Tariff schedules and appendices are subject to
legal review, transposition and verification by the Parties. The only authentic
tariff commitments are those that are set out in the Tariff Elimination Annex
that accompanies the final, signed Agreement
Appendix B to Tariff Schedule of Canada
(Appendix between Japan and Canada on Motor
Vehicle Trade)
Article 1
1. For the purposes of this Appendix,
Appendix Party means either Japan or Canada,
as the case may be.
motor vehicle(s) means any good(s) classified
under heading 87.03; and
originating motor vehicle(s) means any motor
vehicle(s) qualifying as originating under Chapter DD (Rules of Origin and
Origin Procedures).
2. No Party other than an Appendix Party shall have
recourse to dispute settlement under Chapter BBB (Dispute Settlement) for any
matter arising under this Appendix or to dispute settlement under Article 4 for
any matter arising under this Agreement. No Appendix Party shall have recourse
to dispute settlement under Chapter BBB (Dispute Settlement) for nullification
or impairment in the sense of Article BBB.3.1(c) for any matter arising under
Article 3 or 4 of this Appendix.
Article 2
An Appendix Party shall accord to the other Appendix
Party treatment no less favourable than that accorded to a Party other than an
Appendix Party with respect to technical regulations, standards or conformity
assessment procedures on motor vehicles that are adopted or applied in
accordance with a bilateral agreement provided for in this Agreement.
Article 3
An Appendix Party may apply, during the transition
period only, a transitional safeguard measure on originating motor vehicles
from the other Appendix Party classified under heading 87.03 in accordance with
the provisions set out in Chapter HH (Trade Remedies), with the following
procedural modifications:
(a) In lieu of the definition of transition period
provided in Article HH.1 (Definitions), the following definition shall apply:
transition period means the period beginning
on the date of entry into force of this Agreement with respect to Japan and
Canada and ending on the date that is 12 years after the end of the tariff
elimination period for the good set out in Annex BB-X (Tariff Elimination
Schedule).
(b) In lieu of Article HH.4.2 (Standards for a
Transitional Safeguard Measure), the following shall apply: Neither Appendix
Party may apply a transitional safeguard measure for a period exceeding three
years, except that the period may be extended by up to two years if the
competent authorities of the importing Appendix Party determine, in conformity
with the procedures provided for in Article HH.5 (Investigation Procedures and
Transparency Requirements), that the measure continues to be necessary to
prevent or remedy serious injury and to facilitate adjustment and that there is
evidence that the industry is adjusting, provided that the total period of
application of the transitional safeguard measure, including the period of
initial application and any extension thereof, shall not exceed five years.
(c) Articles HH.4.4 and 6 (Standards for a
Transitional Safeguard Measure) shall not apply.
(d) In lieu of Articles HH.7.1 and 2 (Compensation),
the following shall apply:
(i) An Appendix Party applying a transitional
safeguard measure shall consult with the other Appendix Party in order to
mutually agree on appropriate trade liberalizing compensation in the form of
concessions having substantially equivalent trade effects or equivalent to the
value of the additional duties expected to result from the transitional safeguard
measure. The Appendix Party shall provide an opportunity for such consultations
no later than 30 days after the application of the transitional safeguard
measure;
(ii) If the consultations under subparagraph (d)(i)
do not result in an agreement on trade liberalizing compensation within 30 days
after the consultations begin, the Appendix Party whose goods are subject to
the transitional safeguard measure may suspend the application of substantially
equivalent concessions to the Appendix Party applying the transitional
safeguard measure; and
(iii) The right of suspension referred to in
subparagraph (d)(ii) shall not be exercised for the first 24 months during
which a transitional safeguard measure is in effect, provided that the
transitional safeguard measure conforms to the provisions of this Agreement.
Article 4
1. For the purposes of this Article, the definitions
set out in Article BBB.1 shall apply, mutatis mutandis.1
[1 For the purposes of this paragraph, the references
to “Article BBB.5.1”, “Article BBB.7” and “Article BBB.7.1” shall be deemed to
read “paragraph 3”, “paragraph 4” and “paragraph 4(a)”, respectively.]
2. With respect to any matter described in Article
BBB.32 that relates to motor vehicles, an Appendix Party may
initiate the dispute settlement procedures set out in this Article in lieu of
the procedures provided for in Articles BBB.4 through BBB.20.
[2 For greater certainty, no
Appendix Party shall have recourse to dispute settlement under this Article for
any matter for which it shall not have recourse to dispute settlement under
Chapter BBB (Dispute Settlement).]
