22014A0830(02)

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Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Georgia, of the other part

OJ L 261, 30.8.2014, p. 4–743 (BG, ES, CS, DA, DE, ET, EL, EN, FR, HR, IT, LV, LT, HU, MT, NL, PL, PT, RO, SK, SL, FI, SV)

Legal status of the document In force: This act has been changed. Current consolidated version: 15/11/2023

ELI: http://data.europa.eu/eli/agree_internation/2014/494/oj

Related Council decision

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Official Journal

30.8.2014

Official Journal of the European Union

L 261/4

ASSOCIATION AGREEMENT

between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Georgia, of the other part

PREAMBLE

THE KINGDOM OF BELGIUM,

THE REPUBLIC OF BULGARIA,

THE CZECH REPUBLIC,

THE KINGDOM OF DENMARK,

THE FEDERAL REPUBLIC OF GERMANY,

THE REPUBLIC OF ESTONIA,

IRELAND,

THE HELLENIC REPUBLIC,

THE KINGDOM OF SPAIN,

THE FRENCH REPUBLIC,

THE REPUBLIC OF CROATIA,

THE ITALIAN REPUBLIC,

THE REPUBLIC OF CYPRUS,

THE REPUBLIC OF LATVIA,

THE REPUBLIC OF LITHUANIA,

THE GRAND DUCHY OF LUXEMBOURG,

HUNGARY,

THE REPUBLIC OF MALTA,

THE KINGDOM OF THE NETHERLANDS,

THE REPUBLIC OF AUSTRIA,

THE REPUBLIC OF POLAND,

THE PORTUGUESE REPUBLIC,

ROMANIA,

THE REPUBLIC OF SLOVENIA,

THE SLOVAK REPUBLIC,

THE REPUBLIC OF FINLAND,

THE KINGDOM OF SWEDEN,

THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND,

Contracting Parties to the Treaty on European Union and the Treaty on the Functioning of the European Union, hereinafter referred to as ‘the Member States’,

THE EUROPEAN UNION, hereinafter referred to as ‘the Union’ or ‘the EU’ and

THE EUROPEAN ATOMIC ENERGY COMMUNITY, hereinafter referred to as ‘the Euratom’

of the one part, and

GEORGIA,

of the other part,

hereafter jointly referred to as ‘the Parties’,

CONSIDERING the strong links and common values of the Parties, established in the past through the Partnership and Cooperation Agreement between the European Communities and their Member States, of the one part, and Georgia, of the other part, and being developed within the framework of the Eastern Partnership as a specific dimension of the European Neighbourhood Policy and recognising the common desire of the Parties to further develop, strengthen and extend their relations in an ambitious and innovative way;

ACKNOWLEDGING the European aspirations and European choice of Georgia;

RECOGNISING that the common values on which the EU is built –democracy, respect for human rights and fundamental freedoms, and the rule of law – lie also at the heart of political association and economic integration as envisaged in this Agreement;

RECOGNISING that Georgia, an Eastern European country, is committed to implementing and promoting these values;

RECOGNISING that Georgia shares historical links and common values with the Member States;

TAKING INTO ACCOUNT that this Agreement shall not prejudice and leaves open the way for future progressive developments in EU-Georgia relations;

COMMITTED to further strengthening respect for fundamental freedoms, human rights, including the rights of persons belonging to minorities, democratic principles, the rule of law, and good governance, based on common values of the Parties;

UNDERSTANDING that internal reforms towards strengthening democracy and market economy will facilitate participation of Georgia in EU policies, programmes and agencies. This process and sustainable conflict settlement will mutually reinforce each other and will contribute to build confidence between communities divided by conflict;

WILLING to contribute to the political, socio-economic and institutional development of Georgia through wide-ranging cooperation in a broad spectrum of areas of common interest, such as the development of civil society, good governance, including in the field of taxation, trade integration and enhanced economic cooperation, institution building, public administration and civil service reform and fight against corruption, the reduction of poverty and cooperation in the field of freedom, security and justice necessary to effectively implement this Agreement and noting the EU's readiness to support relevant reforms in Georgia;

COMMITTED to all the principles and provisions of the Charter of the United Nations, the Organisation for Security and Cooperation in Europe (OSCE), in particular of the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe, the concluding documents of the Madrid, Istanbul and Vienna Conferences of 1991 and 1992 respectively, and the Charter of Paris for a New Europe of 1990, as well as the United Nations Universal Declaration of Human Rights of 1948 and the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950.

RECALLING their will to promote international peace and security as well as engaging in effective multilateralism and the peaceful settlement of disputes, in particular by cooperating to that end within the framework of the United Nations (UN) and the OSCE;

COMMITTED to international obligations to fighting against the proliferation of weapons of mass destruction and their means of delivery and to cooperating on disarmament;

RECOGNISING the added value of the active participation of the Parties in various regional cooperation formats;

DESIROUS to further develop regular political dialogue on bilateral and international issues of mutual interest, including regional aspects, taking into account the Common Foreign and Security Policy (CFSP) of the European Union, including the Common Security and Defence Policy (CSDP);

FULLY RESPECTING the principles of independence, sovereignty, territorial integrity and the inviolability of the internationally recognised borders under international law, the Charter of the United Nations, the Final Act of the Helsinki Conference on Security and Cooperation in Europe and relevant United Nations Security Council resolutions;

RECOGNISING the importance of the commitment of Georgia to reconciliation and its efforts to restore its territorial integrity and full and effective control over Georgian regions of Abkhazia and the Tskhnivali region/South Ossetia in pursuit of a peaceful and lasting conflict resolution based on principles of international law, and of the EU's commitment to support a peaceful and lasting resolution of the conflict;

RECOGNISING in this context the importance of pursuing the implementation of the Six-Point Agreement of 12 August 2008 and its subsequent implementing measures, of meaningful international presence for maintaining peace and security on the ground, of pursuing mutually supportive non-recognition and engagement policies, of supporting the Geneva International Discussions and of safe and dignified return of all internally displaced persons and refugees in line with principles of international law;

COMMITTED to provide the benefits of closer political association and economic integration of Georgia with the EU to all citizens of Georgia including the communities divided by conflict;

COMMITTED to combating organised crime and illicit trafficking and to further strengthening cooperation in the fight against terrorism;

COMMITTED to deepening their dialogue and cooperation on mobility, migration, asylum and border management taking also into account the EU-Georgia Mobility Partnership, with a comprehensive approach paying attention to legal migration, including circular migration, and to cooperation aimed at tackling illegal migration, trafficking in human beings and efficient implementation of the readmission agreement;

RECOGNISING the importance of introducing a visa free travel regime for the citizens of Georgia in due course, provided that conditions for well-managed and secure mobility are in place including the effective implementation of visa facilitation and readmission agreements;

COMMITTED to the principles of free market economy and the readiness of the EU to contribute to the economic reforms in Georgia, including in the framework of the European Neighbourhood Policy and the Eastern Partnership;

COMMITTED to achieve economic integration in particular through a Deep and Comprehensive Free Trade Area (DCFTA), as an integral part of this Agreement including regulatory approximation and in compliance with the rights and obligations arising out of the membership of the Parties in the World Trade Organisation (WTO);

BELIEVING that this Agreement will create a new climate for economic relations between the Parties and above all for the development of trade and investment, and will stimulate competition, which are factors crucial to economic restructuring and modernisation;

COMMITTED to respecting the principles of sustainable development, to protecting the environment and mitigating climate change, to continuous improvement of environmental governance and meeting environmental needs, including cross-border cooperation and implementation of multilateral international agreements;

COMMITTED to enhancing the security of energy supply, including the development of the Southern Corridor by, inter alia, promoting the development of appropriate projects in Georgia facilitating the development of relevant infrastructure, including for transit through Georgia, increasing market integration and gradual regulatory approximation towards key elements of the EU acquis, and promoting energy efficiency and the use of renewable energy sources;

ACKNOWLEDGING the need for enhanced energy cooperation, and the commitment of the Parties to implement the Energy Charter Treaty;

WILLING to improve the level of public health safety and protection of human health as an essential element for sustainable development and economic growth;

COMMITTED to enhancing people-to-people contacts, including through cooperation and exchanges in the fields of science and technology, business, youth, education and culture;

COMMITTED to promoting cross-border and inter-regional cooperation by both sides in the spirit of good neighbourly relations;

RECOGNISING the commitment of Georgia to progressively approximating its legislation in the relevant sectors with that of the EU, in accordance with this Agreement and to implementing it effectively;

RECOGNISING the commitment of Georgia to developing its administrative and institutional infrastructure to the extent necessary to enforce this Agreement;

TAKING ACCOUNT of the willingness of the EU to provide support for the implementation of reforms, and to use all available instruments of cooperation and technical, financial and economic assistance in this endeavour;

CONFIRMING that the provisions of this Agreement that fall within the scope of Title V of Part Three of the Treaty on the Functioning of the European Union bind the United Kingdom and Ireland as separate Contracting Parties, and not as part of the EU, unless the EU together with the United Kingdom and/or Ireland have jointly notified Georgia that the United Kingdom or Ireland is bound as part of the EU in accordance with Protocol No 21 on the position of the United Kingdom and Ireland in respect of the Area of Freedom, Security and Justice, annexed to the Treaty on European Union and to the Treaty on the Functioning of the European Union. If the United Kingdom and/or Ireland ceases to be bound as part of the EU in accordance with Article 4a of that Protocol, the EU together with the United Kingdom and/or Ireland shall immediately inform Georgia of any change in their position in which case they shall remain bound by the provisions of this Agreement in their own right. The same applies to Denmark, in accordance with the Protocol No 22 on the position of Denmark, annexed to those Treaties.

HAVE DECIDED TO CONCLUDE THIS AGREEMENT:

Article 1

Objectives

1. An association is hereby established between the Union and its Member States, of the one part, and Georgia, of the other part.

2. The aims of this association are:

(a)	to promote political association and economic integration between the Parties based on common values and close links, including by increasing Georgia's participation in EU policies, programmes and agencies;

(b)	to provide a strengthened framework for enhanced political dialogue on all areas of mutual interest, allowing the development of close political relations between the Parties;

(c)	to contribute to the strengthening of democracy and to political, economic and institutional stability in Georgia;

(d)

to promote, preserve and strengthen peace and stability regionally and internationally, based on the principles of the Charter of the United Nations and the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe, including through joining efforts to eliminate sources of tension, enhance border security, and to promote cross-border cooperation and good neighbourly relations;

(e)	to promote cooperation aimed at peaceful conflict resolution;

(f)	to enhance cooperation in the area of freedom, security and justice with the aim of reinforcing the rule of law and the respect for human rights and fundamental freedoms;

(g)	to support the efforts of Georgia to develop its economic potential through international cooperation, including through the approximation of its legislation to that of the EU;

(h)

to achieve Georgia's gradual economic integration into the EU Internal Market, as stipulated in this Agreement, in particular through establishing a Deep and Comprehensive Free Trade Area which will provide for far-reaching market access on the basis of sustained and comprehensive regulatory approximation in compliance with the rights and obligations arising from its WTO membership;

(i)	to establish conditions for an increasingly close cooperation in other areas of mutual interest.

TITLE I

GENERAL PRINCIPLES

Article 2

General Principles

1. Respect for the democratic principles, human rights and fundamental freedoms, as proclaimed in the United Nations Universal Declaration of Human Rights of 1948 and as defined in the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950, the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe and the Charter of Paris for a New Europe of 1990 shall form the basis of the domestic and external policies of the Parties and constitutes an essential element of this Agreement. Countering the proliferation of weapons of mass destruction, related materials and their means of delivery also constitute essential elements of this Agreement.

2. The Parties reiterate their commitment to the principles of a free market economy, sustainable development and effective multilateralism.

3. The Parties reaffirm their respect for the principles of the rule of law and good governance, as well as their international obligations, in particular under the UN, the Council of Europe and the OSCE. In particular, they agree to promoting respect for the principles of sovereignty and territorial integrity, inviolability of borders and independence.

4. The Parties commit themselves to the rule of law, good governance, the fight against corruption, the fight against the various forms of transnational organised crime and terrorism, the promotion of sustainable development, effective multilateralism and the fight against the proliferation of weapons of mass destruction and their delivery systems. This commitment constitutes a key factor in the development of the relations and cooperation between the Parties and contributes to regional peace and stability.

TITLE II

POLITICAL DIALOGUE AND REFORM, COOPERATION IN THE FIELD OF FOREIGN AND SECURITY POLICY

Article 3

Aims of political dialogue

1. Political dialogue on all areas of mutual interest, including foreign and security matters as well as domestic reform, shall be further developed and strengthened between the Parties. This will increase the effectiveness of political cooperation and promote convergence on foreign and security matters, strengthening relations in an ambitious and innovative way.

2. The aims of political dialogue shall be:

(a)	to deepen political association and increase political and security policy convergence and effectiveness;

(b)	to promote the principles of territorial integrity, inviolability of internationally recognised borders, sovereignty and independence, as enshrined in the Charter of the United Nations and the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe;

(c)	to promote peaceful conflict resolution;

(d)	to promote international stability and security based on effective multilateralism;

(e)	to strengthen cooperation and dialogue between the Parties on international security and crisis management, in particular in order to address global and regional challenges and key threats;

(f)	to strengthen the cooperation in the fight against the proliferation of weapons of mass destruction (WMD) and their delivery systems including the conversion to alternative employment of scientists formerly employed in WMD programmes;

(g)	to foster result-oriented and practical cooperation between the Parties for achieving peace, security and stability on the European continent;

(h)	to strengthen respect for democratic principles, the rule of law and good governance, human rights and fundamental freedoms, including media freedom and the rights of persons belonging to minorities, and to contribute to consolidating domestic political reforms;

(i)	to develop dialogue and to deepen the cooperation of the Parties in the field of security and defence;

(j)	to work to further promote regional cooperation in various formats;

(k)	to provide all benefits of closer political association between the EU and Georgia, including increased security policy convergence to all citizens of Georgia within its internationally recognised borders.

Article 4

Domestic reform

The Parties shall cooperate on developing, consolidating and increasing the stability and effectiveness of democratic institutions and the rule of law; on ensuring respect for human rights and fundamental freedoms; on making further progress on judicial and legal reform, so that the independence of the judiciary is guaranteed, strengthening its administrative capacity and guaranteeing impartiality and effectiveness of law enforcement bodies; on further pursuing the public administration reform and on building an accountable, efficient, effective, transparent and professional civil service; and on continuing effective fight against corruption, particularly in view of enhancing international cooperation on combating corruption, and ensuring effective implementation of relevant international legal instruments, such as the United Nations Convention Against Corruption of 2003.

Article 5

Foreign and security policy

1. The Parties shall intensify their dialogue and cooperation and promote gradual convergence in the area of foreign and security policy, including the common security and defence policy, and shall address in particular issues of conflict prevention, peaceful conflict resolution and crisis management, regional stability, disarmament, non-proliferation, arms control and export control. Cooperation shall be based on common values and mutual interests, and shall aim at increasing policy convergence and effectiveness, making use of bilateral, international and regional fora.

2. The Parties reaffirm their commitment to the principles of territorial integrity, inviolability of internationally recognised borders, sovereignty and independence, as established in the Charter of the United Nations and the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe, and their commitment to promote these principles in their bilateral and multilateral relations. The Parties also underline their full support for the principle of host nation consent on stationing foreign armed forces on their territories. They agree that the stationing of foreign armed forces on their territory should take place with the explicit consent of the host state, in accordance with international law.

Article 6

Serious crimes of international concern

1. The Parties reaffirm that the most serious crimes of concern to the international community as a whole must not go unpunished and that impunity for such crimes must be avoided by taking measures at national and international level including the International Criminal Court.

2. The Parties consider that the establishment and effective functioning of the International Criminal Court constitutes an important development for international peace and justice. The Parties reaffirm their commitment to continue to cooperate with the International Criminal Court by implementing the Rome Statute of the International Criminal Court and its related instruments, giving due regard to preserving its integrity.

Article 7

Conflict prevention and crisis management

The Parties shall enhance practical cooperation in conflict prevention and crisis management, in particular with a view to possible participation of Georgia in EU-led civilian and military crisis management operations as well as relevant exercises and training, on a case-by-case basis and following possible invitation by the EU.

Article 8

Regional stability

1. The Parties shall intensify their joint efforts to promote stability, security and democratic development in the region, as well as to work to further promote regional cooperation in various formats and, in particular, shall work towards peaceful settlement of the unresolved conflicts in the region.

2. These efforts shall follow commonly shared principles of maintaining international peace and security as established by the Charter of the United Nations, the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe and other relevant multilateral documents. The Parties shall also make full use of the multilateral framework of the Eastern Partnership that provides for cooperation activities and open and free dialogue, fostering links among partners countries themselves.

Article 9

Peaceful conflict resolution

1. The Parties reiterate their commitment to peaceful conflict resolution in full respect of the sovereignty and territorial integrity of Georgia within its internationally recognised borders as well as to facilitating jointly post-conflict rehabilitation and reconciliation efforts. Pending sustainable solution to conflict and without prejudice to the existing formats for addressing conflict-related issues, peaceful conflict resolution will constitute one of the central subjects on the agenda of political dialogue between the Parties, as well as in the dialogue with other relevant international actors.

2. The Parties recognise the importance of the commitment of Georgia to reconciliation and its efforts to restore its territorial integrity in pursuit of a peaceful and lasting conflict resolution, of pursuing the full implementation of the Six-Point Agreement of 12 August 2008 and its subsequent implementing measures, of pursuing mutually supportive non-recognition and engagement policies, of supporting the Geneva International Discussions and of safe and dignified return of all internally displaced persons and refugees to their habitual places of residence in line with principles of international law; and of a meaningful international field involvement, including, as appropriate, that of the EU.

3. The Parties shall coordinate, also with other relevant international organisations, their efforts to contribute to peaceful conflict resolution in Georgia, including in relation to humanitarian issues.

4. All these efforts shall follow commonly shared principles of maintaining international peace and security as established by the Charter of the United Nations, the Helsinki Final Act of 1975 of the Conference on Security and Cooperation in Europe and other relevant multilateral documents.

Article 10

Weapons of mass destruction

1. The Parties consider that the proliferation of weapons of mass destruction (WMD) and their means of delivery, both to state and non-state actors, represents one of the most serious threats to international peace and stability. The Parties therefore agree to cooperate and to contribute to countering the proliferation of WMD and their means of delivery through full compliance with, and national implementation of, their existing obligations under international disarmament and non-proliferation treaties and agreements, and other relevant international obligations. The Parties agree that this provision constitutes an essential element of this Agreement.

2. The Parties furthermore agree to cooperate and to contribute to countering the proliferation of WMD and their means of delivery by:

(a)	taking steps to sign, ratify, or accede to, as appropriate, and fully implement, all other relevant international instruments; and

(b)	establishing an effective system of national export controls, controlling the export as well as transit of WMD-related goods, including a WMD end-use control on dual-use technologies, and containing effective sanctions for breaches of export controls.

3. The Parties agree to address these issues in their political dialogue.

Article 11

Small arms and light weapons and conventional arms exports control

1. The Parties recognise that the illicit manufacture, transfer and circulation of small arms and light weapons (SALW), including their ammunition, and their excessive accumulation, poor management, inadequately secured stockpiles and uncontrolled spread continue to pose a serious threat to peace and international security.

2. The Parties agree to observe and fully implement their respective obligations to deal with the illicit trade in SALW, including their ammunition, under existing international agreements and UN Security Council resolutions, as well as their commitments within the framework of other international instruments applicable in this area, such as the United Nations Programme of Action to prevent, combat and eradicate the illicit trade in SALW in all its aspects.

3. The Parties shall undertake to cooperate and to ensure coordination, complementarity and synergy in their efforts to deal with the illicit trade in SALW, including their ammunition, and the destruction of excessive stockpiles, at global, regional, sub-regional and national levels.

4. Furthermore, the Parties agree to continue to cooperate in the area of conventional arms export control, in the light of the Council Common Position 2008/944/CFSP of 8 December 2008 defining common rules governing control of exports of military technology and equipment.

5. The Parties agree to address these issues in their political dialogue.

Article 12

Fight against terrorism

1. The Parties reaffirm the importance of the fight against and the prevention of terrorism and agree to work together at bilateral, regional and international level to prevent and combat terrorism in all its forms and manifestations.

2. The Parties agree that the fight against terrorism must be conducted with full respect for the rule of law and in full conformity with international law including international human rights law, international refugee law and international humanitarian law, the principles of the Charter of the United Nations, and all relevant international counter-terrorism related instruments.

3. The Parties stress the importance of the universal ratification and full implementation of all UN counter-terrorism related conventions and protocols. The Parties agree to continue to promote dialogue on the draft Comprehensive Convention on International Terrorism and to cooperate in the implementation of the United Nations Global Counter-Terrorism Strategy, as well as all relevant UN Security Council resolutions and Council of Europe conventions. The Parties also agree to cooperate to promote international consensus on the prevention of and fight against terrorism.

TITLE III

FREEDOM, SECURITY AND JUSTICE

Article 13

Rule of law and respect for human rights and fundamental freedoms

1. In their cooperation in the area of freedom, security and justice the Parties shall attach particular importance to further promoting the rule of law, including the independence of the judiciary, access to justice, and the right to a fair trial.

2. The Parties will cooperate fully on the effective functioning of institutions in the areas of law enforcement and the administration of justice.

3. Respect for human rights and fundamental freedoms will guide all cooperation on freedom, security and justice.

Article 14

Protection of personal data

The Parties agree to cooperate in order to ensure a high level of protection of personal data in accordance with the EU, Council of Europe and international legal instruments and standards referred to in Annex I to this Agreement.

Article 15

Cooperation on migration, asylum and border management

1. The Parties reaffirm the importance of a joint management of migration flows between their territories and shall establish a comprehensive dialogue on all migration-related issues, including legal migration, international protection and the fight against illegal migration, smuggling and trafficking in human beings.

2. Cooperation will be based on specific needs assessments conducted in mutual consultation between the Parties and be implemented in accordance with their relevant legislation in force. It will, in particular, focus on:

(a)	the root causes and the consequences of migration;

(b)

the development and implementation of national legislation and practices as regards international protection, with a view to satisfying the provisions of the Geneva Convention relating to the Status of Refugees of 1951 and of the Protocol relating to the Status of Refugees of 1967 and of other relevant international instruments, such as the European Convention on the Protection of Human Rights and Fundamental Freedoms of 1950, and to ensuring the respect of the principle of ‘non-refoulement’;

(c)	the admission rules and rights and status of persons admitted, fair treatment and integration of lawfully residing non-nationals education and training and measures against racism and xenophobia;

(d)	the enhancement of an effective and preventive policy against illegal migration, smuggling of migrants and trafficking in human beings including the issue of how to combat networks of smugglers and traffickers and how to protect the victims of such trafficking;

(e)

the implementation of the Working Arrangement on the establishment of operational cooperation between the European Agency for the Management of Operational Cooperation at the External Borders of the Member States of the European Union (FRONTEX) and the Ministry of Internal Affairs (MIA) of Georgia, signed on 4 December 2008;

(f)	in the areas of document security and border management, issues such as organisation, training, best practices and other operational measures.

3. Cooperation may also facilitate circular migration for the benefit of development.

Article 16

Movement of persons and readmission

1. The Parties will ensure the full implementation of:

(a)	the Agreement between the European Union and Georgia on the readmission of persons residing without authorisation, which entered into force on 1 March 2011; and

(b)	the Agreement between the European Union and Georgia on the facilitation of the issuance of visas, which entered into force on 1 March 2011.

2. The Parties shall continue to endeavour to enhance mobility of citizens and shall take gradual steps towards the shared objective of a visa-free regime in due course, provided that the conditions for well-managed and secure mobility set out in the two-phase Action Plan on Visa Liberalisation are in place.

Article 17

The fight against organised crime and corruption

1. The Parties shall cooperate on combating and preventing criminal and illegal activities, in particular transnational activities, organised or otherwise, such as:

(a)	smuggling and trafficking in human beings as well as small arms and illicit drugs;

(b)	smuggling and trafficking in goods;

(c)	illegal economic and financial activities such as counterfeiting, fiscal fraud and public procurement fraud;

(d)	embezzlement in projects funded by international donors;

(e)	active and passive corruption, both in the private and public sector;

(f)	forging documents, submitting false statements; and

(g)	cybercrime.

