WORLD TRADE ORGANIZATION
ORGANISATION MONDIALE DU COMMERCE
ORGANIZACIÓN MUNDIAL DEL COMERCIOWT/TPR/M/102/Add.2
31 March 2003
(03-1797)
Trade Policy Review Body
24 and 26 July 2002
TRADE POLICY REVIEW
EUROPEAN UNION
Minutes of Meeting
Addendum
Chairperson:  H.E. Ms Amina Chawahir Mohamed (Kenya)
This document contains the advance written questions, and replies provided by the European
Commission.1 It replaces the document WT/TPR/M/102/Add.1.
__________________________________________________________________________________
Organe d'examen des politiques commerciales
24 et 26 Juillet 2002
EXAMEN DES POLITIQUES COMMERCIALES
UNION EUROPÉENNE
Compte rendu de la réunion
Addendum
Président:  S.E.  Mme Amina Chawahir Mohamed (Kenya)
Le présent document contient les questions écrites communiquées à l'avance et les réponses
fournies par la commission européenne.1  Il remplace le document WT/TPR/M/102/Add.1.
__________________________________________________________________________________
Órgano de Examen de las Políticas Comerciales
24 y 26 de julio de 2002
EXAMEN DE LAS POLÍTICAS COMERCIALES
UNIÓN EUROPEA
Acta de la reunión
Addendum
Presidente:  Excma. Sra. Ami na Chawahir Mohamed (Kenya)
En el presente documento figuran las preguntas presentadas anticipadamente por escrito,
junto con las respuestas facilitadas por la comisión europea.1  Reemplaza el documento
WT/TPR/M/102/Add.1.
                                                     
1 In English only/ en anglais seulement/ en inglés solamente.WT/TPR/M/102/Add.2
Page 3
CONTENT: ARGENTINA, AUSTRALIA , BRAZIL, CANADA, CHILE, CHINA,
COSTA RICA, GUATEMALA
Topic Page Argentina Australia Brazil Canada Chile China Costa
RicaGuatemala
I. ECONOMIC
ENVIRONMENT9
(1) POLICY DEVELOPMENTS 9
(i) Economic and monetary
union (EMU)9
(ii) Structural reforms 10 /g252
(2) DEVELOPMENTS IN TRADE 10
(i) Commercial services trade 10 /g252
II. TRADE POLICY
REGIME : FRAMEWORK
AND OBJECTIVES12
(1) GENERAL FRAMEWORK 12
(i) Institutional framework 12 /g252
(ii) Transparency and public
consultations13 /g252
(2) ENLARGEMENT 15 /g252
(3) COMMON COMMERCIAL
POLICY17
(i) Instruments 17 /g252/g252
(4) EXTERNAL TRADE
RELATIONS19
(i) WTO 19 /g252
(ii) Bilateral and regional trade
relations21/g252/g252/g252 /g252 /g252
III. TRADE POLICIES AND
PRACTICES BY MEASURE33
(1) MEASURES DIRECTLY
AFFECTING IMPORTS33
(i) Customs procedures 33 /g252/g252
(ii) Customs valuation 37
(iii) Rules of origin 37 /g252/g252
(iv) Community tariff 39/g252/g252 /g252
(v) Indirect taxes 43 /g252
(vi) Prohibitions, restrictions,
surveillance, and licensing
requirements46 /g252/g252 /g252 /g252
(vii) Safeguard measures 55/g252/g252 /g252 /g252
(viii) Product regulations and
standards59/g252/g252/g252 /g252 /g252 /g252 /g252
(ix) Government procurement 130 /g252/g252 /g252
(x) State-trading 136
(xi) Anti-dumping and
countervailing measures136 /g252/g252 /g252
(2) MEASURES DIRECTLY
AFFECTING EXPORTS145
(i) Exports subsidies 145/g252/g252
(3) MEASURES DIRECTLY
AFFECTING PRODUCTION AND
TRADE146WT/TPR/M/102/Add.2
Page 4
Topic Page Argentina Australia Brazil Canada Chile China Costa
RicaGuatemala
(i) Legal framework for
business146 /g252/g252
(ii) Competition policy 147 /g252/g252
(iii) Subsidies 149 /g252/g252
(iv) Intellectual property
rights protection152 /g252/g252 /g252 /g252
IV. DEVELOPMENTS IN
SELECTED SECTORS166
(1) AGRICULTURE 166
(i) Main characteristics 166 /g252/g252
(ii) Common Agricultural
Policy (CAP)167/g252/g252/g252 /g252 /g252
(iii) CAP and Enlargement 177 /g252/g252
(iv) Developments in selected
subsectors179/g252/g252/g252 /g252 /g252
(2) FISHERIES 194
(i) Common Fisheries Policy
(CFP)194 /g252/g252 /g252
(3) FINANCIAL SERVICES 198
(i) Main characteristics 198 /g252
(ii) Policy developments 199
(4) TELECOMMUNICATIONS 204
(i) Policy developments 204
(5) E-C OMMERCE 206
(i) Main characteristics 206 /g252/g252
(ii) Policy developments 207 /g252/g252/g252
(6) OTHER SERVICES SECTORS 213 /g252
Annex 226WT/TPR/M/102/Add.2
Page 5
CONTENT: HONG KONG CHINA, INDIA, JAPAN, KOREA, MALAYSIA, MEXICO,
NEW ZEALAND
Topic Page HK,
ChinaIndia Japan Korea Malaysia Mexico New
Zealand
I. ECONOMIC ENVIRONMENT 9 /g252
(1) P OLICY DEVELOPMENTS 9
(i) Economic and monetary union (EMU) 9
(ii) Structural reforms 10 /g252
(2) D EVELOPMENTS IN TRADE 10
(i) Commercial services trade 10
II. TRADE POLICY REGIME :
FRAMEWORK AND OBJECTIVES12
(1) G ENERAL FRAMEWORK 12
(i) Institutional framework 12
(ii) Transparency and public consultations 13
(2) E NLARGEMENT 15 /g252 /g252
(3) C OMMON COMMERCIAL POLICY 17
(i) Instruments 17 /g252
(4) E XTERNAL TRADE RELATIONS 19
(i) WTO 19
(ii) Bilateral and regional trade
relations21 /g252/g252 /g252
III. TRADE POLICIES AND PRACTICES
BY MEASURE33
(1) M EASURES DIRECTLY AFFECTING
IMPORTS33
(i) Customs procedures 33 /g252/g252
(ii) Customs valuation 37 /g252
(iii) Rules of origin 37
(iv) Community tariff 39 /g252/g252 /g252 /g252 /g252
(v) Indirect taxes 43 /g252
(vi) Prohibitions, restrictions, surveillance,
and licensing requirements46 /g252/g252 /g252
(vii) Safeguard measures 55 /g252/g252
(viii) Product regulations and standards 59 /g252 /g252/g252/g252 /g252 /g252 /g252
(ix) Government procurement 130 /g252
(x) State-trading 136 /g252
(xi) Anti-dumping and countervailing
measures136 /g252 /g252/g252/g252
(2) M EASURES DIRECTLY AFFECTING
EXPORTS145
(i) Exports subsidies 145
(3) M EASURES DIRECTLY AFFECTING
PRODUCTION AND TRADE146
(i) Legal framework for business 146 /g252
(ii) Competition policy 147 /g252
(iii) Subsidies 149 /g252
(iv) Intellectual property rights protection 152 /g252/g252WT/TPR/M/102/Add.2
Page 6
Topic Page HK,
ChinaIndia Japan Korea Malaysia Mexico New
Zealand
IV. DEVELOPMENTS IN SELECTED
SECTORS166
(1) A GRICULTURE 166
(i) Main characteristics 166
(ii) Common Agricultural Policy (CAP) 167 /g252/g252/g252 /g252
(iii) CAP and Enlargement 177
(iv) Developments in selected subsectors 179 /g252
(2) F ISHERIES 194
(i) Common Fisheries Policy (CFP) 194 /g252
(3) F INANCIAL SERVICES 198
(i) Main characteristics 198 /g252
(ii) Policy developments 199 /g252/g252 /g252
(4) T ELECOMMUNICATIONS 204
(i) Policy developments 204 /g252/g252 /g252
(5) E-C OMMERCE 206
(i) Main characteristics 206
(ii) Policy developments 207 /g252
(6) O THER SERVICES SECTORS 213 /g252 /g252
Annex 226WT/TPR/M/102/Add.2
Page 7
CONTENT: NORWAY, SWITZERLAND, TAIW AN, THAILAND, UNITED STATES, URUGUAY
Topic Page Norway Switzerland Taiwan Thailand United
StatesUruguay
I. ECONOMIC ENVIRONMENT 9
(1) P OLICY DEVELOPMENTS 9
(i) Economic and monetary union
(EMU)9
(ii) Structural reforms 10
(2) D EVELOPMENTS IN TRADE 10
(i) Commercial services trade 10
II. TRADE POLICY REGIME :
FRAMEWORK AND
OBJECTIVES12
(1) G ENERAL FRAMEWORK 12
(i) Institutional framework 12 /g252
(ii) Transparency and public
consultations13 /g252/g252
(2) E NLARGEMENT 15 /g252 /g252
(3) C OMMON COMMERCIAL POLICY 17
(i) Instruments 17
(4) E XTERNAL TRADE RELATIONS 19
(i) WTO 19 /g252/g252 /g252
(ii) Bilateral and regional trade
relations21 /g252/g252 /g252
III. TRADE POLICIES AND
PRACTICES BY MEASURE33
(1) M EASURES DIRECTLY AFFECTING
IMPORTS33
