RESTRICTED
WORLD TRADE WT/REG/M/9
1May1997
ORGANIZATION(97-1906)
Committee onRegional Trade Agreements
Ninth Session
NOTE ONTHE MEETINGS OF17AND 18MARCH 1997
Chairman: H.E. Mr.JohnWeekes (Canada)
A. Adoption oftheAgenda
1. Themeeting wasconvened inWTO/AIR/549. TheChairman noted thattheJapanese delegation
hadasked thataninformal paper itwassubmitting onGATS Article V:1beinserted under “Other
Business. ”Thefollowing agenda wasadopted:
A. Adoption oftheAgenda
B. Examination ofRegional Trade Agreements:
I. EFTA-Israel FreeTrade Agreement
II. EFTA-Hungary FreeTrade Agreement
III. EFTA-Poland FreeTrade Agreement
IV. EFTA-Bulgaria FreeTrade Agreement
V. EFTA-Romania FreeTrade Agreement
VI. EFTA-Slovenia TreeTrade Agreement
C. Procedures toFacilitate andImprove theExamination Process
D. Reporting ontheOperation ofAgreements
E. Systemic Implications ofAgreements andInitiatives fortheMultilateral Trading System
andtheRelationship Between Them
F. Other Business
B. Examination ofRegional Trade Agreements
Reports onthese examinations arebeing circulated asseparate documents.
C. Procedures toFacilitate andImprove theExamination Process
2. TheChairman saidthattheSecretariat hadcirculated tworevised papers fordiscussion: one
ontheStandardFormatforServices,andoneonDraftGuidelinesonProcedurestoImproveandFacilitate
theExamination Process. Heasked theCommittee totakeupthedraftStandard Format first.
3. Therepresentative oftheEuropean Communities saidthathisdelegation hadnotyethadthe
opportunity toconsider therevised Standard Format indetail.WT/REG/M/9
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4. Therepresentative oftheUnited States saidthathisdelegation, too,would needmore time
toconsider thedraftStandard Format.
5. Therepresentative ofAustralia saidhehoped thatparties toRTAs would make useofthe
Standard Format topresent information. Hereferred tosection I,paragraph 3,saying thatthewording
wassomewhat confusing. Article Ventailed obligations withrespect tomodes ofdelivery, soitwould
seem itsintent wasforthere tobecoverage ofparticular sectors.
6. Therepresentative ofMexico saidhisdelegation would needmore timetoconsider thedraft
Standard Format.
7. Therepresentative ofCanada saidhisdelegation would needtimeforitsservices experts to
gothrough thedraft. Hereferred tosection I,paragraph 2onrulesoforigin, where itwassuggested
thattheinformation include cases andsectors where treatment required under GATS Article V:6was
notgranted. Hisdelegation would likethere tobesome clarification ofwhythatinformation would
bepertinent, since presumably theinformation would have tobeprovided intheearly days of
implementation oftheagreement. Inalllikelihood, there would notbeanysuchcaseorsector. It
might bebetter iftheitemwerewritten inamore general way,soastoaskwhattestsanagreement
applied toascertain whether there were substantive business operations thatmetthecriteria of
Article V:6.
8. Therepresentative oftheEuropean Communities explained thatpartoftheStandard Format
wasdesigned toseeifaneconomic integration agreement itself provided ageneral framework for
determining ifthere weresubstantive business operations, orifthisdetermination wasdonethrough
various administrative procedures. Thismight raisethequestion ofhowGATS Article V:6interfaced
withagreements which provided fordecisions tobetaken onacase-by-case basis orwhich resorted
todomestic regulatory procedures. So,thepurpose ofthispartwastoseehowgeneral principles in
anagreement would beoperationalized interms ofactual market access forservice providers.
9. TherepresentativeofNorwaysaidthatthedocumentappearedsatisfactory,butthathisdelegation
would needtoconsider itmore closely. Hereferred tosection I,paragraph 4andasked forclarification
onthewording "data onnational products."
