WORLD TRADE  
ORGANIZATION  RESTRICTED  
 G/C/M/74  
16 July 2004  
 (04-3057 ) 
  Council for Trade in Goods   
 
 
 
MINUTES OF THE MEETING OF THE COUNCIL FOR TRADE IN GOODS  
5 JULY  2004  
 
Chairman:  H.E. Ambassador  Chiaradia  (Argentina ) 
 
 
 The meeting of the Coun cil for Trade in Goods , convene d by airgram WTO/AIR/ 2352 , 
proceeded on the basis of the proposed agenda contained in document G/C/W/ 491. 
 
I. REVIEW OF THE OPERATION OF THE TRIMS AGREEMENT UNDER 
ARTIC LE 9 ................................ ................................ ................................ ...............................  1 
II. REGIONAL TRADE AGREEMENTS  ................................ ................................ ..................  4 
A. FREE  TRADE  AGREEMENT  BETWEEN  THE  REPUBLIC  OF KOREA  AND  
CHILE  – NOTIFICATION  FROM  THE PARTI ES (WT/REG169/N/1,  
WT/REG169/1)  ................................ ................................ ................................ ...........................  4 
B. ENLARGEMENT  OF THE  EUROPEAN  UNION  – NOTIFICATION  FROM  THE  
EUROPEAN  COMMUNITIES  (WT/REG170/N/1)  ................................ ................................ .. 4 
III. STATUS OF NOTIFICATIONS UNDER THE PROVISIONS OF THE 
AGREEMENTS IN ANNEX 1A OF THE WTO AGREEMENT 
(G/L/223/REV.11)  ................................ ................................ ................................ .....................  5 
IV. OTHER BUSINESS  ................................ ................................ ................................ ..................  6 
A. REQUEST BY PAKISTAN FOR EXTENSION OF THE TRANSITION PERIOD UNDER THE 
TRIM S AGREEMENT  ................................ ................................ ................................ ...................  6 
B. STATEMENT BY ECUADOR  ................................ ................................ ................................ ..........  7 
 
 
I. REVIEW OF THE OPERATION OF TH E TRI MS AGREEMENT UNDER 
ARTICLE  9 
 
The Chairman  said t he first item on the agenda concern ed the review mandated under 
Article  9 of the TRIMs Agreement.  He noted  that there had been a recent  communication from India 
and Brazil which was a joint proposal on a study on the effect of the elimination of TRIMs , contained 
in document Job(04)/93 dated 1 July 2004.   He asked the  authors of the proposal to introduce it.   
 
 The representative of  Brazil  recalled that i n June 2003, the delegation of Colombia  had 
introduced  the possibility of having an additional study or technical note based on the notifications 
presented so far  in the WTO  related to TRIMS.  That study would evaluate  how such notified TRIMS 
might have impacted world trade and development.  Following on from the Colombian suggestion, 
the delegations of Brazil and India would like to offer a few preliminary ideas on elements that could 
be taken up by such a study.  The objective of the proposed study would be to work on notifications G/C/M/74  
Page 2 
 
 
 made since 1995 to assess  the development impact of the respective measures and of their 
elimination.  The bulk of notifications were related to the automotive and agro -food industries, hence 
particular attention should  be paid to these two industries.  In document Job(04)/93, wit h respect to  
item 3 he suggest ed as a basic list some of the questions that could be taken up by such a study.  For 
instance, it could evaluate what industries and activities were mainly affected by TRIMS .  To w hat 
extent did the TRIMS help advance targete d objectives ?  To what extent ha d the removal of local 
content requirements affected the level of local sourcing vis -à-vis  imports ?  The study could also  
assess if the removal of TRIMS affected the host country's ability to track FDI in the relevant 
indus try.  To what extent ha d the elimination of TRIMS be en affected by other trade policies , e.g.  the 
level of import tariffs and preferential rules of origin ?  The study could also  assess how the effects 
differ ed among Members  and if they differed  between exp ort-oriented and domestic market -oriented 
production .  Finally, what ha d been the response from the private sector, local and foreign owne d?  
This constituted  a list of issues which could be taken up in or der to re energise the Article 9 review .  
 