(i) Customs procedures 33 /g252/g252 /g252
(ii) Customs valuation 37
(iii) Rules of origin 37 /g252
(iv) Community tariff 39 /g252/g252 /g252
(v) Indirect taxes 43 /g252/g252
(vi) Prohibitions, restrictions,
surveillance, and licensing
requirements46 /g252
(vii) Safeguard measures 55 /g252/g252
(viii) Product regulations and
standards59 /g252/g252 /g252 /g252
(ix) Government procurement 130
(x) State-trading 136
(xi) Anti-dumping and
countervailing measures136 /g252/g252
(2) M EASURES DIRECTLY AFFECTING
EXPORTS145
(i) Exports subsidies 145 /g252
(3) M EASURES DIRECTLY AFFECTING
PRODUCTION AND TRADE146
(i) Legal framework for business 146 /g252
(ii) Competition policy 147
(iii) Subsidies 149 /g252
(iv) Intellectual property rights
protection152 /g252/g252WT/TPR/M/102/Add.2
Page 8
IV. DEVELOPMENTS IN
SELECTED SECTORS166
(1) A GRICULTURE 166
(i) Main characteristics 166 /g252
(ii) Common Agricultural Policy
(CAP)167 /g252/g252 /g252
(iii) CAP and Enlargement 177 /g252
(iv) Developments in selected
subsectors179 /g252
(2) F ISHERIES 194
(i) Common Fisheries Policy
(CFP)194 /g252
(3) F INANCIAL SERVICES 198
(i) Main characteristics 198
(ii) Policy developments 199 /g252
(4) T ELECOMMUNICATIONS 204 /g252
(i) Policy developments 204 /g252
(5) E-C OMMERCE 206
(i) Main characteristics 206
(ii) Policy developments 207 /g252/g252
(6) O THER SERVICES SECTORS 213 /g252
Annex 226WT/TPR/M/102/Add.2
Page 9
ADVANCE WRITTEN QUESTIONS FROM WTO MEMBERS
AND REPLIES PROVIDED ON BEHALF OF THE EUROPEAN UNION
I. ECONOMIC ENVIRONMENT
(1) P OLICY DEVELOPMENTS
(i) Economic and monetary union (EMU)
Question from Malaysia:
The goal of monetary policy and fiscal restraint in the EU is price stability. However, this could bring
about risks of slower economic growth, continued high unemployment and lower trade growth. Given
the strengthening of the euro recently, does the EC envisage a more relaxed monetary policy and thus
higher growth in 2002?
A: The design of EMU combines a single monetary policy conducted by the European Central Bank
(ECB) with decentralized fiscal policies determined  at the national level. The Treaty assigns monetary
policy the primary goal of maintaining price stability. Decades of practical experience in Europe and
elsewhere and a large number of economic studies suggest that monetary policy will contribute most
to raising growth prospects over the longer term by maintaining price stability in a lasting way. There
are several ways in which price stability – in the sense of avoiding both prolonged inflation and
prolonged deflation – contributes to achieving high levels of economic activity and employment:
– price stability allows changes in relative prices to be more easily observed, since they are not
obscured by fluctuations in the overall price level. This contributes to a more efficient
allocation of resources.
– by reducing the "inflation risk-premium" associated with holding assets over the longer term,
monetary policy can improve the allocative efficiency of capital markets and raise theincentive to invest.
– the credible maintenance of price stability will make it less likely that individuals and firms
will divert resources from more productive uses in order to hedge against inflation.
– price stability reduces the real costs entailed when inflation exacerbates the distortionary
impact of tax and social security systems.
With monetary policy assigned the primary objective of price stability, there is a greater role for
national fiscal policies in adjusting to country-specific developments. The Stability and Growth Pactsets out the medium-term objective for Member States’ fiscal policies of having budgetary positions
that are "close to balance or in surplus". The aim is to allow for fiscal discipline, which will facilitate
the ECB’s task of maintaining price stability, whilst permitting Member States the necessary room for
manoeuvre to cope with normal cyclical fluctuat ions, respond to country-specific developments and
undertake needed structural reforms.Whilst the recent appreciation of the euro will contribute to the objective of maintaining price
stability, the issue of whether or not monetary policy should be changed is entirely one for the ECB.
The independence of the ECB is guaranteed by the Treaty.
As far as growth prospects for 2002 are concerned, a recovery is already underway. Growth in the
euro area and the European Union is expected to st rengthen in the second half of this year as past
interest rate reductions and the working of automatic fiscal stabilizers take effect against the
background of an improved international environment.WT/TPR/M/102/Add.2
Page 10
(ii) Structural reforms
(a) Internal market
Question from Chile:
En relación a los compromisos que se desprenden del Acuerdo OTC/OMC ¿Existe una revisión
periódica o planificada de los reglamentos técnicos desarrollados al interior de la CE de manera de
velar porque no se mantengan más allá de lo necesario ene le sentido del párrafo 3 del Articulo 2 del
OTC? Si no existe un plan preestablecido ¿es posible que los privados soliciten la revisión de dichos
documentos?
A: Yes, this is an ongoing and continuous pr ocess. The Communication from the Commission to the
Council of Laeken (5 December 2001) on "Simplifying and Improving the Regulatory Environment"
sets the objective of reducing the volume of existing EU legislation, if possible, by at least 25% by
January 2005. This goal is in line with the proposals of the White Paper on European Governance of25 July 2001 to "launch a high-profile programme to review and simplify Community legislation
adopted before 2000." It is also in line with the Communication from the Commission on the
Codification of the Acquis Communautaire of 1 November 2001, which indicates that the codification
of the entire acquis should be completed by the end of 2005.
Question from Mexico:
¿Puede la UE explicar cómo garantiza a sus socios comerciales el respeto de sus compromisos
multilaterales en materia de movimiento de personas, frente a medidas que en materia de
reforzamiento a la protección de fronteras exteriores esta ha adoptado?
A: We suggest that Mexico follows developments in the legislative process on the SIMAP web-site
(http://www.simap.eu.int), where developments will be posted from time to time.
(2) D EVELOPMENTS IN TRADE
(i) Commercial services trade
Question from Chile:
En la sección sobre Comercio de Servicios Comerciales se menciona que las estadísticas de
exportaciones de servicios alcanzaron 219 millones de euros durante el año 2000. Esta cifra no
considera los ingresos de los proveedores europeos de servicios comerciales establecidos en otros
países. La delegación de Chile quisiera conocer la cifra de estos ingresos generados mediante la
presencia comercial en el exterior.
Asimismo, sería útil conocer las cifras relativa s a la participación de empresas con mayoría de
capital extranjero operando actualmente en la UE. Esta medida ayudaría a determinar el grado de
apertura de la economía comunitaria en este se ctor y, por tanto, su atractivo comercial para
potenciales inversionistas extranjeros.