10. Therepresentative ofJapan saidthathisdelegation hadputforth theideainthatparagraph.
Heexplained thatitwasgeared toward getting asense ofhowmuch ofagiven services sector was
actually excluded orreserved. Inorder toseethatmagnitude, itseemed theCommittee needed to
havecertain data. Because services datasometimes proved difficult toobtain, hisdelegation had
suggested using services datafound ingross national product (GNP) compilations asanalternative,
which could show themagnitude ofexcluded orreserved sectors. Thissuggestion wasreflected in
thenon-paper circulated fordiscussion under Other Business. Since services markets should beopen
among parties toafree-trade area,thedomestic market ineffect could entail theparties 'market taken
asawhole. TheGNP datacould thusbeusedtoshow thesizeoftheservices sector subject to
liberalization. Forexample, GNP dataonthesizeofthetelecommunications sector could indicate
thepotential market fortelecommunication services within theregion. Itseemed theCommittee would
needtodofurther work inthatregard.
11. TheChairman responded torequests formoretimetoreview thetextwithcapitals andsuggested
theCommittee return tothedraftatitsnextmeeting, attheendofApril. AtthattimetheCommittee
could takenoteofthefinalproduct.
12. Therepresentative ofSwitzerland suggested thatthenextdraftbesenttodelegations wellahead
ofthenextmeeting.WT/REG/M/9
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13. TheChairman asked delegations tosubmit totheSecretariat further comments inwriting. He
thenturned tothedraftProcedures toFacilitate andImprove theExamination Process.
14. Therepresentative ofHong Kong saidthatthetwo-tiered approach hadnotbeenincluded in
thepartonnotification, despite thefactthatithadhadagood dealofsupport; ageneral invitation
encouraging parties toprovide information didnotseemastrong enough substitute fortheidea. There
seemedtobemeritinseparatingtheinitialnotificationfromthesubmissionofinformationintheStandard
Format oranother form. Thelegalstatus ofcounter-notification wasunclear, and,asthere wasno
objection, itseemed theideashould beomitted. Members could always bring upanon-notified RTA
under Other Business. Hisdelegation supported therevisions concerning thetiming ofthesubmission
ofinformation, asthisafforded certainty andatthesame timeallowed forflexibility inthatuseof
theStandard Format wasnotobligatory. Regarding partIII,itmight beadvisable tosetalimiton
thenumber ofmeetings foragiven examination.
15. Therepresentative oftheEuropean Communities recalled thepointmade inprevious discussions
regarding theimportance ofprocedural flexibility. Intheenditwasthereports thatwould count,
notthemeans forproducing them. TheChairman ’sGuidelines contained rather precise time-frames,
particularly inparagraphs 7and12;hisdelegation wasnotcomfortable withthese, astheywould be
prone tobeing construed asarigid requirement andastheywould notlikely helpthework ofthe
Committee. Paragraph 10dealtwiththeback-to-back examination ofgoods andservices aspects of
RTAs, butthereasons setoutwere notconvincing. While back-to-back examinations might allow
economies ofscale bybringing experts together, there didnotseem tobearealneedforcombining
thetwosince thedifferent requirements didnotentail duplication. Itdidnotseem evident that
homogeneity would beserved. Thepoints onreporting werespeculative andmight needtoberevised.
TheCommittee should remember thatthereports would beforwarded totheappropriate body.
16. Therepresentative ofBrazil saidsome ofthedifficulties hadbeencleared up,inparticular
theproblem ofdifferentiating thevarious stages oftheexamination. Itwasnowclear that“initial
information ”referred toinformation provided either intheStandard Format orinaquestion-and-answer
process. Perhaps thechoice tousetheStandard Format could beleftopensothatparties would not
havetodecide immediately whether ornottouseit.Thefour-month period seemed problematic; much
information might notbeavailable inashort period oftime, sothere should besufficient flexibility.
17. Therepresentative ofAustralia referred tothesubmission ofinitial information, asdetailed
insection II.Because information from RTA parties often wasnotthorough, perhaps theChairman
should emphasize themoral obligation thatdelegations shared inthisrespect. Itseemed thatsome
incentives should bebuiltintotheGuidelines sothatreviews andconclusions could behandled relatively
quickly. Ofcourse, flexibility wasnecessary forensuring support fortheendresult ofagiven
examination, buttiming should betaken seriously. Ageneral timelimitthathadroom forchange
would behelpful. Hisdelegation, too,wassorry thatthetwo-tiered notification ideahadbeendropped.
Concerning non-compliance, thecallforcounter-notification seemed tolacksupport. However, for
thesakeofefficiency, itseemed there should beawayfortheCommittee totakeupRTAs thathad
notbeennotified. Perhaps theSecretariat could provide alisting ofthose RTAs itwasaware ofthat
hadnotbeennotified.
