CHAPTER 3: DISPUTE SETTLEMENT

SECTION A

RESOLUTION OF DISPUTES BETWEEN PARTIES

SUB-SECTION 1

OBJECTIVE AND SCOPE

ARTICLE 3.1

Objective

The objective of this Chapter is to establish an effective and efficient mechanism for avoiding and settling any dispute between the Parties regarding the interpretation and application of this Agreement with a view to arriving at a mutually agreed solution.

ARTICLE 3.2

Scope

This Chapter applies with respect to the avoidance and settlement of any dispute between the Parties regarding the interpretation or application of the provisions of this Agreement, except as otherwise provided for in this Agreement.

SUB-SECTION 2

CONSULTATIONS AND MEDIATION

ARTICLE 3.3

Consultations

1.      The Parties shall endeavour to resolve any dispute referred to in Article 3.2 (Scope) by entering into consultations in good faith with the aim of reaching a mutually agreed solution.

2.      A Party shall seek consultations by means of a written request to the other Party, copied to the Committee established pursuant to Article 4.1 (Committee), identifying the measure at issue and the relevant provisions of this Agreement.

3.      Consultations shall be held within 30 days of the date of receipt of the request referred to in paragraph 2 and take place, unless the Parties agree otherwise, in the territory of the Party to which the request is made. The consultations shall be deemed concluded within 45 days of the date of receipt of the request, unless both Parties agree to continue consultations. Consultations, in particular all information disclosed and positions taken by the Parties, shall be confidential and without prejudice to the rights of either Party in any further proceedings.

4.      Consultations on matters of urgency, including those regarding perishable goods, seasonal goods or seasonal services, shall be held within 15 days of the date of receipt of the request referred to in paragraph 2. The consultations shall be deemed concluded within 20 days, unless both Parties agree to continue consultations.

5.      The Party that sought consultations may have recourse to Article 3.5 (Initiation of the Arbitration Procedure) if:

(a)     the other Party does not respond to the request for consultations within 15 days of the date of its receipt;

(b)    the consultations are not held within the timeframes provided for in paragraphs 3 or 4;

(c)     the Parties agree not to have consultations; or

(d)    the consultations have been concluded without a mutually agreed solution.