Agreement between the United States of America and
the Socialist Republic of Vietnam on Trade Relations

The Government of the United States of America and the Government of the Socialist Republic of Vietnam (hereinafter referred to collectively as "Parties" and individually as "Party"),

Desiring to establish and develop mutually beneficial and equitable economic and trade relations on the basis of mutual respect for their respective independence and sovereignty;

Acknowledging that the adoption of and compliance with international trade norms and standards by the Parties will aid the development of mutually beneficial trade relations, and should be the underlying basis of those relations;

Noting that Vietnam is a developing country at a low level of development, is in the process of economic transition and is taking steps to integrate into the regional and world economy by, inter alia, joining the Association of Southeast Asian Nations (ASEAN), the ASEAN Free Trade Area (AFTA), and the Asia Pacific Economic Cooperation forum (APEC), and working toward membership in the World Trade Organization (WTO);

Having agreed that economic and trade ties and intellectual property rights protection are an important and necessary element in the strengthening of their bilateral relations; and

Being convinced that an agreement on trade relations between the Parties will best serve their mutual interests,

Have agreed as follows:

CHAPTER I

TRADE IN GOODS


Article 1
Most Favored Nation (Normal Trade Relations)¹

A. customs duties and charges of any kind imposed on or in connection with importation or exportation, including the method of levying such duties and charges;

B. methods of payment for imports and exports, and the international transfer of such payments;

C. rules and formalities in connection with importation and exportation, including those relating to customs clearance, transit, warehouses and transshipment;

D. taxes and other internal charges of any kind applied directly or indirectly to imported products;

E. laws, regulations and other requirements affecting the sale, offering for sale, purchase, transportation, distribution, storage and use of products in the domestic market; and

F. the application of quantitative restrictions and the granting of licenses.

2. The provisions of paragraph 1 of this Article shall not apply to action by a Party which is consistent with such Party's obligations under the World Trade Organization and the agreements administered thereby. A Party shall nonetheless extend to the products originating in the territory of the other Party most-favored nation treatment in respect of any tariff reductions resulting from multilateral negotiations under the auspices of the World Trade Organization provided such Party accords such benefits to all other WTO members.

3. The provisions of paragraph 1 of this Article shall not apply to:

A. advantages accorded by either Party by virtue of such Party's full membership in a customs union or free trade area, and

B. advantages accorded to third countries for the facilitation of frontier traffic.

Article 2
National Treatment

A. ensure that any sanitary or phytosanitary measure which is not inconsistent with the provisions of the GATT 1994, is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient evidence (i.e., a risk assessment), taking into account the availability of relevant scientific information and regional conditions, such as pest free zones;

B. ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking into account the risks non- fulfillment would create. Such legitimate objectives include national security requirements; the prevention of deceptive practices; protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration include available scientific and technical information, related processing technology or intended end- uses of products.

A. Upon entry into force of this Agreement, all domestic enterprises shall be allowed to engage in trading activities in all products, subject to restrictions listed in Annexes B and C.

B. Upon entry into force of this Agreement, enterprises with capital directly invested by U.S. nationals and companies shall be allowed, subject to the restrictions in Annexes B and C, to import goods and products to be used in, or in connection with their production or export activities whether or not such imports are specifically identified in their initial investment license.

C. Three years after entry into force of this Agreement, enterprises with capital directly invested by U.S. nationals and companies, in production and manufacturing sectors, shall be allowed to engage in trading activities, subject to the restrictions listed in Annexes B, C and D, and provided such enterprises are (i) engaged in substantial business activities in the production and manufacturing sectors; and (ii) are lawfully operating in Vietnam.

D. Three years after entry into force of this Agreement, U.S. nationals and companies shall be allowed to enter into joint ventures with Vietnamese counterparts to engage in trading activities in all products, subject to restrictions listed in Annexes B, C and D. Equity contributed by U.S. companies shall not exceed 49% of such joint ventures' legal capital. Three years thereafter, this limitation on U.S. ownership shall be 51%.

E. Seven years after entry into force of this Agreement, U.S. companies shall be allowed to establish 100% U.S.- owned companies to engage in trading activities in all products, subject to restrictions listed in Annexes B, C and D.

8. If a Party has not acceded to the International Convention on the Harmonized Commodity Description and Coding System, it will undertake every reasonable effort to do so as soon as possible, but no later than one year after the entry into force of this Agreement.