2. The Parties shall enhance bilateral, regional and international cooperation among law enforcement bodies including developing cooperation between Europol and the relevant authorities of Georgia. The Parties are committed to implementing effectively the relevant international standards, and in particular those enshrined in the United Nations Convention against Transnational Organised Crime (UNTOC) of 2000 and the three Protocols thereto and in the United Nations Convention against Corruption of 2003.

Article 18

Illicit drugs

1. Within their respective powers and competencies, the Parties shall cooperate to ensure a balanced and integrated approach towards drug issues. Drug policies and actions shall be aimed at reinforcing structures for preventing and combating illicit drugs, reducing the supply of, trafficking in and the demand for illicit drugs, addressing the health and social consequences of drug abuse with a view to reducing harm as well as at a more effective prevention of diversion of chemical precursors used for the illicit manufacture of narcotic drugs and psychotropic substances.

2. The Parties shall agree on the necessary methods of cooperation to attain these objectives. Actions shall be based on commonly agreed principles along the lines of the relevant international conventions, and the EU Drug Strategy (2013-20), the Political Declaration on the guiding principles of drug demand reduction, approved by the Twentieth United Nations General Assembly Special Session on Drugs in June 1998.

Article 19

Money laundering and terrorism financing

1. The Parties shall cooperate in order to prevent the use of their financial and relevant non-financial systems to launder the proceeds of criminal activities in general and drug offences in particular, as well as for the purpose of terrorism financing.

This cooperation extends to the recovery of assets or funds derived from the proceeds of crime.

2. Cooperation in this area shall allow exchanges of relevant information within the framework of respective legislation and the adoption of appropriate standards to prevent and combat money laundering and financing of terrorism equivalent to those adopted by relevant international bodies active in this area, such as the Financial Action Task Force on Money Laundering (FATF).

Article 20

Cooperation in the fight against terrorism

1. In full accordance with the principles underlying the fight against terrorism as set out in Article 12 of this Agreement, the Parties reaffirm the importance of a law enforcement and judicial approach to the fight against terrorism and agree to cooperate in the prevention and suppression of terrorism in particular by:

(a)	ensuring the criminalisation of terrorist offences, in line with the definition contained in the Council Framework Decision 2008/919/JHA of 28 November 2008 amending Framework Decision 2002/475/JHA on combatting terrorism;

(b)	exchanging information on terrorist groups and individuals and their support networks, in accordance with international and national law, in particular as regards data protection and the protection of privacy;

(c)	exchanging experience in the prevention and suppression of terrorism, means and methods and their technical aspects, as well as on training, in accordance with applicable law;

(d)	sharing information on best practices in addressing and countering radicalisation and recruitment, and on promoting rehabilitation;

(e)	exchanging views and experience concerning cross-border movement and travel of terrorist suspects as well as concerning terrorist threats;

(f)	sharing best practices as regards the protection of human rights in the fight against terrorism, in particular in relation to criminal justice proceedings;

(g)

taking measures against the threat of chemical, biological, radiological and nuclear terrorism and undertaking the measures necessary to prevent the acquisition, transfer and use for terrorist purposes of chemical, biological, radiological and nuclear materials as well as to prevent illegal acts against high risk chemical, biological, radiological and nuclear facilities.

2. Cooperation shall be based on relevant available assessments, such as those of the relevant bodies of the UN and the Council of Europe and conducted in mutual consultation between the Parties.

Article 21

Legal cooperation

1. The Parties agree to develop judicial cooperation in civil and commercial matters as regards the negotiation, ratification and implementation of multilateral conventions on civil judicial cooperation and, in particular, the conventions of the Hague Conference on Private International Law in the field of international legal cooperation and litigation as well as the protection of children.

2. As regards judicial cooperation in criminal matters, the Parties will seek to enhance cooperation on mutual legal assistance on the basis of relevant multilateral agreements. This would include, where appropriate, accession to, and implementation of, the relevant international instruments of the UN and the Council of Europe and closer cooperation with Eurojust.

TITLE IV

TRADE AND TRADE-RELATED MATTERS

CHAPTER 1

National Treatment and Market Access For Goods

Section 1

Common Provisions

Article 22

Objective

The Parties shall establish a free trade area starting from the entry into force of this Agreement, in accordance with the provisions of this Agreement and in conformity with Article XXIV of the General Agreement on Tariffs and Trade 1994 (GATT 1994).

Article 23

Scope and coverage

1. The provisions of this Chapter shall apply to trade in goods (1) between the Parties.

2. For the purposes of this Chapter, ‘originating’ means qualifying under the rules of origin set out in Protocol I to this Agreement.

Section 2

Elimination of customs duties, fees and other charges

Article 24

Definition of customs duties

For the purposes of this Chapter, a ‘customs duty’ includes any duty or charge of any kind imposed on, or in connection with, the import or export of a good, including any form of surtax or surcharge imposed on or in connection with such import or export. A ‘customs duty’ does not include any:

(a)	charge equivalent to an internal tax imposed consistently with Article 31 of this Agreement;

(b)	duties imposed consistently with Chapter 2 (Trade Remedies) of Title IV (Trade and Trade-related Matters) of this Agreement;

(c)	fees or other charges imposed consistently with Article 30 of this Agreement.

Article 25

Classification of goods

The classification of goods in trade between the Parties shall be that set out in each Party's respective tariff nomenclature in conformity with the 2012 Harmonised System based on the International Convention on the Harmonised Commodity Description and Coding System of 1983 (HS) and subsequent amendments thereto.

Article 26

Elimination of customs duties on imports

1. The Parties shall eliminate all customs duties on goods originating in the other Party as from the date of entry into force of this Agreement except as provided in paragraphs 2 and 3 of this Article and without prejudice to paragraph 4 of this Article.

2. The products listed in Annex II-A to this Agreement shall be imported into the Union free of customs duties within the limits of the tariff rate quotas set out in that Annex. The most-favoured-nation (MFN) customs duty rate shall apply to imports exceeding the tariff rate quota limit.

3. The products listed in Annex II-B to this Agreement shall be subject to an import duty when imported into the Union with exemption of the ad valorem component of that import duty.

4. The import of products originating in Georgia listed in Annex II-C to this Agreement shall be subject to the anti-circumvention mechanism set out in Article 27 of this Agreement.

5. After five years from the entry into force of this Agreement, at the request of either Party, the Parties shall consult to consider broadening the scope of the liberalisation of customs duties in the trade between the Parties. A decision under this paragraph shall be made by the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

Article 27

Anti-circumvention mechanism for agricultural products and processed agricultural products

1. The products listed in Annex II-C to this Agreement are subject to the anti-circumvention mechanism set out in this Article. The average annual volume of imports from Georgia into the Union for each category of those products is provided in Annex II-C to this Agreement.

2. When the volume of imports of one or more categories of products referred to in paragraph 1 reaches 70 % of the volume indicated in Annex II-C to this Agreement in any given year starting on 1 January, the Union shall notify Georgia about the volume of imports of the products(s) concerned. Following this notification and within 14 calendar days from the date on which the volume of imports of one or more categories of products referred to in paragraph 1 reaches 80 % of the volume indicated in Annex II-C to this Agreement, Georgia shall provide the Union with a sound justification that Georgia has the capacity to produce the products for export into the Union in excess of the volumes set out in that Annex. If those imports reach 100 % of the volume indicated in Annex II-C to this Agreement, and in the absence of a sound justification by Georgia, the Union may temporarily suspend the preferential treatment for the products concerned.

The suspension shall be applicable for a period of six months and shall take effect on the date of publication of the decision to suspend preferential treatment in the Official Journal of the European Union.

3. All temporary suspensions adopted pursuant to paragraph 2 shall be notified by the Union to Georgia without undue delay.

4. A temporary suspension shall be lifted before the expiry of six months from its entry into force by the Union if Georgia provides robust and satisfactory evidence within the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, that the volume of the relevant category of products imported in excess of the volume referred to in Annex II-C to this Agreement results from a change in the level of production and export capacity of Georgia for the product(s) concerned.

5. Annex II-C to this Agreement may be amended and the volume modified by mutual consent of the Union and Georgia in the Association Committee in Trade configuration at the request of Georgia, in order to reflect changes in the level of production and export capacity of Georgia for the product(s) concerned.

Article 28

Standstill

Neither Party may adopt any new customs duty, on a good originating in the other Party or may increase any customs duty applied on the date of entry into force of this Agreement. This shall not preclude that either Party may maintain or increase a customs duty as authorised by the Dispute Settlement Body (DSB) of the WTO.

Article 29

Customs duties on exports

Neither Party shall adopt or maintain any customs duty or tax, other than internal charges applied in conformity with Article 30 of this Agreement, on, or in connection with, the export of goods to the territory of the other Party.

Article 30

Fees and other charges

Each Party shall ensure, in accordance with Article VIII of GATT 1994 and the interpretative notes thereon, that all fees and charges of whatever character other than customs duties or other measures referred to in Article 26 of this Agreement, imposed on, or in connection with, the import or export of goods are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to domestic goods or a taxation of imports or exports for fiscal purposes.

Section 3

Non-tariff measures

Article 31

National treatment

Each Party shall accord national treatment to the goods of the other Party in accordance with Article III of GATT 1994, including the interpretative notes thereon. To that end, Article III of GATT 1994 and the interpretative notes thereon are incorporated into this Agreement and made an integral part thereof.

Article 32

Import and export restrictions

Neither Party shall adopt or maintain any prohibition or restriction on the import of any good of the other Party or on the export or sale for export of any good destined for the territory of the other Party, except as otherwise provided in this Agreement or in accordance with Article XI of GATT 1994 and the interpretative notes thereon. To that end, Article XI of GATT 1994 and the interpretative notes thereon are incorporated into this Agreement and made an integral part thereof.

Section 4

Specific provisions related to goods

Article 33

General exceptions

Nothing in this Chapter shall be construed to prevent the adoption or enforcement by any Party of measures in accordance with Articles XX and XXI of GATT 1994 and any relevant interpretative notes to those Articles under GATT 1994, which are hereby incorporated into this Agreement and made an integral part thereof.

Section 5

Administrative cooperation and coordination with other countries

Article 34

Temporary withdrawal of preferences

1. The Parties agree that administrative cooperation and assistance is essential for the implementation and the control of preferential tariff treatment granted under this Chapter and underline their commitment to combat irregularities and fraud in customs and related matters.

2. Where a Party has made a finding, on the basis of objective information, of a failure of the other Party to provide administrative cooperation or assistance and/or of irregularities or fraud under this Chapter, the Party concerned may temporarily suspend the relevant preferential treatment of the product(s) concerned in accordance with this Article.

3. For the purposes of this Article, a failure to provide administrative cooperation or assistance shall mean, inter alia:

(a)	a repeated failure to respect the obligations to verify the originating status of the good(s) concerned;

(b)	a repeated refusal or undue delay in carrying out and/or communicating the results of subsequent verification of the proof of origin;

(c)	a repeated refusal or undue delay in obtaining authorisation to conduct enquiry visits to determine the authenticity of documents or accuracy of information relevant to the granting of the preferential treatment in question.

4. For the purposes of this Article, a finding of irregularities or fraud may be made, inter alia, where there is a rapid increase, without satisfactory explanation, in the volume of imports of goods exceeding the usual level of production and export capacity of the other Party that is linked to objective information concerning irregularities or fraud.

5. The application of a temporary suspension shall be subject to the following conditions:

(a)

the Party which has made a finding, on the basis of objective information, of a failure to provide administrative cooperation or assistance and/or of irregularities or fraud from the other Party, shall without undue delay notify the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, of its finding together with the objective information and enter into consultations within that Committee, on the basis of all relevant information and objective findings, with a view to reaching a solution acceptable to both Parties;

(b)

where the Parties have entered into consultations within the Association Committee in Trade configuration and have failed to agree on an acceptable solution within three months following the notification, the Party concerned may temporarily suspend the relevant preferential treatment of the good(s) concerned. A temporary suspension shall be notified to the Association Committee in Trade configuration without undue delay;

(c)

temporary suspensions under this Article shall be limited to that necessary to protect the financial interests of the Party concerned. They shall not exceed a period of six months, which may be renewed, if at the date of expiry nothing has changed with respect to the condition that gave rise to the initial suspension. They shall be subject to periodic consultations within the Association Committee in Trade configuration, in particular with a view to their termination as soon as the conditions for their application no longer apply.

6. Each Party shall publish in accordance with its internal procedures, notices to importers concerning any: notification referred to in paragraph 5(a); decision referred to in paragraph 5(b); and extension or termination referred to in paragraph 5(c).

Article 35

Management of administrative errors

In case of an error by the competent authorities in the proper management of the preferential system at export, and in particular in the application of the provisions of Protocol I to this Agreement concerning the definition of originating products and methods of administrative cooperation, where this error leads to consequences in terms of import duties, the Party facing such consequences may request the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, to examine the possibilities of adopting all appropriate measures with a view to resolving the situation.

Article 36

Agreements with other countries

1. This Agreement shall not preclude the maintenance or establishment of customs unions, free trade areas or arrangements for frontier traffic except in so far as they conflict with trade arrangements provided for in this Agreement.

2. Consultations between the Parties shall take place within the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, at the request of either Party, concerning agreements establishing customs unions, free trade areas or arrangements for frontier traffic and on other major issues related to their respective trade policy with third countries. In particular in the event of a third country acceding to the EU, such consultations shall take place so as to ensure that account be taken of the mutual interests of the Union and Georgia as stated in this Agreement.

CHAPTER 2

Trade remedies

Section 1

Global safeguard measures

Article 37

General provisions

1. The Parties confirm their rights and obligations under Article XIX of GATT 1994 and the Agreement on Safeguards contained in Annex 1A to the WTO Agreement (‘Agreement on Safeguards’) and Article 5 of the Agreement on Agriculture, contained in Annex 1A to the WTO Agreement (‘Agreement on Agriculture’).

2. The preferential rules of origin established under Chapter 1 (National Treatment and Market Access for Goods) of Title IV (Trade and Trade-related Matters) of this Agreement shall not apply to this Section.

3. The provisions of this Section shall not be subject to Chapter 14 (Dispute Settlement) of Title IV (Trade and Trade-related Matters) of this Agreement.

Article 38

Transparency

1. The Party initiating a safeguard investigation shall notify the other Party of such initiation provided the latter has a substantial economic interest.

2. Notwithstanding Article 37 of this Agreement, at the request of the other Party, the Party initiating a safeguard investigation and intending to apply safeguard measures shall provide immediately ad hoc written notification of all the pertinent information leading to the initiation of a safeguard investigation and the imposition of safeguard measures, including, where relevant, information on the initiation of a safeguard investigation, on the provisional findings and on the final findings of the investigation, as well as offer the possibility for consultations to the other Party.

3. For the purposes of this Article, a Party shall be considered as having a substantial economic interest when it is among the five largest suppliers of the imported product during the most recent three-year period of time, measured in terms of either absolute volume or value.

Article 39

Application of measures

1. When imposing safeguard measures, the Parties shall endeavour to impose them in a way that affects their bilateral trade the least.

2. For the purposes of paragraph 1 of this Article, if a Party considers that the legal requirements for the imposition of definitive safeguard measures are met and intends to apply such measures, that Party shall notify the other Party and give the latter the possibility to hold bilateral consultations. If no satisfactory solution has been reached within 30 days of the notification, the importing Party may adopt the appropriate measures to remedy the problem.

Section 2

Anti-dumping and countervailing measures

Article 40

General provisions

1. The Parties confirm their rights and obligations under Article VI of GATT 1994, the Agreement on Implementation of Article VI of GATT 1994, contained in Annex 1A to the WTO Agreement (‘Anti-Dumping Agreement’) and the Agreement on Subsidies and Countervailing Measures, contained in Annex 1A to the WTO Agreement (‘SCM Agreement’).

3. The provisions of this Section shall not be subject to Chapter 14 (Dispute Settlement) of Title IV (Trade and Trade-related Matters) of this Agreement.

Article 41

Transparency

1. The Parties agree that anti-dumping and countervailing measures should be used in full compliance with the requirements of the Anti-Dumping Agreement and the SCM Agreement, respectively, and should be based on a fair and transparent system.

2. The Parties shall ensure, immediately after the imposition of provisional measures and before the final determination is made, full and meaningful disclosure of all essential facts and considerations which form the basis for the decision to apply measures, without prejudice to Article 6.5 of the Anti-Dumping Agreement and Article 12.4 of the SCM Agreement. Disclosures shall be made in writing and allow interested parties sufficient time to make their comments.

3. Provided it does not unnecessarily delay the conduct of the investigation, each interested Party shall be granted the possibility to be heard in order to express their views during anti-dumping and anti-subsidy investigations.

Article 42

Consideration of public interest

Anti-dumping or countervailing measures may not be applied by a Party where, on the basis of the information made available during the investigation, it can clearly be concluded that it is not in the public interest to apply such measures. The public interest determination shall be based on an appreciation of all the various interests taken as a whole, including the interests of the domestic industry, users, consumers and importers to the extent that they have provided relevant information to the investigating authorities.

Article 43

Lesser duty rule

Should a Party decide to impose a provisional or a definitive anti-dumping or a countervailing duty, the amount of such duty shall not exceed the margin of dumping or the total amount of countervailable subsidies, but it should be less than the margin of dumping or the total amount of countervailable subsidies if such a lesser duty would be adequate to remove the injury to the domestic industry.

CHAPTER 3

Technical barriers to trade, standardisation, metrology, accreditation and conformity assessment

Article 44

Scope and definitions

1. This Chapter applies to the preparation, adoption and application of standards, technical regulations, and conformity assessment procedures as defined in the Agreement on Technical Barriers to Trade, contained in Annex 1A to the WTO Agreement (‘TBT Agreement’) that may affect trade in goods between the Parties.

2. Notwithstanding paragraph 1, this Chapter does not apply to sanitary and phytosanitary measures as defined in Annex A to the Agreement on the Application of Sanitary and Phytosanitary Measures, contained in Annex 1A to the WTO Agreement (‘SPS Agreement’), nor to purchasing specifications prepared by public authorities for their own production or consumption requirements.

3. For the purposes of this Chapter, the definitions of Annex I to the TBT Agreement shall apply.

Article 45

Affirmation of the TBT Agreement

The Parties affirm their existing rights and obligations with respect to each other under the TBT Agreement which is hereby incorporated into this Agreement and made an integral part thereof.

Article 46

Technical cooperation

1. The Parties shall strengthen their cooperation in the field of standards, technical regulations, metrology, market surveillance, accreditation and conformity assessment systems with a view to increasing the mutual understanding of their respective systems and facilitating access to their respective markets. To that end, they may establish regulatory dialogues at both horizontal and sectoral levels.

2. In their cooperation, the Parties shall seek to identify, develop and promote trade facilitating initiatives which may include, but are not limited to:

(a)

reinforcing regulatory cooperation through the exchange of data and experience, and through scientific and technical cooperation, with a view to improving the quality of their technical regulations, standards, market surveillance, conformity assessment and accreditation, and making efficient use of regulatory resources;

(b)	promoting and encouraging cooperation between their respective organisations, public or private, responsible for metrology, standardisation, market surveillance, conformity assessment and accreditation;

(c)	fostering the development of the quality infrastructure for standardisation, metrology, accreditation, conformity assessment and the market surveillance system in Georgia;

(d)	promoting the participation of Georgia in the work of related European organisations;

(e)	seeking solutions to technical barriers to trade that may arise; and

(f)	where appropriate, undertaking efforts to coordinate their positions on matters of mutual interest in international trade and regulatory organisations such as the WTO and the United Nations Economic Commission for Europe (UNECE).

Article 47

Approximation of technical regulations, standards, and conformity assessment

1. Having regard to its priorities for approximation in different sectors, Georgia shall take the measures necessary in order to gradually achieve approximation with the Union's technical regulations, standards, metrology, accreditation, conformity assessment, corresponding systems and market surveillance system, and undertakes to follow the principles and the practice laid down in the relevant Union acquis (indicative list in Annex III-B to this Agreement). A list of the measures for approximation is set out in Annex III-A to this Agreement, which may be amended by a decision of the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

2. With a view to reaching these objectives, Georgia shall:

(a)	having regard to its priorities, progressively approximate its legislation to the relevant Union acquis; and

(b)	achieve and maintain the level of administrative and institutional effectiveness necessary to provide an effective and transparent system that is required for the implementation of this Chapter.

3. Georgia shall refrain from amending its horizontal and sectoral legislation in the priority areas for approximation, except for approximating such legislation progressively to the corresponding Union acquis and for maintaining such approximation; and shall notify the Union of such changes in its domestic legislation.

4. Georgia shall ensure and facilitate the participation of its relevant national bodies in the European and international organisations for standardisation, legal and fundamental metrology, and conformity assessment, including accreditation, in accordance with the respective areas of activity of those bodies and the membership status available to them.

5. With a view to integrating its standardisation system, Georgia shall use best endeavours to ensure that its standards body:

(a)	progressively transposes the corpus of European standards (EN) as national standards, including the harmonised European standards, the voluntary use of which shall give presumption of conformity with Union legislation transposed into Georgian legislation;

(b)	simultaneously with such transposition, withdraws conflicting national standards;

(c)	progressively fulfils the other conditions for full membership of the European standards organisations.

Article 48

Agreement on Conformity Assessment and Acceptance of Industrial Products (ACAA)

The Parties may ultimately agree to add an Agreement on Conformity Assessment and Acceptance of Industrial Products (ACAA) as a Protocol to this Agreement covering one or more sectors agreed upon following verification by the Union that the relevant Georgian horizontal and sectoral legislation, institutions and standards have been fully approximated to those of the Union. Such an ACAA will provide that trade between the Parties in products in the sectors that it covers shall take place under the same conditions as those applying to trade in such products between the Member States.

Article 49

Marking and labelling

1. Without prejudice to the provisions of Articles 47 and 48 of this Agreement, and with respect to technical regulations relating to labelling or marking requirements, the Parties reaffirm the principles of Chapter 2.2 of the TBT Agreement that such requirements are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, such labelling or marking requirements shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks that non-fulfilment would create.

2. Regarding obligatory marking or labelling in particular, the Parties agree that:

(a)	they will endeavour to minimise their needs for marking or labelling, except as required for the adoption of the Union acquis in this area and for the protection of health, safety or the environment, or for other reasonable public policy purposes;

(b)	a Party may determine the form of labelling or marking but shall not require the approval, the registration or the certification of labels; and

(c)	the Parties retain the right to require the information on the label or marking to be in a specified language.

CHAPTER 4

Sanitary and phytosanitary measures

Article 50

Objective

1. The objective of this Chapter is to facilitate trade in commodities covered by sanitary and phytosanitary measures (SPS measures), including all measures listed in Annex IV to this Agreement, between the Parties, whilst safeguarding human, animal or plant life or health, by:

(a)	ensuring full transparency as regards measures applicable to trade, listed in Annex IV to this Agreement;

(b)	approximating the Georgian regulatory system to that of the Union;

(c)	recognising the animal and plant health status of the Parties and applying the principle of regionalisation;

(d)	establishing a mechanism for the recognition of equivalence of measures maintained by a Party, listed in Annex IV to this Agreement;

(e)	continuing to implement the SPS Agreement;

(f)	establishing mechanisms and procedures for trade facilitation; and

(g)	improving communication and cooperation between the Parties on measures listed in Annex IV to this Agreement.

2. This Chapter also aims at reaching a common understanding between the Parties concerning animal welfare standards.

Article 51

Multilateral obligations

The Parties re-affirm their rights and obligations under the WTO Agreements, and in particular the SPS Agreement.

Article 52

Scope

This Chapter shall apply to all sanitary and phytosanitary measures of a Party that may, directly or indirectly, affect trade between the Parties, including all measures listed in Annex IV to this Agreement. This scope is without prejudice to the scope of approximation as set out in Article 55 of this Agreement.

