RESTRICTEDWORLD TRADE
ORGANIZATIONWT/ACC/VUT/7
11 May 1998
(98-1850)
Working Party on the
Accession of VanuatuOriginal:  English
ACCESSION OF VANUATU
Additional Questions and Replies
The Department of Trade, Industry and Inve stment of the Government of Vanuatu has
submitted the following replies to additional questions concerning the Memorandum on the Foreign
Trade Regime of Vanuatu (WT/ACC/VUT/2), the Questions and Replies thereon (WT/ACC/VUT/4)
and Additional Questions and Replies (WT/ACC/VUT/6), with the request that they be circulated to
Working Party members.
________________WT/ACC/VUT/7
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TABLE OF CONTENTS
Question
No.Page
No.
I. INTRODUCTION 1-4 1
II. ECONOMY AND FOREIGN TRADE 5-6 2
2. Foreign Trade 7 3
III. TRADE REGIME FOR GOODS
A. FOREIGN TRADE REGIME
1. Import Regulations
(a) The evolution of the customs tariff regulation 8-19 4(c) Import charges and fees 20-23 8
(d) Taxation regime 24-25 9
(f) Non-tariff measures, quotas and licensing system 26-29 10
(g) Customs valuation 30-31 12
(h) Rules of origin 32 13(j) Standards and certification 33-35 14
(k) Sanitary and phytosanitary measures 36-39 15
(l) Safeguards, anti-dumping and countervailing duties 40-41 17
B. Other Policies Affecting Foreign Trade
2. Agricultural Policy 42-44 17
5. Foreign and Domestic Investment Policy 45-48 18
6. Government Procurement 49 20
7. State-Trading Enterprises 50-52 20
V. TRADE-RELATED ASPECTS OF INTELLECTUAL
PROPERTY REGIME53-58 21
Patents 59-60 23
Layout designs (topographies) of integrated circuits 61 24
Geographical indications 62 24Industrial designs 63 24
Trademarks and service marks 64 25
Copyright and related rights 65-67 25
Enforcement 68 25
VI. TRADE-RELATED SERVICES REGIME 69-71 26
Financial services 72 27Telecommunications 73 28
Professional services 74 28WT/ACC/VUT/7
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Question
No.Page
No.
ANNEXES
ANNEX I Information on Import Licensing Procedures - 29
ANNEX II Information on Implementation and Administration of the
Customs Valuation Agreement-3 3
ANNEX III Questionnaire on State-Trading - 37
ANNEX IV Explanation of the Prohibited/Restricted Plant List - 39WT/ACC/VUT/7
Page 1
I. INTRODUCTION
Question 1.
Without access to key documents which have been cited by Vanuatu, including some which are
yet to be developed, a full assessment of Vanuatu’s trade regime and its WTO consistency
cannot be made.  In particular, it would help the examination if Vanuatu could supply
responses to three questionnaires in WT/ACC/1 format so that WTO Members can makeknown any concerns that they may have well in advance of the next meeting of the Working
Party.  The questionnaires are:
(i) the import licensing questionnaire (in the format described at Annex 3);
(ii) the customs valuation questionnaire (in the format described at Annex 4); and
(iii) the State-trading questionnaire (in the format described at Annex 6).
Answer
(i) Please see the attached Annex I which is the reply to the import licensing questionnaire
(Annex 3 of WT/ACC/1).
(ii) Please see the attached Annex II which is in rely to the customs valuation questionnaire
(Annex 4 of WT/ACC/1).
(iii) Please note that Annex VII of Vanuatu’s last set of questions (document WT/ACC/VUT/6)
was the reply to the State-trading questionnaire.  We attach this once again as Annex III.
Question 2.
We would suggest that full details of Vanuatu’s proposals for transitional arrangements be
submitted well in advance of the next meetin g of the Working Party in order that WTO
Members will have an opportunity to reflect and respond.  While it may be possible to negotiateshort transitions to implement some WTO prov isions, Vanuatu should not expect permanent
exemptions from any of the WTO requirements applicable to LLDCs.
Answer
The paper which covers the action programme for the passage of WTO consistent legislation
and the list of transitional arrangements required for their proper implementation will be forwarded tothe Secretariat shortly.
Question 3.
Please describe the steps that have so far be en taken to implement the Comprehensive Reform
Programme.
Answer
The reform of the public service has already commenced. The Vanuatu Budgetary process has
moved from line to programme budgeting. The draft value-added tax legislation is complete
(available in the Secretariat (Accessions Division, Room 1126) for consultation) and is expected to goWT/ACC/VUT/7
Page 2
before Parliament before May and will be implemented by July. There are several pieces that are
scheduled to go before Parliament in the May sittin g. Copies of the following proposed legislation are
also available in the Secretariat (Accessions Division, Room 1126) for consultation:
- Leadership Code;- Ombudsman Act;
- Foreign Investment Act;
- Immigration Act;- Work Permits Act;- Public Service Act.
The Government has implemented a Department of Strategic Management which provides advice to
the Office of the Prime Minister.  There will be a substantial down-sizing of the number of ministriesas well as support staff.
Question 4.
Please provide an update on the status of the legislation described in Annex I, which is designed
to bring much of Vanuatu’s trade regime into compliance with WTO obligations.
Answer
The comprehensive reform programme is described in Annex I (WT/ACC/VUT/6). We
assume that the question refers to Annex II which refers to the laws that are to be brought into
compliance with WTO obligations.  We have sought the assistance of WIPO, the Australian
Government and the Commonwealth Fund for Te chnical Cooperation (CFTC) to prepare draft
legislation in compliance with the legislative changes agreed in Annex II.  All the reforms agreed
under the Comprehensive Reform Programme (CRP) are currently being implemented.  We expect
the legislation to be in place by the end of the year  subject to the provision of technical assistance and
the Government’s legislative agenda which is expected to be quite heavy.
The legislative reforms that are discussed in the CRP will go before the Vanuatu Parliament
in the May to July sittings of Parliament.  The refo rms that are necessary to bring certain specific laws
into compliance with WTO obligations are expected to be brought to Parliament in the final sitting in
November 1998.
II. ECONOMY AND FOREIGN TRADE
Question 5.
What is the current status of Vanuatu’s legislation to implement a value-added tax regime?
Please provide a general description of the value-added tax legislation, including rates and
exemptions, as well as provide a copy of the legislation to the WTO Secretariat for review by the
Working Party.
Answer
The draft value-added tax has been released (available in the Accessions Division,
Room 1126 for consultation) for public comment and we expect passage through Parliament and
implementation by 1 August.  There has as yet been no firm decision on the rate of VAT but it isWT/ACC/VUT/7
Page 3
expected to be between 10-12.5 per cent.  The actual rate will depend upon the views provided by the
private sector. The VAT is a consumption base VAT. Exports are zero rated.
Question 6.
Vanuatu has indicated that a tax reform strategy is  currently being formulated and that it is yet
to determine its policy on VAT.  Vanuatu will need to supply information on, and appropriate
assurances regarding, its planned VAT system which will satisfy WTO Members that nationaltreatment and most-favoured nation treatment will be provided on a comprehensive basis in the
value-added taxation of imported goods.  National treatment and most-favoured nation
treatment will be required with respect to th e VAT rates that are applied to purchases of
imported goods and services as well as with re spect to any VAT concessions or exemptions.
Answer
The Government of Vanuatu is committed to im plementing VAT that is trade neutral and will
fully implement its obligations under Articles I and III of the GATT.  There will be no discriminationon source and signatories of the Melanesian Spearhead Group Agreement will also be subject to VAT
and well as signatories of any other preferential agreement.
2. Foreign Trade
Question 7.
In Vanuatu’s reply to question 7 of WT/ACC/VUT/6, the National Government of Vanuatu has
committed to removing the authority of provincial governments to raise import duties or import
taxes.
(i) Where do matters currently stand in relation to this commitment?
(ii) What control does the National Governme nt of Vanuatu have which will enable it to
ensure that other taxation practices of th e provincial governments are WTO consistent?
Answer
(i) The Government of Vanuatu will implement legislation under its WTO obligations to remove
any authority for provincial governments to tax imports or exports. This will be undertaken under a
technical assistance programme that has been requested from  the Australian Government and CFTC
and has been described above.
(ii) The Government of Vanuatu will implement legislative measures that will assure that
provincial governments will not introduce taxati on measures that are in violation of Vanuatu’s
commitments to the WTO.  This will be undertaken by revising the provincial government legislation
obliging all provincial governments to submit new fiscal measures to the Minister of Home Affairs
who, acting on advice from the Attorney General’s Office, will determine its WTO compatibility.WT/ACC/VUT/7
Page 4
III. TRADE REGIME FOR GOODS
A. FOREIGN TRADE REGIME
1. Import Regulations
(a) The evolution of the customs tariff regulation
Question 8.
Please create and provide to the Secretariat, for review by the Working Party, an electronic
copy of the Vanuatu customs tariff.  Thank you for providing an electronic copy of the trade
data for years 1994-1996.
Answer
An electronic format of the Vanuatu customs tariff is available in the Secretariat (Accessions
Division, Room 1126) for consultation.
Question 9.
According to the response to question 12 of WT/ACC/VUT/6, the Government of Vanuatu
intends to withdraw its guidelines for import tariff exemptions and draw up clear and
transparent guidelines as part of the new investment code that will be drawn up under the
Comprehensive Reform Programme.  The info rmation provided in Annex I regarding the
Comprehensive Reform Programme notes that a review of import tariffs to flatten and lower
rates and eliminate most exemptions was to have been completed as of 1 October 1997.  In orderto ensure transparency, we strongly encourage th e Government of Vanuatu to revise its import
tax law to limit, to the greatest extent possible, the use of import tariff exemptions.  Rather than
using a complex and potentially discriminatory tariff exemption scheme, the Government of
Vanuatu should give careful consideration to providing low bound tariff rates to imports items
which serve as inputs for those enterprises for which the Government seeks to encourage
operations.
What is the current status of this review?  Has the Tax Policy Unit, Customs, Attorney-General,
prepared a list of recommendations for legislativ e changes?  Please describe the changes that
have been recommended for inclusion in the new investment code and the legislative status for
these improvements.
Answer
The Government of Vanuatu intends to implement new legislation in precisely the manner
described in the question.  Tariffs will be lowered and inputs used in the production process for
operations that the Government wishes to encourage, will see their tariff lowered substantially.
Exemptions will be limited to the extent possible and guidelines for these exemptions will be made
available as soon as they are completed. This review and the guidelines are expected to be completed
before July 1998 when the new legislation is brought before the Vanuatu Parliament.
Question 10.
According to Section I of Schedule III of Vanuatu’s Customs Import and Export Duty Tariff,
the Minister for Finance of Vanuatu may, as he sees fit, exempt the following goods from the
payment of import duty:WT/ACC/VUT/7
Page 5
- any goods for use in a manufacturing or processing operation;
- any goods imported for a development project in the finance or commercial sectors,
tourism or mineral exploration; and
- any imported capital goods, parts and accessories, and fuel-oils for agriculture,
horticulture, livestock raising, forestry, inter-island shipping and fishing.
These provisions give the Ministry wide powers of discretion over the liability of Vanuatu
industry for payment of import duty.  We would like to know how the requirements of Article X
of GATT 1994 will be met after accession in relati on to how the Minister’s powers are exercised,
bearing in mind the requirement under this Article that notice of administrative rulings of
general application affecting rates of duty shall be published promptly.  We have a number of
questions relating to how these arrangements will operate after WTO accession.
- Will exemptions be notified publicly by means of the publication of an official notice of a
Ministerial decision in a timely manner?
