RESTRICTED
WORLD TRADE WT/COMTD/1/Add.4
14August 1996
ORGANIZATION(96-3219)
Original: Spanish
SOUTHERN COMMON MARKET (MERCOSUR) AGREEMENT
Questions andreplies1
Addendum
Thefollowing communication, dated 30April 1996, hasbeenreceived from thePermanent
Mission ofArgentina.
_______________
Initscapacity ofPro-Tempore Chairman ofMERCOSUR, theArgentine Government transmits
herewith replies totheadditional questions puttoMERCOSUR during themeeting oftheWorking
Party onMERCOSUR heldon10and11October 1995.2
1Whenever feasible, questions andcomments were grouped under headings which refer tothenumbering
ofquestions indocument WT/COMTD/1, of2May 1995.
2ThetextsoftheDecisions, Resolutions, etc.mentioned inthereplies havebeentransmitted totheSecretariat
sothatinterested delegations mayconsult them (office 3006). Alistofthese textsisgiven intheAnnex tothis
document.WT/COMTD/1/Add.4
Page2
I. ELIMINATION OFDUTIES, CHARGES AND OTHER RESTRICTIONS APPLIED
INTHE STATES PARTIES 'TRADE
1. Could theParties explain thecriteria forselecting products forinclusion intheAdaptation
Regime?
2. Wastheceiling foreseen forthenational exceptions of300products eachforArgentina,
Brazil andUruguay and399products forParaguay reached? Canthisceiling bechanged?
3. Could theParties provide acomplete listoftheheadings oftheHarmonized System that
arestillnotdutyfree? Could theyindicate thetrade volume involved foreachofthese products?
4. Please provide adescription oftheextent towhich theduties, charges andother measures
havealready beeneliminated ontheParties 'reciprocal trade. Please listsectors orproducts which
arestillprotected, either bytariffs orbynon-tariff barriers, andthecurrent schedule forthe
removal oftheremaining barriers.
5. TheParties explained thatintheautomotive sector, anadhoctechnical committee was
setuptodraft aproposal foracommon MERCOSUR regime. CantheParties clarify whether
theMERCOSUR regime leads totheelimination ofduties andother restrictive regulations of
commerce withregard totheautomotive trade between constituent territories ofthecustoms union?
6. Asstipulated inGATT Article XXIV.8, acustoms union isrequired toeliminate duties
andother restrictive regulations ofcommerce withrespect tosubstantially allthetrade between
theconstituent territories oftheUnion.
(a) Concerning theexceptions totheelimination ofduties onreciprocal trade between
theStates Parties:
(i) Could MERCOSUR provide alistofthose tariff linestobeexempted, the
trade dataofthose products indicating their share inthewhole reciprocal
trade?
(ii) Could MERCOSUR explain thecriteria forexempting those products?
(b) With respect totheexceptions totheelimination ofother restrictive regulations
ofcommerce,couldStatesPartiestotheMERCOSURprovidealistoftheexempted
restrictive regulations?
(i) With respect torestrictions subject toaharmonization process, could the
States Parties totheMERCOSUR provide alistofthose restrictions?
(ii) Please explain thecriteria forexempting those regulations.
(iii) Could States Parties totheMERCOSUR indicate thetime-frame ofthe
elimination/harmonization oftherelevant regulations?
7. Annex II(restrictions forlimitation/harmonization bySubgroups) listsliterally hundreds
ofmeasures thatareeither slated forelimination orharmonization.WT/COMTD/1/Add.4
Page3
(a) Atwhat stage isthisprocess? Have import restrictions identified inAnnex IIby
theCommon Market Subgroups been eliminated orharmonized byallthe
MERCOSUR Parties?
(b) What precisely does thecitation ofaregulation inAnnex IImean? Will a
regulation cited forelimination simply beeliminated without promulgation of
additional legislation?
8. Therepresentative ofMERCOSUR mentioned inhisopening statement totheWorking
Party thatsome non-tariff restrictions arebeing eliminated among themembers ofMERCOSUR.
Isthere anytimelimit forthecomplete phasing outofexisting non-tariff restrictions? Ifnot,
howcantheresidual restrictions bejustified interms oftheobligation ofacustoms union to
eliminate duties and"other restrictive regulations ofcommerce" withrespect tosubstantially all
thetrade between theconstituent territories oftheunion, assetforth inparagraph 8(a)(i) of
Article XXIV ofGATT 1994?
Another related question concerns anynon-tariff restrictions which maybeintroduced
following theimplementation ofthetrade liberalization programme, suchasBrazil 's1995import
quotaonautomotiveproducts.Aresuchrestrictionsequallyapplicabletomemberandnon-member
countries ofMERCOSUR, oraretheyapplicable tothemembers ofMERCOSUR onareciprocal
basis?
9. Please specify theexisting non-tariff restrictions currently applicable among themember
countries ofMERCOSUR.
10. Does MERCOSUR contemplate theretention ofanybarriers totrade after thephase out
period iscomplete?
11. What willresult from restrictions listed forharmonization?
(a) Isthere atimetable fordecisions bytheCommon Market Group, andarethere
consequences intrade terms ifthattimetable isnotadhered to?
(b) What istheprocess fordetermining howarestriction isharmonized? Atwhat
level willrestrictions beapplied? Themost restrictive, least restrictive? Will
harmonization ofanimport standard result inidentical import requirements for
allMERCOSUR Parties?
(c) How doMERCOSUR harmonization objectives comply withtherequirement of
theWorld Trade Organization Agreement ontheApplication ofSanitary and
Phytosanitary Measures, inparticular provisions requiring measures tobebased
onriskassessment, asappropriate tothecircumstance (Article 5.7), andthat
measures areadapted tothecharacteristics oftheareatowhich theproduct is
destined (Article 6.1)?
(d) Howdotheobjectives ofharmonizing sanitary andphytosanitary measures within
political borders coincide withtheinternational trend towards application ofsuch
measures based onregionalization?
(e) Doesharmonization ofanimport standard foragiven product imply thatproduct
willmove without restrictions among MERCOSUR Parties?WT/COMTD/1/Add.4
Page4
(f) What aretheobjectives ofMERCOSUR 'sharmonization efforts fornon-tariff
importrestrictionsfor:planthealth,animalhealth,foodsafety,technicalstandards
(including processed foods), andenvironmental protection. (Please address each
areaindividually).
(g) Specifically, what aretheexpected results regarding harmonization ofeachofthe
following restrictions listed inAnnex II:
(i) Technical standards, page 23,Uruguay, tobeharmonized, Measure 63:
pre-inspection forimportation offoodproducts;
(ii) technical standards, page 26,Argentina, tobeharmonized, Measure 70,
pre-inspection offresh, dried anddehydated fruit;
(iii) agriculturalpolicy,page41,Brazil,tobeharmonized,Measure116:wines:
prohibition onimports incontainers larger thanonelitre;
(iv) agricultural policy, page 49,Paraguay, tobeharmonized, Measure 172:
establish sanitary regulations forimported meat destined forinternal
consumption.
(h) Howarethird countries informed ofnewimport policies andprocedures developed
through theharmonization process?