Article 53

Definitions

For the purposes of this Chapter, the following definitions shall apply:

(1)	‘sanitary and phytosanitary measures’ means measures as defined in paragraph 1 of Annex A to the SPS Agreement (SPS measures);

(2)	‘animals’ means animals as defined in the Terrestrial Animal Health Code or the Aquatic Animal Health Code of the World Organisation for Animal Health (OIE), respectively;

(3)	‘animal products’ means products of animal origin, including aquatic animal products as defined in the Aquatic Animal Health Code of the OIE;

(4)	‘animal by-products not intended for human consumption’ means entire bodies or parts of animals, products of animal origin or other products obtained from animals that are not intended for human consumption as listed in Part 2(II) of Annex IV-A to this Agreement;

(5)

‘plants’ means living plants and specified living parts thereof, including seeds and germplasm:

(a)	fruits, in the botanical sense, other than those preserved by deep freezing;

(b)	vegetables, other than those preserved by deep freezing;

(c)	tubers, corms, bulbs, rhizomes;

(d)	cut flowers;

(e)	branches with foliage;

(f)	cut trees retaining foliage;

(g)	plant tissue cultures;

(h)	leaves, foliage;

(i)	live pollen; and

(j)	bud-wood, cuttings, scions.

(6)	‘plant products’ means products of plant origin, unprocessed or having undergone simple preparation in so far as these are not plants, set out in Part 3 of Annex IV-A to this Agreement;

(7)	‘seeds’ means seeds in the botanical sense, intended for planting;

(8)	‘pests’ means any species, strain or biotype of plant, animal or pathogenic agent injurious to plants or plant products (harmful organisms);

(9)

‘protected zones’ means zones within the meaning of Article 2(1)(h) of Council Directive 2000/29/EC of 8 May 2000 on protective measures against the introduction into the Community of organisms harmful to plants or plant products and against their spread within the Community, or any successor provision;

(10)	‘animal disease’ means a clinical or pathological manifestation in animals of an infection;

(11)	‘aquaculture disease’ means clinical or non-clinical infection with one or more of the aetiological agents of the diseases referred to in the Aquatic Animal Health Code of the OIE;

(12)	‘infection in animals’ means the situation where animals maintain an infectious agent with or without presence of clinical or pathological manifestation of an infection;

(13)	‘animal welfare standards’ means standards for the protection of animals developed and applied by the Parties and, as appropriate, in line with the OIE standards;

(14)	‘appropriate level of sanitary and phytosanitary protection’ means the appropriate level of sanitary and phytosanitary protection as defined in paragraph 5 of Annex A to the SPS Agreement;

(15)

‘region’ means with regard to animal health a zone or a region as defined in the Terrestrial Animal Health Code of the OIE, and with regard to aquaculture a zone as defined in the Aquatic Animal Health Code of the OIE. For the Union the term ‘territory’ or ‘country’ shall mean the territory of the Union;

(16)	‘pest free area (PFA)’ means an area in which a specific pest does not occur as demonstrated by scientific evidence and in which, where appropriate, this condition is being officially maintained;

(17)	‘regionalisation’ means the concept of regionalisation as described in Article 6 of the SPS Agreement;

(18)

‘consignment of animals or animal products’ means a number of animals or a quantity of animal products of the same type, covered by the same certificate or document, conveyed by the same means of transport, consigned by a single consignor and originating in the same exporting Party or region(s) of the Party. A consignment of animals may be composed of one or more commodities or lots;

(19)	‘consignment of plants or plant products’ means a quantity of plants, plant products and/or other objects being moved from a Party to another Party and covered, when required, by a single phytosanitary certificate. A consignment may be composed of one or more commodities or lots;

(20)	‘lot’ means a number or units of a single commodity, identifiable by its homogeneity of composition and origin, and forming part of a consignment;

(21)

‘equivalence for trade purposes’ (equivalence) means that the measures listed in Annex IV to this Agreement applied in the exporting Party, whether or not different from the measures listed in that Annex applied in the importing Party, objectively achieve the importing Party's appropriate level of protection or acceptable level of risk;

(22)	‘sector’ means the production and trade structure for a product or category of products in a Party;

(23)	‘sub-sector’ means a well-defined and controlled part of a sector;

(24)	‘commodity’ means the products or objects referred to in points 2 to 7;

(25)	‘specific import permit’ means a formal prior authorisation by the competent authorities of the importing Party addressed to an individual importer as a condition for import of a single consignment or multiple consignments of a commodity from the exporting Party, within the scope of this Chapter;

(26)	‘working days’ means weekdays except Sunday, Saturday and public holidays in one of the Parties;

(27)	‘inspection’ means the examination of any aspect of feed, food, animal health and animal welfare in order to verify that such aspect(s) comply with the legal requirements of feed and food law and animal health and animal welfare rules;

(28)	‘plant health inspection’ means official visual examination of plants, plant products or other regulated objects to determine if pests are present and/or to determine compliance with phytosanitary regulations;

(29)	‘verification’ means checking, by examination and consideration of objective evidence, whether specified requirements have been fulfilled.

Article 54

Competent authorities

The Parties shall inform each other about the structure, organisation and division of competences of their competent authorities during the first meeting of the Sanitary and Phytosanitary Sub-Committee referred to in Article 65 of this Agreement (‘SPS Sub-Committee’). The Parties shall inform each other of any change of the structure, organisation and division of competences, including of the contact points, concerning such competent authorities.

Article 55

Gradual approximation

1. Georgia shall continue to gradually approximate its sanitary and phytosanitary, animal welfare and other legislative measures as laid down in Annex IV to this Agreement to that of the Union in accordance with the principles and procedure set out in Annex XI to this Agreement.

2. The Parties shall cooperate on gradual approximation and capacity building.

3. The SPS Sub-Committee shall regularly monitor the implementation of the approximation process set out in Annex XI to this Agreement in order to provide necessary recommendations on approximation.

4. No later than six months after the entry into force of this Agreement, Georgia shall submit a list of the EU sanitary and phytosanitary, animal welfare and other legislative measures as defined in Annex IV to this Agreement that Georgia will approximate. The list shall be divided into priority areas, in which trade in a specific commodity or a group of commodities will be facilitated by means of approximation. This approximation list shall serve as a reference document for the implementation of this Chapter.

Article 56

Recognition for trade purposes of animal health and pest status and regional conditions

1. As regards animal diseases and infections in animals (including zoonosis), the following shall apply:

(a)	the importing Party shall recognise for trade purposes the animal health status of the exporting Party or its regions determined in accordance with the procedure set out in Annex VI to this Agreement, with respect to animal diseases specified in Annex V-A to this Agreement;

(b)

where a Party considers that it has, for its territory or a region within its territory, a special status with respect to a specific animal disease other than a disease listed in Annex V-A to this Agreement, it may request recognition of this status in accordance with the procedure laid down in Annex VI Part C to this Agreement. In this regard, the importing Party may request guarantees, accompanied with an explanatory note, in respect of imports of live animals and animal products, which are appropriate to the agreed status of the Parties;

(c)

the Parties recognise as the basis for trade between them the status of the territories or the regions, or the status in a sector or a sub-sector of the Parties related to the prevalence or the incidence of an animal disease other than a disease listed in Annex V-A to this Agreement, or related to infections in animals and/or the associated risk, as appropriate, as determined by the OIE. In this regard, the importing Party may request guarantees, in respect of imports of live animals and animal products, which are appropriate to the defined status in accordance with the recommendations of OIE; and

(d)

without prejudice to Articles 58, 60 and 64 of this Agreement, and unless the importing Party raises an explicit objection and requests supporting or additional information, consultations and/or verification, each Party shall take without undue delay the necessary legislative and administrative measures to allow trade on the basis of the provisions of points (a), (b) and (c) of this paragraph.

2. As regards pests, the following shall apply:

(a)	the Parties recognise for trade purposes the pest status in respect of pests specified in Annex V-B to this Agreement as determined in Annex VI-B; and

(b)

3. The Parties recognise the concept of regionalisation and PFAs as specified in the relevant International Plant Protection Convention of 1997 (IPPC) and the International Standards for Phytosanitary Measures (ISPMs) of the Food and Agriculture Organisation (FAO), and of protected zones in accordance with Directive 2000/29/EC, which they agree to apply to trade between them.

4. The Parties agree that regionalisation decisions for animal and fish diseases listed in Annex V-A to this Agreement and for pests listed in Annex V-B to this Agreement shall be taken in accordance with the provisions of Part A and B of Annex VI to this Agreement.

5. As regards animal diseases in accordance with the provisions of Article 58 of this Agreement the exporting Party seeking recognition of its regionalisation decision by the importing Party shall notify its measures with full explanations and supporting data for its determinations and decisions. Without prejudice to Article 59 of this Agreement, and unless the importing Party raises an explicit objection and requests additional information, consultations and/or verification within 15 working days following receipt of the notification, the regionalisation decision so notified shall be deemed accepted.

The consultations referred to in the first subparagraph of this paragraph shall take place in accordance with Article 59(3) of this Agreement. The importing Party shall assess the additional information within 15 working days following receipt of the additional information. The verification referred to in the first subparagraph of this paragraph shall be carried out in accordance with Article 62 of this Agreement within 25 working days following receipt of the request for verification.

6. As regards pests, each Party shall ensure that trade in plants, plant products and other objects takes account, as appropriate, of the pest status in an area recognised as a protected zone or as a PFA by the other Party. A Party seeking recognition of its PFA by the other Party shall notify its measures and, upon request, provide full explanation and supporting data for its establishment and maintenance, as guided by appropriate FAO or IPPC standards, including ISPMs. Without prejudice to Article 64 of this Agreement, and unless a Party raises an explicit objection and requests additional information, consultations and/or verification within three months following the notification, the regionalisation decision for PFA so notified shall be deemed accepted; and

The consultations referred to in the first subparagraph of this paragraph shall take place in accordance with Article 59(3) of this Agreement. The importing Party shall assess the additional information within three months following the receipt of the additional information. The verification referred to in the first subparagraph of this paragraph shall be carried out in accordance with Article 62 of this Agreement within 12 months following the receipt of the request for verification, taking into account the biology of the pest and the crop concerned.

7. After finalisation of the procedures of paragraphs 4 to 6, and without prejudice to Article 64 of this Agreement, each Party shall take, without undue delay, the necessary legislative and administrative measures to allow trade on that basis.

8. The Parties may engage in further discussions with regard to the issue of compartmentalisation.

Article 57

Recognition of equivalence

1. Equivalence may be recognised in relation to:

(a)	an individual measure;

(b)	a group of measures; or

(c)	a system applicable to a sector, sub-sector, commodities or a group of commodities.

2. As regards recognition of equivalence the Parties shall follow the process set out in paragraph 3 of this Article. This process shall include an objective demonstration of equivalence by the exporting Party and an objective assessment of the request by the importing Party. This assessment may include inspections or verifications.

3. Upon request of the exporting Party concerning recognition of equivalence as set out in paragraph 1 of this Article the Parties shall without delay and no later than three months following the receipt of such a request by the importing Party, initiate the consultation process which includes the steps set out in Annex VIII to this Agreement. In case of multiple requests from the exporting Party, the Parties, upon request of the importing Party, shall agree within the SPS Sub-Committee referred to in Article 65 of this Agreement on a time schedule in which they shall initiate and conduct the process referred to in this paragraph.

4. Georgia shall notify the Union as soon as approximation is achieved in relation to a measure, a group of measures or a system as set out in paragraph 1 of this Article as a result of the monitoring provided for in Article 55(3) of this Agreement. This fact shall be considered as a basis for a request of Georgia to initiate the process of the recognition of equivalence of the measures concerned, as set out in paragraph 3 of this Article.

5. Unless otherwise agreed, the importing Party shall finalise the process for recognition of equivalence referred to in paragraph 3 of this Article within 360 days after the receipt of the request of the exporting Party, including a dossier demonstrating the equivalence. This time-limit may be extended with regard to seasonal crops when it is justifiable to delay the assessment to permit verification during a suitable period of growth of a crop.

6. The importing Party determines equivalence as regards plants, plant products and other objects in accordance with the relevant ISPMs.

7. The importing Party may withdraw or suspend equivalence on the basis of any amendment by one of the Parties of measures affecting equivalence, provided that the following procedure is followed:

(a)

in accordance with the provisions of Article 58(2) of this Agreement, the exporting Party shall inform the importing Party of any proposal for amendment of its measures for which equivalence of measures is recognised and the likely effect of the proposed measures on the equivalence which has been recognised. Within 30 working days following the receipt of this information, the importing Party shall inform the exporting Party whether or not equivalence would continue to be recognised on the basis of the proposed measures;

(b)

in accordance with the provisions of Article 58(2) of this Agreement, the importing Party shall promptly inform the exporting Party of any proposal for amendment of its measures on which recognition of equivalence has been based and the likely effect of the proposed measures on the equivalence which has been recognised. Should the importing Party not continue to recognise equivalence, the Parties may agree on the conditions under which to reinitiate the process referred to in paragraph 3 of this Article on the basis of the proposed measures.

8. The recognition, suspension or withdrawal of equivalence rests solely with the importing Party acting in accordance with its administrative and legislative framework. That Party shall provide to the exporting Party in writing full explanation and supporting data used for the determinations and decisions covered by this Article. In case of non-recognition, suspension or withdrawal of equivalence, the importing Party shall indicate to the exporting Party the required conditions on the basis of which the process referred to in paragraph 3 may be reinitiated.

9. Without prejudice to Article 64 of this Agreement, the importing Party may not withdraw or suspend equivalence before the proposed new measures of either Party enter into force.

10. In case equivalence is formally recognised by the importing Party, on the basis of the consultation process as set out in Annex VIII to this Agreement, the SPS Sub-Committee shall, in accordance with the procedure set out in Article 65(5) of this Agreement, declare the recognition of equivalence in trade between the Parties. This decision may also provide for the reduction of physical checks at the frontiers, simplification of certificates and pre-listing procedures for the establishments, as applicable.

The status of recognition of equivalence shall be listed in Annex XII to this Agreement.

Article 58

Transparency and exchange of information

1. Without prejudice to Article 59 of this Agreement, the Parties shall cooperate to enhance mutual understanding of the other Party's official control structure and mechanisms tasked with the application of the measures listed in Annex IV to this Agreement and of the performance of such structure and mechanism. This can be achieved, inter alia, through reports of international audits when these are made public and the Parties can exchange information on the results of such audits or other information, as appropriate.

2. In the framework of approximation of legislation as referred to in Article 55 of this Agreement or of recognition of equivalence as referred to in Article 57 of this Agreement, the Parties shall keep each other informed of legislative or procedural changes adopted in the concerned areas.

3. In this context, the Union shall inform Georgia well in advance of changes to the Union legislation to allow Georgia to consider modification of its legislation accordingly.

The necessary level of cooperation should be reached in order to facilitate transmission of legislative documents upon request of one of the Parties.

To this effect, each Party shall notify the other Party of its contact points. The Parties shall also notify each other of any changes to the contact points.

Article 59

Notification, consultation and facilitation of communication

1. Each Party shall notify in writing the other Party within two working days of any serious or significant human, animal or plant health risk, including any food control emergencies or situations where there is a clearly identified risk of serious health effects associated with the consumption of animal or plant products, in particular:

(a)	any measures affecting regionalisation decisions referred to in Article 56 of this Agreement;

(b)	the presence or evolution of any animal disease listed in Annex V-A to this Agreement or of the regulated pests listed in Annex V-B to this Agreement;

(c)	findings of epidemiological importance or important associated risks with respect to animal diseases and pests which are not listed in Annexes V-A and V-B to this Agreement or which are new animal diseases or pests; and

(d)	any additional measures beyond the basic requirements to their respective measures taken to control or eradicate animal diseases or pests or protect public or plant health and any changes in prophylactic policies, including vaccination policies.

2. Notifications shall be made in writing to the contact points referred to in Article 58(1) of this Agreement.

A notification in writing means notification by mail, fax or e-mail.

3. Where a Party has serious concerns regarding a risk to human, animal or plant health, consultations regarding the situation shall, upon request of that Party, take place as soon as possible and, in any case, within 15 working days from the date of that request. In such situations, each Party shall endeavour to provide all the information necessary to avoid a disruption in trade, and to reach a mutually acceptable solution consistent with the protection of human, animal or plant health.

4. Upon request of a Party, consultations regarding animal welfare shall take place as soon as possible and, in any case, within 20 working days from the date of notification. In such situations, each Party shall endeavour to provide all the requested information.

5. Upon request of a Party, consultations as referred to in paragraphs 3 and 4 of this Article shall be held by video or audio conference. The requesting Party shall ensure the preparation of the minutes of the consultation, which shall be formally approved by the Parties. For the purposes of this approval, the provisions of Article 58(3) of this Agreement shall apply.

6. A mutually applied rapid alert system and early warning mechanism for any veterinary and phytosanitary emergencies will start at a later stage after Georgia implements the necessary legislation in this field and creates conditions for their proper working on the spot.

Article 60

Trade conditions

1. Import conditions prior to recognition of equivalence:

(a)

The Parties agree to subject imports of any commodity covered by Annexes IV-A and IV-C(2) and (3) to this Agreement to conditions prior to recognition of equivalence. Without prejudice to the decisions taken in accordance with Article 56 of this Agreement, the import conditions of the importing Party shall be applicable to the total territory of the exporting Party. Upon entry into force of this Agreement and in accordance with the provisions of Article 58 of this Agreement, the importing Party shall inform the exporting Party of its sanitary and/or phytosanitary import requirements for commodities referred to in Annexes IV-A and IV-C to this Agreement. This information shall include, as appropriate, the models for the official certificates or declarations or commercial documents, as prescribed by the importing Party; and

(b)

(i)	Any amendment or proposed amendment of the conditions referred to in paragraph 1(a) of this Article shall comply with the relevant notification procedures of the SPS Agreement;

(ii)	Without prejudice to the provisions of Article 64 of this Agreement, the importing Party shall take into account the transport time between the Parties to establish the date of entering into force of the amended conditions referred to in paragraph 1(a) of this Article; and

(iii)

If the importing Party fails to comply with the notification requirements referred to in paragraph 1(a) of this Article, it shall continue to accept the certificate or the attestation guaranteeing the previously applicable conditions until 30 days after the amended import conditions enter into force.

2. Import conditions after recognition of equivalence:

(a)

Within 90 days following the date of the decision on recognition of equivalence as specified in Article 57(10) of this Agreement, the Parties shall take the necessary legislative and administrative measures to implement the recognition of equivalence in order to allow on that basis trade between them of commodities referred to in Annexes IV-A and IV-C(2) and (3) to this Agreement. For those commodities, the model for the official certificate or official document required by the importing Party may, then, be replaced by a certificate drawn up as provided for in Annex X-B to this Agreement;

(b)

For commodities in sectors or sub-sectors for which not all measures are recognised as equivalent, trade shall continue on the basis of compliance with the conditions referred to in paragraph 1(a) of this Article. Upon request of the exporting Party, the provisions of paragraph 5 of this Article shall apply.

3. From the date of entry into force of this Agreement, the commodities referred to Annexes IV-A and IV-C(2) to this Agreement shall not be subject to an import permit between the Parties.

4. For conditions affecting trade of the commodities referred to in paragraph 1(a) of this Article, upon request of the exporting Party, the Parties shall enter into consultations within the SPS Sub-Committee in accordance with the provisions of Article 65 of this Agreement, in order to agree on alternative or additional import conditions of the importing Party. Such alternative or additional import conditions may, when appropriate, be based on measures of the exporting Party recognised as equivalent by the importing Party. If agreed, the importing Party shall within 90 days take the necessary legislative and/or administrative measures to allow import on the basis of the agreed import conditions.

5. List of establishments, provisional approval

(a)

For the import of animal products referred to in Part 2 of Annex IV-A to this Agreement, upon request of the exporting Party accompanied by the appropriate guarantees, the importing Party shall provisionally approve processing establishments referred to in Annex VII.2 to this Agreement which are situated in the territory of the exporting Party, without prior inspection of individual establishments. Such approval shall be consistent with the conditions and provisions set out in Annex VII to this Agreement. Except when additional information is requested, the importing Party shall take the necessary legislative and/or administrative measures to allow import on that basis within 30 working days following the date of receipt of the request and the relevant guarantees by the importing Party.

The initial list of establishments shall be approved in accordance with the provisions of Annex VII to this Agreement.

(b)	For the import of animal products referred to in paragraph 2(a) of this Article, the exporting Party shall inform the importing Party of its list of establishments meeting the importing Party's requirements.

6. Upon request of a Party, the other Party shall provide the necessary explanation and the supporting data for the determinations and decisions covered by this Article.

Article 61

Certification procedure

1. For purposes of certification procedures and issuing of certificates and official documents the parties agree on the principles set out in Annex X to this Agreement.

2. The SPS Sub-Committee referred to in Article 65 of this Agreement may agree on the rules to be followed in case of electronic certification, withdrawal or replacement of certificates.

3. In the framework of approximated legislation as referred to in Article 55 of this Agreement, the Parties shall agree on common models of certificates, where applicable.

Article 62

Verification

1. In order to maintain confidence in the effective implementation of the provisions of this Chapter each Party has the right:

(a)	to carry out verification of all or part of the inspection and certification system of the other Party's authorities, and/or of other measures, where applicable, in accordance with the relevant international standards, guidelines and recommendations of Codex Alimentarius, OIE and IPPC;

(b)	to receive information from the other Party about its control system and be informed of the results of the controls carried out under that system respecting the confidentiality provisions applicable in either Party.

2. Either Party may share the results of the verifications referred to in paragraph 1(a) of this Article with third parties and make the results publicly available as may be required by provisions applicable to either Party. Confidentiality provisions applicable to either Party shall be respected in such sharing and/or publication of the results, where appropriate.

3. If the importing Party decides to carry out a verification visit to the exporting Party, the importing Party shall notify the exporting Party of this verification visit at least 60 working days before the verification visit is to be carried out, except in emergency cases or if the Parties agree otherwise. Any modification to this visit shall be agreed by the Parties.

4. The costs incurred in undertaking a verification of all or part of the other Party's competent authorities' inspection and certification systems and/or other measure, where applicable, shall be borne by the Party carrying out the verification or the inspection.

5. The draft written communication of verifications shall be forwarded to the exporting Party within 60 working days after the end of verification. The exporting Party shall have 45 working days to comment on the draft written communication. Comments made by the exporting Party shall be attached to and, where appropriate included in the final outcome. However, where a significant human, animal or plant health risk has been identified during the verification, the exporting Party shall be informed as quickly as possible and in any case within 10 working days following the end of the verification.

6. For clarity the results of verification may contribute to the procedures referred to in Articles 55, 57 and 63 of this Agreement conducted by the Parties or one of the Parties.

Article 63

Import checks and inspection fees

1. The Parties agree that import checks by the importing Party of consignments from the exporting Party shall respect the principles set out in Part A of Annex IX to this Agreement. The results of these checks may contribute to the verification process referred to in Article 62 of this Agreement.

2. The frequencies of physical import checks applied by each Party are set out in Part B of Annex IX to this Agreement. A Party may amend these frequencies within its competences and in accordance with its internal legislation, as a result of progress made in accordance with Articles 55, 57 and 60 of this Agreement, or as a result of verifications, consultations or other measures provided for in this Agreement. SPS Sub-Committee referred to in Article 65 shall modify Part B of Annex IX to this Agreement by decision, accordingly.

3. Inspection fees, if applicable, may only cover the costs incurred by the competent authority for performing import checks. The fee shall be calculated on the same basis as the fees charged for the inspection of similar domestic products.

4. The importing Party shall upon request of the exporting Party inform the latter of any amendment, including the reasons for such an amendment concerning the measures affecting import checks and inspection fees, and of any significant changes in the administrative conduct for such checks.

5. From a date to be determined by the SPS Sub-Committee referred to in Article 65 of this Agreement, the Parties may agree on the conditions to approve each other's controls referred to in Article 62(1)(b) of this Agreement with a view to adapt and reciprocally reduce, where applicable, the frequency of physical import checks for the commodities referred to in Article 60(2)(a) of this Agreement.

From that date the Parties may reciprocally approve each other's controls for certain commodities and, consequently reduce or replace the import checks for these commodities.

Article 64

Safeguard measures

1. Should the exporting Party take measures within its territory to control any cause likely to constitute a serious hazard or risk to human, animal or plant health, the exporting Party, without prejudice to the provisions of paragraph 2 of this Article, shall take equivalent measures to prevent the introduction of the hazard or risk into the territory of the importing Party.

2. On the basis of serious human, animal or plant health grounds, the importing Party may, take provisional measures necessary for the protection of human, animal or plant health. For consignments en route between the Parties, the importing Party shall consider the most suitable and proportionate solution in order to avoid unnecessary disruptions to trade.

