3.      The Parties affirm their commitment to pursue sustainable development, which consists of economic development, social development and environmental protection all three being

inter-dependent and mutually reinforcing.

4.      The Parties underline the benefits of cooperating on trade-related labour1 and environmental issues as part of the global approach to trade and sustainable development.

5.      This Chapter embodies a cooperative approach based on common values and interests, taking into account the differences in the Parties' respective levels of development.

ARTICLE 13.2

Right to Regulate and Levels of Protection

1.      The Parties recognise their respective right to:

(a)     determine its sustainable development objectives, strategies, policies and priorities;

(b)     establish its own levels of domestic protection in the environmental and social areas as it deems appropriate; and

(c)     adopt or modify accordingly its relevant laws and policies in a manner consistent with the internationally recognised standards, and the agreements, to which a Party is party, referred to in Articles 13.4 (Multilateral Labour Standards and Agreements) and 13.5 (Multilateral Environmental Agreements).

2.      Each Party shall endeavour to ensure that its laws and policies provide for and encourage high levels of domestic protection in the environmental and social areas and shall continuously endeavour to improve those laws and policies.

ARTICLE 13.3

Upholding Levels of Protection

1.      The Parties stress that weakening the levels of protection in environmental or labour areas is detrimental to the objectives of this Chapter and that it is inappropriate to encourage trade and investment by weakening the levels of protection afforded in domestic environmental or labour law.

2.      A Party shall not waive or derogate from, or offer to waive or derogate from, its environmental or labour laws, in a manner affecting trade and investment between the Parties.

3.      A Party shall not, through a sustained or recurring course of action or inaction, fail to effectively enforce its environmental and labour laws, as an encouragement for trade and investment.

4.      A Party shall not apply environmental and labour laws in a manner that would constitute a means of arbitrary or unjustifiable discrimination between the Parties or a disguised restriction on trade.

ARTICLE 13.4

Multilateral Labour Standards and Agreements

1.      The Parties recognise the importance of full and productive employment and decent work for all, in particular as a response to globalisation. The Parties reaffirm their commitment to promote the development of their bilateral trade in a way that is conducive to full and productive employment and decent work for all, including for women and young people. In this context, the Parties shall consult and cooperate, as appropriate, on trade-related labour issues of mutual interest.

2.      Each Party reaffirms its commitments, in accordance with its obligations under the ILO and the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up, adopted by the International Labour Conference at its 86th Session in 1998, to respect, promote and effectively implement the principles concerning the fundamental rights at work, namely:

(a)     the freedom of association and the effective recognition of the right to collective bargaining;

(b)    the elimination of all forms of forced or compulsory labour;