Article 3
General Obligations with Respect to Trade

1. The Parties shall seek to achieve a satisfactory balance of market access opportunities through the satisfactory reciprocation of reductions in tariffs and nontariff barriers to trade in goods resulting from multilateral negotiations.

2. The Parties shall except as specifically provided in Annexes B and C to this Agreement, eliminate all import and export restrictions, quotas, licensing requirements, and controls for all product and service categories, other than those that would be permitted by GATT 1994.

3. The Parties shall, within two years of the entry into force of this Agreement, limit all fees and charges of whatever character (other than import and export duties and other taxes within the purview of Article 2 of this Chapter) imposed on or in connection with importation or exportation to an amount approximate to the cost of services rendered, and ensure that such fees and charges do not represent an indirect protection to domestic products or a taxation of imports or exports for fiscal purposes;

4. The Parties shall, within two years of the entry into force of this Agreement, adopt a system of customs valuation based on the transaction value of the imported merchandise on which duty is assessed, or of like merchandise, rather than on the value of merchandise of national origin or on arbitrary or fictitious values, with the transaction value being the price actually paid or payable for the goods when sold for export to the country of importation in accordance with the standards established in the Agreement on Implementation of Article VII of the GATT 1994; and

5. Within two years of entry into force of this Agreement, the Parties shall ensure that the fees and charges referred to in paragraph 3 of this Article and the customs valuation system referred to in paragraph 4 of this Article are imposed or implemented uniformly and consistently throughout each Party's customs territory.

6. In addition to the obligations set forth in Article 1, Vietnam shall provide tariff treatment to products originating in the customs territory of the United States in accordance with the provisions of Annex E.

7. Neither Party shall require its nationals or companies to engage in barter or countertrade transactions with nationals or companies of the other Party. Nevertheless, where nationals or companies decide to resort to barter or countertrade operations, the Parties may furnish them information to facilitate the transaction and assist them as they would with respect to other export and import operations.

8. The United States shall consider Vietnam's eligibility for the Generalized System of Preferences.

Article 4
Expansion and Promotion of Trade

Each Party shall encourage and facilitate the holding of trade promotional events such as trade fairs, exhibitions, missions and seminars in its territory and in the territory of the other Party. Similarly, each Party shall encourage and facilitate the participation of its respective nationals and companies in such events. Subject to the laws in force within their respective territories, the Parties agree to allow the import and re-export on a duty free basis of all articles for use in such events, provided that such articles are not sold or otherwise transferred.

Article 5
Government Commercial Offices

1. Subject to its laws and regulations governing foreign missions, each Party shall allow government commercial offices of the other Party to hire host-country nationals and, subject to immigration laws and procedures, third-country nationals.

2. Each Party shall ensure unhindered access of host-country nationals to government commercial offices of the other Party.

3. Each Party shall allow the participation of its nationals and companies in the commercial activities of the other Party's government commercial offices.

4. Each Party shall allow access by government commercial office personnel of the other Party to the relevant host-country officials, and to representatives of nationals and companies of the host Party.

Article 6
Emergency Action on Imports

1. The Parties agree to consult promptly at the request of either Party whenever either actual or prospective imports of products originating in the territory of the other Party cause or threaten to cause or significantly contribute to market disruption. Market disruption exists within a domestic industry whenever imports of an article, like or directly competitive with an article produced by such domestic industry, are increasing rapidly, either absolutely or relatively, so as to be a significant cause of material injury, or threat thereof, to such domestic industry. The consultations provided in this paragraph shall have the objectives of (a) presenting and examining the factors relating to such imports that may be causing or threatening to cause or significantly contributing to market disruption, and (b) finding means of preventing or remedying such market disruption. Such consultations shall be concluded within sixty days from the date of the request for such consultations, unless the Parties agree otherwise.

2. Unless a different solution is mutually agreed upon during the consultations, the importing Party may (a) impose quantitative import limitations, tariff measures or any other restrictions or measures it deems appropriate, and for such period of time it deems necessary, to prevent or remedy threatened or actual market disruption, and (b) take appropriate measures to ensure that imports from the territory of the other Party comply with such quantitative limitations or other restrictions introduced in connection with market disruption. In this event, the other Party shall be free to deviate from its obligations under this Agreement with respect to substantially equivalent trade.

3. Where in the judgment of the importing Party, emergency action is necessary to prevent or remedy such market disruption, the importing Party may take such action at any time without prior notice or consultation, on the condition that consultations shall be effected immediately after taking such action.

