with the applicable
laws and regulations of the other Party;
(j) the term “New York Convention” means the United
Nations Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, done at
New York, June 10, 1958; and
(k) the term “transfers” means transfers and
international payments.
Article 59
National Treatment
1. Each Party shall accord to investors of the other
Party and to their investments treatment no less favourable
than that it accords in like circumstances to its own
investors and to their investments with respect to
investment activities.
2. Notwithstanding paragraph 1, each Party may prescribe
special formalities in connection with investment
activities of investors of the other Party in its Area,
provided that such formalities do not materially impair the
protection afforded by the former Party to investors of the
other Party and to their investments pursuant to this Chapter.
Article 60
Most-Favoured-Nation Treatment
Each Party shall accord to investors of the other
Party and to their investments treatment no less favourable
than that it accords in like circumstances to investors of
a non-Party and to their investments with respect to
investment activities.
Article 61
General Treatment
Each Party shall accord to investments of investors of
the other Party fair and equitable treatment and full
protection and security.
Article 62
Access to the Courts of Justice
Each Party shall in its Area accord to investors of
the other Party treatment no less favourable than that it
accords in like circumstances to its own investors or
investors of a non-Party, with respect to access to its
courts of justice and administrative tribunals and agencies
in all degrees of jurisdiction, both in pursuit and in
defense of such investors’ rights.
Article 63
Prohibition of Performance Requirements
1. Neither Party shall impose or enforce any of the
following requirements, in connection with investment
activities in its Area of an investor of the other Party:
(a) to export a given level or percentage of goods or
services;
(b) to achieve a given level or percentage of
domestic content;
(c) to purchase, use or accord a preference to goods
produced or services provided in its Area, or to
purchase goods or services from natural or legal
persons or any other entity in its Area;
(d) to relate in any way the volume or value of
imports to the volume or value of exports or to
the amount of foreign exchange inflows associated
with investments of the investor;
(e) to restrict sales of goods or services in its
Area that investments of the investor produce or
provide by relating such sales in any way to the
volume or value of its exports or foreign
exchange earnings;
(f) to appoint, as executives or members of board of
directors, individuals of any particular
nationality;
(g) to locate the headquarters of the investor for a
specific region or the world market in its Area;
(h) to achieve a given level or value of research and
development in its Area; or
(i) to supply to a specific region or the world
market exclusively from its Area, one or more of
the goods that the investor produces or the
services that the investor provides.
2. Paragraph 1 does not preclude either Party from
conditioning the receipt or continued receipt of an
advantage, in connection with investment activities in its
Area of an investor of the other Party, on compliance with
any of the requirements set forth in subparagraphs 1 (g)
through (i).
Article 64
Reservations and Exceptions
1. Articles 59, 60 and 63 shall not apply to:
(a) any non-conforming measure that is maintained by
the following on the date of entry into force of
this Agreement, with respect to the sectors or
matters specified in Annex 4:
(i) the central government of a Party; or
(ii) a prefecture of Japan or a province of
Indonesia;
(b) any non-conforming measure that is maintained by
a local government other than a prefecture and a
province referred to in subparagraph (a)(ii) on
the date of entry into force of this Agreement;
(c) the continuation or prompt renewal of any nonconforming
measure referred to in subparagraphs
(a) and (b); or
(d) an amendment or modification to any nonconforming
measure referred to in subparagraphs
(a) and (b), provided that the amendment or
modification does not decrease the conformity of
the measure, as it existed immediately before the
amendment or modification, with Articles 59, 60
and 63.
2. Each Party shall, on the date of entry into force of
this Agreement, notify the other Party of the following
information on any non-conforming measure referred to in
subparagraph 1(a):
(a) the sector or matter, with respect to which the
measure is maintained;
(b) the domestic or international industry
classification codes, where applicable, to which
the measure relates;
(c) the level of the government which maintains the
measure;
(d) the obligations under this Agreement with which
the measure does not conform;
(e) the legal source of the measure; and
(f) the succinct description of the measure.
3. Articles 59, 60 and 63 shall not apply to any measure
that a Party adopts or maintains with respect to the
sectors or matters specified in Annex 5.
4. Where a Party maintains any non-conforming measure on
the date of entry into force of this Agreement with respect
to the sectors or matters specified in Annex 5, the Party
shall, on the same date, notify the other Party of the
following information on the measure:
(a) the sector or matter, with respect to which the
measure is maintained;
(b) the domestic or international industry
classification codes, where applicable, to which
the measure relates;
(c) the obligations under this Agreement with which
the measure does not conform;
(d) the legal source of the measure; and
(e) the succinct description of the measure.
5. Neither Party shall, under any measure adopted after
the date of entry into force of this Agreement with respect
to the sectors or matters specified in Annex 5, require an
investor of the other Party, by reason of its nationality,
to sell or otherwise dispose of an investment that exists
at the time the measure becomes effective, unless otherwise
specified in the initial approval by the relevant
authority.
6. In cases where a Party makes an amendment or a
modification to any non-conforming measure notified
pursuant to paragraph 2 or 4, or where a Party adopts any
new measure with respect to the sectors or matters
specified in Annex 5, after the date of entry into force of
this Agreement, the Party shall, as soon as possible:
(a) notify the other Party of detailed information on
such amendment, modification or new measure; and
(b) respond, upon the request by the other Party, to
specific questions from the other Party with
respect to such amendment, modification or new
measure.
7. Each Party shall endeavor, where appropriate, to
reduce or eliminate the non-conforming measures that it
adopts or maintains with respect to the sectors or matters
specified in Annexes 4 and 5 respectively.
8. Articles 59 and 60 shall not apply to any measure
covered by the exceptions to, or derogations from,
obligations under Articles 3 and 4 of the TRIPS Agreement,
as specifically provided in Articles 3 through 5 of the
TRIPS Agreement.
9. Articles 59, 60 and 63 shall not apply to any measure
that a Party adopts or maintains with respect to government
procurement.
Article 65
Expropriation and Compensation
1. Neither Party shall expropriate or nationalize
investments in its Area of investors of the other Party or
take any measure tantamount to expropriation or
nationalization (hereinafter referred to in this Chapter as
“expropriation”) except:
(a) for a public purpose;
(b) on a non-discriminatory basis;
(c) in accordance with due process of law and Article
61; and
(d) upon payment of prompt, adequate and effective
compensation pursuant to paragraphs 2 through 4.
2. The compensation shall be equivalent to the fair
market value of the expropriated investments at the time
when the expropriation was publicly announced or when the
expropriation occurred, whichever is the earlier. The fair
market value shall not reflect any change in market value
occurring because the expropriation had become publicly
known earlier.
3. The compensation shall be paid without delay and shall
include interest at a commercially reasonable rate taking
into account the length of time from the time of
expropriation to the time of payment. It shall be
effectively realizable and freely transferable and shall be
freely convertible, at the market exchange rate prevailing
on the date of expropriation, into the currency of the
Party of the investors concerned and freely convertible
currencies.
4. Without prejudice to Article 69, the investors
affected by expropriation shall have a right of access to
the courts of justice or the administrative tribunals or
agencies of the Party making the expropriation to seek a
prompt review of the investors’ case and the amount of
compensation in accordance with the principles set out in
this Article.
Article 66
Protection from Strife
1. Each Party shall accord to investors of the other
Party that have suffered loss or damage relating to their
investments in the Area of the former Party due to armed
conflict or state of emergency such as revolution,
insurrection, civil disturbance or any other similar event
in the Area of that former Party, treatment, as regards
restitution, indemnification, compensation or any other
settlement, that is no less favourable than that it accords
to its own investors or to investors of a non-Party.
2. Any payments as a means of settlement referred to in
paragraph 1 shall be effectively realizable, freely
transferable and freely convertible at the market exchange
rate into the currency of the Party of the investors
concerned and freely convertible currencies.
Article 67
Transfers
1. Each Party shall ensure that all transfers relating to
investments in its Area of an investor of the other Party
may be made freely into and out of its Area without delay.
Such transfers shall include those of:
(a) the initial capital and additional amounts to
maintain or increase investments;
(b) profits, capital gains, dividends, royalties,
interests, fees and other current incomes
accruing from investments;
(c) proceeds from the total or partial sale or
liquidation of investments;
(d) payments made under a contract including loan
payments in connection with investments;
(e) earnings and remuneration of personnel from the
other Party who work in connection with
investments in the Area of the former Party;
(f) payments made in accordance with Articles 65 and
66; and
(g) payments arising out of the settlement of a
dispute under Article 69.
2. Each Party shall further ensure that such transfers
may be made in freely convertible currencies at the market
exchange rate prevailing on the date of each transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may delay
or prevent such transfers through the equitable, nondiscriminatory
and good-faith application of its laws
relating to:
(a) bankruptcy, insolvency or the protection of the
rights of creditors;
(b) issuing, trading or dealing in securities;
(c) criminal or penal offenses; or
(d) ensuring compliance with orders or judgments in
adjudicatory proceedings.
Article 68
Subrogation
1. If a Party or its designated agency makes a payment to
any of its investors under an indemnity, guarantee or
contract of insurance given in respect of an investment of
that investor within the Area of the other Party, the other
Party shall:
(a) recognize the assignment, to the former Party or
its designated agency, of any right or claim of
the investor that formed the basis of such
payment; and
(b) recognize the right of the former Party or its
designated agency to exercise by virtue of
subrogation such right or claim to the same
extent as the original right or claim of the
investor.
2. Articles 65 through 67 shall apply mutatis mutandis as
regards payment to be made to the Party or its designated
agency mentioned in paragraph 1 by virtue of such
assignment of right or claim, and the transfer of such
payment.
Article 69
Settlement of Investment Disputes
between a Party and an Investor of the Other Party
1. For the purposes of this Chapter, an “investment
dispute” is a dispute between a Party and an investor of
the other Party that has incurred loss or damage by reason
of, or arising out of, an alleged breach of any obligation
under this Agreement with respect to the investor and its
investments.
2. An investment dispute shall, as far as possible, be
settled amicably through consultation or negotiation
between an investor who is a party to the investment
dispute (hereinafter referred to in this Article as
“disputing investor”) and the Party that is a party to the
investment dispute (hereinafter referred to in this Article
as “disputing Party”).
3. Nothing in this Article shall be construed so as to
prevent a disputing investor from seeking administrative or
judicial settlement within the disputing Party in
accordance with the laws and regulations of the disputing
Party.