- Will full details of each exemption be provid ed in such notification, including the entity
to which exemptions have been provided, details of the products which have been
exempted from payment of import duty, the period of time for which the exemptions
will apply, details of any conditions that will need to be satisfied for exemptions to be
provided (including any circumstances under which exemptions will be withdrawn) andfor continuation of exemptions after expiry of the period of time for existing exemptions,
and the reasons for granting the exemptions?
Answer
The aggregate data will be published on the value of exemptions that are granted by the
Foreign Investment Board. Exemptions information will only be made available in a public andaggregate form.
Question 11.
What is the formal application process for import duty exemptions?
Answer
In order to obtain an import duty exemption an applicant must complete the "Vanuatu Duty
Exemption Application Form".  The form is available from the Department of Trade and Industry,
Customs, Fisheries, Minerals and Tourism Department s. Each respective line department, e.g. tourism
or minerals, considers the application. The application, if acceptable is supported by the line
department and then forwarded to the Minister for Finance and is considered by the Duty Exemptions
Committee which comprises representative of Finance, Customs and Trade.
Question 12.
Are there any restrictions on who may apply for import duty exemptions?WT/ACC/VUT/7
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Answer
There are no restrictions on who may apply fo r exemptions but there are restrictions on
sectors where non-Ni-Vanuatu citizens may invest. These sectors are outlined below.
Question 13.
Are Ministers compelled under the law to respond to applications for import duty exemptions
within a certain period of time?
Answer
There is presently no such obligation.  Under the new legislation there will be clearly
prescribed deadlines that must be met along with requirements for judicial review.
Question 14.
Do applicants for import duty exemptions or for the continuation of existing exemptions have a
right to request the Minister of Finance to review a decision, and is the Minister under any legal
obligation to provide a response within a certain period of time?
- Is there a right of judicial review of any Mini sterial decision in relation to the provision,
refusal, continuation and withdrawal of such exemptions, as required under
Article X:3(b) of GATT 1994?
Answer
There is a standard common law right of judicial review under existing Vanuatu Law and this
will be further strengthened in the reform process.  The judicial system in Vanuatu only requires the
existence of just cause for review and the judiciary will entertain reviews of administrative as well as
ministerial decisions made in all such cases.
Question 15.
We note, in the response to question 14 of WT/ACC/VUT/6, that the Government of Vanuatu
does not discriminate on the granting of import duty exemptions to Vanuatu citizens, local
producers and on the basis of local ownership.  We also note that the Government is willing to
commit in its Protocol of Accession that it will complete and implement a non-discriminatory
investment code within 18 months of accession.
Why does the Government of Vanuatu feel that it needs 18 months after accession to complete
the revision of the investment code?  Does the Government have a specific date in mind for the
completion of the investment code?  Will the Government commit to non-discriminatory
application of the import duty exemptions until such time as the new investment code is
completed and implemented?WT/ACC/VUT/7
Page 7
Answer
The Government of Vanuatu has already prepared legislation which completely revises its
investment, business licence, work permit and immigration act.  These will now be passed before the
July sitting of Parliament and hence these reforms will be complete prior to accession
Question 16.
What is the current status of Vanuatu’s investment code and revision of foreign investment,
immigration and labour laws?  Please provide copies of this legislation to the WTO Secretariat
for review by the Working Party.
Answer
The draft legislation is available in the Secretariat (Accessions Division, Room 1126) for
consultation.
Question 17.
According to the response to question 13 of WT/ACC/VUT/6, the Vanuatu Customs Tariff Act
was to have been provided in Annex IV.  However, this item did not appear to been actually
included among the annexes provided to the Secret ariat.  Please provide a copy of the Vanuatu
Customs Tariff Act to the Secretariat for review by the Working Party.
Answer
A copy of the Vanuatu Customs Tariff Act is available in the Secretariat (Accessions
Division, Room 1126) for consultation.  Please note that a new draft tariff schedule is also available.
Question 18.
Is Vanuatu currently using the 1996 HS tariff system to the 8-digit level?  If not, please describe
fully any discrepancies.
Answer
Vanuatu will be employing HS96 to six-digit level from 1 July 1998. The seven- and
eight-digit level reflects national classifications.
Question 19.
Please provide the base duty rates (column 3), which appears to be missing for all items in
WT/ACC/VUT/6.
Answer
One assumes that the question relates to the actual applied rates in Vanuatu.  A copy of the
customs tariff is available in the Secretariat (Accessions Division, Room 1126) for consultation.WT/ACC/VUT/7
Page 8
(c) Import charges and fees
Question 20.
According to the response to questions 22 and 24 of WT/ACC/VUT/6, the Government of
Vanuatu intends to introduce a service tax of 1 p er cent of c.i.f. value of imports in its customs
tariff schedule.  The 1 per cent ad valorem  service tax appears to violate the GATT Article VIII
requirement that fees and charges on importation shall be limited in amount to the approximatecost of services rendered.  Additionally, these ch arges should not act as a taxation on imports or
exports for fiscal purposes.  The Government of Vanuatu should develop a schedule of fees
based upon the costs involved in providing the particular services to be performed.
Answer
The Government of Vanuatu will not charge a service fee based on any ad valorem
calculation but will be based only on the specific cost of services rendered.  Please note the revised
tariff binding offer.  This new system will be in place by 1999.
Question 21.
The “service tax” (inappropriately shown at column 9 of Vanuatu’s Schedule of Commitments
for Goods) will need to be made fully consis tent with the requirements of Article VIII of
GATT 1994.  Its present ad valorem  form fails to meet those requirements because an ad
valorem  charge can exceed the cost of the service rendered, especially as the charge is in
proportion to the value of shipments whereas the cost of processing an import document (for
example) is not related to the value of a shipment.  Such charges really need to be collected as a
specific duty which equates to the actual cost of  the service.  We would appreciate Vanuatu’s
advice on when and how this will be achieved.
Answer
The Government of Vanuatu will not charge a service fee based on any ad valorem
calculation but will be based only on the specific cost of services rendered.  Please note the revised
tariff binding offer.  This new system will be in place by 1999.
Question 22.
According to the responses to questions 25-27 of WT/ACC/VUT/6, the 3 per cent commission
for rice flour, sugar and canned mackerel, a nd the 4 per cent commission for tobacco, payable
to the Vanuatu Cooperative Federation, will be  incorporated into the import tariff and be
abolished.  Do the duty rates for these items that is proposed in WT/ACC/SPEC/VUT/2/Rev.1
reflect this change?
Answer
The offer in WT/ACC/SPEC/VUT/2/Rev.1 reflects these changes.WT/ACC/VUT/7
Page 9
Question 23.
The proposed tariff schedule, WT/ACC/VUT/6, has two columns, a bound rate of duty and a
bound rate of duty surcharge.  How is the duty surcharge applied?  Is it applied as a percentage
of the amount of customs duty (i.e., 10 per cent surcharge times 20 per cent customs rate times
the customs value, in the case of live poul try)?  Why did Vanuatu not simply increase the
proposed customs rate to reflect the amount of the duty surcharge (i.e. 22 per cent, in the case of
live poultry)?  Please confirm that the duty su rcharge for items that are being proposed for
staging to zero duties (i.e., information technology products and civil aircraft), will not be
subject to a duty surcharge when the zero customs duty is fully phased-in.  Vanuatu should
eliminate the duty surcharge column and have only one bound duty rate.
Answer
The surcharge is based upon c.i.f. not c.i.f. plus duty and is applied as a revenue measure in
light of the system of exemptions.  It is expected that the surcharge will not be exempted in future.
Vanuatu is implementing these measures in order to decrease the cost of communication with the
outside world and hence has no interest in raising revenues in this area.
(d) Taxation regime
Question 24.
According to the response to question 30 of WT/ACC/VUT/6 and the Vanuatu Comprehensive
Reform Programme, the Tax Policy Unit, At torney-General, was responsible for the
replacement of the turnover tax and minor taxes with a value-added tax, as of 1 January 1998.
What is the current status of this proposal to  replace the turnover tax with the VAT.  Please
describe the general provisions of the VAT Law and provide a copy of the law or draft
legislation for review by the Working Party.  Please identify and describe fully any areas inwhich the VAT Law does not conform with the requirements of GATT Article III.
Answer
Please note the answers to the identical questions posed in section (a) above.  The VAT Law
is in full conformity with Article III obligations and will now be implemented by 1 August 1998.
Question 25.
According to the response to question 33 of WT/ACC/VUT/6, there is an excise tax on
domestically-produced beer.  Is imported beer su bject to any taxes other than the customs duty
and duty surcharge?  If so, please describe.
Answer
There is no excise on imported beer.  However, in order to fulfil Vanuatu’s obligations under
Article III of the GATT 1947 Vanuatu will commit in its Protocol of Accession to impose the same
excise on domestic and imported beer.  No other products are subject to excise tax.WT/ACC/VUT/7
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(f) Non-tariff measures, quotas and licensing system
Question 26.
The Minister of Trade of Vanuatu is able to restrict or prohibit the importation of goods on the
grounds that the goods compete with local industry.  Vanuatu has not indicated to WTO
Members the legislation under which the Minister of Trade has the power to do this, has not
provided a copy of the legislation, has not prov ided a list of the imports that are currently
prohibited in this way, and has not provided a list of the imports that may be subject to such
prohibitions in the future.  Vanuatu has also not provided any information on how the
provisions of Articles X and XI of GATT 1994 will be satisfied in the event of the use of thesepowers.
The WTO justification for this import prohibition power put forward by Vanuatu indicates that
Vanuatu would wish to continue this practice after accession under the infant industry
provisions of Article XVIII of GATT 1994.  We believe that this is inappropriate and have askedVanuatu to revoke the power of the Minister of Tr ade to restrict or prohibit the importation of
goods on the grounds that the goods concerned co mpete with local industry, or to adjust these
powers so that action would only be taken in a manner consistent with the WTO Agreement (for
example, under Article XIX of GATT 1994 and the Safeguards Agreement).
The infant industry provisions of the GATT were negotiated in different economic times and
are an anachronism.  They are no longer used, nor should they be.  The multilateral trading
system is based on the provision of industry protection through tariffs (which are a transparent,
simple, price-based measure, unlike quantitative restrictions).  Any planned policies to develop
industries through WTO-inconsistent trade measures should be made known to WTO Membersprior to accession.  The appropriate time and place for Vanuatu to seek to accommodate its
industry protection needs is in the context of the market access/tariff negotiations phase of this
accession.  If there should be a subsequent n eed to provide increased tariffs, Vanuatu would
need to use Article XXVIII of GATT 1994 to renegotiate its commitments.
Answer
The Minister of Trade of the Government of Vanuatu has the power under the Imports of
Goods Control Act to restrict the entry of goods competing with domestic production.  This measure
is currently employed to restrict imports of a very limited range of goods such as screen printed
T-shirts. (Copies of this legislation were sent to the WTO in 1996).  Vanuatu will lift the import ban
on T-shirts with Vanuatu motif or embroidery and replace this with a tariff of Vatu 500 per unit or
70 per cent whichever is greater.  Vanuatu commits to use the Import of Goods Control Act in amanner consistent with its WTO obligations.
Question 27.
The position is still not clear regarding Vanuatu’s NTMs that have no valid WTO justification.