18. TheChairman asked theCommittee toregard theprocedures asevolutionary, tobereassessed
afterayearorso.Inconsidering howtoobtain information andpromote certainty, theCommittee
hadtoconsider theoptimal timing ofthesubmission ofinformation. Thebiennial reporting process
wasanongoing obligation, sotheCommittee should notviewtheexamination ofanRTAasaone-shot
deal. TheCommittee could return toissues afterseeing whathadhappened invarious respects.WT/REG/M/9
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19. Therepresentative ofJapan hadproblems withparttwo.Heshared theviews ofthedelegations
ofAustralia andHong Kong thattwo-tiered notification wasagoodsuggestion thatshould beincluded.
There wasnoreference tocounter-notification; ashisdelegation hadsaidduring theinformal meeting,
theCommittee could avoid theword butstillleave openthepossibility fordelegations toraisequestions
under Other Business, orforthemtoaskthattheitembeplaced ontheagenda. Anydelegation wishing
toaskquestions should beallowed toregister them. Some delegations saiditwasamatter ofcourse
anddidnotneedtobementioned onthechecklist. But,considering thenumber ofnon-notified RTAs,
itshould belisted. Regarding timing, therewasaneedforflexibility, asexpressed bytherepresentative
oftheEC.Onepossibility would betohaveaprinciple allowing forflexibility. Pastexperience showed
thatinformation tended tobesubmitted rather late. Itwaspractically impossible tohavemeaningful
examinations inthatway.Efficient examinations required thisproblem tobeaddressed. Thethree-week
requirement wasagoodone-theexact timewasnotsoimportant, butrather theimportant thing was
thatinformation besubmitted inadvance ofmeetings.
20. TheChairman quipped thatcapitals might needtobetoldmeetings would beheldearlier than
theyactually would be.Itseemed thedeadline forthemeeting became thedeadline fortheprovision
ofinformation. IftheCommittee postponed themeeting toallow forthereceipt ofinformation, it
might never accomplish itstask. TheCommittee needed toreinforce appropriate, normative behaviour
overtime. Another observation concerned two-tiered notification. Inthedraftdocument theSecretariat
hadtriedtocapture thenotion ofinitial notification inparagraph 1.Thiswasbecause ofthedistinction
thatwasmade between legal requirements andthedesire forparties tosubmit information. The
representative ofJapan hadmentioned theideaofencouraging parties toshare information. Also,
therepresentative ofBrazil hadasked ifitwasan"either/or" choice ofusing theStandard Format or
thequestion-and-answer process. Thequestion-and-answer process hadalways beenviewed asanoption
inaddition totheStandard Format. Tocombine flexibility andcertainty, theremight bevalue inbuilding
intheideathatimmediately afternotification ortheagreement 'sbeing referred totheCommittee, the
parties could sitdown withtheChairman orSecretariat todiscuss howtoproceed. Guidelines which
applied inallcircumstances would nottakeintoaccount thedifferences oftheagreements, sothisidea
would allow common-sense flexibility forproceeding casebycase. Regarding counter-notifications,
theSecretariat hadtriedinthefirstparagraph toaddress this.
21. TherepresentativeoftheUnitedStatessaidthatestablishingnotionaltime-frameswhileremaining
flexible wasimportant. Theframework justproposed bytheChairman seemed appropriate, andthe
Committee seemed tobemoving intherightdirection. Hisdelegation alsosupported thetwo-tiered
approach. Perhaps aslight drafting change could incorporate theideamore strongly. Guidelines for
Members toraiseconcerns about non-notified agreements could begood, asthiswasanimportant
issue. Thecomments bytherepresentative ofJapan regarding sensitivity totheword “counter-
notification ”were welltaken, butwording needed tobealittlestronger thanwaspresently inthe
Guidelines. Yes,itwasanevolving procedure.
22. Therepresentative ofCanada saidhisdelegation would haveliked amore explicit reference
tothetwo-tiered notification ideainthefirstparagraph. Regarding thetime-frame, itwasimportant
forthedocument toprovide some guidance, notonlyfortheCommittee andfordelegations ingeneral,
butalsoforparties under review. Thesuggestion tooutline arough time-frame withtheparties at
thestartoftheexamination process would beanimprovement. Section IIwassomewhat unclear
regarding questions andreplies, though theCommittee hadalways beenclearthatdelegations could
submit additional questions. Subparagraph (b)ofsection IIIseemed tocarry areference tothatidea,
butthepoint could bemade more strongly.