3. (a) An Appendix Party may request in writing
consultations with the other Appendix Party with respect to any matter
described in paragraph 2. In a request for consultations, the requesting
Appendix Party shall set out the reasons for the request, including
identification of the actual or proposed measure or other matter at issue and
an indication of the legal basis for the complaint. The requesting Appendix
Party shall circulate the request to all other Parties through the Contact
Points designated in accordance with Article AAA.5 (Administrative and
Institutional Provisions -- Contact Points).
(b) The Appendix Party to which a request for
consultations is made shall, unless the Appendix Parties agree otherwise, reply
to the request in writing within seven days after the date of its receipt. That
Appendix Party shall circulate the reply to all other Parties and enter into
consultations in good faith.
(c) Unless the Appendix Parties agree otherwise, they
shall enter into consultations within a period of no more than 15 days after
the date of receipt of the request for consultations.
(d) Unless the Appendix Parties agree otherwise,
Articles BBB.5.5 through 5.7 and 5.8 shall apply, mutatis mutandis3,
to the consultations under this paragraph.
[3 For the purposes of this paragraph, the references
to “paragraph 1” in Article BBB.5.5 shall be deemed to read “subparagraph (a)”,
and the references to “this Article” in Articles BBB.5.6 and 5.7 shall be
deemed to read “this paragraph”.]
4.
(a) The Appendix Party that requested consultations
pursuant to paragraph 3(a) may request, by means of a written notification
addressed to the other Appendix Party, the establishment of a panel if the
Appendix Parties fail to resolve the matter within 30 days after the date of
receipt of the request for consultations.
(b) At the same time, the complaining Appendix Party
shall circulate the request to all other Parties through the contact points
designated in accordance with Article AAA.5 (Administrative and Institutional
Provisions -- Contact Points).
(c) Articles BBB.7.3, 7.4 and 7.8 shall apply, mutatis
mutandis to the establishment of a panel. Unless the Appendix Parties agree
otherwise, the panel shall be composed in a manner consistent with this Article
and, subject to the time-frames set out in paragraph 6, the Rules of Procedure.
5.
(a) Unless the Appendix Parties agree otherwise
within 15 days from the delivery of the request for the establishment of the
panel, the terms of reference shall be to:
(i) examine, in the light of the relevant provisions
of this Agreement, the matter referred to in the request for the establishment
of a panel pursuant to paragraph 4(a); and
(ii) make findings and determinations, and any
requested recommendations, together with its reasons therefor, as provided for
in Article BBB.16.4 as applied pursuant to paragraph 8.
(b) If, in its panel request, the complaining
Appendix Party has claimed that a measure nullifies or impairs benefits in the
sense of Article BBB.3.1(c), the terms of reference shall so indicate.
6.
(a) The panel shall comprise three members.
(b) Unless they agree otherwise, the Appendix Parties
shall apply the following procedures in selecting a panel:
(i) Within 15 days of the delivery of the request for
the establishment of a panel, the complaining Appendix Party, on the one hand,
and the responding Appendix Party, on the other, shall appoint a panellist and
notify each other of those appointments.
(ii) If the complaining Appendix Party fails to
appoint a panellist within the period specified in subparagraph (b)(i), the
dispute settlement proceedings shall lapse at the end of that period.
(iii) If the responding Appendix Party fails to
appoint a panellist within the period set out in subparagraph (b)(i), the
panellist not yet appointed shall be chosen by the complaining Appendix Party:
(A) from the responding Appendix Party’s list
established under Article BBB.10.11;
(B) if the responding Appendix Party has not
established a list under Article BBB.10.11, from the roster of panel chairs
established pursuant to Article BBB.10.3; or
(C) if no roster of panel chairs has been established
pursuant to Article BBB.10.3, by random selection from a list of three
candidates, who are not nationals of the complaining Appendix Party, nominated
by the complaining Appendix Party.
within 20 days of the delivery of the request for the
establishment of a panel under paragraph 4(a).
(iv) For appointment of the chair of the panel:
(A) The Appendix Parties shall endeavour to agree on
the appointment of a chair of the panel.
(B) If the Appendix Parties fail to appoint a chair
pursuant to subparagraph (b)(iv)(A) within 15 days of the delivery of the
request for the establishment of the panel under paragraph 4(a), the Appendix
Parties shall select the third panellist by random selection from the roster
established pursuant to Article BBB.10.3 within 20 days of the delivery of the
request for the establishment of the panel. The third panellist shall serve as
chair.
