RESTRICTED
WORLD TRADE G/SG/W/181
4October 1996
ORGANIZATION(96-4028)
Committee onSafeguards
NOTE FROM THE SECRETARIAT
Thefollowing draftannual report iscirculated forconsideration byMembers, inaccordance
withtheCommittee 'sdecision atitsMaymeeting.
Textwhich appears inthedraftinredline indicates portions ofthedraftwhere changes are
anticipated bytheSecretariat before thereport isapproved bytheCommittee atitsOctober meeting.
DRAFT REPORT (1996) OFTHE COMMITTEE ON
SAFEGUARDS
I. Organization ofthework oftheCommittee
1. TheAgreement onSafeguards entered intoforce on1January 1995. Pursuant to
Article 13.1oftheAgreement, membership intheCommittee onSafeguards isopentotheparticipation
ofanyMember indicating itswishtoserve onit.Pursuant toadecision oftheCouncil forTrade in
Goods atits20February 1995meeting, allWTO Members would beMembers oftheCommittee on
Safeguards, except forthosethathadexplicitly indicated theirwishtothecontrary by22February 1995.
NoMember indicated suchawish, andaccordingly, atitsmeeting of24February, theCommittee
tooknotethat,byvirtue oftheCouncil forTrade inGood'sdecision, allMembers oftheWTO are
Members oftheCommittee.
2. Observer governments intheGeneral Council oftheWTO have Observer status inthe
Committee. Inaddition, atitsspecial meeting of13-14 July1995, theCommittee invited, onanad
hocbasis, representatives oftheWorld Bank, OECD, andIMFtoattend meetings oftheCommittee
inanobserver capacity. Atitsregular meeting on25October 1996, theCommittee tooknoteofthe
decision oftheGeneral Council regarding thestatus ofinternational organizations asObservers tothe
WTO and....
3. Thefocus ofthisreport isontheperiod since theCommittee 'slastannual report (G/L/32),
thatis,November 1995-October 1996. However, where relevant, information fromtheprevious period
isreported. During theperiod under review theCommittee heldthreemeetings. Theregular meeting
oftheCommittee washeldon25October 1996(G/SG/M/7). Special meetings oftheCommittee were
held11-12December1995and6May1996(G/SG/M/5+Suppls.1and2,andG/SG/M/6,respectively).
4. Mr.Jorge A.Ruiz(Argentina) wasappointed Chairman oftheCommittee for1995-1996.
Atitsmeeting of24February 1995, theCommittee decided toelectitsownofficers, Chairman and
Vice-Chairman. TheCommittee atitsspecial meeting of13-14 July1995elected Mr.Andràs Lakatos
(Hungary) asVice-Chairman for1995-1996. Atitsspecial meeting of6May1996, theCommittee
elected Mr.J.Antonio S.Buencamino (Philippines) asChairman, andMs.Laurence Wiedmer
(Switzerland) asVice-Chairman, for1996-1997. Pursuant totheCommittee 'srules ofprocedure,
Mr.Buencamino andMs.Wiedmer tookoffice attheendofthatmeeting.G/SG/W/181
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5. Atitsspecial meeting of6May1996, theCommittee agreed toaddasecond regular (Spring)
meeting toitsannual meeting schedule. Thismeeting willbescheduled inconjunction withtheSpring
meetings oftheCommittees onAnti-Dumping Practices andSubsidies andCountervailing Measures.
6. Atitsspecial meeting of6May1996, theCommittee adopted Rules ofProcedure forMeetings
oftheCommittee onSafeguards (G/SG/4), based ontheRules oftheGeneral Council andoftheCouncil
forTrade inGoods, andincorporating relevant changes tomake them applicable totheCommittee.
TheCouncil forTrade inGoods subsequently approved theCommittee 'sRules ofProcedure atits
meeting of22May1996.
II. Notification andexamination ofsafeguards lawsand/or regulations ofMembers
7. Intheareaofsafeguards, WTO rulesareimplemented through Member 'snational legislation.
Pursuant toArticle 12.6oftheAgreement, asamplified byadecision oftheCommittee, Members
withavailable legislation and/or regulations regarding safeguards investigations orreviews covered
bytheAgreement should notify thefullandintegrated textoftherelevant legislation and/or regulations
totheCommittee. Ifsuchlegislation and/or regulations donotexistorarenotavailable, theMember
should inform theCommittee ofthisfact,andexplain thereasons therefore. These notifications have
beentreated asunrestricted documents fromtheoutset. Inaddition, theCommittee decided atitsspecial
meeting of24February 1995 thatObserver governments should provide theCommittee withany
informationtheObservergovernmentsconsiderrelevanttomatterswithinthepurviewoftheAgreement,
including thetextoftheirlawsandregulations regarding safeguard actions, andinformation regarding
anysafeguard measures taken bytheObserver governments.