23. Therepresentative ofSwitzerland saidhehadtwelve points. Regarding paragraph 1ofthe
draft, thefirstsentence seemed toinclude thetwo-tiered approach. Perhaps itcould berefined, but
theideawasthere. Thatwassomething hisdelegation tookseriously. Thesecond sentence tookintoWT/REG/M/9
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account thediscussion oncounter-notification; itwasuptodelegations topresent items under
Other Business. ItwasnotfortheSecretariat towrite anoteonnon-notified agreements, thatwas
theresponsibility ofdelegations. Concerning theinitial information onRTAs, hisdelegation appreciated
thepoints made bytherepresentatives ofBrazil andCanada; asimple modification could fixthewording
tomean "and/or". Inthelaterpartofthedocument, itwasclear thattheparties hadachoice in
submitting theStandard Format, andthatsolved thetiming problem tosome extent. Regarding
paragraph 7,timing wasimportant, aspastexperience hadshown. Thetiming elements would be
guidelines fromtheChairman fororganizing work andwould notconstitute anewrequirement. Along
withthedelegation ofJapan, hisdelegation could support anotional time-frame. Regarding the
circulation ofdocuments andthelinkwiththeexamination, itcould beuseful tosaysomething tothe
effect thatthemeeting might bepostponed ifinformation hadnotbeenprovided inadvance. That
included alltheaspects oftheflowofinformation. Theideainparagraph 9fortheSecretariat to
recapitulate thesituation seemed appropriate, andperhaps theupdate could becirculated periodically
andrefertonewdocuments. Paragraph 10saidthattheaimofhaving back-to-back goods andservices
examinations wastoensure homogenous endresults; while perhaps notthebestreason, butitwas
sufficient. Regarding paragraph 12andhaving thesummary records three-weeks inadvance, itwould
benicetohavethisasarequirement, butthesewereonlyGuidelines. Thelastsentence ofparagraph 15
could leadtomisunderstanding; theCommittee didnotwanttonegotiate thefactual part,butthesentence
could indicate thattheCommittee would adopt thereport. Themandate required thereport tobesent
toother bodies. Regarding paragraph 16,theCommittee ’sassessment ofanRTA should bemade
inlightofrelevant provisions, butalsothesentence should mention themandate. Regarding thetwo
footnotes,hisdelegationsupportedthemstrongly.HavingpartiesmeetwiththeChairmanandSecretariat
early ontoorganize theexamination process would beuseful.
24. Therepresentative ofNorway saidthattheideaofthetwo-tiered approach didseem tobe
encompassed inparagraph 1,butitcould bemade more explicit. Regarding counter-notification, the
formulation captured theessence ofinformal discussions, though whathadbeensaidcould bespelled
outmore directly. Regarding paragraph 5,hisdelegation would liketoseethisnotas"either/or" but
asencouraging thesubmission oftheStandard Format, somaybe theCommittee should change the
sequence andstrengthen thewording. Looking atparagraphs 6and7together, hesaidheliked the
United States 'ideaofahaving anotional time-frame withflexibility builtin.TheChairman 'sidea
forparties tositdown withtheSecretariat andhimandindicate whether theywould submit theStandard
Format seemed constructive. Theresults could bepresented atthefollowing meeting, soastoput
alittlepressure ontheparties andtoallow theCommittee todiscuss thetime-frames, which ofcourse
would retain flexibility. Circulation ofsummary records three weeks inadvance ofmeetings would
help. Regarding paragraphs 15and16,hisdelegation wasconcerned overtheneedforbalance in
thereport, withthefactual andconclusions eachbeing partofthewhole. Hisdelegation hadnoobjection
totaking noteofthefactual part. Thesummary records should bepresented toparties forcorrection
before theywere beissued asformal documents.