4. The Parties acknowledge that the elaboration of the market disruption safeguard provisions in this Article is without prejudice to the right of either Party to apply its laws and regulations applicable to trade in textiles and textile products, and its laws and regulations applicable to unfair trade, including antidumping and countervailing duty laws.

Article 7
Commercial Disputes

For the purposes of Chapter I of this Agreement:

1. Nationals and companies of either Party shall be accorded national treatment with respect to access to all competent courts and administrative bodies in the territory of the other Party, as plaintiffs, defendants or otherwise. They shall not be entitled to claim or enjoy immunity from suit or execution of judgment, proceedings for the recognition and enforcement of arbitral awards, or other liability in the territory of the other Party with respect to commercial transactions. They also shall not claim or enjoy immunities from taxation with respect to commercial transactions, except as may be provided in other bilateral agreements.

2. The Parties encourage the adoption of arbitration for the settlement of disputes arising out of commercial transactions concluded between nationals or companies of the United States of America and nationals or companies of the Socialist Republic of Vietnam. Such arbitration may be provided for by agreements in contracts between such nationals and companies, or in separate written agreements between them.

3. The parties to such transactions may provide for arbitration under any internationally recognized arbitration rules, including the UNCITRAL Rules of December 15, 1976, and any modifications thereto, in which case the parties should designate an Appointing Authority under said rules in a country other than the United States of America or the Socialist Republic of Vietnam.

4. The parties to the dispute, unless otherwise agreed between them, should specify as the place of arbitration a country other than the United States of America or the Socialist Republic of Vietnam, that is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York, June 10, 1958.

5. Nothing in this Article shall be construed to prevent, and the Parties shall not prohibit, the parties from agreeing upon any other form of arbitration or on the law to be applied in such arbitration, or other form of dispute settlement which they mutually prefer and agree best suits their particular needs.

6. Each Party shall ensure that an effective means exists within its territory for the recognition and enforcement of arbitral awards.

Article 8
State Trading

1. The parties may establish or maintain a state enterprise, or grant to any enterprise, formally or in effect, exclusive or special privileges, to import and export the products listed in Annex C, provided however, that any such enterprise shall, in its purchases or sales involving either imports or exports, act in a manner consistent with the general principles of non-discriminatory treatment prescribed in this Agreement for governmental measures affecting imports or exports by private traders.

2. The provisions of paragraph 1 of this Article shall be understood to require that such enterprises shall, having due regard to the other provisions of this Agreement, make any such purchases or sales solely in accordance with commercial considerations, including price, quality, availability, marketability, transportation and other conditions of purchase or sale, and shall afford the enterprises of the other Party adequate opportunity, in accordance with customary business practice, to compete for participation in such purchases or sales.

3. The provisions of paragraph 1 of this Article shall not apply to imports of products for immediate or ultimate consumption in government use and not otherwise for resale or use in the production of goods for sale. With respect to such imports, each Party shall accord to the trade of the other Party fair and equitable treatment.

Article 9
Definitions

As used in this Chapter, the terms set forth below shall have the following meaning:

1. "company," means any entity constituted or organized under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, and includes a corporation, trust, partnership, sole proprietorship, branch, joint venture, association, or other organization.

2. "enterprise," means a company.

3. "national," means a natural person who is a national of a Party under its applicable law.

4. "commercial dispute," means a dispute between parties to a commercial transaction which arises out of that transaction.

5. "trading rights," means the right to engage in import or export activities.

ANNEX A

VIETNAM

Exceptions on National Treatment

The provisions of Chapter I, Article 2 are not applied to the following:

1. Special consumption tax on vehicles under 12 seats, inputs of production of cigarettes, and cigars.

2. Supplemental tax on fuels, metals and fertilizers.

The aforementioned exceptions in this Annex (paragraphs 1 and 2) will be eliminated within 3 years from the entry into force of this Agreement.

ANNEX B

VIETNAM

*Note: Phase-out period in Annex B shall be calculated from date of entry into force of this Agreement

Annex B1 - Import Quantitative Restrictions - Agricultural Products
 

Annex B1 - Import Quantitative Restrictions - Industrial Products
 

Annex B2: Export Quantitative Restrictions
 

Annex B3 - Prohibited Imports

1. Cigarettes (except for those as personal effects in prescribed quantity).

2. Used consumer goods (except for transferred assets including goods to service the personal requirements of individuals with diplomatic status of foreign countries, international organizations and personal effects in prescribed quantity).