3. The Party adopting measures under paragraph 2 of this Article, shall inform the other Party no later than one working day following the date of the adoption of the measures. Upon request of either Party, and in accordance with the provisions of Article 59(3) of this Agreement, the Parties shall hold consultations regarding the situation within 15 working days of the notification. The Parties shall take due account of any information provided through such consultations and shall endeavour to avoid unnecessary disruption to trade, taking into account, where applicable, the outcome of the consultations provided for in Article 59(3) of this Agreement.

Article 65

Sanitary and Phytosanitary Sub-Committee

1. The SPS Sub-Committee is hereby established. It shall meet within three months after the date of entry into force of this Agreement, upon request of either Party thereafter, or at least once every year. If agreed by the Parties, a meeting of the SPS Sub-Committee may be held by video or audio-conference. The SPS Sub-Committee may also address issues out of session, by correspondence.

2. SPS Sub-Committee shall have the following functions:

(a)	to consider any matter relating to this Chapter;

(b)	to monitor the implementation of this Chapter and examine all matters which may arise in relation to its implementation;

(c)	to review the Annexes IV to XII to this Agreement, notably in the light of progress made under the consultations and procedures provided for under this Chapter;

(d)	to modify by means of an endorsement decision Annexes IV to XII to this Agreement in the light of the review provided for in point (c) of this paragraph, or as otherwise provided in this Chapter; and

(e)	to give opinions and make recommendations to other bodies as defined in Title VIII (Institutional, General and Final Provisions) of this Agreement in light of the review provided for in point (c) of this paragraph.

3. The Parties agree to establish technical working groups, when appropriate, consisting of expert-level representatives of the Parties, which shall identify and address technical and scientific issues arising from the application of this Chapter. When additional expertise is required, the Parties may establish ad hoc groups, including scientific and expert groups. Membership of such ad hoc groups need not be restricted to representatives of the Parties.

4. SPS Sub-Committee shall regularly inform by means of a report the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, on its activities and decisions taken within competence.

5. The SPS Sub-Committee shall adopt its working procedures at its first meeting.

6. Any decision, recommendation, report or other action by the SPS Sub-Committee or any group established by the SPS Sub-Committee shall be adopted by consensus between the Parties.

CHAPTER 5

Customs and trade facilitation

Article 66

Objectives

1. The Parties acknowledge the importance of customs and trade facilitation matters in the evolving bilateral trade environment. The Parties agree to reinforce cooperation in this area with a view to ensuring that the relevant legislation and procedures, as well as the administrative capacity of the relevant administrations, fulfil the objectives of effective control and support facilitation of legitimate trade as a matter of principle.

2. The Parties recognise that utmost importance shall be given to public policy objectives including trade facilitation, security and prevention of fraud and a balanced approach to them.

Article 67

Legislation and procedures

1. The Parties agree that their respective trade and customs legislation, as a matter of principle, shall be stable and comprehensive, as well as that the provisions and the procedures shall be proportionate, transparent, predictable, non-discriminatory, impartial and applied uniformly and effectively and will, inter alia:

(a)	protect and facilitate legitimate trade through effective enforcement of and compliance with legislative requirements;

(b)	avoid unnecessary or discriminatory burdens on economic operators, prevent fraud and provide further facilitation for economic operators having a high level of compliance;

(c)	apply a Single Administrative Document (SAD) for the purposes of customs declarations;

(d)	lead to greater efficiency, transparency and simplification of customs procedures and practices at the border;

(e)	apply modern customs techniques, including risk assessment, post clearance controls and company audit methods in order to simplify and facilitate the entry, exit and the release of goods;

(f)	aim at reducing compliance costs and increasing predictability for all economic operators;

(g)	without prejudice to the application of objective risk assessment criteria, ensure the non-discriminatory administration of requirements and procedures applicable to imports, exports and goods in transit;

(h)

apply the international instruments applicable in the field of customs and trade including those developed by the World Customs Organisation (WCO), the Istanbul Convention on temporary admission of 1990, the International Convention on the Harmonised System of 1983, the WTO, the UN TIR Convention of 1975, the 1982 Convention on harmonisation of frontier controls of goods; and may take into account the WCO Framework of Standards to Secure and Facilitate Global Trade and European Commission guidelines such as the Customs Blueprints, where relevant;

(i)	take the necessary measures to reflect and implement the provisions of the Revised Kyoto Convention on the Simplification and Harmonisation of Customs Procedures of 1973;

(j)

provide for advance binding rulings on tariff classification and rules of origin. The Parties ensure that a ruling may be revoked or annulled only after notification to the affected operator and without retroactive effect, unless the rulings have been made on the basis of incorrect or incomplete information;

(k)	introduce and apply simplified procedures for authorised traders according to objective and non-discriminatory criteria;

(l)	set rules that ensure that any penalties imposed for breaches of customs regulations or procedural requirements be proportionate and non-discriminatory and, that their application, does not result in unwarranted and unjustified delays; and

(m)	apply transparent, non-discriminatory and proportionate rules where government agencies provide services also provided by the private sector.

2. In order to improve working methods, as well as to ensure non-discrimination, transparency, efficiency, integrity and accountability of operations, the Parties shall:

(a)	take further steps towards the reduction, the simplification and the standardisation of data and documentation required by customs and other relevant authorities;

(b)	simplify requirements and formalities wherever possible, with respect to the rapid release and clearance of goods;

(c)

provide effective, prompt and non-discriminatory procedures guaranteeing the right of appeal against customs and other relevant authorities' administrative actions, rulings and decisions affecting the goods submitted to customs. Such procedures for appeal shall be easily accessible and any costs shall be reasonable and commensurate with the costs incurred by the authorities to ensure the right of appeal;

(d)

take steps to ensure that where a disputed administrative action, ruling or decision is the subject of an appeal, goods should normally be released and duty payments may be left pending, subject to any safeguard measures judged necessary. Where required, the release of the goods should be subject to the provision of a guarantee, such as a surety or a deposit; and

(e)

ensure that the highest standards of integrity be maintained, in particular at the border, through the application of measures reflecting the principles of the relevant international conventions and instruments in this field, in particular the WCO Revised Arusha Declaration of 2003 and the European Commission Blueprint on Customs ethics of 2007, where appropriate.

3. The Parties agree to eliminate:

(a)	any requirements for the mandatory use of customs brokers; and

(b)	any requirements for the mandatory use of pre-shipment or destination inspections.

4. With regard to transit:

(a)

for the purposes of this Agreement, the transit rules and definitions set out in the WTO provisions, in particular Article V of GATT 1994, and related provisions, including any clarifications and amendments resulting from the Doha Round negotiations on trade facilitation shall apply. Those provisions also apply when the transit of goods begins or ends in the territory of a Party;

(b)	the Parties shall pursue the progressive interconnectivity of their respective customs transit systems, with a view to the future participation of Georgia in the common transit system (2);

(c)	the Parties shall ensure cooperation and coordination between all relevant authorities in their territories to facilitate traffic in transit. Parties shall also promote cooperation between the authorities and the private sector in relation to transit.

Article 68

Relations with the business community

The Parties agree:

(a)

to ensure that their respective legislation and procedures are transparent, publicly available, as far as possible through electronic means, and contain a justification for their adoption. There should be regular consultations and a reasonable time period between the publication of new or amended provisions and their entry into force;

(b)	on the need for timely and regular consultations with trade representatives on legislative proposals and procedures related to customs and trade issues;

(c)	to make publicly available relevant notices of administrative nature, including authority's requirements and entry or exit procedures, hours of operations and operating procedures for customs offices at ports and border crossing points, and points of contact for information enquiries;

(d)	to foster cooperation between operators and relevant administrations, using non-arbitrary and publicly accessible procedures based, inter alia, on those promulgated by the WCO; and

(e)	to ensure that their respective customs and customs-related requirements and procedures continue to meet the legitimate needs of the trading community, follow best practices, and remain the least trade-restrictive possible.

Article 69

Fees and charges

1. The Parties shall prohibit administrative fees having an equivalent effect to import or export duties or charges.

2. With regard to all fees and charges of whatever character imposed by the customs authorities of each Party, including fees and charges for tasks undertaken on behalf of the said authorities, upon or in connection with import or export and without prejudice to the relevant provisions of Chapter 1 (National Treatment and Market Access for Goods) of Title IV (Trade and Trade-related Matters) of this Agreement:

(a)

fees and charges may only be imposed for services provided at the request of the declarant outside normal working conditions, hours of operation and in places other than those referred to in the customs regulations, as well as for any formality related to such services and required for undertaking such import or export;

(b)	fees and charges shall not exceed the cost of the service provided;

(c)	fees and charges shall not be calculated on an ad valorem basis;

(d)

the information on the fees and the charges shall be published via an officially designated medium, and where feasible and possible, an official website. This information shall include the reason for the fee or the charge for the service provided, the responsible authority, the fees and the charges that will be applied, and when and how payment is to be made; and

(e)	new or amended fees and charges shall not be imposed until information on them is published and made readily available.

Article 70

Customs valuation

1. The provisions of Agreement on the Implementation of Article VII of GATT 1994 contained in Annex 1A to the WTO Agreement, including any subsequent amendments, shall govern the customs valuation of goods in the trade between the Parties. Those provisions of the WTO Agreement are hereby incorporated into this Agreement and made part thereof. Minimum customs values shall not be used.

2. The Parties shall cooperate with a view to reaching a common approach to issues relating to customs valuation.

Article 71

Customs cooperation

The Parties shall strengthen cooperation in the area of customs to ensure implementation of the objectives of this Chapter in order to further trade facilitation, while ensuring effective control, security and prevention of fraud. To that end the Parties may use, where appropriate, the European Commission Customs Blueprint as a benchmarking tool.

In order to ensure compliance with the provisions of this Chapter the Parties shall, inter alia:

(a)	exchange information concerning customs legislation and procedures;

(b)	develop joint initiatives relating to import, export and transit procedures, as well as work towards ensuring that an effective service is provided to the business community;

(c)	cooperate on the automation of customs and other trade procedures;

(d)	exchange, where appropriate, information and data subject to respect of the confidentiality of sensitive data and the protection of personal data;

(e)	cooperate in preventing and combating illicit cross-border traffic in goods, including in tobacco products;

(f)	exchange information or enter into consultations with a view to establishing where possible, common positions in international organisations in the field of customs such as the WTO, the WCO, the UN, the United Nations Conference on Trade And Development (UNCTAD) and the UN-ECE;

(g)	cooperate in the planning and delivery of technical assistance, notably to facilitate customs and trade facilitation reforms in accordance with the relevant provisions of this Agreement;

(h)	exchange best practices in customs operations, in particular on risk based customs control systems and on intellectual property rights enforcement, especially in relation to counterfeited products;

(i)	promote coordination between all border authorities of the Parties to facilitate border crossing process and enhance control, taking into account joint border controls, where feasible and appropriate; and

(j)	establish, where relevant and appropriate, mutual recognition of trade partnership programmes and customs controls, including equivalent trade facilitation measures.

Article 72

Mutual administrative assistance in customs matters

Without prejudice to other forms of cooperation envisaged in this Agreement, in particular in Article 71 of this Agreement, the Parties shall provide mutual administrative assistance in customs matters in accordance with the provisions of Protocol II on Mutual Administrative Assistance in Customs Matters to this Agreement.

Article 73

Technical assistance and capacity building

The Parties shall cooperate with a view to providing technical assistance and capacity building for the implementation of trade facilitation and customs reforms.

Article 74

Customs Sub-Committee

1. The Customs Sub-Committee is hereby established. It shall report to the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

2. The function of the Sub-Committee shall include regular consultations and monitoring of the implementation and the administration of this Chapter, including but not limited to the issues of customs cooperation, cross-border customs cooperation and management, technical assistance, rules of origin, trade facilitation, as well as mutual administrative assistance in customs matters.

3. The Customs Sub-Committee shall, inter alia:

(a)	see to the proper functioning of this Chapter and of Protocols I and II to this Agreement;

(b)	adopt practical arrangements, measures and decisions to implement this chapter and Protocols I and II to this Agreement, including on exchange of information and data, mutual recognition of customs controls and trade partnership programmes, and mutually agreed benefits;

(c)	exchange views on any points of common interest, including future measures and the resources needed for their implementation and application;

(d)	make recommendations where appropriate; and

(e)	adopt its internal rules of procedure.

Article 75

Approximation of customs legislation

Gradual approximation to the Union's customs law and certain international law shall be carried out as set out in Annex XIII to this Agreement.

CHAPTER 6

Establishment, trade in services and electronic commerce

Section 1

General provisions

Article 76

Objective, scope and coverage

1. The Parties, reaffirming their respective commitments under the WTO Agreement hereby lay down the necessary arrangements for the progressive reciprocal liberalisation of establishment and trade in services and for cooperation on electronic commerce.

2. Public procurement is covered in Chapter 8 (Public procurement) of Title IV (Trade and Trade-related Matters) of this Agreement and nothing in this Chapter shall be construed to impose any obligation with respect to public procurement.

3. Subsidies are covered in Chapter 10 (Competition) of Title IV (Trade and Trade-related Matters) of this Agreement and the provisions of this Chapter shall not apply to subsidies granted by the Parties.

4. Consistent with the provisions of this Chapter, each Party retains the right to regulate and to introduce new regulations to meet legitimate policy objectives.

5. This Chapter shall not apply to measures affecting natural persons seeking access to the employment market of a Party, nor shall it apply to measures regarding citizenship, residence or employment on a permanent basis.

6. Nothing in this Chapter shall prevent a Party from applying measures to regulate the entry of natural persons into, or their temporary stay in, its territory, 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 any Party under the terms of a specific commitment in this Chapter and Annex XIV to this Agreement (3).

Article 77

Definitions

For the purposes of this Chapter:

(a)	‘measure’ means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action or any other form;

(b)

‘measures adopted or maintained by a Party’ means measures taken by:

(i)	central, regional or local governments and authorities; and

(ii)	non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities;

(c)	‘natural person of a Party’ means a national of a Member State of the EU or a national of Georgia in accordance with the respective legislation;

(d)	‘juridical person’ means any legal entity duly constituted or otherwise organised 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)

‘juridical person of a Party’ means a juridical person as defined in point (d) and set up in accordance with the law of a Member State of the EU or of Georgia respectively, and having its registered office, central administration, or principal place of business in the territory (4) to which the Treaty on the Functioning of the European Union applies or in the territory of Georgia, respectively.

Should that juridical person have only its registered office or central administration in the territory to which the Treaty on the Functioning of the European Union applies or in the territory of Georgia respectively, it shall not be considered as a juridical person of the Union or a juridical person of Georgia respectively, unless its operations possess a real and continuous link with the economy of the Union or of Georgia, respectively;

Notwithstanding the preceding subparagraph, shipping companies established outside the Union or Georgia and controlled by nationals of a Member State of the EU or of Georgia, respectively, shall also be beneficiaries under this Agreement, if their vessels are registered in accordance with their respective legislation, in that Member State or in Georgia and fly the flag of a Member State or of Georgia;

(f)	‘subsidiary’ of a juridical person of a Party means a juridical person which is owned or effectively controlled by that juridical person (5);

(g)

‘branch’ of a juridical person means a place of business not having legal personality which has the appearance of permanency, such as the extension of a parent body, has a management structure and is materially equipped to negotiate business with third parties so that the latter, although knowing that there will, if necessary, be a legal link with the parent body, the head office of which is abroad, do not have to deal directly with such parent body but may transact business at the place of business constituting the extension;

(h)

‘establishment’ means:

(i)	as regards juridical persons of the Union or of Georgia, the right to take up and pursue economic activities by means of setting up, including the acquisition of, a juridical person and/or create a branch or a representative office in Georgia or in the Union respectively;

(ii)	as regards natural persons, the right of natural persons of the Union or of Georgia to take up and pursue economic activities as self-employed persons, and to set up undertakings, in particular companies, which they effectively control.

(i)	‘economic activities’ shall include activities of an industrial, commercial and professional character and activities of craftsmen and do not include activities performed in the exercise of governmental authority;

(j)	‘operations’ shall mean the pursuit of economic activities;

(k)	‘services’ includes any service in any sector except services supplied in the exercise of governmental authority;

(l)	‘services and other activities performed in the exercise of governmental authority’ are services or activities which are performed neither on a commercial basis nor in competition with one or more economic operators;

(m)

‘cross-border supply of services’ means the supply of a service:

(i)	from the territory of a Party into the territory of the other Party (Mode 1), or

(ii)	in the territory of a Party to the service consumer of the other Party (Mode 2);

(n)	‘service supplier’ of a Party means any natural or juridical person of a Party that seeks to supply or supplies a service;

(o)	‘entrepreneur’ means any natural or juridical person of a Party that seeks to perform or performs an economic activity through setting up an establishment.

Section 2

Establishment

Article 78

Scope

This Section applies to measures adopted or maintained by the Parties affecting establishment in all economic activities with the exception of:

(a)	mining, manufacturing and processing (6) of nuclear materials;

(b)	production of or trade in arms, munitions and war matèriel;

(c)	audio-visual services;

(d)	national maritime cabotage (7), and

(e)

domestic and international air transport services (8), whether scheduled or non-scheduled, and services directly related to the exercise of traffic rights, other than:

(i)	aircraft repair and maintenance services during which an aircraft is withdrawn from service;

(ii)	the selling and marketing of air transport services;

(iii)

computer reservation system (CRS) services;

(iv)	ground-handling services;

(v)	airport operation services.

Article 79

National treatment and most favoured nation treatment

1. Subject to the reservations listed in Annex XIV-E to this Agreement, Georgia shall grant, upon entry into force of this Agreement:

(a)

as regards the establishment of subsidiaries, branches and representative offices of juridical persons of the Union: treatment no less favourable than that accorded to its own juridical persons, their branches and representative offices; or to subsidiaries, branches and representative offices of any third country's juridical persons, whichever is the better;

(b)

as regards the operation of subsidiaries, branches and representative offices of juridical persons of the Union in Georgia, once established: treatment no less favourable than that accorded to its own juridical persons, their branches and representative offices; or to subsidiaries, branches and representative offices of any third country's juridical persons, whichever is the better (9).

2. Subject to reservations listed in Annex XIV-A to this Agreement, the Union shall grant, upon entry into force of this Agreement:

(a)

as regards the establishment of subsidiaries, branches and representative offices of juridical persons of Georgia: treatment no less favourable than that accorded to its own juridical persons, their branches and representative offices; or to subsidiaries, branches and representative offices of any third country's juridical persons, whichever is the better;

(b)

as regards the operation of subsidiaries, branches and representative offices of juridical persons of Georgia in the Union, once established: treatment no less favourable than that accorded to its own juridical persons, their branches and representative offices; or to subsidiaries, branches and representative offices of any third country's juridical persons, whichever is the better (10).

3. Subject to reservations listed in Annexes XIV-A and XIV-E to this Agreement, the Parties shall not adopt any new regulations or measures which introduce discrimination as regards the establishment of juridical persons of the Union or of Georgia on their territory or in respect of their operation, once established, by comparison with their own juridical persons.

Article 80

Review

1. With a view to progressively liberalising the establishment conditions, the Parties shall regularly review the provisions of this Section and the list of reservations referred to in Article 79 of this Agreement as well as the establishment environment, consistent with their commitments in international agreements.

2. In the context of the review referred to in paragraph 1, the Parties shall assess any obstacles to establishment that have been encountered. With a view to deepening the provisions of this Chapter, the Parties shall find, if need be, appropriate ways to address such obstacles, which could include further negotiations, including with respect to investment protection and to investor-to-state dispute settlement procedures.

Article 81

Other agreements

This Chapter shall not affect the rights of entrepreneurs of the Parties arising from any existing or future international agreement relating to investment, to which a Member State of the EU and Georgia are parties.

Article 82

Standard of treatment for branches and representative offices

1. The provisions of Article 79 of this Agreement do not preclude the application by a Party of particular rules concerning the establishment and operation in its territory of branches and representative offices of juridical persons of another Party not incorporated in the territory of the first Party, which are justified by legal or technical differences between such branches and representative offices as compared to branches and representative offices of juridical persons incorporated in its territory or, as regards financial services, for prudential reasons.

2. The difference in treatment shall not go beyond what is strictly necessary as a result of such legal or technical differences or, as regards financial services, for prudential reasons.

Section 3

Cross-border supply of services

Article 83

Scope

This Section applies to measures of the Parties affecting the cross border supply of all services sectors with the exception of:

(a)	audio-visual services;

(b)	national maritime cabotage (11), and

(c)

domestic and international air transport services (12), whether scheduled or non-scheduled, and services directly related to the exercise of traffic rights other than:

(i)	aircraft repair and maintenance services during which an aircraft is withdrawn from service;

(ii)	the selling and marketing of air transport services;

(iii)

computer reservation system (CRS) services;

(iv)	ground-handling services;

(v)	airport operation services.

Article 84

Market access

1. With respect to market access through the cross-border supply of services, each Party shall accord services and service suppliers of the other Party a treatment not less favourable than that provided for in the specific commitments contained in Annexes XIV-B and XIV-F to this Agreement.

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 territory, unless otherwise specified in Annexes XIV-B and XIV-F to this Agreement are defined as:

(a)	limitations on the number of services 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, or

(c)	limitations on the total number of service operations or on the total quantity of service output expressed in the terms of designated numerical units in the form of quotas or the requirement of an economic needs test.

Article 85

National treatment

1. In the sectors where market access commitments are inscribed in Annexes XIV-B and XIV-F to this Agreement, and subject to any conditions and qualifications set out therein, each Party shall grant to services and service suppliers of the other Party, in respect of all measures affecting the cross-border supply of services, treatment no less favourable than that it accords to its own like services and services 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 compared to like services or service suppliers of the other Party.

4. Specific commitments entered into under this Article shall not be construed to require any Party to compensate for inherent competitive disadvantages which result from the foreign character of the relevant services or services suppliers.

Article 86

Lists of commitments

The sectors liberalised by each Party pursuant to this Section and, by means of reservations, the market access and national treatment limitations applicable to services and services suppliers of the other Party in those sectors are set out in lists of commitments included in Annexes XIV-B and XIV-F to this Agreement.

Article 87

Review

With a view to the progressive liberalisation of the cross-border supply of services between the Parties, the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, shall regularly review the list of commitments referred to in Article 86 of this Agreement. This review shall take into account the process of gradual approximation, referred to in Articles 103, 113, 122 and 126 of this Agreement, and its impact on the elimination of remaining obstacles to cross-border supply of services between the Parties.

Section 4

Temporary presence of natural persons for business purposes

Article 88

Scope and definitions

1. This Section applies to measures of the Parties concerning the entry and temporary stay in their territories of key personnel, graduate trainees, business sellers, contractual service suppliers and independent professionals in accordance with Article 76(5) of this Agreement.

2. For the purposes of this Section:

(a)

‘key personnel’ means natural persons employed within a juridical person of one Party other than a non-profit organisation (13) and who are responsible for the setting-up or the proper control, administration and operation of an establishment. ‘Key personnel’ comprise ‘business visitors’ for establishment purposes and ‘intra-corporate transferees’:

(i)

‘business visitors’ for establishment purposes means natural persons working in a senior position who are responsible for setting up an establishment. They do not offer or provide services or engage in any other economic activity than required for establishment purposes. They do not receive remuneration from a source located within the host Party;

(ii)

‘intra-corporate transferees’ means natural persons who have been employed by a juridical person or have been partners in it for at least one year and who are temporarily transferred to an establishment that may be a subsidiary, branch or head company of the enterprise / juridical person in the territory of the other Party. The natural person concerned must belong to one of the following categories:

(1)

managers: persons working in a senior position within a juridical person, who primarily direct the management of the establishment, receiving general supervision or direction principally from the board of directors or from stockholders of the business or their equivalent, including at least:

—	directing the establishment or a department or sub-division thereof;

—	supervising and controlling the work of other supervisory, professional or managerial employees; and

—	having the authority personally to recruit and dismiss or recommend recruiting, dismissing or other personnel actions;

(2)

specialists: persons working within a juridical person who possess uncommon knowledge essential to the establishment's production, research equipment, techniques, processes, procedures or management. In assessing such knowledge, account will be taken not only of knowledge specific to the establishment, but also of whether the person has a high level of qualification referring to a type of work or trade requiring specific technical knowledge, including membership of an accredited profession.