4. If the investment dispute cannot be settled through
consultation or negotiation referred to in paragraph 2
within five months from the date on which the disputing
investor requested for the consultation or negotiation in
writing and if the disputing investor has not submitted the
investment dispute for resolution under courts of justice
or administrative tribunals or agencies, the disputing
investor may submit the investment dispute to one of the
following international conciliations or arbitrations:
(a) conciliation or arbitration in accordance with
the Convention on the Settlement of Investment
Dispute between States and Nationals of Other
States(hereinafter referred to in this Article as
“the ICSID Convention”), so long as the ICSID
Convention is in force between the Parties;
(b) conciliation or arbitration under the Additional
Facility Rules of the International Centre for
Settlement of Investment Disputes, so long as the
ICSID Convention is not in force between the
Parties;
(c) arbitration under the Arbitration Rules of the
United Nations Commission on International Trade
Law, adopted by the United Nations Commission on
International Trade Law on April 28, 1976; and
(d) if agreed with the disputing Party, any
arbitration in accordance with other arbitration
rules.
5. The applicable conciliation or arbitration rules shall
govern the conciliation or arbitration set forth in
paragraph 4 except to the extent modified in this Article.
6. A disputing investor who intends to submit the
investment dispute to conciliation or arbitration pursuant
to paragraph 4 shall give to the disputing Party written
notice of intent to do so at least 90 days before the
investment dispute is submitted. The notice of intent
shall specify:
(a) the name and address of the disputing investor;
(b) the specific measures of the disputing Party at
issue and a brief summary of the factual and
legal basis of the investment dispute sufficient
to present the problem clearly, including the
provisions under this Agreement alleged to have
been breached; and
(c) conciliation or arbitration set forth in
paragraph 4 which the disputing investor will
choose.
7. (a) Each Party hereby consents to the submission of
investment disputes by a disputing investor to
conciliation or arbitration set forth in
paragraph 4.
(b) The consent given by subparagraph (a) and the
submission by a disputing investor of an
investment dispute to conciliation or arbitration
shall satisfy the requirements of:
(i) Chapter II of the ICSID Convention or the
Additional Facility Rules of the
International Centre for Settlement of
Investment Disputes, for written consent of
the parties to a dispute; and
(ii) Article II of the New York Convention for an
agreement in writing.
8. Notwithstanding paragraph 7, no investment dispute may
be submitted to conciliation or arbitration set forth in
paragraph 4, if more than three years have elapsed since
the date on which the disputing investor acquired or should
have first acquired, whichever is the earlier, the
knowledge that the disputing investor had incurred loss or
damage referred to in paragraph 1.
9. Notwithstanding paragraph 4, the disputing investor
may initiate or continue an action that seeks interim
injunctive relief that does not involve the payment of
damages before an administrative tribunal or agency or a
court of justice under the law of the disputing Party.
10. Unless the disputing investor and the disputing Party
(hereinafter referred to in this Article as “the disputing
parties”) agree otherwise, an arbitral tribunal established
under paragraph 4 shall comprise three arbitrators, one
arbitrator appointed by each of the disputing parties and
the third, who shall be the presiding arbitrator, appointed
by agreement of the disputing parties. If the disputing
investor or the disputing Party fails to appoint an
arbitrator or arbitrators within 60 days from the date on
which the investment dispute was submitted to arbitration,
the Secretary-General of the International Centre for
Settlement of Investment Disputes (hereinafter referred to
in this Article as “ICSID”), may be requested by either of
the disputing parties, to appoint the arbitrator or
arbitrators not yet appointed from the ICSID Panel of
Arbitrators subject to the requirements of paragraphs 11
and 12.
11. Unless the disputing parties agree otherwise, the
third arbitrator shall not be a national of either Party,
nor have his or her usual place of residence in either
Party, nor be employed by either of the disputing parties,
nor have dealt with the investment dispute in any capacity.
12. In the case of arbitration referred to in paragraph 4,
each of the disputing parties may indicate up to three
nationalities, the appointment of arbitrators of which is
unacceptable to it. In this event, the Secretary-General
of the ICSID may be requested not to appoint as arbitrator
any person whose nationality is indicated by either of the
disputing parties.
13. Unless the disputing parties agree otherwise, the
arbitration shall be held in a country that is a party to
the New York Convention.
14. An arbitral tribunal established under paragraph 4
shall decide the issues in dispute in accordance with this
Agreement and applicable rules of international law.
15. The disputing Party shall deliver to the other Party:
(a) written notice of the investment dispute
submitted to the arbitration no later than 30
days after the date on which the investment
dispute was submitted; and
(b) copies of all pleadings filed in the arbitration.
16. On written notice to the disputing parties, the Party
which is not the disputing Party may make submissions to
the arbitral tribunal on a question of interpretation of
this Agreement.
17. The arbitral tribunal may order an interim measure of
protection to preserve the rights of the disputing
investor, or to facilitate the conduct of arbitral
proceedings, including an order to preserve evidence in the
possession or control of either of the disputing parties.
The arbitral tribunal shall not order attachment or enjoin
the application of the measure alleged to constitute a
breach referred to in paragraph 1.
18. The award rendered by the arbitral tribunal shall
include:
(a) a judgment whether or not there has been a breach
by the disputing Party of any obligation under
this Agreement with respect to the disputing
investor and its investments; and
(b) a remedy if there has been such breach. The
remedy shall be limited to one or both of the
following:
(i) payment of monetary damages and applicable
interest; and
(ii) restitution of property, in which case the
award shall provide that the disputing Party
may pay monetary damages and any applicable
interest in lieu of restitution.
Costs may also be awarded in accordance with the
applicable arbitration rules.
19. The award rendered in accordance with paragraph 18
shall be final and binding upon the disputing parties. The
disputing Party shall carry out without delay the
provisions of the award and provide in its Area for the
enforcement of the award in accordance with its relevant
laws and regulations.
20. Neither Party shall give diplomatic protection, or
bring an international claim, in respect of an investment
dispute which the other Party and an investor of the former
Party have consented to submit or submitted to arbitration
set forth in paragraph 4, unless the other Party shall have
failed to abide by and comply with the award rendered in
such investment dispute. Diplomatic protection, for the
purposes of this paragraph, shall not include informal
diplomatic exchanges for the sole purpose of facilitating a
settlement of the investment dispute.
21. Annex 6 provides additional provisions with respect to
the settlement of investment disputes.
Article 70
Temporary Safeguard Measures
1. A Party may adopt or maintain measures not conforming
with its obligations under Article 59 relating to crossborder
capital transactions and Article 67:
(a) in the event of serious balance-of-payments and
external financial difficulties or threat
thereof; or
(b) in cases where, in exceptional circumstances,
movements of capital cause or threaten to cause
serious difficulties for macroeconomic management
in particular, monetary and exchange rate
policies.
2. Measures referred to in paragraph 1:
(a) shall be consistent with the Articles of
Agreement of the International Monetary Fund;
(b) shall not exceed those necessary to deal with the
circumstances set out in paragraph 1;
(c) shall be temporary and eliminated as soon as
conditions permit; and
(d) shall be promptly notified to the other Party.
3. Nothing in this Article shall be regarded as altering
the rights enjoyed and obligations undertaken by a Party as
a party to the Articles of Agreement of the International
Monetary Fund.
Article 71
Prudential Measures
1. Notwithstanding any other provisions of this Chapter,
a Party shall not be prevented from taking measures
relating to financial services for prudential reasons,
including measures for the protection of investors,
depositors, policy holders or persons to whom a fiduciary
duty is owed by an enterprise supplying financial services,
or to ensure the integrity and stability of the financial
system.
2. Where such measures do not conform with the provisions
of this Chapter, they shall not be used as a means of
avoiding the Party's commitments or obligations under this
Chapter.
Article 72
Denial of Benefits
1. A Party may deny the benefits of this Chapter to an
investor of the other Party that is an enterprise of the
other Party and to its investments, where the denying Party
establishes that the enterprise is owned or controlled by
an investor of a non-Party and the denying Party:
(a) does not maintain diplomatic relations with the
non-Party; or
(b) adopts or maintains measures with respect to the
non-Party that prohibit transactions with the
enterprise or that would be violated or
circumvented if the benefits of this Chapter were
accorded to the enterprise or to its investments.
2. Subject to prior notification and consultation, a
Party may deny the benefits of this Chapter to an investor
of the other Party that is an enterprise of the other Party
and to its investments, where the denying Party establishes
that the enterprise is owned or controlled by an investor
of a non-Party and the enterprise has no substantial
business activities in the Area of the other Party.
Article 73
Taxation Measures as Expropriation
1. Article 65 shall apply to taxation measures, to the
extent that such taxation measures constitute expropriation
as provided for in paragraph 1 of Article 65.
2. Where Article 65 applies to taxation measures in
accordance with paragraph 1, Articles 62 and 69 shall also
apply in respect of taxation measures.
3. Notwithstanding paragraph 2, no investor may invoke
Article 65 as the basis for an investment dispute under
Article 69, where it has been determined pursuant to
paragraph 4 that the taxation measure is not an
expropriation.
4. The investor shall refer the issue, at the time that
it gives a written notice of intent under paragraph 6 of
Article 69, to the competent authorities of both Parties,
through the contact points referred to in Article 16, to
determine whether such measure is not an expropriation. If
the competent authorities of both Parties do not consider
the issue or, having considered it, fail to determine that
the measure is not an expropriation within a period of five
months of such referral, the investor may submit the
investment dispute to conciliation or arbitration under
Article 69.
5. Paragraphs 2 through 4 shall apply only to taxation
measure taken in the form of or in the applications of the
laws and regulations which are enacted or amended after the
entry into force of this Agreement.
Note: With respect to Indonesia, taxation measures
referred to in this paragraph do not include those
taken by tax administrative authorities in the
applications of the relevant laws and regulations.
6. For the purposes of paragraph 4, the term “competent
authorities” means:
(a) with respect to Japan, the Minister of Finance or
his or her authorized representative, who shall
consider the issue in consultation with the
Minister of Foreign Affairs or his or her
authorized representative; and
(b) with respect to Indonesia, the Minister of
Finance or his or her authorized representative.
Article 74
Environmental Measures
Each Party recognizes that it is inappropriate to
encourage investments by investors of the other Party by
relaxing its environmental measures. To this effect each
Party should not waive or otherwise derogate from such
environmental measures as an encouragement for
establishment, acquisition or expansion of investments in
its Area.
Article 75
Sub-Committee on Investment
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Investment (hereinafter referred to in this
Article as “the Sub-Committee”) established in accordance
with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) reviewing the specific reservations and
exceptions under Article 64;
(c) discussing any issues related to this Chapter;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 6
Trade in Services
Article 76
Scope
1. This Chapter shall apply to measures by a Party
affecting trade in services.