Cars with right hand drive (including those in unassembled form and those with steering wheel modified prior to importation into Vietnam). As far as self-propelled special-purpose vehicles with right hand drive operating in narrow fields, such as cranes, trench and canal digging machines, garbage trucks, road sweepers, road construction trucks, airport passenger buses, and forklifts are concerned, importation is permitted and the Minister of Trade shall approve when there is demand.

Used spare parts of automobiles of all kinds, motorbikes and motor tricycles - including chassis mounted with used automobile engines of all kinds.

Used internal combustion engines with capacity of less than 30CV.

Motorcycles, scooters and motor tricycles with cylinder of 175 cc and higher. In case of importation for defense, security and professional sports, to be subject to Prime Minister's approval.

Other goods that may be within the scope of an exception set forth in Chapter I or Chapter VII of this Agreement.

Annex B4 - Export Prohibitions

ANNEX C

VIETNAM

Note:

U = Unbound

* Phase-out period in Annex C shall be calculated from the date of entry into force of this Agreement

Annex C1- Imports Subject to State Trading and Phase-Out Schedule
 

Annex C2- Exports Subject to State Trading and Phase-Out Schedule

ANNEX D

VIETNAM

Annex D1- Phase-out Periods for Restrictions on Import

Trading Rights and Distribution Rights -

Agricultural Products

NOTE:

0* = No phase-out period
U = Unbound


* - For purposes of Annex D1, phase-out periods for Import Trading Rights shall begin on the date on which joint ventures are first permitted under Article 2.7.D of Chapter I of this Agreement.

** - For purposes of Annex D1, phase-out periods for Distribution Rights shall begin on the date on which joint ventures are first permitted under Annex G, section IV (Distribution Services) of this Agreement.
 

Annex D1- Phase-out Periods for Restrictions on

Import Trading Rights and Distribution Rights -

Industrial Products

Notes:

0= No phase-out period
U= Unbound
C= Subject to state trading, Annex C
G= Subject to services commitment in Annex G on audio-visual services


* - For purposes of Annex D1, phase-out periods for Import Trading Rights shall begin on the date on which joint ventures are first permitted under Article 2.7.D of Chapter I of this Agreement.

** - For purposes of Annex D1, phase-out periods for Distribution Rights shall begin on the date on which joint ventures are first permitted under Annex G, section IV (Distribution Services) of this Agreement.
 

Annex D2- Phase-Out Periods for Restrictions on Export Trading Rights

Notes:

U=Unbound

*For purposes of Annex D2, phase-out periods for Export Trading Rights shall begin on the date upon which joint ventures are first permitted under Chapter I, Article 2, paragraph 7(D) of this Agreement
 

ANNEX E - TARIFFS


VIETNAM

Tariffs on Agricultural Products

Notes:

* - Tariffs marked with an (*) are to be implemented 6 years from the date of entry into force of this Agreement

Tariffs on Industrial Products- Vietnam

CHAPTER II

INTELLECTUAL PROPERTY RIGHTS


Article 1
Objectives, Principles and Scope of Obligations

1. Each Party shall provide in its territory to the nationals of the other Party adequate and effective protection and enforcement of intellectual property rights.

2. The Parties recognize the underlying public policy objectives of national systems for the protection of intellectual property, including developmental and technological objectives, and ensure that measures to protect and enforce intellectual property rights do not themselves become barriers to legitimate trade.

3. To provide adequate and effective protection and enforcement of intellectual property rights, each Party shall, at a minimum, give effect to this Chapter and the substantive economic provisions of:

A. the Geneva Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of their Phonograms, 1971 (Geneva Convention);

B. the Berne Convention for the Protection of Literary and Artistic Works, 1971 (Berne Convention);

C. the Paris Convention for the Protection of Industrial Property, 1967 (Paris Convention);

D. the International Convention for the Protection of New Varieties of Plants, 1978 (UPOV Convention (1978)), or the International Convention for the Protection of New Varieties of Plants, 1991 (UPOV Convention (1991)); and

E. the Convention Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite (1974).

Article 2
Definitions

For purposes of this Chapter:

1. "confidential information" includes trade secrets, privileged information, and other undisclosed information that has not become subject to an unrestricted public disclosure under the Party's domestic law.

