Common use of Preferences under other Agreements Clause in Contracts

Preferences under other Agreements. 1. Except for Article 908 (2), Article 917 (3) and Article 1605, nothing in this Agreement shall be regarded as obliging a Party to extend to the other Party the benefit of any treatment, preference or privilege arising from any existing or any future customs union, free trade area, free trade arrangement, common market, monetary union or similar international agreement or other similar forms of bilateral or regional cooperation to which either of the Parties is or may become party; or as preventing the adoption of an agreement designed to lead to the formation or extension of such a union, area or arrangement or market. 2. Where, by virtue of the Annex on Article II Exemptions to GATS, a Party is exempt from the obligations of Paragraph 1 of Article II of GATS in relation to an agreement or arrangement with a non-Party, nothing in this Agreement shall be regarded as obliging that Party to extend to the other Party the benefit of any treatment, preference or privilege arising from such agreement or arrangement. This Paragraph applies whether or not the treatment, preference or privilege under that agreement or arrangement would itself be subject to the obligations of Paragraph 1 of Article II of GATS except for the Annex on Article II Exemptions to GATS.