2. This Chapter shall not apply to:
(a) in respect of air transport services, measures
affecting traffic rights, however granted; or to
measures affecting services directly related to
the exercise of traffic rights, other than
measures affecting:
(i) aircraft repair and maintenance services;
(ii) the selling and marketing of air transport
services; and
(iii) computer reservation system services;
(b) cabotage in maritime transport services;
(c) subsidies provided by a Party or a state
enterprise thereof, including grants, government supported
loans, guarantees and insurance;
(d) measures affecting the movement of natural
persons of a Party, unless otherwise provided in
a Schedule of Specific Commitments in Annex 8;
(e) measures affecting natural persons of a Party
seeking access to employment market of the other
Party, or measures regarding nationality, or
residence or employment on a permanent basis; and
(f) government procurement.
3. Annex 7 provides supplementary provisions to this
Chapter on financial services, including scope and
definitions.
Article 77
Definitions
For the purposes of this Chapter:
(a) the term “aircraft repair and maintenance
services” means such activities when undertaken
on an aircraft or a part thereof while it is
withdrawn from service and does not include so called
line maintenance;
(b) the term “commercial presence” means any type of
business or professional establishment, including
through:
(i) the constitution, acquisition or maintenance
of a juridical person; or
(ii) the creation or maintenance of a branch or a
representative office,
within the Area of a Party for the purposes of
supplying services;
(c) the term “computer reservation system services”
means services provided by computerized systems
that contain information about air carriers’
schedules, availability, fares and fare rules,
through which reservations may be made or tickets
may be issued;
(d) the term “juridical person” means any legal
entity duly constituted or otherwise organized
under applicable law, whether for profit or
otherwise, and whether privately-owned or
governmentally-owned, including any corporation,
trust, partnership, joint venture, sole
proprietorship or association;
(e) the term “juridical person of the other Party”
means a juridical person which is either:
(i) constituted or otherwise organized under the
law of the other Party; or
(ii) in the case of the supply of a service
through commercial presence, owned or
controlled by:
(A) natural persons of the other Party; or
(B) juridical persons of the other Party
identified under subparagraph (i);
(f) a juridical person is:
(i) “owned” by persons of a Party or a non-Party
if more than 50 percent of the equity
interests in it is beneficially owned by
such persons;
(ii) “controlled” by persons of a Party or a non-
Party if such persons have the power to name
a majority of its directors or otherwise to
legally direct its actions; and
(iii) “affiliated” with another person when it
controls, or is controlled by, that other
person; or when it and the other person are
both controlled by the same person;
(g) the term “measure” means any measure, whether in
the form of a law, regulation, rule, procedure,
decision, administrative action or any other
form;
Note: The term “measure” shall include taxation
measures to the extent covered by the
GATS.
(h) the term “measure by a Party” means any measure
taken by:
(i) central or local governments and authorities
of a Party; and
(ii) non-governmental bodies in the exercise of
powers delegated by central or local
governments or authorities of a Party;
(i) the term “measures by a Party affecting trade in
services” includes measures by a Party in respect
of:
(i) the purchase, payment or use of services;
(ii) the access to and use of, in connection with
the supply of services, services which are
required by the Party to be offered to the
public generally; and
(iii) the presence, including commercial presence,
of persons of the other Party for the supply
of services in the Area of the former Party;
(j) the term “monopoly supplier of a service” means
any person, public or private, which in the
relevant market of a Party is authorized or
established formally or in effect by that Party
as the sole supplier of that service;
(k) the term “natural person of a Party” means a
natural person who resides in a Party or
elsewhere and who is a national of the Party
under the law of the Party;
(l) the term “person” means either a natural person
or a juridical person;
(m) the term “service” includes any service in any
sector except a service supplied in the exercise
of governmental authority;
(n) the term “service consumer” means any person that
receives or uses services;
(o) the term “services of the other Party” means
services which are supplied:
(i) from or in the Area of the other Party, or
in the case of maritime transport services,
by a vessel registered under the law of the
other Party, or by a person of the other
Party which supplies such services through
the operation of a vessel or its use in
whole or in part; or
(ii) in the case of the supply of services
through commercial presence or through the
presence of natural persons, by service
suppliers of the other Party;
(p) the term “service supplied in the exercise of
governmental authority” means any service which
is supplied neither on a commercial basis nor in
competition with one or more service suppliers;
(q) the term “service supplier” means any person that
seeks to supply or supplies a service;
Note: Where the service is not supplied directly
by a juridical person but through other
forms of commercial presence such as a
branch or a representative office, the
service supplier (i.e. the juridical
person) shall, nonetheless, through such
presence be accorded the treatment
provided for service suppliers under this
Chapter. Such treatment shall be extended
to the presence through which the service
is supplied and need not be extended to
any other parts of the supplier located
outside the Area of a Party where the
service is supplied.
(r) the term “state enterprise” means an enterprise
owned or controlled by the Government of a Party;
(s) the term “supply of a service” includes the
production, distribution, marketing, sale and
delivery of a service;
(t) the term “the selling and marketing of air
transport services” means opportunities for the
air carrier concerned to sell and market freely
its air transport services including all aspects
of marketing such as market research, advertising
and distribution. These activities do not
include the pricing of air transport services nor
the applicable conditions;
(u) the term “trade in services” means the supply of
services:
(i) from the Area of a Party into the Area of
the other Party (“cross-border supply
mode”);
(ii) in the Area of a Party to the service
consumer of the other Party (“consumption
abroad mode”);
(iii) by a service supplier of a Party, through
commercial presence in the Area of the other
Party (“commercial presence mode”); and
(iv) by a service supplier of a Party, through
presence of natural persons of that Party in
the Area of the other Party (“presence of
natural persons mode”); and
(v) the term “traffic rights” means the rights for
scheduled and non-scheduled services to operate
and/or to carry passengers, cargo and mail for
remuneration or hire from, to, within, or over a
Party, including points to be served, routes to
be operated, types of traffic to be carried,
capacity to be provided, tariffs to be charged
and their conditions, and criteria for
designation of airlines, including such criteria
as number, ownership and control.
Article 78
Market Access
1. With respect to market access through the modes of
supply defined in subparagraph (u) of Article 77, each
Party shall accord services and service suppliers of the
other Party treatment no less favourable than that provided
for under the terms, limitations and conditions agreed
and specified in its Schedule of Specific Commitments in
Annex 8.
Note: If a Party undertakes a market-access commitment in
relation to the supply of a service through the mode
of supply referred to in subparagraph (u)(i) of
Article 77 and if the cross-border movement of
capital is an essential part of the service itself,
that Party is thereby committed to allow such
movement of capital. If a Party undertakes a
market-access commitment in relation to the supply
of a service through the mode of supply referred to
in subparagraph (u)(iii) of Article 77, it is
thereby committed to allow related transfers of
capital into its Area.
2. In sectors where market-access commitments are
undertaken, the measures which a Party shall not maintain
or adopt either on the basis of a regional subdivision or
on the basis of its entire Area, unless otherwise specified
in its Schedule of Specific Commitments in Annex 8, are
defined as:
(a) limitations on the number of service suppliers
whether in the form of numerical quotas,
monopolies, exclusive service suppliers or the
requirements of an economic needs test;
(b) limitations on the total value of service
transactions or assets in the form of numerical
quotas or the requirement of an economic needs
test;
(c) limitations on the total number of service
operations or on the total quantity of service
output expressed in terms of designated numerical
units in the form of quotas or the requirement of
an economic needs test;
Note: This subparagraph does not cover measures
of a Party which limit inputs for the
supply of services.
(d) limitations on the total number of natural
persons that may be employed in a particular
service sector or that a service supplier may
employ and who are necessary for, and directly
related to, the supply of a specific service in
the form of numerical quotas or the requirement
of an economic needs test;
(e) measures which restrict or require specific types
of legal entity or joint venture through which a
service supplier may supply a service; and
(f) limitations on the participation of foreign
capital in terms of maximum percentage limit on
foreign shareholding or the total value of
individual or aggregate foreign investment.
Article 79
National Treatment
1. In the sectors inscribed in its Schedule of Specific
Commitments in Annex 8, and subject to any conditions and
qualifications set out therein, each Party shall accord to
services and service suppliers of the other Party, in
respect of all measures affecting the supply of services,
treatment no less favourable than that it accords to its
own like services and service suppliers.
Note: Specific commitments assumed under this Article
shall not be construed to require either Party to
compensate for any inherent competitive
disadvantages which result from the foreign
character of the relevant services or service
suppliers.
2. A Party may meet the requirement of paragraph 1 by
according to services and service suppliers of the other
Party, either formally identical treatment or formally
different treatment to that it accords to its own like
services and service suppliers.
3. Formally identical or formally different treatment
shall be considered to be less favourable if it modifies
the conditions of competition in favour of services or
service suppliers of the Party which accords such treatment
compared to like services or service suppliers of the other
Party.
4. A Party shall not invoke the preceding paragraphs
under Chapter 14 with respect to a measure of the other
Party that falls within the scope of an international
agreement between the Parties relating to the avoidance of
double taxation.
Article 80
Additional Commitments
The Parties may negotiate commitments with respect to
measures affecting trade in services not subject to
scheduling under Articles 78 and 79, including those
regarding qualifications, standards or licensing matters.
Such commitments shall be inscribed in a Party’s Schedule
of Specific Commitments in Annex 8.
Article 81
Schedule of Specific Commitments
1. With respect to sectors or sub-sectors where specific
commitments are undertaken by each Party, its Schedule of
Specific Commitments in Annex 8 shall specify:
(a) terms, limitations and conditions on market
access;
(b) conditions and qualifications on national
treatment;
(c) undertakings relating to additional commitments;
and
(d) where appropriate, the time-frame for
implementation of such commitments.
2. Measures inconsistent with both Articles 78 and 79
shall be inscribed in the column relating to Article 78.
In this case the inscription will be considered to provide
a condition or qualification to Article 79 as well.
3. With respect to sectors or sub-sectors where specific
commitments are undertaken in Annex 8 and which are
indicated with “SS”, any terms, limitations, conditions and
qualifications, referred to in subparagraphs 1(a) and (b),
shall be limited to those based on non-conforming measures,
which are in effect on the date of entry into force of this
Agreement.
4. With respect to sectors or sub-sectors where specific
commitments are undertaken by a Party in Annex 8 and which
are indicated with “S”, any terms, limitations, conditions
and qualifications on market access or national treatment,
applied to a service supplier of the other Party on the
date of entry into force of this Agreement, shall not be
changed or modified so as to become more restrictive to
such a service supplier.
Note: With regard to the rights given to the service
supplier under the above mentioned terms,
limitations, conditions and qualifications, this
paragraph shall apply to the same extent as the
rights that the service supplier has already
exercised.
Article 82
Most-Favoured-Nation Treatment
1. Each Party shall accord to services and service
suppliers of the other Party treatment no less favourable
than that it accords to like services and service suppliers
of any non-Party.