(C) If a roster has not been established pursuant to
Article BBB.10.3, and subparagraphs (b)(iv)(A) and (B) cannot apply, each
Appendix Party may nominate up to three candidates and the third panellist shall
be randomly selected from those candidates that have been nominated within 20
days after the date of delivery of the request for the establishment of a panel
under paragraph 4(a).
(D) Unless the Appendix Parties agree otherwise, the
chair of the panel shall not be a national of either Appendix Party.
(v) If a panellist selected under subparagraph
(b)(iii) or (iv)(B) is unable to serve on the panel, the Appendix Parties shall
meet within five days of learning that the panellist is unavailable to select another
panellist from among the remaining members of the list (in the case of
subparagraph (b)(iii)), or the roster (in the case of subparagraph (b)(iv)(B)).
(vi) If a panellist appointed under this paragraph
resigns or becomes unable to serve on the panel, either during the course of
proceeding or at such time as the panel is reconvened pursuant to paragraph 13
or Article BBB.20 (Compliance Review) as applied pursuant to paragraph 12, 17
or 18, a replacement panellist shall be appointed within 12 days in accordance
with the selection procedures prescribed in subparagraph (b) for the
appointment of the original panellist and the replacement shall have all the
powers and duties of the original panellist. The work of the panel shall be
suspended pending the appointment of the replacement panellist, and all
relevant time-frames set out in this Article and in the Rules of Procedure
shall be extended by the amount of time that the work was suspended; and
(vii) Articles BBB.9.3 through 9.6 and 9.9 shall
apply, mutatis mutandis4, to the selection procedures.
[4 For the purposes of this paragraph, the references
to “paragraph 2(d)(i)-(iii) and (v)” in Articles BBB.9.4 through 9.6 shall be
deemed to read “subparagraph (b)(iv)(A) and (C)”, and the reference to “this Article”
in Article BBB.9.9 shall be deemed to read “this paragraph”.]
7. All panellists shall meet the requirements set out
in Article BBB.10.1. An individual may not serve as a panellist for a dispute
in which he or she has participated under Article BBB.6 (Good Offices,
Conciliation, and Mediation) as applied pursuant to paragraph 8.
8. Unless the Appendix Parties agree otherwise,
Articles BBB.4 (Choice of Forum), BBB.6 (Good Offices, Conciliation and
Mediation), BBB.11 (Functions of Panels), BBB.14 (Role of Experts), BBB.15
(Suspension or Termination of Proceedings), BBB.16 (Initial Report) and BBB.17
(Final Report) shall apply, mutatis mutandis5, to panel
proceedings under this Article, except that:
[5 For the purposes of this paragraph, the reference to
“Article BBB.7 (Establishment of a Panel)” in Article BBB.6.4 shall be deemed
to read “paragraph 4”, and the references to “this Chapter” in Articles
BBB.11.2 and 15.1 shall be deemed to read “this Article”.]
(a) with
respect to Article BBB.16.3, the panel shall present to the Appendix Parties an
initial report within 100 days after the last panellist is appointed;
(b) with respect to Article BBB.16.4, the panel shall
also make a determination as to whether the non-conformity or the nullification
or impairment, if any, has materially affected the sale, offering for sale,
purchase, transportation, distribution or use of originating motor vehicles
from the complaining Appendix Party;
(c) with respect to Article BBB.16.7, each Appendix
Party may submit written comments to the panel on its initial report within 10
days of the presentation of the report or within such other period as the
Appendix Parties may agree; and
(d) with respect to Article BBB.17.1, the panel shall
present a final report to the Appendix Parties, including any separate opinions
on matters not unanimously agreed, within 20 days of presentation of the
initial report. The Appendix Parties shall release the final report to the
public within 15 days thereafter, subject to the protection of confidential
information.
9. Unless the Appendix Parties agree otherwise,
Articles BBB.18.1 and 18.2 shall apply, mutatis mutandis6, to
the implementation of the final report.
[6 For the purposes of this paragraph, the reference
to “this Chapter” in Article BBB.18.1 shall be deemed to read “this Article”.]
10.
(a) Unless the Appendix
Parties agree otherwise, if in its final report, the panel determines that:
(i) (A) a measure at issue is
inconsistent with an Appendix Party’s obligations under this Agreement;
(B) an Appendix Party has
otherwise failed to carry out its obligations under this Agreement; or
(C) an Appendix Party’s
measure is causing nullification or impairment in the sense of Article
BBB.3.1(c); and
(ii) the non-conformity or
the nullification or impairment that the panel has determined to exist has
materially affected the sale, offering for sale, purchase, transportation,
distribution or use of originating motor vehicles from the complaining Appendix
Party, the complaining Appendix Party may suspend the application to the
responding Appendix Party of benefits in accordance with this paragraph,
paragraph 11 and paragraphs 13 through 16.