 The repr esentative of India  supported the intervention made by Brazil and said that the 
purpose of the proposed study would be to assess the trade and development impact of the TRIMs and 
of their elimination.  He believed that such a study could provide additional  inputs to inform the 
debate as well as help Members understand trade and development aspects of TRIMs.  This did not 
preclude any additional input by way of Members sharing their own experience with the operation of 
TRIMs.  He reminded Members of the subs tantive paper jointly submitted by Brazil and India in 
October 2002, putting some concrete ideas that could be addressed in the course of the TRIMs review.  
He urged Members to reflect further on the new paper and urged the Chairman to explore further 
these ideas with Members through informal consultations.  His delegation would be happy to 
participate in such consultations and to discuss possible terms of reference of such a study with other 
Members.  He was sure that with a constructive spirit the Council  would be able to have a structured 
work programme for discussion under this agenda item.  
 
 The representative of Colombia  recalled that her delegation had previously  pointed out that 
the review  of the TRIM s Agreement represented  an opportunity to assess t he impact of TRIM s 
measures on trade and development as well as  the effects of the ir elimination .  The analysis of the 
notifications presented since the Uruguay Round w ould provide factual elements which w ould show 
what the effects of  TRIMs  had been on eco nomic development.  The terms of reference were 
appropriate to fulfil the objective which ha d been proposed .  Whilst the measures would  focus on the 
automotive and agro -industrial sectors, she repeat ed he r preference for a hor izontal coverage of the 
study.  
  
 The representative of the United States  said he would transmit the paper  back to capital for a 
more formal reaction, but as an  initial reaction, he thought that the purpose of th e document was to 
serve as a basis for what might be a concrete revision o f the TRIM s Agreement .  This went far beyond 
what he thought the mandate of the Article 9 review was.  He did not think this kind of study would 
command the support of all the Members of the WTO.  
 
 The representative of the European Communities  said that t he studies Members had seen  to 
date ha d been useful , but it was unlikely that the  question of whether one was  looking at the operation 
of the Agreement or the revision of the Agreement would be resolved in the CTG.  She would send 
the proposal to Brussels and have possibly further comments at the next meeting.  
 
 The representative of Canada  was not  sure that this kind of study w ould add value given the 
substantial differences in relation to the issue of the Article 9 review.  His delegation was  open to the 
possibility of sharing national country experiences  as a possible way forward , but the appropriate 
place to do so would be in the TRIMs  Committee and not the CTG.  
  G/C/M/74  
 Page 3 
 
 
  The representative of Argentina  said that A rticle 9 of the TRIMs Agreement wa s very clear :  
it was to  review the function of the Agreement and propose changes to the text if necessary.  There 
were  two stages in this task  – the study stage and the assessment stage.  The CTG was still in  the 
review or study stage and there  had been  some very usefu l documents which had been submitted for 
review , e.g. th e joint study by UNCTAD and WTO and also the joint communication by  India and 
Brazil .  It was always good to have additional studies or additional communications to carry out th e 
review in an informed  and rational way .  Therefore Argentina found useful the initiative taken by 
Brazil and India with this latest proposal .  His delegation was  in favour of a new study with the terms 
of reference suggested by India and Brazil .  The questions in section 3 were important, in particular 
the question relating to what extent  did TRIM s help t o advance targeted objectives.  
 
 The representative of Cuba  support ed the proposal which would be useful for all Members 
because it would help them to reach a conclusion as to whether or not the Agreement should be 
amended.  
 
 The representative of Kenya  supported  Brazil and India and their joint proposal for a study on 
the effects of the elimination of TRIM s.  His delegation had  looked at the questions that the study 
would addre ss and concur red that it would address some of the issues that Kenya had previously 
raised such as  how the elimination of the TRIM s had been inconsistent with the development 
strategies for some countries .  Furthermore, he was reassured that Brazil had pointed out that this was 
only an illustration of the likely question s that this study would address.  He also shared the view of 
Colombia that the coverage should not be limited but should be more comprehensive . 
 
 The representative of Brazil  thanked Members  for their comments on the proposal, and said 
that the approach proposed by Colombia and Kenya to expand the scope of the study  would not pose 
major difficulties .  Like Argentina, his reading of the mandate  was quite clear  and he doubted  whether 
Brazil and  the United States shared  the same view.  The article certainly allowed  for a review of the 
operation of the Agreement, as well as the proposal of amendments to this Agreement.  With this 
document Brazil was  not suggesting any amendment s, but was trying to  find some concrete basis 
upon which to discuss the revision of th e Agreement .  It was  strange that Members would deny the 
opportunity of this Council to evaluate and assess the scope for revision of the A greement based on 
facts.   His comments were support ed by the representative of India.  
 