2. Paragraph 1 shall not apply to any measure by a Party
with respect to sectors, sub-sectors or activities, as set
out in its Schedule in Annex 9.
Article 83
Authorization, Licensing or Qualification
With a view to ensuring that any measure by a Party
relating to the authorization, licensing or qualification
of service suppliers of the other Party does not constitute
an unnecessary barrier to trade in services, each Party
shall endeavor to ensure that such measure:
(a) is based on objective and transparent criteria,
such as the competence and ability to supply
services;
(b) is not more burdensome than necessary to ensure
the quality of services; and
(c) does not constitute a disguised restriction on
the supply of services.
Article 84
Mutual Recognition
1. A Party may recognize the education or experience
obtained, requirements met, or licenses or certifications
granted in the other Party for the purposes of the
fulfillment, in whole or in part, of its standards or
criteria for the authorization, licensing or certification
of service suppliers of the other Party.
2. Recognition referred to in paragraph 1, which may be
achieved through harmonization or otherwise, may be based
upon an agreement or arrangement between the Parties or may
be accorded unilaterally.
3. Where a Party recognizes, by agreement or arrangement
between the Party and a non-Party or unilaterally, the
education or experience obtained, requirements met or
licenses or certifications granted in the non-Party:
(a) nothing in Article 82 shall be construed to
require the Party to accord such recognition to
the education or experience obtained,
requirements met or licenses or certifications
granted in the other Party; and
(b) the Party shall accord the other Party an
adequate opportunity to demonstrate that the
education or experience obtained, requirements
met or licenses or certifications granted in the
other Party should also be recognized.
Article 85
Transparency
The competent authorities referred to in paragraph 2
of Article 3 shall, upon request by service suppliers of
the other Party, promptly respond to specific questions
from, and provide information to, the service suppliers
with respect to matters referred to in paragraph 1 of
Article 3 through the contact points referred to in Article 16.
Note: The information provided by the Parties under this
Article will be supplied solely for the purposes of
transparency and shall not be construed to affect
any rights and obligations of the Parties under this
Chapter.
Article 86
Monopolies and Exclusive Service Suppliers
1. Each Party shall ensure that any monopoly supplier of
a service in its Area does not, in the supply of the
monopoly service in the relevant market, act in a manner
inconsistent with the Party’s commitments under this
Chapter.
2. Where a Party’s monopoly supplier competes, either
directly or through an affiliated juridical person, in the
supply of a service outside the scope of its monopoly
rights and which is subject to that Party’s specific
commitments, the Party shall ensure that such a supplier
does not abuse its monopoly position to act in the Area of
the Party in a manner inconsistent with such commitments.
3. The provisions of this Article shall also apply to
cases of exclusive service suppliers, where a Party,
formally or in effect:
(a) authorizes or establishes a small number of
service suppliers; and
(b) substantially prevents competition among those
suppliers in its Area.
Article 87
Payments and Transfers
1. Except under the circumstances envisaged in Article
88, a Party shall not apply restrictions on international
transfers and payments for current transactions relating to
trade in services.
2. Nothing in this Chapter shall affect the rights and
obligations of the Parties as members of the International
Monetary Fund under the Articles of Agreement of the
International Monetary Fund, including the use of exchange
actions which are in conformity with the Articles of
Agreement of the International Monetary Fund, provided that
a Party shall not impose restrictions on any capital
transactions inconsistently with its commitments under this
Chapter regarding such transactions, except under Article
88, or at the request of the International Monetary Fund.
Article 88
Restrictions to Safeguard the Balance of Payments
1. In the event of serious balance-of-payments and
external financial difficulties or threat thereof, a Party
may adopt or maintain restrictions on trade in services,
including on payments or transfers for transactions.
2. The restrictions referred to in paragraph 1:
(a) shall ensure that the other Party is treated as
favourably as any non-Party;
(b) shall be consistent with the Articles of
Agreement of the International Monetary Fund;
(c) shall avoid unnecessary damage to the commercial,
economic and financial interests of the other
Party;
(d) shall not exceed those necessary to deal with the
circumstances described in paragraph 1; and
(e) shall be temporary and be phased out
progressively as the situation specified in
paragraph 1 improves.
3. In determining the incidence of such restrictions, a
Party may give priority to the supply of services which are
more essential to its economic or development programs.
However, such restrictions shall not be adopted or
maintained for the purposes of protecting a particular
service sector.
Article 89
Emergency Safeguard Measures
1. The Parties shall take note of the multilateral
negotiations on the question of emergency safeguard
measures based on the principle of non-discrimination
pursuant to Article X of the GATS. Upon the conclusion of
such multilateral negotiations, the Parties shall conduct a
review for the purpose of discussing appropriate amendments
to this Agreement based on the results of such multilateral
negotiations.
2. In the event that the implementation of this Agreement
causes substantial adverse impact to a Party in a specific
service sector prior to the conclusion of the multilateral
negotiations referred to in paragraph 1, the Party may
request consultations with the other Party for the purposes
of taking appropriate measures to address such adverse
impact. The Parties shall take into account the
circumstances of the particular case in such consultations.
Article 90
Denial of Benefits
1. A Party may deny the benefits of this Chapter to a
service supplier of the other Party that is a juridical
person of the other Party, where the denying Party
establishes that the juridical person is owned or
controlled by persons of a non-Party, and the denying
Party:
(a) does not maintain diplomatic relations with the
non-Party; or
(b) adopts or maintains measures with respect to the
non-Party that prohibit transactions with the
juridical person or that would be violated or
circumvented if the benefits of this Chapter were
accorded to the juridical person.
2. Subject to prior notification and consultation, a
Party may deny the benefits of this Chapter to a service
supplier of the other Party that is a juridical person of
the other Party, where the denying Party establishes that
the juridical person is owned or controlled by persons of a
non-Party and has no substantial business activities in the
Area of the other Party.
Article 91
Sub-Committee on Trade in Services
For the purposes of effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Trade in Services (hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) reporting the findings of the Sub-Committee to
the Joint Committee; and
(d) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 7
Movement of Natural Persons
Article 92
Scope
1. This Chapter shall apply to measures affecting the
movement of natural persons of a Party who enter the other
Party and fall under one of the categories referred to in
Annex 10.
2. This Chapter shall not apply to measures affecting
natural persons of a Party seeking access to employment
market of the other Party, nor shall it apply to measures
regarding nationality, or residence or employment on a
permanent basis.
3. This Chapter shall not prevent a Party from applying
measures to regulate the entry of natural persons of the
other Party into, or their temporary stay in, the former
Party, including those measures necessary to protect the
integrity of, and to ensure the orderly movement of natural
persons across, its borders, provided that such measures
are not applied in such a manner as to nullify or impair
the benefits accruing to the other Party under the terms of
specific commitments set out in Annex 10.
Note: The sole fact of requiring a visa or its
equivalent for natural persons of a certain
nationality or citizenship and not for those of
others shall not be regarded as nullifying or
impairing benefits under specific commitments
set out in Annex 10.
Article 93
Definition
For the purposes of this Chapter, the term “natural
persons of a Party” means natural persons who reside in a
Party or elsewhere and who under the law of the Party are
nationals of the Party.
Article 94
Specific Commitments
1. Each Party shall grant entry and temporary stay to
natural persons of the other Party in accordance with this
Chapter including the terms of the categories in Annex 10,
provided that the natural persons comply with the laws and
regulations related to movement of natural persons of the
former Party applicable to entry and temporary stay which
are not inconsistent with the provisions of this Chapter.
2. Each Party shall, in accordance with its laws and
regulations, issue proper travel documents necessary for
immediate return to the Party, to the natural persons of
the Party who stay in the other Party based on the grant of
entry and temporary stay under paragraph 1, where such
persons are required to leave the other Party in accordance
with the laws and regulations of the other Party which are
not inconsistent with the provisions of this Chapter.
3. Each Party may require a natural person of the other
Party to obtain an appropriate visa or its equivalent prior
to entry and temporary stay under paragraph 1.
4. Neither Party shall impose or maintain any limitations
on the number of granting entry and temporary stay under
paragraph 1, unless otherwise specified in Annex 10.
Article 95
Requirements and Procedures
1. Each Party shall establish and make publicly available
requirements and procedures for application for a renewal
of the period of temporary stay, a change of status of
temporary stay or an issuance of a work permit for a
natural person of the other Party who has been granted
entry and temporary stay under paragraph 1 of Article 94.
2. Each Party shall endeavor to provide, upon request by
a natural person of the other Party, information on
requirements and procedures referred to in paragraph 1.
3. Each Party shall, in accordance with its laws and
regulations, ensure that fees charged by its competent
authorities on application referred to in paragraph 1 do
not in themselves represent an unjustifiable impediment to
the movement of natural persons of the other Party under
this Chapter.
Article 96
Sub-Committee on Movement of Natural Persons
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Movement of Natural Persons (hereinafter
referred to in this Article as “the Sub-Committee”)
established in accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to this Chapter;
(c) adopting guidelines referred to in Annex 10;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article 14.
Chapter 8
Energy and Mineral Resources
Article 97
Definitions
For the purposes of this Chapter:
(a) the term “energy and mineral resource good” means
any good listed in Annex 11;
(b) the term “energy and mineral resource regulatory
bodies” means the governmental bodies that
regulate and control the exploration,
exploitation, production, operation,
transportation, transmission or distribution,
purchase or sale of an energy and mineral
resource good;
(c) the term “energy and mineral resource regulatory
measure” means any measure by energy and mineral
resource regulatory bodies that directly affects
the exploration, exploitation, production,
operation, transportation, transmission or
distribution, purchase or sale of an energy and
mineral resource good;
(d) the term “energy and mineral resource sector”
means the sector relating to the exploration,
exploitation, production, operation,
transportation, transmission or distribution,
purchase or sale of energy and mineral resource
goods;
(e) the term “export licensing procedures” means
administrative procedures, whether or not
referred to as “licensing”, used by a Party for
the operation of export licensing regimes
requiring the submission of an application or
other documentation, other than that required for
customs procedures, to the relevant
administrative body as a prior condition for
exportation from that Party; and
(f) the term “person of the other Party” means either
a natural person or an enterprise of the other
Party.
Article 98
Promotion and Facilitation of Investment
1. (a) Both Parties shall cooperate in promoting and
facilitating investments between the Parties in
the energy and mineral resource sector through
ways such as:
(i) discussing effective ways on investment
promotion activities and capacity building;
(ii) facilitating the provision and exchange of
investment information including information
on the laws, regulations and policies of the
Parties;
(iii) encouraging and supporting investment
promotion activities of each Party or the
business sectors of the Parties, relating
to, in particular, the exploration,
exploitation and production of energy and
mineral resource goods and the
infrastructural facilities in the energy and
mineral resources sector; and
(iv) discussing effective ways of creating
stable, equitable, favourable and
transparent conditions for investors.