Such NTMs would include, inter alia , quantitative restrictions and measures that are
inconsistent with Article XI of GATT 1994, including price controls that would distort the
relationship between domestic and international prices.  They would also include measures that
are inconsistent with the SPS, TBT, Subsidies and Countervailing Measures, Import Licensing
and Agriculture Agreements.  Vanuatu will need to supply to WTO Members complete detailedinformation on its NTMs.  This information will need to be supplied at an early stage so thatWT/ACC/VUT/7
Page 11
WTO Members can make known any concerns that they may have well in advance of the next
meeting of the Working Party.  Vanuatu wi ll need to set out in tabulated form:
(i) the products that are affected by NTMs  (referenced to the tariff lines for those
products);
(ii) a description of the NTMs applying to each product; and
(iii) either Vanuatu’s WTO justification of th e NTM, or the timetable for its removal (e.g.,
before accession, upon accession).
Answer
Vanuatu does not have nor does it maintain a system of price controls nor does it have
legislation to effect it.  The table below outlines all NTMs and measures that will be taken to deal
with all outstanding measures that are not consistent with existing WTO provisions.
NTMs - Justification and/or Required Actions
ItemHS 96
ClassificationNon-Tariff  MeasureJustification/Timetable for
Removal
Screen printed T-shirts(with Vanuatu motif andembroidery)61.09 Import licence - Ban Removal and replacement
with tariff of VT 500 per unitor 70%, whichever is greater
Firearms and ammunition 93.04-93.06 Import licence Article XX
Liquor and spirits 22.08 Import licence -
automaticArticle XX
Pornographic material NA Import ban Article XX(a)
Rice 10.06 Subject to import
licence issued by
Vanuatu Co-op Fed
with commission of
3-4%The Government of Vanuatu
commits to eliminate these
commissions and remove
theses NTMs prior to
accession.
Flour 11.05-11.06 “ "
Sugar 17.01 “ "
Canned fish 1604 “ "
Tobacco products 24.01-24.03 “ "
Plants and other productscontrolled by CITESNA Import licence from
the Vanuatu
Quarantine ServiceArticle XX - pending
WTO/CTE decision
Question 28.
We are pleased to note that Vanuatu has eliminated its seasonal restrictions on potatoes.
According to the response to question 38 of WT/ACC/VUT/6, Vanuatu will move to eitherWT/ACC/VUT/7
Page 12
impose tariffs on rice, sugar, flour, canned mack erel, tobacco products and T-shirts or eliminate
the import orders and other protective measures altogether.  What is the current status of the
Government of Vanuatu’s efforts to eliminate the use of "import orders" for these products?
Answer
The Government of Vanuatu ensures the Working Party that the import orders will be
rescinded prior to accession.
Question 29.
We understand that import licensin g is not applied in Vanuatu at present, although provision
exists to introduce it.  Vanuatu will need to provide a commitment that import licensing will
conform to WTO requirements, including the Agreement on Import Licensing Procedures.  We
also note that Vanuatu has committed to the abolition of the non-automatic licensing of
imported rice, flour, canned mackerel, sugar, tobacco products and potatoes (reply to
question 54 of WT/ACC/VUT/6 refers).  Where do matters currently stand in relation to thiscommitment?
Answer
The Government of Vanuatu is committed to th e abolition of these NTMs as a condition of
accession and further commits that any future import licences that may be required will be in
conformity with its obligations under the Agreement on Import Licensing Procedures.
(g) Customs valuation
Question 30.
According to the response to question 59 of WT/ACC/VUT/6, the Government of Vanuatu
intends to incorporate the WTO Agreement on Customs Valuation into domestic law by the
year 2000.  We are sympathetic to Vanuatu’s expressed desire to receive technical assistanceand training of its customs staff in order to implement the WTO Customs Agreement.
Nevertheless, we consider the Customs Valuatio n Agreement to be among the most important
agreements reached during the Uruguay Round and we expect all acceding countries to
implement the Agreement in its entirety as of th e date of accession.  Please provide a complete
update on the steps that Vanuatu has already taken and a schedule of the remaining stepsnecessary to revise its existing Customs Co de in order to incorporate the WTO Customs
Valuation Agreement (CVA).  Please provide the Secretariat, for review by the Working Party,
a copy of the draft customs valuation legislation and regulations.
Answer
The Government of Vanuatu is sympathetic to the concerns of WTO Members in this area.
However, Vanuatu is an LDC but it is willing to commit to have the legislation on Customs Valuation
in place prior to accession.  There is a Commonwealth Fund for Technical Co-operation team that will
be in Vanuatu in April 1998 to provide training which will be supplemented by regional training at the
Forum Secretariat.  In 1999 the Government of Vanuatu will be seeking technical assistance for
in-country training of officials to implement obligations under the CVA.  It is technically feasible to
have all legislation in place by the second half of 1998 if technical assistance is provided.  However,
the Government of Vanuatu cannot technically have officials trained and the legislation in placebefore January 2000 and will therefore seek a transition period of three years in order to implement
the CVA.WT/ACC/VUT/7
Page 13
Question 31.
We understand that Vanuatu has not yet implemented the Customs Valuation Agreement, and
would be interested to know:
- whether Vanuatu is prepared to write into its Protocol of Accession a commitment to
fully implement the Customs Valuation Agreement by the year 2000;
- the details of any proposal for transitional arrangements, including information on
progress with designing and implementing new procedures consistent with the Customs
Valuation Agreement, future steps and the ar eas of the Agreement which it expects to
have difficulty implementing, and how Vanuatu expects to overcome these difficulties;
- whether Vanuatu intends to invoke the other provisions of the Customs Valuation
Agreement providing special and differential  treatment for developing countries, e.g.,
the transitions/reservations on computed  value method, minimum values, reversal of
sequential order, etc; and
- Vanuatu’s plans to undertake a thoroughgoing needs assessment with regards to
customs legislation, procedures, administration and practices, with a view to full
implementation of the Customs Valuation Agreement.
Answer
See the answer to question 30.
(h) Rules of origin
Question 32.
According to the response to question 61 of WT/ACC/VUT/6, the Government of Vanuatu is
relying on World Customs Organization recommendations for the development of rules of
origin.  Please provide an update on the status of these changes (i.e., have the WCOrecommendations been received, has legislative or regulatory drafting begun)?  When does the
Government of Vanuatu expect to implemen t the WTO Agreement on Rules of Origin?
Answer
There appears to be a misunderstanding of the Government of Vanuatu's response to
question 61. The Government of Vanuatu is relying upon the harmonised WTO/WCO rules of originwhich it will employ in its own trade regime once the rules have been finalised.  Thess rules of origin,
as the Working Party is no doubt aware, are not yet complete and when they are the Government of
Vanuatu undertakes, where applicable, to bring its trade legislation as well as regional arrangements
into conformity with the harmonised rules of orig in.  Through the Melanesian Spearhead Group, and
in co-operation with its Melanesian partners, the Government of Vanuatu proposes to bring the MSGTrade Agreement into conformity with the WTO rules of origin.
The rules of origin that the Government of Vanuatu employs in both its multilateral and its
bilateral treaty arrangements are based upon a change in HS classification at six-digit level between
input and output.WT/ACC/VUT/7
Page 14
(j) Standards and certification
Question 33.
According to the response to questions 64 and 66 of WT/ACC/VUT/6, Vanuatu does not have
laws providing for the determination and regulation of standards beyond sanitary and
phytosanitary standards.  Vanuatu also does not belong to any international standards bodies,
other than the OIE and organizations involved in  sanitary and phytosanitary standards.  Please
describe the steps that Vanuatu has already taken to establish a standards system that will
conform with the requirements of the WTO Agreem ent on Technical Barriers to Trade.  Which
aspects of the TBT Agreement does the Government of Vanuatu expect to be the most difficult
to implement and why?
Answer
The Government of Vanuatu, as stated quite clearly in WT/ACC/VUT/6, maintains no
standards regime apart from health and construction standards. The Government of Vanuatu does notsee these standards as posing any potential barrier to trade as defined in the TBT Agreement.  The
Government of Vanuatu feels that given its current stage of development it has no option but to leave
most technical standards issues as a private contractual matter between buyer and seller.  The
technical capacity to  create, administer and police such standards does not exist at this stage.  The
Government of Vanuatu commits that in the event th at it does create such standards in future that
these will be in conformity with its WTO obligations under the TBT Agreement.
Question 34.
Has Vanuatu begun to establish an enquiry point, as required by Article 10 of the TBT
Agreement?
Answer
The Government of Vanuatu has established an enquiry point for all standards. Please note
that the Government of Vanuatu has completed and circulated the TBT questionnaire (i.e., Annex 5 of
WT/ACC/1) as Annex VIII (WT/ACC/VUT/6).  The agency dealing with this is the Department of
Trade and the contact point is the Director of Trade who will in future fulfil all TBT notification and
enquiry point obligations to WTO Members.  This point is fully functioning.
Question 35.
Is Vanuatu represented at any international sta ndards organizations by any regional entities,
such as the South Pacific Forum?  What plan s does Vanuatu have for becoming a member of
international standards organizations, such as the ISO?
Answer
The Government of Vanuatu is not represented either directly or through the Forum at any
international standards bodies such as the ISO.WT/ACC/VUT/7
Page 15
(k) Sanitary and phytosanitary measures
Question 36.
The examination of Vanuatu’s SPS measures against WTO requirements has not proceeded
very far.  Essential information will need to be  supplied at an early stage so that WTO Members
can make known any concerns they may have well in advance of the next meeting of the
Working Party.  The following information gaps need to be filled:
(i) full details of all sanitary and phytosanitary measures, including prohibitions or other
restrictions such as certification requirements, or of legislation which has any impact on
sanitary/phytosanitary measures (e.g., the health law);
(ii) an explanation of the role and authority of  the South Pacific Commission in determining
sanitary/phytosanitary measures for Vanuatu;
(iii) Vanuatu’s justifications, on scientific gr ounds and in terms of the conditions prevailing
in Vanuatu, of any restrictions or prohibitions it applies, including any variations fromrelevant standards, recommendations or guide lines of bodies such as the IPPC and
Codex; and
(iv) details of mechanisms in place, or progress toward the establishment of such
mechanisms, designed to impl ement the requirements of the SPS Agreement;  this would
include, for instance, arrangements for the application, enforcement and review of SPSmeasures as well as procedures for acceptance of the SPS procedures of other WTO
Members, where the latter can demonstrate that their measures meet Vanuatu’s
appropriate level of SPS protection.
Answer
(i) With regards to details of general SPS measures, refer to CAP 34, Sections 1 and 2 of the
Import of Plants Act.  Under Section 1 of the legislation no person is permitted to import plants
without applying for and receiving an import licence from the Director of Agriculture.  Under the
legislation (available in the Accessions Divisio n, Room 1126 for consultation) the Minister has the
authority to prohibit imports.
The Convention on International Trade of Endang ered Species (CITES) and the International
Trade of Fauna and Flora Act 1993 restricted the importation of some plant species, for instance
orchids and tree ferns.
All imports into Vanuatu require a phytosanitary certification from the country of origin, and
must conform with Vanuatu import requirements.
The health legislation of Vanuatu, as described in WT/ACC/VUT/6, only prohibits the
importation of food products that are not fit for human consumption.
(ii) The Secretariat of the Pacific Community (SPC) has no legal role in setting SPS standards
for Vanuatu. The SPC provides scientific advice and technical assistance to member countries on SPS
measures.  It also provides technical assistance and training in these areas.
(iii) Please see Annex IV hereto which offers a justification for each item which is currently
restricted.WT/ACC/VUT/7
Page 16
(iv) Vanuatu currently lacks national capability (human resource and equipment) to conduct
scientific tests to determine entry of imported goods.  However, the Government of Vanuatu allows
imports of restricted plants and plant products if the exporting country meets specific import
requirements such as pathogen tested tissue culture, processed foods.  With the assistance of
New Zealand, Vanuatu is developing guidelines base d on scientific principles to formulate procedures
for the safe importation of plant and plant products (Annex VII).  Scientific principles which will beapplied in future are:  area of freedom, treatment (heat treatment), tissue cultured materials which
should eliminate the risk of new pests introductions.