(b)

‘graduate trainees’ means natural persons who have been employed by a juridical person of one Party or its branch for at least one year, possess a university degree and are temporarily transferred to an establishment of the juridical person in the territory of the other Party, for career development purposes or to obtain training in business techniques or methods (14);

(c)

‘business sellers’ (15) means natural persons who are representatives of a services or goods supplier of one Party seeking entry and temporary stay in the territory of the other Party for the purpose of negotiating the sale of services or goods, or entering into agreements to sell services or goods for that supplier. They do not engage in making direct sales to the general public and do not receive remuneration from a source located within the host Party, nor are they commission agents;

(d)

‘contractual services suppliers’ means natural persons employed by a juridical person of one Party which itself is not an agency for placement and supply services of personnel nor acting through such an agency, has no establishment in the territory of the other Party and has concluded a bona fide contract to supply services with a final consumer in the latter Party, requiring the presence on a temporary basis of its employees in that Party, in order to fulfil the contract to provide services;

(e)

‘independent professionals’ means natural persons engaged in the supply of a service and established as self-employed in the territory of a Party who have no establishment in the territory of the other Party and who have concluded a bona fide contract (other than through an agency for placement and supply services of personnel) to supply services with a final consumer in the latter Party, requiring their presence on a temporary basis in that Party in order to fulfil the contract to provide services;

(f)	‘qualifications’ means diplomas, certificates and other evidence (of formal qualification) issued by an authority designated pursuant to legislative, regulatory or administrative provisions and certifying successful completion of professional training.

Article 89

Key personnel and graduate trainees

1. For every sector committed in accordance with Section 2 (Establishment) of this Chapter and subject to any reservations listed in Annexes XIV-A and XIV-E to this Agreement, or in Annexes XIV-C and XIV-G to this Agreement, each Party shall allow entrepreneurs of the other Party to employ in their establishment natural persons of that other Party provided that such employees are key personnel or graduate trainees as defined in Article 88 to this Agreement. The temporary entry and temporary stay of key personnel and graduate trainees shall be for a period of no longer than three years for intra-corporate transferees, 90 days in any 12-month period for business visitors for establishment purposes, and one year for graduate trainees.

2. For every sector committed in accordance with Section 2 (Establishment) of this Chapter, 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 territory, unless otherwise specified in Annexes XIV-C and XIV-G to this Agreement, are defined as limitations on the total number of natural persons that an entrepreneur may employ as key personnel and graduate trainees in a specific sector in the form of numerical quotas or a requirement of an economic needs test and as discriminatory limitations.

Article 90

Business sellers

For every sector committed in accordance with Section 2 (Establishment) or Section 3 (Cross-border supply of services) of this Chapter and subject to any reservations listed in Annexes XIV-A, XIV-E, and XIV-B and XIV-F to this Agreement, each Party shall allow the entry and temporary stay of business sellers for a period of no longer than 90 days in any 12-month period.

Article 91

Contractual service suppliers

1. The Parties reaffirm their respective obligations arising from their commitments under the General Agreement on Trade in Services (GATS) as regards the entry and temporary stay of contractual services suppliers. In accordance with Annexes XIV-D and XIV-H to this Agreement, each Party shall allow the supply of services into their territory by contractual services suppliers of the other Party, subject to the conditions specified in paragraph 2 of this Article.

2. The commitments undertaken by the Parties are subject to the following conditions:

(a)	the natural persons must be engaged in the supply of a service on a temporary basis as employees of a juridical person, which has obtained a service contract not exceeding 12 months;

(b)

the natural persons entering the other Party should be offering such services as employees of the juridical person supplying the services for at least the year immediately preceding the date of submission of an application for entry into the other Party. In addition, the natural persons must possess, at the date of submission of an application for entry into the other Party, at least three years professional experience (16) in the sector of activity which is the subject of the contract;

(c)

the natural persons entering the other Party must possess:

(i)	a university degree or a qualification demonstrating knowledge of an equivalent level (17); and

(ii)	professional qualifications where this is required to exercise an activity pursuant to the laws, regulations or legal requirements of the Party where the service is supplied;

(d)	the natural person shall not receive remuneration for the provision of services in the territory of the other Party other than the remuneration paid by the juridical person employing the natural person;

(e)	the entry and temporary stay of natural persons within the Party concerned shall be for a cumulative period of not more than six months or, in the case of Luxembourg, 25 weeks in any 12-month period or for the duration of the contract, whichever is less;

(f)	access accorded under the provisions of this Article relates only to the service activity which is the subject of the contract and does not confer entitlement to exercise the professional title of the Party where the service is supplied;

(g)	the number of persons covered by the service contract shall not be larger than necessary to fulfil the contract, as it may be requested by the laws, regulations or other legal requirements of the Party where the service is supplied.

Article 92

Independent professionals

1. In accordance with Annexes XIV-D and XIV-H to this Agreement, the Parties shall allow the supply of services into their territory by independent professionals of the other Party, subject to the conditions specified in paragraph 2 of this Article.

2. The commitments undertaken by the Parties are subject to the following conditions:

(a)	the natural persons must be engaged in the supply of a service on a temporary basis as self-employed persons established in the other Party and must have obtained a service contract for a period not exceeding 12 months;

(b)	the natural persons entering the other Party must possess, at the date of submission of an application for entry into the other Party, at least six years professional experience in the sector of activity which is the subject of the contract;

(c)

the natural persons entering the other Party must possess:

(i)	a university degree or a qualification demonstrating knowledge of an equivalent level (18) and

(ii)	professional qualifications where this is required to exercise an activity pursuant to the laws, regulations or other legal requirements of the Party where the service is supplied;

(d)	the entry and temporary stay of natural persons within the Party concerned shall be for a cumulative period of not more than six months or, in the case of Luxembourg, 25 weeks in any 12-month period or for the duration of the contract, whichever is less;

(e)	access accorded under the provisions of this Article relates only to the service activity which is the subject of the contract and does not confer entitlement to exercise the professional title of the Party where the service is provided.

Section 5

Regulatory framework

Sub-section 1

Domestic regulation

Article 93

Scope and definitions

1. The following disciplines apply to measures by the Parties relating to licencing requirements and procedures, qualification requirements and procedures that affect:

(a)	cross-border supply of services;

(b)	establishment in their territory of juridical and natural persons defined in Article 77(9) of this Agreement, and

(c)	temporary stay in their territory of categories of natural persons as defined in points (a) to (e) of Article 88(2) of this Agreement.

2. In the case of cross-border supply of services, those disciplines shall only apply to sectors for which the Party has undertaken specific commitments and to the extent that these specific commitments apply in accordance with Annexes XIV-B and XIV-F to this Agreement. In the case of establishment, those disciplines shall not apply to sectors to the extent that a reservation is listed in accordance with Annexes XIV-A and XIV-E to this Agreement. In the case of temporary stay of natural persons, these disciplines shall not apply to sectors to the extent that a reservation is listed in accordance with Annexes XIV-C, XIV-D, XIV-G and XIV-H to this Agreement.

3. Those disciplines do not apply to measures to the extent that they constitute limitations under the relevant Annexes to this Agreement.

4. For the purposes of this Section:

(a)	‘licencing requirements’ means substantive requirements, other than qualification requirements, with which a natural or a juridical person is required to comply in order to obtain, amend or renew authorisation to carry out the activities as defined in points (a) to (c) of paragraph 1;

(b)

‘licencing procedures’ means administrative or procedural rules that a natural or a juridical person, seeking authorisation to carry out the activities as defined in points (a) to (c) of paragraph 1, including the amendment or renewal of a licence, must adhere to in order to demonstrate compliance with licencing requirements;

(c)	‘qualification requirements’ means substantive requirements relating to the competence of a natural person to supply a service, and which are required to be demonstrated for the purpose of obtaining authorisation to supply a service;

(d)	‘qualification procedures’ means administrative or procedural rules that a natural person must adhere to in order to demonstrate compliance with qualification requirements, for the purpose of obtaining authorisation to supply a service;

(e)

‘competent authority’ means any central, regional or local government and authority or non-governmental body in the exercise of powers delegated by central or regional or local governments or authorities, which takes a decision concerning the authorisation to supply a service, including through establishment or concerning the authorisation to establish in an economic activity other than services.

Article 94

Conditions for licencing and qualification

1. Each Party shall ensure that measures relating to licencing requirements and procedures, qualification requirements and procedures are based on criteria which preclude the competent authorities from exercising their power of assessment in an arbitrary manner.

2. The criteria referred to in paragraph 1 shall be:

(a)	proportionate to a public policy objective;

(b)	clear and unambiguous;

(c)	objective;

(d)	pre-established;

(e)	made public in advance;

(f)	transparent and accessible.

3. An authorisation or a licence shall be granted as soon as it is established, in the light of an appropriate examination, that the conditions for obtaining an authorisation or licence have been met.

4. Each Party shall maintain or institute judicial, arbitral or administrative tribunals or procedures which provide, at the request of an affected entrepreneur or service supplier, for a prompt review of, and where justified, appropriate remedies for, administrative decisions affecting establishment, cross-border supply of services or temporary presence of natural persons for business purposes. Where such procedures are not independent of the agency entrusted with the administrative decision concerned, each Party shall ensure that the procedures in fact provide for an objective and impartial review.

5. Where the number of licences available for a given activity is limited because of the scarcity of available natural resources or technical capacity, each Party shall apply a selection procedure to potential candidates which provides full guarantees of impartiality and transparency, including, in particular, adequate publicity about the launch, conduct and completion of the procedure.

6. Subject to the provisions specified by this Article, in establishing the rules for the selection procedure, each Party may take into account public policy objectives, including considerations of health, safety, the protection of the environment and the preservation of cultural heritage.

Article 95

Licencing and qualification procedures

1. Licencing and qualification procedures and formalities shall be clear, made public in advance and be such as to provide the applicants with a guarantee that their application will be dealt with objectively and impartially.

2. Licencing and qualification procedures and formalities shall be as simple as possible and shall not unduly complicate or delay the provision of the service. Any licencing fees (19) which the applicants may incur from their application should be reasonable and proportionate to the cost of the authorisation procedures in question.

3. Each Party shall ensure that the procedures used by, and the decisions of, the competent authority in the licencing or authorisation process are impartial with respect to all applicants. The competent authority should reach its decision in an independent manner and not be accountable to any supplier of the services for which the licence or authorisation is required.

4. Where specific time periods for applications exist, an applicant shall be allowed a reasonable period for the submission of an application. The competent authority shall initiate the processing of an application without undue delay. Where possible, applications should be accepted in electronic format under the same conditions of authenticity as paper submissions.

5. Each Party shall ensure that the processing of an application, including reaching a final decision, is completed within a reasonable timeframe from the submission of a complete application. Each Party shall endeavour to establish the normal timeframe for processing of an application.

6. The competent authority shall, within a reasonable period of time after receipt of an application which it considers incomplete, inform the applicant, to the extent feasible identify the additional information required to complete the application, and provide the opportunity to correct deficiencies.

7. Authenticated copies should be accepted, where possible, in place of original documents.

8. If an application is rejected by the competent authority, the applicant shall be informed in writing and without undue delay. In principle, the applicant shall, upon request, also be informed of the reasons for rejection of the application and of the timeframe for an appeal against the decision.

9. Each Party shall ensure that a licence or an authorisation, once granted, enters into effect without undue delay in accordance with the terms and conditions specified therein.

Sub-section 2

Provisions of general application

Article 96

Mutual recognition

1. Nothing in this Chapter shall prevent a Party from requiring that natural persons must possess the necessary qualifications and/or professional experience specified in the territory where the service is supplied, for the sector of activity concerned.

2. Each Party shall encourage the relevant professional bodies in their respective territories to provide recommendations on mutual recognition to the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, for the purpose of the fulfilment, in whole or in part, by entrepreneurs and service suppliers of the criteria applied by each Party for the authorisation, licensing, operation and certification of entrepreneurs and service suppliers and, in particular, professional services.

3. On receipt of a recommendation referred to in paragraph 2, the Association Committee in Trade configuration shall, within a reasonable time, review that recommendation with a view to determine whether it is consistent with this Agreement, and on the basis of the information contained therein, assess in particular:

(a)	the extent to which the standards and criteria applied by each Party for the authorisation, licenses, operation and certification of services providers and entrepreneurs are converging, and

(b)	the potential economic value of a mutual recognition agreement.

4. Where these requirements are satisfied, the Association Committee in Trade configuration shall establish the necessary steps to negotiate and thereafter the Parties shall engage into negotiations, through their competent authorities, of a mutual recognition agreement.

5. Any such agreement shall be in conformity with the relevant provisions of the WTO Agreement and, in particular, Article VII of GATS.

Article 97

Transparency and disclosure of confidential information

1. Each Party shall respond promptly to all requests by the other Party for specific information on any of its measures of general application or international agreements which pertain to or affect this Agreement. Each Party shall also establish one or more enquiry points to provide specific information to entrepreneurs and services suppliers of the other Party, upon request, on all such matters. The Parties shall notify each other enquiry points within three months after the date of entry into force of this Agreement. Enquiry points need not be depositories of laws and regulations.

2. Nothing in this Agreement shall require any Party to provide confidential information, the disclosure of which would impede law enforcement, or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests of particular enterprises, public or private.

Sub-section 3

Computer services

Article 98

Understanding on computer services

1. To the extent that trade in computer services is liberalised in accordance with Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter, the Parties shall comply with paragraphs 2, 3 and 4 of this Article.

2. CPC (20) 84, the UN code used for describing computer and related services, covers the basic functions used to provide all computer and related services:

(a)	computer programmes defined as the sets of instructions required to make computers work and communicate (including their development and implementation);

(b)	data processing and storage, and

(c)	related services, such as consultancy and training services for staff of clients.

Technological developments have led to the increased offering of those services as a bundle or package of related services that can include some or all of those basic functions. For example, services such as web- or domain-hosting, data mining services and grid computing each consist of a combination of basic computer services functions.

3. Computer and related services, regardless of whether they are delivered via a network, including the internet, include all services that provide:

(a)	consulting, strategy, analysis, planning, specification, design, development, installation, implementation, integration, testing, debugging, updating, support, technical assistance, or management of or for computers or computer systems;

(b)

computer programmes defined as sets of instructions required to make computers work and communicate (in and of themselves), plus consulting, strategy, analysis, planning, specification, design, development, installation, implementation, integration, testing, debugging, updating, adaptation, maintenance, support, technical assistance, management or use of or for computer programs; or

(c)	data processing, data storage, data hosting or database services; or maintenance and repair services for office machinery and equipment, including computers; or training services for staff of clients, related to computer programmes, computers or computer systems, and not elsewhere classified.

4. Computer and related services enable the provision of other services (e.g. banking) by both electronic and other means. However, there is an important distinction between the enabling service (e.g. web-hosting or application-hosting) and the content or core service that is being delivered electronically (e.g. banking). In such cases, the content or core service is not covered by CPC 84.

Sub-section 4

Postal and courier services

Article 99

Scope and definitions

1. This Sub-Section sets out the principles of the regulatory framework for all postal and courier service liberalised in accordance with Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter.

2. For the purpose of this Sub-Section and of Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter:

(a)	‘licence’ means an authorisation, granted to an individual supplier by a regulatory authority, which is required before supplying a given service;

(b)	‘universal service’ means the permanent provision of a postal service of specified quality at all points in the territory of a Party at affordable prices for all users.

Article 100

Universal service

Each Party has the right to define the kind of universal service obligation it wishes to maintain. Such obligations will not be regarded as anti-competitive per se, provided they are administered in a transparent, non-discriminatory and competitively neutral manner and are not more burdensome than necessary for the kind of universal service defined by the Party.

Article 101

Licences

1. A licence may only be required for services which are within the scope of the universal service.

2. Where a licence is required, the following shall be made publicly available:

(a)	all the licensing criteria and the period of time normally required to reach a decision concerning an application for a licence; and

(b)	the terms and conditions of licences.

3. The reasons for the denial of a licence shall be made known to the applicant upon request and an appeal procedure through an independent body will be established by each Party. Such a procedure will be transparent, non-discriminatory and based on objective criteria.

Article 102

Independence of the regulatory body

The regulatory body shall be legally separate from, and not accountable to any supplier of postal and courier services. The decisions of and the procedures used by the regulatory body shall be impartial with respect to all market participants.

Article 103

Gradual approximation

With a view to considering further liberalisation of trade in services, the Parties recognise the importance of the gradual approximation of the existing and future legislation of Georgia to the list of the Union acquis included in Annex XV-C to this Agreement.

Sub-section 5

Electronic communication networks and services

Article 104

Scope and definitions

1. This Sub-Section sets out the principles of the regulatory framework for all electronic communication services liberalised pursuant to Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter.

2. For the purpose of this Sub-Section and Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter:

(a)

‘electronic communication services’ means all services which consist wholly or mainly in the conveyance of signals on electronic communication networks, including telecommunication services and transmission services in networks used for broadcasting. Those services exclude services providing, or exercising editorial control over, content transmitted using electronic communication networks and services;

(b)	‘public communication network’ means an electronic communication network used wholly or mainly for the provision of publicly available electronic communication services;

(c)

‘electronic communication network’ means transmission systems and, where applicable, switching or routing equipment and other resources which permit the conveyance of signals by wire, by radio, by optical or by other electromagnetic means, including satellite networks, fixed (circuit- and packet-switched, including internet) and mobile terrestrial networks, electricity cable systems, to the extent that they are used for the purpose of transmitting signals, networks used for radio and television broadcasting, and cable television networks, irrespective of the type of information conveyed;

(d)	a ‘regulatory authority’ in the electronic communication sector means the body or bodies charged with the regulation of electronic communication mentioned in this Sub-Section;

(e)

a services supplier shall be deemed to have ‘significant market power’ if, either individually or jointly with others, it enjoys a position equivalent to dominance, that is to say a position of economic strength affording it the power to behave to an appreciable extent independently of competitors, customers and ultimately consumers;

(f)

‘interconnection’ means the physical and logical linking of public communication networks used by the same or a different supplier in order to allow the users of one services supplier to communicate with users of the same or another services supplier, or to access services provided by another services supplier. Services may be provided by the parties involved or other parties who have access to the network. Interconnection is a specific type of access implemented between public network operators;

(g)	‘universal service’ means the set of services of specified quality that is made available to all users in the territory of a Party regardless of their geographical location and at an affordable price; its scope and implementation are decided by each Party;

(h)

‘access’ means the making available of facilities and/or services, to another services supplier, under defined conditions, on either an exclusive or non-exclusive basis, for the purpose of providing electronic communication services. It covers, inter alia, access to network elements and associated facilities, which may involve the connection of equipment, by fixed or non-fixed means (in particular this includes access to the local loop and to facilities and services necessary to provide services over the local loop), access to physical infrastructure, including buildings, ducts, and masts; access to relevant software systems, including operational support systems; access to numbering translation or systems offering equivalent functionality; access to fixed and mobile networks, in particular for roaming; access to conditional access systems for digital televisions services; access to virtual network services;

(i)	‘end-user’ means a user not providing public communication networks or publicly available electronic communication services;

(j)	‘local loop’ means the physical circuit connecting the network termination point at the subscriber's premises to the main distribution frame or equivalent facility in the fixed public communication network.

Article 105

Regulatory authority

1. Each Party shall ensure that regulatory authorities for electronic communication services shall be legally distinct and functionally independent from any supplier of electronic communication services. If a Party retains ownership or control of a supplier providing electronic communication networks or services, such Party shall ensure the effective structural separation of the regulatory function from activities associated with ownership or control.

2. Each Party shall ensure that the regulatory authority shall be sufficiently empowered to regulate the sector. The tasks to be undertaken by a regulatory authority shall be made public in an easily accessible and clear form, in particular where those tasks are assigned to more than one body.

3. Each Party shall ensure that the decisions of and the procedures used by the regulatory authorities are impartial with respect to all market participants and transparent.

4. The regulatory authority shall have the power to carry out an analysis of relevant product and service markets liable to an ex ante regulation. Where the regulatory authority is required to determine under Article 107 of this Agreement whether to impose, maintain, amend or withdraw obligations it shall determine on the basis of a market analysis whether the relevant market is effectively competitive.

5. Where the regulatory authority determines that a relevant market is not effectively competitive, it shall identify and designate services suppliers with significant market power on that market and shall impose, maintain or amend specific regulatory obligations referred to in Article 107 of this Agreement as it is appropriate. Where the regulatory authority concludes that the market is effectively competitive it shall not impose or maintain any of the regulatory obligations referred to in Article 107 of this Agreement.

6. Each Party shall ensure that a services supplier affected by the decision of a regulatory authority shall have a right to appeal against that decision to an appeal body that is independent of the parties involved in the decision. Each Party shall ensure that the merits of the case are duly taken into account. Pending the outcome of any such appeal, the decision of the regulator shall stand, unless the appeal body decides otherwise. Where the appeal body is not judicial in character, written reasons for its decision shall always be given and its decisions shall also be subject to review by an impartial and independent judicial authority. Decisions taken by appeal bodies shall be effectively enforced.

7. Each Party shall ensure that where the regulatory authorities intend to take measures related to any of the provisions of this Sub-Section and which have a significant impact to the relevant market, they give the interested parties the opportunity to comment on the draft measure within a reasonable period of time. Regulators shall publish their consultation procedures. The results of the consultation procedure shall be made publicly available except in the case of confidential information.

8. Each Party shall ensure that suppliers providing electronic communication networks and services provide all the information, including financial information, necessary for regulatory authorities to ensure conformity with the provisions of this Sub-Section or decisions made in accordance with this Sub-Section. These suppliers shall provide such information promptly on request and to the time-table and level of detail required by the regulatory authority. The information requested by the regulatory authority shall be proportionate to the performance of that task. The regulatory authority shall give the reasons justifying its request for information.

Article 106

Authorisation to provide electronic communication services

1. Each Party shall ensure that the provision of services shall, as much as possible, be authorised following mere notification.

2. Each Party shall ensure that a licence can be required to address issues of attributions of numbers and frequencies. The terms and conditions for such licences shall be made publicly available.

3. Each Party shall ensure that where a licence is required:

(a)	all the licensing criteria and a reasonable period of time normally required to reach a decision concerning an application for a licence shall be made publicly available;

(b)	the reasons for the denial of a licence shall be made known in writing to the applicant upon request;

(c)	the applicant of a licence shall be able to seek recourse before an appeal body in case that a licence is unduly denied;

(d)

licence fees (21) required by any Party for granting a licence shall not exceed the administrative costs normally incurred in the management, control and enforcement of the applicable licences. Licence fees for the use of radio spectrum and numbering resources are not subject to the requirements of this paragraph.

Article 107

Access and interconnection

1. Each Party shall ensure that any services suppliers authorised to provide electronic communication services have the right and obligation to negotiate access and interconnection with suppliers of publicly available electronic communication networks and services. Access and interconnection should in principle be agreed on the basis of commercial negotiation between the services suppliers concerned.

2. Each Party shall ensure that services suppliers that acquire information from another services supplier during the process of negotiating interconnection arrangements use that information solely for the purpose for which it was supplied and respect at all times the confidentiality of information transmitted or stored.

3. Each Party shall ensure that upon the finding in accordance with Article 105 of this Agreement that a relevant market is not effectively competitive, the regulatory authority shall have the power to impose on the supplier designated as having significant market power one or more of the following obligations in relation to interconnection and/or access:

(a)

obligation on non-discrimination to ensure that the operator applies equivalent conditions in equivalent circumstances to other suppliers providing equivalent services, and provides services and information to others under the same conditions and of the same quality as it provides for its own services, or those of its subsidiaries or partners;

(b)

obligation of a vertically integrated company to make transparent its wholesale prices and its internal transfer prices, where there is a requirement for non-discrimination or for prevention of unfair cross-subsidy. The regulatory authority may specify the format and accounting methodology to be used;

(c)

obligations to meet reasonable requests for access to, and use of, specific network elements and associated facilities, including unbundled access to the local loop, inter alia, in situations where the regulatory authority considers that denial of access or unreasonable terms and conditions having a similar effect would hinder the emergence of a sustainable competitive market at the retail level, or would not be in the end user's interest.

Regulatory authorities may attach conditions covering fairness, reasonableness and timeliness to the obligations included under this point;

(d)

to provide specified services on a wholesale basis for resale by third parties; to grant open access to technical interfaces, protocols or other key technologies that are indispensable for the interoperability of services or virtual network services; to provide co-location or other forms of facility sharing, including duct, building or mast sharing; to provide specified services needed to ensure interoperability of end-to-end services to users, including facilities for intelligent network services; to provide access to operational support systems or similar software systems necessary to ensure fair competition in the provision of services; to interconnect networks or network facilities.