(i) How willthird parties beassured thattheharmonization willnotcreate new
barriers tocurrent trade with MERCOSUR Parties? Specifically, will
harmonization result innewmarket access restrictions forthirdcountries exporting
toanyoftheindividual countries inMERCOSUR?
(j) What istherelationship between theplant quarantine activities inMERCOSUR
andtheplant health activities ofCOSAVE? Howarethese twoactivities linked?
Dotheyhave separate missions?
(k) What istheregional body foranimal health matters (i.e., thecounterpart of
COSAVE intheanimal health area)? Towhat extent haveharmonization efforts
been carried outintheareaofanimal health?
12. What non-tariff measures arestillinforce ontechnical standards, plant andanimal health,
environmentalprotectionandsafety?CouldthePartiesprovidemoredetailsonhowthesemeasures
willbeharmonized?
13. Could theParties provide specific information onthetypeandcoverage oftheresolutions
sofaradopted regarding theharmonization ofstandards?
14. Could theParties clarify themeaning of"asawhole" in"The duties covered byArticle VIII
oftheGeneral Agreement arefixed asawhole inaccordance withtheprovisions ofthatArticle
andtheobligations assumed bytheStates 'Parties toMERCOSUR intheUruguay Round", in
thereply toquestion 1.10ofWT/COMTD/1?
15. Could theParties mention every measure inforce ineachcountry adopted inthesituations
envisaged inArticle 50ofthe1980 Treaty ofMontevideo?WT/COMTD/1/Add.4
Page5
Thecurrent integration process isbased ontheprovisions intheTreaty ofAsunción onthe
elimination ofnon-tariff restrictions thatconstitute barriers totrade. Pursuant tothisobjective,
Decision 3/94oftheCouncil oftheCommon Market (CMC) andResolution 123/94 oftheCommon
Market Group (GMC) provide thatnon-tariff restrictions "shall beeliminated orconsidered for
harmonization within MERCOSUR" andgiveeffect toaprogramme forelimination orharmonization,
ofthemeasures identified, whichever isrelevant, tobemonitored bytherespective Technical Committee
(CT8 -Non-Tariff Restrictions andMeasures) oftheMERCOSUR Trade Commission (CCM). The
CCM approved anupdated listofmeasures covered bythisprogramme ofwork showing themeasures
already eliminated orharmonized.3Resolution 32/95 callsonthevarious Technical Committees,
Working Subgroups andAdHocGroups todealwiththeelimination orharmonization ofmeasures
identified within theirparticular fieldofcompetence.
Thelistofmeasures covered bythisprogramme isnotdirectly related totheconcept of"other
restrictiveregulationsofcommerce"referredtoinArticleXXIV.8(a)(i),eventhoughitcontainsmeasures
thatcome within thisconcept. Thechoice ofsuchmeasures isnotinconsistent withtherulesofGATT,
the1980Treaty ofMontevideo ortheTreaty ofAsunción. Thecurrent listcontains measures identified
bytheStates 'Parties toMERCOSUR asthecause ofrealorpotential problems fortheattainment
ofthedesired level ofeconomic integration, including, forexample, alarge number oftechnical
regulations andsanitary andphytosanitary measures. Inthiscontext, theprocess taking place goes
beyond theestablishment ofaCustoms Union andaimsattheestablishment ofaCommon Market,
asprovided forintheTreaty ofAsunción.
Themeasures deriving fromtheharmonization process inMERCOSUR arefullycompatible
withtheWTOAgreements.Inthecourseoftheprocess,allintra-MERCOSURtraderestrictionswithout
exception, within themeaning ofArticle XXIV.8(a)(i), willbeeliminated orarealready being eliminated
orharmonized.
II. THE COORDINATION OFMACROECONOMIC POLICIES
16. Please update theinformation provided inWT/COMTD/1 ontheplans MERCOSUR
members have intheareaofeconomic harmonization, whether infiscal, monetary, orfinancial
policy areas, andindicate what progress hasbeen made inthisarea.
17. Thetaxburdens imposed bythefourMERCOSUR members differ substantially. Brazil
inparticular hasacomplicated taxstructure withagreater variety ofindirect taxes onbusiness
operations thantheother countries. Theneteffect ofdiffering levels oftaxburden istopotentially
concentrate capital andeconomic activity inacountry withmore favourable taxtreatment. What
areMERCOSUR 'splans foraddressing suchtaxandfiscal issues?
18. Could theParties provide anupdated version ofalltheDecisions orResolutions adopted
bythehigh-level bodies ofMERCOSUR onthecoordination ofsectoral policies?
Ref: document WT/COMTD/1.
Therestructuring oftheGMC Working Subgroups (Resolution GMC 20/95) wasaccompanied
bytheadoption ofaseries ofguidelines andobjectives tobeachieved ineacharea. Theprocess was
finalized byapproval ofthedocument "MERCOSUR Action Programme untiltheyear2000", which
provides theoutline foramedium-term programme ofwork (Decision CMC 9/95).
3Acomputerized copy ofthelistwastransmitted totheSecretariat andisavailable tointerested Members
(Office 3006).WT/COMTD/1/Add.4
Page6
Thisdocument provides that,uptotheyear2000, MERCOSUR willwork towards thesolution
ofthecurrent economic andother problems. Thisstrategy stems from theideathatthematuring of
theintegration process willaccentuate theneedforgovernments toundertake ajointexamination of
certain economic policy measures. Furthermore, amore accurate picture ofthesituation ofmember
countries willmake itpossible toimprove theelaboration ofinternal policies.
III. THEESTABLISHMENTOFACOMMONEXTERNALTARIFFANDTHEADOPTION
OFACOMMON TRADE POLICY INRELATION TOTHIRD STATES ORGROUPS
OFSTATES
19. Anumber ofchanges intariff rates byindividual members ofMERCOSUR since
1January 1995 have created substantial uncertainty astowhat thecurrent rates are. Please
provide acomplete tariff schedule forbothintra-MERCOSUR andthird country trade.
20. Indocument WT/COMTD/1, thereply toquestion 3.6gives theinformation thatthe
common external tariff (CET) isconstructed as"aweighted average whose level willbelower
thanthetariffs applied bytheStates Parties prior tosignature oftheTreaty ofAsunción", while
thereply toquestion 3.7saysthat"therated average doesnotexceed thatapplied individually
bymember States prior tosignature oftheTreaty ofAsunción". Wewould liketoknow whether
thisprinciple hasalready been respected since 1January 1995 orisscheduled fornextyear?
Isthisruleapplicable foralltariff items (item-by-item) orfortheaverage rateofincidence?
21. Certain temporary exemptions were made totheMERCOSUR common external tariff
following themeeting oftheCommon Market Group heldinApril 1995. Could theParties confirm
thatthe20percentdutywhich wasoriginally foreseen forfootwear products willbereturned
toasfrom 1April 1996?
22. Weunderstand thatattheAsunción meeting inAugust 1995, themembers ofMERCOSUR
considered requests foranexpansion ofthelistofexempted products, or,ataminimum, the
right toadditems toreplace other items already onnational "exemptions lists" every 90days.
(a) Please describe theoutcome ofthisdecision.
(b) Does afinal listofexceptions nowexist?
(c) Doyouenvision additional changes tothelists?