25. Therepresentative ofKorea saidthathisdelegation favoured strong language fortwo-tiered
notification andcounter-notification. Paragraph 1should notbeaseparate heading, butshould come
under theheading Notification, eventhough thetwowerenotlegally linked. Regarding paragraph 7
andtheideaofnotional time-frames, hisdelegation, too,supported thisideaaselaborated bythe
representative ofJapan. Perhaps there could besome reference tothegeneral structure orschedule
ofmeetings fortheyear, sothateachexamination could fitintothestructure. Given thatthesituation
might change, thetimeschedule could beupdated ifnecessary. Paragraph 5hadbeendiscussed with
respect tothenature ofthetwooptions. Thefootnote emphasized thepreference fortheuseofthe
Standard Format, butmaybe thisshould beincluded inthemain text. Hisdelegation supported
paragraph 9butwould alsofavour making itstronger byhaving stock-taking ofthedifferent stages
oftheexamination. Regarding paragraph 10,onback-to-back goods andservices examinations, he
found theword "homogeneous" confusing andsuggested thatitbeclarified. Rather thanhavingWT/REG/M/9
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conclusions besimilar incontent, hisunderstanding wasthattheendresult would come together in
terms oftime. Itwasunclear whether paragraph 13referred toprocedural steps. Perhaps paragraph 16
should include areference toinformal consultations onconclusions. Finally, theguidelines were
evolutionary, soexperience would allow improvement. Maybe theCommittee could indicate inthe
preamble theintention toreview theGuidelines later.
26. Therepresentative ofUruguay saidthedocument followed aprocess thatbecame twisted:
there wasmuch repetition ofthepoint thatitwasnotbinding, butitwould haveatendency tobecome
binding inpractice. Looking atthedraftdocument, thefirstparagraph tohimseemed satisfactory,
offeringthepossibilityfordelegationstonotifyearlyandmakecommentsonagreementsnotyetnotified,
while atthesametimenotbecoming aprecondition. There seemed tobemuch support forencouraging
parties tousetheStandard Format. Thefactthatthiswasnotanobligation should bestated clearly,
asthedynamic sometimes seemed toimply anobligation. Regarding time-frames, thebestideaseemed
tobethatoftheChairman: ifofficials came from capitals forameeting withtheChairman and
Secretariat, theywould gainanin-depth understanding oftheobligations andpressures which delegates
faced. Often capitals werefaraway, andworkloads prevented theexamination information frombeing
apriority. Awork programme tailored toeachagreement would make iteasier torespect time-frames.
Paragraphs 8and18wererepetitious. Regarding thedistinction drawn attheendbetween taking note
ofthefactual partandadopting theconclusions, itseemed thatwhen thereport would beadopted,
thewhole package would beadopted. Theideafortaking noteofthefactual partwastoavoid the
typeofnegotiations thathadtaken place inthepast. Ifthere were some other waytoexpress this
idea, theCommittee should include it.
27. TheChairman saidarevised textwould becirculated todelegations priortothenextmeeting,
when theCommittee might takenoteofit.
D. Reporting ontheOperation ofAgreements
28. TheChairman asked thedelegates tooffer suggestions astohowtoproceed withrespect to
reporting ontheoperation ofagreements. TheSecretariat hadcirculated document WT/REG/W/3
onthissubject. There wereinterrelationships between RTA examinations andbiennial reports onthe
operation ofagreements.
29. Therepresentative ofAustralia saidthathisdelegation tooktherequirement ofbiennial reporting
veryseriously, andthatitwaspreparing another paper inthisrespect.
30. TheChairman suggested thattheCommittee come backtothistopic when theAustralian
delegation submitted thepaper.
E. Systemic Implications ofAgreements andInitiatives fortheMultilateral Trading System
andtheRelationship Between Them
31. TheChairman recalled that,attheCommittee ’slastsession, anupdated checklist hadbeen
provided bytheSecretariat. Proposals made atthatmeeting bythedelegations ofHong Kong, Korea
andAustralia werenowavailable ininformal written form. Thedelegation oftheECalsohadoffered
helpful views onhowtheCommittee might proceed. Heasked theCommittee firsttoconsider how
itwished toproceed.
32. Therepresentative oftheUnited States thanked thedelegations ofHong Kong, Korea and
Australia fortheirhelpful proposals. Considering thepoint made about necessary advance timeforWT/REG/M/9
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capitalstoprepareforWTOmeetings,perhapsitwouldbemoreusefulfordelegatestotaketheproposals
totheirrespective capitals since theCommittee would needtodiscuss those reactions later, anyway.
Hisdelegation tooktheissues seriously.
33. Therepresentative ofCanada saidhewished tooffer general comments ontheideaof
comparative orhorizontal studies. Theproposals fromthedelegations ofHong Kong andKorea seemed
tofocus onthechecklist, whereas thatfromtheAustralian delegation tookabroader policy orientation.
