Penalties
۱. A contractor's rights under the contract may be suspended or terminated only in the following cases:
(a) if, in spite of warnings by the Authority, the contractor has conducted his activities in such a way as to result in serious, persistent and wilful violations of the fundamental terms of the contract, Part XI and the rules, regulations and procedures of the Authority; or
(b) if the contractor has failed to comply with a final binding decision of the dispute settlement body applicable to him.
۲. In the case of any violation of the contract not covered by paragraph ۱(a), or in lieu of suspension or termination under paragraph ۱(a), the Authority may impose upon the contractor monetary penalties proportionate to the seriousness of the violation.
۳. Except for emergency orders under article ۱۶۲, paragraph ۲(w), the Authority may not execute a decision involving monetary penalties, suspension or termination until the contractor has been accorded a reasonable opportunity to exhaust the judicial remedies available to him pursuant to Part XI, section ۵.