8. Asof24September1996,64Members1hadnotifiedtheCommitteeoftheirdomesticsafeguards
legislation ormade communications inthisrespect totheCommittee (G/SG/N/1 andaddenda). Forty-
fourMembers hadnot,asofthatdate,made notifications under Article 12.6oftheAgreement, although
thedeadline forsuchnotifications was15March 1995. TheAnnex liststhestatus ofnotifications
under Article 12.6oftheAgreement. Theissueoftheextent ofthenon-compliance withthisnotification
obligation, andtheimplications ofthissituation, werediscussed atmeetings oftheCommittee during
thereview period (G/SG/M/6, paras. 29-30; andG/SG/M/7).
9. Ofthe64Members submitting notifications, 35notified thattheyhadnospecific legislation
relating tosafeguards, 9notified newlegislation, and20notified pre-WTO legislation stillinforce.
Ofthe55Members notifying either nosafeguards legislation orpre-WTO legislation stillinforce,
19indicated thatnewlegislation isbeing considered ordrafted. Inaddition, 13Members indicated
thattheWTO Agreement hasforce oflawintheterritory oftheMember.
10. Duringtheperiodunderreview,theCommitteecontinuedtheworkofreviewingthenotifications
ofneworamended safeguards legislation notpreviously reviewed. During thereview period, the
following Members 'notifications ofsafeguards legislation werereviewed: Argentina, Brazil, Cuba,
Ecuador, ElSalvador, Hungary, Israel, Japan, Macau, Mexico, Norway, St.Lucia, South Africa, and
Turkey.
11. TheCommitteealsoreviewedthenotificationswithoutlegislativetextofthefollowingMembers:
Australia, Bolivia, Côted'Ivoire, Dominican Republic, ElSalvador, Guatemala, Guinea (Rep. of),
Honduras,Iceland,India,Kenya,Malaysia,Maldives,Malta,Mauritius,Morocco,Myanmar,Nicaragua,
Nigeria, Pakistan, Paraguay, Philippines, Poland, Slovak Republic, Slovenia, SriLanka, Switzerland,
Thailand, Trinidad &Tobago, Tunisia, Uruguay, Zambia, andZimbabwe.
1Counting theECasasingle Member forpurposes ofthelegislative notification.G/SG/W/181
Page3
12. Thesubstance ofthereview oflegislative notifications isreflected inthewritten questions put
toMembers andthewritten answers tothose questions. References tothequestions andanswers
pertaining toeachnotification canbefound intheminutes ofthemeetings atwhich thenotifications
were reviewed (G/SG/M/5+Suppls.1 and2,G/SG/M/6 andG/SG/M/7).
13. Asofearly May, theCommittee hadconducted aninitial review ofalmost allnotifications
received tothatpoint, infourspecial meetings. TheCommittee therefore decided thatfortheimmediate
future, review oflegislative notifications should takeplaceinthecontext ofregular Committee meetings,
rather thaninspecial meetings called forthatpurpose.
14. TheCommitteeadoptedproceduresforfuturereviewsoflegislativenotifications(G/SG/W/116).
Theprocedures forfollow-up review ofpreviously-reviewed legislation would bebased onaprocess
ofwritten questions andanswers, tofacilitate productive discussions during thereview sessions. The
procedures forreview ofnewandamended legislations would bethesame asthose usedduring the
special meetings toreview legislation.
15. Notallwritten questions puttoMembers during thecourse ofthelegislative review meetings
hadbeen answered attheendoftheperiod under review. Nonetheless, theChairman expressed
satisfaction withthereview process. Questions puttoMembers ranged fromthose regarding general,
policy matters toveryspecific andhighly technical questions ofnational administration ofsafeguard
measures. Among theconcerns raised byMembers were perceived inconsistencies between the
Agreement andbothnewly-enacted legislation andlegislation enacted prior totheentry intoforce of
theAgreement. Inaddition, Members expressed concern regarding thepotential foractions inconsistent
withtheAgreement ifsuchactions arebased onlegislation enacted prior totheentry intoforce of
theAgreement. Another concern wasthecomplexity oftheprocedural andsubstantive requirements
oftheAgreement, andtheneedforsignificant training andeducation, particularly fornewusers of
safeguard measures including developing countries, toensure thatactions weretaken consistently with
theAgreement.
