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1 PREAMBLE The Bureau of Standards, Metrology and Inspection (BSMI) underthe jurisdiction of the Ministry of Economic Affairs, having itsaddress at 4 Chinan Road, Section 1, Taipei, 100, Taiwan, Repub-lic of China (R.O.C.), and the Japan Quality Assurance Organiza-tion (JQA), a corporation incorporated under the laws of Japanand having its principal place of business at 1-9-15, Akasaka,Minato-ku, Tokyo 107-0052 Japan.The parties both conduct asse-ssments of clients' quality management systems and register suchsystems in accordance with international standards and requirem-ents. The parties recognize the need to effectively respond torequests for registration of quality management systems and tominimize the costs and burdens on clients requesting such regis-tration.This MOU outlines the arrangements between BSMI and J-QA to facilitate the process of assessing and registering quali-ty management systems. 1.0 PURPOSE 1.1 This MOU is to provide a mechanism whereby BSMI and JQA willcooperate to respond efficiently to requests for registrati-on and to minimize costs and burdens on clients in the asse-ssments and registration of quality management systems acco-rding to the International Organization for Standardization's ISO 9001:2000 Standard and other comparable standards suchas JISQ9001, CNS 12681, etc. 2.0 SCOPE 2.1 Both BSMI and JQA intend to offer their services to evaluateand register client's quality management systems. 2.2 This MOU applies to the following situations: (1) Clients seeking registration of their quality managementsystems from both parties. (2) Quality management systems first registered by one partyto this MOU may be recognized for joint registration by the other party subject to reasonable verification and investigation of the particular registration conducted pursuant to this MOU. 2.3 A client should apply for registration to the party locatedin the same country as the client.This party shall be the Primary Registrar and shall be responsible for the assessme-nt and surveillance.The other party may send its personnelto participate in the assessment and surveillance as observ-er in order to understand the on-site operation. 2.4 Upon successful completion of an assessment, the party perf-orming the assessment shall share the results of its work w-ith the other party for the purpose of the other party issu-ing its certificate of registration. Each party reserves theright to comment or request additional information before a-ccepting the results of the other's assessment. 3.0 REQUIREMENTS 3.1 TRAINING AND QUALIFICATIONS 3.1.1 Lead Assessors and Assessors must meet the minimum criter-ia in accordance with currently accepted practices and gu-idelines as followed by other qualified Registrars and ot-her international standards and practices. 3.2 JOINT APPLICATION PROCEDURES 3.2.1 Separate applications and initial information data will berequired for the BSMI and JQA registration programs. Eith-er party may accept applications and initial information forms on the other's behalf, provided such information is necessary and in accordance with both parties' registrati-on programs. 3.2.2 A client seeking registration must submit documents descr-ibing its quality to the Primary Registrar. 3.2.3 The Lead Assessor of the assessment team will schedule thevisit with the client seeking registration at a time mutu-ally convenient for the client and the assessment team. T-he Lead Assessor will also be responsible for the coordin-ation of arrangements, paperwork, etc., between the parti-es. All such arrangements must be mutually acceptable to each party. 3.2.4 Each party shall have the right to conduct the necessaryverification and investigation for its registration and s-hall have the right to determine the process relating to its registration. 3.3 CERTIFICATES 3.3.1 Each party will be responsible for issuance and control ofits certificate of registration. 3.3.2 In the event that joint registration is in effect, each p-arty agrees to notify the other if the client's use or di-splay of the other's certificate of registration and mark (s) is improper. 3.4 SURVEILLANCE VISITS 3.4.1 Follow-up visits shall be conducted by the Primary Regist-rar. 3.4.2 In the event of joint registration, routine follow-up vis-its will be scheduled and conducted annually. 3.5 FINANCIAL CONSIDERATIONS Each party will independently determine and administer itsprogram of financial charges associated with assessment and registration. Accordingly, each party shall separately invo-ice the client seeking registration, for its charges for theassessment and registration.Each party shall bear its own costs and expenses incurred in the assessment and registrat-ion. 3.6 INDEMNIFICATION 3.6.1 BSMI shall indemnify and hold harmless JQA, its successorsand assignees, directors, officers, agents, and employees against in respect of any and all damages, claims, losses,liabilities, expenses, fines, penalties, or suits of what-ever nature, from third parties which may, solely by an a-ct or omission of BSMI's, arise as a causal consequence o-ut of: (i) any breach or violation of this MOU by BSMI; (ii) any negligent, fraudulent, defective, or delayed perfo-rmance of BSMI's obligations under this MOU; and (iii) anynegligent or willful misrepresentation in any certificate of document delivered in conjunction with this MOU by BSMIwhich is not caused by JQA. Said indemnification also sha-ll include all legal fees and defense expenses incurred bythe indemnitee unless otherwise specified herein. 3.6.2 JQA shall indemnify and hold harmless BSMI, its successorsand assignees, officers, agents, and employees, and the R.O.C. government and the employees of the R.O.C. government, against in respect of any and all damages, claims, loss-es, liabilities, expenses, fines, penalties, or suits of whatever nature, from third parties which may, solely by an act or omission of JQA's, arise as a causal consequenceout of: (i) any breach or violation of this MOU by JQA; (ii) any negligent, fraudulent, defective, or delayed perfo-rmance of JQA's obligations under this MOU; and (iii) any negligent or willful misrepresentation in any certificate of document delivered in conjunction with this MOU by JQA which is not caused by BSMI. Said indemnification also sh-all include all legal fees and defense expenses incurred by the indemnitee unless otherwise specified herein. 