Under the SPC training programmes have been set in place which will enhance the ability of
quarantine services in Vanuatu to implement legislation.
Question 37.
According to the information provided in A nnex VII, “List of Quarantine Restrictions”,
Vanuatu prohibits the importation of live animals and animal products, as well as 30 plant andplant products.  We are concerned that the G overnment of Vanuatu is using sanitary and
phytosanitary standards inappropriately.  The WTO Agreement on Sanitary and Phytosanitary
Measures provides that these measures shall only be applied to the extent necessary to protect
human, animal or plant life or health, is based on scientific principles and is not maintained
without sufficient scientific evidence.  Please de scribe the steps that Vanuatu is currently taking
to implement the WTO Sanitary and Phytosanitary Agreement.
Answer
See the answer to question 36.
Question 38.
We note that Vanuatu is planning to join the International Plant Protection Convention (IPPC),
the Asia and Pacific Plant Protection Commission (APPC) and the Codex Alimentarius
Commission (Codex).  Has Vanuatu applied fo r membership in the IPPC, APPC or Codex?
Answer
Vanuatu through the Ministry of Foreign Affairs has applied for membership to the IPPC,
APPC and Codex in 1997.  To date Vanuatu has received no replies.
Question 39.
For each of the products listed in Annex VII, “List of Quarantine Restrictions”, please describe
any less-trade restrictive measures that were co nsidered, such as limiting import restrictions
from specified geographical areas, and the reasons they were not adopted.
Answer
We envisage that under the Bilateral Quarantine Agreement (BQA)we have with
New Zealand, the current list of restricted plant and plant products will be revised.  The decision to
import will be based on Pest Risk Assessment (PRA) on a case-by-case basis.WT/ACC/VUT/7
Page 17
(l) Safeguards, anti-dumping and countervailing duties
Question 40.
We note in the responses to questions 74-77 of WT/ACC/VUT/6, that Vanuatu is not considering
having any anti-dumping, countervailing or safeguard measures legislation.  Will the
Government of Vanuatu commit to the non-application of any anti-dumping, countervailing or
safeguard measures until WTO-consistent legislation is enacted and notified to the appropriate
WTO committee?
Answer
The Government of Vanuatu commits to the application of only WTO-consistent trade
measures and laws as it pertains to anti-dum ping and safeguard measures.  The Government of
Vanuatu reserves the right to  introduce WTO-consistent legislation on anti-dumping and safeguard
measures. Any measures that will be introduced will be submitted to the Committee on Safeguards.
Question 41.
Vanuatu has stated that “... it retains the righ t to introduce safeguard provisions in its
legislation in a manner consistent with its WTO obligations”.  Vanuatu will need to affirm that
it will not introduce safeguard measures unless it has first introduced legislation and procedures
that are fully consistent with the requirement s of the WTO, including Article XIX of GATT
1994 and the Agreement on Safeguards.  Alternatively, Vanuatu will need to provide theWorking Party with details of its plans for safe guards covering, inter alia, the nature of the
safeguards that Vanuatu will introduce, th e circumstances in which safeguards may be
activated and the legal basis for them.  It would acceptable for Vanuatu to join the WTO
without appropriate safeguard measures in place.  However, after accession, Vanuatu would
need to enact legislation and devise procedures and submit these for the approval of the WTOCommittee on Safeguards before action could be taken to impose measures on imports.
Answer
See above.
B. Other Policies Affecting Foreign Trade
2. Agricultural Policy
Question 42.Vanuatu should submit a response to the questionnaire on agricultural supports and subsidies
(WT/ACC/4) in advance of its next Working Party meeting.
Answer
This will be submitted to the Working Party  prior to the Working Party meeting scheduled
for September.
Question 43.
According to the response to question 60 in WT/ACC/VUT/4, there are no export subsidies in
Vanuatu.  Export subsidies are the most trade distorting forms of agricultural support.  SinceWT/ACC/VUT/7
Page 18
Vanuatu does not presently have export subsidies, we do not believe it has the right to now
establish them.  We strongly encourage Vanuatu to  maintain its export subsidy-free regime and
bind its export subsidy commitment at zero.
Answer
The question of export subsidies is quite academic as Vanuatu has never employed export
subsidies and does not have the resources to do so.  Vanuatu will comply with all future obligations inthe area of export subsidies once they have been negotiated  at  multilateral trade negotiations.
Question 44.
Vanuatu has no right of access to Urugu ay Round methodologies such as the special
agricultural safeguard, although if it did, Vanua tu would of course need to provide the Working
Party with full details of how it would activate, apply and withdraw such safeguards and the
basis for such processes in domestic law.
Answer
The Government of Vanuatu will not use special safeguard measures.
5. Foreign and Domestic Investment Policy
Question 45.
According to the response to question 90 of WT/ACC/VUT/6, there is currently a negative list of
business ventures and activities that can only  be pursued by indigenous Ni-Vanuatu, which
includes service sectors such as taxis, buses, ka va exports, rural transportation, mobile vendors,
small retail and to some extent small bakeries.  Please provide a copy of the list of business
ventures and activities that can be pursued only by indigenous Ni-Vanuatu.
Answer
There exists a negative list of investments in the proposed Investment Code legislation that
the Government of Vanuatu proposes to prohibit. These include:
- manufacture of nuclear weapons;
- manufacture of chemical weapons;
- arms manufacture;
- dumping and storage of nuclear waste; and,- dumping or storage of toxic chemicals.
There also exists a  reserved list of professions in the Labour (Work Permits) Act.
- able seaman/ordinary seaman; - hotel receptionist;
- boatswain; - housemaid;
- bus driver; - lorry and van driver;
- carpenter/joiner; - receptionist;- clerical supervisor; - street vendor;- dock worker; - typist;
- driver; - waitress/waiter;WT/ACC/VUT/7
Page 19
- earth moving and related machinery operator; - bar tender.
Businesses reserved  for Ni-Vanuatu  currently include:
- the export of kava;
- owning taxis or buses; and,
- owning kava bars.
Question 46.
Please identify and describe any import or expo rt activities, other than kava export, which are
reserved solely for indigenous Ni-Vanuatu.
Answer
For the purposes of investment policy there is no category of "indigenous Ni-Vanuatu". The
only difference is between Ni-Vanuatu and non-citizens. The only export sector where non-citizens
are excluded is the export of raw kava.  Proscribed sectors such as kava exports and copra are, under
the Business Licence Act, excluded to non-Ni-Vanuatu.
Question 47.
Will Vanuatu’s new foreign investment law eliminate the discretion of the Business Licence
Committee and Minister of Finance to approve foreign business and investment activities?
Answer
The proposed legislation will eliminate the discretion of the Minister of Finance in most
investment activities.  At present only in the financial sector will the Minister continue to have
discretionary authority.  If the Minster refuses to grant a business licences, in future he will have to
provide a justification and his decision will be subject to judicial review.
Question 48.
Vanuatu has indicated that an investment code is under preparation which would address
important issues such as labour laws, immigration, business legislation including land laws, and
foreign investment, and streamline investment procedures with regard to administrative duties,
approvals, land disputes, industrial disputes and political interference (paragraph 12 of the
WTO Secretariat Factual Summary).  We note that there has been a delay in presenting thedraft investment code to Parliament.  Can Vanuatu advise the current situation?
We believe that completion of the investment co de will be crucial for ensuring that there are
codified and transparent procedures for foreign in vestment in the services sector and that laws
governing this investment are legally enforceabl e and free from administrative discretion and
other forms of interference.  Without the investme nt code, it would be difficult to be confident
that the commitments Vanuatu is offering to undertake with respect to the establishment of
commercial presence could be made effective.WT/ACC/VUT/7
Page 20
Answer
In relation to earlier questions, the Government of Vanuatu has indicated that it has already
prepared draft legislation, copies of which are available in the Secretariat (Accessions Division,
Room 1126) for consultation.  We expect this legislati on will come into force by the end of this year.
6. Government Procurement
Question 49.We are disappointed that Vanuatu does not intend to join the Agreement on Government
Procurement (GPA) in the context of its accession  to the WTO.  We are strongly urging all
acceding countries to join the WTO GPA.  Vanua tu should reconsider its decision and commit
to acceding to the GPA prior to WTO accession .  The WTO GPA works to assure that countries
bidding on government procurement projects in foreign countries will have a transparent and
open process with recourse to unbiased dispute settlement procedures.  Greater transparency
and rule of law reinforce good government and economic efficiency.
Answer
The Government of Vanuatu believes that the current system of tender in Vanuatu is open and
transparent.  The Government of Vanuatu agrees to comply with all covered multilateral Agreements
of the WTO.
7. State-Trading Enterprises
Question 50.
According to the response to question 101 of WT/ACC/VUT/6, Vanuatu intends to notify the
Vanuatu Commodities Marketing Board (VCMB) pursuant to GATT Article XVII, because it is
the sole exporter of coca, copra and kava.  Please submit the State trading questionnaire for
VCMB prior to the next meeting of the Working Party.
Answer
Please see Annex III hereto.
Question 51.
We also noted in the response to question 101 of WT/ACC/VUT/6 that Vanuatu does not intend
to notify the Tanna Coffee Development (TCDC) enterprise because it is not exporting coffeenow.  While TCDC is not exporting coffee at the present time, it nevertheless appears to be a
State-trading enterprise within the meaning of  the definition provided by paragraph of the
Understanding on the Interpretation of GATT Article XVII, because it has been granted an
“exclusive or special rights and privileges (mono poly on the purchase of coffee for exports) ... in
the exercise of which it can influence through th eir purchases and sales the level or direction of
imports and exports”.  Since TCDC has a monopoly on purchases of coffee for export, it is
effectively influencing the level of coffee exports.  Please complete and submit the State-trading
questionnaire for TCDC prior to the next Working Party meeting.WT/ACC/VUT/7
Page 21
Answer
TCDC has now been privatized and has no exclusive or special privilege arrangements and
has no monopoly rights on coffee.  As a condition of privatization all rights and privileges of the
previous company, i.e., TCDC, were revoked and any company may now produce, export or import
coffee to or from Vanuatu.
Question 52.
According to the response to question 97 of  WT/ACC/VUT/6, the Central Stores purchases
stationery and other supplies used by the Government of Vanuatu.  There is no obligation for
government departments to purchase supplies from the Central Store.  Does the Central Store
sell stationery and other supplies to the public or any non-governmental entities?  Are the
Central Stores obliged to adhere to the tendering and transparency rules for government
procurement that are provided by Chapter 22, Regulation 361-368, of the Financial
Regulations, in making its purchases?  Please identify any products, other than stationery,
which the Central Stores are authorized to purchase on behalf of the Government of Vanuatu.
Answer
The Central Government Store does not sell to the public and non-governmental entities. The
Central Government Store is also governed by Chapter 22 of the Financial Regulations. The Central
Government Store also supplies office equipment such as furniture to the Government.
V. TRADE-RELATED ASPECTS OF INTELLECTUAL PROPERTY REGIME
Question 53.
In its answer to question 105 in document WT/ACC/VUT/4, Vanuatu states that since achieving
independence in 1980 it has not produced any intellectual property legislation.  Does this mean
that IPR protection does not exist at all or is there just a lack of new laws?
Answer
Intellectual property legislation exists in Vanuatu but no new legislation has been introduced.
There is also a Patent and Trademark Office.  Existing legislation is not WTO compatible as it was
prepared before the Uruguay Round.  Vanuatu now plans to introduce TRIPS-consistent legislation
prior to its accession to the WTO.
Question 54.
