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chapter 5 trade remedies
article 5.1 scope
this chapter applies to trade in goods between the customs territory of china and the customs territory of switzerland as defined in article 2.1.
section i general trade remedies
article 5.2 antidumping
1. the rights and obligations of the parties in respect of antidumping measures shall be governed by article vi of the gatt 1994 and the wto agreement on implementation of article vi of the gatt 1994. the parties agree not to take such measures in an arbitrary or protectionist manner.
2. as soon as possible following the acceptance of a properly documented application from an industry in one party for the initiation of an antidumping investigation in respect of goods from the other party and before proceeding to initiate such investigation, that party shall notify the other party.
article 5.3 subsidies and countervailing measures
1. the rights and obligations of the parties in respect of subsidies and countervailing measures shall be governed by articles vi and xvi of the gatt 1994 and the wto agreement on subsidies and countervailing measures.
2. before a party initiates an investigation to determine the existence, degree and effect of any alleged subsidy in the other party, as provided for in article 11 of the wto agreement on subsidies and countervailing measures, the party considering initiating an investigation shall notify the other party and allow for a consultation with a view to finding a mutually acceptable solution in an amicable manner.
section ii bilateral safeguard measures
article 5.4 application of a bilateral safeguard measure
1. if, as a result of the reduction or elimination of a customs duty under this agreement, a product originating in a party is being imported into the territory of the other party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to cause serious injury or threat thereof to a domestic industry producing a like or directly competitive product, the importing party may apply a bilateral safeguard measure described in paragraph 2 during the transition period.
2. if the conditions in paragraph 1 are met, a party may, only to the extent as may be necessary to prevent or remedy serious injury, or threat thereof, and to facilitate adjustment:
(a) suspend the further reduction of any rate of customs duty on the product provided for under this agreement~ or
(b) increase the rate of customs duty on the product to a level not exceeding the lesser of:
i. the mfn applied rate of customs duty in effect at the time the measure is taken~ or
ii. the mfn applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this agreement.
3. no party may apply, with respect to the same product, at the same time:
(a) a bilateral safeguard measure~ and
(b) a measure under article xix of the gatt 1994 and the wto agreement on safeguards.
article 5.5 standards for a bilateral safeguard measure
1. bilateral safeguard measures shall only be taken during the transition period, which shall be a period of five years beginning on the date of entry into force of this agreement. in the case of a product where the liberalisation process as set out in annexi lasts five or more years, the transition period shall be extended to the date on which such a product reaches zero tariff according to the schedule in that annex plus three years.
2. bilateral safeguard measures shall in principle be limited to a period of two years~ they may be extended for another year. regardless of its duration, a bilateral safeguard measure shall terminate no later than at the end of the transition period for the product concerned.
3. a party shall not apply a bilateral safeguard measure again on a product which has been subject to such a measure for a period of time equal to that during which such a measure had been previously applied, provided that the period of nonapplication is at least two years. however, no bilateral safeguard measure may be applied more than twice on the same product.
4. upon the termination of the bilateral safeguard measure, the rate of customs duty shall be the rate which would have been in effect but for the measure.
article 5.6 investigation procedures and transparency requirements
1. the importing party may apply a bilateral safeguard measure only following an investigation by its competent authorities in accordance with article 3 of the wto agreement on safeguards. to this end, article 3 of the wto agreement on safeguards is incorporated into and made a part of this agreement, mutatis mutandis.
2. in determining whether increased imports of an originating product of the other party have caused serious injury or are threatening to cause serious injury to a domestic industry, the competent authority of the importing party shall follow the rules in article 4 of the wto agreement on safeguards. to this end, article 4 of the wto agreement on safeguards is incorporated into and made a part of this agreement, mutatis mutandis.
article 5.7 provisional safeguard measures
1. in critical circumstances, where delay would cause damage which would be difficult to repair, a party may take a provisional safeguard measure pursuant to a preliminary determination that there is clear evidence that increased imports have caused or are threatening to cause serious injury.
2. the duration of the provisional safeguard measure shall not exceed 200 days during which period the pertinent requirements of article 5.4, article 5.5, article 5.6 and article 5.8 shall be met. such a provisional safeguard measure shall take the form of an increase in the rate of customs duty not exceeding the lesser of the rates in article 5.4, which shall be promptly refunded if the subsequent investigation does not determine that increased imports have caused or threatened to cause serious injury to a domestic industry. the duration of any such provisional safeguard measure shall be
counted as a part of the duration of the measure set out in article 5.5.
article 5.8 notification and consultation
1. a party shall promptly notify the other party on:
(a) initiating an investigation~
(b) making a finding of serious injury or threat thereof caused by increased imports~ and
(c) taking a decision to apply or extend a bilateral safeguard measure.
2. the party making the notification referred to in subparagraphs 1(b) and 1(c) shall provide the other party with all pertinent information which shall include evidence of serious injury or threat thereof caused by increased imports, a precise description of the product involved and the proposed measure, as well as the proposed date of introduction and its expected duration. in the case of an extension of a bilateral safeguard measure, evidence that the continued application of the measure is necessary to prevent or remedy serious injury and that the industry is adjusting, shall also be provided.
3. a party proposing to apply or extend a bilateral safeguard measure shall provide adequate opportunity for prior consultations with the other party, with a view to, inter alia, reviewing the information provided under paragraph 2, exchanging views on the bilateral safeguard measure and reaching an agreement on compensation as set forth in article 5.9.
4. before a party takes a provisional safeguard measure referred to in article 5.7, it shall notify the other party, and, on request of the other party, consultations shall be initiated immediately after taking such a measure.
article 5.9 compensation
the party applying a bilateral safeguard measure shall, in consultation with the other party, provide to the other party mutually agreed trade liberalizing compensation in the form of substantially equivalent concessions during the period of application of the bilateral safeguard measure.
2. if the parties are unable to reach agreement on compensation within 30 days after the application of the bilateral safeguard measure, the party against whose product the bilateral safeguard measure is taken may take compensatory action. in the selection of the compensatory action, priority must be given to the action which least disturbs the functioning of this agreement. the right of compensation referred to in this paragraph shall not be exercised for the first six months that a bilateral safeguard measure is in effect under the condition that the bilateral safeguard measure has been taken as a result of an absolute increase in imports and that such a measure conforms to the provisions of this chapter.
3. a party shall notify the other party at least 30 days before taking compensatory action under paragraph 2.
4. the party taking compensatory action shall apply the action only for the minimum period necessary to achieve the substantially equivalent trade effects and in any event, only while the bilateral safeguard measure is being applied.
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