TheCanadian delegation welcomed thedifferent ways toapproach systemic implications, butitnoted
thattheCommittee could make aunique contribution through horizontal studies. Thepurpose ofthe
studies would notbetoanalyze theconsistency oftheRTAs withtheWTO, andnottoexamine whether
Annex1AAgreementscouldservethepurposeofregionalintegrationagreements;butrathertheanalysis
could provide insight intoquestions suchasthepromotion ofdisciplines atthelevelofthemultilateral
trading system, etc.Hisdelegation hadtriedtoapproach theinitial paper onTBTfromthatperspective.
TheCommittee might continue thediscussion begun lastfalltofleshoutideas. Theultimate objective
might betodraw some conclusions, astheCommittee 'smandate provided forittomake a
recommendation totheGeneral Council. TheCommittee should availitselfofthisopportunity. His
delegation hoped thishorizontal work could continue.
34. Therepresentative ofJapan referred totheCommittee ’smandate, noting thatitwasbroad.
Thethreeproposals bythedelegations ofKorea, Hong Kong andAustralia would helptheCommittee
identify issues formore in-depth study. There seemed tobesimilarities inthepapers ofHong Kong
andKorea. TheCommittee could agree onthose ideas now, especially therequest tohavechecklist
annotated. Members could build ontheannotation. Regarding theAustralian proposal, there were
richpoints relating tothemandate oftheCommittee. Hisdelegation would liketodiscuss thepaper
more inthefuture.
35. TherepresentativeoftheEuropeanCommunitiesidentifiedthreeseparateissuesunderdiscussion.
TheHong Kong andKorean papers, aswellashisdelegation ’scomments attheprevious meeting,
concerned organizing issues forconsideration. Organizing them andproviding interpretive insights
ontheirimportance would bethepoint. Maybe ageneral fusion oftheapproaches proposed would
workwell. TheCanadian pointonhorizontal studies wasinteresting, asthose studies could compliment
theCommittee ’sexamination work byproviding awaytohighlight linkages. Butthehorizontal studies
should befocused, withtheobjective being tolookattheinteraction ofrights andobligations asthey
affected theconformity ofRTAs soastocomplement theexperience-driven checklist. Thiswould
build onthecoreexamination ofrights andobligations. Perhaps inthefuture thepilotstudies should
belessdescriptive, offering more inquiry intotheWTO rulesatthecentre. Thepoints intheproposal
bytheAustralian delegation raised broader policy questions. Hewondered ifdelegations 'well-equipped
capitals would beabletoprovide instructions fordealing withthose broad propositions which ranacross
notjusttheWTO spectrum, butalsothewhole economic order. Thiscould consume veryconsiderable
resources when theSecretariat already hadagood dealofwork setoutforit.Could thedelegation
ofAustralia make itsproposal more precise? Itwasimportant thattheCommittee seektodoless,
better. TheCommittee should becareful nottogoonanintellectually stimulating paththatwould
notenable ittofulfil itsmandate.
36. Therepresentative ofHong Kong saidheappreciated thepragmatic approach ofthenon-papers.
Heagreed thatperhaps thepapers oftheHong Kong andKorean delegations could bemerged, along
withtheECcomments. Basically, theHong Kong proposal asked fortheSecretariat toprovide
annotation ofissues, classifying them perhaps bytheirnature (e.g., procedural orinterpretive) and
importance orbythetypeofRTA which theyaccompanied. Turning totheCanadian ideafora
horizontal approach, henoted thathisdelegation alsowasinterested inhorizontal work, butsaidit
might bemore useful andefficient fortheCommittee tousewhathadalready beendone. Regarding
theimportant contribution byAustralia, hisdelegation wasoftheviewthatseveral points should beWT/REG/M/9
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explored,includingtheconceptofopenregionalism,costtotraders,andpossiblerulesonstandardization.
Perhaps there could beinformal consultations toexplore ideas andclarify theCommittee 'sapproach.
37. Therepresentative ofBrazil saidthattheproposals made bythedelegations ofKorea and
Hong Kong hadmerit. Hisdelegation, too,would beeager tolookintotherelevant Uruguay Round
papers. However, hisdelegation hadserious differences ofopinion regarding thepaper byAustralia.