(d) Please summarize theexceptions eachoftheMERCOSUR Parties isentitled to
andthelisteachhasadopted. Please alsoprovide thefull,final exceptions list
tothemembers ofthisWorking Party.
(e) What process willMERCOSUR usetoensure thatitsWTO partners arenotified
ofchanges thataremade totheCET andindividual country tariff schedules?
23. Please describe MERCOSUR 'splans withregard toacommon sugar regime.
24. Weunderstand some products were exempted from theapplication oftheCET asof
1January 1995. What isthespecified timeschedule forthegradual inclusion ofsuchexempted
products intoitsCET schedule?WT/COMTD/1/Add.4
Page7
25. Could theParties specify theproducts forwhich theconvergence period isexpected to
lastuntil 2006?
26. There isawide range ofexceptions totheCET andtheconvergence oftheexceptions
totheCET willinsome cases take11years. Inthisrespect, wethink thatthisCET isexceptional
andthatthorough examination isneeded tosecure thecompliance oftheCET oftheMERCOSUR
withArticle XXIV.8(a)(ii), which reads "substantially thesame duties".
(a) From thispoint ofview, cantheMERCOSUR members elaborate ontherationale
orcriteria forsetting down suchexceptions andthereason forthe11-year transition
period?
(b) Could theMERCOSUR provide uswithtrade dataonthose exceptions andalso
dataindicating their shares inthewhole trade?
27. MERCOSUR envisages fivecategories ofexceptions totheapplication ofaCET. Isthere
anestimate available ofthemagnitude ofMERCOSUR 'strade affected bythese exceptions?
Inother words, what amount oftotalimports from member countries would have beensubject
tosuchexceptions onthebasis ofimport statistics for,say,1994?
28. Inorder toestablish acustoms union, asstated inArticle XXIV.5 (a),"theduties and
other regulations ofcommerce... shallnotbehigher ormore restrictive thanthegeneral incidence
oftheduties andregulations ofcommerce applicable intheconstituent territories prior tothe
formation ofsuchunion...".
(a) CouldMERCOSURprovideacomparisonoftheoverallleveloftariffratesbetween
theCET andeachState Party 'sapplied rateonthebasis ofthetrade-weighted
average ofapplied rates?
(b) Could MERCOSUR explain thesituation concerning theestablishment ofcommon
regulations ofcommerce, andcould MERCOSUR confirm thatthecommon
regulations arenotmore restrictive than theprevious regulations ofeach State
Party?
29. Inthecasewhere theleveloftariffs oftheCET goesbeyond thatoftheUruguay Round
schedule ofeachmember country, thiswould constitute abreach oftheobligation provided in
Article IIoftheGATT. Insuchacase, inaccordance withArticle XXIV.6 ofGATT andthe
Understanding ontheInterpretation ofArticle XXIV ofGATT 1994, theprocedure setforth in
Article XXVIII must becommenced before tariff concessions aremodified orwithdrawn upon
theformation ofacustoms union. However, theCET wasenforced asof1January 1995without
respecting thisprocedure and,asaresult, theinterests ofathird country have been adversely
affected.
(a) Forthisreason, could theStates Parties totheMERCOSUR provide alistofthe
CET lineswhich exceed thelevelofthebound tariff rates oftheUruguay Round?
(b) CouldtheStatesPartiestotheMERCOSURalsosubmittherelevantdatanecessary
forArticle XXVIII negotiations:
(i) Statistics ofimports oftherelevant products involved, bycountry oforigin,
forthelastthree years (i.e.from 1992 to1994 andtheir average); andWT/COMTD/1/Add.4
Page8
(ii) anindication ofwhich countries areaffected byorder ofprincipal supplying
countries andcountries withasubstantial interest?
30. WhileitisenvisionedinArticleXXIVthatcountriesmaybreaktariffbindingsintheprocess
offorming acustoms union, there arespecific procedures thatmust befollowed tonotify the
breach ofabinding, tonegotiate compensation withaffected countries andtoreplace thetariff
schedules ofindividual countries withaschedule forthenewcustoms union. Itisouranalysis
thatoneMERCOSUR Party -Brazil -hasbroken anumber ofitstariff bindings intheprocess
ofadopting theMERCOSUR CET. WTO rules clearly specify thatnegotiations withaffected
countries aretobegin PRIOR tothebreach oftariff bindings. When doesBrazil intend tonotify
these modifications toitsbound tariffs properly, provide therequired trade andtariff dataand
begin compensation negotiations?
31. The MERCOSUR Parties currently maintain their WTO schedules asindividual
governments. AWTO tariff andservices schedule forMERCOSUR does notexist, butthe
individual schedules ofArgentina, Brazil, Paraguay andUruguay exist. What intentions dothe
Parties havetowithdraw theirindividual schedules andreplace them withaMERCOSUR schedule
intheWTO?
32. Inaccordance withArticle XXIV.5 andtheassociated Uruguay Round Understanding,
theWTO Secretariat ischarged withproducing anassessment ofthegeneral incidence ofthe
duties andother regulations ofcommerce before andafter theformation oftheMERCOSUR
customs union. Thisassessment istobemade onthebasis oftheweighted average applied tariff
rates. Thisinformation isvital fortheWorking Party 'sassessment oftheconsistency ofthe
MERCOSUR Agreement withArticle XXIV. Todate, theMERCOSUR countries havesupplied
onlypartoftheinformation requested andrequired forthisanalysis. When dotheMERCOSUR
Parties plantosupply thisinformation?
33. IntheUnited States, specific Congressional authorization isrequired toaltertariff levels.
DoanyorallofthefourMERCOSUR countries require legislative approval tomake changes
totheCET ortotherates charged onproducts currently excluded from theCET? Please provide
copies oftherelevant pieces ofnational legislation.
34. Please specify through which legal instruments MERCOSUR hasimplemented, orplans
toimplement, thezerointernal tariff andtheCET.
35. Could theParties explain thefeatures oftheinstitutional functioning ofMERCOSUR
which required theadaptation oftheprovisions oftheSafeguard Clause aslaiddown inArticle XIX
ofGATT? Could theParties provide acopy ofthislegislation?
36. What kind oftrade policy instruments dotheParties envisage adopting? What trade
measures have already been adopted? Under what criteria aretheyimplemented? Aretheyin
conformity withtheUruguay Round provisions? Ifso,please explain how.
CET:
Ref:documents WT/COMTD/1 (reply 3.6)andWT/COMTD/1/Corr.1 (replies 2.2and3.2).
TheCEThasapplied since 1January 1995, andacopyisavailable intheWTO Secretariat;
itwassubmitted totheWorking Party onMERCOSUR together withtheschedules ofexceptions for
thirdcountries andtheintra-MERCOSUR adaptation regime applicable. Thetrade dataondomestic
tariffs andtheimport trade ofthefourmember countries forthe1992/1994 triennium hasalsobeenWT/COMTD/1/Add.4
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submitted. MERCOSUR hasprovided theWTO Secretariat withallthedatanecessary toundertake
therelevant analyses inconformity withArticle XXIV.5 andtherelated Uruguay Round Understanding.