A: Please see table below:WT/TPR/M/102/Add.2
Page 11
EU: World* FDI stocks by sector
(Mio ecu/euro)
Inward (World* FDI in EU)
Total 1995 1996 1997 1998 1999 2000
Total (excluding reinvested earnings) 366.873 421.927 495.915 610.620 722.806 873.709
Agriculture and fishing 346 411 476 582 562 627
Mining and quarrying 32.639 35.029 29.800 22.627 21.290 15.251
Manufacturing 135.586 150.258 167.939 245.639 257.435 298.462
Electricity, gas and water 4.557 3.262 14.056 9.063 11.263 11.798
Construction 580 2.884 3.958 3.101 2.663 1.555
Trade and repairs 50.605 49.202 52.535 54.651 77.892 99.968
Hotels and restaurants 3.506 4.973 5.913 7.039 8.153 7.715
Transport, storage and communication 3.481 6.695 10.972 21.439 24.179 44.428
Financial intermediation 72.126 89.400 109.745 119.484 147.268 187.261
Real estate and business activities 64.028 70.754 89.271 107.262 131.468 144.491
Other services -1.288 9.016 8.590 11.634 12.744 15.663
Totals may not correspond to the sum of individual items due to "NOT ALLOCATED FDI".
Reinvested earnings are not included in sectoral data.
* World excluding intra-EU.
Source: EUROSTAT (CRONOS).
Outward (EU FDI in World*)
1995 1996 1997 1998 1999 2000
Total (excluding reinvested earnings) 471.912 543.174 666.588 825.249 1.186.989 1.513.972
Agriculture and fishing 965 878 932 1.371 881 1.092
Mining and quarrying 46.609 53.657 55.175 92.954 123.411 138.980
Manufacturing 208.719 238.768 275.809 340.678 401.209 474.099
Electricity, gas and water 5.662 6.524 10.864 15.800 48.412 82.353
Construction 3.909 6.837 7.465 7.727 8.790 9.862
Trade and repairs 35.472 34.458 43.013 48.940 64.093 58.741
Hotels and restaurants 4.734 2.905 6.227 7.191 8.205 11.675
Transport, storage and communication 3.474 9.367 19.602 35.854 146.995 180.292
Financial intermediation 95.687 96.785 133.779 167.540 199.669 290.512
Real estate and business activities 63.993 74.325 97.512 99.667 168.102 218.326
Other services 2.212 18.089 10.900 15.527 21.800 20.802
Totals may not correspond to the sum of individual items due to "NOT ALLOCATED FDI"
Reinvested earnings are not included in sectoral data.
* World excluding intra-EU.
Source: EUROSTAT (CRONOS) .WT/TPR/M/102/Add.2
Page 12
II. TRADE POLICY REGIME : FRAMEWORK AND OBJECTIVES
(1) G ENERAL FRAMEWORK
(i) Institutional framework
Question from Canada:
Paragraphs 4 and 5 indicate that the Commission has the exclusive right of initiative for proposed
Community Acts and that they are implemented at  Community level or at Member State level,
overseen by the Commission. Regardless of what ent ity is responsible for the actual implementation of
the measure, please share if the Commission is considering putting in place a transparencyframework for the Community Acts for which the Commission has the exclusive right of initiative.
Please indicate if the Commission intends to consult on these initiatives in a timely manner before the
initiative becomes final at the Commission level.
A: In the White Paper on European Governance, the Commission made a certain number of
commitments to the quality and transparency of improving the large number of consultations which it
already holds. In this regard, the Commission has published a list of bodies through which civil
society is being consulted and confirmed the protocols signed with the Economic and Social
Committee and the Committee of the Regions. Moreover, the Commission will shortly publish
guidelines on the collection and use of expert advice by the Commission with a view to ensuring thatsuch advice comply with the principles of responsibility, pluralism and integrity.
Alongside the Action Plan on better regulation, the Commission adopted, on June 5
th 2002, a
Communication proposing minimum st andards of consultation. This Communication is the subject of
a further public consultation and should be finally endorsed by the Commission by the end of 2002.
Reinforcing the consultation stage prior to legislative proposal will have no impact on thecommitments made with regard to the Economic and Social Committee and the Committee of the
Regions with a view to obtaining opinions, in appropriate cases, before exercising its right of
initiative; nor will it have an impact on the special role played by the social partners.
Question from the United States:
The Secretariat reports that progress has been made on transparency, by adopting policies that give
all persons, regardless of nationality, access to documents of EU institutions on a non-discriminatorybasis, and that the EU has made increasing use of public consultations. Please explain the legal
status of these reforms, and make assurances that there will be means of guaranteeing that such
non-discriminatory access to documents and use of public consultations will be maintained without
exceptions. Also, please describe other steps the EU will take to enhance the transparency of its
operations, such as prior public notification of upcoming actions and decisions by EU institutions andmeans of appeal to the general public.
A: In the White Paper on Governance, the Commission put forward the idea to prepare a set of
minimum standards on consultation in the form of a code of good conduct as well as the idea of more
extensive partnership arrangements.In 2002 the Commission approved a consultative document including proposals for such minimum
standards for consultation of interested parties (COM (2001)277 final) which will be finalised in 2002
in light of the comments received.WT/TPR/M/102/Add.2
Page 13
(ii) Transparency and public consultations
Questions from Canada:
Paragraph 8 of the government report states that a broad reflection on how to improve thefunctioning of the Union was launched thr ough the Commission’s White Paper on European
Governance in Summer 2001. It also indicates that this has placed stress on improving the regulatory
environment and on greater involvement of all st akeholders in the European policy-making process,
objectives the EU has also sought international ly. Please describe recent developments on the
involvement of third country stakeholders in this process.
A: The White Paper on European governance launched a broad public consultation to collect
contributions from Member States, Candidate and other third countries, and representatives of the
civil society, stakeholders, etc…
This consultation ended on 31 March 2002. The Commission has received a substantial response.Some 8% of the contributions came from third countries, including responses from non-EU countries
(international associations, United States of America, Russia, Canada, Norway, Switzerland,
Australia) and candidate countries (Romania, Poland, Hungary, Czech Republic).
Some non-EU contributors have argued that governance principles  applied by the Commission within
the EU, notably with regard to consultation and better regulation, should also be applicable towardsnon-EU governments and interested parties.  The Commission is currently examining the response
received in the above public consultation and will, before the end of the year, present a report.
Paragraph 9 mentions that publication of Community Acts is required in the Official Journal of the
European Communities (Article 254). Does the Commission intend to develop a comprehensive, on-line registry where all Community Acts will be easily obtainable, together with user-friendly cross-
references to Member State laws  and other forms of implementation?
A: Community legislation is available on Eurolex and Celex. Celex also includes links to
implementing legislation in MS. Those two database s are administered through the Publication Office
of the EC.
Paragraph 10 notes that the Commission’s White Paper on European Governance, issued in July
2001, calls for a renewal of the “Community Method” by involving more people and organizations in
shaping and delivering EU policy, and that since 2000, the Commission has applied a code of conduct
to consultations and intends to develop more extensive partnership arrangements. Please describe in
greater detail the approach taken in the development of the these partnerships arrangements.
A: The Commission is still giving consideration to the way in which this action point of the White
Paper on Governance should be implemented. More recent developments in the area of consultation
will be provided in the report for 2002.
As for the Code of Good Behaviour, the issue is not pertinent here.
Note 22 of paragraph 10 indicates that on 1 November 2000, a new Code of Good Behaviour for
relations between officials and the public came into force which, inter alia, provides for persons with
a direct interest in Commission proposals or decisions to be allowed to make their views directly
known to the Commission, and to be given the reasons on which the decisions are based and thearrangements for appeal (European Commission Press Release IP/00/999).
Please explain EU’s assessment of the usefulne ss of the new Code of Good Behaviour and indicate
areas that need improvements.
Please indicate if the Commission keeps a public record of the representations made to the
Commission by persons with a direct interest in the matter.WT/TPR/M/102/Add.2
Page 14
Please share the criteria to be a “person with a direct interest”.
Please indicate if natural or corporate persons from outside the EU qualify.Please explain the procedure used to make representations to the Commission.
