RESTRICTED
WORLD TRADE G/SG/Q1/JPN/6
23September 1996
ORGANIZATION(96-3744)
Original: English Committee onSafeguards
NOTIFICATION OFLAWS AND REGULATIONS UNDER
ARTICLE 12.6OFTHE AGREEMENT
Replies ofJAPAN1toquestions posed bytheUNITED STATES2
Thefollowing communication, dated 11September 1996, hasbeenreceived fromthePermanent
Mission ofJapan.
_______________
Q1. Thefirst36pagesoflawsandregulationsnotifiedbyJapanincludelawsandregulationsrelating
toforeign exchange andforeign trade controls andcertain customs laws. Withtheexception ofarticle 9
oftheCustoms Tariff Lawandcertain other minor exceptions, whyhavethese lawsandregulations
beennotified?
A1. Weprovided thefulltextsofthesafeguard-related lawsandregulations ofJapan inaccordance
withouragreement attheSpecial Meeting ofthisCommittee inFebruary 1995. Observing thevolume
ofournotification, however, wemust confess thatwehaveabided bysuchagreement alittletoo
faithfully. Recalling howmuch work weneeded intranslating them intoEnglish, weareobliged to
appreciate theWTO Secretariat 'sefforts intranslating them intoother WTO languages.
Q2. Certain provisions within theForeign Exchange andForeign Trade Control Lawappear to
authorize safeguard-type actions, suchasaprohibition ontheimportation ofcertain technology for
upto4months when suchimportation "might imperil thenational security, disturb themaintenance
ofpublic order, orhamper theprotection ofthegeneral public; ...might adversely andseriously affect
activities ofoureconomy". Para. 3,page20.Also, article 52onpage22provides "Forthepurpose
ofsound development offoreign trade andthenational economy, aperson whoistoimport goods might
beobligated, asCabinet Order provides for,toobtain approval therefor"; andarticle 55,alsoon
page22,which provides authority torequire "awarranty intheformofcash, securities, etc.,forthe
expansion of...importation". What istherelationship ofthese measures withJapan ’sobligations
under theAgreement onSafeguards?
A2. There isnorelationship between those measures andJapan'sobligations under theAgreement
onSafeguards because those provisions oftheForeign Exchange andForeign Trade Control Laware
notrelated tothesafeguards. Among theprovisions oftheForeign Exchange andForeign Trade Control
Law, onlyArticle 52isrelated tothesafeguards.
1G/SG/N/1/JPN/2 +Corr.1
2G/SG/W/105G/SG/Q1/JPN/6
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Q3. (a) WhydoesJapan maintain twodifferent setsofregulations forsafeguard measures,
oneforwhen themeasure isintheformofaquota, andasecond forwhen itisin
theformofaduty?
A3. (a) Itisbecause wedidnotfinditnecessary tochange ourlegislative framework where
thelegislation forquantitative restrictions andthelegislation fortariffmeasures existed
separately. Inthecaseoftaking safeguard measures, however, itisensured thatthe
procedures shallbeconducted jointly andcollectively.
(b) Unless thenature ofthesafeguard measure tobetaken hasbeenpredetermined, how
isitdetermined, attheoutset, whether theinvestigation istobeconducted bythe
Minister ofInternational Trade andIndustry orbytheMinister ofFinance?
(b) Those investigations shallbeconducted jointly andcollectively andthefindings ofthe
investigations shallbeprocessed inthesame manner. Actual form ofthesafeguard
measure shallbedetermined aftersuchjointinvestigations.
(c) There appear tobesubstantive andprocedural differences between thetwosetsof
regulations. Forexample, under article 2oftheregulations relating toimport quotas,
thedomestic industry appears tobedefined interms ofproducers oflike"and" directly
competitive products, butunder article 1oftheregulations relating toemergency duties
andarticle 9oftheCustoms Tariff Lawitisdefined interms oftheproducers oflike
"or"directly competitive products. Notification requirements isarticles 10(quotas)
and2(duties) oftherespective regulations alsodiffer. Forexample, unlike article 10,
article 2oftheregulations relating toemergency import quotas requires amoredetailed
product description; appears toallow fornotification ofaninvestigation already
initiated, asopposed toonethatwill("shall") beinitiated; andappears toindicate
theperiod oftimeduring theinvestigation willbeconducted, asopposed totheperiod
timethattheinvestigation willcover (e.g., import andindustry trends overthepast
3-5years). Arethere realdifferences and,ifso,why?
