WORLD TRADE  
ORGANIZATION  WT/REG148/5 
6 December 2004 
 
 (04-5358) 
Committee on Regional Trade Agreements Original:   English 
  
  
  FREE TRADE AGREEMENT BETWEEN  
THE EFTA STATES AND SINGAPORE 
 
Questions and Replies
 
 
 
 The following communication, dated 30 November 2004, is being circulated at the request of 
the Delegations of the EFTA States  (Iceland, Liech tenstein, Norway and Switzerland) and Singapore. 
  This document reproduces the questions addressed  to the Parties and the responses submitted. 
The questions and replies set out below are or ganized in accordance with document WT/REG148/3 
and WT/REG148/4.  
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GOODS ASPECTS
 
  
I. BACKGROUND INFORMATION ON THE AGREEMENT 
3. Scope  
 
1. Could the Parties explain the relationship between the Agreement and the bilateral 
agreements?  What are the reasons that they were not included under the cover of a single 
agreement? 
 The Agreement covers trade in industrial prod ucts, including fish and other marine products, 
and trade in processed agricultural products. The bila teral agreements cover trade in basic agricultural 
products only. The Agreement and the bilateral agreem ents form together the instruments establishing 
the free trade area between the EFTA States and Singa pore. The application of the Agreement and the 
bilateral agreements are interdependent on each other, si nce it is stated in the bilateral agreements that 
they shall enter into force at th e same time as the Agreement and re main in force as long as the Parties 
to it remain Parties to the Agreement. The bilate ral agreements also make reference to certain 
provisions in the Agreement, for example the pr ovisions on Dispute Settlement in the Agreement 
apply for the purposes of the bilateral agreem ents only between the Parties thereto. 
  The EFTA States do not have a common agricultural policy. They have different sensitivities when opening up their markets for basic agricultural products. The prac tise of covering trade in these 
products in separate agreements between each EFTA  State and Singapore gives each EFTA State the 
possibility of “tailor-made” soluti ons for providing substantial concessi ons and liberal origin rules, 
instead of having to settle for the lowest common denominator of all the EFTA States.   WT/REG148/5 
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4. Trade Data 
2. According to the Parties, 96 percent of tota l agricultural trade will enjoy duty-free 
treatment under the Free trade Agreement.  In ord er to further clarify the total coverage in the 
bilateral agricultural agreements, the EC is  interested in information on whether the 
elimination of tariffs for 96 percent of agricul tural trade would entail quota-free treatment as 
well.  The EC would also appreciate if the part ies could indicate, in general terms, how the 
coverage of historical trade compares with  coverage of tariff lines under the Agreement? 
 Under the Agreement 96 % of the total agricultu ral trade will enjoy duty free treatment. Most 
of the products concerned are not subject to tari ff quotas. In the bilateral agricultural agreement, 
Switzerland has granted concessions to Singapore fo r certain products (five tariff lines) which are 
subject to tariff quotas.  This is likely to have no or only a very limited effect on the percentage of 
total agricultural trade that enjoys duty-fr ee treatment under the Free Trade Agreement. 
  The Par ties have submitted, in the standa rd format for information (WT/REG148/3), a 
comprehensive overview of the trade coverage of  the Agreement and the bilateral agricultural 
agreements. The overview shows the total trade be tween the EFTA States and Singapore, and the 
proportion of trade that would enter duty-free, at  reduced duties and without concessions, listed for 
each chapter of the Harmonized System.   An overview of the bilateral trade in agricultu re will be established and distributed at a later 
stage.  
 
 
II. TRADE PROVISIONS 
5. Safeguards 3. Despite the high level of overall trade cov erage in the Agreement reported by the 
Parties, and given the limited bilateral trad e between the Parties, the Free Trade Agreement 
still provides for bilateral emergency measures.  The EC would thus appreciate if the Parties 
could explain why they perceive it to be neces sary to allow for the possibility of bilateral 
emergency measure.  
 The purpose of a free trade agreement is to liber alize trade between the parties concerned, and 
thus foster increased quantities of imports and e xports.  Full free trade from day one can, however, 
imply certain adaptation costs to particular segme nts of the domestic industry should there be an 
immediate and huge influx of imports.  While we generally believe that em ergency action should not 
be applied - or only to a very limited extent - in  the context of a free trade agreement, we have 
included a provision addressing such particular situati ons arising after the entry into force of the free 
trade agreement. 
 
 The "Bilateral emergency action clause" is limited to allowing a party to increase the rates to their current MFN rates or to the applied MFN rate  at the entry into force of this agreement, 
whichever is lesser, during a period of one year or in very exceptional cases up to three years and is subject to notification and close scrutiny in the Jo int Committee.  As such it is just a temporary 
postponement of the full liberalization provi ded for in Article 8 of the Agreement. 
 
 The Parties will meet in the Joint Committee af ter 2 years to discuss whether to continue or 
discontinue this provision. This discussion has not yet taken place.   The bilateral emergency action provision has never been applied. 
  WT/REG148/5 
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8. Sector-Specific Provisions 
 8.1 Agriculture 
 
4. Could the Parties explain the differences be tween the bilateral agricultural agreements 
with Singapore?  What coverage does each of these agreements have?  
 The main part of the agreement, Annex I (concessions granted by Singapore), and the main 
part of Annex III (Rules of origin, general rules)  are identical in the three agreements. Annex II 
(concessions granted by the respective EFTA State) and the Appendix to Annex III (Rules of origin, 
list rules) are different. Therefore, the differences in  the agreements consist firstly in the coverage of 
products for which each of the EFTA States grants  concessions, and secondly in the working or 
processing that products, which are not wholly obtai ned, must undergo in order to be considered 
originating.    Under the three bilateral agreements, Singa pore grants duty-free treatment for all basic 
agricultural products originating in the EFTA States.  The coverage of concessions granted by each of 
the EFTA States to Singapore is different in the th ree agreements. Annex II to each of the agreements 
lists the products that are subject to preferential treatment.   
SERVICES ASPECTS
 
 
 
I. BACKGROUND INFORMATION ON THE AGREEMENT 
3. Scope 5. Singapore has liberalized trade in services with EFTA countries on the basis of a 
positive list of commitments.  Liberalisation of trade in services between Singapore and 
Australia (SAFTA) is based on negative lists of commitments.  Given the differences between 
the two Agreements, the EC would like to ask to what extent Singapore’s commitments under 
the Singapore-EFTA Free Trade Agreement go further than its commitments under the SAFTA and what extent commitments under the latt er go further than commitments under EFTA-
Singapore. 
 It would be difficult to provide a precise analysis of the extent to which the commitments 
under SAFTA go further than commitments under the ESFTA, or vice versa.  This is due to the 
fundamental difference in the way that the commitments are scheduled in the 2 FTAs.  As a general 
observation however, the negative list approach woul d, prima facie, cover more sectors as it starts 
from the premise that all sectors are liberalized unl ess otherwise reserved.  In any event, under both 
FTAs, Singapore has made GATS-plus commitments and has not, a priori, excluded any sector. 
  
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