(b) The implementation and operation of this
paragraph shall be subject to the availability of
funds and the applicable laws and regulations of
each Party.
2. Annex 12 provides additional provisions with respect
to the promotion and facilitation of investment in the
energy and mineral resource sector.
Article 99
Import and Export Restrictions
1. The Parties reaffirm their obligation to comply with
the relevant provisions of the GATT 1994, with respect to
prohibitions or restrictions on the importation or
exportation of energy and mineral resource goods.
2. Each Party, when introducing a prohibition or
restriction otherwise justified under the relevant
provisions of the GATT 1994, with respect to the
exportation to or importation from the other Party of an
energy and mineral resource good, shall provide relevant
information concerning such prohibition or restriction as
early as possible to the other Party and reply, upon the
request of the other Party, to specific questions on such
prohibition or restriction from the other Party, with a
view to avoiding disruption of ordinary business activities
in the Parties.
Article 100
Export Licensing Procedures and Administrations
If a Party adopts or maintains export licensing
procedures with respect to an energy and mineral resource
good:
(a) the rules for export licensing procedures shall
be neutral in application and administered in a
fair and equitable manner;
(b) the rules and all information concerning
procedures for the submission of applications,
including the eligibility of persons of the other
Party to make such applications, the
administrative bodies to be approached, and the
lists of products subject to the licensing
requirement shall be published, as soon as
possible, in such a manner as to enable the other
Party and traders of the other Party to become
acquainted with them. Any exceptions,
derogations or changes in or from the rules
concerning export licensing procedures or the
list of products subject to export licensing
shall also be published in the same manner as
specified above;
(c) in the case of licensing requirements for
purposes other than the implementation of
quantitative restrictions, the Party shall
publish sufficient information for the other
Party and traders of the other Party to know the
basis for granting and/or allocating licenses;
(d) where the Party provides the possibility for
persons of the other Party to request exceptions
or derogations from a licensing requirement, the
former Party shall include this fact in the
information published under paragraph (b) as well
as information on how to make such a request and,
to the extent possible, an indication of the
circumstances under which such a request would be
considered;
(e) the Party shall provide, upon the request of the
other Party, all relevant information concerning
the administration of the restrictions in
accordance with its laws and regulations;
(f) when administering quotas by means of export
licensing, the Party shall inform the other Party
of the overall amount of quotas to be applied and
any change thereof;
(g) the Party shall hold consultations upon the
request of the other Party, on the rules for such
procedures with the other Party; and
(h) any person of the other Party which fulfils the
legal and administrative requirements of the
former Party shall be equally eligible to apply
and to be considered for a license. If the
license application is not approved, the
applicant of the other Party shall, on request,
be given the reason therefore and shall have a
right of appeal or review in accordance with the
domestic legislation or procedures of the former
Party.
Article 101
Energy and Mineral Resource Regulatory Measures
1. Each Party shall seek to ensure that, in the
application of any energy and mineral resource regulatory
measure, the energy and mineral resource regulatory bodies
of the Party shall avoid disruption of contractual
relationships which exist at the time of the application of
the energy and mineral resource regulatory measure to the
maximum extent practicable and implement the energy and
mineral resource regulatory measure in an orderly and
equitable manner.
2. If the energy and mineral resource regulatory bodies
of a Party adopt any new energy and mineral resource
regulatory measure, the Party shall, as soon as possible,
notify the other Party or publish the energy and mineral
resource regulatory measure, and respond, upon the request
of the other Party, to specific questions on the energy and
mineral resource regulatory measure from the other Party.
Article 102
Environmental Aspects
1. Each Party, in pursuit of sustainable development and
taking into account its obligations under those
international agreements concerning environment to which it
is a party, confirms the importance of avoiding or
minimizing, in an economically efficient manner, harmful
environmental impacts of all activities related to energy
and mineral resources in its Area.
2. Each Party shall:
(a) take account of environmental considerations, in
accordance with its laws and regulations,
throughout the process of formulation and
implementation of its policy on energy and
mineral resources;
(b) encourage favourable conditions for the transfer
and dissemination of technologies that contribute
to the protection of environment, consistent with
the adequate and effective protection of
intellectual property rights; and
(c) promote public awareness of environmental impacts
of activities related to energy and mineral
resources and of the scope for and the costs
associated with the prevention or abatement of
such impacts.
Article 103
Community Development
Each Party welcomes any contribution by investors of
the other Party to the development of its community when
such investors make investments in the energy and mineral
resource sector in its Area.
Article 104
Cooperation
1. Both Parties shall cooperate in the energy and mineral
resource sector of Indonesia.
2. (a) The Parties shall endeavor to make available the
necessary funds and other resources for the
implementation of cooperation under this Article
in accordance with their respective laws and
regulations.
(b) Costs of cooperation under this Article shall be
borne in an equitable manner to be mutually
agreed upon by the Parties.
3. (a) Areas of cooperation under this Article shall
include policy development, capacity building,
and technology transfer.
(b) Forms of cooperation under this Article shall be
set forth in the Implementing Agreement.
Article 105
Sub-Committee on Energy and Mineral Resources
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Energy and Mineral Resources (hereinafter
referred to in this Article as “the Sub-Committee”)
established in accordance with Article 15 shall be:
(a) exchanging information on any matters related to
this Chapter;
(b) reviewing and monitoring the implementation and
operation of this Chapter;
(c) discussing any issues related to this Chapter,
including issues related to business environment,
cooperation, energy security, and the development
of an open and competitive market;
(d) reporting the findings of the Sub-Committee and,
where appropriate, making recommendations, to the
Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Chapter 9
Intellectual Property
Article 106
General Provisions
1. The Parties, aiming at further promoting trade and
investment, shall grant and ensure adequate, effective and
non-discriminatory protection of intellectual property,
promote efficiency and transparency in the administration
of intellectual property protection system, and provide for
measures for the enforcement of intellectual property
rights against infringement, counterfeiting and piracy, in
accordance with the provisions of this Chapter and the
international agreements to which both Parties are parties.
2. The Parties reaffirm their commitment to comply with
the obligations set out in the international agreements
relating to intellectual property to which both Parties are
parties.
3. Each Party shall endeavor to become a party, if it is
not a party, to the following international agreements in
accordance with its necessary procedures:
(a) the Protocol Relating to the Madrid Agreement
Concerning the International Registration of
Marks of June 27, 1989, as amended;
(b) the International Convention for the Protection
of Performers, Producers of Phonograms and
Broadcasting Organizations of October 26, 1961;
and
(c) the 1991 Act of International Convention for the
Protection of New Varieties of Plants
(hereinafter referred to in this Chapter as “the
1991 UPOV Convention”).
Article 107
Definitions
For the purposes of this Chapter:
(a) the term “intellectual property” means all
categories of intellectual property:
(i) that are subject of Articles 112 through
118; and/or
(ii) that are under the TRIPS Agreement and/or
the relevant international agreements
referred to in the TRIPS Agreement; and
(b) the term “Nice Classification” means the
classification established by the Nice Agreement
Concerning the International Classification of
Goods and Services for the Purposes of the
Registration of Marks of June 15, 1957, as
amended.
Article 108
National Treatment
and Most-Favoured-Nation Treatment
1. Each Party shall accord to nationals of the other
Party treatment no less favourable than that it accords to
its own nationals with regard to the protection of
intellectual property in accordance with Articles 3 and 5
of the TRIPS Agreement.
2. Each Party shall accord to nationals of the other
Party treatment no less favourable than that it accords to
the nationals of a non-Party with regard to the protection
of intellectual property in accordance with Articles 4 and
5 of the TRIPS Agreement.
3. For the purposes of this Article:
(a) the term “nationals” shall have the same meaning
as in the TRIPS Agreement; and
(b) the term “protection” shall include matters
affecting the availability, acquisition, scope,
maintenance and enforcement of intellectual
property rights as well as those matters
affecting the use of intellectual property rights
specifically addressed in this Chapter.
Article 109
Procedural Matters
1. For the purposes of providing efficient administration
of intellectual property protection system, each Party
shall take appropriate measures to improve its
administrative procedures concerning intellectual property
rights in line with international standards.
2. Neither Party may require the authentication of
signatures or other means of self-identification on
documents to be submitted to the competent authority of the
Party, including applications, translations into a language
accepted by such authority of any earlier application whose
priority is claimed, powers of attorney and certifications
of assignment, in the course of application procedure or
other administrative procedures on patents, utility models,
industrial designs, or trademarks.
3. Notwithstanding paragraph 2, a Party may require:
(a) the authentication of signatures or other means
of self-identification, if the law of the Party
so provides, where the signatures or other means
of self-identification concern the surrender of a
patent or a registration of utility models,
industrial designs or trademarks; and
(b) the submission of evidence if there is reasonable
doubt as to the authenticity of signatures or
other means of self-identification on documents
submitted to the competent authority of the
Party. Where the competent authority notifies
the person that the submission of evidence is
required, the notification shall state the reason
for requiring the submission.
4. Neither Party may require the certification of
translation of an earlier application whose priority is
claimed.
5. Each Party shall introduce and implement a system in
which a power of attorney for application procedures or
other administrative procedures on patents, utility models,
industrial designs, or trademarks before the competent
authority of the Party may relate to one or more
applications and/or registrations identified in the power
of attorney or, subject to any exception indicated by the
appointing person, to all existing and future applications
and/or registrations of that person.
6. Neither Party shall require that the submission of a
power of attorney be completed together with the filing of
the application as a condition for according a filing date
to the application.
7. Each Party shall endeavor to improve patent attorney
or registered intellectual property rights consultant
system with a view to further facilitating acquisition and
utilization of industrial property rights.
8. The applications for and the grants of patents and the
publications thereof shall be classified in accordance with
the international patent classification system established
under the Strasbourg Agreement Concerning the International
Patent Classification of March 24, 1971, as amended. The
applications for registration of, and the registrations of,
trademarks for goods and services and the publications
thereof shall be classified in accordance with the Nice
Classification.
Article 110
Transparency
For the purposes of further promoting transparency in
administration of intellectual property protection system,
each Party shall, in accordance with its laws and
regulations, take appropriate measures to:
(a) publish information on at least the applications
for and the grants of patents, the registrations
of utility models and industrial designs, and the
applications for registration of, and the
registrations of, trademarks and new varieties of
plants, and make available to the public
information contained in the dossiers thereof;
(b) make available to the public information on the
applications for the suspension by the customs
authority of the release of counterfeit trademark
or pirated copyright goods as a border measure;
and
(c) make available to the public information
(including statistical information) on its
efforts to provide effective enforcement of
intellectual property rights and other
information with regard to intellectual property
protection system (including standards or
guidelines on examination of the applications for
patents and the applications for registration of
industrial designs and trademarks).