Regulatory authorities may attach conditions covering fairness, reasonableness and timeliness to the obligations included under this point;

(e)

obligations relating to cost recovery and price controls, including obligations for cost orientation of prices and obligations concerning cost accounting systems, for the provision of specific types of interconnection and/or access, in situations where a market analysis indicates that a lack of effective competition means that the operator concerned might sustain prices at an excessively high level, or apply a price squeeze, to the detriment of end-users.

Regulatory authorities shall take into account the investment made by the operator and allow the operator a reasonable rate of return on adequate capital employed, taking into account the risks involved;

(f)

to publish the specific obligations imposed on services suppliers by the regulatory authority identifying the specific product/service and geographical markets. Up-to-date information, provided that it is not confidential and it does not comprise business secrets is made publicly available in a manner that guarantees all interested parties easy access to that information;

(g)

obligations for transparency requiring operators to make public specified information and, in particular, where an operator has obligations of non-discrimination, the regulator may require that operator to publish a reference offer, which shall be sufficiently unbundled to ensure that services suppliers are not required to pay for facilities which are not necessary for the service requested, giving a description of the relevant offerings broken down into components according to market needs, and the associated terms and conditions including prices.

4. Each Party shall ensure that a service supplier requesting interconnection with a supplier designated as having significant market power shall have recourse, either at any time or after a reasonable period of time which has been made publicly known, to an independent domestic body, which may be a regulatory body as referred to in Article 104(2)(d) of this Agreement, to resolve disputes regarding terms and conditions for interconnection and/or access.

Article 108

Scarce resources

1. Each Party shall ensure that any procedures for the allocation and use of scarce resources, including frequencies, numbers and rights of way, shall be carried out in an objective, proportionate, timely, transparent and non-discriminatory manner. The current state of allocated frequency bands shall be made publicly available, but detailed identification of frequencies allocated for specific government uses is not required.

2. Each Party shall ensure the effective management of radio frequencies for electronic communication services in their territory with a view to ensure effective and efficient use of the spectrum. Where demand for specific frequencies exceeds their availability, appropriate and transparent procedures shall be followed for the assignment of these frequencies in order to optimise their use and facilitate the development of competition.

3. Each Party shall ensure that the assignment of national numbering resources and the management of the national numbering plans are entrusted to the regulatory authority.

4. Where public or local authorities retain ownership or control of suppliers operating public communications networks and/or services, effective structural separation needs to be ensured between the function responsible for granting the rights of way from activities associated with ownership or control.

Article 109

Universal service

1. Each Party has the right to define the kind of universal service obligations it wishes to maintain.

2. Such obligations will not be regarded as anti-competitive per se, provided they are administered in a transparent, objective and non-discriminatory way. The administration of such obligations shall also be neutral with respect to competition and be not more burdensome than necessary for the kind of universal service defined by the Party.

3. Each Party shall ensure that all suppliers should be eligible to ensure universal service and no services supplier shall be a priori excluded. The designation shall be made through an efficient, transparent, objective and non-discriminatory mechanism. Where necessary, each Party shall assess whether the provision of universal service represents an unfair burden on organisation(s) designated to provide universal service. Where justified on the basis of such calculation, and taking into account the market benefit, if any, which accrues to an organisation that offers the universal service, regulatory authorities shall determine whether a mechanism is required to compensate the services supplier(s) concerned or to share the net cost of universal service obligations.

4. Each Party shall ensure that, where directories of all subscribers are available to users, whether printed or electronic, the organisations that provide those directories apply the principle of non-discrimination to the treatment of information that has been provided to them by other organisations.

Article 110

Cross-border provision of electronic communication services

Neither Party may require a service supplier of the other Party to set up an establishment, to establish any form of presence, or to be resident, in its territory as a condition for the cross-border supply of a service.

Article 111

Confidentiality of information

Each Party shall ensure the confidentiality of electronic communications and related traffic data by means of a public communication network and publicly available electronic communication services without restricting trade in services.

Article 112

Disputes between services suppliers

1. Each Party shall ensure that in the event of a dispute arising between suppliers of electronic communication networks or services in connection with rights and obligations referred to in this Section, the regulatory authority concerned shall, at the request of either Party, issue a binding decision to resolve the dispute in the shortest possible timeframe and in any case within four months.

2. The decision of the regulatory authority shall be made available to the public, having regard to the requirements of business confidentiality. The suppliers of electronic communication networks and services concerned shall be given a full statement of the reasons on which it is based.

3. When such a dispute concerns the cross-border provision of services, the regulatory authorities concerned shall co-ordinate their efforts in order to bring about a resolution of the dispute.

Article 113

Gradual approximation

Sub-section 6

Financial services

Article 114

Scope and definitions

1. This Sub-Section sets out the principles of the regulatory framework for all financial services liberalised pursuant to Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter.

(a)

‘financial service’ means any service of a financial nature offered by a financial service supplier of a Party. Financial services comprise the following activities:

(i)

insurance and insurance-related services:

(1)

direct insurance (including co-insurance):

(a)

life;

(b)

non-life;

(2)	reinsurance and retrocession;

(3)	insurance inter-mediation, such as brokerage and agency; and

(4)	services auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services;

(ii)

banking and other financial services (excluding insurance):

(1)	acceptance of deposits and other repayable funds from the public;

(2)	lending of all types, including consumer credit, mortgage credit, factoring and financing of commercial transaction;

(3)	financial leasing;

(4)	all payment and money transmission services, including credit, charge and debit cards, travellers cheques and bankers drafts;

(5)	guarantees and commitments;

(6)

trading for own account or for account of customers, whether on an exchange, in an over-the-counter market or otherwise, the following:

(a)	money market instruments (including cheques, bills, certificates of deposits);

(b)	foreign exchange;

(c)	derivative products including, but not limited to, futures and options;

(d)	exchange rate and interest rate instruments, including products such as swaps, forward rate agreements;

(e)	transferable securities;

(f)	other negotiable instruments and financial assets, including bullion;

(7)	participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;

(8)	money broking;

(9)	asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;

(10)	settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;

(11)	provision and transfer of financial information, and financial data processing and related software;

(12)	advisory, intermediation and other auxiliary financial services on all the activities listed in points (1) through (11), including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy;

(b)	‘financial service supplier’ means any natural or juridical person of a Party that seeks to provide or provides financial services. The term ‘financial service supplier’ does not include a public entity;

(c)

‘public entity’ means:

(i)

a government, a central bank or a monetary authority, of a Party, or an entity owned or controlled by a Party, that is principally engaged in carrying out governmental functions or activities for governmental purposes, not including an entity principally engaged in supplying financial services on commercial terms; or

(ii)	a private entity, performing functions normally performed by a central bank or monetary authority, when exercising those functions;

(d)

‘new financial service’ means a service of a financial nature, including services related to existing and new products or the manner in which a product is delivered, that is not supplied by any financial service supplier in the territory of a Party but which is supplied in the territory of the other Party.

Article 115

Prudential carve-out

1. Each Party may adopt or maintain measures for prudential reasons, such as:

(a)	the protection of investors, depositors, policy-holders or persons to whom a fiduciary duty is owed by a financial service supplier;

(b)	ensuring the integrity and stability of a Party's financial system.

2. Those measures shall not be more burdensome than necessary to achieve their aim, and shall not discriminate against financial service suppliers of the other Party in comparison to its own like financial service suppliers.

3. Nothing in this Agreement shall be construed to require a Party to disclose information relating to the affairs and accounts of individual consumers or any confidential or proprietary information in the possession of public entities.

Article 116

Effective and transparent regulation

1. Each Party shall make its best endeavours to provide in advance to all interested persons any measure of general application that the Party proposes to adopt in order to allow an opportunity for such persons to comment on the measure. Such measure shall be provided:

(a)	by means of an official publication; or

(b)	in other written or electronic form.

2. Each Party shall make available to interested persons its requirements for completing applications relating to the supply of financial services.

On the request of an applicant, the concerned Party shall inform the applicant of the status of its application. If the concerned Party requires additional information from the applicant, it shall notify the applicant without undue delay.

3. Each Party shall make its best endeavours to ensure that internationally agreed standards for regulation and supervision in the financial services sector and for the fight against tax evasion and avoidance are implemented and applied in its territory. Such internationally agreed standards are, inter alia, the Basel Committee's ‘Core Principles for Effective Banking Supervision’, the International Association of Insurance Supervisors' ‘Insurance Core Principles’, the International Organisation of Securities Commissions' ‘Objectives and Principles of Securities Regulation’, the ‘Agreement on Exchange of Information on Tax Matters’ of the Organisation for Economic Co-operation and Development (OECD), the G20 ‘Statement on Transparency and Exchange of Information for Tax Purposes’ and the Financial Action Task Force's ‘Forty Recommendations’ on money laundering and ‘Nine Special Recommendations’ on terrorist financing.

The Parties also take note of the ‘Ten Key Principles for Information Exchange’ promulgated by the G7 Finance Ministers, and will take all steps necessary to try to apply them in their bilateral contacts.

Article 117

New financial services

Each Party shall permit a financial service supplier of the other Party to provide any new financial service of a type similar to those services that the Party would permit its own financial service suppliers to provide under its domestic law in like circumstances. A Party may determine the juridical form through which the service may be provided and may require authorisation for the provision of the service. Where such authorisation is required, a decision shall be made within a reasonable time and the authorisation may only be refused for prudential reasons.

Article 118

Data processing

1. Each Party shall permit a financial service supplier of the other Party to transfer information in electronic or other form, into and out of its territory, for data processing where such processing is required in the ordinary course of business of such financial service supplier.

2. Each Party shall adopt adequate safeguards for the protection of privacy and fundamental rights, and freedom of individuals, in particular with regard to the transfer of personal data.

Article 119

Specific exceptions

1. Nothing in this Chapter shall be construed to prevent a Party, including its public entities, from exclusively conducting or providing in its territory activities or services forming part of a public retirement plan or statutory system of social security, except when those activities may be carried out, as provided by the Party's domestic regulation, by financial service suppliers in competition with public entities or private institutions.

2. Nothing in this Agreement applies to activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary or exchange rate policies.

3. Nothing in this Chapter shall be construed to prevent a Party, including its public entities, from exclusively conducting or providing in its territory activities or services for the account or with the guarantee or using the financial resources of the Party, or its public entities.

Article 120

Self-regulatory organisations

When a Party requires membership or participation in, or access to, any self-regulatory body, securities or futures exchange or market, clearing agency, or any other organization or association, in order for financial service suppliers of the other Party to supply financial services on an equal basis with financial service suppliers of the Party, or when the Party provides directly or indirectly such entities, privileges or advantages in supplying financial services, the Party shall ensure observance of the obligations of Articles 79 and 85 of this Agreement.

Article 121

Clearing and payment systems

Under the terms and conditions that accord national treatment, each Party shall grant to financial service suppliers of the other Party established in its territory access to payment and clearing systems operated by public entities, and to official funding and refinancing facilities available in the normal course of ordinary business. This Article is not intended to confer access to the Party's lender of last resort facilities.

Article 122

Gradual approximation

With a view to considering further liberalisation of trade in services, the Parties recognise the importance of the gradual approximation of the existing and future legislation of Georgia to the international best practices standards listed under Article 116(3) of this Agreement as well as to the list of the Union acquis included in Annex XV-A to this Agreement.

Sub-section 7

Transport services

Article 123

Scope

This Sub-Section sets out the principles regarding the liberalisation of international transport services pursuant to Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter.

Article 124

International maritime transport

1. For the purpose of this Sub-Section and Section 2 (Establishment), Section 3 (Cross-border supply of services) and Section 4 (Temporary presence of natural persons for business purposes) of this Chapter:

(a)

‘international maritime transport’ includes door-to-door and multi-modal transport operations, which is the carriage of goods using more than one mode of transport, involving a sea-leg, under a single transport document, and to this effect the right to directly contract with providers of other modes of transport;

(b)

‘maritime cargo handling services’ means activities exercised by stevedore companies, including terminal operators, but not including direct activities of dockers, when this workforce is organised independently of the stevedoring or terminal operator companies. The activities covered include the organisation and supervision of:

(i)	the loading/discharging of cargo to/from a ship;

(ii)	the lashing/unlashing of cargo;

(iii)

the reception/delivery and safekeeping of cargoes before shipment or after discharge;

(c)

‘customs clearance services’ (alternatively ‘customs house brokers' services’) means activities consisting in carrying out on behalf of another Party customs formalities concerning import, export or through transport of cargoes, whether this service is the main activity of that service provider or a usual complement of the service provider's main activity;

(d)	‘container station and depot services’ means activities consisting in storing containers, whether in port areas or inland, with a view to their stuffing/stripping, repairing and making them available for shipments;

(e)

‘maritime agency services’ means activities consisting in representing, within a given geographic area, as an agent the business interests of one or more shipping lines or shipping companies, for the following purposes:

(i)	marketing and sales of maritime transport and related services, from quotation to invoicing, and issuance of bills of lading on behalf of the companies, acquisition and resale of the necessary related services, preparation of documentation, and provision of business information;

(ii)	acting on behalf of the companies organising the call of the ship or taking over cargoes when required;

(f)	‘freight forwarding services’ means the activity consisting of organising and monitoring shipment operations on behalf of shippers, through the acquisition of transport and related services, preparation of documentation and provision of business information;

(g)	‘feeder services’ means the pre- and onward transportation of international cargoes by sea, notably containerised, between ports located in a Party.

2. As regards international maritime transport, each Party agrees to ensure effective application of the principle of unrestricted access to cargoes on a commercial basis, the freedom to provide international maritime services, as well as national treatment in the framework of the provision of such services.

In view of the existing levels of liberalisation between the Parties in international maritime transport:

(a)	each Party shall apply effectively the principle of unrestricted access to the international maritime markets and trades on a commercial and non-discriminatory basis;

(b)

each Party shall grant to ships flying the flag of the other Party or operated by service suppliers of the other Party treatment no less favourable than that accorded to its own ships or those of any third country, whichever are the better, with regard to, inter alia, access to ports, the use of infrastructure and services of ports, and the use of maritime auxiliary services, as well as related fees and charges, customs facilities and the assignment of berths and facilities for loading and unloading.

3. In applying these principles, each Party shall:

(a)	not introduce cargo-sharing arrangements in future agreements with third countries concerning maritime transport services, including dry and liquid bulk and liner trade, and terminate, within a reasonable period of time, such cargo-sharing arrangements in case they exist in previous agreements; and

(b)

upon the entry into force of this Agreement, abolish and abstain from introducing any unilateral measures and administrative, technical and other obstacles which could constitute a disguised restriction or have discriminatory effects on the free supply of services in international maritime transport.

4. Each Party shall permit international maritime transport service suppliers of the other Party to have an establishment in its territory under conditions of establishment and operation no less favourable than those accorded to its own service suppliers or those of any third country, whichever are the better.

5. Each Party shall make available to maritime transport service suppliers of the other Party on reasonable and non-discriminatory terms and conditions the following services at the port: pilotage, towing and tug assistance, provisioning, fuelling and watering, garbage collecting and ballast waste disposal, port captain's services, navigation aids, shore-based operational services essential to ship operations, including communications, water and electrical supplies, emergency repair facilities, anchorage, berth and berthing services.

6. Each Party shall permit the movement of equipment such as empty containers, not being carried as cargo against payment, between ports of a Member State of the EU or between ports of Georgia.

7. Each Party, subject to the authorisation of the competent authority shall permit international maritime transport service suppliers of the other Party to provide feeder services between their national ports.

Article 125

Air transport

The progressive liberalisation of air transport between the Parties adapted to their reciprocal commercial needs and the conditions of mutual market access are governed by the Common Aviation Area Agreement between the European Union and its Member States, of the one part, and Georgia, of the other part.

Article 126

Gradual approximation

With a view to considering further liberalisation of trade in services, the Parties recognise the importance of the gradual approximation of the existing and future legislation of Georgia to the list of Union acquis included in Annex XV-D to this Agreement.

Section 6

Electronic commerce

Sub-section 1

General provisions

Article 127

Objective and principles

1. The Parties, recognising that electronic commerce increases trade opportunities in many sectors, agree to promote the development of electronic commerce between them, in particular by cooperating on the issues raised by electronic commerce under the provisions of this Chapter.

2. The Parties agree that the development of electronic commerce must be compatible with the international standards of data protection in order to ensure the confidence of users of electronic commerce.

3. The Parties agree that electronic transmissions shall be considered as the provision of services, within the meaning of Section 3 (Cross-border supply of services) of this Chapter, which cannot be subject to customs duties.

Article 128

Cooperation in electronic commerce

1. The Parties shall maintain a dialogue on regulatory issues raised by electronic commerce, which will inter alia address the following issues:

(a)	the recognition of certificates of electronic signatures issued to the public and the facilitation of cross-border certification services;

(b)	the liability of intermediary service providers with respect to the transmission, or storage of information;

(c)	the treatment of unsolicited electronic commercial communications;

(d)	the protection of consumers in the ambit of electronic commerce, and

(e)	any other issue relevant for the development of electronic commerce.

2. Such cooperation can take the form of exchange of information on the Parties' respective legislation on those issues as well as on the implementation of such legislation.

Sub-section 2

Liability of intermediary service providers

Article 129

Use of intermediaries' services

1. The Parties recognise that the services of intermediaries can be used by third parties for infringing activities and shall provide the measures for intermediary service providers as laid down in this Sub-Section (22).

2. For the purposes of Article 130 of this Agreement, ‘service provider’ means a provider of transmission, routing, or connections for digital online communication between or among points specified by the user, of material of the user's choosing without modification of its content. For the purposes of Articles 131 and 132 of this Agreement ‘service provider’ means a provider or operator of facilities for online services or network access.

Article 130

Liability of intermediary service providers: ‘mere conduit’

1. Where an information society service is provided that consists of the transmission in a communication network of information provided by a recipient of the service, or the provision of access to a communication network, each Party shall ensure that the service provider is not liable for the information transmitted, on condition that the provider:

(a)	does not initiate the transmission;

(b)	does not select the receiver of the transmission; and

(c)	does not select or modify the information contained in the transmission.

2. The acts of transmission and of provision of access referred to in paragraph 1 include the automatic, intermediate and transient storage of the information transmitted in so far as this takes place for the sole purpose of carrying out the transmission in the communication network, and provided that the information is not stored for any period longer than is reasonably necessary for the transmission.

3. This Article shall not affect the possibility for a court or administrative authority, in accordance with Parties' legal systems, of requiring the service provider to terminate or prevent an infringement.

Article 131

Liability of intermediary service providers: ‘caching’

1. Where an information society service is provided that consists of the transmission in a communication network of information provided by a recipient of the service, each Party shall ensure that the service provider is not liable for the automatic, intermediate and temporary storage of that information, performed for the sole purpose of making more efficient the information's onward transmission to other recipients of the service upon their request, on condition that:

(a)	the provider does not modify the information;

(b)	the provider complies with conditions on access to the information;

(c)	the provider complies with rules regarding the updating of the information, specified in a manner widely recognised and used by industry;

(d)	the provider does not interfere with the lawful use of technology, widely recognised and used by industry, to obtain data on the use of the information, and

(e)

the provider acts expeditiously to remove or to disable access to the information it has stored upon obtaining actual knowledge (23) of the fact that the information at the initial source of the transmission has been removed from the network, or access to it has been disabled, or that a court or an administrative authority has ordered such removal or disablement.

2. This Article shall not affect the possibility for a court or administrative authority, in accordance with the Parties' legal systems, of requiring the service provider to terminate or prevent an infringement.

Article 132

Liability of intermediary service providers: ‘hosting’

1. Where an information society service is provided that consists of the storage of information provided by a recipient of the service, each Party shall ensure that the service provider is not liable for the information stored at the request of a recipient of the service, on condition that:

(a)	the provider does not have actual knowledge of illegal activity or information and, as regards claims for damages, is not aware of facts or circumstances from which the illegal activity or information is apparent, or

(b)	the provider, upon obtaining such knowledge or awareness, acts expeditiously to remove or to disable access to the information.

2. Paragraph 1 shall not apply when the recipient of the service is acting under the authority or the control of the provider.

3. This Article shall not affect the possibility for a court or administrative authority, in accordance with the Parties' legal systems, of requiring the service provider to terminate or prevent an infringement, nor does it affect the possibility for a Party of establishing procedures governing the removal or disabling of access to information.

Article 133

No general obligation to monitor

1. The Parties shall not impose a general obligation on providers, when providing the services covered by Articles 130, 131 and 132 of this Agreement, to monitor the information which they transmit or store, nor shall they impose a general obligation to actively seek facts or circumstances indicating illegal activity.

2. A Party may establish obligations for information society service providers promptly to inform the competent public authorities of alleged illegal activities undertaken or information provided by recipients of their service or obligations to communicate to the competent authorities, at their request, information enabling the identification of recipients of their service with whom they have storage agreements.

Section 7

Exceptions

Article 134

General exceptions

1. Without prejudice to general exceptions set in Article 415 of this Agreement, the provisions of this Chapter and of Annexes XIV-A and XIV-E, XIV-B and XIV-F, XIV-C and XIV-G, XIV-D and XIV-H to this Agreement are subject to the exceptions contained in this Article.

2. Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail, or a disguised restriction on establishment or cross-border supply of services, nothing in this Chapter shall be construed to prevent the adoption or enforcement by any Party of measures:

(a)	necessary to protect public security or public morals or to maintain public order;

(b)	necessary to protect human, animal or plant life or health;

(c)	relating to the conservation of exhaustible natural resources if such measures are applied in conjunction with restrictions on domestic entrepreneurs or on the domestic supply or consumption of services;

(d)	necessary for the protection of national treasures of artistic, historic or archaeological value;

(e)

necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Chapter, including those relating to:

(i)	the prevention of deceptive and fraudulent practices or to deal with the effects of a default on contracts;

(ii)	the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts;

(iii)

safety;

(f)	inconsistent with Articles 79 and 85 of this Agreement, provided that the difference in treatment is aimed at ensuring the effective or equitable imposition or collection of direct taxes in respect of economic activities, entrepreneurs or services suppliers of the other Party (24).

3. The provisions of this Chapter and of Annexes XIV-A and XIV-E, XIV-B and XIV-F, XIV-C and XIV-G, XIV-D and XIV-H to this Agreement shall not apply to the Parties' respective social security systems or to activities in the territory of each Party, which are connected, even occasionally, with the exercise of official authority.

Article 135

Taxation measures

The most-favoured-nation treatment granted in accordance with the provisions of this Chapter shall not apply to the tax treatment that Parties are providing or will provide in future on the basis of agreements between the Parties designed to avoid double taxation.

Article 136

Security exceptions

1. Nothing in this Agreement shall be construed:

(a)	to require any Party to furnish any information, the disclosure of which it considers contrary to its essential security interests;

(b)

to prevent any Party from taking any action which it considers necessary for the protection of its essential security interests:

(i)	connected with the production of or trade in arms, munitions or war matèriel;

(ii)	relating to economic activities carried out directly or indirectly for the purpose of provisioning a military establishment;

(iii)

relating to fissionable and fusionable materials or the materials from which they are derived; or

(iv)	taken in time of war or other emergency in international relations; or

(c)	to prevent any Party from taking any action in pursuance of obligations it has accepted for the purpose of maintaining international peace and security.

CHAPTER 7

Current payments and movement of capital

Article 137

Current payments

The Parties undertake to impose no restrictions and shall allow, in freely convertible currency, in accordance with the provisions of Article VIII of the Agreement of the International Monetary Fund, any payments and transfers on the current account of balance of payments between the Parties.

Article 138

Capital movements

1. With regard to transactions on the capital and financial account of balance of payments, from the entry into force of this Agreement, the Parties shall ensure the free movement of capital relating to direct investments, including the acquisition of real estate, made in accordance with the laws of the host country, investments made in accordance with the provisions of Chapter 6 (Establishment, Trade in Services and Electronic Commerce) of Title IV (Trade and Trade-related Matters) of this Agreement and the liquidation or repatriation of invested capital and of any profit stemming therefrom.

