WORLD TRADE
ORGANIZATIONG/AG/N/PAN/2/Add.1
14 January 1999
(99-0097)
Committee on Agriculture Original:  Spanish
NOTIFICATION
Addendum
The delegation of Panama wishes to add the attached Resolution No. 2 to its notification
G/AG/N/PAN/2.G/AG/N/P AN/2/Add.1
Page 2
IMPORT LICENSING COMMISSION
Resolution No. 2 of 19 September 1997
The Quota Licensing Commission, in Exercise of its Legal Powers, Decides
To Approve the Following Regulations
Regulations Governing the Granting of Import Licences for Products
Subject to Tariff Quotas
CHAPTER I
General Provisions
Article 1. Products subject to quotas.  The provisions of these Regulations shall apply to the
products listed in Annex 1, provided that their import is subject to a tariff quota.
Article 2.  Definitions.Tariff quota:  The volume of a particular good that may enter Panamanian customs territory
upon payment of an import duty that is lower than the prevailing duty, administered through non-
automatic import licences which guarantee market access.
Commission:  The Quota Licensing Comm ission, established by Law No.  23 of
15 July 1997.
Offer to purchase:  Application by one or more buyers to purchase a product subject to a tariff
quota at a fixed price.  Offers to purchase shall be submitted on the day of the negotiation session for
a volume equivalent to one lot.
Offer to sell:  Application by one or more sellers to sell a product subject to a tariff quota at a
fixed price.  Offers to sell shall be submitted on the day of the negotiation session for a volumeequivalent to one lot.
Fulfilment of transaction agreements:  Implies the deposit of a bond and the fulfilment of the
terms laid down in the agreement for the transaction between the buyer and the seller.
Lot:  Units into which products subject to tariff quotas are divided in order to facilitate the
transaction and award of the licence.
Negotiation session:  Public bidding process supervised and regulated by the Commission at
which authorized buyers and sellers make offers to purchase or sell products subject to tariff quotas.
Random selection mechanism:  The Commission shall draw lots to select the offers to
purchase that will go forward to the negotiation session.  The Commission shall utilize this
mechanism when the total number of offers to pu rchase exceeds the amount of each lot or the total
amount of the quota.  During each draw, economic operators shall be given an opportunity to make anoffer to purchase for every quota lot to be negotiated.G/AG/N/P AN/2/Add.1
Page 3
CHAPTER II
Functions of the Quota Licensing Commission
Article 3.  Provisional administration.  Until the Product Exchanges set up under Law No. 23
of 15 July 1997 start to operate, the Commission shall make available to interested economicoperators the tariff quotas mentioned in Annex 1 using the physical facilities authorized by the
Commission.
Article 4.  Notification of the opening of quotas.  The Commission shall publicize the opening
of quotas widely before they are made available to the public.  The notification by the Commission of
the granting of non-automatic import licences for products subject to tariff quotas shall be published
in two (2) national newspapers, in three (3) editions  on different days over at least twenty-one (21)
calendar days before the date on which the corresponding negotiation session commences.  As a
minimum, the notification shall describe the product subject to the quota, indicate the total amount of
the quota, its division into lots, the date on which the quota will come into effect and the date of
expiry of the period for buying, selling or importing the product.
Article 5.  Periodicity.  Taking into account the characteristics of each product, the
Commission shall determine the periodicity with which tariff quotas shall be made available to
interested parties within the initial and final lim its fixed in Annex 1.  In each notification of the
opening of quotas, the Commission shall specify the number of lots into which the total quota shall be
divided.
In each case, the Commission shall also fix the maximum time-limit for effective import of
the products covered by the tariff quota and shall adopt the necessary measures to ensure that these
products are imported.
If a quota is not allocated, either fully or in part, during a specified period, the amount may be
added to the quota for the period immediately following.  This cumulation possibility shall apply to
periods within the same year and to no more than two periods.
CHAPTER III
Technical Secretariat of the Commission
Article 6.  Establishment.  The Technical Secretariat of the Quota Licensing Commission is
hereby established within the Trade Policy Office of the Ministry of Agricultural Development, as
provided in Law No. 23 of 15 July 1997.