Thenational exceptions referred toinquestion 25were established byMERCOSUR in
Decision CMC 7/94witharising ordescending convergence withtheCET andtheyapply tothird
countries.
Decision CMC 7/94states thatgoods inthedataprocessing andtelecommunications sectors
willfollow alinear andautomatic convergence uptoamaximum common tariff of16percenton
1January 2006. InParaguay andUruguay, capital goods willfollow alinear andautomatic convergence
uptoarateof14percenton1January 2006whereas Brazil andArgentina willreach thesame figure
on1January 2001.
Asalready mentioned, MERCOSUR hasprovided theWTO Secretariat withallthestatistical
datanecessary tomeasure theeffects oftrade creation andtrade diversion (reference: document
WT/COMTD/1, Annex V),itdoesnotintend tomake anychanges intheschedules ofexceptions and
willnotify theWorking Group ofanyamendments totheCET. Legislative approval isnotrequired
tochange theCET inanyofthefourStates Parties.
With regard tothecommon regime forsugar, Decision CMC 19/94 provides foraperiod up
totheyear2001 fortheadaptation ofthesugar sector totheoperation ofthecustoms union.
Temporary exceptions: Since theGMC meeting heldinApril 1995, temporary exceptions have
beenmade totheCET, whose application willbefinalized inApril 1996. Therefore, thecorresponding
ratewillapply afterthatdate(CET ortheexception).
Common trade regulations
Ref.: document WT/COMTD/1 (reply 5.3)andWT/COMTD/1/Add.2 (section onstandards).
Thecommon traderulesthathavebeendrawn upinMERCOSUR todatecover aspects related
tothecommon tradepolicy andtheCET, forexample customs administration, non-tariff restrictions,
rules oforigin andtechnical regulations.
Common regulations onunfair tradepractices (dumping andsubsidies), safeguards, anti-trust
measures andconsumer protection arebeing drawn up.
Innone ofthecases, neither inthecommon regulations ineffect since 1January 1995 nor
intheregulations being drawn up,arethereanyprovisions orobligations thatcanbeconsidered more
restrictive thantheregulations previously applied byeachMERCOSUR StateParty. Theregulations
represent asteptowards thetotalliberalization oftrade among theStates Parties. Inaddition, the
regulations drawn uporbeing drafted thataffect tradewiththirdparties havebeendeveloped according
totheWTO Agreements andthecommitments bytheMERCOSUR States Parties asMembers ofWTO.
IV. RULES OFORIGIN
37. MERCOSUR 'srules oforigin appear toprovide forthefollowing:
- Thetariff heading oftheproduct inquestion must bedifferent from thatofthe
third country inputs usedduring production;WT/COMTD/1/Add.4
Page10
- ifthetariff change didnotoccur inproduction, orifthechange intariff heading
happened onlythrough "simple assembly" orother non-substantial means, then
theimported product isexamined toseeifitmeets a"reverse content" test(i.e.
thec.i.f. value ofimported inputs/parts cannot begreater than50percentfor
theproduct tobeeligible forthepreferential tariff rate).
General questions:
(a) Howdotherules oforigin forMERCOSUR products adhere toprinciples setout
inAnnex II,paragraph 3(a), oftheAgreement onRules ofOrigin inthe
GATT 1994, which require thatrules beclearly defined?
(b) IsMERCOSUR currently considering making anychanges totherules oforigin
agreed toatthetimetheTreaty ofAsunción wassigned? Ifso,what istheimpetus
forthose changes andwhat process willbeused forrenegotiating therules of
origin?
(c) Nocentralized authority regulates certificates oforigin todetermine which products
should enjoy theMERCOSUR preferential tariff rates. Currently, either
governmental bodies orprivate sector designates areauthorized toissuecertificates
forspecific sectors. Attachment IItotheAgreement contains rules andguidelines
governingthedecisionsoftheseorganizations,butwhatmechanismexiststoaddress
questions either about individual decisions orabout theconsistency ofpractices
among thedifferent groups?
38. MERCOSUR 'sopening statement totheWorking Party indicated thateligibility forintra-
regional trade willbegranted toproducts withaminimum regional content of60percentor
which undergo achange intariff heading within theregion. Thisstatement contradicts the50
percentregional content requirement stated inMERCOSUR 'soriginal response toquestions posed
bycontracting parties, ascontained indocument L/7540 of26October 1994. Hasthere been
anychange intheregulations andpolicies ofMERCOSUR members leading toanagreement
onahigher regional content requirement? Ifso,what wastherationale forintroducing astricter
requirement?
39. WillMERCOSUR adopt common non-preferential rules oforigin andinwhich sectors
willtheybeapplicable? Could acopy beprovided?
40. With respect torules oforigin, thework programme concerning harmonizing rules of
origin willbecompleted within three years ofinitiation ofthework asstipulated inArticle 9of
theAgreement onRules ofOrigin. Canitbetaken forgranted thattheresults ofthework
programme willbereflected intherules oforigin ofMERCOSUR? Until suchtime, what kind
ofrules oforigin willbeapplied?
41. Atthefirstmeeting oftheWorking Group, theParties informed thatthegoods originating
from freezones, processing zones, etc.willbesubject totheCET withsome exceptions. Could
theParties specify what these exceptions are?
42. What willbetheruleoforigin applicable togoods coming from thefreezones, processing
zones, etc.?
43. Please describe thetreatment afforded toproducts offree-trade zones inMERCOSUR.WT/COMTD/1/Add.4
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44. InArticles 3and4ofAnnex IItotheMERCOSUR Agreement, specific requirements
oforigin arementioned. Could MERCOSUR explain thedevelopments among member countries
onthispoint?
45. Articles 3and4ofAnnex IIindicate that States Parties toMERCOSUR may
establish/determine "more specific requirements oforigin".
(a) Arethese published rules?
(b) Aretheydeveloped byMERCOSUR countries asacomprehensive exercise orare
theytheresult ofadhocindividual cases which evolve intorules?
(c) Were these specific requirements notified toWTO?
46. Isacertificate oforigin requested fortheimportation ofallproducts from third countries
orjustforcertain products? What information, apart from thecountry oforigin, isrequired?
Could acopy beprovided?
47. Thesequence appears tobethatthecertificate/declaration oforigin hastobeissued by
aproducer orexporter, after which itis"certified" byanofficial department orauthorized
association. According toArticle 13,itisvalid for180days"from thedateoftheir issue".
(a) Does thismean thatthedateofcertification isnotrelevant tohowlongaperiod
itisvalid?
(b) Ifanassociation delays certification for179daysaftertheproducer issued it,would
thatmean thatthecertificate isonlygood foroneday, the180th after itwas
"issued" bytheproducer?
(c) Articles 11and12:isa"declaration" thesame thing asa"certification"?
(d) Article 13:doesthismean thatacertificate oforigin canbea"blanket" forall
imports ofsuchgoods for180days? Ordoesitmean thatthecertificate isgood
onlyforaparticular shipment for180days?
48. Rulings/appeals:
(a) How willimporters andexporters obtain binding advice orguidance intheform
ofrulings, asWTO Parties agreed toensure inAnnex IItotheWTO Agreement
onRules ofOrigin?