Itseemed thatiftheCommittee entered intosuchanalysis, therewould bearepetition ofitexperienced
prior totheSingapore Ministerial Conference. Nowwasnotthetimetoaddress specific divergences
ofview, butanexample ofthedivergent perspectives wasthefactthathisdelegation wasagainst the
ideaexpressed inparagraph 2forathorough re-examination oftheoverall relationship between RTAs
andthemultilateral trading system. Rather, hisdelegation wasprepared tocontinue analysis asitwas
currently being conducted intheCommittee. Paragraph 4entailed looking intothereasons forthe
formation ofRTAs; because thereasons varied toagreat extent, theapproach wastoobroad. The
discussion would become toobroad. Paragraph 5mentioned thelevels ofambition, which, asdiscussed
atSingapore, varied widely. Itdidnotseem possible thattheWTO could beasambitious asparties
wereinRTAs. Forexample, single currency wasnotfeasible onaglobal scaleatpresent, butitcould
beconsidered attheregional level. Thebuilding-blocks argument seemed realistic asawaytoopen
markets gradually.
38. Interms offeasibility, therepresentative oftheUnited States prioritized thepapers as
Hong Kong'sfirst,Korea 'ssecond andAustralia 'sthird. Hong Kong’spaper builtuponthechecklist
inhandling systemic issues arising intheCommittee ’sday-to-day examination work. Itallowed the
Committee togodeeper while moving forward. Thisproposal would place theleastburden onthe
Secretariat, asitwasrealistic. Korea ’ssuggestions would benefit theCommittee, butthere were
twoproblems: itwould constitute avastamount ofadditional work fortheSecretariat, anditwould
require theCommittee todefine priorities, which would slowtheCommittee down. IntheAustralian
paper theissues weresofundamental theywould tietheCommittee upinendless discussion. Perhaps
thesame endscould bereached byusing theHong Kong proposal.
39. Therepresentative ofAustralia hadthreespecific suggestions fortaking upwork. Theproposals
byHong Kong andKorea hadalways beenendorsed byAustralia. AstheECdelegation hadsaid,
theycould befused, withtheSecretariat categorizing issues andpreparing annotations, andthen
suggesting which issues would befeasible forbackground papers. Regarding theCanadian ideato
make more useofhorizontal studies, perhaps theCommittee could consider theTBTandSPSstudies
more atitsnextsession. Ifthere weremany comments, itwould show thistobeanareaforfurther
work; ifcomments werelimited, itwould showthestudies werenotuseful. TheCanadian representative
hadplaced thehorizontal studies inaproper context, aslessons could bedrawn fromregional experience
interms offurther multilateral liberalization andrule-making. Regarding hisowndelegation 'sproposal,
henoted thattheissues putforth werenotsoarcane. Forinstance, theconcept ofopenregionalism
wasabroad andsignificant development. According toitsmandate, theCommittee wasinpart"to
consider theimplications ofsuchagreements andregional initiatives forthemultilateral trading system
andtherelationship between them." Because openregionalism wasamajor focus ofonemajor regional
initiative, theissuefitwithin theCommittee ’smandate. Many ofthespecific points intheAustralian
proposal could bediscussed constructively. Yes,there werewidely divergent views, butperhaps the
Committee should discuss thedifferences rather thanavoid addressing them. While broad positions
hadbeenarticulated bydelegations during preparations fortheSingapore Ministerial Conference, the
Committee hadnever hadanin-depth discussion astothereasons behind thedifferent positions. He
wasinterested inHong Kong'ssuggestion thatinformal consultations beheldontheproposals, and
perhaps theCommittee might select certain specific topics fordeeper discussion inthefuture.
Discussions onsome topics could prove relatively easyandproductive.WT/REG/M/9
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40. Therepresentative ofKorea saidthere seemed tobewiderecognition ofthecompatibility of
theHong Kong andKorean proposals. Hesupported theideaputforth bythedelegate ofAustralia
tostartwiththeannotation andlateridentify areas forbackground papers. Regarding theinquiry by
Brazil concerning availability ofUruguay Round documents, theSecretariat hadindicated tohimthat
atleasttwodocuments, written in1987and1988, werestillrelevant. Regarding theAustralian proposal
andbroadpolicymatters,hisdelegationattachedimportancetotheCommittee’sworkandwouldsupport
discussion ofthese ideas intheCommittee. Perhaps theCommittee should discuss howtoproceed
withtheproposal inaninformal setting.
41. Therepresentative ofJapan saidtheCommittee could asktheSecretariat toproduce anannotated
checklist forthenextmeeting. Regarding thecategorization ofissues, there wasnoproblem withthe
Secretariat doing thiswork ifitwasableto,ortheCommittee might discuss thisatalaterstage. He
agreed thatperhaps agoodapproach inthefuture would betofusetogether elements oftheHong Kong,
Korean andECproposals.