Please indicate how and when persons with a direct  interest are informed of the existence of the
proposals.
A: See reply to previous question.Paragraph 11 mentions that the Commission has created the Consultation, the European Commission
and Civil Society (CONECCS) database, and that with respect to trade policy, the Commission
consults regularly with representatives of civil society, business, and trade unions through plenary
meetings, issue groups, and ad hoc meetings. Please indicate if the EU currently has any similarmechanism/registry for trading partners with specifi c interests to help them  systematically interact
with the Commission through plenary meetings, i ssue groups, and ad hoc meetings. If not, please
indicate if such a mechanism/registry is envisioned.
A: It should be noted that the CONECCS database  is a voluntary register. The Commission does not
automatically grant access to consultation to those organisations registered in the date base. It also
should be noted that only non-governmental actors are eligible for the database.
The Commission recently launched a programme of Sustainable Impact Assessments on trade policy.
These include assessments of negotiations with all major current trade negotiations (Chile and
Mercosur; WTO negotiations, forthcoming: ACP-EU, Gulf Cooperation Council negotiations). As
part of this process, the Commission calls for the widest possible consultations (including third
country representatives) via direct contacts with the consultants, via ad hoc public meetings convenedspecifically for this purpose and via discussion in the WTO Committee on Trade and Environment.
An agricultural SIA on the food crops sector was recently presented in this way. Public meetings are
announced on the DG Trade website. All studies are made available as they evolve (inception,
midterm and final reports) on contractors' websites for consultation and comment, whether to the
Commission or directly to the contractor.
Question from the United States:
The Treaty of Amsterdam is supposed to enhance the transparency of the EU’s work by making four
specific improvements. Could th e EU please elaborate on these im provements, providing details of
how these improvements have been manifested.
A: Scope extended to third-party documents
Under the previous system, applicants could only request access to documents drawn up by the
institution itself. Regulation 1049/2001 has abolished this authorship rule and applies to all documentsheld by an institution, including those received from third parties.
A refusal to grant access to a document received from a third party must be based upon the exceptions
to the right of access provided for in the Regulation. When it is not clear whether a document should
or should not be released, the institution will consult with the author. However, the author cannot veto
the disclosure of his document if the institution is convinced that it should be released.The authorship rule has been maintained only for two specific cases:
Member States may request an institution not to release a document originating from them without
their consent.
So-called sensitive documents, i.e. documents originating from institutions, Member States, third
countries or international Organisations, classified as confidential or higher for public interest reasons,
are not released without the author’s consent.
Overriding public interest in disclosureWT/TPR/M/102/Add.2
Page 15
The new Regulation has introduced a public interest test for most exceptions to the right of access.
This means that the institutions have to balance the harm that would be caused by releasing a
document against the public interest in disclosure of its content.
No public interest test is performed when access is denied on one of the following grounds:
Protection of the public interest: public security, defence and military matters, international relations,
financial, monetary or economic policy.
Protection of privacy and the integrity of the individual.Document register
The Regulation contains an obligation to establish a public register of documents that should beaccessible in electronic form. The Council operates such a register since January 1
st 1999. The
European Parliament and the Commission opened their registers on June 3rd 2002, as requested by the
Regulation (Art. 11).These registers are useful research tools. They can be accessed through the internet and contain
references of documents (number, title, date, author ), enabling citizens to identify relevant documents
and to make specific request for access. As far as possible, the full text of documents is made
available through these registers.
Deadline for reply
The deadline for reply has been reduced from one month to 15 working days. When dealing with
complicated requests, the institutions may extend the deadline with another 15 working days.
Question from Thailand:
According to the Report, the Commission’s White Paper on European Governance calls for a renewal
of the "Community Method" by involving more people and organizations in shaping and delivering
EU policy. We welcome the Commission’s move to promote greater transparency and more effective
consultation, which will be beneficial to developing a long-term policy perspective. We would be
interested to know whether the Commission may co ntemplate allowing non-EU representatives to take
part in consultation.
A: In 2002 the European Commission approved a consultative document containing proposals for
minimum standards for consultations of interest ed parties [COM(2001)277final]. This document,
which also mentions the role of non-EU interested parties in consultation processes, will be finalised
in 2002 in light of the comments received.
(2) E NLARGEMENT
 
Question from Switzerland
Les perspectives d'élargissement de l'UE à l'Est se  précisent. Dans quelle mesure celui-ci devrait
avoir une influence sur le niveau des prix d'intervention des principaux produits agricoles (céréales,
lait, viande), sur le système actuel des quotas laitiers, et sur les niveaux totaux de soutien de la boîte
"orange", de subvention aux exportations ainsi qu'en matière d'accès au marché (droits de douane)de l'UE élargie?
 A: Selon le scénario le plus vraisemblable, dix nouveaux Etats Membres devraient intégrer l'UE dès
2004. Le principe de base est la reprise de l'acquis communautaire en dépit de certains aménagements
toujours nécessaires. En conséquence de quoi, l'UE maintiendra son système des quotas laitiers mêmesi l'application individuelle peut poser certains problèmes pour les PECOs compte tenu des calculs
réalisés à l'époque. La CE n’envisage pas d'effet immédiat sur les prix d'intervention des produits
concernés par les organisations communes de marché. Pour ce qui concerne les autres points la CE ne
manquera pas de respecter tous ces engagements à l’OMC.
 WT/TPR/M/102/Add.2
Page 16
 Question from Korea:
The Korean Government believes that the enlargement of the EU currently under negotiation with 13Central and Eastern European countries will contribute to promoting economic prosperity and
political security in Europe. However, there is a concern that an increase in intra-regional trade with
the new members may reduce trade with non-member countries.
What is the view of the EU on this possible “trade diversion” effect?
A: Thirteen countries have expressed their interest to join the EU, twelve of which are currently
engaged in accession negotiations. Not only will enlargement of the EU secure peace and stability in
the region, it will also reap significant economic benefits for the new Member States, for the EU as a
whole, but also for third countries which will benefit from an enlarged Single Market, with a single
set of rules, standards and certification.In the run-up to accession, the Association Agreements which link candidate countries to the EU
provide for free trade in industrial products between the candidate countries and the EU. It is therefore
expected that enlargement will not lead to significant modifications of current trade patterns between
the EU and the candidate countries.
The same applies to S. Korea, which mostly trades industrial products with the EU. Moreover, S.Korean businesses will be able to draw increased opportunities from the alignment of new Member
States to the EU's external tariff as of their day of accession to the EU, which will lead to an overall
reduction in tariffs on industrial products in the region."
 
 Question from the United States:
We understand the EU is encouraging advance adoption of EU animal and food safety standards by
those countries negotiating accession to the EU. In what specific areas is the EU seeking suchadvance adoption, and which candidate countries are affected?
A: Candidate Countries must comply  with the EU acquis at the latest at the day of accession. In order
for this to work in practice we encourage the Cand idate Countries to gradually bring their legislation
and administration in compliance with the acquis in advance of accession. This is the case in theveterinary field as in most other parts of the acquis.
 
Question from India:
Has the EU made any study or assessment of the likely effect on its trading partners and especiallythe developing countries of its enlargement plans?
A: Enlargement will bring overall benefits also for third countries. From an economic point of view,
enlargement will increase the size of the single market, where third countries will be faced with a
single tariff and a single set of trade rules and administrative procedures. From a political point of
view, enlargement will increase political stability  throughout Europe, and enable the EU to tackle
more effectively problems such as
 international organised crime.
Question from China:
China is taking note of the on-going enlargement process of EU. We hope that an expanded EUshould facilitate free trade and avoid adverse effects on its trade relations with any other WTO
members. We would like to ask EU to explain its plan on how to offset the negative effects to its
trading partners as a result of the enlargement.
Recalling the previous enlargement of EU, some compensatory issues remain unsettled between
certain WTO members and the EU because their market access to EU was seriously damaged as a
result of EU’s last enlargement. We hope these i ssues can be addressed without any further delay on
the side of EU.WT/TPR/M/102/Add.2
Page 17
A: Thirteen countries have expressed their interest to join the EU, twelve of which are currently
engaged in accession negotiations. Not only will Enlargement of the EU secure peace and stability inthe region, it will also reap significant economic benefits for the new Member States, for the EU as a
whole, but also for third countries.