We were disappointed to note, in the responses to questions 103-110 of WT/ACC/VUT/6, that
the Government of Vanuatu does not intend to implement the WTO TRIPS Agreement until
three years after accession.  We consider th e WTO TRIPS Agreement to be among the most
important of the Agreements reached during the Uruguay Round and a fundamental obligationundertaken by all WTO Members.  We therefo re expect all acceding countries, including
Vanuatu, to adopt and implement WTO TRIPS-co mpatible legislation covering all types of
intellectual property prior to WTO accession.WT/ACC/VUT/7
Page 22
Answer
The Government of Vanuatu has sought technica l assistance from WIPO to draft legislation
on intellectual property that is TRIPS compatible by the end of 1998.  WIPO will advise on technical
aspects of the implementation of the legislation.  There is an action plan which explains the timetable
for the passage of all WTO-related legislation which will be forwarded to the Secretariat shortly.  The
current patent and trademark office will require considerable strengthening.
Question 55.
An undertaking to fully implement the TRIPS Agreement within three years of accession
(replies to questions 103, 104, 108 and 110 of WT/ACC/VUT/6 refer) seems reasonable for an
LLDC in the early stages of TRIPS implementation  if a valid justification for the transition in
terms of need has been provided and if the tr ansition is consistent with the requirements of
Articles 65 and 66 of the TRIPS Agreement.  A key issue associated with such an undertaking is
Vanuatu’s capacity to effectively implement thes e disciplines within the proposed time-frame.
Vanuatu will need to promptly provide the following information to WTO Members so that
they can make known any concerns that they may have with Vanuatu’s proposal well in
advance of the next meeting of the Working Party:
(i) full details of Vanuatu’s plans for TRIPS im plementation, including for accession to all
of the conventions under the TRIPS Agreement (including the conventions that were not
specifically mentioned in Vanuatu’s replies to questions 106, 108, 109 and 110 of
WT/ACC/VUT/6); and the steps that will enable the judiciary and the enforcement
authorities to enforce Vanuatu’s intellectual property legislation:
(ii) the steps that Vanuatu has already taken towards TRIPS implementation; and
(iii) Vanuatu’s unmet technical assistance needs in relation to TRIPS and its plans to ensure
that all such needs will be met be fore its proposed transition expires.
Answer
(i) The Government of Vanuatu has agreed to pass domestic legislation by the end of 1998
providing protection of intellectual property for all areas covered by the TRIPS Agreement.
However, implementation of the legislation will require some time as those who are directlyconcerned with this area, such as the patents office, customs and police require special training
courses.
(ii) The Government of Vanuatu has sought technical assistance from WIPO in this area.  We are
expecting draft legislation by the end of May for which we will seek legal advice and then, if
acceptable provide draft copies to WTO Members for comments.  We shall assure that the proposeddrafts are in full conformity with our obligations under the TRIPS Agreement.
(iii) Vanuatu may require extra technical assistance especially in terms of explaining the
implications of the TRIPS legislation to the most important elements of the public service as well as
the public at large.  We may be seeking technical assistance for in-country training seminars in the
area of TRIPS. Such assistance will be requested from the Government of Australia and the CFTC on
a region-wide basis by the South Pacific Forum Secretariat.WT/ACC/VUT/7
Page 23
Question 56.
Prior to the second Working Party meeting, Vanua tu should prepare a rep ort on the status of
new and amending legislation designed to en sure conformity with WTO TRIPS requirements.
This report should provide a timetable for drafti ng and enacting legislation for each type of
intellectual property, as well as identifying the governmental body which is responsible for
drafting of the legislation.  Please submit copies of such draft legislation to the Secretariat forreview and comment by Working Party members.
Answer
The draft report will be forwarded to the Secretariat shortly.
Question 57.
We note in the responses to WT/ACC/VUT/6 that the Government of Vanuatu has already
approached WIPO for technical assistance to rev ise domestic legislation to assure compliance
with the TRIPS provisions.  Additionally, we commend Vanuatu for its decision to accede toWIPO and the Paris and Berne Conventions.  What is the current status of Vanuatu’s request
for WIPO technical assistance?  What is the stat us of Vanuatu’s applications to join WIPO and
the Paris and Bern Conventions?
Answer
Vanuatu has not yet sought membership in these conventions or in WIPO.
Question 58.
Does Vanuatu intend to become member of any international convention in the area of IP
(answer to questions 105 and 110 in document WT/ACC/VUT/6)?
Answer
In our response to question 101 (WT/ACC/VUT/6) Vanuatu stated that it intends to become a
member of the Paris and Berne Conventions.
Patents
Question 59.
Could Vanuatu be more detailed in its answer to question 101 in document WT/ACC/VUT/4 on
government use and compulsory licences (Article 31 of the TRIPS Agreement)?
Answer
Compulsory licences have not been an issue in Vanuatu at all and given the current level of
development where there is very little manufacturing or other non-agricultural production it is not
envisaged that it will be an issue of concern in the foreseeable future.WT/ACC/VUT/7
Page 24
Question 60.
Could Vanuatu give further information on whether importation of the product incorporating
the patent invention satisfies local working?  In  what way is the obligation to work the patent
satisfied (reply to question 102 in document WT/ACC/VUT/4)?
Answer
The question is unclear and we seek formal clarification from the Working Party.
Layout designs (topographies) of integrated circuits
Question 61.
Does Vanuatu intend to introduce legislation regar ding the protection of layout designs?  What
is the time-frame (see question 103 in document WT/ACC/VUT/4)?
Answer
With the assistance of WIPO, Vanuatu will introduce TRIPS consistent legislation that will
provide protection for all recognised forms of intell ectual property.  All TRIPS consistent legislation
will be in place prior to accession.
Geographical indications
Question 62.
Does Vanuatu envisage introducing a system of protection for geographical indications?  What
is the possible time-frame (question 104 in document WT/ACC/VUT/4)?
Answer
With the assistance of WIPO, Vanuatu will introduce TRIPS consistent legislation that will
provide protection for all recognised forms of intell ectual property.  All TRIPS consistent legislation
will be in place prior to accession.
Industrial designs
Question 63.
Does Vanuatu envisage introducing protection?  What could be a possible time-frame
(question 106 in document WT/ACC/VUT/4)?
Answer
With the assistance of WIPO, Vanuatu will introduce TRIPS-consistent legislation that will
provide protection for all recognised forms of intell ectual property.  All TRIPS-consistent legislation
will be in place prior to accession.WT/ACC/VUT/7
Page 25
Trademarks and service marks
Question 64.
Does Vanuatu intend to amend the UK Trademarks Act No. 8 of 1982 in order to introduce the
obligations deriving from the TRIPS Agreement, Articles 15-21 (question 107 in document
WT/ACC/VUT/4)?
Answer
Yes, the Government of Vanuatu will repeal this legislation and introduce new
TRIPS-consistent trademark legislation that fulfils all of its obligations under the WTO.
Copyright and related rights
Question 65.
Which two acts is Vanuatu referring to in the answer to question 108 in document
WT/ACC/VUT/4?
Answer
The two acts referred to in question 108 are th e Registration of UK Trademarks Act No. 8 of
1982 and the Registration of UK Patents Acts (Cap.80) No. 11 of 1982.
Question 66.
Does Vanuatu intend to introduce protection for copyright and related rights?
Answer
Vanuatu intends to introduce TRIPS-consistent legislation which will protect copyright and
related rights.
Question 67.
Does Vanuatu intend to introduce protection of databases?
Answer
Vanuatu intends to introduce TRIPS-consistent legislation which will protect databases.
Enforcement
Question 68.
Does Vanuatu intend to introduce a system for enforcement of intellectual property rights as
foreseen in Part III of the TRIPS Agreement?WT/ACC/VUT/7
Page 26
Answer
Vanuatu intends to introduce TRIPS-consistent legislation which will enforce intellectual
property rights as foreseen in Part III of the TRIPS Agreement.
VI. TRADE-RELATED SERVICES REGIME
Question 69.
We have a number of concerns about the policies and procedures for issuing work and
residence permits:
(i) for residence permits, Vanuatu has indicated that issue of these permits is linked to
investment and that the length of stay is determined by the value of initial investment
(paragraph 14 of Factual Summary).  We consider it inappropriate to link the length of
stay with the value of the initial investment.  For the services sector and in a country the
size of Vanuatu, many instruments could be  expected to be relatively small scale.
However, we do not believe that the investment should be considered less “valuable” inany sense nor should it be assumed that it will be of shorter duration.  Will Vanuatu
consider changing these requirements with a view to improving the current situation?
(ii) it is unclear how other categories of foreign service suppliers gain residence permits.
For example, we believe that it is important that intracorporate transferees who are not
undertaking any independent investment be permitted to gain residence permits.  CanVanuatu clarify please?
(iii) we note that persons gaining residence permits are not automatically entitled to work
permits. Can Vanuatu clarify the procedures  and criteria for obtaining work permits?
(iv) there would appear to be a lack of transp arency and considerable discretion involved in
the process of obtaining and enforcing rights secured under both residence and workpermits.  Does Vanuatu intend to improve this situation?
Answer
(i) and (ii) There appears to be a misunderstanding about the requirements for receiving a work
permit for an employee and a similar work and residence permit for those beginning a business or
who are self-employed.  A resident and work permit for those who are employees or intracorporatetransferees does not require those employees to und ertake an investment in Vanuatu.  This is only
required from those who are starting a business in Vanuatu. As long as the employer can demonstrate
that there are no Ni-Vanuatu available with similar qualifications then a residence and work permit
will be granted.
(iii) Please under the revised draft Work Permit and Immigration Acts the right of residence and
work permits are automatic upon production of an approval certificate from the Foreign Investment
Board (please see draft amendments which are scheduled to go to Parliament in the first half of the
year, which are available in the Accessions Division, Room 1126 for consultation).  However, there
are a large number of people who reside in Vanuatu, as is the case in any country,  that do not seek
employment and should they seek employment this is, like in other countries determined on whether
there are any suitably qualified nationals.WT/ACC/VUT/7
Page 27
(iv) The Working Party will note that Vanuatu has greatly improved the rights of investors in the
draft revised legislation which is available in the Secretariat (Accessions Division, Room 1126) for
consultation.
Question 70.
Vanuatu has indicated that with respect to work  permits, amendments to the Labour Law will
provide greater transparency regarding requireme nts to invest in Vanuatu, limit the ministerial
discretionary powers as required in the existing Labour Act; establish long-term work permits
for those undertaking investments; and provide for genuine rights of appeal in disputes arising
over work permit decisions (paragraph 15 of Factual Summary).  We believe that it is
important that these amendments are implemented to the Labour Act and that Vanuatu
consider the scope for addressing the other concerns raised.
Answer
The Working Party will note the reforms enclosed in the draft Work Permits and Immigration
Act which will go before Parliament in July 1998 and which are available in the Secretariat
(Accessions Division, Room 1126) for consultation.
Question 71.
We have some concerns about the system of customary ownership.  Vanuatu has indicated that
all land in Vanuatu is owned by the indigenous population and that foreigners must negotiateleases on this land from the customary owners.  It was further noted that customary ownership
is complicated resulting from frequent disputes concerning ownership and boundaries and that
these are resolved by resort to customary law (paragraph 16 of Factual Summary).  While we
can accept the position that foreign investor s must lease land, we are concerned about the
difficulties that could be encountered in the processes for the negotiation of land leases andresolving disputes over customary ownership, and about the legal enforcement and protection
mechanisms available for the final lease agreement s.  Will Vanuatu consider means of codifying
these processes in a transparent and readily enfo rceable manner to facilitate foreign investment
in the services sector (for example, in tourism)?