42. Therepresentative ofKorea saidthattheSecretariat could startannotating thechecklist, even
ifdelegations were notinaposition torespond totheproposals.
43. Therepresentative ofSwitzerland saidthat,while hisdelegation didnotoppose theSecretariat 's
doing this,theCommittee should bemindful thattheSecretariat already hadtheconsiderable burden
ofproducing summary records andotherdocuments requested. ItwasuptoMembers toidentify matters
ofsubstance. TheSecretariat haddrawn upthenoteonhorizontal studies, andithadnotbeenfully
used. Rather thanmultiplying theexercises oftheSecretariat, itwould bebetter toconcentrate on
anumber ofelements.
44. TheChairman suggested thattheSecretariat begin toproduce anannotated listasafirststep
toelaborating thework discussed. Because theSecretariat would haveagoodsense ofhowtoapproach
thework, itcould begin producing adocument thatwould notintrude ontherights ofMembers. It
could alsoreflect onthebestwayofproceeding withpotential supplementary studies. Asnoted by
theSwiss delegate, Members, too,hadaresponsibility toconsider theapproach. There seemed to
besupport forreturning tothehorizontal study ontechnical barriers totrade(TBT) attheCommittee 's
nextmeeting. Healsoenvisaged taking upthesuggestion thattheCommittee haveconsultations on
howtoapproach other suggestions, suchasthose putforth bythedelegation ofAustralia.
F. Other Business
45. Therepresentative ofJapan introduced itsnon-paper oninterpreting GATS Article V:1,saying
ithadbeen prepared inconnection withthediscussion atthelastsession andinresponse tothe
Chairman 'sinvitation tosubmit opinions ontheArticle 'sinterpretation. Hisdelegation hoped that
thenon-paper would contribute totheCommittee 'songoing discussion ofsystemic issues. Thefirst
ofthetwomainpoints ofthenon-paper involved theinterpretation of"substantial sectoral coverage",
asfound inGATS Article V:1(a). Given thefootnote, itseemed thatthethree elements -thenumber
ofsectors, thevolume oftrade affected, andthemodes ofsupply -should beconsidered inmaking
judgments astosubstantial sectoral coverage. Inthesecond sentence ofthefootnote, itwasclearthat
anyRTAwhich completely excluded anyofthefourmodes ofsupply ofservices could notbeconsistent
withGATS, andonethatexcluded important sectors might alsohaveconsistency problems. Therefore,
there wasaneedforobjective criteria toassess themagnitude ofexcluded sectors. Statistics were
notalways wellsuited totheGATS inthisregard, soitseemed theCommittee should seekalternative
approaches. Forexample, itcould usedataonthescaleofthedomestic services market andsub-sector
markets tounderstand therelative importance ofexcluded sectors. Because thedataofdomestic markets
might indicate thepotential volume oftradeamong theparties toRTAs, hisdelegation wished toclarifyWT/REG/M/9
Page10
thelastsentence ofthefirstparagraph onpage4,amending ittoread: "Such domestic datawould
beuseful asanalternative because domestic markets should, inprinciple, beopentoother parties under
aregional trade agreement."
46. TherepresentativeofJapancontinued,sayingthatthesecondmainpointofthenon-paperentailed
theinterpretation of"and/or" withrespect totheelimination requirement andthestandstill requirement
ofGATS Article V:1(b). Hisdelegation attempted toclarify those tworequirements bydiscussing
three different cases. Theinterpretation should fullytakeintoaccount theobjective described by
paragraph 1(b), which wastheabsence orelimination ofsubstantially alldiscrimination. An
interpretation should notbetoonarrowly focused onthe"and/or" wording. Hisdelegation would like
theCommittee tocontinue interpretative discussions onGATS Article V:1andbroaden itsinterpretative
study totheother provisions ofArticle V,inparticular those ofparagraphs 4,6and7.
47. Therepresentative oftheUnited States requested anexplanation astowhytheexaminations
ofCEFTAandassociatedbilateralFTAshadbeendelayed.Hisdelegationhopedthatthoseexaminations
could berescheduled assoonaspossible andwould welcome theparties 'useoftheStandard Format.
48. TheCommittee tooknoteofallthecomments made.