2. "encrypted program-carrying satellite signal" means a program-carrying satellite signal that is transmitted in a form whereby the aural or visual characteristics, or both, are modified or altered for the purpose of preventing the unauthorized reception of a program carried in that signal by persons without the authorized equipment that is designed to eliminate the effects of such modification or alteration.

3. "intellectual property rights" refers to copyrights and related rights, trademarks, patents, layout designs (topographies) of integrated circuits, encrypted program-carrying satellite signals, confidential information (trade secrets), industrial designs and rights in plant varieties.

4. "lawful distributor of an encrypted satellite signal" in a Party means the person who originally transmitted the signal.

5. "national" of a Party shall, in respect of the relevant intellectual property rights, be understood as those natural or legal persons that would meet the criteria for eligibility for protection provided for in the Paris Convention, the Berne Convention, the Geneva Convention, the Convention Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite, the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, the UPOV Convention (1978), the UPOV Convention (1991) or the Treaty on Intellectual Property in Respect of Integrated Circuits adopted at Washington in 1989, as if each Party were a Party to those Conventions, and with respect to intellectual property rights that are not the subject of these Conventions, "national of a Party" shall be understood at least to include any person that is a citizen or permanent resident of that Party.

6. "public" includes, with respect to rights of communication and performance of works provided for under Articles 11, 11bis(1) and 14(1)(ii) of the Berne Convention, with respect to dramatic, dramatico-musical, musical and cinematographic works, at least, any aggregation of individuals intended to be the object of, and capable of perceiving, communications or performances of works, regardless of whether they can do so at the same or different times or in the same or different places, provided that such an aggregation is larger than a family and its immediate circle of acquaintances or is not a group comprising a limited number of individuals having similarly close ties that has not been formed for the principal purpose of receiving such performances and communications of works.

7. "right holder" includes the right holder personally, any other natural or legal person authorized by the right holder who is an exclusive licensee of the right, or other authorized persons, including federations and associations, having legal standing under domestic law to assert such rights.
 

Article 3
National Treatment

1. Each Party shall accord to nationals of the other Party treatment no less favorable than it accords to its own nationals with regard to the acquisition, protection, enjoyment and enforcement of all intellectual property rights and any benefits derived therefrom.

2. A Party shall not, as a condition of according national treatment under this Article, require right holders to comply with any formalities or conditions (including fixation, publication or exploitation in the territory of a Party) in order to acquire, enjoy, enforce and exercise rights or benefits in respect of copyright and related rights.

3. A Party may derogate from paragraph 1 in relation to its judicial and administrative procedures for the protection or enforcement of intellectual property rights, including any procedure requiring a national of the other Party to designate for service of process an address in the Party's territory or to appoint an agent in the Party's territory, if the derogation is consistent with the relevant Convention listed in Article 1.3 above, provided that such derogation:

A. is necessary to secure compliance with measures that are not inconsistent with this Agreement; and

B. is not applied in a manner that would constitute a restriction on trade.

Article 4
Copyright and Related Rights

1. Each Party shall protect all works that embody original expression within the meaning of the Berne Convention. In particular:

A. all types of computer programs are literary works within the meaning of the Berne Convention and each Party shall protect them as such; and

B. compilations of data or other material, whether in machine readable or other form, which by reason of the selection or arrangement of their contents constitute intellectual creations, shall be protected as works.

A. the importation into the Party's territory of copies of the work;

B. the first public distribution of the original and each copy of the work by sale, rental or otherwise;

C. the communication of a work to the public; and

D. the rental of the original or a copy of a computer program for the purposes of commercial advantage.

A. any person acquiring or holding any economic rights may freely and separately transfer such rights by contract; and

B. any person acquiring or holding any such economic rights by virtue of a contract, including contracts of employment underlying the creation of works and sound recordings, shall be able to exercise those rights in its own name and enjoy fully the benefits derived from those rights.

A. the direct or indirect reproduction, in whole or in part, of the sound recording;

B. the importation into the Party's territory of copies of the sound recording;

C. the first public distribution of the original and each copy of the sound recording by sale, rental or otherwise; and

D. the rental, lease or lending of the original or a copy of the sound recording for the purposes of commercial advantage.

A. the fixation of their live musical performances in a sound recording;

B. the reproduction of unauthorized fixations of their live musical performances in a sound recording;

C. the transmission or other communication to the public of sounds in a live musical performance; and

D. the distribution, sale, rental, disposal or transfer of the unauthorized fixations of their live performances in a sound recording, regardless of where the fixations were made.