 The representative of Pakistan  endorsed the comments of Brazil and India as well as of those 
delegations that had supported the  proposal .  The proposal was for a study only  and would only be a 
preamble to what Members d id in future negotiations , and without prejudging the outcome of future 
negotiations he support ed the idea of the study and urge d Members to look at it with an open mind 
and once they g ot some response from the ir capital s.  
 
 The Chairman  said that regardi ng the proposal for a study, Members had expressed different 
views but generally favoured sending the text to their capitals for analysis and reflection.  It was clear 
that more time would be needed  to examine the proposal.  He therefore propose d that the Council take 
note of the statements made and agree to revert to this item, and to the question of the proposed study, 
at its next meeting.  
 
 It was so agreed . 
 
  G/C/M/74  
Page 4 
 
 
 II. REGIONAL TRADE AGREEMENTS  
A. FREE  TRADE  AGREEMENT  BETWEEN  THE  REPUBLIC  OF KOREA  AND  CHILE  – 
NOTIF ICATION  FROM  THE PARTIES  (WT/REG169/N/1,  WT/REG169/1)  
B. ENLARGEMENT  OF THE  EUROPEAN  UNION  – NOTIFICATION  FROM  THE  
EUROPEAN  COMMUNITIES  (WT/REG170/N/1)  
 
 The Chairman  drew Members' attention to the two Agreements listed under this item that ha d 
been notified under GATT Article XXIV.  The texts of the Agreements and their notifications ha d 
been circulated in the documents listed.    Regarding the  FTA between Korea and Chile , there were no 
comments.  
 
 Regarding  the enlargement of the European Union , the represent ative of the United States  
said that the US had presented its claims of interest to the EC and the new EU member States in April 
and had yet to receive a formal response to these claims.  In addition, the EC still had not yet provided 
complete data necessa ry for the compensation negotiations to proceed.  In particular, the notified tariff 
and trade data did not include the bound in - and out -of-quota tariff rates for tariff lines where either 
the EU or the acceding countries had a tariff rate quota, nor had the EU notified any new 
contemplated tariff rate quota allowance after the EU expanded on 1 May 2004.  His delegation 
requested that the EC provide this information relating to bound rates and proposed post -enlargement 
tariff rate quota volumes as soon as possible.  It was of concern that two months had elapsed since the 
1 May enlargement and the EC still had not engaged interested Members in earnest on Article XXVIII 
negotiations pertaining to EU enlargement.  Further, it was of concern that interested Mem bers still 
did not know their market access in the expanded EU for goods covered by tariff rate quotas.  The US 
requested that the EC finalise their internal analysis to allow the prompt continuation of bilateral 
consultations and negotiations and provide clarifications concerning the above questions.  
 
 The representative of Japan  also share d the  concern that the responses from the EC were  yet 
to come .  Japan wished to conclude th e negotiation as quickly as possible, but  only after f irst 
receiving  the neces sary data from the EC.  
 
 The representative of Canada  also u rged the EU to submit the information to Members as 
soon as possible  in order to  allow Canada  to finally complete the analysis for the Article  XXVIII  
negotiations which ha d already been significan tly delayed.  
 
 The representative of Thailand  said that her delegation was  waiting for the reply of the EC , 
and since the enlargement was already in effect since May, they were also  interested to know whether 
the EC ha d some kind of transition measure for Member s waiting for compensation.  
 
 The representative of Australia  shared the concerns expressed  by the US, Japan, Canada and 
Thailand.  Australia ha d presented its claims of interest in respect of the EU enlargement  and the EU 
had not provided complete i nformation to enable the process to go forward .  Australia urged  the EU to 
provide this information as soon as possible.   On a matter not directly related to Article XXVIII, but 
related to the EU schedule was the question of agricultural domestic support a nd export subsidies and 
his delegation  would appreciate information being provided on this matter as well as soon as possible.  
 