III. Notifications ofpre-existing Article XIXmeasures
16. Duringthereviewperiod,theCommitteecontinueditsreviewofmeasurescoveredbyArticle10
oftheAgreement, i.e.pre-existing Article XIXsafeguard measures, which aresubject tonotification
pursuant toArticle 12.7oftheAgreement. These notifications canbefound indocument series
G/SG/N/2. Inparticular, atits11-12 December 1995meeting, theCommittee reverted toitsdiscussion
ofthenotifications ofsuchmeasures thatithadcommenced atits6November 1995regular meeting.
Thecomments ofMembers withrespect tothesenotifications arereflected intheminutes ofCommittee
meetings (G/SG/M/3, paras. 25-35; andG/SG/M/5, paras. 4-15). Inconnection withthisreview,
itwasnoted thatveryfewpre-existing Article XIXsafeguard measures hadbeennotified. Thequestion
wasraised whether thismeant thatinfactonlyasmall number ofsuchmeasures existed, orwhether
itmight reflect afailure tonotify. Thepossibility ofcounternotification ofsuchmeasures, pursuant
toArticle 12.8oftheAgreement, wasrecalled.
17. Atthe6Mayspecial meeting, therepresentative ofNigeria indicated thatNigeria would notify
totheCommittee itspre-existing Article XIXmeasures which hadbeendiscussed during itsbalance-of-
payments review earlier intheyear(G/SG/M/6, paras. 42-43). Asofthe25October 1996 regular
meeting, thisnotification hadnotbeenreceived.G/SG/W/181
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IV. Notifications under Article 12.7ofmeasures subject totheprohibition andelimination ofcertain
measures under Article 11.1
18. During thereview period, theCommittee continued itsreview ofmeasures covered by
Article 11.1oftheAgreement, i.e.so-called "grey area" measures, which aresubject tonotification
pursuant toArticle 12.7oftheAgreement. These notifications canbefound indocument series
G/SG/N/3. These measures arethose subject tothe"prohibition andelimination ofcertain measures"
under Article 11,i.e.,themeasures specified inArticle 11.1(b). Inparticular, atits11-
12December1995meeting,theCommitteerevertedtoitsdiscussionofthenotificationsofsuchmeasures
thatithadcommenced atits6November 1995 regular meeting. Thecomments ofMembers with
respect tothesenotifications arereflected intheminutes ofCommittee meetings (G/SG/M/3, paras. 38-
56;andG/SG/M/5, paras. 4-15). Inconnection withthisreview, itwasnoted thatveryfewgrey
areameasures hadbeennotified. Thequestion wasraised whether thismeant thatinfactonlyasmall
number ofsuchmeasures existed, orwhether itmight reflect afailure tonotify. Thepossibility of
counternotification ofsuchmeasures, pursuant toArticle 12.8oftheAgreement, wasrecalled.
V. Notifications under Article 11.2 oftimetables forphasing outmeasures referred toin
Article 11.1(b) orforbringing them intoconformity withtheAgreement.
19. During thereview period, theCommittee continued itsreview oftimetables forthephasing
outof"grey area" measures referred toinArticle 11.1(b) oftheAgreement, which timetables aresubject
tonotification pursuant toArticle 11.2oftheAgreement. These notifications canbefound indocument
series G/SG/N/5. These timetables should provide forallmeasures referred toinArticle 11.1(b) to
bephased outorbrought intoconformity withtheAgreement onSafeguards within aperiod not
exceeding fouryears afterthedateofentry intoforce oftheWTO Agreement, subject tonotmore
thanonespecific measure perimporting Member, theduration ofwhich shall notextend beyond
31December 1999.2Atits11-12 December 1995 special meeting, theCommittee reverted toits
discussion ofthenotifications oftimetables thatithadcommenced atits6November 1995 regular
meeting. Subsequently, Slovenia andSouth Africa, which hadnotified thattheyhadrelevant measures,
submitted notifications oftheirtimetables forphasing outthemeasures orbringing themintoconformity
withtheAgreement, andtheECsubmitted asupplement toitspreviously-notified timetables. The
firstofthese notifications wasreviewed attheCommittee 's6May1996special meeting, andthelatter
twoatthe25October 1996 regular meeting. Thecomments ofMembers withrespect tothese
notifications arereflected intheminutes ofCommittee meetings (G/SG/M/3, paras. 57-59; G/SG/M/5,
paras. 4-15; G/SG/M/6, paras. 3-6; andG/SG/M/7).