(b) Isadvice from animporter toonecountry "binding" onanother country? Ifnot,
isthere relief foranimporter whohasrelied ontheadvice from oneMERCOSUR
country astoorigin when, intheopinion ofanother MERCOSUR country, itwas
incorrect?
(c) What avenue isavailable toimporters andexporters toobtain anindependent
review ofanorigin determination (e.g. asituation under Article 16),asWTO
Parties agree toensure inAnnex IItotheWTO Agreement onRules ofOrigin?
Since 1January 1995, rulesoforigin forintra-MERCOSUR tradehaveonlyapplied tocertain
products inspecified circumstances. These areproducts which areexceptions totheCET, productsWT/COMTD/1/Add.4
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towhich theStates Parties apply trade policies thatarenotcommon andproducts whose inputs, parts,
spare parts orcomponents areexceptions totheCETandrepresent over40percentofthevalue of
thefinalgoods. These willcease toapply when there isconvergence between thetariff exceptions
andtheCET. Thissystem replaced thatineffect inthetransition period (1991-1994), which applied
ingeneral toallproducts benefiting from thetrade liberalization programme during thisperiod.
Therules oforigin during thetransition period (upto31December 1994), established inter
aliaregional value added, specifying acontent of50percent. Asfrom1January 1995, theregional
content hasbeensetat60percent.
TheMERCOSUR Customs Code, currently being considered bytheParliaments, prescribes
incertain cases theapplication ofnon-preferential general rulesoforigin fortrade withthirdparties.
None oftheStates Parties apply suchrules tothetextiles orsports footwear sectors.
MERCOSURrequirescertificatesoforiginunderpreferentialtariffagreementsconcludedwithin
thescope ofLAIA andtheGSTP.
Unless otherwise indicated inthepreceding paragraphs, certificates oforigin arenotrequired
fortheimport ofproducts from thirdcountries.
Goods fromfreezones orexport processing zones areconsidered tobefromoutside thearea
andassucharesubject topayment oftheCET. AcopyofMERCOSUR Council Decision 8/94is
attached.
Inreply toquestion 37(a), itisconsidered thatrulesoforigin applicable tointra-MERCOSUR
trade arecompatible withtheAgreement onRules ofOrigin ofGATT 1994 andareclearly defined.
Each State Party hasaninstitution responsible forissuing certificates andapplying therules
oforigin. Thisinstitution isempowered todelegate theissue ofcertificates oforigin toother public
bodies orhigh-level entities acting atthenational, stateorprovincial levels. Anofficial department
isresponsible formonitoring theissue ofcertificates oforigin.
TheCommon Market Group, theTrade Commission anditsTechnical Committee 3-Trade
Rules andDisciplines -areMERCOSUR bodies withthecompetence andcapacity toadopt anydecisions
onthisaspect.
Thespecific requirements onorigin arepublished bytheofficial bodies ineachState Party,
transmitted totheinstitutions responsible forissuing certificates andtothecustoms authorities which
require thesupporting documentation. Currently, these onlyapply tothechemicals, ironandsteel,
capital goods, dataprocessing, consumer electronics andtelecommunications sectors.
Thespecific requirements areagreed jointly bytheStates Parties toMERCOSUR. Theyapply
tointra-MERCOSUR trade inthecases andunder thecircumstances mentioned above. They will
continue toapply untiltheconvergence ofdomestic tariffs andtheCET. Ingeneral, therequirements
relate tomanufacturing based onregional inputs, technological requirements, production processes
thatinvolve alarge degree ofprocessing orregional value added complementing thechange inthe
tariff.
Thecertificate oforigin isissued bytheauthorized body, which certifies thedeclaration of
thefinalproducer orexporter. Itisvalid for180daysandforaspecified shipment.WT/COMTD/1/Add.4
Page13
Because MERCOSUR isanintergovernmental body, questions andcomplaints byindividuals
mustbeaddressed tothejointbodies through national organizations. ThefourStates Parties alsohave
positive lawprovisions foraction under administrative law,which provide asatisfactory guarantee
ofcompliance withthelegalprovisions.
Oneofthefunctions oftheMERCOSUR Trade Commission istotakedecisions onthe
administration andapplication oftrade policy instruments agreed upon bytheStates Parties. Italso
considers claims made byindividuals submitted totheirrespective national sections andeither settles
them directly ortransmits them totheCommon Market Group foradecision.
V. MEASURES RELATED TOIMPORTS FROM THIRD COUNTRIES
49. Could theParties explain thesituation asregards regulations concerning unfair trade
practices? What istheir specific coverage? Hasanypiece oflegislation been adopted? Ifso,
please provide copies. Ifnot,when arethese expected?
50. Could theParties explain indetail thecommon setofrulesgoverning unfair trade practices
theyareworking on?
51. Canitbeunderstood thatifaState Party invokes safeguard measures, thesafeguard will
beinvoked without excluding trade withother States Parties?
52. Isitcorrect tounderstand thatonecommon safeguard willbeapplied byMERCOSUR?
Ifthisisthecase, could acopyofthelegalinstrument andmore information onhowthesafeguard
instrument willfunction, forinstance which authority willapply theinstrument, howwillthe
injury bedetermined, etc.beprovided? Willasingle MERCOSUR instrument alsobecreated
foranti-dumping andanti-subsidies proceedings? Could theParties provide acopyofthecommon
regulations onsafeguards inrelation tothird countries?
53. Anti-dumping andcountervailing duties:
(a) Could theStates Parties toMERCOSUR provide asynopsis ofthethree documents
(mentioned intheresponse toquestion 5.3ofdocument WT/COMTD/1) approved
pursuant toArticle 4oftheMERCOSUR Agreement? What sortofconsultations
andexchanges ofinformation onunfair trade practices areenvisioned among the
Member States ?
(b) Thepurpose ofanti-dumping andcountervailing dutymeasures isnottoprevent
orevenrestrict imports butrather tooffset themargin ofunfair trade ortheinjury
caused byit.TheParties havestated thatcommon regulations havebeenapproved
byMERCOSUR torestrict imports which arethesubject ofdumping orsubsidies
bynon-Member countries, yettheParties havealsostated thattheywillonlyapply
domestic legislation torestrict imports resulting from unfair trade practices.
(i) IsittheParties 'intent toharmonize theadministration oftheir domestic
legislation inthecontext ofMERCOSUR ortoadminister acommon law?
Ifthelatter isthecase, when dotheParties foresee theadoption ofa
common law?
(ii) Inthefuture, dotheParties envision aunified approach toregulating unfair
trade from non-Member nations, perhaps administered byacentral
institution? Ifso,what might bethecentral institution?WT/COMTD/1/Add.4
Page14
(iii) Willdumped orsubsidized imports from other MERCOSUR countries be
treated anydifferently from suchimports from non-Member countries?
Within thecontext ofcreating acommon market, isittheParties 'intent
toabolish unfair trade regulations between Member States?