(c) There musthavebeenanerror inthetranslation. The"and" referred toinArticle 2
oftheRegulations should betranslated as"or".
Asamatter offact,aspointed outbytheUnited States, there aresome differences
intheexpression oftherequirements between theRegulations andtheCustoms Tariff
LawandtheCabinet Order relating toEmergency Duties butthere isnosubstantial
difference between them.
Q4. (a) Isthereanyprocedure under Japanese laworregulation thatallows producers, atrade
association ofproducers, oralabour union orgroup ofworkers topetition theMinister
ofInternational Trade andIndustry and/or theMinister ofFinance foraninvestigation
and,ifthatpetition isingoodorder, requires theMinister(s) toconduct aninvestigation
andmake afinding?
A4. (a) Theanswer isno.According totheprovisions ofdomestic legislation, theinvestigation
forsafeguards isinitiated exofficio .Accordingly, thepetition bythedomestic industry
doesnotnecessarily leadtothecommencement ofinvestigation.
(b) Ifyes,whatarethepetitioning andother requirements?
(b) Noneedtoanswer.G/SG/Q1/JPN/6
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(c) Ifthere isnoprovision forthefiling ofapetition, areanywritten submissions seeking
aninvestigation filedbyindustry representatives withaminister made available for
review byinterested parties during thecourse ofaninvestigation?
(c) Inthedomestic legislation, interested parties mayinspect theevidence which isused
during thecourse ofaninvestigation. Soifthisisthecase, interested parties may
inspect written submissions seeking aninvestigation.
Q5. IfJapan, under Article 5:5ofitsregulations governing thesizeofimport quotas, allocates
shares ofaquota inamanner other thanthatprovided forinarticle 5:2(a) oftheAgreement on
Safeguards, doesJapan firstintend toengage inconsultations under theauspices oftheCommittee
onSafeguards andclearly demonstrate totheCommittee thatimports fromcertain WTO members have
increased disproportionately inrelation tototalimports?
A5. Theanswer is"Yes".
Q6. Under Article 13ofitsregulations relating toimport quotas, doesJapan make available to
thepublic thenon-confidential evidence relating totheinvestigation, ordoesitlimitinspection ofsuch
evidence onlytothose whohave been abletodemonstrate thattheyareinterested parties inthe
investigation, assuggested inarticle 13:2? Howisinterested party defined, andhowareinterested
parties notified oftheinvestigation andoftheirrights toobtain suchevidence?
A6. Thelatter approach willbetaken. (Under Article 5oftheCabinet Order Relating Emergency
Duties andArticle 13oftheRegulations, onlytheinterested parties canhaveaccess tosuchevidence.)
Theinterested parties aredefined as"exporters andproducers oftheproduct andtheirassociations,
importers ofsuch product andtheir associations, domestic producers ofsuch product andtheir
associations andlabour unions representing those workers whoareengaged inthedomestic production"
inArticle 12oftheRegulations andArticle 4oftheCabinet Order Relating toEmergency Duties.
those interested parties arenotified ofthecommencement oftheinvestigation andother related matters
bytheofficial Gazette.
Q7. Does Japan provide interested parties withthe"opportunity torespond tothepresentations
ofothers", asrequired byarticle 3:1oftheAgreement onSafeguards?
A7. Theanswer is"yes".
Q8. Inmaking determinations under either setofregulations, whatdefinitions oftheterms "serious
injury" and"threat ofserious injury" doestheminister apply, andwhateconomic factors doeshetake
intoaccount?
A8. Suchdefinitions arenotfound inthedomestic legislation. However wewillevaluate allthe
factors listed inArticle 4.2(a) oftheAgreement onSafeguards, when wedetermine the"serious injury
orthreat thereof".