Article 7.  Functions.  The Technical Secretariat shall have the following functions:
1. To assist the Quota Licensing Commission in preparing the notification of the
opening of tariff quotas;
2. to coordinate the registration of economic operators wishing to participate in
negotiation sessions for products subject to tariff quotas;
3. to receive, classify and publish offers to purchase and sell submitted by authorized
bidders;G/AG/N/P AN/2/Add.1
Page 4
4. to coordinate the negotiation session and assist the director of the session appointed
by the Commission;
5. to record the transaction agreements definitively concluded;
6. to receive the bonds put up by bidders;
7. to issue buyers with certificates identifying the bidders and the terms of the
negotiation under which the relevant tariff quota was allocated;
8. to carry out any other functions assigned to it by the Quota Licensing Commission in
accordance with Law 23 of 15 July 1997.
CHAPTER IV
Allocation of Tariff  Quotas
Article 8.  Allocation.  Non-automatic import licences for products subject to tariff quotas
made available to interested parties shall be granted to economic operators participating as buyers in
the agreed transactions registered by the Technica l Secretariat, in accordance with the provisions of
these Regulations.
Article 9.  Non-transferable nature.  After tariff quotas have been allocated, they shall not be
transferred and shall apply solely to the products included in Annex 1 and listed in writing in the
transaction agreement registered with the Commission.
CHAPTER V
Registration of Bidders and Receipt of Offers
Article 10.  Registration of bidders. Economic operators wishing to take part in negotiations
on products subject to tariff quotas in accordance with these Regulations shall register with the
Technical Secretariat at least five (5) working days prior to the date of the negotiation session.  The
Technical Secretariat may request bankers' certificates and trade references from bidders seekingregistration.
Article 11.  Applications.  Economic operators registered according to the terms of the
preceding Article and wishing to participate in the purchase or sale of products subject to tariff quotas
shall submit a preliminary application to the Technical Secretariat of the Commission.  Theseapplications shall be submitted at the latest five (5) working days prior to the negotiation session to
enable the Technical Secretariat of the Commission to make them available to all those participating
in the market.  For this purpose, the Technical Secretariat of the Commission shall make available to
bidders a special form to be used to transmit their initial applications for the purchase or sale of goods
to the Commission.  The form shall contain information on the buyer or seller concerned, the type ofproduct, its status, quantity and price.
Article 12.  Bulletin.  Two (2) working days prior to the date of the negotiation session, the
Technical Secretariat shall publish the various prices and quantities of the products based on the initial
applications submitted by bidders in a bulletin specially prepared for this purpose, in order to makethis information available to any economic operator wishing to purchase or sell the product. The
Technical Secretariat shall give each application submitted an identification number.G/AG/N/P AN/2/Add.1
Page 5
The applications shall be binding.  Nevertheless, before the negotiation process commences,
any party may modify its application and the Technical Secretariat of the Commission shall duly
make this known orally or in writing.
CHAPTER VI
Negotiation Process
Article 13.  Bonds.  At the time of the negoti ating session, the Commission shall require all
purchasers and sellers to deposit a bond amounting to 20 per cent of the price quoted for each offer to
purchase or sell submitted in accordance with Article 14 of these Regulations.  The bond shall be
deposited before the session commences and shall guarantee the seriousness of the proposals madeduring the negotiation session, the fulfilment of the transaction agreed, the import of the product
within the period fixed and the duties to be paid on its import.
Bonds must be deposited in cash, in credit instruments issued by the State, insurance
company bonds, bank guarantees, cheques or bankers' drafts.
Bonds shall be made out to the Commission and the Office of the Comptroller General of the
Republic and shall be deposited with the latter.
A buyer or seller who fails to fulfil the transaction agreement shall forfeit the bond, which
shall be credited to the National Treasury.
After the terms of the agreement have been met and if there is no liability, the bond shall be
cancelled.
Article 14.  Receipt of offers.  At the time of the negotiation session and for a period to be
determined by the Commission, bidders registered with the Technical Secretariat and having
deposited a bond in accordance with the preceeding Article shall submit to the director of the session
one or more offers to purchase or sell the amounts corresponding to a lot, and their acceptance shall
be subject to the public bidding process during the negotiation session.
Article 15.  Fixing reference prices.  The offers put forward by bidders shall be listed in order
to classify the offers by product and by lot corresponding to the lowest price.  The lowest equivalent
prices submitted by buyers and sellers shall be used as reference prices during the negotiation session.