2. With regard to transactions on the capital and financial account of balance of payments other than the transactions listed in paragraph 1 of this Article, from the entry into force of this Agreement, each Party shall ensure without prejudice to other provisions of this Agreement:

(a)	the free movement of capital relating to credits for commercial transactions or for the provision of services in which a resident of one of the Parties is participating;

(b)	the free movement of capital relating to portfolio investments, financial loans and credits by the investors of the other Party.

Article 139

Safeguard measures

Where, in exceptional circumstances, payments or movements of capital cause, or threaten to cause, serious difficulties for the operation of exchange rate policy or monetary policy, including serious balance of payments difficulties, in one or more Member States or in Georgia, the Parties concerned may take safeguard measures for a period not exceeding six months if such measures are strictly necessary. The Party adopting the safeguard measure shall inform the other Party forthwith of the adoption of any safeguard measure and, as soon as possible, of a time schedule for its removal.

Article 140

Facilitation and evolution provisions

1. The Parties shall consult with a view to facilitating the movement of capital between the Parties in order to promote the objectives of this Agreement.

2. During the first four years following the date of entry into force of this Agreement, the Parties shall take measures permitting the creation of the necessary conditions for further gradual application of the Union rules on the free movement of capital.

3. By the end of the fifth year following the date of entry into force of this Agreement, the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, shall review the measures taken and determine the modalities for further liberalisation.

CHAPTER 8

Public procurement

Article 141

Objectives

1. The Parties recognise the contribution of transparent, non-discriminatory, competitive and open tendering to sustainable economic development and set as their objective the effective, reciprocal and gradual opening of their respective procurement markets.

2. This Chapter envisages mutual access to public procurement markets on the basis of the principle of national treatment at national, regional and local level for public contracts and concessions in the traditional sector as well as in the utilities sector. It provides for a gradual approximation of the public procurement legislation in Georgia with the Union public procurement acquis based on the principles governing public procurement in the Union and the terms and definitions set out in Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (Directive 2004/18/EC) and Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors (Directive 2004/17/EC).

Article 142

Scope

1. This Chapter applies to works, supplies and services public contracts, as well as works, supplies and services contracts in the utilities sectors and, if and where such contracts are used, to works and services concessions.

2. This Chapter applies to any contracting authority and any contracting entity which meets the definitions of the Union public procurement acquis (hereinafter referred to as ‘the contracting entities’). It covers also bodies governed by public law and public undertakings in the field of utilities such as state-owned enterprises carrying out the relevant activities and private undertakings operating on the basis of special and exclusive rights in the field of utilities (25).

3. This Chapter applies to contracts above the value thresholds set out in Annex XVI-A to this Agreement.

4. The calculation of the estimated value of a public contract shall be based on the total amount payable, net of taxes on value added. When applying these thresholds, Georgia shall calculate and convert contract values into its national currency, using the conversion rate of its national bank.

5. Value thresholds shall be revised regularly every two years, beginning in the year of entry into force of this Agreement, based on the average daily value of the euro, expressed in Special Drawing Rights, over the 24 months terminating on the last day of August preceding the revision with effect from January 1. The value of the thresholds thus revised shall, where necessary, be rounded down to nearest thousand euro. The revision of the thresholds shall be adopted by the decision of the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

Article 143

Institutional background

1. Each Party shall establish or maintain an appropriate institutional framework and mechanisms necessary for the proper functioning of the public procurement system and the implementation of the principles in this Chapter.

2. Georgia shall designate in particular:

(a)

an executive body at central government level tasked with guaranteeing a coherent policy and its implementation in all areas related to public procurement. That body shall facilitate and coordinate the implementation of this Chapter and guide the process of gradual approximation to the Union acquis, as set out in Annex XVI-B to this Agreement;

(b)

an impartial and independent body tasked with the review of decisions taken by contracting authorities or entities during the award of contracts. In this context, ‘independent’ means that that body shall be a public authority which is separate from all contracting entities and economic operators. There shall be a possibility to subject the decisions taken by this body to judicial review.

3. Each Party shall ensure that decisions taken by the authorities responsible for the review of complaints by economic operators concerning infringements of domestic law shall be effectively enforced.

Article 144

1. No later than three years from the entry into force of this Agreement, the Parties shall comply with a set of basic standards for the award of all contracts as stipulated in paragraphs 2 to 15 of this Article. These basic standards derive directly from the rules and principles of public procurement, as regulated in the Union public procurement acquis, including the principles of non-discrimination, equal treatment, transparency and proportionality.

2. Each Party shall ensure that all intended procurements are published in an appropriate media (26) in a manner that is sufficient:

(a)	to enable the market to be opened up to competition; and

(b)	to allow any interested economic operator to have appropriate access to information regarding the intended procurement prior to the award of the contract and to express its interest in obtaining the contract.

3. The publication shall be appropriate to the economic interest of the contract to economic operators.

4. The publication shall contain at least the essential details of the contract to be awarded, the criteria for qualitative selection, the award method, the contract award criteria and any other additional information that the economic operators reasonably need to decide whether to express their interest in obtaining the contract.

5. All contracts shall be awarded through transparent and impartial award procedures that prevent corruptive practices. This impartiality shall be ensured in particular through the non-discriminatory description of the subject matter of the contract, equal access for all economic operators, appropriate time-limits and a transparent and objective approach.

6. When describing the characteristics of the required work, supply or service, the contracting entities shall use general descriptions of performance and functions and international, European or national standards.

7. The description of the characteristics required of a work, supply or service shall not refer to a specific make or source, or a particular process, or to trademarks, patents, types or a specific origin or production unless such a reference is justified by the subject matter of the contract and accompanied by the words ‘or equivalent’. Preference shall be given to the use of general descriptions of performance or functions.

8. Contracting entities shall not impose conditions resulting in direct or indirect discrimination against the economic operators of the other Party, such as the requirement that economic operators interested in the contract must be established in the same country, region or territory as the contracting entity.

Notwithstanding the above, in cases where it is justified by the specific circumstances of the contract, the successful applicant may be required to establish certain business infrastructure at the place of performance.

9. The time-limits for expression of interest and for submission of offers shall be sufficiently long to allow economic operators from the other Party to make a meaningful assessment of the tender and prepare their offer.

10. All participants must be able to know the applicable rules, selection criteria and award criteria in advance. Those rules must apply equally to all participants.

11. Contracting entities may invite a limited number of applicants to submit an offer, provided that:

(a)	this is done in a transparent and non-discriminatory manner; and

(b)	the selection is based only on objective factors such as the experience of the applicants in the sector concerned, the size and infrastructure of their businesses or their technical and professional abilities.

In inviting a limited number of applicants to submit an offer, account shall be taken of the need to ensure adequate competition.

12. Contracting entities may use negotiated procedures only in exceptional and defined cases when the use of such a procedure effectively does not distort competition.

13. Contracting entities may use qualification systems only under the condition that the list of qualified operators is compiled by means of a sufficiently advertised, transparent and open procedure. Contracts falling within the scope of such a system shall be awarded also on a non-discriminatory basis.

14. Each Party shall ensure that contracts are awarded in a transparent manner to the applicant who has submitted the economically most advantageous offer or the offer with the lowest price, based on the tender criteria and the procedural rules established and communicated in advance. The final decisions shall be communicated to all applicants without undue delay. Upon request of an unsuccessful applicant, reasons must be provided in sufficient detail to allow the review of such a decision.

15. Each Party shall ensure that any person having or having had an interest in obtaining a particular contract and who has been, or risks, being harmed by an alleged infringement is entitled to effective, impartial judicial protection against any decision of the contracting entity related to the award of that contract. The decisions taken in the course and at the end of such review procedure shall be made public in a manner that is sufficient to inform all interested economic operators.

Article 145

Planning of gradual approximation

1. Prior to the commencement of gradual approximation, Georgia shall submit to the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, a comprehensive roadmap for the implementation of this Chapter with time schedules and milestones which shall include all reforms in terms of approximation to the Union acquis and institutional capacity building. This roadmap shall comply with the phases and time schedules set out in Annex XVI-B to this Agreement.

2. Following a favourable opinion by the Association Committee in Trade configuration, the roadmap shall be considered as the reference document for the implementation of this Chapter. The Union shall make its best efforts in assisting Georgia in the implementation of the roadmap.

Article 146

Gradual approximation

1. Georgia shall ensure that its legislation on public procurement will be gradually approximated to the Union's public procurement acquis.

2. Approximation to the Union acquis shall be carried out in consecutive phases as set out in the schedule in Annex XVI-B to this Agreement and further specified in Annexes XVI-C to XVI-F, XVI-H, XVI-I, and XVI-K thereto. Annexes XVI-G and XVI-J to this Agreement identify non-mandatory elements that need not be approximated, whereas Annexes XVI-L to XVI-O to this Agreement identify elements of the Union acquis that remain outside the scope of approximation. In this process, due account shall be taken of the corresponding case law of the Court of Justice of the European Union and the implementing measures adopted by the European Commission as well as, should it become necessary, of any modifications of the Union acquis occurring in the meantime. The implementation of each phase shall be evaluated by the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement, and, following a positive assessment by that Committee, be linked to the reciprocal granting of market access as set out in Annex XVI-B to this Agreement. The European Commission shall notify Georgia without undue delay of any modifications of the Union acquis. It shall, upon request, provide appropriate advice and technical assistance for the purpose of implementing such modifications.

3. The Association Committee in Trade configuration shall only proceed to the evaluation of a next phase once the measures to implement the previous phase have been carried out and approved in accordance with the modalities set out in paragraph 2.

4. Each Party shall ensure that those aspects and areas of public procurement which are not covered by this Article comply with the principles of transparency, non-discrimination and equal treatment as set out under Article 144 of this Agreement.

Article 147

Market access

1. The Parties agree that the effective and reciprocal opening of their respective markets shall be attained gradually and simultaneously. During the process of approximation, the extent of the market access mutually granted shall be linked to the progress made in this process as stipulated in Annex XVI-B to this Agreement.

2. The decision to proceed to a further phase of market opening shall be made on the basis of an assessment of the compliance of the legislation adopted with the Union acquis as well as its practical implementation. Such assessment shall be carried out regularly by the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

3. In so far as a Party has, in accordance with Annex XVI-B to this Agreement, opened its procurement market to the other Party:

(a)	the Union shall grant access to contract award procedures to Georgian companies, whether established or not in the Union, pursuant to the Union public procurement rules under treatment no less favourable than that accorded to Union companies;

(b)	Georgia shall grant access to contract award procedures for Union companies, whether established or not in Georgia, pursuant to national procurement rules under treatment no less favourable than that accorded to Georgian companies.

4. After the implementation of the last phase in the process of approximation, the Parties will examine the possibility to mutually grant market access with regard to procurement below the value thresholds set out in Annex XVI-A to this Agreement.

5. Finland reserves its position with regard to the Åland Islands.

Article 148

Information

1. Each Party shall ensure that contracting entities and economic operators are appropriately informed about public procurement procedures, including through the publication of all relevant legislation and administrative rulings.

2. Each Party shall ensure the effective dissemination of information on tendering opportunities.

Article 149

Cooperation

1. The Parties shall enhance their cooperation through exchanges of experience and information relating to their best practices and regulatory frameworks.

2. The Union shall facilitate the implementation of this Chapter, including through technical assistance where appropriate. In line with the provisions on financial cooperation in Title VII (Financial Assistance, and Anti-fraud and Control Provisions) of this Agreement, specific decisions on financial assistance shall be taken through the relevant Union funding mechanisms and instruments.

3. An indicative list of issues for cooperation is included in Annex XVI-P to this Agreement.

CHAPTER 9

Intellectual property rights

Section 1

General provisions

Article 150

Objectives

The objectives of this Chapter are to:

(a)	facilitate the production and commercialisation of innovative and creative products between the Parties; and

(b)	achieve an adequate and effective level of protection and enforcement of intellectual property rights.

Article 151

Nature and scope of obligations

1. The Parties shall ensure the adequate and effective implementation of the international treaties dealing with intellectual property to which they are parties including the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement). The provisions of this Chapter shall complement and further specify the rights and obligations between the Parties under the TRIPS Agreement and other international treaties in the field of intellectual property.

2. For the purposes of this Agreement, the expression ‘intellectual property’ refers at least to all categories of intellectual property that are covered by Articles 153 to 189 of this Agreement.

3. Protection of intellectual property includes protection against unfair competition as referred to in Article 10bis of the Paris Convention for the Protection of Industrial Property of 1967 (Paris Convention).

Article 152

Exhaustion

Each Party shall provide for a regime of domestic or regional exhaustion of intellectual property rights.

Section 2

Standards concerning intellectual property rights

Sub-section 1

Article 153

Protection granted

The Parties reaffirm their commitment to:

(a)	the rights and obligations set out in the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention);

(b)	the International Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations of 1961;

(c)	the TRIPS Agreement;

(d)	the WIPO Copyright Treaty;

(e)	the WIPO Performances and Phonograms Treaty.

Article 154

Authors

Each Party shall provide for authors the exclusive right to authorise or prohibit:

(a)	the direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part of their works;

(b)	any form of distribution to the public by sale or otherwise of the original of their works or of copies thereof;

(c)	any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.

Article 155

Performers

Each Party shall provide for performers the exclusive right to:

(a)	authorise or prohibit the fixation (27) of their performances;

(b)	authorise or prohibit the direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part, of fixations of their performances;

(c)	make available to the public, by sale or otherwise, fixations of their performances;

(d)	authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them, of fixations of their performances;

(e)	authorise or prohibit the broadcasting by wireless means and the communication to the public of their performances, except where the performance is itself already a broadcast performance or is made from a fixation.

Article 156

Producers of phonograms

Each Party shall provide for phonogram producers the exclusive right to:

(a)	authorise or prohibit the direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part, of their phonograms;

(b)	make available to the public, by sale or otherwise, their phonograms, including copies thereof;

(c)	authorise or prohibit the making available of their phonograms to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.

Article 157

Broadcasting organisations

Each Party shall provide for broadcasting organisations the exclusive right to authorise or prohibit:

(a)	the fixation of their broadcasts;

(b)	the reproduction of fixations of their broadcasts;

(c)	the making available to the public, by wire or wireless means, of fixations of their broadcasts; and

(d)	the rebroadcasting of their broadcasts by wireless means, as well as the communication to the public of their broadcasts if such communication is made in places accessible to the public against payment of an entrance fee.

Article 158

Broadcasting and communication to the public

1. Each Party shall provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public, and to ensure that this remuneration is shared between the relevant performers and phonogram producers.

2. Each Party may, in the absence of agreement between the performers and phonogram producers, lay down the conditions as to the sharing of this remuneration between them.

Article 159

Term of protection

1. The rights of an author of a literary or artistic work within the meaning of Article 2 of the Berne Convention shall run for the life of the author and for 70 years after his/her death, irrespective of the date when the work is lawfully made available to the public.

2. The term of protection of a musical composition with words shall expire 70 years after the death of the last of the following persons to survive, whether or not those persons are designated as co-authors: the author of the lyrics and the composer of the musical composition, provided that both contributions were specifically created for the respective musical composition with words.

3. The rights of performers shall expire no less than 50 years after the date of the performance. However:

(a)	if a fixation of the performance otherwise than in a phonogram is lawfully published or lawfully communicated to the public within this period, the rights shall expire 50 years from the date of the first such publication or the first such communication to the public, whichever is the earlier,

(b)	if a fixation of the performance in a phonogram is lawfully published or lawfully communicated to the public within this period, the rights shall expire 70 years from the date of the first such publication or the first such communication to the public, whichever is the earlier.

4. The rights of producers of phonograms shall expire no less than 50 years after the fixation is made. However:

(a)

if a phonogram has been lawfully published within this period, the said rights shall expire no less than 70 years from the date of the first lawful publication. If no lawful publication has taken place within the period mentioned in the first sentence, and if the phonogram has been lawfully communicated to the public within this period, the said rights shall expire not less than 70 years from the date of the first lawful communication to the public;

(b)

if 50 years after a phonogram is lawfully published or communicated to the public, the phonogram producer does not offer copies of the phonogram for sale in sufficient quantity, or does not make it available to the public, the performer may terminate the contract by which he/she has transferred or assigned his/her rights in the fixation of his/her performance to a phonogram producer.

5. The rights of broadcasting organisations shall expire no less than 50 years after the first transmission of a broadcast, whether this broadcast is transmitted by wire or wireless means, including by cable or satellite.

6. The terms laid down in this Article shall be calculated from the first of January of the year following the event which gives rise to them.

Article 160

Protection of technological measures

1. Each Party shall provide adequate legal protection against the circumvention of any effective technological measures, which the person concerned carries out in the knowledge, or with reasonable grounds to know, that he or she is pursuing that objective.

2. Each Party shall provide adequate legal protection against the manufacture, import, distribution, sale, rental, advertisement for sale or rental, or possession for commercial purposes of devices, products or components, or the provision of services which:

(a)	are promoted, advertised or marketed for the purpose of circumvention of any effective technological measures;

(b)	have only a limited commercially significant purpose or use other than to circumvent any effective technological measures, or

(c)	are primarily designed, produced, adapted or performed for the purpose of enabling or facilitation the circumvention of any effective technological measures.

3. For the purposes of this Agreement, the expression ‘technological measures’ means any technology, device or component that, in the normal course of its operation, is designed to prevent or restrict acts, in respect of works or other protected subject matter, which are not authorised by the right holder of any copyright or related right as provided for by domestic law. Technological measures shall be deemed ‘effective’ where the use of a work or other protected subject matter is controlled by the right holders through application of an access control or protection process, such as encryption, scrambling or other transformation of the work or other subject matter or a copy control mechanism, which achieves the protection objective.

Article 161

Protection of rights management information

1. Each Party shall provide adequate legal protection against any person performing without authority any of the following acts:

(a)	the removal or alteration of any electronic rights-management information, or

(b)	the distribution, importation for distribution, broadcasting, communication or making available to the public of works or other subject matter protected under this Agreement from which electronic rights-management information has been removed or altered without authority,

if such person knows, or has reasonable grounds to know, that by so doing he/she is inducing, enabling, facilitating or concealing an infringement of any copyright or any related rights as provided by domestic law.

2. For the purposes of this Chapter, the expression ‘rights-management information’ means any information provided by a right holder that identifies the work or other subject matter that is the object of protection under this Chapter, the author or any other right holder, or information about the terms and conditions of use of the work or other subject matter, and any numbers or codes that represent such information. Paragraph 1 shall apply when any of these items of information is associated with a copy of, or appears in connection with the communication to the public of, a work or other subject matter that is the object of protection under this Chapter.

Article 162

Exceptions and limitations

1. In accordance with the conventions and international treaties to which they are Parties, each Party may provide for limitations or exceptions to the rights set out in Articles 154 to 159 of this Agreement only in certain special cases which do not conflict with a normal exploitation of the protected subject matter and which do not unreasonably prejudice the legitimate interests of the right holders.

2. Each Party shall provide that temporary acts of reproduction referred to in Articles 155 to 158 of this Agreement, which are transient or incidental, which are an integral and essential part of a technological process and the sole purpose of which is to enable:

(a)	a transmission in a network between third parties by an intermediary, or

(b)	a lawful use of a work or other protected subject matter to be made, and which have no independent economic significance, shall be exempted from the reproduction right provided for in Articles 155 to 158 of this Agreement.

Article 163

Artists' resale right in works of art

1. Each Party shall provide, for the benefit of the author of an original work of art, a resale right, to be defined as an inalienable right, which cannot be waived, even in advance, to receive a royalty based on the sale price obtained for any resale of the work, subsequent to the first transfer of the work by the author.

2. The right referred to in paragraph 1 shall apply to all acts of resale involving as sellers, buyers or intermediaries art market professionals, such as salesrooms, art galleries and, in general, any dealers in works of art.

3. Each Party may provide that the right referred to in paragraph 1 shall not apply to acts of resale where the seller has acquired the work directly from the author less than three years before that resale and where the resale price does not exceed a certain minimum amount.

4. The royalty shall be payable by the seller. Each Party may provide that one of the natural or legal persons referred to in paragraph 2 other than the seller shall alone be liable or shall share liability with the seller for payment of the royalty.

5. The protection provided may be claimed to the extent permitted by the Party where this protection is claimed. The procedure for collection and the amounts shall be matters for determination by domestic law.

Article 164

Cooperation on collective management of rights

The Parties shall endeavour to promote dialogue and cooperation between their respective collective management societies for the purpose of promoting the availability of works and other protected subject matter and the transfer of royalties for the use of such works or other protected subject matter.

Sub-section 2

Trademarks

Article 165

International agreements

The Parties reaffirm their commitment to:

(a)	the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks, and

(b)	the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks.

Article 166

Registration procedure

1. Each Party shall provide for a system for the registration of trademarks in which each final negative decision taken by the relevant trademark administration shall be communicated to the applicant in writing and shall be duly reasoned.

2. Each Party shall provide for the possibility to oppose applications to register trademarks. Such opposition proceedings shall be adversarial.

3. The Parties shall provide a publicly available electronic database of applications and registrations of trademarks.

Article 167

Well-known trademarks

Each Party shall give effect to Article 6bis of the Paris Convention and Article 16(2) and (3) of the TRIPS Agreement concerning the protection of well-known trademarks, and may take into consideration the Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks adopted by the Assembly of the Paris Union for the Protection of Industrial Property and the General Assembly of the World Intellectual Property Organisation (WIPO) at the Thirty-Fourth Series of Meetings of the Assemblies of the Member States of WIPO (September 1999).

Article 168

Exceptions to the rights conferred by a trademark

Each Party shall provide for limited exceptions to the rights conferred by a trademark, such as the fair use of descriptive terms, the protection of geographical indications as provided for in Article 176, or other limited exceptions that take account of the legitimate interests of the owner of the trademark and of third parties.

Sub-section 3

Geographical indications

Article 169

Scope

1. This Sub-Section applies to the recognition and protection of geographical indications which are originating in the territories of the Parties.

2. In order for a geographical indication of a Party to be protected by the other Party, it shall cover products within the scope of the legislation of that Party referred to in Article 170 of this Agreement.

Article 170

Established geographical indications

1. Having examined the Law of Georgia on appellations of origin and Geographical Indications of Goods, adopted on 22 August 1999, the Union concludes that that law meets the elements laid down in Annex XVII-A to this Agreement.

2. Having examined Council Regulation (EEC) No 1601/91 of 10 June 1991 laying down general rules on the definition, description and presentation of aromatised wines, aromatized wine-based drinks and aromatized wine-product cocktails, Council Regulation (EC) No 510/2006 of 20 March 2006 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs, with its implementing rules, for the registration, control and protection of geographical indications of agricultural products and foodstuffs in the European Union, Section I of Chapter I of Title II of Part II of Council Regulation (EC) No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (Single CMO Regulation) and Regulation (EC) No 110/2008 of the European Parliament and of the Council of 15 January 2008 on the definition, description, presentation, labelling and the protection of geographical indications of spirit drinks, Georgia concludes that those laws, rules and procedures meet the elements laid down in Annex XVII-A to this Agreement.

3. Georgia, after having completed an objection procedure in accordance with the criteria set in Annex XVII-B to this Agreement, having examined a summary of the specifications of the agricultural products and foodstuffs corresponding to the geographical indications of the Union listed in Annex XVII-C to this Agreement and the geographical indications for wines, aromatised wines and spirit drinks listed in Annex XVII-D to this Agreement, which have been registered by the Union under the legislation referred to in paragraph 2 of this Article, shall protect those geographical indications according to the level of protection laid down in this Sub-section.

4. The Union, after having completed an objection procedure in accordance with the criteria set out in Annex XVII-B to this Agreement, having examined a summary of the specifications of the agricultural products and foodstuffs corresponding to the geographical indications of Georgia listed in Annex XVII-C to this Agreement and the geographical indications for wines, aromatised wines and spirit drinks listed in Annex XVII-D to this Agreement, which are registered by Georgia under the legislation referred to in paragraph 1, shall protect those geographical indications according to the level of protection laid down in this Sub-Section.

5. The decisions of the Joint Committee set up by Article 11 of the Agreement between the European Union and Georgia on protection of geographical indications of agricultural products and foodstuffs concerning the amendment of Annexes III and IV to that Agreement, which are taken before the entry into force of this Agreement, shall be deemed to be decisions of the Geographical Indications Sub-Committee, and the geographical indications added to Annexes III and IV to that Agreement shall be deemed to be part of Annexes XVII-C and XVII-D of this Agreement. Accordingly, the Parties shall protect those geographical indications as established geographical indications under this Agreement.

