WORLD TRADE
ORGANIZATIONWT/REG126/5
30 October 2003
(03-5792)
Committee on Regional Trade Agreements Original:  English
FREE TRADE AGREEMENT BETWEEN THE EFTA STATES AND MEXICO
Questions and Replies
This document reproduces the questions addressed to the Parties and the responses submitted.
The questions and replies set out below are organized in accordance with document WT/REG126/3
and WT/REG126/4.
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I. BACKGROUND INFORMATION TO THE AGREEMENT
3. Scope
In addition to the tariff differential and/ or enhanced services commitments created by
the elimination of duties in the context of the FTA, does the Agreement have other provisions
that affect the comparative economic market access opportunity of countries that are not
parties to the Agreement?
The FTA provides for a clear legal framework that furthers progressive trade liberalization
beyond commitments achieved in the Uruguay Round.  Fo r example, tariff elimination provided for in
the FTA, goes further than the tariff elimination agreed under WTO.  In our view, the elimination of
trade obstacles through the FTA does not hinder trade with countries that are not parties to theAgreement.  On the contrary, the FTA contributes to the deepening of trade liberalization as well as to
the creation of incentives for economic growth and increased trade flows both at the regional and
multilateral level.  The active participation of the Parties in the WTO demonstrates their strong
commitment to the promotion of multilateral trade liberalization.
II. TRADE PROVISIONS
8. Sector-Specific Provisions
8.1 Agriculture
WT/REG126/3 indicates that agricultural libera lization will take place within the limits
of tariff rate quotas (TRQs).  How do these quotas provide for substantial liberalization?  Have
the TRQs been liberalized?  Is there a timetable fo r their elimination and incorporation of these
products in the general liberalization?  If so, please describe it.
Trade in agricultural products is covered in three bilateral agricultural agreements negotiated
between the respective EFTA State (Iceland, Norway  and Switzerland/Liechtenstein), which form part
of the instruments establishing the free trade area.  Each of these agreements provides for duty-free orWT/REG126/5
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preferential treatment for agricultural products in accordance with annexes to the respective
agreement.  The trade liberalization in the agreemen ts is generally not subject to any tariff quotas.
One of the bilateral agreements however stipulates, for only few of the products for which trade is
liberalized, that that preferential treatment will only be granted within the quantities of erga omnes
applied (WTO) tariff quota.  These quotas have not been liberalized in the agreement and no timetablehas been set for their elimination.
II. PROVISIONS AFFECTING TRADE IN SERVICES
1. Provisions In The Agreement Which Are Relevant To The Scope Of The GATS
Par Article 24.3 of the Agreement, the Joint Committee is to adopt a decision providing
for the elimination of substantially all remaining discrimination, containing a list ofcommitments establishing the level of liberalization.
Will this list of commitments cover all four modes of supply as is the case with the list of
commitments under GATS, and be on the positive-list basis?
The list of commitments will cover all four modes of supply (Article 19).
In a record of understanding at the time of the signature of the Agreement, the Parties have
agreed that the list of commitments shall consist of a “negative list”, setting out the exceptions of each
Party to the elimination of substantially all remain ing discrimination that each Party will retain after
the end of the transitional period (referred to in paragraph 3).  However, the basis for the lists ofcommitments can be discussed again when the Par ties no later than 3 years following the entry into
force of the Agreement will take a decisions containing a list of commitments establishing the level of
liberalisation and a liberalisation calendar in order to reach the elimination of substantially all the
discrimination (cf. Article  24).
6. Government Procurement
How do the FTA government procurement provisions and scope of liberalization
compare to those of the plurilateral GPA?
The EFTA States, being members of the WTO GPA Agreement, use the GPA as their basis
for their concessions whereas Mexico, being a member of the NAFTA Agreement, uses NAFTA as its
basis for their concessions.  Entities at the sub-central level are not part of the NAFTA Agreement,and they are therefore not included in the FTA between EFTA and Mexico.  The guiding principle of
the Agreement on government procurement is reciprocity.
Mexico will provide access to EFTA suppliers under the same conditions as for suppliers
from the European Union, United States or Canada.  In return, the EFTA States will grant similaraccess as under the WTO Government Procurement Agreement (GPA), excluding the sub-central
level.
Article 67 opens for further negotiations if one of the parties offers additional advantages to
other countries.  This has so far not happened.WT/REG126/5
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IV. OTHER
4. Competition
How does cooperation on competition work in practice? Context?
Article 51 to 55 and Annex XI.  The Agreement includes provisions on co-operation and
exchange of information with the aim of ensuring  and facilitating the enforcement of the Parties'
respective competition laws.
Article 52 provides that a Party shall notify the other Party of competition enforcement
activities that may affect important interests of that other Party.  This information will usually be
handled by the respective competition authorities but may be channelled through the responsible
authorities for free trade relations.
Such activities may include investigations that involve: anticompetitive business conduct,
remedies and seeking of information in the territory of the other Party, as well as mergers and
acquisitions in which a party to the transaction is a company of a Party controlling a company
established in the territory of the other Party.  Notifications shall be sufficiently detailed to enable thenotified Party to make an initial evaluation of the effect of the enforcement activity within its territory.
If a Party considers that an anticompetitive business conduct carried out within the territory of the
other Party has an appreciable adverse effect within its territory, it may request that the other Party
initiate appropriate enforcement activities.  The request shall be as specific as possible about the
nature of the anticompetitive business conduct and its effect within the territory of the requestingParty, and shall include an offer of such further information and other cooperation as the requesting
Party is able to provide.
The requested Party shall carefully consider whether to initiate enforcement activities, or to
expand ongoing enforcement activities, with respect to the anticompetitive business conduct identifiedin the request. The requested Party shall advise the requesting Party of the outcome of the
enforcement activities and, to the extent possible, of significant interim developments.
Have there been any requests for enforcement?  From whom?
No requests were received by any Party to the Agreement from another Party to the
Agreement so far.
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