 The representative of Brazil  regretted that his delegation was  still lacking a great deal of 
information from the EC.  Brazil h ad already presented a preliminary list of claims, later 
complemented by a comprehensive second list , but the lack of information still hamper ed his 
delegation' s ability to assess the impact of the enlargement .  Brazil had  asked the EC for further 
informat ion on the ad v alorem equivalent of the data they submitted and also asked for more detailed  G/C/M/74  
 Page 5 
 
 
 information on the in -quota and out -of-quota volumes , as well as  tariff rates , but was still awaiting 
that information . 
  
 The representative of Chinese Taipei  shared the concern  of previous speakers, and urged the 
EC to provide  the data as soon as possible.  
 
 The representative of New Zealand  had submitted its claim of interest data but had  yet to 
receive a reply, including on any transitional measures that the EC expect ed to put in place to 
compensate those who ha d seen trade affected since May.  He  urged  the E C to provide the 
information , including on tariff quota rates and volumes as soon as possible so New Zealand could 
commence the negotiations.  
 
 The represen tative of Pakistan  urged the EC to provide the data which was being demanded 
by the Membership as a whole as soon as possible so that Members could  enter into meaningful 
negotiations.   This view was supported by the representatives of Ecuador and Argentina . 
 
 The representative of the European Communities  said she had taken note of  the comments 
made in relation to Article XXVIII  and would  relay them to Brussels.  
 
 The Chairman  proposed that the Council take n ote of the statements made and recommend 
that the Committee on Regional Trade Agreements carry out the examination of the above -quoted two 
Agreements in accordance with the following terms of reference:  
 
"to examine, in light of the relevant provisions of the GATT 1994, the Free Trade Agreement 
between t he Republic of Korea and Chile, and the Enlargement of the European Union, and to 
submit a report to the Council for Trade in Goods.  It is understood that the understanding 
read out by the Chairman of the Council for Trade in Goods under Item 7 of the age nda of the 
meeting of the Council for Trade in Goods on 20 February 1995, as contained in document 
WT/REG3/1, will apply mutatis mutandis to the examination of the agreements.  It is also 
understood that, during the examination, due account will be taken o f the intrinsic differences 
between customs unions and free trade areas."  
 
 It was so agreed . 
 
 
III. STATUS OF NOTIFICATIONS UNDER THE PROVISIONS OF THE 
AGREEMENTS IN ANNEX 1A OF THE WTO AGREEMENT (G/L/223/REV.11)  
 
The Chairman  said that t he latest revision of the listing of relevant notification obligations 
was contained in document G/L/223/Rev.11.  It include d all notifications of a regular or periodic 
nature up to 30 December 2003.  This revision incorporate d the technical changes to the document 
which were c irculated to Members for comment on 27 April 2004.  As the former CTG Chairman had 
noted, the suggested changes were of a technical nature, intended to take account of developments 
that had occurred since the notifications document was first circulated.   He recall ed that Ambassador 
Hovorka proposed at the time a time -period in which Members could submit comments on the 
proposed changes.  That time -period expired on 21 May 2004, and he understoo d from the Secretariat 
that no comments regarding the amendments  were forthcoming.  The former Chairman suggested that 
it would be reasonable to assume that Members may therefore be deemed to have approved the 
document, and that this approval could be formalised at this meeting.   Another question that was 
raised by the  previous Chairman concern ed the frequency of the document.  According to former 
practice, the update was circulated semi -annually.  From his consultations, Ambassador Hovorka 
informed him that in the view of several Members, the document might appear once  rather than twice 
a year.  Members were also invited to indicate by the 21  May date whether they could agree to an G/C/M/74  
Page 6 
 
 
 annual, rather than a semi -annual, circulation of the document.   As he had  heard nothing to the 
contrary, he assume d that the document would  appear once a year from now on.   The Council 
approved the changes to the document on an ad referendum basis, pending final approval by the 
United States delegation.  
 
 The representative of China  drew attention to the following:  on page 44, on customs 
valuation, a couple of entries were left blank for China , although  China ha d already made two 
notifications on 25 February 2004, and the document number was G/VAL/ N/3/CHN/1.  He hope d that 
this would  be reflected in the next update.   On page 60 on QRs, entrie s for 1996 -2001 were left blank 
with regard to China.  This was the period before China's accession and he believe d it was not China's  
obligation to make notifications, even though China  might feel free to do so.  In this situation, the 
entry "N/A" was mor e accurate.   The Chairman  said that the document would be updated in line with 
China's comments.  
 