Article 111
Promotion of Public Awareness
of Protection of Intellectual Property
The Parties shall endeavor to promote public awareness
of protection of intellectual property including
educational and dissemination projects on the use of
intellectual property as well as on the enforcement of
intellectual property rights.
Article 112
Patents
1. Each Party shall ensure that any patent application is
not rejected solely on the ground that the subject matter
claimed in the application is related to a computer
program.
2. Each Party shall ensure that an applicant may, on its
own initiative, divide a patent application containing more
than one invention into a certain number of divisional
patent applications within the time limit provided for in
the laws and regulations of the Party.
3. Each Party shall ensure that an application for a
patent is examined upon the request of the applicant, where
appropriate, in preference to other applications, if the
applicant has filed an application for a patent of the same
or substantially the same invention in the other Party or
in any non-Party. Each Party may require the applicant to
furnish, together with the request, a result of relevant
prior art search, or a copy of the final decision by the
administrative authority for patents of the other Party or
of a non-Party (hereinafter referred to in this Article as
“the final decision”) on the application filed in the other
Party or in the non-Party.
4. Notwithstanding paragraph 3, a Party which requires,
pursuant to relevant provisions of its laws and
regulations, the applicant who filed an application for a
patent in that Party to furnish a copy of the final
decision on an application for a patent of the same or
substantially the same invention which the applicant filed
in the other Party or in any non-Party, shall examine the
application in preference to other applications, if the
applicant furnishes the aforementioned copy.
5. Each Party shall ensure that any person may provide
the administrative authority for patents with information
in writing that could deny novelty or inventive step of
inventions claimed in patent applications during the
pendency of those applications. Each Party shall take the
information, as appropriate, into consideration for
examining those applications.
6. Each Party shall ensure that an applicant may make
amendments to its patent application within a certain
period, in accordance with the laws and regulations of the
Party, after the filing of its appeal petition with respect
to the refusal of such application by the administrative
authority for patents.
7. Each Party shall provide that at least the following
acts shall be deemed as an infringement of a patent right
if performed without the consent of the patent owner:
(a) in the case of a patent for an invention of
product, acts of manufacturing, assigning,
leasing, importing, or offering for assignment or
lease, for commercial purposes, things to be used
exclusively for the manufacture of the product;
and
(b) in the case of a patent for an invention of
process, acts of manufacturing, assigning,
leasing, importing, or offering for assignment or
lease, for commercial purposes, things to be used
exclusively for the working of such invention.
Article 113
Industrial Designs
1. Each Party shall provide for the protection of
independently created industrial designs that are new or
original. Each Party shall provide that designs are not
new or original if they do not significantly differ from
known designs.
2. Each Party shall ensure that where more than one
application for registration of industrial design relating
to the same or similar industrial designs is filed on
different dates, only the applicant who filed first may
obtain a registration of the industrial design concerned.
3. Each Party shall ensure adequate and effective
protection of industrial designs of a part of an article as
well as an article as a whole.
4. Each Party shall ensure that an owner of protected
industrial design has the right to prevent third parties
not having the owner’s consent from making, selling or
importing articles bearing or embodying a design which is
identical or similar to the protected design, when such act
is undertaken for commercial purposes.
5. Each Party shall endeavor to establish appeal system
in which an appeal may be filed with the administrative
authority for industrial designs against its decision of
refusal of an application for registration of industrial
design.
Article 114
Trademarks
1. Each Party shall ensure that an owner of registered
trademark has the exclusive right to prevent all third
parties not having the owner’s consent from using in the
course of trade identical or similar signs for goods or
services which are identical or similar to those in respect
of which the trademark is registered, where such use would
result in a likelihood of confusion.
2. Each Party shall refuse or cancel the registration of
a trademark, which is identical or similar to a trademark
well-known in either Party as indicating goods or services
of another person, if the use of that trademark is for
unfair intentions, inter alia, intentions to gain an unfair
profit or intentions to cause damage to such person whether
or not such use would result in a likelihood of confusion.
3. Each Party shall ensure that, where more than one
application for registration of trademark relating to
identical or similar trademarks which are to be used on
identical or similar goods or services is filed on
different dates, only the applicant who filed first may
obtain a registration for the trademark concerned.
4. Each Party shall ensure that one and the same
application for registration of trademark may relate to
several goods and/or services, irrespective of whether they
belong to one class or to several classes of the Nice
Classification.
5. Each Party shall ensure that the period during which
the request for renewal of registration of a trademark may
be presented and the renewal fee may be paid shall start at
least six months before the date on which the renewal is
due and shall end at the earliest six months after that
date.
Article 115
Copyright and Related Rights
1. Each Party shall provide to authors all exclusive
rights protected under the Berne Convention for the
Protection of Literary and Artistic Works of September 9,
1886, as amended and the WIPO Copyright Treaty of December
20, 1996 (hereinafter referred to in this Article as “the
WIPO Copyright Treaty”).
2. Each Party shall provide to performers and producers
of phonograms all exclusive rights protected under the WIPO
Performances and Phonograms Treaty of December 20, 1996,
(hereinafter referred to in this Article as “the WIPO
Performances and Phonograms Treaty”).
3. Each Party shall provide to broadcasting and
cablecasting organizations the right to authorize or
prohibit the fixation of their broadcasts and cablecasts,
respectively, in accordance with its laws and regulations.
4. Each Party shall provide adequate and effective legal
remedies against any person knowingly performing any of the
following acts knowing, or with respect to civil remedies
having reasonable grounds to know, that it will induce,
enable, facilitate or conceal an infringement of copyright
or related rights:
(a) to remove or alter any electronic rights
management information without authority; and
(b) to distribute, import for distribution,
broadcast, communicate or make available to the
public, without authority, works, copies of
works, performances, copies of fixed performances
or phonograms knowing that electronic rights
management information has been removed or
altered without authority.
5. Each Party shall take necessary measures to promote
the development of collective management organizations for
copyright and related rights in the Party.
6. For the purposes of this Article:
(a) with respect to the rights of authors, the term
“rights management information” shall have the
same meaning as in Article 12 of the WIPO
Copyright Treaty; and
(b) with respect to the rights of performers and
producers of phonogram, the term “rights
management information” shall have the same
meaning as in Article 19 of the WIPO Performances
and Phonograms Treaty.
Article 116
New Varieties of Plants
Each Party shall provide for the protection of all
plant genera and species by an effective plant varieties
protection system which is consistent with the 1991 UPOV
Convention.
Article 117
Acts of Unfair Competition
1. Each Party shall provide for effective protection
against acts of unfair competition.
2. Any act of competition contrary to honest practices in
industrial or commercial matters constitutes an act of
unfair competition.
3. The following acts, in particular, shall be prohibited
as acts of unfair competition:
(a) all acts of such a nature as to create confusion
by any means whatever with the establishment, the
goods, the services, or the industrial or
commercial activities, of a competitor;
(b) false allegations in the course of trade of such
a nature as to discredit the establishment, the
goods, the services, or the industrial or
commercial activities, of a competitor;
(c) indications or allegations the use of which in
the course of trade is liable to mislead the
public as to the nature, the characteristics, the
suitability for their purpose, or the quantity,
of the goods or services, or the manufacturing
process of the goods; and
(d) acts by an agent or representative of an owner of
right relating to a trademark, without a
legitimate reason and the consent of the owner of
such right, of using a trademark identical or
similar to the trademark relating to such right
in respect of goods or services identical or
similar to those relating to such right; of
assigning, delivering, displaying for the
purposes of assignment or delivery, exporting,
importing, or providing through a
telecommunication line, goods using such
identical or similar trademark which are
identical or similar to the goods relating to
such right; or of providing services by using
such identical or similar trademark which are
identical or similar to the services relating to
such right.
4. The following acts may also be prohibited as acts of
unfair competition:
(a) acts of using an indication of goods or other
indication as one’s own which is identical or
similar to another person's indication of goods
or other indication which is famous; or acts of
assigning, delivering, displaying for the
purposes of assignment or delivery, exporting,
importing, or providing through a
telecommunication line, goods using such
indication;
(b) acts of assigning, leasing, displaying for the
purposes of assignment or lease, exporting or
importing, goods which imitate the configuration
of another person's goods except as provided for
in the laws and regulations of each Party; and
(c) acts of acquiring or holding right to use domain
names identical or similar to a specific
indication of goods or services of another
person, or using such domain names, with
intention to gain unfair profit or intention of
causing damage to such person.
5. Each Party shall establish appropriate remedies to
prevent or punish acts of unfair competition. In
particular, each Party shall ensure that any person that
considers its business interests to be affected by an act
of unfair competition may bring legal action and request
injunction against the act, destruction of the goods which
constitute the act, removal of facilities used for the act,
or any damages which result from the act, except as
provided for in the laws and regulations of the Party.
Article 118
Protection of Undisclosed Information
Each Party shall ensure in its laws and regulations
adequate and effective protection of undisclosed
information in accordance with Article 39 of the TRIPS
Agreement.
Article 119
Enforcement – Border Measures
1. Each Party shall adopt procedures to enable a right
holder, who has valid grounds for suspecting that the
importation or exportation of counterfeit trademark or
pirated copyright goods may take place, to lodge an
application in writing with competent authorities,
administrative or judicial, for the suspension by the
customs authority of the release into free circulation of
such goods.
2. In the case of the suspension with respect to
importation pursuant to paragraph 1, the importer and the
right holder shall be promptly notified of the suspension.
In the case of the suspension with respect to exportation
pursuant to paragraph 1, the exporter and the right holder
shall be promptly notified of the suspension.
3. Each Party shall ensure that its competent authorities
do not allow the re-exportation of counterfeit trademark or
pirated copyright goods other than in exceptional
circumstances.
Article 120
Enforcement – Civil Remedies
1. Each Party shall ensure that a right holder of
intellectual property has the right to claim against the
infringer damages adequate to compensate for the injury the
right holder has suffered because of an infringement of
that person’s intellectual property right by an infringer
who knowingly, or with reasonable grounds to know, engaged
in infringing activity.
2. Each Party shall endeavor, as necessary, to improve
its judicial system with a view to providing effective
civil remedies against infringement of intellectual
property rights.
Article 121
Enforcement – Criminal Remedies
Each Party shall provide for criminal procedures and
penalties to be applied in cases of the infringement of
patent rights, rights relating to utility models,
industrial designs, trademarks or layout-designs of
integrated circuits, copyrights or related rights, or plant
breeder’s rights, committed willfully and on a commercial
scale. Remedies available shall include imprisonment
and/or monetary fines sufficient to provide a deterrent,
consistently with the level of penalties applied for crimes
of a corresponding gravity.