54. Please make available therelevant anti-dumping andcountervailing duties legislation.
Please explain alsohowananti-dumping proceeding which iscarrying outtheanti-dumping or
countervailingdutyinvestigationandtheinjuryinvestigationwouldwork?Willaproductimported
intooneMERCOSUR country besubject toananti-dumping orcountervailing duty covering
thetotal territory oftheMERCOSUR countries? Willfuture measures beequally applicable
toimports inevery MERCOSUR country? Inwhat respect isthesituation different during and
after thetransition period? Does thisalsoimply thatexisting national anti-dumping and
countervailing dutylegislation willdisappear? Ifso,bywhatdate? What willhappen withnational
anti-dumping andcountervailing measures thatareinforce?
55. Canitbeunderstood that, ifaState Party invokes anti-dumping orcountervailing duty
measures, these willbeinvoked without excluding trade withother States Parties? Ifthisisnot
thecase, canMERCOSUR explain thelegal grounds forthis?
56. Canitbeunderstood thatifaState Party invokes balance-of-payments measures, these
willbeinvoked without excluding trade withother States Parties? Ifthisisnotthecase, can
MERCOSUR explain thelegal grounds forthis?
Safeguards
TheStates Parties toMERCOSUR haveratified theUruguay Round Agreement onSafeguards.
Common safeguards regulations forMERCOSUR arebeing drafted; theywillbefullyconsistent with
theWTO provisions andwillallow MERCOSUR safeguard measures tobeapplied totherestofthe
world.
Anti-dumping andcountervailing duties
TheStates Parties toMERCOSUR haveratified theAgreement onApplication ofArticle VI
andtheAgreement onSubsidies andCountervailing Measures oftheUruguay Round. Common
regulations onunfair trade practices (dumping andsubsidies) arealsobeing drawn up;theywillbe
fullyconsistent withtheWTO provisions andwillallow MERCOSUR anti-dumping andcountervailing
duties tobeapplied toother countries.
Balance ofpayments
IfaState Party decides toapply measures based onArticle XVIII.B ofGATT 1994 andthe
relevant Uruguay Round Understanding, theStates Parties toMERCOSUR willfollow therelevant
WTO provisions.
VI. NATIONAL TREATMENT
57. Please confirm thatArticle 7hasnodetrimental effect ontherights ofWTO Members.WT/COMTD/1/Add.4
Page15
VII. MERCOSUR 'SEXTERNAL RELATIONS4
58. Please confirm thatArticle 8doesnotimpair therights ofWTO Members.
59. Please describe MERCOSUR 'splans regarding theaccession ofnewcountries tothe
Agreement, aswellasMERCOSUR plans forother types ofassociation withother countries,
short ofaccession.
Commitments under LAIA
Thepurpose ofthenegotiations between MERCOSUR andother member countries ofLAIA,
including those referred toinArticle 25ofthe1980 Treaty ofMontevideo, istoreplace thebilateral
agreements inforce prior totheformation oftheCustoms Union bynewagreements between
MERCOSUR andeachcountry. Theprogress made andtheconclusion ofthese newAgreements are
currently atdifferent stages.
Resolution GMC/1994 wasadopted in1995authorizing theMERCOSUR-LAIA adhocgroup
topursue negotiations ontheextension andrenegotiation ofthebilateral agreements withother LAIA
countries aswellasthose referred toinArticle 25ofthe1980 Treaty ofMontevideo.
Because itwasnotpossible toconclude thenegotiations toallow these Agreements toenter
intoeffect on1January 1996, itwasdecided toextend thebilateral agreements previously inforce
until31December 1996. Negotiations arecurrently going onwithChile ontheestablishment ofa
free-trade area.
Anagreement between MERCOSUR andBolivia fixing tariffpreferences hasbeensigned and
entered intoforce on1January 1996.
European Union
InDecember 1995, MERCOSUR signed withtheEuropean Union aFramework Agreement
onInterregional Cooperation laying down thebases forthegradual reciprocal liberalization oftrade
between thetworegions inthemedium term.
TheCooperation Agreement underlined bothParties 'political determination toestablish as
anultimate objective aninterregional association andgradual reciprocal liberalization ofalltrade, taking
intoaccount thesensitivity ofcertain products andinaccordance withWTO rules. Inaddition, both
Parties initiated regular political dialogue tocomplement andreinforce therapprochement between
theEuropean Union andMERCOSUR.
FreeTrade Area fortheAmericas
Thedecision toconclude thenegotiations onaFreeTrade AreafortheAmericas (FTAA) at
thelatest bytheyear2005wasadopted bythePresidents andHeads ofStateoftheAmericas atameeting
heldinMiami, United States ofAmerica, inDecember 1994.
Seven working groups weresetupfromJune1995onwards inorder tomake progress inareas
suchasmarket access, customs formalities andrulesoforigin, technical barriers, investment, sanitary
4Includes questions under sections 7(Commitments under LAIA), 8(Accession) and12(MERCOSUR and
integration efforts inthewestern hemisphere) indocument WT/COMTD/1.WT/COMTD/1/Add.4
Page16
andphytosanitary measures, dumping andsubsidies, andsmall-scale economies. These groups compiled
areport andrecommendations forthemeeting ofAmerican Ministers forTrade, which washeldin
Cartagena inMarch 1996. Themeeting decided tosetupnewworking groups ongovernment
procurement, services, intellectual property rights, andcompetition policy.
TheStatesPartiestoMERCOSURhaveparticipatedinalltheseworkinggroupsandcoordinated
theirposition. MERCOSUR hasalsoadopted aposition ontheprocedure outlined forthecreation
oftheFTAA andthemeans ofachieving thisobjective.
MERCOSUR-United States Framework Agreement onTrade andInvestment
InJune1991, aFramework Agreement between theStates Parties toMERCOSUR andthe
United States ("Rose Garden Agreement") onthepromotion oftradeandinvestment wassigned. Several
meetings havebeenheldunder thisAgreement.
MERCOSUR-ANZCERTA ("Australia -NewZealand Closer Economic Relations Trade Agreement")
talks
MERCOSUR isseeking arapprochement withAustralia andNewZealand, which belong to
ANZCERTA. Afurther meeting isenvisaged toconsider waysofstrengthening economic linksbetween
thetworegions.
VII. SETTLEMENT OFDISPUTES5
60. PleaseprovideacompletedescriptionoftheMERCOSURdisputesettlementsystem.Please
explain therelationship oftheBrasilia Protocol tothedispute settlement system.
61. Isinternational arbitration anintegral partofthedispute settlement process?
62. IsMERCOSUR giving anyconsideration tothecreation ofapanel process, similar to
thatusedintheWTO?
TheMERCOSUR dispute settlement system issetoutintheBrasilia Protocol (seeSections 9.1
and9.2ofdocument WTO/COMTD/1), which complements theProtocol ofOuro Preto andhasbeen
dulytransmitted totheWTO Secretariat. Thearbitration provided forintheBrasilia Protocol does
notenvisage thecreation ofapanel process.
XI. TRADE CREATION/TRADE DIVERSION6
63. Now thatMERCOSUR hasbeen inoperation fornearly ayear, cantheStates Parties
please provide preliminary dataonthetrade creation andtrade diversion effects ofMERCOSUR?
5Section nineofdocument WT/COMTD/1.
6Section 11indocument WT/COMTD/1.WT/COMTD/1/Add.4
Page17
X. SERVICES7
64. InArticle IoftheTreaty establishing MERCOSUR, theParties state thattheir goalis
the"free movement ofgoods, services andfactors ofproduction...". However, theAgreement
doesnotaddress liberalization inservices trade.