Article 16.  Selection of offers.  After the period allowed for the receipt of offers, in
accordance with the preceeding Article, the director of the session shall classify the offers to purchaseor sell by-products.  Where the total offers to purchase represent a sum that exceeds the maximum
amount of the quotas, lots shall be drawn to determine which offers to purchase shall be considered at
the negotiation session.  When the offers to pur chase selected reach the maximum ceiling of the
quota, the other offers shall be rejected.
Article 17.  Classification of offers.  Where the total number of offers to purchase does not
exceed the quota, they shall be taken up during the negotiation session in the same order in which they
were submitted to the director of the session.
Where the total amount of offers to purchase exceeds the total amount of the quota, the
mechansim for drawing lots cited in the preceding Article shall be followed.G/AG/N/P AN/2/Add.1
Page 6
Article 18.  Negotiation session.  The negotiation session shall consist of a public bidding
process supervised by the director of the session appointed by the Commission.  At the session, the
offers to purchase shall be put before all the bidd ers in the order laid down in the preceding Article.
All offers to purchase selected in accordance with Article 16 of these Regulations shall be respected.
An auctioneer shall announce out loud the characteristics of each offer to purchase to be
negotiated, as well as the applicable reference price, and this information shall also appear on a screen
set up for this purpose.  Subsequently, he shall announce the opening of the bidding and rebidding
among sellers.  Bids shall be based on the reference price quoted for the product.  The transaction
shall conclude with the offer of the seller representing the lowest price.
When the first transaction has been concluded, the proceedings shall continue in the same
way until no more offers to purchase remain.
Article 19.  Final award of the contract.  When the public bidding process provided in the
preceding Article has ended, the contract for the tr ansaction shall be awarded to the buyer selected
and the seller proposing the best selling price.  When the contract for the transaction has beenawarded, the Commission's Technical Secretariat shall immediately register it and allocate the
corresponding tariff quota.
Transactions concluded during the bidding process shall be binding.  Each party involved in a
transaction awarded in final form may claim liability if the other party breaks the agreement and mayinitiate the relevant legal proceedings.
Article 20.  Fulfilment of the final transaction agreement.  It is understood, and shall be
agreed by the parties, that the final transaction agreement shall be fulfilled within a period not
exceeding seventy-two (72) hours from the close of the negotiation session.
Upon expiry of the period fixed in the preceding paragraph, parties affected in any way by
failure to fulfil the agreement may request the Commission to intervene in order to reallocate the
quotas concerned.
Article 21.  Certification.  After the agreement has been fulfilled in accordance with the
preceding Article, the Technical Secretariat shall is sue the buyer with a certificate, identifying the
bidders and the terms of the negotiation under which the relevant tariff quota has been allocated.
The certificate shall indicate the period during which the tariff quota may be used, in
conformity with the provisions of Article 5 of these Regulations.
Any buyer or seller, whether a natural or legal person, who has firmly committed himself to
such a transaction and subsequently breaks his contract without effecting the imports within the set
time-limit, failing to give satisfactory grounds, shall be barred from participating in the negotiation of
quotas either directly or through a third party for a period of two (2) years from the date of the
transaction.
The Commission shall be responsible for applying the measures cited in the preceding
paragraph, ensuring due process of the law for those affected.G/AG/N/P AN/2/Add.1
Page 7
CHAPTER VII
Negotiation of Raw Material Quotas
Article 22.  Regime applicable.  Subject to the restrictions indicated in this Chapter, the
provisions set out in the preceding Articles, shall apply to the negotiation of quotas declared by the
Commission to be raw materials.
Article 23.  Notification.  On the basis of Law 23 of 15 July 1997, the Commission shall
determine what percentage of a quota shall be allocated to raw materials, taking into account the
legislation in effect and the need for use of the product.  For this purpose, the Commission shall
announce its intention to open quotas constituting raw materials by means of the notification referredto in Article 4 of these Regulations.
Article 24.  Authorization.  In order to participat e in the negotiation sessions organized by the
Commission for products subject to tariff quotas and declared as raw materials on the basis of the
preceding Article, buyers must be economic operat ors who have provided the Directorate-General of
Industry of the Ministry of Trade and Industry with proof that they require the type and volume of the
product for which they are applying for a licence and possess the necessary operating capacity to
process it.