(b) Unless the Appendix Parties agree otherwise, the
responding Appendix Party shall have a reasonable period of time in which to
eliminate the non-conformity or nullification or impairment if it is not
practicable to comply immediately.
(c) Unless the Appendix Parties agree otherwise, the
reasonable period of time shall be:
(i) 6 months from the presentation of the panel’s
final report to the Appendix Parties under Article BBB.17.1 (Final Report) as
applied pursuant to paragraph 8; or
(ii) if elimination of the non-conformity or
nullification or impairment requires amendment of laws or regulations adopted
by the Diet of Japan or the Parliament of Canada, or the legislative body of
local subdivision, 12 months from the presentation of the panel’s final report.
11.
(a) The responding Appendix Party shall, if so
requested by the complaining Appendix Party, enter into negotiations with the
complaining Appendix Party within 15 days of receipt of such request, with a
view to developing mutually acceptable compensation, in circumstances where:
(i) the responding Appendix Party has notified the
complaining Appendix Party that it does not intend to eliminate the
non-conformity or the nullification or impairment; or
(ii) following the expiry of the reasonable period of
time set out in paragraph 10(c), there is disagreement between the Appendix
Parties as to whether the responding Appendix Party has eliminated the
non-conformity or the nullification or impairment.
(b) A complaining Appendix Party may suspend the
application to the responding Appendix Party of benefits in accordance with
subparagraph (c) if the Appendix Parties have:
(i) been unable to agree on compensation within 30
days after the period for developing such compensation has begun in accordance
with subparagraph (a); or
(ii) agreed on compensation but the complaining
Appendix Party considers that the responding Appendix Party has failed to
observe the terms of the agreement.
(c) A complaining Appendix Party may, at any time
after the conditions set out in subparagraph (b) are met in relation to the
complaining Appendix Party, provide written notice to the responding Appendix
Party that it intends to suspend the application to the responding Appendix
Party of benefits under paragraph 14 or 15. The notice shall specify the level
of benefits that the complaining Appendix Party proposes to suspend. The
complaining Appendix Party may suspend the application to the responding
Appendix Party of benefits in accordance with paragraph 14 or 15 after the date
on which it provides the notice.
(d) Compensation and the suspension of benefits shall
be temporary measures. None of these measures is preferred to full
implementation through elimination of the non-conformity or the nullification
or impairment. Compensation and suspension of benefits shall only be applied
until such time as the responding Appendix Party has eliminated the
non-conformity or the nullification or impairment, or a mutually satisfactory
solution is reached.
12. Unless the Appendix Parties agree otherwise, if
in its final report the panel determines that the non-conformity or the
nullification or impairment that the panel has determined to exist under
paragraph 10(a)(i) has not materially affected the sale, offering for sale,
purchase, transportation, distribution or use of originating motor vehicles
from the complaining Appendix Party, the procedures provided for in Articles
BBB.18.3 through 18.7, BBB.19 (Non-Implementation-Compensation and Suspension
of Benefits) and BBB.20 (Compliance Review) shall apply, mutatis mutandis.
13.
(a) If the responding Appendix Party considers that:
(i) the level of benefits proposed to be suspended
under paragraph 15 is manifestly excessive; or
(ii) it has eliminated the non-conformity or the
nullification or impairment that the panel has determined to exist, it may,
within 30 days after the complaining Appendix Party provides notice under
paragraph 11(c), request that the panel be reconvened to consider the matter.
The responding Appendix Party shall deliver its request in writing to the
complaining Appendix Party. The panel shall reconvene as soon as possible after
delivery of the request and shall present its determination to the Appendix
Parties within 90 days after delivery of the request.
(b) If the panel determines that the level of
benefits proposed to be suspended under paragraph 15 is manifestly excessive,
it shall determine the level of benefits that the complaining Appendix Party
may suspend. The panel shall determine:
(i) the level of benefits of equivalent effect, as set
out in Article BBB. 19.5; and
(ii) if the prevailing most-favoured-nation applied
rate of customs duty of the complaining Appendix Party on motor vehicles
classified under heading 87.03 is zero, the level of benefits equivalent to the
effect of application by the responding Appendix Party of its prevailing
most-favoured-nation applied rate of customs duty on motor vehicles classified
under heading 87.03.