Answer
Pending.
Financial services
Question 72.
We would appreciate advice on the new capital adequacy policies when they are available.  We
would like to strongly urge Vanuatu to base the capital adequacy ratios on Basel risk-weightedasset methodology and to ensure that these ratios  are implemented on a national treatment basis
(paragraph 68 of Factual Summary)?
Answer
Pending.WT/ACC/VUT/7
Page 28
Telecommunications
Question 73.
We note that Vanuatu does not currently have any plans to eliminate the monopoly of Telecom
Vanuatu Limited on communication services.  We would urge Vanuatu to consider the benefits
to business of eliminating this monopoly.  As a first step, Vanuatu could allow competition in
value-added telecommunication services (paragraph 69 of Factual Summary).
Answer
The Government of Vanuatu, with the assistance of the World Bank, is currently reviewing its
relationship with existing infrastructure service providers including telecommunications and
electricity.
Professional services
Question 74.
Could Vanuatu clarify the situation regarding residency permits for suppliers of professional
services?  Vanuatu has indicated that residen ce permits are not required for obtaining a licence
to practice a profession (paragraph 70 of Factual Summary).  However, in a previous version of
Vanuatu’s offer there was an entry for legal and accounting services stating that “where an
owner-manager is granted a business licence a residence permit will also be granted”.  Could
Vanuatu also clarify for which profession/services a “business licence” is required and indicatethe appropriate regulatory agency?
Answer
There appears to be some confusion about the requirements for work and residence in
Vanuatu. For an employee there is no requirement of obtaining a residence permit.  For example, a
doctor wishing to practice medicine in Vanuatu as an employee of a hospital does not require aresidence permit.  As long as the individual is not practising in an area that is reserved and there are
no suitably qualified Ni-Vanuatu then the foreign national will receive a work permit.  However in the
case of an foreign national who wishes to be self employed and, in the case above, open a private
medical practice then the resident will have to invest a minimum of Vatu 5 million (US$40,000) in
order to receive a residence permit.WT/ACC/VUT/7
Page 29
ANNEX I
(as in the format of Annex 3 of WT/ACC/1)
INFORMATION ON IMPORT LICENSING PROCEDURES
I. OUTLINE OF SYSTEM
Under the terms of the Import of Goods Control Act No. 19 of 1984 the Minister of Trade and
Industry has the authority to issue import orders and issue licences to control the importation of goodsinto Vanuatu.
Licences to import firearms and ammunition are issued by the Commissioner of Police.
Licences/permits for the import of live animals and plants, as provided by the Plant Protection
Act and Animal Importation and Quarantine Act, require licences to be issued by the Head of
Quarantine. In the case of the importation of plants, licences are issued by the Head of the Vanuatu
Quarantine service and in the case of the importation of live animals, licences can be issued by the
Veterinary Officer.
Licences/permits for the import of alcohol are controlled by the Municipal Clerk and the
Ministry of Finance.
II. PURPOSES AND COVERAGE OF LICENSING
1. Product coverage:- Import of Goods Control Act;
- T-shirts and singlets bearing a Vanuatu motif or logo;
- rice, flour, canned mackerel, sugar and tobacco products;
- import of firearms and ammunition  covers all such products;
- import of animals and plant products covers all such products; and,
- import of alcohol.
2. The system applies to all imports irrespective of origin.
3. Purpose of system:
- Import of Goods Control Act,
- T-shirts and singlets bearing a Vanuatu motif or logo:
The import of these products are banned in order to protect domestic producers.
- Rice, flour, canned mackerel, sugar and tobacco products:
The import licence for these products is issued following the payment of a 3-4 per cent
commission to the Vanuatu Co-operative Federation (Vanuatu is committed to repeal this as a
condition of accession).
- Import of firearms and ammunition covers all such products:
Protection of civil society.  No alternative measure is envisioned or acceptable.WT/ACC/VUT/7
Page 30
- Import of animals and plant products covers all such products:
Protection of human and animal health and the environment. No alternative measure is
envisioned or acceptable.
- Import of all spirits:
Protection of human health.  The restrictions ar e aimed at HS Classification 22.08, i.e. spirits.
4. Legal basis:- Import of Goods Control Act,
- T-shirts and singlets bearing a Vanuatu motif or logo:
- Import of Goods Control Order No. 47 of 1986.
- Rice, flour, canned mackerel, sugar and tobacco products:
- Import of Goods Control Order No. 28 of 1987.
- Import of firearms and ammunition covers all such products:
- The Firearms Act No. 7 of 1987
- Import of animals and plant products covers all such products:
- Plant Protection Act,
- Animal Importation and Quarantine Act,
- Import of Alcohol is covered under th e Liquor Licensing Act [CAP.52].  Alcohol
Importation Act [Cap. 8].
This system cannot be abolished without legislative changes approved by Parliament.
III. PROCEDURES
1. There are no quantitative restrictions in Vanuatu except for the ban on the import of T-shirts
and singlets.  There are no quantitative restrictions on the importation of alcohol.
2. Type of commodity- Rice, flour, canned mackerel, sugar and tobacco products:
Import licences are granted immediately upon presentation of the receipt of payment of
Commission from the Vanuatu Cooperative Federation. There are no limitations on seasonal imports.
The importer must approach VCF and then, upon payment of commission is automatically granted an
import licence (Vanuatu has agreed to abolish this system as a condition of  accession).
- Import of firearms and ammunition:
Licence is issued by the Commissioner of Police upon satisfactory justification for the need to
import such items.  Right of ownership of a firearm is not automatic in Vanuatu.  The import licenceWT/ACC/VUT/7
Page 31
is then presented to customs upon clearance.  The issuance of such licences are very uncommon in
Vanuatu and there is no rapid process for receiving such a licence
- Import of plant materials:
Licences are granted upon completion of a pest risk analysis.  The importer then obtains a
permit to import which certifies the criteria and conditions for import which are then to the exporting
country.  Once these conditions are met in the exporting country a phytosanitary certificate certifyingcompliance with the conditions of the import permit is issued.  Upon arrival the goods are inspected to
assure compliance with the conditions in the import permit.
- Import of live animals:
The importation of live animals into Vanuatu requires an import licence/permit.  This is
obtained from the animal health service of the Department of Livestock
- Import of alcohol:
This licence is issued by the Clerk of the Muni cipality in which the importer is resident under
the provisions of the Liquor Licensing Act.  The importation of alcohol under the Alcohol Importation
Act is regulated by the Ministry of Finance.
3. An applicant will receive an import permit if he/she meets criteria stipulated in the legislation.
Failure to receive an import licence is not normally  accompanied with a written explanation for the
reason for the denial.  The methods of appeal that are normally available in Vanuatu firstadministrative via the respective Director General of the relevant department.  If such administrative
redress is unacceptable then there exists the right of legal redress in the event of denial of rights under
Vanuatu Law.
IV. ELIGIBILITY OF IMPORTERS TO APPLY FOR LICENCE
All persons, firms and institutions are eligible for a licence under non-restrictive systems.
There are no registration fees.  No published list of authorised importers is published in Vanuatu.
VI. DOCUMENTATION AND OTHER REQUIREMENTS FOR APPLICATION FOR
LICENCE FEE
1. Rice, flour, canned mackerel , sugar and tobacco products:
(i) a sample application form is enclosed in Annex 1;(ii) at importation the licence reference must be quoted which can then be verified from customs
records. The usual documentation such as a bill of lading and invoices are also required;
(iii) there are no licence fees or administrative charge;
(iv) there are no advance payment requirements associated with the issue of licences.
2. Importation of firearms and ammunition:(i) a sample application form is enclosed in Annex 1;WT/ACC/VUT/7
Page 32
(ii) at importation the licence reference must be quoted which can then be verified from customs
records.  The usual documentation such as a bill of lading and invoices are also required;
(iii) the import licence fee is ...;
(iv) there are no advance payment requirements associated with the issue of licences.
3. Importation of plants and live animals:
(i) a sample application form is enclosed in Annex 1;(ii) at importation the licence reference must be quoted which can then be verified from customs
records. The usual documentation such as a bill of lading and invoices are also required;
(iii) the import licence fee is ...;
(iv) there are no advance payment requirements associated with the issue of licences.
4. Import of alcohol:
(i) sample application forms are enclosed in Annex 1;
(ii) at importation the licence reference must be quoted which can then be verified from customs
records.  The usual documentation such as a bill of lading and invoices are also required;
(iii) there is no import licence fee from the either the municipality or from the Ministry of
Finance;
(iv) there are no advance payment requirements associated with the issue of licences.
VII. CONDITIONS OF LICENSING
1. Licences are not limited by period unless so requested by the applicant.
2. There is no penalty for non-utilization of a licence.
3. Licences are not transferable between importers.
4. There are no quantitative restrictions and there are no other conditions, apart from the
conditions of import and the description of the product.
VIII. OTHER PROCEDURAL REQUIREMENTS
1. There are no other administrative procedures required prior to importation.2. There are no foreign exchange controls in Vanuatu.WT/ACC/VUT/7
Page 33
ANNEX II
(as in the format of Annex 4 of WT/ACC/1)
INFORMATION ON IMPLEMENTATION AND
ADMINISTRATION OF THE CUSTOMS VALUATION AGREEMENT
1. Questions concerning Article 1:
(a) Sales between related persons:(i) Are sales between related persons subject to special provisions?
The value for customs purposes is the c.i.f. value which would be taken as the price which
they would fetch on a sale in the open market between an independent buyer and seller.  Sales
between related persons where the price may not represent an acceptable value for customs purposes
and if the invoice price is less than the price which would be charged to an independent customer, the
latter price, adjusted to the c.i.f. level becomes the acceptable level.
(ii) Is the fact of intercompany prices prima facie considered as grounds for regarding the
respective prices as being influenced?
No, under existing customs valuation practice in Vanuatu such a conclusion must be covered
by sufficient evidence.
(iii) What is the provision for giving the communication of the afore-mentioned grounds in
writing if the importer so requests?
There is no provision in the current legislation bu t this will be included in a future change to
the valuation rules to comply with WTO requirements.
(iv) How has Article 1.2(b) been implemented?
The fact that a buyer and seller are related is not grounds for regarding the transaction value
as unacceptable.  It has to be examined and unless customs have information  that this is not the casethen the transaction value shall be employed for calculating the value for duty (VFD).
(b) Price of lost or damaged goods?
Are there any special provisions or practi cal arrangements concerning the valuation of
lost or damaged goods?
There are no special provisions concerning the valuation of lost of damaged goods but the
practical arrangements are that the value for customs purposes is for the importation of goods
supposing that all goods are being imported with no loss or damaged goods.  Should this happen,
there is a calculation of the unit c.i.f. value of the lost or damaged goods which is then deducted from
the original value to arrive at the new c.i.f. value.
2. How has the provision of Article 4 to allow the importer an option to reverse the order
of application of Articles 5 and 6 implemented?
This is not currently provided under the existing  customs regulations but will be covered
under any revised rules.  Those rules when drawn up will comply with the provisions of Articles 4, 5
and 6.WT/ACC/VUT/7
Page 34
3. How has Article 5.2 been implemented?
Whilst the current Vanuatu provisions do not cover such a situation, in practice should such a
situation arise, the rules of Article 5.2 will apply.  In our future revision of the valuation regime this
will be bring the customs valuation regime into conformity with Article 5.2.
4. How has Article 6.2 been implemented?
Whilst the current Vanuatu provisions do not cover such a situation, in practice should such a
situation arise the rules of Article 6.2 will apply.  In our future  revision of the customs valuation
regime this will be in conformity to Article 6.2.
5. Questions concerning Article 7:
(a) What provisions have been made for making value determinations pursuant to
Article 7?