Article 171

Addition of new geographical indications

1. The Parties agree on the possibility to add new geographical indications to be protected in Annexes XVII-C and XVII-D to this Agreement in accordance with the procedure set out in Article 179(3) of this Agreement after having completed the objection procedure and after having examined a summary of the specifications as referred to in Article 170(3) and (4) of this Agreement to the satisfaction of both Parties.

2. A Party shall not be required to protect as a geographical indication a name that conflicts with the name of a plant variety or an animal breed and as a result is likely to mislead the consumer as to the true origin of the product.

Article 172

Scope of protection of geographical indications

1. The geographical indications listed in Annexes XVII-C and XVII-D to this Agreement, as well as those added pursuant to Article 171 of this Agreement, shall be protected against:

(a)

any direct or indirect commercial use of a protected name:

(i)	for comparable products not compliant with the product specification of the protected name, or

(ii)	in so far as such use exploits the reputation of a geographical indication;

(b)	any misuse, imitation or evocation (28), even if the true origin of the product is indicated or if the protected name is translated or accompanied by an expression such as ‘style’, ‘type’, ‘method’, ‘as produced in’, ‘imitation’, ‘flavour’, ‘like’ or similar;

(c)

any other false or misleading indication as to the provenance, origin, nature or essential qualities of the product, on the inner or outer packaging, advertising material or documents relating to the product concerned, and the packing of the product in a container liable to convey a false impression as to its origin;

(d)	any other practice liable to mislead the consumer as to the true origin of the product.

2. If geographical indications are wholly or partially homonymous, protection shall be granted to each indication provided that it has been used in good faith and with due regard for local and traditional usage and the actual risk of confusion. Without prejudice to Article 23 of the TRIPS Agreement, the Parties shall mutually decide the practical conditions of use under which the homonymous geographical indications will be differentiated from each other, taking into account the need to ensure equitable treatment of the producers concerned and that consumers are not misled. A homonymous name which misleads the consumer into believing that products come from another territory shall not be registered even if the name is accurate as far as the actual territory, region or place of origin of the product in question is concerned.

3. Where a Party, in the context of negotiations with a third country, proposes to protect a geographical indication of that third country, and the name is homonymous with a geographical indication of the other Party, the latter shall be informed and be given the opportunity to comment before the name becomes protected.

4. Nothing in this Sub-Section shall oblige a Party to protect a geographical indication of the other Party which is not or ceases to be protected in its country of origin. The Parties shall notify each other if a geographical indication ceases to be protected in its country of origin.

Article 173

Protection of transcription of geographical indications

1. Geographical indications protected under this Sub-Section in the characters of the Georgian alphabet and other non-Latin alphabets officially used in the Member States shall be protected together with their transcription in Latin characters. This transcription may also be used for labelling purposes for the products concerned.

2. Similarly, geographical indications protected under this Sub-Section in a Latin alphabet shall be protected together with their transcription in the characters of the Georgian alphabet and in the characters of other non-Latin alphabets officially used in the Member States. This transcription may also be used for labelling purposes for the products concerned.

Article 174

Right of use of geographical indications

1. A name protected under this Sub-Section may be used by any operator marketing agricultural products, foodstuffs, wines, aromatised wines or spirit drinks conforming to the corresponding specification.

2. Once a geographical indication is protected under this Sub-Section, the use of such protected name shall not be subject to any registration of users or further charges.

Article 175

Enforcement of protection

The Parties shall enforce the protection provided for in Articles 170 to 174 of this Agreement by appropriate administrative action by their public authorities. They shall also enforce such protection at the request of an interested party.

Article 176

Relationship with trademarks

1. The Parties shall refuse to register or shall invalidate, ex officio or at the request of any interested party in conformity with the legislation of each Party, a trademark that corresponds to any of the situations referred to in Article 172(1) of this Agreement in relation to a protected geographical indication for like products, provided an application to register the trademark is submitted after the date of application for protection of the geographical indication in the territory concerned.

2. For geographical indications referred to in Article 170 of this Agreement, the date of application for protection shall be 1 April 2012.

3. For geographical indications referred to in Article 171 of this Agreement, the date of application for protection shall be the date of the transmission of a request to the other Party to protect a geographical indication.

4. The Parties shall have no obligation to protect a geographical indication where, in the light of a reputed or well-known trademark, protection is liable to mislead consumers as to the true identity of the product.

5. Without prejudice to paragraph 4, the Parties shall protect geographical indications also where a prior trademark exists. A prior trademark shall mean a trademark the use of which corresponds to one of the situations referred to in Article 172(1) of this Agreement, which has been applied for, registered or established by use, if that possibility is provided for by the legislation concerned, in the territory of one of the Parties before the date on which the application for protection of the geographical indication is submitted by the other Party under this Sub-Section. Such trademark may continue to be used and renewed notwithstanding the protection of the geographical indication, provided that no grounds for the trademark's invalidity or revocation exist in the legislation on trademarks of the Parties.

Article 177

General rules

1. This Sub-Section shall apply without prejudice to the rights and obligations of the Parties under the WTO Agreement.

2. The import, export and marketing of any product referred to in Articles 170 and 171 of this Agreement shall be conducted in compliance with the laws and regulations applying in the territory of the importing Party.

3. Any matter arising from technical specifications of registered names shall be dealt with in the Sub-Committee established in Article 179 of this Agreement.

4. Geographical indications protected under this Sub-Section may only be cancelled by the Party in which the product originates.

5. A product specification referred to in this Sub-Section shall be that approved, including any amendments also approved, by the authorities of the Party in the territory of which the product originates.

Article 178

Cooperation and transparency

1. The Parties shall, either directly or through the Geographical Indications Sub-Committee established pursuant to Article 179 of this Agreement, maintain contact on all matters relating to the implementation and the functioning of this Sub-Section. In particular, a Party may request from the other Party information relating to product specifications and their modification, and contact points for control provisions.

2. Each Party may make publicly available the specifications or a summary thereof and contact points for control provisions corresponding to geographical indications of the other Party protected pursuant to this Article.

Article 179

Geographical Indications Sub-Committee

1. The Geographical Indications Sub-Committee is hereby established. It shall consist of representatives of the Union and of Georgia with the purpose of monitoring the development of this Sub-Section and of intensifying their cooperation and dialogue on geographical indications. It shall report to the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

2. The Geographical Indications Sub-Committee adopts its decisions by consensus. It shall determine its own rules of procedure. It shall meet at the request of either of the Parties, alternatively in the EU and in Georgia, at a time and a place and in a manner (which may include by videoconference) mutually determined by the Parties, but no later than 90 days after the request.

3. The Geographical Indications Sub-Committee shall also see to the proper functioning of this Sub-Section and may consider any matter related to its implementation and operation. In particular, it shall be responsible for:

(a)	amending Article 170(1) and (2) of this Agreement, as regards the references to the law applicable in the Parties;

(b)	modifying Annexes XVII-C and XVII-D to this Agreement as regards geographical indications;

(c)	exchanging information on legislative and policy developments on geographical indications and any other matter of mutual interest in the area of geographical indications;

(d)	exchanging information on geographical indications for the purpose of considering their protection in accordance with this Sub-Section.

Sub-section 4

Designs

Article 180

International agreements

The Parties reaffirm their commitment to the Geneva Act to the Hague Agreement Concerning the International Registration of Industrial Designs of 1999.

Article 181

Protection of registered designs

1. Each Party shall provide for the protection of independently created designs that are new and are original (29). This protection shall be provided by registration, which shall confer an exclusive right upon the holder of a registered design in accordance with the provisions of this Article.

2. A design applied to or incorporated in a product which constitutes a component part of a complex product shall only be considered to be new and original:

(a)	if the component part, once it has been incorporated into the complex product, remains visible during normal use of the latter, and

(b)	to the extent that those visible features of the component part fulfil in themselves the requirements as to novelty and originality.

3. The expression ‘normal use’ in point (a) of paragraph 2 shall mean use by the end user, excluding maintenance, servicing or repair work.

4. The holder of a registered design shall have the right to prevent third parties not having the owner's consent from, at a minimum, making, offering for sale, selling, importing, exporting, stocking or using a product bearing or embodying the protected design when such acts are undertaken for commercial purposes, unduly prejudice the normal exploitation of the design, or are not compatible with fair trade practices.

5. The duration of protection available shall amount to 25 years, from the date of filing of the application for registration or from a date established in accordance with the Hague Agreement Concerning the International Deposit of Industrial Designs, without prejudice to the Paris Convention.

Article 182

Exceptions and exclusions

1. Each Party may provide limited exceptions to the protection of designs, provided that such exceptions do not unreasonably conflict with the normal exploitation of protected designs and do not unreasonably prejudice the legitimate interests of the owner of the protected design, taking account of the legitimate interests of third parties.

2. Design protection shall not extend to designs dictated essentially by technical or functional considerations. In particular a design right shall not subsist in features of appearance of a product which are required to be reproduced in their exact form and dimensions in order to permit the product in which the design is incorporated or to which it is applied to be mechanically connected to or placed in, around or against another product so that either product may perform its function.

Article 183

Relationship to copyright

A design shall also be eligible for protection under the law of copyright of a Party as from the date on which the design was created or fixed in any form. The extent to which, and the conditions under which, such a protection is conferred, including the level of originality required, shall be determined by each Party.

Sub-section 5

Patents

Article 184

International agreements

The Parties reaffirm their commitment to the WIPO Patent Cooperation Treaty.

Article 185

Patents and public health

1. The Parties recognise the importance of the Declaration of the Ministerial Conference of the WTO on the TRIPS Agreement and Public Health adopted on 14 November 2001.

2. The Parties shall respect the Decision of the WTO General Council of 30 August 2003 on paragraph 6 of the declaration referred to in paragraph 1 of this Article and shall contribute to its implementation.

Article 186

Supplementary protection certificate

1. The Parties recognise that medicinal and plant protection products protected by a patent on their respective territory may be subject to an administrative authorisation procedure before being put on their market. They recognise that the period that elapses between the filing of the application for a patent and the first authorisation to place the product on their respective market, as defined for that purpose by domestic law, may shorten the period of effective protection under the patent.

2. Each Party shall provide for a further period of protection for a medicinal or plant protection product which is protected by a patent and which has been subject to an administrative authorisation procedure, that period being equal to the period referred to in the second sentence of paragraph 1, reduced by a period of five years.

3. Notwithstanding paragraph 2, the duration of the further period of protection may not exceed five years.

4. In the case of medicinal products for which paediatric studies have been carried out, and provided that the results of those studies are reflected in the product information, the Parties shall provide for a further six months extension of the period of protection referred to in paragraph 2.

Article 187

Protection of data submitted to obtain a marketing authorisation for medicinal products (30)

1. The Parties shall implement a comprehensive system to guarantee the confidentiality, non-disclosure and non-reliance of data submitted for the purpose of obtaining an authorisation to put a medicinal product on the market.

2. Each Party shall ensure, in its law, that any information submitted to obtain an authorisation to put a medicinal product on the market remains confidential and undisclosed to third parties and benefits from protection against unfair commercial use.

3. For that purpose, each Party shall not, for a period of at least six years from the date of the first authorisation in one of the Parties, permit other applicants to market the same or a similar product, on the basis of the marketing authorisation granted to the applicant which had provided the test data or studies, unless the applicant which had provided the test data or studies has given his consent. During such period, the test data or studies submitted for the first authorisation shall not be used for the benefit of any subsequent applicant aiming to obtain a marketing authorisation for a medicinal product, except when the consent of the first applicant is provided.

4. The six year period referred to in paragraph 3 shall be extended to a maximum of seven years if, during the first six years after obtaining the initial authorisation, the holder obtains an authorisation for one or more new therapeutic indications which are considered of significant clinical benefit in comparison with existing therapies.

5. Georgia undertakes to align its legislation concerning data protection for medicinal products with that of the Union at a date to be decided by the Association Committee in Trade configuration, as set out in Article 408(4) of this Agreement.

Article 188

Protection of data to obtain a marketing authorisation for plant protection products

1. Each Party shall determine safety and efficacy requirements before authorising the placing on the market of plant protection products.

2. Each Party shall ensure that data submitted for the first time by an applicant to obtain a marketing authorisation for a plant protection product benefits from protection against unfair commercial use and is not used for the benefit of any other person aiming to obtain a marketing authorisation, unless the proof of the explicit consent of the first holder is provided.

3. The test or study report submitted for the first time to obtain a marketing authorisation shall fulfil the following conditions:

(a)	that it is for the authorisation, or for an amendment of an authorisation in order to allow the use on other crops, and

(b)	that it is certified as compliant with the principles of good laboratory practice or of good experimental practice.

4. The period of protection of data shall be at least ten years starting from the date of the first marketing authorisation in the Party concerned.

Article 189

Plant varieties

The Parties shall protect plant varieties rights, in accordance with the International Convention for the Protection of New Varieties of Plants and shall cooperate to promote and enforce those rights.

Section 3

Enforcement of intellectual property rights

Article 190

General obligations

1. The Parties reaffirm their commitments under the TRIPS Agreement, and in particular Part III thereof, and shall provide for the complementary measures, procedures and remedies set out in this Section necessary to ensure the enforcement of intellectual property rights (31).

2. Those complementary measures, procedures and remedies shall be fair and equitable, and shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays.

3. Those complementary measures and remedies shall also be effective, proportionate and dissuasive and shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.

Article 191

Entitled applicants

Each Party shall recognise as persons entitled to seek application of the measures, procedures and remedies referred to in this Section and in Part III of the TRIPS Agreement:

(a)	the holders of intellectual property rights in accordance with the provisions of the applicable law,

(b)	all other persons authorised to use those rights, in particular licencees, in so far as permitted by and in accordance with the provisions of the applicable law;

(c)	intellectual property collective rights management bodies which are regularly recognised as having a right to represent holders of intellectual property rights, in so far as permitted by and in accordance with the provisions of the applicable law,

(d)	professional defence bodies which are regularly recognised as having a right to represent holders of intellectual property rights, in so far as permitted by and in accordance with the provisions of the applicable law.

Sub-section 1

Civil enforcement

Article 192

Measures for preserving evidence

1. Each Party shall ensure that, even before the commencement of proceedings on the merits of the case, the competent judicial authorities may, on application by a party who has presented reasonably available evidence to support his/her claims that his/her intellectual property right has been infringed or is about to be infringed, order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement, subject to the protection of confidential information.

2. Such measures may include the detailed description, with or without the taking of samples, or the physical seizure of the alleged infringing goods, and, in appropriate cases, the materials and implements used in the production and/or distribution of these goods and the documents relating thereto. Those measures shall be taken, if necessary without the other party being heard, in particular where any delay is likely to cause irreparable harm to the right holder or where there is a demonstrable risk of evidence being destroyed.

3. Where measures to preserve evidence are adopted without the other party having been heard, the parties affected shall be given notice without delay and at the latest after the execution of the measures.

Article 193

Right of information

1. Each Party shall ensure that, in the context of proceedings concerning an infringement of an intellectual property right and in response to a justified and proportionate request of the claimant, the competent judicial authorities may order that information on the origin and distribution networks of the goods or services which infringe an intellectual property right be provided by the infringer and/or any other person who:

(a)	was found in possession of the infringing goods on a commercial scale;

(b)	was found to be using the infringing services on a commercial scale;

(c)	was found to be providing on a commercial scale services used in infringing activities; or

(d)	was found to be producing, manufacturing or distributing infringing goods or to be providing services, through information provided by any person referred to in points (a), (b), or (c).

2. The information referred to in paragraph 1 shall, as appropriate, comprise:

(a)	the names and addresses of the producers, manufacturers, distributors, suppliers and other previous holders of the goods or services, as well as the intended wholesalers and retailers, and

(b)	information on the quantities produced, manufactured, delivered, received or ordered, as well as the price obtained for the goods or services in question.

3. Paragraphs 1 and 2 shall apply without prejudice to other statutory provisions which:

(a)	grant the right holder rights to receive fuller information;

(b)	govern the use in civil or criminal proceedings of the information communicated pursuant to this Article;

(c)	govern responsibility for misuse of the right of information;

(d)	afford an opportunity for refusing to provide information which would force the person referred to in paragraph 1 to admit to his/her own participation or that of his/her close relatives in an infringement of an intellectual property right; or

(e)	govern the protection of confidentiality of information sources or the processing of personal data.

Article 194

Provisional measures

1. Each Party shall ensure that the judicial authorities may, at the request of the applicant, issue against the alleged infringer an interlocutory injunction intended to prevent any imminent infringement of an intellectual property right, or to forbid, on a provisional basis and subject, where appropriate, to a recurring penalty payment where provided for by domestic law, the continuation of the alleged infringements of that right, or to make such continuation subject to the lodging of guarantees intended to ensure the compensation of the right holder. An interlocutory injunction may also be issued, under the same conditions, against an intermediary whose services are being used by a third party to infringe an intellectual property right.

2. An interlocutory injunction may also be issued to order the seizure or delivery up of goods suspected of infringing an intellectual property right, so as to prevent their entry into or movement within the channels of commerce.

3. In the case of an alleged infringement committed on a commercial scale, the Parties shall ensure that, if the applicant demonstrates circumstances likely to endanger the recovery of damages, the judicial authorities may order the precautionary seizure of the movable and immovable property of the alleged infringer, including the blocking of his/her bank accounts and other assets. To that end, the competent authorities may order access, where appropriate, to banking, financial or commercial documents under the control of the alleged infringer.

Article 195

Measures resulting from a decision on the merits of the case

1. Each Party shall ensure that the competent judicial authorities may order, at the request of the applicant and without prejudice to any damages due to the right holder by reason of the infringement, and without compensation of any sort, at least the definitive removal from the channels of commerce, or the destruction, of goods that they have found to be infringing an intellectual property right. If appropriate, the competent judicial authorities may also order the destruction of materials and implements predominantly used in the creation or manufacture of those goods.

2. The Parties' judicial authorities shall have the power to order that those measures shall be carried out at the expense of the infringer, unless particular reasons are invoked for not doing so.

3. Each Party shall ensure that, where a judicial decision is taken finding an infringement of an intellectual property right, the judicial authorities may issue against the infringer as well as against any intermediary whose services are used by a third party to infringe an intellectual property right an injunction aimed at prohibiting the continuation of the infringement.

4. The Parties may provide that, in appropriate cases and at the request of the person liable to be subject to the measures provided for in this Article, the competent judicial authorities may order pecuniary compensation to be paid to the injured party instead of applying the measures provided for in this Article if that person acted unintentionally and without negligence, if execution of the measures in question would cause him/her disproportionate harm and if pecuniary compensation to the injured party appears reasonably satisfactory.

Article 196

Damages

1. Each Party shall ensure that the judicial authorities, on application of the injured party, order the infringer who knowingly, or with reasonable grounds to know, engaged in an infringing activity, to pay the right holder damages appropriate to the actual prejudice suffered by that right holder as a result of the infringement. When the judicial authorities set the damages:

(a)

they shall take into account all appropriate aspects, such as the negative economic consequences, including lost profits, which the injured party has suffered, any unfair profits made by the infringer and, in appropriate cases, elements other than economic factors, such as moral prejudice, caused to the right holder by the infringement; or

(b)	as an alternative to (a), they may, in appropriate cases, set the damages as a lump sum on the basis of elements such as at least the amount of royalties or fees which would have been due if the infringer had requested authorisation to use the intellectual property right in question.

2. Where the infringer did not knowingly, or with reasonable grounds to know, engage in infringing activity, the Parties may lay down that the judicial authorities may order in favour of the injured party the recovery of profits or the payment of damages which may be pre-established.

Article 197

Legal costs

Each Party shall ensure that reasonable and proportionate legal costs and other expenses incurred by the successful party shall as a general rule be borne by the unsuccessful party, unless equity does not allow this and without prejudice to exceptions provided by domestic procedural rules.

Article 198

Publication of judicial decisions

Each Party shall ensure that, either in legal proceedings instituted for infringement of an industrial property right or in legal proceedings instituted for infringement of copyright, or in both cases, the judicial authorities may order at the request of the applicant and at the expense of the infringer, appropriate measures for the dissemination of the information concerning the decision, including displaying the decision and publishing it in full or in part.

Article 199

Presumption of authorship or ownership

For the purposes of applying the measures, procedures and remedies provided for in this Sub-Section:

(a)	for the author of a literary or artistic work, in the absence of proof to the contrary, to be regarded as such, and consequently to be entitled to institute infringement proceedings, it shall be sufficient for his/her name to appear on the work in the usual manner;

(b)	the provision under point (a) shall apply mutatis mutandis to the holders of rights related to copyright with regard to their protected subject matter.

Sub-section 2

Other provisions

Article 200

Border measures

1. Without prejudice to Article 75 of this Agreement and to Annex XIII to this Agreement, this Article establishes the general principles of this Agreement governing the enforcement of intellectual property rights by customs authorities and the obligations of the customs authorities of the Parties to engage in cooperation.

2. When implementing border measures for the enforcement of intellectual property rights the Parties shall ensure consistency with their obligations under GATT 1994 and the TRIPS Agreement.

3. The provisions on border measures in this Article are of procedural nature. They set out the conditions and procedures for action by the customs authorities where goods suspected of infringing an intellectual property right are, or should have been, under customs control. They shall not affect in any way the substantive law of the Parties on intellectual property.

4. To facilitate the effective enforcement of intellectual property rights, the customs authorities shall adopt a range of approaches to identify shipments containing goods suspected of infringing intellectual property rights. These approaches include risk analysis techniques based, inter alia, on information provided by rights holders, intelligence gathered and cargo inspections.

5. The Parties agree to effectively implement Article 69 of the TRIPS Agreement in respect of international trade in goods suspected of infringing intellectual property rights. For that purpose, the Parties shall establish and notify contact points in their customs administrations and shall be ready to exchange data and information on trade in such goods affecting both Parties. They shall, in particular, promote the exchange of information and cooperation between customs authorities with regard to trade in counterfeit trademark goods and pirated copyright goods. Without prejudice to the provisions of Protocol II on Mutual Administrative Assistance in Customs Matters to this Agreement customs authorities shall, where appropriate, exchange such information swiftly and with due respect to data protection laws of the Parties.

6. The customs authorities of each Party shall cooperate, upon request or upon their own initiative, to provide relevant available information to the customs authorities of the other Party, in particular for goods in transit through the territory of a Party destined for (or originating in) the other Party.

7. The Sub-Committee referred to in Article 74 of this Agreement shall establish the necessary practical arrangements concerning the exchange of data and information referred to in this Article.

8. Protocol II on Mutual Administrative Assistance in Customs Matters to this Agreement shall be applicable in respect to breaches of intellectual property rights, without prejudice to forms of cooperation resulting from the application of paragraphs 5 to 7 of this Article.

9. The Sub-Committee referred to in Article 74 of this Agreement shall act as the responsible Sub-Committee to ensure the proper functioning and implementation of this Article.

Article 201

Codes of conduct

The Parties shall encourage:

(a)	the development by trade or professional associations or organisations of codes of conduct aimed at contributing towards the enforcement of intellectual property rights.

(b)	the submission to their respective competent authorities of draft codes of conduct and of any evaluations of the application of those codes of conduct.

Article 202

Cooperation

1. The Parties agree to cooperate with a view to supporting the implementation of the commitments and obligations undertaken under this Chapter.

2. Areas of cooperation include, but are not limited to, the following activities:

(a)	exchange of information on the legal framework concerning intellectual property rights and relevant rules of protection and enforcement; exchange of experiences on legislative progress in those areas;

(b)	exchange of experiences and information on the enforcement of intellectual property rights;

(c)	exchange of experiences on central and sub-central enforcement by customs, police, administrative and judiciary bodies; coordination to prevent exports of counterfeit goods, including with other countries;

(d)	capacity-building; exchange and training of personnel;

(e)	promotion and dissemination of information on intellectual property rights in, inter alia, business circles and civil society; public awareness of consumers and right holders;

(f)	enhancement of institutional cooperation, for example between intellectual property offices;

(g)

actively promoting awareness and education of the general public on policies concerning intellectual property rights: formulate effective strategies to identify key audiences and create communication programmes to increase consumer and media awareness on the impact of intellectual property violations, including the risk to health and safety and the connection to organised crime.

CHAPTER 10

Competition

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