Article 5
Protection of Encrypted Program-Carrying Satellite Signals

1. For serious violations involving the protection of encrypted program-carrying satellite signals, each Party shall make available appropriate remedies, including civil and criminal remedies.

2. Serious violations involving the protection of encrypted program-carrying satellite signals shall include the following:

A. The manufacture, assembly, modification, or distribution (including import, export, sale or lease) of a device or system, by any person knowing or having reason to know that the device or system is primarily of assistance in the unauthorized decoding of an encrypted program-carrying satellite signal; and

B. The willful receipt or further distribution of an encrypted program-carrying satellite signal that has been decoded without the authorization of the lawful distributor of the signal (regardless of the location of such person) or of any other person or persons designated by the original transmitter as authorized distributors of such signal in such Party.

Article 6
Trademarks

1. For the purposes of this Agreement, a trademark consists of any sign, or any combination of signs, capable of distinguishing the goods or services of one person from those of another, including words, personal names, designs, letters, numerals, combinations of colors, figurative elements or the shape of goods or of their packaging. Trademarks shall include service marks, collective marks and certification marks.

2. Each Party shall provide to the owner of a registered trademark the right to prevent all persons not having the owner's consent from using in commerce identical or similar signs for goods or services that are identical, or similar to those goods or services in respect of which the owner's trademark is registered, where such use would result in a likelihood of confusion. In the case of the use of an identical sign for identical goods or services, a likelihood of confusion shall be presumed. The rights described above shall not prejudice any prior rights, nor shall they affect the possibility of making rights available on the basis of use.

3. A Party may make registrability depend on use. However, actual use of a trademark shall not be a condition for filing an application for registration. Neither Party may refuse an application solely on the ground that intended use has not taken place before the expiry of a period of three years from the date of application for registration.

4. Each Party shall provide a system for the registration of trademarks, which shall include:

A. examination of applications;

B. notice to be given to an applicant of the reasons for the refusal to register a trademark;

C. a reasonable opportunity for the applicant to respond to the notice;

D. publication of each trademark either before or promptly after it is registered; and

E. a reasonable opportunity for interested persons to petition to cancel the registration of a trademark.

Article 7
Patents

1. Subject to the provision of paragraph 2 of this Article, each Party shall make patents available for any invention, whether a product or process, in all fields of technology, provided that such invention is new, resulted from an inventive step and is capable of industrial application. For purposes of this Article, a Party may deem the terms "inventive step" and "capable of industrial application" to be synonymous with the terms "non-obvious" and "useful", respectively.

2. Parties may exclude from patentability:

A. inventions, the prevention within their territory of the commercial exploitation of which is necessary to protect public order or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment, provided that such exclusion is not made merely because the exploitation is prohibited by their law;

B. diagnostic, therapeutic and surgical methods for the treatment of humans or animals;

C. essentially biological processes for the production of plants or animals other than non-biological and microbiological processes; animal varieties; plant varieties. The exclusion for plant varieties is limited to those plant varieties that satisfy the definition provided in Article 1(vi) of the UPOV Convention (1991); such definition shall apply mutatis mutandis to animal varieties. The exclusions for plant and animal varieties shall not apply to plant or animal inventions that could encompass more than one variety. Moreover, the Parties shall provide for the protection of plant varieties by an effective sui generis system in accordance with subparagraph 3.D of Article 1 of this Chapter.

A. where the subject matter of a patent is a product, the patent shall confer on the patent owner the right to prevent other persons from making, using, selling, offering for sale or importing for these purposes the subject matter of the patent, without the patent owner's consent; and

B. where the subject matter of a patent is a process, the patent shall confer on the patent owner the right to prevent other persons from using that process and from using, selling, offering for sale or importing for these purposes at least the product obtained directly by that process, without the patent owner's consent.

