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Objective, scope and coverage



 

1. The Parties, reaffirming their respective rights and obligations 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. Government procurement is dealt with by Chapter 8 (Government Procurement) of Title IV [of this Agreement] and nothing in this Chapter shall be construed to impose any obligation with respect to government procurement.

 

3. Subsidies are dealt with by Chapter 10 (Competition) of Title IV [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


 

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

 

Without prejudice to the provisions on movement of persons in the Title III Justice Freedom and Security [of this Agreement], 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 the Chapter11.

 

 

Article 86

 

Definitions

 

For the purposes of this Chapter:

 

1. "measure" means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;

 

2. "measures adopted or maintained by a Party" means measures taken by:

 

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

 

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

 

3. a "natural person of a Party" means a national of an EU Member State or a national of Ukraine according to its respective legislation;

 

4. "legal person" means any legal entity duly constituted or otherwise organized 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;



 

5. a "legal person of the EU Party" or a "legal person of Ukraine" means:

 

a legal person set up in accordance with the laws of a Member State of the European Union or of Ukraine respectively, and having its registered office, central administration, or principal place of business in the territory to which the Treaty on the Functioning of the European Union applies or in the territory of Ukraine, respectively;

 

Should this legal 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 Ukraine respectively, it shall not be considered as a legal person of the EU Party or a legal person of Ukraine respectively, unless its operations possess a

 

 

11 The sole fact of requiring a visa for natural persons of certain countries and not for those of others shall not be regarded as nullifying or impairing benefits under the Agreement.


 

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real and continuous link with the economy of the EU Party or of Ukraine, respectively;

 

6. Notwithstanding the preceding paragraph, shipping companies established outside the EU Party or Ukraine and controlled by nationals of a Member State of the European Union or of Ukraine, respectively, shall also be beneficiaries of the provisions of this Agreement, if their vessels are registered in accordance with their respective legislation, in that Member State or in Ukraine and carry the flag of a Member State or of Ukraine;

 

7. "subsidiary" of a legal person of a Party means a legal person which is effectively controlled by another legal person of that Party12;

 

8. "branch" of a legal person means a place of business not having legal personality which:

 

(a) has the appearance of permanency such as the extension of a parent body;

 

(b) has a management structure; and

 

(c) 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;

 

9. "establishment" means:

 

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

 

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

 

10. "investor" means any natural or legal person of a Party that seeks to perform or performs an economic activity through setting up an establishment;

 

11. "economic activities" includes activities of an industrial, commercial and professional character and activities of craftsmen and do not include activities performed in the exercise of governmental authority;

 

12. "operations" means the pursuit of economic activities;

 

13. "services" includes any service in any sector except services supplied in the exercise of governmental authority;

 

12 A legal person is controlled by another legal person if the latter has the power to name a majority of its directors or otherwise to legally direct its actions.


 

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14. "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;

 

15. "cross-border supply of services" means the supply of a service:

 

(a) from the territory of a Party into the territory of the other Party;

 

(b) in the territory of a Party to the service consumer of the other Party.

 

16. "service supplier" of a Party means any natural or legal person of a Party that seeks to supply or supplies a service, including through an establishment;

 

17. "key personnel" means natural persons employed within a legal person of one Party other than a non-profit organisation and who are responsible for the setting-up or the proper control, administration and operation of an establishment.

 

"Key personnel" comprise business visitors responsible for setting up an establishment and intra-corporate transfers.

 

(a) "Business visitors" means natural persons working in a senior position who are responsible for setting up an establishment. They do not engage in direct transactions with the general public and do not receive remuneration from a source located within the host Party;

 

(b) "Intra-corporate transfers" means natural persons who have been employed by a legal person of one Party or have been partners in it (other than as majority shareholders) for at least one year and who are temporarily transferred to an establishment in the territory of the other Party. The natural person concerned must belong one of the following categories:

 

(i) Managers:

 

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

 

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

 

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

 

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

 

(ii) Specialists:

 

Persons working within a legal person, who possess uncommon knowledge essential to the establishment’s production, research equipment, techniques 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


 

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high level of qualification referring to a type of work or trade requiring specific technical knowledge, including membership of an accredited profession.

 

18. "graduate trainees" means natural persons of a Party who have been employed by a legal person of that Party for at least one year, possess a university degree and are temporarily transferred to an establishment in the territory of the other Party for career development purposes or to obtain training in business techniques or methods13;

 

19. "business services sellers" means natural persons who are representatives of a service supplier of one Party seeking entry and temporary stay into the territory of the other Party for the purpose of negotiating the sale of services or entering into agreements to sell services for that service 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;

 

20. "contractual services suppliers" means natural persons employed by a legal person of one Party which has no establishment in the territory of the other Party and which has concluded a bona fide contract14 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;

 

21. "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 contract15 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.

 

Section 2

 

Establishment

 

 

Article 87

 

Scope

 

This Section applies to measures adopted or maintained by the Parties affecting establishment16 in all economic activities with the exception of:

 

(a) mining, manufacturing and processing17 of nuclear materials;

 

 

13 The recipient establishment may be required to submit a training programme covering the duration of stay for prior approval, demonstrating that the purpose of the stay is for training. The competent authorities may require that the training be linked to the university degree which has been obtained.

14 The service contract shall comply with the laws, regulations and legal requirements of the Party where the contract is executed.

15 The service contract shall comply with the laws, regulations and legal requirements of the Party where the contract is executed.

16 Investment protection, other than the treatment deriving from Article 88 (National treatment), including investor-state dispute settlement procedure, is not covered by this Chapter.


 

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

 

(c) audio-visual services;

 

(d) national maritime cabotage18, and

 

(e) domestic and international air transport services19, 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 (hereinafter referred to as "CRS") services;

 

(iv) ground handling services;

 

(v) airport operation services.

 

 

Article 88

 





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