In the run-up to accession, the Association Agreements, which link candidate countries to the EU,
already provide for free trade in industrial products and a significant liberalisation of trade in
agricultural products between the candidate countries and the EU. It is therefore expected thatenlargement will not lead to significant modifications of current trade patterns between the EU and
the candidate countries. Consequently, the trade-diverting effect is not expected to be significant, and
existing trade patterns with third countries will therefore also not be altered significantly.
Businesses around the world will be able to benefit from increased opportunities, notably through the
alignment of new Member States to the EU's external tariff as of their day of accession to the EU,which will lead to an overall reduction in tariffs in the region for both industrial and agricultural
products. An enlarged single market, with a single set of rules, standards and certification, will
simplify trade relations.
Within the WTO/DDA, the EU is co mmitted to increase market access including in all areas. The
candidate countries will also be bound by these commitments.Upon EU enlargement, there will be an examination in the WTO under GATT Article XXIV in order
to verify whether trade has become more restrictive for other WTO members. In line with GATT
rules, China may submit a request for compensation if it considers that enlargement has led to
breaches of GATT bindings for products of interest. The EU will discharge its obligations.
 
(3) C OMMON COMMERCIAL POLICY
(i) Instruments
Question from Canada:
Paragraph 26 mentions that the EU is also committed to carrying out Sustainability ImpactAssessments (SIAs) of both its multilateral and bilateral trade negotiations. A general SIA of the EU’s
negotiating mandate was carried out before the launch of the new round, with further sectoral
assessments now being carried out. Please provide information on the methodology behind the
Sustainability Impact Assessments (SIAs). Also, pl ease explain how these SIAs relate to the EU’s
approach to "sustainability" and various EU Corporate Social Responsibility (CSR) initiatives.
A: SIA: complete Information on SIA me thodology is available on the website at
http://europa.eu.int/comm/trade/ and at the address of our consultant :
- SIA of WTO negotiations : http://idpm.man.ac.uk/sia-trade/- SIA of MERCOSUR/Chile negotiations : www.planistat.com/sia
Sustainability Impact Assessment developed by DG Trade aims at improving the quality and
coherence of trade policy  by identifying sustainability trade off.
SIA should help integrating sustainability into trade policy :
• by analysing the issues of a trade negotiations with respect to sustainable development
• by informing negotiators of the possible social, environmental and economic consequences of
a trade agreement
• by providing guidelines for the design of possible flanking measures, the sphere of activity of
which can exceed the commercial field (internal policy, capacity building, internationalregulation), and which will make it possible to maximise the positive impact and to reduce the
negative impact of the trade negotiations in question.
Thus, the objective of an SIA is not to assess the desirability of further liberalisation overall but
rather:WT/TPR/M/102/Add.2
Page 18
• To provide elements of information on the possible range of impacts, thus making it possible
to ensure the final decisions are the optimal ones
• to accompany and optimise their implementation, which is often essential for the
sustainability of agreements
Process and content of SIA:
SIA is not only an assessment study but also a process
External and internal processes are very important for the quality and relevance  of an SIA and for its
integration  in the negotiations
Because of the complexity of the issues at stake, SIAs have to take place in the frame of a relevant
process which ensure proper consultation and transparency :
• consultation is necessary to contribute to identification of main sustainability issues and to
gather the broadest expertise possible
credibility in the SIA has to be based on an immediate and complete transparency
Whereas SIA are a analytical tool for policy maker dedicated to improve coherence and quality of
trade policy, CSR is an action tool, among others, through which policy objectives can be
implemented. SIA is aimed at helping policy makers, while CSR is targered mainly to business, but
both seek to achieve the same objective, which is sustainable development (SD).
Linkages between CSR and SIA are possible: flanking measures set out by an SIA can helpcompanies, with the support of public authorities, to better identify and endorse good practices in the
field of SD."
Question from Australia:
We note that the EU imports from only nine non- EU WTO Members are subject to exclusively MFN
treatment in all sectors (Secretariat report, page17, paragraph 19). How does the EU balance its
commitment to the WTO trading system and the D oha Round negotiations with its extensive network
of preferential and regional trade arrangements?
A: The central plank of the EU’s trade policy is its support for the open, rules-based multilateral
trading system, which is based on WTO. The EU’s strong commitment to a multilateral approach to
trade liberalisation and rule-making has been very evident during the period under review, as the EUhas been in the forefront of efforts to launch a new Round of multilateral trade negotiations, the
comprehensive agenda for which offers benefits to all WTO Members.
WTO rules recognise that regional trade agreements (RTAs) can make a positive contribution to the
development of trade. RTAs can also provide the basis for much more far-reaching trade
liberalisation, regulatory initiatives and elimination of non-tariff barriers to trade than have yet been
possible within the WTO, where decisions are taken by consensus within the membership (144
Members and steadily rising). At the same time, the relevant WTO rules establish a multilateral
discipline on RTAs and the EU always negotiates its regional agreements to be compatible with those
rules. The EU also recognises that differences of view among WTO Members exist as to how the
relevant WTO rules and procedures should be interpreted and applied and accordingly welcomes theinclusion of this wider issue within the negotiating agenda of the DDA.
In relation to the statement in the Secretariat report that imports into the EU from nine WTO Members
are subject to exclusively MFN treatment in all sectors, it should be noted - as indeed has been
pointed out by the EU in previous TPRM exercises - that many of the countries benefiting from
preferential access to the Community market do so on a non-reciprocal basis, for example under theGSP. EU exporters to these countries are subj ect to MFN market access conditions, which are
generally only liable to be improved as a result of multilateral negotiation.WT/TPR/M/102/Add.2
Page 19
How does the EU undertake sustainability impact assessments on trade liberalisation? Are these
internal processes or contracted out? If the latte r is the case, how does the EU undertake consultation
and liaison with other WTO members, particularly those members who are assessed, on methodology
and findings before the results are made public? Australia would also be grateful if the EU would
provide a response on the same questions if the assessments are undertaken internally (i.e. by the
EU)?
A: The EU undertakes sustainability impact assessments (SIAs) on trade liberalisation in an open and
transparent manner: the methodology and the results of studies are all publicly available in their
entirety. The studies themselves are conducted externally by contractors selected on the basis of
public call for tender. It is a condition of the consultants’ contracts that they consult widely and that
they are open to input from all interested parties via e-mail/their website. The EU’s SIAs examine the
effects of trade liberalisation both on the EU and on other WTO members. With the experience of
recent pilot study (sectoral SIA study for instance ), the EC considers that involvement of third
countries ( and in particular of countries where case studies are carried out) is highly desirable in the
SIA analysis. Where current studies will examine the effects on particular WTO members, as is the
case for example with the sectoral studies, these countries will be involved in the study.
Question from Malaysia:
Para 19 of the Secretariat’s Summary Observati ons noted that nine WTO members are subject to
exclusively MFN treatment in all product categories. What does this mean and how does it differ from
other preferential trade agreements?
A: This statement by the WTO Secretariat is founded on the observation that imports from nine WTO
Members (Australia, Canada, Chinese Taipei, Hong Kong China, Japan, Korea, New Zealand,
Singapore and the United States) are subject to exclusively MFN treatment on import into the EU,
while imports from all other WTO Members benefit from preferential access to the EU market,
whether under regional trade agreements or under the specific preferential trade regimes that are
detailed in the body of the Secretariat report. In relation to this statement, it should also be noted - asindeed has been pointed out by the EU in previous TPRM exercises - that many of the countries
benefiting from preferential access to the Community market do so on a non-reciprocal basis, for
example under the GSP. Accordingly, EU exporters  to these countries are subject to MFN market
access conditions.
(4) E XTERNAL TRADE RELATIONS
(i) WTO
(a) Overview
Questions from Australia:
Australia would appreciate a clear indication of whether the EU views the WTO rules framework as
mutually supportive with multilateral environment agreements (MEAs); and if not, why?