Article 25.  Determination of the level of participation.  Authorized buyers may submit an
application to purchase to the Technical Secretariat of the Commission, taking into account their
requirements and their operating capacity to process the type and volume of the product for which
they are seeking a licence.
Where the total number of purchase applications exceeds the amount allocated per lot or the
total amount of the quota, the Technical Secretariat and the Directorate-General of Industry of the
Ministry of Commerce and Industry shall determine the percentage and quantity of the level of
participation per lot to be given to each buyer in the quota to be allocated.
Article 26.  Publication.  All information concerning authorized buyers and the determination
of the level of participation shall be given in the bulletin published by the Technical Secretariat in
accordance with Article 12 of these Regulations.
These Regulations shall enter into effect upon publication in the Gaceta Oficial (Official
Bulletin).
Done in Panama City on the nineteenth day of September one thousand nine hundred and
ninety seven.
Carlos A. Sousa-Lennox M. Miguel Heras Castro
Minister for Agricultural Development Minister for Finance
Raul Arango Gasteazoro
Minister for Commerce and IndustryG/AG/N/P AN/2/Add.1
Page 8
ANNEX No. 1
Description of products
1Tariff item number
2
Meat of swine
- Carcasses
- Half-carcasses
- Hams, shoulders and cuts thereof, with bone in
- Shin, boneless or with bone in
-O t h e r- Carcasses
- Half-carcasses
- Hams, shoulders and cuts thereof, with bone in
- Chops, boneless or with bone in
-O t h e r- Hams, shoulders and cuts thereof, with bone in
-O t h e r
- Pork ribs
- Boneless hams
-O t h e r- In air-tight containers or vacuum-packed
- In air-tight containers or vacuum-packed
-O t h e r
- Hams in packings of a weight of more than 1 kg.
-O t h e r0203.11.10
0203.11.20
0203.12.00
0203.13.00
0203.19.000203.21.10
0203.21.20
0203.22.00
0203.23.00
0203.29.000210.11.10
0210.11.90
0210.19.10
0210.19.20
0210.19.901602.41.10
1602.42.10
1602.42.90
1602.49.13
1602.49.19
Meat of poultry
- Fowls of the species Gallus domesticus, except
breasts (cuts)
- Other cuts0207.39.11
0207.41.30
Dairy produce
- Of a fat content, by weight, not exceeding 1%
- Milk (liquid), in aseptic containers, long-life,
without refrigeration
-O t h e r
-O t h e r
- In containers of a capacity of not more than 1 kg.
(exclusively for household use)
-O t h e r
- In powder, granules or other solid forms, in
containers of a capacity of more than 1 kg., of a
fat content, by weight, not exceeding 1.5%
-O t h e r-O t h e r
- In powder, granules or other solid forms, of a fat
content, by weight, exceeding 1.5%
- Evaporated, of a fat content, by weight, not
exceeding 1.5%
- Evaporated, of a fat content, by weight, exceeding
1.5%
-O t h e r0401.10.00
0401.20.10
0401.20.90
0402.10.20
0402.10.91
0402.10.99
0403.90.22
0402.21.900402.29.90
0403.90.230402.91.910402.91.92
0402.91.99G/AG/N/P AN/2/Add.1
Page 9
Description of products
1Tariff item number
2
- Evaporated, of a fat content, by weight, not
exceeding 1.5%
- Evaporated, of a fat content, by weight, exceeding
1.5%
-O t h e r
- Curdled
- For industrial use, unseparated, in containers of
20 kg. or more0402.99.91
0402.99.92
0402.99.99
0403.90.13
0406.90.11
-O t h e r- In powder, granules or other solid forms, whether
or not containing added sugar or other sweetening
matter
-O t h e r
-O t h e r- Processed cheese, not grated or powdered0403.90.90
0404.90.10
0404.90.90
0406.10.900406.30.00
Potatoes
- Other 0701.90.00
Beans
- Beans (of the species Phaseolus) 0713.33.30
Maize (corn)
-O t h e r
- Other, sliced or kibbled
-O t h e r1005.90.90
1104.23.20
1104.23.90
Rice
-O t h e r
- Husked (brown) rice
- Semi-milled, whether or not polished
- Broken rice1006.10.90
1006.20.00
1006.30.00
1006.40.00
Tomatoes
- Purées
- Raw paste or pulp
-O t h e r2002.90.11
2002.90.12
2002.90.19
__________