WORLD TRADE
ORGANIZATIONG/SG/Q1/CHN/1
18 September 2002
(02-4970)
Committee on Safeguards Original:  English
NOTIFICATION OF LAWS AND REGULATIONS UNDER
ARTICLE 12.6 OF THE AGREEMENT
Questions Posed by the UNITED STATES
Regarding the Notification of the PEOPLE'S REPUBLIC OF CHINA1
The following communication, dated 13 September 2002, has been received from the
Permanent Mission of the United States.
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Questions to China from the United States in the context of the Transitional Review Mechanism
pursuant to Section 18 of the Protocol of Accession of the People's Republic of China
1. The United States thanks China for its recent notification of its new safeguard regulations.2
As referenced in its notification, China also implemented provisional rules regarding the notified
regulations which, to our knowledge, have not yet been notified to the Committee on Safeguards as
required by Article 12.6 of the Agreement on Safeguards (“SGA”).3  When does China intend to
notify these provisional rules?
2. Article 1 of the notified regulations specifies that they are “formulated in accordance with the
Foreign Trade Law of the People’s Republic of China…”.  Does “Foreign Trade Law” refer
exclusively to Law 19-586 Adopted 12 May 1994 by the Seventh Session of the Standing Committee
of the Eighth National People’s Congress?  If not, what other laws apply to the notified regulations?
3. Article 8 of the notified regulations identifies certain relevant factors that its competent
authorities shall examine in making the determination of injury.  Are the factors listed in Article 8 the
only factors that China’s competent authorities will examine in their injury determination?  How will
China’s competent authorities ensure that “ all relevant factors of an objective and quantifiable nature
having a bearing on the situation of [the] industry” are evaluated, as required by SGA Art. 4.2(a)?
Also, because Paragraph 4 of Article 8 requires the authority to examine other possible causes ofinjury, there is a clear relationship between this article and Article 11 of the notified regulations.
Shouldn’t Articles 8 and 11 of the notified regulations cross-reference one another to clarify this
relationship?
                                                     
1 G/SG/N/1/CHN/2
2 G/SG/N/1/CHN/2, 28 August 2002
3 “Provisional Rules for Placing a Case on File for Safeguards Investigation” and “Provisional Rules of
the People’s Republic of China for Hearings on Safeguards Investigations”, implemented by MOFTEC on13 March 2002 (the “Provisional Rules”).  Because these rules have not yet been formally notified to the WTO,
our questions concerning these provisional rules are based on an unofficial translation that we have obtained.G/SG/Q1/CHN/1
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4. Article 12 of the notified regulations provides opportunity for importers, exporters and other
interested parties to state their opinions and argume nts.  Procedures for implementing this provision
are described in the Provisional Rules of the People’s Republic of China for Hearings on Safeguards
Investigations .  With regard to these Rules ,
Please define the meaning of “other interested organization or person” as used in Article 7.
Article 17 states that the purpose of the hearing is to allow parties to state their positions and
submit supporting materials, but that “no debate shall be held.”  This last statement appears to conflict
with SGA Art. 3 which requires that parties be given “…the opportunity to respond to the
presentations of other parties.”  How does China propose to provide parties an opportunity to rebut
arguments raised by other parties, consistent with SGA Art. 3?
5. How will China implement the provisions specified in Article 13 of the notified regulations
regarding the treatment of confidential information and the provision of non-confidential summaries?
6. Under Article 14 of the notified regulations, does MOFTEC (or any other relevant competent
authority) intend to publish a report setting forth its findings and reasoned conclusions reached on all
pertinent issues of fact and law, as required by SGA Arts. 3.1 and 4.2(c)?
7. Will the “preliminary determination” referenced in Article 15 of the notified regulations and
the “final determination” referenced in Article 16 include the competent authority’s recommendation
for, or application of, relief, or will they only refer to an affirmative or negative determination as to an
increase in the quantity of the product in question and as to whether such increased imports cause or
threaten serious injury to the domestic industry?
8. Unlike Article 17 of the notified regulations referencing provisional measures, Article 20
states that “safeguard measures may take the forms of tariff increases or quantitative restriction, etc.”
Is there any clear recitation in Chinese law or regulation of all of the possible types of final safeguard
relief available for application by the competent authority(ies)?  Are raising tariffs and/or applying a
quota the only types of safeguard relief available under Chinese law and regulation?
9. Article 21 of the notified regulations indicates that if, in determining final safeguards relief,
MOFTEC decides to limit the quantity of imports , MOFTEC shall make and publicize that decision.
However, if MOFTEC “proposes” that the final safegu ards relief be increased tariffs rather than a
quota, this type of relief must be proposed by  MOFTEC to the State Council Tariff Commission,
which is charged with making the final determination of whether to impose higher tariffs.  The
Council’s decision is then publicized by MOFTEC.  On what basis do the competent authorities treat
these two types of relief differently?
What rules govern the final safeguard determinations by the State Council?  Are these rules
set forth in Chinese law or regulations?  If so, where?
Please answer these questions with respect to Article 30 of the notified regulations, as well.
10. Articles 22, 23 and 25 of the notified regulations refer to “regions” as well as “countries.”  By
“regions,” does China intend to encompass anything other than the term  “[WTO] Member(s)” as
used, e.g., in SGA Art. 5.2?  Please explain.
11. To ensure consistency with SGA Arts. 7, 8 and 12, the third condition in Article 27 of the
notified regulations should more clearly reflect conformity with the SGA’s multiple requirements
regarding the extension of a safeguard measure.  While the third condition listed in Article 27
confirms that “foreign-related” notification and consultation obligations must be fulfilled prior toG/SG/Q1/CHN/1
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extending a safeguards measure, the language is ambiguous with respect to exactly what is required of
the Member seeking the extension.  For example, consistent with SGA Art. 8.1, the Member must
endeavour to maintain a substantially equivalent level of concessions and other obligations to that
existing under GATT 1994.  Similarly, consistent with SGA Art. 12.3, the Member must provide
adequate opportunity for prior consultations with Members having a substantial interest as exporters
of the product concerned.  How does China intend to co mply fully with all of the requirements of the
SGA with respect to extending a safeguards measure in view of the ambiguous wording of this article
of the regulation?
12. Article 32 of the notified regulations, like Article 7 of China’s Law 19-586, states that if any
country or region discriminatorily applies safeguard measures against Chinese exports, the People’s
Republic of China may retaliate or, in the words of Article 32, take “corresponding measures.”  What,in China’s view, would constitute “discriminatorily apply[ing] safeguard measures?”  Based on what
authority in the SGA would Chinese authorities take such “corresponding” measures, and what sort of
measures would they take?
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