. /.RESTRICTEDWORLD TRADE
ORGANIZATIONWT/REG109/M/2
18 March 2002
(02-1406)
Committee on Regional Trade Agreements
Thirty-First Session
EXAMINATION OF THE FREE TRADE AGREEMENT
BETWEEN THE EUROPEAN COMMUNITIES AND MEXICO
Note on the Meeting of 19 February 2002
Chairman:  Mr. A.J. Dumont (Argentina)
1. The meeting was convened in document WTO/AIR/1714.
2. Under Agenda Item C.IV of its Thirty-First Session, the Committee on Regional Trade
Agreements (CRTA) took up the examination of the Free Trade Agreement (Agreement) between the
European Communities (EC) and Mexico.
3. The Chairman noted that this was the second round of examination of the Agreement between
the EC and Mexico.  The proceedings of the first round, which had taken place in September 2001,
had been distributed in document WT/REG109/M/1.  He drew the Committee's attention to the recent
exchange of questions and replies which had been distributed as document WT/REG109/4.
4. The representative of the European Communities said that, although he could give
preliminary answers to some of the written questi ons recently submitted by the delegation of the
United States, more detailed attention would be required for others.  He added that the first round of
examination had enabled the Parties to provide a considerable amount of information on the nature
and content of the Agreement, and he invited the Committee to refer to the minutes in document
WT/REG109/M/1.  He added that the Parties were still preparing the trade data requested by the
Canadian and Australian representatives.  He had some preliminary estimates of the amount of trade
falling within Category V of the Agreement, which dealt with tariff elimination schedules, but the
information was not yet in a form to be put before  the Committee. He indicated that such information
might also answer some of the questions recently posed by the delegation of the United States with
regard to Scope.
5. Turning to Coverage, the representative of  the European Communities noted that the
Agreement covered all products, and that the prohibition of quantitative restrictions in the trade
between the Parties also covered all products.  At the same time, he acknowledged that trade
liberalization in terms of tariff elimination was not 100 per cent.  He explained that the tariff treatment
of individual products was set out in the specific schedules of the respective Parties.  With regard to
import restrictions, he was doubtful whether it was viable to compile a full list of non-tariff import
measures that applied to third countries:  he asked the United States representative to clarify herquestion to make sure he could answer her specific concerns.  The representative of the United States
acknowledged the difficulty in compiling such a li st and explained that she was interested in the
difference between non-tariff import measures eliminated between the Parties versus those faced by
third countries.
6. The representative of Korea noted that Annexes IV and V to the Agreement provided for two
types of non-tariff measures: Annex IV related to the prohibition of quantitative restrictions; andWT/REG109/M/2
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Annex V to national treatment.  He asked for explanations on which kind of measure would be used in
the case of quantitative restrictions and for which products; likewise for the provisions on national
treatment.  He also asked for statistical information related to these products, if available.  The
representative of Mexico asked the representative of Korea to submit his question in writing.
7. Turning to a question by the United States representative on the elimination of customs duties
on agricultural products, the representative of the European Communities said that the products listed
in Categories 5 and "O" of Annex I, which the Parties considered as sensitive products, had beenexcluded from tariff concessions, as a result of negotiations between the Parties.  Few RTAs provided
for 100 per cent coverage, nor was there any legal requirement under GATT Article XXIV to do so.
The degree of coverage and liberalization, as well as the speed of liberalization, simply reflected the
results of the negotiation between the Parties.  Referring to the question by the United States
representative on bilateral cumulation in the Agreement, he explained that although bilateralcumulation had been provided for, it did not amount to an extension to Mexico of the Pan-European
cumulation system.  He suggested that the question on the interface between the rules of origin under
the Agreement and those applying to Mexico's agreements with other preferential partners, including
the NAFTA, could be better answered by the representative of Mexico.  He sought clarification of the
question by the United States representative on standards, since from the way it had been drafted itimplied that the EC was itself a third party to the EC-Mexico Agreement, which was clearly not
possible.  He informed the Committee that the EC and Mexico did not have a mutual recognition
agreement on conformity assessment.  Turning to safeguards, he confirmed that to date, no safeguard
measure had been implemented between the Parties.  The representative of the United States agreed to
reformulate her delegation's question on standards.
8. The representative of the European Communities sought clarification from the United States
representative on the written question recently posed concerning the obligation of a party under
Article XVII of the GATT, dealing with state trading enterprises, as well as to its relevance to the
examination of the Agreement in the CRTA.  In relation to trade in goods, he said that the Agreement
being examined did not distinguish between goods pr oduced by a state trading enterprise or by a
private body.  Annex XV of the Agreement included a cooperation mechanism on competition policy,
and although that might have relevance to the operation of state trading enterprises or monopolies, he
clarified that it was not specifically limited to that.  He wondered whether the aim of the United States
question was to discuss the respective notifications made either by the EC or by Mexico in the context
of Article XVII.  If so, in his delegation's opinion, the CRTA was not the relevant place for that, and
the issue would have to be taken up in another body of the WTO.
9. The Chairman noted that the second round of examination of the Free Trade Agreement
between the European Communities and Mexico had allowed the Committee to clarify a number of
questions, although others were still pending.  He invited those delegations wishing to ask additional
questions to forward them in writing to the Secret ariat by 15 March, and the Parties to submit their
replies in writing as soon as possible and no later than 30 April.
10. The Committee took note of the comments made.
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