There are no present provisions but we undertake to comply with this provision when revising
the customs valuation regime.
(b) What provision for informing the import er of the customs value determined under
Article 7?
Not provided under the present regime but we undertake to comply with the provisions of  the
WTO Agreement when revising the customs valuation regime.
(c) Are the prohibitions found in Article 7.2 delineated?
We agree with the provisions of 7.2 and whilst this is not covered in our current legislation
this is to be complied with in our revision exercise.
6. How have the options found in Article 8.2 been handled?  In the case of f.o.b. application
are ex-factory prices also accepted?
Vanuatu’s value for custom purposes is based on cost, insurance and freight and will continue
to do so in the future.  Where goods are not sold on c.i.f. terms, additions have to be made to the
invoice to bring it up to the level of the c.i.f. price.  These additions include packing, carriage to and
charges at port of shipment, foreign duties and taxes, freight and insurance, commissions or other
remuneration, royalty or licence fees, tooling or design costs and inspection fees, cost of materials,
equipment or services provided by the importer, or on his behalf, in connection with the production,purchase, delivery or resale of the goods.
7. Where is the rate of exchange published, as required by Article 9.1?
The conversion rate is published by customs and is available 7 days before the application of
the rates and are changed when there is an exchange rate variation of 3 per cent of the customs
published rate vis-à-vis the buying and selling commercial rate.
8. What steps have been taken to ensure confidentiality, as required by Article 10?
This is an integral part of our client relations and all such documents are covered under the
provisions of staff regulations and official secrets regulations.  Under these regulations staff members
of the Vanuatu Customs Service are prohibited from disclosing confidential information except in the
case of a judicial or criminal investigation.WT/ACC/VUT/7
Page 35
9. Questions concerning Article 11:
(a) What rights of appeal are open to the importer or any other person?
The Vanuatu judicial process provides for compliance to Article 11.
(b) How is he to be informed of his right to further appeal?
This is also through the judicial process.
10. Provide information on the publication, as required by Article 12, of:
(a)(i) the relevant national laws;
The laws of Vanuatu, including customs valuat ion are published by the Government and are
publicly available.  The laws of Vanuatu do not come into force until such time as they are published.
(ii) the regulations concerning th e application of the Agreement;
The current customs regulations are published and when they are revised to be brought into
conformity with the obligations of the  CVA they will be published.
(iii) the judicial decision and administrative rulings of general application relating to the
Agreement;
The judicial decision of the courts are all published.
(iv) general or specific laws being referred to in the rules of implementation or application.
All general and specific laws are published in Vanuatu.
(b) Is the publication of further rules anticipated?  Which topics would they cover?
No.
11. Questions concerning Article 13:
(a) How is the obligation of Article 13 (last sentence) being dealt with in the respective
legislation?
The current legislation covers such a situation but in practice an importer at present  can
release goods from customs with prior payment of duty and also an undertaking to pay any
outstanding balance in the event of a valuation being greater than transaction value. These WTO
obligations will be fully met when the  Customs Act is revised to render it compatible with CVA.
(b) Have additional explanations been laid down?
No.
12. Questions concerning Article 16:
(a) Does the respective national legislation contain a provision requiring customs
authorities to give an explanation in writing as to how the customs value was
determined?WT/ACC/VUT/7
Page 36
There are none at present but Vanuatu  undertakes to comply with WTO requirements when
new legislation is drawn up in this area. In all future legislation the importer shall have recourse to the
rights found in Article 16.
(b) Are there any further regulations concerning as above-mentioned request?
No.
13. How have the Interpretative Note s of the Agreement been included?
The substance of the Interpretative Notes of Annex I have not been included but this will be
done when Vanuatu legislation is brought into conformity with its WTO obligations.
14. How have the provisions of the Decision of 26 April 1984 on the Treatment of Interest
Charges in the Customs Value of Imported Goods (Val/6/Rev.1) been implemented?
Pending.
15. For those countries applying paragraph 2 of the Decision of 24 September 1984 on the
Valuation of Carrier Media Bearing Softwa re for Data Processing Equipment (Val/8),
how have the provisions of this paragraph been implemented?
Pending.WT/ACC/VUT/7
Page 37
ANNEX III
(as in the format of Annex 6 WT/ACC/1)
QUESTIONNAIRE ON STATE TRADING
I. ENUMERATION OF STATE TRADING ENTERPRISES
The Government of Vanuatu operates only one State-trading company as defined in the
GATT - the Vanuatu Commodity Marketing Board (VCMB).  The VCMB is not formally owned by
the Government but by the growers who are the ma jority representatives on the board of directors.
The only entity permitted to export copra and cocoa.  It also issues licences to Ni-Vanuatu exporters
to export kava.  There are currently 25 such licences.
II. REASON AND PURPOSE FOR INTRODUCING AND MAINTAINING
STATE-TRADING ENTERPRISES
There are two reasons why the Government of Vanuatu has operated a State-trading company
for these three products:
1. These products are all produced largely by Ni-Vanuatu small holders who, prior to
independence, often received low prices in comparison to the prevailing market prices.  The VCMBwas thus in part established to  prevent monopolistic practices in commodity trade in small and far
flung islands.
2. The Government wanted to ensure that those living on the most distant and remote islands
were not penalised by extremely high transport costs.  To alleviate this the Government instituted asystem of cross-subsidies to lower internal transport costs to main costs.
3. In the late 1970’s, Vanuatu copra began to acquire a reputation for low quality and high levels
of aflatoxin. One of the main purposes of the VCMB has been to try to assure the quality of copra so
as to maintain the prices received on  world markets.
4. The Government of Vanuatu wanted to operate a system of price supports using the facilities
that were available under the Stabex Fund from the European Communities under the LoméConvention.
This system of stabilisation only exists for copra now. The stabilisation system for cocoa has
been abolished and prices are set purely by market rates. The copra stabilisation it is largely
self-financing based on the levies of the VCMB being repaid to farmers when prices are low.
III. DESCRIPTION OF THE FUNCTIONING OF STATE-TRADING ENTERPRISES
1. Copra and Cocoa
The VCMB buys and exports all of Vanuatu’s copra.  Prices are established on the basis of a
relatively fixed price which is linked to the pr evailing market prices as published by FOSFA for
copra.  A break-even analysis for the company show ing the return to VCMB for copra is available in
the Secretariat (Accessions Division, Room 1126) for consultation.  The surplus in the break even
analysis is held in  a buffer  in the event that the market prices drives copra below Vatu 26,000 per
ton.  However, when the buffer fund is exhausted the company has no further resources and internal
farm gate prices are adjusted to world market levels.  The VCMB Act 1982 [Cap.133] Section 6(2)
states:WT/ACC/VUT/7
Page 38
"In carrying out its functions under this Act, the Board shall so conduct its affairs as
to avoid any need to rely on government grants and subsidies".
The company receives no subsidy from the Government.  It does however receive ad hoc
payments from the European Communities’ Stabex Fund when the Government decides that this is
justifiable by virtue of the world copra price.  In 1996 the VCMB received Vatu 100 million from
Stabex  which is 8 per cent of 1996 exports of copra.
For cocoa, the VCMB trades directly at free market prices and there is no stabilisation fund as
exists with copra.
Long term contracts are not negotiated at fixe d prices and State-trading methods are not used
to fulfil contractual obligations entered into by the Government.
2. Kava
The VCMB does not formally market kava but simply licences and controls the trade.  In
1997 there were 25 licensed traders who pay 7.5 per cent of the value of their exports to the VCMB ascommission.
IV. STATISTICAL INFORMATION
Below are the volume and value of Vanuatu copra, cocoa and kava exports. The VCMB
exports 100 per cent of the first two crops and issues licences and receives 7.5 per cent commission on
100 per cent of the export of kava.
Copra
(tons)Copra
(vatu millions)Cocoa
(tons)Cocoa
(vatu millions)Kava
(tons)Kava
(vatu millions)
1994 26441 894 1706 226 85 57
1995 28520 1100 1035 126 52 48
1996 30026 1240 1247 165 64 73
Source:  Statistics Office, VanuatuWT/ACC/VUT/7
Page 39
ANNEX IV
EXPLANATION OF THE PROHIBITED/RESTRICTED PLANTS LIST
GOVERNMENT OF THE REPUBLIC OF VANUATU
Department of Agriculture and Horticulture
Plant Protection and Quarantine Division
The following list of prohibited plants and materials is based on current knowledge of the
importance and distribution of plant pests and diseases in relation to Vanuatu’s present and potential
agricultural base.  As knowledge increases and/or there are changes in pest distributions, commodities
may be withdrawn from the list or new ones added.  Prohibition includes live plants, fruit, seed, leaves
and other parts either green or dried unless otherwise stated.
Plants and plant products not specifically mentioned on this list are permitted to enter
Vanuatu under quarantine control: i.e., with a provisional import permit from the quarantine service, a
phytosanitary certificate from the country of origi n, treatment at source if specified in the permit,
inspection on arrival, consequent release with or without treatment or destruction as necessary.
Aroids Taro Family including Caldium - Arum - Anthurium - Calla - Alocasia
and Colocasia and many ornamentals
Most important subsistence food crops in Vanuatu.  Taro and other aroids can be affected by
many extremely serious diseases and pests; viruses such as alomae, bobone and dasheen mosaic
(DMV); fungus diseases such as Phytophthora  leaf blight and Pythium  root rot; insects such as
Papuana beetle and various nematodes.  These pests and diseases are not found in all parts of the
region. For example, alomae, bobone and 29 fungal diseases of taro that are present in the Solomon
Islands have not been recorded in Vanuatu.  The status of virus diseases of related ornamentals isunknown and these plants could only be imported as virus-free tissue cultured material from an
internationally approved supplier.
Aquatic plants Except for known safe species
These may become weeds of waterways, such as water hyacinth which has already been
introduced to Vanuatu.  Other dangers would be fr om bulrushes brought as ornamentals or ‘Kariba
weed’ ( Salvinia molesta ) an aquatic fern whose spores can survive desiccation and be transported on
the hulls of boats.  Ballast water from ships could be a source of exotic toxic dinoflagellates and
marine algae.
Avocado Persea  species
A common cash crop with export potential, already regularly traded to New Caledonia. Fresh
fruit from neighbouring countries, especially Australia, could harbour fruit fly species not present in
Vanuatu. Stem-end rot, which has characteristic symptomology, ( Dothiorella aromatica ) has not been
recorded in Vanuatu.
Banana Musa  species
This is a major subsistence crop in Vanuatu.  Devastating diseases are present in Fiji and
Australia. Both countries have Banana bunchy top virus (BBTV) for which there is no treatment.  It
causes severe stunting and death of banana trees.  All planting material is banned.  Another virusWT/ACC/VUT/7
Page 40
disease, banana streak, is not present in the region.  In Fiji there is a serious bacterial disease called
Moko which could be carried on any part of the plant including fruit. Panama disease (a Fusarium
wilt) is present in Australia but not Vanuatu. It can kill all tall cultivars. These diseases can also be
carried by related plants in the Heliconiaceae (Heliconias) and the Zingiberaceae (Ginger and related
ornamentals).
Breadfruit Artocarpus  species  (includes Jackfruit and Breadnut)
Host for some fruit fly species. Disease status insufficiently researched.
Cacti Some Opuntia  and Harrisia  species
Possible carriers of viruses.
Cassava  Manihot esculenta , Manioc
An important staple food crop in Vanuatu. Many pests and diseases found elsewhere in the
region have not been recorded from Vanuatu.  For example the fungus Phoma tropica recorded from
Fiji and the Solomon Islands; the nematode, Hemicriconemoides  found in Papua New Guinea, Fiji,
Western Samoa and Kiribati.  There are 12 nematode pests and 5 fungi of cassava recorded in Fiji but
not from Vanuatu; 4 fungi and 1 nematode found on cassava in the Solomon Islands have not been
found here.