VI. Notifications under Article 12.1ofinitiation ofaninvestigation, making afinding, orapplying
orextending asafeguard measure
20. Under Article 12.1(a) oftheAgreement onSafeguards, Members arerequired toimmediately
notify theCommittee uponinitiating aninvestigatory process relating toserious injury orthreat thereof
andthereasons forit.Under Article 12.1(b) oftheAgreement, Members arerequired toimmediately
notify theCommittee upon making afinding ofserious injury orthreat thereof caused byincreased
imports. Under Article 12.1(c) oftheAgreement, Members arerequired toimmediately notify the
Committee upon taking adecision toapply orextend asafeguard measure.
2Onlyonesuchexception exists, i.e.,theEC'smeasure indicated intheAnnex totheAgreement.
Allother Members hadtheopportunity tonotify, within 90daysoftheentry intoforce oftheWTO
Agreement, (i.e., notlaterthan31March 1995), asingle suchexception. Nosuchnotifications were
received.G/SG/W/181
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21. Atits11-12December1995specialmeeting,theCommitteerevertedtoitsreviewofnotifications
ofinitiations ofinvestigations fromKorea andtheUnited States thatithadcommenced atitsregular
meetingof6November1995.(G/SG/N/6/KOR+Suppl.1andG/SG/N/6/USA.)Subsequently,additional
notifications under Article 12.1(a) ofinitiations ofinvestigations were received, from Brazil, Korea
andtheUnited States. (G/SG/N/6/BRA/1, G/SG/N/6/KOR/2 andKOR/3, andG/SG/N/6/USA/2 and
USA/3.) These notifications were reviewed attheCommittee 's6May1996 special meeting and
25October 1996 regular meeting. Thecomments ofMembers withrespect tothese notifications are
reflected intheminutes ofCommittee meetings (G/SG/M/3, paras. 5-24; G/SG/M/5, paras. 4-15;
G/SG/M/6, paras. 7-11; andG/SG/M/7).
22. During thereview period, anotification under Article 12.1(b) ofafinding ofserious injury
orthreat thereof caused byincreased imports wasreceived fromtheUnited States (G/SG/N/8/USA/1).
Thisnotification wasreviewed attheCommittee 's25October 1996regular meeting. Thecomments
ofMembers withrespect tothisnotification arereflected intheminutes ofthismeeting (G/SG/M/7).
23. During thereview period, anotification under Article 12.1(c) wasreceived from Brazil
concerning application ofaprovisional safeguard measure (G/SG/N/7/BRA/1). Thisnotification was
reviewed attheCommittee 's25October 1996regular meeting. Thecomments ofMembers withrespect
tothenotification arereflected intheminutes ofthismeeting (G/SG/M/7).
VII. Notifications under Article 12.5Concerning Consultations Pursuant toArticles 12.3and12.4
24. Article 12.5oftheAgreement requires thatMembers notify theCouncil forTrade inGoods
(through theCommittee onSafeguards, perArticle 12.10) oftheresults ofconsultations undertaken
pursuant toArticles 12.3and12.4oftheAgreement, i.e.,pertaining totheimposition ofsafeguard
measures orprovisional safeguard measures, respectively. During thereview period, onesuch
notification wasreceived, fromBrazil, regarding theresults ofitsconsultations withtheEConBrazil 's
provisional safeguard measure (G/SG/5-G/L/110). Thisnotification wasreviewed attheCommittee 's
25October 1996 regular meeting. Thecomments ofMembers withrespect tothenotification are
reflected intheminutes ofthismeeting (G/SG/M/7).
VIII. Formats fornotifications
25. Atits24February 1995special meeting, theCommittee approved aseries ofsuggested formats
forthevarious notification obligations under theAgreement. These formats wereoriginally circulated
indocumentG/SG/W/1.Subsequently,certainoftheformatswererecirculatedindividuallyindocuments
G/SG/N/1-N/6.Duringthereviewperiod,theremainingformatswererecirculatedindocumentG/SG/1.