A: In accordance with the EC submission to the WTO on DDA paragraph 31 (i), the EC considers that
WTO rules and MEAs have to be mutually supportive if sustainable development is the goal we all
want to reach. The EC objective is fully in line with what is stated in the preamble the MinisterialDeclaration paragraph 6, namely ensuring that the aims of upholding and safeguarding an open and
non-discriminatory multilateral trading system and acting for the protection of the environment and
the promotion of sustainable development is mutually supportive. To date, no panel has been invoked
in relation with a dispute arising from a MEA. However, we cannot rely on the fact that no panel untilWT/TPR/M/102/Add.2
Page 20
now means no panel ever. The extent to which existing WTO rules accommodate trade measures
taken for environmental purposes is still, despite recent clarifications by panels and the AppelateBody, in a situation of legal uncertainty. The WTO jurisprudence has evolved favourably as regards
the application of Article XX. Legally, panels are not bound by previous panel decisions, and opposite
conclusions have been, and may be reached, as panels and even Appellate Body findings onlyconstitute ad-hoc solutions to specific cases without jurisprudential effect. A formal clarification of
the relationship between existing WTO rules and specific trade obligations set out in MEAs would bebeneficial to both WTO and MEAs negotiators who would have a much clearer guidance on what
they can do in their respective remits.
(b) WTO market-access commitments
Questions from Taiwan:
Given that the EU has bound and reduced the Aggregate Measurement of Support (AMS), as well as
the value and volume of subsidized exports, could the EU explain its use of AMS and blue subsidy
measures, more specifically for agricultural products in terms of their compliance with WTO
regulations? And how the EU justifies on the use of those subsidy measures?
A: The EC refers Taiwan to its notifications and related clarifications to the WTO CoA on domestic
support (G/AG/N/EEC/38 27/06/02).
The commitments in Services and List of Article II (MFN) exemptions of EU do not include Sweden,
Finland and Austria. Please advise if there are any special consideration. Are there any possibility to
consolidate those three member states’ specific commitments in services into the EU service
schedule? In addition, does the EU have any plan to liberalize the audio-visual service?
A: The fact that Austria, Sweden and Finland have separate schedules and MFN lists is due to the fact
that during the Uruguay Round they were not yet Member States of the EC and therefore negotiated at
the time separately. However, from the 1st January 1995 Austria, Finland and Sweden acceded to the
EC and, as for other EC Member States, the negotiations are now carried out by the EuropeanCommission on behalf of the Communities and its Member States. With regard to the consolidation of
the schedules into a single EC-15 schedule, we are giving consideration to the best way to undertake
this.
Questions from the United States:
What is the current status of the consolidated EU-15 schedule of commitments? Are there new
reasons for delay in its submission? In any case, when will it be made available to members?
A: The consolidated EU-15 schedule of commitments will be submitted to the WTO in the near
future.
Please explain how the EU is addressing the ques tion of MFN exemptions for countries that are
poised to join the EU.
A: The EU will address this issue at the moment when these countries will become Members of the
EU.
Question from Norway:
In the Commission’s report, paragraph 57, institu tional improvements to  the WTO system are
mentioned. Transparency and effectiveness of the or ganization are indicated as topics but we would
appreciate further information on thoughts of the ro le of the secretariat in regard to parliaments andWT/TPR/M/102/Add.2
Page 21
civil society. In addition, what thoughts does th e Commission have regarding efficiency of decision-
making?
A: The Commission supports the efforts made by the WTO Secretariat to have a regular dialogue with
the civil society and it considers that such a dialogue should not only be continued but also become a
structured feature of the Secretariat outreach activities. At the same time the Commission, as noted on
its submission of October 2000, believes that the WTO as a whole would clearly benefit from thecreation of a Parliamentary Assembly of consultative nature. Until the time such an Assembly is
created, the WTO Secretariat should continue and even increase its contacts with the national
Parliaments. Finally, as far as the efficiency of the decision-making is concerned, the Commission
notes that the WTO has been able to reach by consensus some very important decisions in the recent
past. The ever-growing membership of the organisation, however, calls all interested parties toseriously explore ways of facilitating the formation of the consensus, including the possibility of
reverting to the other forms of decision-making foreseen in Article IX WTO.
(ii) Bilateral and regional trade relations
(a) General
Questions from Canada:
According to paragraph 45 of the Government report,  from the EU point of view, it has continued to
be equally important to seek improvements to existing rules in such areas such as trade defence or
technical barriers to trade, and regional trade agreements, in order again to improve transparency
and predictability for traders, investors, consumers, and governments. Please explain what type ofconditions the EU proposes in regard to improvem ents to rules on regional trade agreements.
A: The EU welcomes the inclusion within the DDA of negotiations to clarify and improve the
disciplines and procedures applying to regional trade agreements under existing WTO provisions,
while taking into account their developmental aspects. The EU has made a submission
1 to the
Negotiating Group on Rules outlining its initial position in relation to this aspect of the work of the
Negotiating Group and identifying a number of issues that merit discussion and analysis during thecourse of the negotiations. The EU can be expected to come forward with further proposals and ideas
as the negotiations progress.
Paragraph 51 of the government report states that in regional trade agreements, the EU’s objective to
start negotiations for clear and quite strict rules defining the conditions to be met for FTAs andregional agreements to be WTO-compatible, was al so satisfactorily agreed in the Doha mandate.
Please explain what type of conditions the EU proposes in regard to improvements to rules on
regional trade agreements.
A: See answer to question above.Question from New Zealand:
We are pleased to note that the EC recognises th e importance of the multilateral trading system and
the need for any preferential arrangements that mi ght be agreed to contribute to and strengthen the
multilateral system (Secretariat report, para 16; EC report, paras 27, 60 and 97). What steps is theEC taking to ensure that its regional and bilateral trading agreements meet the GATT Article XXIV
requirement to cover "substantially all trade" and do not therefore detract from its and other
                                                     
1 Submission on Regional Trade Agreements by the European Communities and their Member States, 5
July 2002 (circulated in TN/RL/W/14 of 9 July)WT/TPR/M/102/Add.2
Page 22
members’ efforts towards multilateral trade liberalisation? Can the EC provide an outline of how
liberalisation of trade in the agriculture sector is provided for in its recently concluded agreementwith Chile?
A: In its negotiations for regional agreements, the EU always aims to ensure that WTO requirements
are satisfied, including as regards the coverage of "substantially all the trade ". In this regard, the EC
applies an internal benchmark as a reference point for the minimum trade coverage that should beachieved in any RTA entered into by the EU. This benchmark is that any agreement should provide
for complete liberalisation of at least 90% of trade by volume, at the latest by the end of any
transitional period necessary to provide for implementation. Furthermore, as indicated by WTO rules,
no major sector should be excluded from the scope of an RTA.
Negotiations for an Association Agreement with Chile, which incorporates an FTA foreseeing a veryhigh degree of liberalisation, were only concluded recently and the final text of the agreement,
including its annexes, are now being prepared for signature. The parties will notify the FTA to the
WTO under the relevant provisions of GATT Article XXIV and GATS Article V in due course.
Question from Taiwan:
We are concerned over the trade diversion effects of regional trade agreements, particularly in view
of the enlargement of the EU. We acknowledge the right of Members to enter into bilateral or
regional preferential trading arrangements consistent with relevant WTO provisions. We request that
the EU ensure such arrangements are trade-creating and not trade-distorting to the third parties.
A: The likely overall economic impact and advantages/disadvantages of an agreement are among the
factors that the EU will consider when assessing proposals for any new RTAs. Empirical evidencetends to support the conclusion that the trade creation effects of RTAs outweigh any trade diversion
where - as in the EU - external MFN tariff protection is relatively low and bilateral trade relationships
are already well developed.
As regards Enlargement, the EU recognises the potential significance of the accession of possibly as
many as 13 new Member States in the coming years. The net effects of Enlargement should bepositive for third countries, reflecting the stimulus to trade and investment that expansion of the single
European market will bring. The EU has consistently pursued both regional and global openness in
trade, notably through EU leadership in GATT /WTO. Enlargement will extend to the candidate
countries this open attitude towards reductions in trade barriers on a multilateral basis. In any event,
the EU will respect all relevant WTO obligations.
Question from India:
Both the Government and the Secretariat Reports take note of various initiatives by the EU in
entering into a plethora of preferential trade arrangements with some of its selective trading partners.