3.6.3 Upon obtaining knowledge of facts which, in JQA's or BSMI's (as applicable, the "indemnitee") sole discretion, are determined to be sufficient to justify a claim for indemn-ification under this MOU, BSMI or JQA (the " indemnitee"),shall promptly notify the other party (the "indemnitor") in writing of any damage, claim, loss, liability, expense,fine, penalty or suit which the indemnitee has determined has given or could give rise to a claim under 3.6.1 or 3. 6.2 above (such written notice being a "Notice of Claim").A Notice of Claim shall specify, in reasonable detail, thenature of any such claims, and all facts relevant thereto,giving rise to a claim for indemnification and describing all action taken and to be taken by the indemnitee in res-ponse to such claim. 3.6.4 With respect to any claim or demand set forth in a Noticeof Claim, the indemnitor may defend, in good faith and at its expense, any such claim or demand, and the indemnitee,at its expense, shall have the right to participate in thedefense of any such claim.So long as the indemnitor is defending in good faith any such claim, the indemnitee sh-all not settle or compromise such claim without consent ofthe indemnitor.The indemnitee shall make available to t-he indemnitor or its representatives all records and othermaterials reasonably required to contest any claim, and s-hall cooperate fully with the indemnitor in the defense ofall such claims.If the indemnitor does not elect to def-end any such claim, the indemnitee shall have no obligati-on to do so.The indemnitor's obligation under 3.6.1 or 3.6.2 above shall not be affected in any way by its electi-on to defend or not defend any such claim. 3.6.5 Notwithstanding 3.6.3 and 3.6.4 above, the parties acknow-ledge that use of internal legal staff may be most cost-e-ffective and able to provide the best defense.Therefore,the indemnitee shall have the right to utilize, at its op-tion, its own internal legal staff, if any, to participatein the defense or to defend itself (as the case may be de-pending upon whether the indemnitor elects to defend purs-uant to 3.6.4 above) and to retain local counsel, if and when appropriate.The indemnitor shall have no responsib-ility to pay for any portion of a staff attorney's salary,counsel's time, or time spent in defending said damages a-nd claim; all other defense expenses shall be reimbursed. 3.7 ADVERTISING 3.7.1 It is not intended by this MOU that (a) BSMI be or referto itself as a JQA "accredited" party or any similar desc-ription or that (b) JQA be or refer to itself as a BSMI " accredited" party or any other similar description. Neith-er party shall refer to or use the other's name or Mark inany advertising, orally or in written materials, without the other's prior consent in writing. 3.8 AGENCY NOT CREATED 3.8.1 Neither party is authorized by this MOU to incur obligati-ons on behalf of the other party or to bind the other par-ty in any respect. 3.9 INDEPENDENT ORGANIZATION 3.9.1 BSMI and JQA are independent organizations not affiliatedwith nor influenced or controlled by customers in any man-ner which might affect their capacity to render assessmen-ts and registrations objectively and without bias. Specif-ically, they comply with all of the following: (A) No managerial affiliation with customers. (B) Results of their work accrue no financial benefits to any customers, via stock ownership or the like. (C) Sufficient breadth of interest or activity that the l-oss or award of a specific contract to assess a custo- mer's quality management system with the applicable s- tandard would not be a determinative factor in its fi- nancial well-being. (D) Employment security status of its personnel is free ofinfluence or control of customers. 4.0 GOVERNING LAW AND JURISDICTION 4.0.1 This MOU shall be governed by and construed in accordancewith the laws of England.The parties hereto shall striveto settle any disputes amicably between themselves. Any c-ontroversy or claim arising under, out of, in connection with, or relating to this MOU which cannot be settled ami-cably shall be subject to the jurisdiction of the Taipei District Court in case that the suit is instituted by JQA and subject to the jurisdiction of Tokyo District Court incase that the suit is instituted by BSMI. 5.0 GENERAL 5.0.1 Both parties will provide the public with non-proprietaryinformation about quality management registration programsand answer general questions. 5.0.2 Both parties will furnish the other with all necessary in-formation reasonably required to ensure the effectiveness of this MOU.Each party will refrain, without the client's prior authorization in writing, from voluntarily disclo-sing to third parties secret information which is obtainedby BSMI or JQA in confidence from the client. 5.0.3 In the event where either party does not adhere to any ofthe items stated in this MOU, the other party shall bring it to the attention of the other for corrective action. 5.0.4 This MOU, written in duplicate in the English language, shall come into effect upon signing by both Parties and shall remain effective until a notice of termination is g-iven by either party.Termination of this MOU shall be bywritten notice at least 90 days prior to the effective da-te of termination. For:Bureau of Standards,For:Japan Quality AssuranceMetrology Organization (JQA) and Inspection (BSMI) Shiuh-Tung Chikafumi Morita By:___________________By:___________________for:Shiuh-Tung WuChikafumi Morita Director Executive Board Director Neng-Jong Lin Kenji Sakuma By:___________________By:___________________Neng-Jong Lin Kenji Sakuma Director GeneralPresident and CEO Date:february 8,2002Date:February 14,2002