(a) HowdotheMERCOSUR States Parties plantoaddress thequestion offreetrade
inservices?
(b) Willcoverage beuniversal; ifnot,which sectors willbeexcepted?
(c) Willthesame rules apply whether services providers areestablished orcross-
border? Ifnot,please listthedifferences.
(d) Will this liberalization provide fortheelimination ofsubstantially all
discrimination?
(e) What istheplanned timetable forliberalization inservices?
(f) CanMERCOSUR member States indicate whether suchliberalization willraise
theoverall level ofbarriers forcontracting Parties notmembers ofthe
MERCOSUR Agreement?
(g) DotheMERCOSUR countries provide national treatment insome orallservices
sectors toservices providers ofother MERCOSUR countries? Ifso,what isthe
provision ordecision bywhich thistreatment isoffered? Issuchnational treatment
extended toservice providers from third countries?
(h) DotheMERCOSUR States Parties have anyplans toharmonize professional
standards, forexample, intheaccounting, legal, engineering andmedical fields?
Theprogramme ofwork approved byDecision 20/95 oftheGMC setupanadhocservices
group.
Thisgroup 'sagenda includes thepreparation ofadraftframework agreement onservices, which
willbebased ontheWTO General Agreement onTrade inServices (GATS).
XI. OTHER AREAS8
65. Articles 38and42oftheProtocol ofOuro Preto indicate thatallMERCOSUR decisions
andfindings arebinding onallfourParties totheAgreement.
(a) Isthiscorrect? Ifso,howisthisprovision enforced?
(b) Please provide anupdate onthe11working groups thathave been established
byMERCOSUR. What progress hasbeen made ineachofthegroups?
7Section 13indocument WT/COMTD/1.
8Section 14indocument WT/COMTD/1.WT/COMTD/1/Add.4
Page18
66. Since Argentina hasexempted MERCOSUR members from thestatistical taxonimports,
wewould appreciate anexplanation ofthenewcostcalculations forassessing thistaxon
non-MERCOSUR imports.
67. Could theParties provide acomplete listing oftheexport duties (ormeasures having
equivalent effect) presently inforce onrawhides andskins on"wet-blue products andonfinished
leather? Isthere aproposal fortheelimination ofthese charges andifsocould theParties provide
details?
68. Weunderstand thatMERCOSUR hasdesignated specific points ofentry intoeachcountry
tofacilitate themovement ofgoods, particularly agricultural products. Could youexplain how
thisdesignated portsystem operates? Isitopentoimports from third countries? What approval
documents areusedinthissystem, ifany,andcanyouprovide acopyofthatapproval document?
69. Please describe MERCOSUR 'splans withregard tocreation ofacommon automotive
regime?
70. Several MERCOSUR countries haveinstituted orareconsidering instituting trade-related
investment measures, primarily intheautomotive area. Argentina 'sinvestment regime requires
aspecified amount oflocal content, Uruguay provides animport duty preference onfinished
vehicles tolocal carassemblers andspare parts producers thatexport their ownproducts. The
effect ofsuch distortionary measures wasemphasized bytherecent appeal ofBrazil tothe
Committee onBalance-of-Payments Restrictions tojustify newTRIMs inresponse toexisting
MERCOSUR TRIMs.
(a) Since allinconsistent TRIMs properly notified totheTRIMs Committee by
developing countries must beeliminated within fiveyears, isMERCOSUR
considering theearlier removal ofTRIMs toeliminate theproblems caused by
suchdistortionary measures?
(b) Inaddition totheautomotive sector, dotheMERCOSUR Parties have other
inconsistent measures notified totheTRIMs Committee under thetransitional
arrangements? What aretheir intentions withrespect totheelimination ofsuch
measures?
71. Concerning therecently adopted MERCOSUR Agreement onpromotion andprotection
ofinvestment, howarebilateral agreements previously signed byaMERCOSUR member with
athird country affected?
72. WhatkindofcompetencedoesMERCOSURassuchhaveintheareaofintellectualproperty
rights?
73. Which precise action hasbeentaken inthisareauptodate(please provide copies ofany
relevant documents suchasproposals forregional treatment ofintellectual property rights.)
Questions applicable toboththeTrade Mark andCopyright Agreements
74. What isthestatus ofthisAgreement?
(a) Have itsform andcontent been finalized?
(b) Which MERCOSUR countries have accepted ittodate?WT/COMTD/1/Add.4
Page19
(c) Ifithasnotyetbeen signed byMember States, what istheschedule fordoing
so?
75. Once ithasbeensigned byMember States, what status willithaveintheirdomestic legal
systems?
(a) Willithave toberatified bytheir legislatures?
(b) Willadditional legislation berequired tobring itintoforce onanational level?
Ifso,what isthelikely schedule, form andcontent ofthatlegislation?
(c) Willthissystem have retroactive effect?
76. Why hasanAgreement ofthistypebeen pursued?
(a) What perceived deficiencies inthelegal regimes oftheMember States arebeing
addressed bythisAgreement?
(b) What perceived inconsistencies inthelegalregimes oftheMember States arebeing
addressed bythisAgreement?
77. What treatment willforeign nationals begranted under thisregime?
(a) Willnational treatment ormost-favoured-nation treatment beprovided?
(b) Ifnot,what must foreign nationals dotogetthistypeofprotection?
78. Willanyadministrative mechanism beestablished tocarry outthese Agreements andany
other future arrangements contemplated bythem?
79. When must theprovisions ofthese Agreements befulfilled?
Questions concerning theTrade Mark Agreement
80. Why doesArticle 6notspecifically provide thatpersonal names, numbers andletters are
within thescope oftrade mark subject matter, asrequired byArticle 15.1oftheTRIPS Agreement?
81. Onwhat grounds willanapplication foratrade mark bedenied ifit"affects therights
ofthird parties", assetforth inArticle 9.3? Would thispreclude theregistration ofamark in
oneMERCOSUR country ifsomeone hadmade some minor amount ofuseofthemark inanother
MERCOSUR country? What ifthemark waswellknown andtheprior usewasinbadfaith?
Inanyevent, what purpose isthisprovision intended topromote?
82. Why doesArticle 9.4provide thatanapplication willbedenied ifthemark islikely to
cause confusion withanexisting mark andrequire thattheapplicant must know orought toknow
thathismark issimilar totheexisting mark? Should itnotbeenough thatthere isalikelihood
ofconfusion todeny registration? Additionally, whydoesthisprovision onlyrelate tomarks
belonging toowners thatare"established orliving inanyofthesignatory States"? Isthisnot
aclear violation ofnational treatment asrequired byArticle 3oftheTRIPS Agreement?WT/COMTD/1/Add.4
Page20
83. What "market" isreferred toinArticle 13?Doesthismean thataslongasthegoodbearing
thetrade mark isproduced inthe"market", however defined, itcanbeimported inparallel into
aMERCOSUR country?
84. Bywhat timeareallMERCOSUR countries expected toadhere totheNiceAgreement,
pursuant toArticle 18?