To name a few, EU has been linked to all the ten Central and Eastern European Countries by Europe
Agreements. EU has concluded bilateral association agreements with 8 Mediterranean countries. The
Free Trade Agreement with Mexico has already been in force since 1July, 2000.EU has already
established a Customs Union with Turkey. The negotiations for establishing regional trade
association with Mercosur are on. Besides, negotiations for accession of more European countries
into EU are also progressing. Although the Government Report asserts that ‘in right circumstances’these regional initiatives strengthen the multilateral system. India is, however, convinced that these
arrangements lead to a significant trade diversi on away from the countries not party to such
agreements.
We are encouraged to note from the Government report (Para 51) that one of EU’s negotiating
objectives for the Doha Work programme is to ensure ‘quiet strict’ rules defining the entering into of
RTAs and also their WTO compatibility. We would like to know from EU what measures they areWT/TPR/M/102/Add.2
Page 23
contemplating to ensure that the trade of non-party countries and especially the developing countries
among them does not suffer due to the pr eferential trade arrangements of EU?
A: The EU welcomes the inclusion within the DDA of negotiations to clarify and improve the
disciplines and procedures applying to regional trade agreements under existing WTO provisions,
while taking into account their developmental aspects. The EU has made a submission2 to the
Negotiating Group on Rules outlining its initial position in relation to this aspect of the work of theNegotiating Group and identifying a number of issues that merit discussion and analysis during the
course of the negotiations. This list of issues includes the question of closer alignment of the
disciplines imposed on parties to FTAs with those imposed on parties to Customs Unions, particularly
in respect of the obligations of GATT Article XXIV:5 concerning the implications of individual
RTAs for non-parties. Any clarification of WTO rules in this area should indeed reflect the principlethat closer regional integration take place without raising barriers to the trade of other parties.
Article XXIV of GATT 1994 although permits derogation of MFN principle also requires the
countries party to a preferential trade arrange ment to ensure that the trade of non-party
member countries is not adversely affected on account of such an arrangement. Is there any
system in place in EU to objectively assess this aspect?
A: Article XXIV of the GATT 1994 indeed se ts out the conditions which any regional
agreement (FTA or Customs Union) must satisfy. In its negotiations for regional agreements,the EU always aims to ensure that WTO requirements are satisfied, including those relatingto GATT Article XXIV:5. The issue of the co mpatibility of any proposed new initiative with
the relevant WTO disciplines is therefore typically a question which will be addressed duringthe course of negotiation and at the conclusion of any new regional agreement. Of course, the
compatibility of any regional trade agreement, including those concluded by the EU, with therelevant WTO provisions can only be definitively confirmed when the agreement has beennotified and examined under th e relevant WTO provisions.
(b) Preferential trade regimes
Questions from Canada:
Paragraph 45 states, "The new regime incorporates  the "Everything-But-Arms (EBA)" initiative for
LDCs, which took effect on 5 March 2001 and grants duty-free treatment for all products (except for
arms), with certain exceptions (rice, bananas, sugar), for which transitional arrangements apply."
The EBA was implemented more than a year ago. One of the issues relates to the rules of origin and
cumulation provisions applied to least developed countries. In this respect, the EU had made a
commitment to reviewing and simplifying its rules of origin. Since the implementation of the EBA, has
the EU noted any increases in imports from LDCs? Has the EU reviewed its rules of origin to
facilitate access to its market for products originating from LDCs?
A: The EU has not taken a formal commitment to review rules of origin for LDCs. The Commission,
however, indicated that the application of rules of origin for LDCs would be strengthened in order to
avoid discrepancies vis-à-vis other preferential regimes such as the one for OTCs. As indicated in the
question, the EBA initiative was implemented only one year ago. The rules of origin and cumulation
were based on previous regimes, which implies a benefit for least developing countries since they
already knew the system. Furthermore, the EC has offered assistance in terms of training in origin
                                                     
2 Submission on Regional Trade Agreements by the European Communities and their Member States, 5
July 2002 (circulated in TN/RL/W/14 of 9 July)WT/TPR/M/102/Add.2
Page 24
rules through in-country seminars and other ad hoc actions. Finally we would like to racall that
beneficiaries can obtain derogations for rules of origin on the basis of justified cases.
Another factor which could limit the benefits of the EBA is the ability of LDCs to satisfy international
or European standards, in terms of sanitary, phyt osanitary regulations, or the environment. Please
elaborate on any plans of action destined to help LDCs increase their capability to meet EU
standards.
A: It is quite obvious that when EU sanitary and phyto-sanitary standards come into force or become
more binding, some producers in third countries, especially the most disadvantaged ones, are facing
difficulties to comply, and to comply on time, w ith these obligations. They may even lose their
competitiveness or be excluded from remunerative  European markets, thus going against efforts to
combat poverty  which is  the overarching objective of the EU Development policy.
Within the framework of coherence of Community policies, several mechanisms have been put in
place while conceiving and implementing standards. They aim at helping first poor small-scale
farmers in developing countries to cope with new situations. They can cons ist of political dialogue,
information, deadlines in standards enforcement, etc .
Direct support is also be provided in the "Doha spirit" through various financial instruments of
development aid and/or of those managed by Dir ectorate-General for Research. There are three main
directions we are pursuing:
- To strengthen the National Competent Authorities to allow them to play fully their role,
- to support private sector efforts to fulfil EU  import standards, for example through Chambers
of Commerce, and
- to facilitate participation of developing countries in international debates where international
standards are negotiated.
EC support to developing countries in this regards is very much capacity building oriented, mainly in
the sense of human resources strengthening. This support can be organised at the national level, but in
some cases it may be more efficiently set up at the regional level. Obviously investment can also be
considered when indispensable.
Question from Japan:
Japan seeks clarification on the legal status of the various agreements mentioned in Chapter IV(1)(i),
Preferential Trade Regimes, with regard to the WTO agreements.
A: (a) Trade preferences for the ACP countries under the Cotonou Agreement are covered by a waiver
granted on 14 November 2001 (WT/MIN(01)/15);
(b) The EU GSP scheme operates under the umbrella of the relevant provisions of the GATT
Enabling Clause (the Decision on differential and more favourable Treatment, Reciprocity and fuller
Participation of Developing Countries of 28 November 1979, L/4903);(c) Autonomous Trade Measures in favour of countries of the Western Balkans are covered by a
waiver granted on 8 December 2000 (WT/L/380 and Corr 1)
(d) the trade regime for products of the Overseas Countries and Territories (OCTs) was notified under
GATT Article XXIV in 1970. The most recent bienni al report on the operation of the regime was
circulated on 13 May 2002 in do cument WT/REG106/R/B/2, G/L/548.
Questions from Australia:
Has the EU carried out any studies comparing the relative benefits for developing countries of
specific trade preferences and across the board opening of developed country markets in sectors of
interest to developing countries? If it has, could it provide us with the results?WT/TPR/M/102/Add.2
Page 25
A: In 1999, in the course of their negotiations on the Cotonou Agreement, the ACP States and the
Commission conducted an Analysis of trandes in the Lome IV Trade regime and the consequences ofretaining it. This analysed the impact the trade preferences granted under the Lome IV Convention. It
is available upon request.
In the past, have such preferential arrangements resulted in a substantial expansion of exports by the
EU’s developing country partners?
A: With regard to preferences for ACP produc ts under the Lome Conventions, the Commission and
the ACP States have analysed the effects of the generous preferences provided on ACP exports. While
the Lome preferences have resulted in a substantial expansion of ACP exports to the EU for some
products and for some countries, they have not been  sufficient to maintain the ACP share of the EU
market overall. Of course, it cannot be known wh at would have happened to the ACP market share in
the absence of preferences.In general it has been concluded that trade preferences are not an automatic
engine for trade growth but rather offer opportunitie s. The extent to which such opportunities can be
seized depends on a variety of factors related among other things to the production, supply and trading
capacity of the beneficiary countries, their trade and investment policies, their capacity to handleissues related to trade etc. This is why the ACP-EU Partnership Agreement signed in Cotonou
provides for Economic Partnership Agreements to address these issues in a comprehensive way.
Are preferences an important factor in over all exports from least developed countries?