26. Atits6May1996specialmeeting,theCommitteeadoptedaformatfornotificationoftermination
ofasafeguards investigation where nosafeguard measure isimposed. Although theAgreement does
notrequiresuchnotifications,theCommitteedecidedthatitwouldbedesirablefortransparencypurposes
toestablish amechanism forMembers tocommunicate totheCommittee thattheyhadterminated or
concluded aninvestigation which hadbeeninitiated andnotified totheCommittee under theAgreement,
butwhich hadnotresulted inimposition ofsafeguard measures. Theadopted format wascirculated
indocument G/SG/2.
IX. Other matters discussed bytheCommittee
27. Procedures forpreparation andadoption ofAnnual Report: Atits6May1996special meeting,
theCommittee considered theprocedures forthepreparation andadoption ofitsannual report adopted
atitsfirstmeeting inFebruary 1995, inlightofsuggestions fromtheChairman oftheGeneral Council.
TheCommittee decided thattheSecretariat should prepare adraftreport inthesame format ashadG/SG/W/181
Page6
beenusedintheprevious year'sreport, incorporating fromthatreport those aspects ofimplementation
thatwould helpexplain theprogress thattheCommittee hadmade. Thedraftreport would becirculated
toMembers inlateSeptember orearly October, atwhich timetheCommittee would havetodecide
whether itshould meetinformally inadvance oftheregular October meeting todiscuss anyadditional
matters forinclusion inthereport.
28. Progress inphasing outpre-existing measures: Inaccordance withadecision atitsspecial
meeting of24February 1995, Members reported totheCommittee, atthe25October regular meeting,
astotheirprogress inphasing outpre-existing Article XIXmeasures andmeasures subject toprohibition
andelimination under Article 11.1oftheAgreement. Thecomments ofMembers onthissubject are
reflected intheminutes ofthemeeting (G/SG/M/7).
29. Assistance under Article 13.1(b), (c)and(d):Pursuant toadecision oftheCommittee atits
6November 1995 meeting, requests forassistance onmatters referred toinArticle 13.1(b), (c)and
(d)aretobehandled onanadhocbasis. During thereview period, nosuchrequests werereceived
bytheCommittee.G/SG/W/181
Page7
ANNEX
SAFEGUARDS LEGISLATIVE NOTIFICATIONS
MEMBER NOTIFICATION PROVIDED
Antigua andBarbuda
Argentina X
Australia X
Bahrain
Bangladesh
Barbados
Belize
Benin
Bolivia X
Botswana
Brazil X
Brunei Darussalam
Burkina Faso
Burundi
Cameroon
Canada X
Central African Republic
Chile X
Colombia X
Costa Rica X
Côted'Ivoire X
Cuba X
Cyprus
Czech Republic X
Djibouti
Dominica
Dominican Republic X
European Community X
Ecuador XG/SG/W/181
Page8
MEMBER NOTIFICATION PROVIDED
Egypt X
ElSalvador X
Fiji
Gabon
Ghana X
Grenada
Guatemala X
Guinea Bissau
Guinea, Rep.of X
Guyana
Haiti
Honduras X
Hong Kong X
Hungary X
Iceland X
India X
Indonesia X
Israel X
Jamaica
Japan X
Kenya X
Korea X
Kuwait
Lesotho
Liechtenstein
Macau X
Madagascar
Malawi
Malaysia X
Maldives X
MaliG/SG/W/181
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MEMBER NOTIFICATION PROVIDED
Malta X
Mauritania
Mauritius X
Mexico X
Morocco X
Mozambique
Myanmar X
Namibia
NewZealand X
Nicaragua X
Nigeria X
Norway X
Pakistan X
Papua NewGuinea
Paraguay X
Peru X
Philippines X
Poland X
Qatar
Romania X
Rwanda
Saint Kitts&Nevis
Saint Lucia X
Saint Vincent &Grenadines
Senegal
Sierra Leone
Singapore X
Slovak Republic X
Slovenia X
Solomon Islands
South Africa XG/SG/W/181
Page10
MEMBER NOTIFICATION PROVIDED
SriLanka X
Suriname
Swaziland
Switzerland X
Tanzania
Thailand X
Togo
Trinidad andTobago X
Tunisia X
Turkey X
Uganda X
United Arab Emirates
United States X
Uruguay X
Venezuela X
Zambia X
Zimbabwe X