Citrus  Except  fruits from reputable sources (Australia and New Zealand)
Citrus fruits are hosts of exotic fruit flies. Of particular danger on produce of Australian
origin is Queensland fruit fly: commercial shipments that are certified free of quarantine pests are
permitted; private imports from supermarkets are liable to be destroyed. Planting material only
permitted if certified free of Tristezia  virus and bacterial canker (e.g. from Corsica) and initially
grown in quarantine isolation. Vanuatu is free of these major diseases.
Cocoa Theobroma cacao  - except processed
Vanuatu is virtually pest and disease free for this crop, enabling “green” chemical free
production. e.g. Fiji records 12 nematodes and 10 fungi, and the Solomon Islands 16 fungi and 2
bacteria that are not known from Vanuatu.
Coconut Cocos nucifera - except processed
Coconuts are Vanuatu’s most important cash crop.  Recent research has shown that coconuts
and other palms in the Asia-Pacific Region contain a range of viroid-like particles, e.g. all exoticcoconuts grown in Vanuatu die as they are not resist ant to the local virus. Until more is known about
the pathogenicity of these particles, all international movement of palms is halted.  Tissue culturedmaterial is not available as yet.  Two lethal diseases of coconuts, Kadang Kadang in the Philippines
and Lethal Yellowing in Africa and the Americas are extremely serious but geographically distant.
The Solomon Islands has two serious pests that do not occur in Vanuatu; a sucking bug, Amblypelta
cocophaga  that causes premature nut fall and the New Guinea rhinoceros beetle Scapanes australis  .
Other pests absent from Vanuatu, but widespread in the region are Aleurodicus dispersus  (spiralling
whitefly), Chrysomphalus aonidum  (Florida red scale) and Pinnaspis buxi  (coconut scale).  The mite,
Aceria guerreronis  , is a pest of quarantine importance present outside the region.  There are many
fungal and nematode pathogens attacking the leaves and stems of coconuts, but only a few are likelyWT/ACC/VUT/7
Page 41
to occur in fruit; however, they could be pres ent on artifacts of coconut wood and leaf, e.g.
Marasmiellus cocophilus  (lethal bole rot) and M. inoderma  (seedling blight).
Coffee Coffea  spp. - except processed
Vanuatu is free of the major pest Hypothenemus hampei  (coffee berry borer) which is present
in New Caledonia, Africa and Central America. Import of green coffee beans could bring coffee berrydisease ( Colletotrichum coffeanum ) from Africa and Mycena  leaf spot from the Americas.
Cotton Gossypium  spp. - except processed
The four major pan-tropical diseases of cotton, wet weather blight, Fusarium  wilt,
Verticillium  wilt and bacterial blight are not recorded in Vanuatu. Cotton probably spread across
Oceania over 2000 years ago. G. barbadense  is found widely in Vanuatu, both wild and as an
ornamental.  This is the prized “Sea Island” variety which was commercially produced in the 1860s
and from 1910-1938. Globally, more pesticides are sprayed on cotton than any other crop, but only
one disease has been isolated from cotton in Vanuatu. The ban is to protect this disease-free status for
the future when world cotton prices may be higher and Vanuatu labour costs lower.
Ginger All members of the Family Zingiberaceae   - except processed
Ginger is an important cash crop in parts of Vanuatu. Not all pests and diseases are equally
distributed in the region. For example, Fiji has 19 nematodes and fungi on ginger that have not been
recorded on this crop in Vanuatu. Viruses occur in the family and information on these is sparse, but
they could be transmitted from the unprocessed cu linary material as it can be planted and grown. This
family includes a large number of ornamentals that would only be permitted entry as certified disease
free tissue cultured material. The family is also a host of some banana pathogens.
Heliconia All members of the family Heli coniaceae except as pathogen-tested tissue
cultures
This family is closely related to the Musaceae and is a host to many of the serious banana
pests and diseases. See ‘Banana’ above.
Kava Piper methysticum -  except processed
A very important cash crop in Vanuatu. The pests and diseases of the species have not been
studied in the region and all parts of the plant are prohibited except for dried and powdered root.There is a risk of pests adapting to Piper nigrum .
Mango Mangifera indica  - except processed. Fresh fr uit or plants only possible
under stringent controls
Fresh fruit are hosts for numerous fruit flies.  Within the region the following are found that
do not occur in Vanuatu: Bactrocera bryoniae, B.cucurbitae , (melon fly), B. dorsalis  (oriental fruit
fly), B. facialis , B. frauenfeldi  (mango fly), B. frenchi,  B. froggatti,  B. jarisi, B. kirki, B. melanotus,
B. passiflorae, B. psidii, B. tryoni   (Queensland fruit fly). Ceratitis capitata  (Mediterranean fruit fly)
which is present in Western Australia and Hawaii.  All consignments of fruit need approved treatment
or certification that they originated from a fruit fly-free area.  There are many other important insects,
especially scales, mealybugs, moths, weevils, thrips and mites, which are pests of the leaves, stems
and fruit of mango, e.g. Noorda albizonalis  (red-banded mango caterpillar) which damages the fruit
and has a restricted distribution in the region.  Other pests of quarantine importance are Aleurodicus
dispersus  (spiralling whitefly), Idioscopus clypealis  (mango hopper) and Sternochetus frigidusWT/ACC/VUT/7
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(mango weevil).  Anthracnose, caused by the fungus Colletotrichum gloeosporioides , infects fruits,
and is already widely distributed.  However, strains from different locations have widely varying
pathogenicity.
Vegetative importations are only possible under the supervision of the Quarantine services
and should be limited to small quantities of budwood.
Palm  plants Family Palmaceae
All imports of palm trees or fruits or living parts thereof are prohibited until the viroid
situation is better understood. See ‘coconut’ above.
Passion Fruit Passiflora  spp. - except processed or pathogen tested germplasm certified
disease free
A developing cash crop in Vanuatu. A host of fruit flies. Danger of Batrocera tryoni  on
Australian produce.  Presently free of the major fruit and leaf diseases and pests found elsewhere, e.g.
the passionvine bug ( Leptoglossus australis ), Septoria spot ( Septoria passiflorae ), Phytophthera blight
(Phytophthora nicotianeae ), woodiness virus, scab or base rot, all found in  Australia.
Paw Paw Carica papaya
The commonest fruit tree in Vanuatu. A potential host for exotic fruit flies. Budwood could
carry viruses such as bunchy top and mosaic and their insect vectors.
Pepper plants Piper  species, except as pathogen tested germplasm
There are about 8 species of Piper  in addition to P. nigrum  (black pepper) originating in the
Afro-Asia region and used as spices.  Also widely spread is the betel pepper, Piper betle , which
occurs wild here and is occasionally cultivated.  Black pepper is a common cash crop in Vanuatu with
considerable potential for future expansion.  The prohibition is to protect this industry from exotic
pests and diseases.  There is a risk of pests adapting to Piper  methysticum .
Pineapple Ananas  species
An important cash crop in Vanuatu that suffers few diseases, e.g. there are 3 fungal pathogens
in the Solomon Islands and 19 nematodes and fungi in Fiji that do not occur on pineapples in
Vanuatu.  It is also a host of exotic fruit flies in other countries.
Rice Except processed grain
Paddy rice, rice hulls and bran can harbour serious pests that have not yet found their way to
Vanuatu. Foremost amongst these would be Trogoderma graminarium , the khapra beetle, which
attacks both live plants and stored products.  Polished rice from some parts of Asia should be
fumigated at source.  Contaminated shipments will be destroyed on arrival.
Sugarcane Saccharum  spp.
Sugarcane, Saccarum offinarum , is a common constituent of the traditional mixed garden
together with ‘naviso’, Sacchurum edule .  Although about 20 diseases and several insects attack
sugarcane in Vanuatu, none of these are too serious. The debilitating diseases, bacterial ratoon stunt,
and mosiac virus have not been recorded.  They must be excluded.WT/ACC/VUT/7
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Sweet potato Ipomoea batatas    Except pathogen tested tissue cultures
Ipomoea batatas  is an important subsistence crop in Vanuatu. Several fungal diseases and
nematodes occur in neighbouring States but not in Vanuatu; e.g. 2 species in the Solomon Islands,
about 20 in Fiji and over 35 in Papua New Guinea.  The sweet potato weevil, Cylas formicariuis , is a
very serious pest that is found widely throughout the tropics and in all South Pacific States except
Nauru, Pitcairn, Tokelau and Vanuatu.
Taro Except pathogen tested tissue cultures
See ‘Aroids’ above.
Timber Including bamboo and parts of trees, except processed  and treated
The timber industry is of considerable importance to Vanuatu with a good potential for
increased plantation production in the future.  Timber consists of many forms:  logs, rough-cut and
dressed timber, furniture, prefabricated parts of houses, packing cases, wooden handicrafts,
reconstituted timber products and dunnage. There is a serious quarantine risk, particularly of insectsthat attack timber, logs and forest trees.  The quarantine risk is substantially increased if bark, leaves,
seed pods, pine cones, etc. contaminate the consignment. Bark provides an excellent habitat for many
insects and pathogens, some of which may attack other crops.  The following timber pests have not
been found in Vanuatu but occur in countries from which timber may be imported; the termites
Coptotermes formosanus , C. acinaciformis, Cryptotermes brevis , C. cynocephalus and Mastotermes
darwiniensis ; the boring beetles Hylotrupes bajulus, Stromatium bar-batum  and several species of
ambrosia beetles ( Xylotrupes  and Platypus  spp.) and the powder post beetles Heterobostrychus
aequalis, Dinoderus minutus  and Sinoxylon anale . Wood wasps, mahogany shoot borer and carpenter
ants have not been recorded in Vanuatu.
Several fungal pathogens cause root, butt and stem rots of trees and leaf blights and could be
spread in bark attached to timber and logs, e.g. Ganoderma  spp. and Rigidoporus  spp. Consignments
of timber and logs could also harbour rodents,  snakes and snails. Sawn timbers and manufactured
hardwood products are permitted if suitably treated at source.
Tobacco Except processed
Tobacco is a traditional garden crop grown for local use. It is largely disease free and the
prohibition is to protect this status and other Solanaceous crops for which tobacco can be an
alternative disease host.
Yams  Except pathogen tested tissue culture
Several pests and diseases of this major Vanuatu crop that are found in neighbouring
countries do not occur here. New germplasm can only be imported as tissue cultured material fromrecognised laboratories. Related ornamentals in the family Dioscoreaceae are also banned unless
certified virus free. Some pests have a restricted regional distribution.
Other plants and plant products
Since early 1993 there has been a total ban on fresh lychi fruit from Australia and New
Caledonia because of persistent and heavy infestation with fruit fly on intercepted imports. Fresh
lychis are only permitted from fruit-fly free countries.WT/ACC/VUT/7
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Soil
Soil from all origins is a very dangerous contaminant that can harbour nematodes, fungi,
mites, insects, molluscs and weeds. It is prohibited in all forms. Second hand vehicles, bicycles,
motorbikes, sports goods and shoes brought to Vanuatu must be clean or they will be seized and
cleaned at the owners’ expense. Permitted plants must be imported bare-root or as cuttings.
Straw Hay - Chaff - Rice straw
Straw is sometimes used as packaging, particularly for fragile items from Asia and China.
Frequently the grasses used are weeds and contain mature seed heads as well as harbouring a range of
pests. All imported straw will be destroyed.
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