A. authorization of such use shall be considered on its individual merits;

B. such use may be permitted only if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder on reasonable commercial terms and conditions and such efforts have not been successful within a reasonable period of time. The requirement to make such efforts may be waived by a Party in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. In situations of national emergency or other circumstances of extreme urgency, the right holder shall, nevertheless, be notified as soon as reasonably practicable. In the case of public non-commercial use, where the government or contractor, without making a patent search, knows or has demonstrable grounds to know that a valid patent is or will be used by or for the government, the right holder shall be informed promptly;

C. the scope and duration of such use shall be limited to the purpose for which it was authorized, and in the case of semiconductor technology shall only be for public non-commercial use or to remedy a practice determined after judicial or administrative process to be anti-competitive;

D. such use shall be non-exclusive;

E. such use shall be non-assignable, except with that part of the enterprise or goodwill that enjoys such use;

F. any such use shall be authorized predominantly for the supply of the Party's domestic market;

G. authorization for such use shall be liable, subject to adequate protection of the legitimate interests of the persons so authorized, to be terminated if and when the circumstances that led to it cease to exist and are unlikely to recur. The competent authority shall have the authority to review, on petition of an interested party, the continued existence of these circumstances;

H. the right holder shall be paid adequate remuneration in the circumstances of each case, taking into account the economic value of the authorization;

I. the legal validity of any decision relating to the authorization shall be subject to judicial or other independent review by a distinct higher authority;

J. any decision relating to the remuneration provided in respect of such use shall be subject to judicial or other independent review by a distinct higher authority;

K. the Party shall not be obliged to apply the conditions set out in subparagraphs B and F of this Article where such use is permitted to remedy a practice determined after judicial or administrative process to be anticompetitive. The need to correct anti-competitive practices may be taken into account in determining the amount of remuneration in such cases. Competent authorities shall have the authority to refuse termination of authorization if and when the conditions that led to such authorization are likely to recur; and

L. the Party shall not authorize the use of the subject matter of a patent to permit the exploitation of another patent except as a remedy for an adjudicated violation of domestic laws regarding anticompetitive practices.

A. the product obtained by the patented process is new; or

B. a substantial likelihood exists that the allegedly infringing product was made by the process and the patent owner has been unable through reasonable efforts to determine the process actually used.

Article 8
Layout Designs (Topographies) of Integrated Circuits

1. Each Party shall protect layout designs (topographies) of integrated circuits ("layout designs") in accordance with Articles 2 through 7, 12 and 16(3), other than Article 6(3), of the Treaty on Intellectual Property in Respect of Integrated Circuits as opened for signature on May 26, 1989, and, in addition, shall comply with the provisions of paragraphs 2 through 8 of this Article.

2. Subject to paragraph 3, each Party shall make it unlawful for any person without the right holder's authorization to reproduce, import or distribute a protected layout design, an integrated circuit in which a protected layout design is incorporated, or an article incorporating such an integrated circuit only insofar as it continues to contain an unlawfully reproduced layout design.

3. Neither Party may make unlawful any of the acts referred to in paragraph 2 performed in respect of an integrated circuit that incorporates an unlawfully reproduced layout design, or any article that incorporates such an integrated circuit, where the person performing those acts or ordering those acts to be done did not know and had no reasonable ground to know, when it acquired the integrated circuit or article incorporating such an integrated circuit, that it incorporated an unlawfully reproduced layout design.

4. Each Party shall provide that, after the person referred to in paragraph 3 has received sufficient notice that the layout design was unlawfully reproduced, such person may perform any of the acts with respect to the stock on hand or ordered before such notice, but shall be liable to pay the right holder for doing so an amount equivalent to a reasonable royalty such as would be payable under a freely negotiated license in respect of such a layout design.

5. Neither Party may permit the compulsory licensing of layout designs of integrated circuits.

6. Any Party that requires registration as a condition for protection of a layout design shall provide that the term of protection shall not end before the expiration of a period of 10 years counted from the date of filing an application for registration or from the date on which the layout design is first commercially exploited in the world, whichever occurs first.

7. Where a Party does not require registration as a condition for protection of a layout design, the Party shall provide a term of protection of not less than 10 years from the date of the first commercial exploitation of the layout design, wherever in the world it occurs.

8. Notwithstanding paragraphs 6 and 7, a Party may provide that the protection shall lapse 15 years after the creation of the layout design.
 

Article 9
Confidential Information (Trade Secrets)

1. In the course of ensuring effective protection against unfair competition as provided in Article 10bis of the Paris Convention (1967), each Party shall protect confidential information in accordance with paragraph 2 below and data submitted to government or governmental agencies in accordance with paragraphs 5 and 6 below.

2. Each Party shall provide the legal means for any person to prevent confidential information from being disclosed to, acquired by, or used by others without the consent of the person lawfully in control of the information in a manner contrary to honest commercial practices, in so far as, and for so long as:

A. the information is not generally known or readily ascertainable;

B. the information has commercial value because it is secret; and

C. the person lawfully in control of the information has taken reasonable steps under the circumstances to keep it secret.