Q9. Article 9oftheCustoms Tariff Lawdoesnotcontain alimitation onsafeguard actions similar
tothatinarticle 5:1oftheAgreement onSafeguards ("AMember shallapply safeguard measures only
totheextent necessary toprevent orremedy serious injury andtofacilitate adjustment"), butinstead
authorizes "adutyinanamount equal toorlessthantheamount corresponding tothedifference between
thecustoms value ofthesaidproduct andthewholesale price inJapan oflikeorsimilar product ...".
HowdoesJapan intend toinsure thatanymeasures taken willbeonlytotheextent necessary toprevent
orremedy serious injury andfacilitate adjustment?G/SG/Q1/JPN/6
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A9. When Japan takes asafeguard measure, itabides bytherequirements intheprovisions ofthe
Agreement onSafeguards. Thenon-existence oftherelevant provision does notmean thatthe
administrative authority disregards suchrequirements.
Q10. Article 9:6oftheCustoms Tariff Lawandfollowing paragraphs appear toauthorize thetaking
ofaprovisional safeguard measure forupto200days.
(a) Ifthisisthecase, aside from"sufficient evidence" ofincreased imports andserious
injury, what isthestandard thatmustbeapplied indetermining whether there isa
basis fortaking suchaction?
A10. (a) InJapan, provisional measures canbetaken onlyastariffmeasures. Under Paragraph 8
ofArticle 9oftheCustoms Tariff Law, ifthefactofimport increase ofaparticular
product andthefactofserious injury toadomestic industry caused bysuchimportation
arepresumed based onsufficient evidence anditisdeemed particularly andurgently
necessary intheinterest ofthenational economy, theGovernment maytaketariff
measures evenprior tothecompletion oftheinvestigation inaccordance withthe
Agreement onSafeguards.
(b) Does Japan intend, through these paragraphs, toauthorize thetaking ofprovisional
safeguard measures thatconform withthose authorized byarticle 6oftheAgreement
onSafeguards? Ifso,whyisthere noreference totheterm"critical circumstances"
ortothedefinition ofthatterminarticle 6oftheAgreement, ortothe"clear evidence"
testrequired byArticle 6?
(b) Theansweris"yes".Asfortherequirementsfortakingprovisionalsafeguardmeasures,
weinterpret "thecasewhere itisdeemed particularly andurgently necessary inthe
interest ofthenational economy" referred toinparagraph 8ofArticle 9oftheCustoms
Tariff Lawashaving thesame meaning as"thecritical circumstances where itwould
bedifficult torepair" referred toinParagraph 1ofArticle 6oftheAgreement on
Safeguards. Weinterpret "sufficient evidence" ashaving thesame meaning as"clear
evidence".
(c)WhointheJapanese Government makes thedetermination concerning whether the
standard fortaking suchanaction issatisfied?
(c) TheCabinet makes suchdetermination.
Q11. Thebasisforextending theperiod ofasafeguard measure under Japanese regulations appears
todiffer fromthatunder article 7:2oftheAgreement onSafeguards--under article 7:2there mustbe
afinding thatthesafeguard measure "continues tobenecessary toprevent orremedy serious injury
andthatthereisevidence thattheindustry isadjusting". Forexample, under article 18oftheJapanese
regulations relating toimport quotas, ameasure maybeextended bytheMinister ofInternational Trade
andIndustry "because oftheimportation intoJapan ofsuchparticular product inincreased quantities
andthattheDomestic Industry Concerned isthenintheprocess ofstructural adjustment." Howdoes
Japan 'stestforextending asafeguard measure conform totherequirement inarticle 7:2ofthe
Agreement? Whydoesthestandard forextending ameasure inarticle 18differ fromthatinarticle 9:10
oftheCustoms Tariff Lawforextending ameasure intheformofaduty?
A11. Therequirement forextending safeguard measures referred toinparagraph 10ofArticle 9
oftheCustoms Tariff LawandinArticle 18oftheRegulations areconsistent withthose referred to
inparagraph 2ofArticle 7oftheAgreement onSafeguards. Therequirements between thelawandG/SG/Q1/JPN/6
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theRegulations areessentially thesame, andthedifference intheexpression isonlytechnical innature,
butwhich became inadvertently exaggerated through thecourse oftranslation bydifferent translators.