14. Unless the panel has determined that the
responding Appendix Party has eliminated the non-conformity or the
nullification or impairment, 30 days after the later of the date on which:
(a) the complaining Appendix Party provides the
notice under paragraph 11(c); or
(b) if the responding Appendix Party requests that
the panel be reconvened to consider the matter under paragraph 13(a)(ii), the
panel issues its determination under paragraph 13, the complaining Appendix
Party may increase the rate of customs duty on originating motor vehicles from
the responding Appendix Party classified under heading 87.03 to a level not to
exceed the prevailing most-favoured-nation applied rate of customs duty on
motor vehicles, for a period of up to 100 days following the 30-day period.
15. Unless the panel has determined that the
responding Appendix Party has eliminated the non-conformity or the
nullification or impairment:
(a) if the panel determines the level of benefits
under paragraph 13(b), 30 days after the later of the date on which the
complaining Appendix Party provides the notice under paragraph 11(c) or the
panel issues its determination under paragraph 13, the complaining Appendix
Party may,
(i) increase the rate of customs duty on originating
motor vehicles from the responding Appendix Party classified under heading
87.03 up to the level the panel has determined under paragraph 13(b)(i); or
(ii) if the prevailing most-favoured-nation applied
rate of customs duty of the complaining Appendix Party on motor vehicles under
heading 87.03 is zero, suspend the application to the responding Appendix Party
of benefits with respect to originating goods from the responding Appendix
Party:
(A) up to the level the panel has determined under
paragraph 13(b)(i); and,
(B) up to the level the panel has determined under
paragraph 13(b)(ii) for a period of up to 100 days following the 30-day period
and,
(b) if the responding Appendix Party does not request
that the panel be reconvened to consider the matter under paragraph 13(a)(i) or
the panel has not determined the level under paragraph 13(b), after the 30-day
period, the complaining Appendix Party may suspend the application to the
responding Appendix Party of benefits up to the level the complaining Appendix
Party has proposed to suspend under paragraph 11(c),
provided that the increased rate of customs duty
applied to any goods under this paragraph shall not exceed the prevailing
most-favoured-nation applied rate of customs duty on such goods.
16 As long as the complaining Appendix Party is
applying the increased rate of customs duty under paragraph 14, it shall not suspend
the application to the responding Party of benefits under this paragraph.
17. Unless the Appendix Parties agree otherwise,
Article BBB.20 (Compliance Review) shall apply, mutatis mutandis7,
to compliance review.
[7 For the purposes of this paragraph, the references
to “Article 19 (Non-Implementation-Compensation and Suspension of Benefits)” in
Article BBB.20 shall be deemed to read “paragraphs 11 and 13 through 16 ”.]
18. If a final report is presented after the 10-year
period beginning on the date of entry into force of this Agreement, the
procedures provided for in Articles BBB.18.3 through 18.7, BBB.19
(Non-Implementation-Compensation and Suspension of Benefits) and BBB.20
(Compliance Review) shall apply, mutatis mutandis, in lieu of the
procedures provided for in paragraphs 10 through 17.
Article 58
[8 No Appendix Party shall
have recourse to dispute settlement under Chapter BBB (Dispute Settlement) or
Article 4 for any matter arising under this Article.]
1. The Appendix Parties hereby establish a special
bilateral Committee on Motor Vehicles (hereinafter referred to as sthe
“Committee”), comprising the representatives of the relevant authorities of
each Appendix Party. The Committee shall:
(a) monitor implementation of
the obligations of this Agreement with respect to motor vehicles;
(b) consult to resolve issues
affecting trade and investment between the Appendix Parties that an Appendix
Party raises with respect to the development and implementation of measures
relating to motor vehicles and motor vehicle parts;
(c) facilitate increased
cooperation with respect to emerging issues, including the manufacture,
importation, sale and operation of motor vehicles using alternative fuels, and
cooperation between the Appendix Parties with respect to issues concerning
other markets;
(d) monitor bilateral,
regional and global market developments and trends in trade, investment,
production, sales and distribution with respect to motor vehicles and motor
vehicle parts;
(e) provide opportunities for
input from interested persons of the Appendix Parties on matters relevant to
the Committee’s work, as the Appendix Parties may agree; and
(f) address other issues, if
the Appendix Parties agree.
2. The Committee shall meet at mutually agreed times.
Meetings shall take place in such locations and through such means as the
Appendix Parties decide.
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