Article 122
Cooperation
1. The Parties, recognizing the growing importance of
protection of intellectual property in pursuing further
promotion of trade and investment between the Parties, in
accordance with their respective laws and regulations and
subject to their available resources, shall cooperate in
the field of intellectual property. Costs of cooperation
under this Article shall be borne in as an equitable manner
as possible.
2. Areas and forms of cooperation under this Article
shall be set forth in the Implementing Agreement.
Article 123
Sub-Committee on Intellectual Property
For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Intellectual Property (hereinafter referred to
in this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) discussing any issues related to intellectual
property with a view to enhancing protection of
intellectual property and enforcement of
intellectual property rights and to promoting
efficient and transparent administration of
intellectual property protection system;
(c) exchanging views on the following issues:
(i) protection of genetic resources, traditional
knowledge and folklore; and
(ii) liability of internet service providers;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
Chapter 10
Government Procurement
Article 124
Exchange of Information
1. Each Party shall, subject to its laws and regulations,
respond in a timely manner to reasonable requests from the
other Party for information on its laws and regulations,
policies and practices on government procurement, as well
as any reforms to its existing government procurement
regimes.
2. The exchange of information under paragraph 1 shall be
facilitated through the following governmental authorities:
(a) for Japan, the Ministry of Foreign Affairs; and
(b) for Indonesia, the State Ministry of National
Development Planning (BAPPENAS).
Article 125
Sub-Committee on Government Procurement
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Government Procurement (hereinafter referred
to in this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) reviewing and monitoring the implementation and
operation of this Chapter;
(b) exchanging views on laws and regulations,
policies and practices, and other mutually agreed
issues regarding government procurement;
(c) discussing ways to facilitate cooperations
between relevant entities of the Parties in the
field of government procurement;
(d) reporting the findings of the Sub-Committee to
the Joint Committee; and
(e) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The decision by each Party on the composition of
representatives of the Government of the Party to the
Sub-Committee, shall be facilitated by its
governmental authority referred to in paragraph 2 of
Article 124.
Chapter 11
Competition
Article 126
Promotion of Competition
by Addressing Anti-competitive Activities
Each Party shall, in accordance with its laws and
regulations, promote competition by addressing anticompetitive
activities, in order to facilitate the
efficient functioning of its market.
Note: For the purposes of this Chapter, the term
“anti-competitive activities” means any conduct
or transaction that may be subject to penalties
or relief under the competition laws and
regulations of either Party.
Article 127
Cooperation on the Promotion of Competition
1. The Parties shall, in accordance with their respective
laws and regulations, cooperate on the promotion of
competition by addressing anti-competitive activities, and
on the capacity building for strengthening competition
policy and implementation of competition laws and
regulations, subject to their respective available
resources.
2. The details and procedures of cooperation under this
Article shall be specified in the Implementing Agreement.
Article 128
Non-Discrimination
Each Party shall apply its competition laws and
regulations in a manner which does not discriminate between
persons in like circumstances on the basis of their
nationality.
Article 129
Procedural Fairness
Each Party shall implement administrative and judicial
procedures in a fair manner to address anti-competitive
activities, pursuant to its relevant laws and regulations.
Article 130
Non-Application of Paragraph 2 of Article 9
Paragraph 2 of Article 9 shall not apply to this
Chapter.
Chapter 12
Improvement of Business Environment
and Promotion of Business Confidence
Article 131
Basic Principles
1. The Parties, confirming their interest in creating a
more favourable business environment with a view to
promoting trade and investment activities by enterprises of
the Parties, shall from time to time have consultations in
order to address issues concerning the improvement of the
business environment in the Parties and to facilitate the
promotion of the business confidence among enterprises of
the Parties.
2. Each Party shall, in accordance with its laws and
regulations, take appropriate measures to further improve
the business environment for the benefit of the enterprises
of the Parties conducting their business activities in the
Parties.
3. The Parties shall, in accordance with their respective
laws and regulations, promote cooperation to further
improve the business environment in their respective
Parties and take necessary measures including establishing
such mechanisms as provided for in subparagraph 1(j) of
Article 15 and Article 133.
Article 132
Sub-Committee on Improvement of Business Environment
and Promotion of Business Confidence
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Improvement of Business Environment and
Promotion of Business Confidence(hereinafter referred to in
this Article as “the Sub-Committee”) established in
accordance with Article 15 shall be:
(a) addressing issues in relation to the improvement
of business environment and the promotion of the
business confidence that the Sub-Committee
considers appropriate, taking into account, as
necessary, the findings reported by a Liaison
Office on Improvement of Business Environment
established in accordance with Article 133, and
in cooperation with other relevant Sub-Committees
or existing mechanisms with a view to avoiding
unnecessary overlap with the works of such Sub-
Committees or mechanisms;
(b) reporting the findings and making recommendations
to the Parties, including the measures to be
taken by the Parties, regarding such functions as
referred to in subparagraph (a). The Parties
shall take into consideration such
recommendations. The Sub-Committee may consult
with the Joint Committee prior to the submission
of recommendations to the Parties;
(c) where appropriate, reviewing the implementation
of the recommendations referred to in
subparagraph (b);
(d) making available, where appropriate, to
enterprises of the Parties the recommendations
referred to in subparagraph (b) and the results
of the review referred to in subparagraph (c) in
an appropriate manner;
(e) reporting the recommendations referred to in
subparagraph (b) and other findings in relation
to the implementation and operation of this
Chapter to the Joint Committee; and
(f) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The other details of the Sub-Committee may be set
forth in the Implementing Agreement.
Article 133
Liaison Office on Improvement of Business Environment
1. Each Party shall designate and maintain a Liaison
Office on Improvement of Business Environment for the
purposes of this Chapter.
2. The functions and other details of the Liaison Office
on Improvement of Business Environment may be set forth in
the Implementing Agreement.
Chapter 13
Cooperation
Article 134
Basic Principles
The Parties shall promote cooperation under this
Agreement for their mutual benefits in order to liberalize
and facilitate trade and investment between the Parties and
to promote the well-being of the peoples of the Parties.
For this purpose, the Parties shall cooperate between the
Governments of the Parties and, where necessary and
appropriate, encourage and facilitate cooperation between
the parties other than the Governments of the Parties, in
the following fields:
(a) manufacturing industries;
(b) agriculture, forestry and fisheries;
(c) trade and investment promotion;
(d) human resource development;
(e) tourism;
(f) information and communications technology;
(g) financial services;
(h) government procurement;
(i) environment; and
(j) other fields to be mutually agreed upon by the
Parties.
Note: Cooperation in the fields of customs procedures,
energy and mineral resources, intellectual property
and competition is provided for in Chapters 4, 8, 9
and 11, respectively.
Article 135
Areas and Forms of Cooperation
Areas and forms of cooperation under this Chapter may
be set forth in the Implementing Agreement.
Article 136
Costs of Cooperation
1. The Parties shall endeavor to make available the
necessary funds and other resources for the implementation
of cooperation under this Chapter in accordance with their
respective laws and regulations.
2. Costs of cooperation under this Chapter shall be borne
in an equitable manner to be mutually agreed upon by the
Parties.
Article 137
Sub-Committee on Cooperation
1. For the purposes of the effective implementation and
operation of this Chapter, the functions of the Sub-
Committee on Cooperation (hereinafter referred to in this
Article as “the Sub-Committee”) established in accordance
with Article 15 shall be:
(a) exchanging information on cooperation;
(b) reviewing, monitoring and giving guidance on the
implementation and operation of this Chapter;
(c) identifying ways for further cooperation;
(d) discussing any issues related to this Chapter;
(e) reporting the findings of the Sub-Committee to
the Joint Committee; and
(f) carrying out other functions as may be delegated
by the Joint Committee in accordance with Article
14.
2. The Sub-Committee shall respect consultation
mechanisms for Official Development Assistance and other
cooperation schemes between the Parties and, as
appropriate, share information and coordinate with such
mechanisms and schemes to ensure effective and efficient
implementation of cooperative activities and projects.
Chapter 14
Dispute Settlement
Article 138
Scope
1. This Chapter shall apply with respect to the
settlement of disputes between the Parties arising out of
the interpretation and/or application of this Agreement.
2. Notwithstanding paragraph 1, this Chapter except
Article 139 shall not apply to Articles 104 and 122, and
Chapters 10 through 13.
3. Nothing in this Chapter shall prejudice any rights of
the Parties to have recourse to dispute settlement
procedures available under any other international
agreement to which both Parties are parties.
4. Notwithstanding paragraph 3, once a dispute settlement
procedure has been initiated under this Chapter or under
any other international agreement to which both Parties are
parties with respect to a particular dispute, that
procedure shall be used to the exclusion of any other
procedure for that particular dispute.
Article 139
General Principle
Any dispute between the Parties arising out of the
interpretation and/or application of this Agreement shall,
as far as possible, be settled peacefully and amicably.
Article 140
Consultations
1. Either Party may request in writing consultations to
the other Party concerning any matter arising out of the
interpretation and/or application of this Agreement.
2. When a Party requests consultations pursuant to
paragraph 1, the other Party shall reply to the request and
enter into consultations in good faith within 60 days after
the date of receipt of the request. In a case of
consultations regarding perishable goods, the other Party
shall enter into consultations within 20 days after the
date of receipt of the request.
3. Unless otherwise agreed by the Parties, consultations
shall be treated as confidential. Consultations shall be
without prejudice to the rights of either Party in any
further proceedings.
Article 141
Good Offices, Conciliation or Mediation
1. Good offices, conciliation or mediation may be
requested at any time by either Party. They may begin at
any time by agreement of the Parties, and be terminated at
any time upon the request of either Party.
2. If the Parties agree, good offices, conciliation or
mediation may continue while procedures of the arbitral
tribunal provided for in this Chapter are in progress.
3. Proceedings involving good offices, conciliation or
mediation and positions taken by the Parties during these
proceedings, shall be treated as confidential, and without
prejudice to the rights of either Party in any further
proceedings.
Article 142
Establishment of Arbitral Tribunals
1. The complaining Party that requested consultations
under Article 140 may request in writing the establishment
of an arbitral tribunal to the Party complained against:
(a) if the Party complained against does not enter
into such consultations within 60 days, or within
20 days in a case of consultations regarding
perishable goods, after the date of receipt of
the request for such consultations; or
(b) if the Parties fail to resolve the dispute
through such consultations within 90 days, or
within 50 days in a case of consultations
regarding perishable goods, after the date of
receipt of the request for such consultations,
provided that the complaining Party considers that any
benefit accruing to it under this Agreement is being
nullified or impaired as a result of the failure of the
Party complained against to carry out its obligations under
this Agreement, or as a result of the application by the
Party complained against of measures which are in conflict
with its obligations under this Agreement.