 The representative of Australia  took note of China's statement in respect of the leaving of 
blank notifications during its pre -accession period.  He had  no problem with the position presented by 
China, that is that it d id not have these obligations as a Member.  However he wanted  to make  known 
that a number of acceding countries ha d sought to make notifications within required formats as part 
of their accessi on process , to engender confidence among the Membership that they were indeed 
getting ready for accession .  He hoped that  they would continue to do so in the future.  This was of 
course without prejudice to the need to record notification obligations of Me mbers.  Hence his 
delegation did  not object to China's request but simply want ed to make known the desirability of 
acceding countries to notify their policies before accession within the context of their accession 
working parties.  
 
 The Council took note  of the statements made.  
 
 
IV. OTHER BUSINESS  
A. REQUEST BY PAKISTAN FOR EXTENSION OF THE TRANSITION PERIOD UNDER THE TRIM S 
AGREEMENT  
The Chairman  inform ed Members  on the current status of the request for extension of the 
transition period under the TRIMs Agreement  submitted by Pakistan at the end of last year and 
circulated in document G/C/W/478.  Subsequently, a communication containing questions on 
Pakistan's request was received from the United States (document G/C/W/480).  The replies from 
Pakistan were distrib uted in document G/C/W/487, dated 16  April  2004.   On the basis of this 
additional information, his predecessor in the Chair, Ambassador Hovorka, convened a first round of 
informal consultations on Pakistan's request with a number of interested delegations.   It was clear that 
Members needed more time to analyse the information and that consultations should be pu rsued to 
consider the request.  The Chairman was  prepared to take over the process of consultations as and 
when delegations were ready to engage.  He would  then report back to the  Council at the appropriate 
time.  
 
The representative of the United States  thank ed Pakistan for the information provided.  The 
documents were under review in capital and shortly his delegation would  get back to Pakistan via th e 
Secretariat with comments and perhaps a further round of consultations would be appropriate at that 
point.  
 
The representative of Pakistan  said that i n the last informal consultations that were held, his 
delegation was  encouraged by the responses it received, and w as willing to engage as soon as 
Members ha d gone through the document and were willin g to consult .  G/C/M/74  
 Page 7 
 
 
 B. STATEMENT BY ECUADOR  
The representative of Ecuador  said that a t the last meeting of this Council on 27 April 2004, 
Ecuador had posed a number of q uestions to the European Communities regarding Commission 
Regulation  (EC) No.  414/2004 .  These questions were circulated to Members in document 
G/C/W/486 and relate d to the specific measures for adapting the European tariff -quota regime for 
banana imports as a result of the accession to the European Union of ten new Member States on  
1 May 2004.  Furthermore, several days prior to the above -mentioned meeting, these same questions 
were submitted directly to the European Communities in Brussels by the Mission of Ecuador in that 
city and also sent by his delegation to the Mission of the European Communities in Geneva.  In spite 
of the fact that some two months ha d passed since these questions were submitted, Ecuador ha d still 
not received a reply.  Similarly, an d also approximately two months ago, Ecuador had submitted a 
series of questions on th e same issue to the European Communities in the Council for Trade in 
Services, questions which to date ha d also remained unanswered.  According to his delegation, 
represe ntatives of member States of the European Communities ha d stated that there was the greatest 
willingness to reply to Ecuador 's questions.  H e therefore urge d the European Communities to clarify 
their concerns.  Without detriment to the submission by the Eu ropean Communities of replies directly 
to his delegation and for the purposes of transparency, he requested  that the replies be submitted in 
writing at the next meeting of th e Council with a view to their being subsequently circulated as an 
official WTO do cument for the benefit of all Members, given the system ic implications involved.  
 
The representative of the European Communities  noted  that consultations were ongoing in 
Brussels concerning the matters alluded to by Ecuador.  She would  relay the concerns to Brussels and 
try to see what can be done to speed up the process.  
  
 The Chairman  said that t he next meeting of the CTG was scheduled for 
Friday,  1 October  2004.  The agenda for the meeting w ould close on Monday, 20 September 2004.  
 
__________