85. What typeofplant-related protection iscontemplated under Article 21,andwhat isthe
deadline fortheestablishment ofsuchprotection?
86. What typeof"effective measures" arecontemplated under Article 22,andwhat isthe
deadline fortheestablishment ofsuchmeasures?
87. What other Agreements arecontemplated under Articles 23and24?When would such
arrangements oragreements bedeveloped/concluded?
Questions concerning theCopyright Agreement
88. Under what grounds willfullnational treatment andmost-favoured-nation treatment be
granted tonationals ofnon-MERCOSUR countries? Doestheanswer tothisquestion differ based
onthetypeofprotection atissue(i.e.TRIPS-level protection versus TRIPS-plus-level protection)?
How doesthisrelate tothenational treatment andmost-favoured-nation treatment required by
Articles 3and4oftheTRIPS Agreement?
89. What level ofproof willregistrations from non-MERCOSUR countries begranted, in
lightofArticle 6?
90. What istheintended purpose ofArticle 7?Would thispermit under anycircumstances
thegrant ofcompulsory licences? Ifso,would thatnotconflict with Article 13ofthe
TRIPS Agreement?
91. Does Article 8permit theparallel importation ofworks from oneMERCOSUR country
toanother? What treatment willlegitimate works created outside MERCOSUR begranted?
What istherelationship ofthisprovision withArticle 18?What iscovered bytheconcept of
"commercializing"? Forexample, canpeople show videos topaying customers iftheylegitimately
purchase thevideos?
92. What isthemeaning ofthelastprovision inArticle 13?How willcollaborators beable
to"dispose freely" ofthepartoftheaudiovisual work thatconstitutes theirpersonal collaboration?
Does thissupersede contractual obligations withtheproducer oremployers?
93. How willMERCOSUR countries beabletoassure employers thatworks produced by
their employees canbeused inthenormal course ofcommerce, which intheareaofsoftware
involves theregular modification ofworks created byemployees, usually without their consent?
Would establishing inalienable andunwaivable model rights perArticle 14notruncounter to
thisgoal?
94. Does Article 16notinherently conflict withthelanguage ofArticle 14?What variations
could beplaced ontotalinalienability andwaivability?
95. Will placing acopy ofawork onthemarket exhaust therental right established in
Article 17(e)?WT/COMTD/1/Add.4
Page21
96. Under what circumstances would aperson bepermitted tomake personal-use copies of
works perArticle 19.TheUnited States believes thatpersonal useexceptions inherently conflict
withthenormal exploitation ofcopyright andcause unjustified harm tothelegitimate interests
oftheright holder, intheabsence ofsignificant clarification ofwhat actsareatissue.
97. How willtheequitable remuneration established byArticle 21becollected? Willitbe
granted tonationals ofnon-MERCOSUR countries onanational treatment basis? Ifnot,what
criteria willbeapplied?
98. InArticle 22,what does"maintaining essential features" mean?
99. What istheterm ofprotection forcomputer programs? Forworks created inthecourse
ofanemployment relationship?
100. Willneighbouring andrelated rights begranted tonationals ofnon-MERCOSUR countries
onthebasis ofnational treatment, including rights toequitable remuneration?
101. Willcollecting societies beoptional? Willright holders beabletochoose thesociety they
want tojoin?
102. What measures arecontemplated byArticle 43andwhen must theybeimplemented?
103. What other measures arecontemplated byArticle 44?
With regard tothequestions referring toArticles 38and42oftheProtocol ofOuro Preto,
alltheregulations approved byMERCOSUR 'sdecision-making bodies aremandatory andmust be
integrated intothedomestic legalsystems ofStates Parties.
Statistical tax
Argentina bound the3percentstatistical taxintheofferrelating to"other duties andcharges".
Export dutyonleather
Argentina, Brazil andUruguay have export duties onleather. This issue isstillunder
consideration inthecompetent bodies ofMERCOSUR.
Portselection system
There isnoportselection system inthesense ofdirecting trade. Resolution GMC 8/94specifies
theborder points thatarethemost important operationally, where there isanintegrated control
mechanism.
Automotive regime
Decision CMC 29/94 establishes acommon regime compatible withWTO rules asfrom
1January 2000.
Investment
Ref: document WT/COMTD/1/Add.2; Replies toquestions andcomments relating to
investment.WT/COMTD/1/Add.4
Page22
Thereply toquestions 1to3inthisdocument states:
"MERCOSUR reached twoagreements onpromotion andreciprocal protection ofinvestments,
onegoverning investments fromwithin theregion andtheother forinvestments fromoutside
theregion. Theagreements reached byMERCOSUR inthisareaalready provide foradispute
settlement procedure thatdoesnotinclude anyrolefortheCommon Market Group. The
Protocol, which governs investments from outside theregion, provides forrecourse to
international arbitration fordisputes arising between aninvestor andaState Party."
Regarding investment policy, MERCOSUR Member States havetheirowninstruments which
remain ineffect andthere havebeennochanges inthisareatodate.
Intellectual property rights
TheStates Parties toMERCOSUR haveratified theAgreement onTrade-Related Aspects of
Intellectual Property Rights, which isoneoftheresults oftheUruguay Round.
Ascanbeseenfrom Decision CMC 8/95, MERCOSUR hasadopted anAgreement on
Trade Marks, Indications ofSource andAppellations ofOrigin.
XII. TRANSPARENCY INIMPLEMENTING THE AGREEMENT9
104. AreMERCOSUR rules andlegal documents available from asingle source suchasthe
MERCOSUR Secretariat inMontevideo, Uruguay? DoMERCOSUR decisions generally require
authorization bytherespective legislatures ofthefourcountries? What types ofdecision can
beimplemented without legislative approval? What mechanisms exist toenforce thefull
implementation ofMERCOSUR decisions?
105. What central institutions existtohandle theday-to-day operations ofMERCOSUR, for
example, theissuance ofcertificates oforigin?
106. Aswasagreed inparagraph 11oftheUnderstanding ontheInterpretation ofArticle XXIV
oftheGATT 1994, customs unions andconstituents offree-trade areas shall report periodically
ontheoperation oftherelevant agreement. How does theMERCOSUR comply with this
agreement?
Ref: document WT/COMTD/1.
MERCOSUR 'sAdministrative Secretariat canprovide allMERCOSUR 'srules andlegal
documents. TheStates Parties incorporate these intheirrespective domestic legislation, asprovided
forintheProtocol ofOuro Preto.10
9Section 15indocument WT/COMTD/1.
10Updated documents concerning thedecisions adopted byMERCOSUR 'sdecision-making bodies havebeen
transmitted totheSecretariat.WT/COMTD/1/Add.4
Page23
ANNEX
ListofDocumentation Transmitted totheSecretariat
1. Documents citedinthereplies:
- Updated listofmeasures under theprogramme ofwork forharmonization (only in
computerized form);
- Resolution GMC 32/95;
- Decision CMC 8/94;
- Resolution GMC 8/94;
- Decision CMC 8/95.
2. Resolutions andDecisions adopted byMERCOSUR 'sdecision-making bodies sinceDecember
1994 todate, andannexes:
- Resolutions GMC 35-42/95 and1-19/96;
- Decision CMC 9/95.