2. Any request to establish an arbitral tribunal pursuant
to this Article shall identify:
(a) the legal basis of the complaint including the
provisions of this Agreement alleged to have been
breached and any other relevant provisions; and
(b) the factual basis for the complaint.
3. The arbitral tribunal shall comprise three
arbitrators, who should have relevant technical or legal
expertise.
4. Each Party shall, within 45 days after the date of
receipt of the request for the establishment of an arbitral
tribunal, appoint one arbitrator who may be its national
and propose up to three candidates to serve as the third
arbitrator who shall be the chair of the arbitral tribunal.
The third arbitrator shall not be a national of either
Party, nor have his or her usual place of residence in
either Party, nor be employed by either Party, nor have
dealt with the dispute in any capacity.
5. The Parties shall agree on and appoint the third
arbitrator within 60 days after the date of receipt of the
request for the establishment of an arbitral tribunal,
taking into account the candidates proposed pursuant to
paragraph 4.
6. If a Party has not appointed an arbitrator pursuant to
paragraph 4 or if the Parties fail to agree on and appoint
the third arbitrator pursuant to paragraph 5, the
arbitrator or arbitrators not yet appointed shall be chosen
within 15 days by lot from the candidates proposed pursuant
to paragraph 4.
7. The date of the establishment of an arbitral tribunal
shall be the date on which the chair is appointed.
Article 143
Functions of Arbitral Tribunals
1. The arbitral tribunal established pursuant to Article
142:
(a) should consult with the Parties as appropriate
and provide adequate opportunities for the
development of a mutually satisfactory
resolution;
(b) shall make its award in accordance with this
Agreement and applicable rules of international
law; and
(c) shall set out, in its award, its findings of law
and fact, together with the reasons therefore.
2. The arbitral tribunal may seek, from the Parties, such
relevant information as it considers necessary and
appropriate. The Parties shall respond promptly and fully
to any request by the arbitral tribunal for such
information as the arbitral tribunal considers necessary
and appropriate.
3. The arbitral tribunal may seek information from any
relevant source and may consult experts to obtain their
opinion on certain aspects of the matter. With respect to
factual issues concerning a scientific or other technical
matter raised by a Party, the arbitral tribunal may request
advisory reports in writing from experts.
4. The arbitral tribunal may, at the request of a Party
or on its own initiative, select, in consultation with the
Parties, no fewer than two scientific or technical experts
who shall assist the arbitral tribunal throughout its
proceedings, but who shall not have the right to vote in
respect of any decision to be made by the arbitral
tribunal, including its award.
Article 144
Proceedings of Arbitral Tribunals
1. The arbitral tribunal shall meet in closed session.
2. The venue for the proceedings of the arbitral tribunal
shall be decided by mutual consent of the Parties, failing
which it shall alternate between the Parties.
3. The deliberations of the arbitral tribunal and the
documents submitted to it shall be kept confidential.
4. Notwithstanding paragraph 3, either Party may make
public statements as to its views regarding the dispute,
but shall treat as confidential, information and written
submissions submitted by the other Party to the arbitral
tribunal which that other Party has designated as
confidential. Where a Party has provided information or
written submissions designated to be confidential, that
Party shall, upon request of the other Party, provide a
non-confidential summary of the information or written
submissions which may be disclosed publicly.
5. The Parties shall be given the opportunity to attend
any of the presentations, statements or rebuttals in the
proceedings. Any information or written submissions
submitted by a Party to the arbitral tribunal, including
any comments on the descriptive part of the draft award and
responses to questions put by the arbitral tribunal, shall
be made available to the other Party.
6. The award of the arbitral tribunal shall be drafted
without the presence of the Parties, and in the light of
the information provided and the statements made.
7. The arbitral tribunal shall, within 90 days after the
date of its establishment, submit to the Parties its draft
award, including both the descriptive part and its findings
and conclusions, for the purposes of enabling the Parties
to review precise aspects of the draft award. When the
arbitral tribunal considers that it cannot submit its draft
award within the aforementioned 90 days period, it may
extend that period with the consent of the Parties. A
Party may submit comments in writing to the arbitral
tribunal on the draft award within 15 days after the date
of submission of the draft award.
8. The arbitral tribunal shall issue its award, within 30
days after the date of submission of the draft award.
9. The arbitral tribunal shall attempt to make its
decisions, including its award, by consensus but may also
make its decisions, including its award, by majority vote.
10. The award of the arbitral tribunal shall be final and
binding on the Parties.
Article 145
Suspension and Termination of Proceedings
1. Where the Parties agree, the arbitral tribunal may
suspend its work at any time for a period not to exceed 12
months. In the event of such a suspension, the time-frames
set out in paragraphs 7 and 8 of Article 144 and paragraph
8 of Article 146 shall be extended by the amount of time
that the work was suspended. The proceedings of the
arbitral tribunal shall be resumed at any time upon the
request of either Party. If the work of the arbitral
tribunal has been suspended for more than 12 months, the
authority for establishment of the arbitral tribunal shall
lapse unless the Parties agree otherwise.
2. The Parties may agree to terminate the proceedings of
the arbitral tribunal at any time before the issuance of
the award to the Parties by jointly so notifying the chair
of the arbitral tribunal.
Article 146
Implementation of Award
1. The Party complained against shall promptly comply
with the award of the arbitral tribunal issued pursuant to
Article 144.
2. The Party complained against shall, within 20 days
after the date of issuance of the award, notify the
complaining Party of the period of time for implementing
the award. If the complaining Party considers the period
of time notified to be unacceptable, it may request to the
Party complained against consultations with a view to
reaching a mutually satisfactory implementation period. If
no satisfactory implementation period has been agreed
within 30 days after the date of receipt of the request,
the complaining Party may refer the matter to an arbitral
tribunal.
3. If the Party complained against considers it
impracticable to comply with the award within the
implementation period as determined pursuant to paragraph
2, the Party complained against shall, no later than the
expiry of that implementation period, enter into
consultations with the complaining Party, with a view to
developing mutually satisfactory resolution through
compensation or any alternative arrangement. If no
satisfactory resolution has been agreed within 30 days
after the date of expiry of that implementation period, the
complaining Party may notify the Party complained against
that it intends to suspend the application to the Party
complained against of concessions or other obligations
under this Agreement.
4. If the complaining Party considers that the Party
complained against has failed to comply with the award
within the implementation period as determined pursuant to
paragraph 2, it may refer the matter to an arbitral
tribunal.
5. If the arbitral tribunal to which the matter is
referred pursuant to paragraph 4 confirms that the Party
complained against has failed to comply with the award
within the implementation period as determined pursuant to
paragraph 2, the complaining Party may, within 30 days
after the date of such confirmation by the arbitral
tribunal, notify the Party complained against that it
intends to suspend the application to the Party complained
against of concessions or other obligations under this
Agreement.
6. The suspension of the application of concessions or
other obligations under paragraphs 3 and 5 may only be
implemented at least 30 days after the date of the
notification in accordance with those paragraphs. Such
suspension shall:
(a) not be effected if, in respect of the dispute to
which the suspension relates, consultations or
proceedings before the arbitral tribunal are in
progress;
(b) be temporary, and be discontinued when the
Parties reach a mutually satisfactory resolution
or where compliance with the original award is
effected;
(c) be restricted to the same level of nullification
or impairment that is attributable to the failure
to comply with the original award; and
(d) be restricted to the same sector or sectors to
which the nullification or impairment relates,
unless it is not practicable or effective to
suspend the application of concessions or other
obligations in such sector or sectors.
7. If the Party complained against considers that the
requirements for the suspension of the application to it of
concessions or other obligations under this Agreement by
the complaining Party set out in paragraph 3, 5 or 6 have
not been met, it may request consultations with the
complaining Party. The complaining Party shall enter into
consultations within 10 days after the date of receipt of
the request. If the Parties fail to resolve the matter
within 30 days after the date of receipt of the request for
consultations pursuant to this paragraph, the Party
complained against may refer the matter to an arbitral
tribunal.
8. The arbitral tribunal that is established for the
purposes of this Article shall, wherever possible, have, as
its arbitrators, the arbitrators of the original arbitral
tribunal. If this is not possible, then the arbitrators to
the arbitral tribunal that is established for the purposes
of this Article shall be appointed pursuant to paragraphs 4
through 6 of Article 142. The arbitral tribunal
established for the purposes of this Article shall issue
its award within 60 days after the date when the matter is
referred to it. Such award shall be binding on the
Parties.
Article 147
Modification of Time Periods
Any time period provided for in this Chapter may be
modified by mutual consent of the Parties.
Article 148
Expenses
Unless the Parties agree otherwise, the expenses of
the arbitral tribunal, including the remuneration of its
arbitrators, shall be borne by the Parties in equal shares.
Chapter 15
Final Provisions
Article 149
Table of Contents and Headings
The table of contents and headings of the Chapters and
the Articles of this Agreement are inserted for convenience
of reference only and shall not affect the interpretation
of this Agreement.
Article 150
Annexes and Notes
The Annexes and Notes to this Agreement shall form an
integral part of this Agreement.
Article 151
General Review
The Parties shall undertake a general review of the
implementation and operation of this Agreement in the fifth
calendar year following the calendar year in which this
Agreement enters into force, and every five years
thereafter, unless otherwise agreed by the Parties.
Article 152
Amendment
1. This Agreement may be amended by agreement between the
Parties.
2. Such amendment shall be approved by the Parties in
accordance with their respective legal procedures, and
shall enter into force on the date to be agreed upon by the
Parties.
3. Notwithstanding paragraph 2, amendments relating only
to Annex 2 or 3 may be made by diplomatic notes exchanged
between the Governments of the Parties.
Article 153
Entry into Force
This Agreement shall enter into force on the thirtieth
day after the date on which the Governments of the Parties
exchange diplomatic notes informing each other that their
respective legal procedures necessary for entry into force
of this Agreement have been completed. It shall remain in
force unless terminated as provided for in Article 154.
Article 154
Termination
Either Party may terminate this Agreement by giving
one year’s advance notice in writing to the other Party.
IN WITNESS WHEREOF, the undersigned, being duly
authorized thereto, have signed this Agreement.
DONE at Jakarta on this twentieth day of August in the
year 2007 in duplicate in the English language.
For Japan:
安倍晋三
For the Republic of
Indonesia:
S.B.Yudhoyono
Rating: 5
Reviewer: Info Petani -
ItemReviewed: AGREEMENT BETWEEN JAPAN AND THE REPUBLIC OF INDONESIA FOR AN ECONOMIC PARTNERSHIP - 9756people
Info Petani -