Article 10
Industrial Designs

1. Each Party shall provide for the protection of independently created industrial designs that are new or original. A Party may provide that:

A. designs are not new or original if they do not significantly differ from known designs or combinations of known design features; and

B. such protection shall not extend to designs dictated essentially by technical or functional considerations.

Article 11
Enforcement of Intellectual Property Rights

1. As specified in this Article and Articles 12 through 15 hereof, each Party shall provide procedures in its domestic law that permit effective action against infringement of the intellectual property rights covered by this Chapter. These procedures shall include expeditious remedies to prevent infringement and remedies substantial enough to deter future infringement. Each Party shall apply enforcement procedures in a manner that does not create barriers to legitimate trade and contains effective safeguards against abuse.

2. Each Party shall ensure that its enforcement procedures are fair and equitable, are not unnecessarily complicated or costly, and do not entail unreasonable time limits or unwarranted delays.

3. Each Party shall ensure that decisions on the merits of a case in judicial and administrative enforcement proceedings are:

A. in writing and state the reasons on which the decisions are based;

B. made available without undue delay at least to the parties in a proceeding; and

C. based only on evidence in respect of which such parties were offered the opportunity to be heard.

Article 12
Specific Procedural and Remedial Aspects of Civil
and Administrative Procedures

1. Each Party shall make available to right holders civil judicial procedures for the enforcement of any intellectual property right covered by this Agreement. Each Party shall provide that:

A. defendants have the right to written notice that is timely and contains sufficient detail, including the basis of the claims;

B. parties in a proceeding are allowed to be represented by independent legal counsel;

C. enforcement procedures do not include imposition of overly burdensome requirements concerning mandatory personal appearances;

D. all parties in a proceeding are duly entitled to substantiate their claims and to present relevant evidence; and

E. the procedures include a means to identify and protect confidential information.

A.where a party in a proceeding has presented reasonably available evidence sufficient to support its claims and has specified evidence relevant to the substantiation of its claims that is within the control of the opposing party, to order the opposing party to produce such evidence, subject in appropriate cases to conditions that ensure the protection of confidential information;

B. where a party in a proceeding voluntarily and without good reason refuses access to, or otherwise does not provide relevant evidence under that party's control within a reasonable period, or significantly impedes a proceeding relating to an enforcement action, to make preliminary and final determinations, affirmative or negative, on the basis of the evidence presented, including the complaint or the allegation presented by the party adversely affected by the denial of access to evidence, subject to providing the parties an opportunity to be heard on the allegations or evidence;

C. to order a party in a proceeding to desist from an infringement, including measures to prevent the entry into the channels of commerce of imported goods that involve the infringement of an intellectual property right, immediately after customs clearance of such goods.

D. to order the infringer of an intellectual property right to pay the right holder damages adequate to compensate for the injury the right holder has suffered because of the infringement and the profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages;

E. to order an infringer of an intellectual property right to pay the right holder's expenses, which may include appropriate attorney's fees; and

F. to order a party in a proceeding at whose request measures were taken and who has abused enforcement procedures to provide adequate compensation to any party wrongfully enjoined or restrained in the proceeding for the injury suffered because of such abuse and to pay that party's expenses, which may include appropriate attorney's fees.

A. goods that they have found to be infringing be, without compensation of any sort, disposed of outside the channels of commerce in such a manner as to avoid any injury caused to the right holder or, unless this would be contrary to existing constitutional requirements, destroyed; and

B. materials and implements the predominant use of which has been in the creation of the infringing goods be, without compensation of any sort, disposed of outside the channels of commerce in such a manner as to minimize the risks of further infringements.

C. In considering whether to issue such an order, judicial authorities shall take into account
the need for proportionality between the seriousness of the infringement and the remedies
ordered, as well as the interests of other persons. In regard to counterfeit trademark goods,
the simple removal of the trademark unlawfully affixed shall not be sufficient, other than
in exceptional cases, to permit release of the goods into the channels of commerce.

Article 13
Provisional Measures

1. Each Party shall authorize its judicial authorities to order prompt and effective provisional measures:

A. to prevent an infringement of any intellectual property right, and in particular to prevent the entry into the channels of commerce in their jurisdiction of allegedly infringing goods, including imported goods immediately after customs clearance; and

B. to preserve relevant evidence in regard to the alleged infringement.