Common use of Bilateral Emergency Actions Clause in Contracts

Bilateral Emergency Actions. 1. If, as a result of the reduction or elimination of a duty under this Agreement, a textile or apparel good benefiting from preferential tariff treatment under this Agreement is being imported into the territory of a Party in such increased quantities, in absolute terms or relative to the domestic market for that good, and under such conditions as to cause serious damage, or actual threat thereof, to a domestic industry producing a like or directly competitive good, the importing Party may, to the extent and for such time as may be necessary to prevent or remedy such damage and to facilitate adjustment by the domestic industry: (a) suspend the further reduction of any rate of customs duty on the good provided for under this Agreement; or (b) increase the rate of customs duty on the good to a level not to exceed the lesser of (i) the most-favored-nation (MFN) applied rate of duty on the good in effect at the time the action is taken; and (ii) the MFN applied rate of duty on the good in effect on the date this Agreement enters into force. 2. In determining serious damage, or actual threat thereof, the importing Party: (a) shall examine the effect of increased imports of the good from the exporting Party on the particular industry, as reflected in changes in such relevant economic variables as output, productivity, utilization of capacity, inventories, market share, exports, wages, employment, domestic prices, profits, and investment, none of which is necessarily decisive; and (b) shall not consider changes in technology or consumer preference as factors supporting a determination of serious damage or actual threat thereof. 3. The importing Party may take an emergency action under this Article only following an investigation. The importing Party shall: (a) carry out any investigation under this Article in accordance with procedures it has established; and (b) transmit its procedures to the other Party on the date this Agreement enters into force or before it initiates an investigation under this Article. 4. The importing Party shall deliver to the exporting Party, without delay, written notice of its intent to take emergency action and, on the request of the exporting Party, shall enter into consultations with that Party regarding the matter.