. /.  WORLD TRADE  
ORGANIZATION  TN/RL/W/165 
8 October 2004 
 
 (04-4222) 
Negotiating Group on Rules Original:   English 
  
 
SUBMISSION ON REGIONAL TRADE AGREEMENTS 
 
Paper by Japan
 
  
 The following submission, dated 24 September 2004, is being circulated at the request of the 
Delegation of Japan.  
_______________ 
  
JAPAN'S COMMENTS ON THE ACP PAPER TN/RL/W/155 
  
I. GENERAL 
 The Doha Ministerial Declaration clearly stat es that our negotiations shall take into account 
the developmental aspects of regional trade agreements. Fully in line with this Declaration, Japan is 
cognizant of the importance developmen t dimensions hold in the current round. In order for us to have 
productive and efficient use of our negotiation time in addressing the development dimensions, it only 
makes sense that we clarify and improve di sciplines and procedures under the existing WTO 
provisions applying to regional trade agreements, as mandated by the Doha Ministerial Declaration, 
before  plunging into discussions on Special and Differential (S&D) treatment elements.
1 
  In other words, the benefit of consideri ng the developmental aspects of regional trade 
agreements would improve if we first advance our discussion on subs tantive issues. In paragraph 10 
of the ACP paper, ACP members suggest that “Members agree that S&D treatment for developing 
countries be formally and explicitly made available to developing countries in meeting criteria set out 
in paragraphs 5 to 8 of GATT Article XXIV in th e context of regional agreements entered into 
between developing and developed countries.”  We duly note the political message of the ACP 
members contained in these paragraphs.  However, we believe that the time is not yet ripe to engage 
in any discipline-specific discussions because we have  yet to see the result of the work done in the 
Rules Negotiation Group for clarification of disciplines, e.g., on Article XXIV of GATT. 
 
 
II. COMMENTS ON SUBSTANTIVE ELEMENTS CONTAINED IN THE PAPER 
 
1. “Appropriate Flexibility” 
 At the Rules Negotiation meeting on RTA on June 29, one delegation stated that 
“substantially all the trade" requirement should ha ve the least amount of flexibility because it is an 
                                                     
 
1 In principle, when Japan negotiates RTAs with ot her countries, we consider those negotiating parties 
to be on equal footing, and there is little room for S&D treatment. TN/RL/W/165 
Page 2  
 
 exception to the general rule of the Most Favoured Nation treatment. Another delegation stated that it 
may be difficult for the Members who are currently engaged in the RTA negotiations to state their 
position in the discussion of the “substantially all the trade" requirement. The ACP paper stresses the 
need for “appropriate flexibility” for the "substantia lly all the trade" requirement (paragraph 11). It 
stands to reason, however, that in order for Memb ers to engage in the discussion on “substantially all 
trade” and “appropriate flexibility” in any concre te manner, it is imperative that the reporting 
requirement should be more rigorously enforced so as to enable Members to grasp the full range of 
trade that takes place under RTAs among the WTO Members.    2. 18 Years for Transitional Period 
 We have already requested the ACP members fo r a response as to why 18 years is necessary, 
or even should be regarded as “indicative” for the transitional period. We are looking forward to 
further elaboration by the ACP on this point.  3. Notification 
 We would like to seek a clarification for the meaning of “streamlined, efficient and less 
onerous transparency and examination procedures” in  paragraph 11 of the AC P paper. We consider 
that the notification should be done with maximum transparency regardless of whether the notifying 
Member is a developed or a developing country.  4. Dispute Settlement Implications 
 We would like to seek further clarification on the proposal related to the DSU. The DSU 
already contains a number of provisions incorpora ting S&D treatments (eg. Article 3.12, Article 4.10, 
Article 8.10, Article 12.10, Article 21.7, Article 21.8,  Article 24, and Article 27.2). By virtue of the 
very nature of DSU being applicable not only to disputes between deve loped and developing 
Members, but also to those involving only developi ng Members, we need to exercise extreme caution 
when considering S&D treatments be yond the provisions currently in place. Furthermore, Article 1 of 
the DSU explicitly states that the rules and procedures of this Understanding shall apply to disputes 
brought pursuant to the consultation and dispute settle ment provisions of the agreements listed in 
Appendix 1 to the Understanding . In this light, Japan cannot accept any proposal that would 
compromise the rights Members are entitled to under th is provision. Is this proposal intended to create 
special or additional rules and procedures akin to those listed in Appendix 2? If this is the case, we 
believe that we must first address the clarification and improvement of the procedures and disciplines 
under the existing WTO provisions applying to regional trade agreements.  5. RTAs under Enabling Clause 
 Regarding the RTAs under the Enabling Clause, Jap an believes that the parameters for tariff 
preferences under these RTAs should be well defi ned and targeted, and should not be outside the 
rules-based system, as was noted during the Ru les Negotiation meeting on 29 June, 2004.   
   
__________