A: Yes they are. Almost 100% of all LDCs expor t to the EC are carried out under GSP preferences.
As these countries have very poor export diversification, the GSP preferences are the only systemwhich allows their exports to survive in a very competitive environment.
A recent UNCTAD quantitative assessment of the im pact of the EU’s "Everything but Arms" initiative
found that most of the benefits to least develope d countries would arise from greater preferential
access for sugar and rice. How does the EU explain its decision to postpone full implementation oftariff cuts for these products under the agreement until September 2009 ?
A: It should be recalled that the EC was the first to introduce such a scheme and only one other WTO
Member (New-Zealand) has so far followed our example. Regarding sugar and rice the EC is already
a major importer from developing countries including the LDCs. The phasing-in of the benefits forsugar and rice were necessary in order to allow for the necessary adaptations of the EC domestic
provisions. Unfortunately, it is too soon to evaluate benefits of such an initiative.
To what extent have least developed countries fully used the preferences on offer under the
"Everything but Arms" initiative?
A: Either the beneficiary countries have "fully" used the preferences or "to a certain extend". On the
other hand, as there are no quotas, beneficiariy countries are entitled to make use of the preferences
without any limits. Total imports from LDCs in 2001 were 13,4 billion Euro, eligibles for preferences
(other than MFN 0 % and without sugar, rice, ba nanas and arms) were 6,4 billion Euro, preferential
were 2 billion Euro. The utilization rate thus was 32,2%.
The EU has indicated an intention to ensure that its preferential access arrangements for developing
countries, such as generalised systems of preference s, will be strengthened to ensure environmental
protection in exporting countries. Please explain how  the EU will ensure that these changes are WTO
consistent?WT/TPR/M/102/Add.2
Page 26
A: Since the 1970s, WTO members have agreed under an ‘enabling clause’ that members can grant
voluntary preferential tariffs to developing countries. The EU’s GSP comes under this category. TheGSP provides additional preferential treatment fo r environmental protection. The special incentive
arrangements for the protection of the environm ent are available for countries complying with
international standards concerning sustainable forest management, in particular the standards of the
International Tropical Timber Convention. They are available upon request.
The arrangements offer additional tariff preferences for imports of products of the tropical forest,which are included in the general arrangements. The additional preferences amount, as a rule, to a
reduction of ad valorem duties by 5 percentage points, or otherwise to a reduction of at least the same
extent as the one available under the general arrangements.
Question from the United States:
What percentage of EU goods and services trade, on a value basis, is now conducted on a preferential
basis? Please show the value of EU imports and exports for each preferential trading partner.
A: There have been a number of attempts to measure the actual extent of preferential trade at world
level and for the EC. These are not always totally reliable, due to data insufficiencies, but they do tendto suggest that the share of preferential trade in  total EC trade is in fact less than the number of
preferential agreements to which the EC is a party would seem to suggest.
Sapir (1998) estimates that in 1996 roughly one thir d of EC trade in goods took place at MFN rates,
one third at preferential rates (including GSP) and one third at zero MFN duty (where tariff
preferences did not matter). In other words around 70% of imports entered the EU market on an MFN
basis.
It is important to underline that these estimates are an upper bound since they are obtained on thebasis of the assumption that all dutiable imports from trading partners covered by a RTA with the EU
enjoy preferential treatment in the EU, while an unknown proportion of dutiable imports from EU
RTAs partners is actually subject to MFN duties.
Question from Brazil:
With relation to the GSP (document WT/TPR/G/102, page 17, paragraph 62), if a good is produced in
a customs-free area in a given country from materials not originating in that country, and if this is
consistent with the rule of established origin, could this product benefit from the preferencial
treatment granted by the GSP when it is exported to the EU?
A: As a matter of principle, products obtained in a free zone will acquire originating status only if
they comply with the rules of origin, including pr ocedural and control requirements (especially the
ability for the authorities to verify on a documentary basis and on the spot the conditions are met, at
the time of issuing proofs or on request).
What is the composition of the Communitarian Customs Territory? What are the ultramarine
territories and countries for which the GSP is applied?
A: Customs territory of the Community: Article 3 of CCC
OCTs: Annex II of the EC Treaty and Annexes IA & IB of Council Decision 2001/822/EC of 27
November 2001.
All OCT are at the same time GSP countries: Annex I of Council Regulation (EC) n° 2501/2001 of 10
December 2001
Questions from India:
The Enabling Clause which constitutes the legal basis for the GSP schemes envisages that such
preferences have to granted in a ‘generalized, non-reciprocal and non-discriminatory ‘ way. LinkingWT/TPR/M/102/Add.2
Page 27
the benefits to non-trade issues such as environmental and labour standards as well IPR rights and
the fight against the drug curtail the benefit under the scheme and introduce elements ofdiscrimination and reciprocity into the GSP scheme. Specifically linking the GSP scheme to core
labour standards is very much against the spirit of the Singapore Declaration and also the Doha
Declaration on the issue Would EU clarify why they have linked their GSP scheme to non-trade
issues?
EU may also inform whether all developing countries are eligible for the benefits under the
Special Arrangements to combat drug productio n and trafficking under the EU-GSP scheme? What
are the criteria adopted for inclusion of countries under this arrangement?
Does EU perceive drug trafficking regime as being generalised and non discriminatory? Is
there any provision under the scheme to ensure that all similarly placed countries are included under
this regime? Is this scheme open to all countries to seek inclusion in accordance with transparentcriteria?
We would like to know whether this special arrangement/reward for countries for combating
drug production and trafficking leads to trade dive rsion and discrimination against other developing
countries?
Can EU clarify whether there is any provision under the GSP scheme for countries adversely
affected through trade diversion by the GSP scheme to seek compensation?
Has any assessment been made with regard to  the impact of the special arrangements under
the drug trafficking clause in the GSP Scheme on countries, which are not covered under this special
window?
Are the special arrangements under the drug trafficking regime consistent with the WTO ? If
not, does EU intend to obtain waiver from WTO for introduction of the special arrangements for
certain countries under the GSP Scheme?
A: The above questions raised by India have already been discussed in bilateral consultations between
India and the EC under Article XXIII of the GATT in the context of the DSU. Discussions are still
ongoing. The questions have all been answered. Therefore, we believe that repeating the exercise here
serves no purpose. Furthermore, if we were to give detailed replies in the context of the TPRM, theconfidential character of these consultations would be seriously undermined. It should also be recalled
that according to the texts, the Trade Policy Review  Mechanism is not intended to serve as a basis for
the enforcement of specific obligations under the agreements or for dispute settlement procedures.
Having said that, the EC wishes to stress that it is convinced of the full consistency of its entire GSP
scheme with the WTO provisions.
Question from Thailand:
The EU’s revised GSP scheme has caused great concern among some Members as to its diversionfrom the goal authorized under the Enabling Clause. To be consistent with the Clause, GSP benefitsmust be granted on a generalized, non-reciprocal  and non-discriminatory basis. However, the EU
provides special incentives to countries demonstrating adherence to certain internationally
recognized core labour standards or to certain environmental standards, both of which are non-trade
related issues. Furthermore, special trade preferences are provided for certain products originating
in ACP countries and countries that combat drug production and trafficking, while other developingcountry Members are excluded from these preferential treatments.
In light of the above, we would like to hear the EU’s  view on this issue, especially with regard to the
generalized and non-discriminatory basis of the Enabling Clause.
A: The EC wishes to indicate that the GSP is an autonomous regime granted on a non-reciprocal and
non-discriminatory basis in full conformity with our WTO obligations.WT/TPR/M/102/Add.2
Page 28
Under the EU’s Generalized System of Preference s scheme, the criteria used in the graduation
mechanisms to identify the ‘graduation’ for each sector are based primarily on the computed values
for the Development Index (DI) and Specialization Index (SI). However, we cannot develop a clear
conception of how such criteria are based on a logically validated basis as they lack clear reasoning
in the assignment of the range of numerical values of DI as follows:
Development Index (DI) Threshold for the SI
= or > -1.0 100%
< -1.0 and = or > -1.23 150%
< -1.23 and = or > -1.70 500%
< -1.70 and = or > -2.00 500%
Can the European Union please explain in a logistically meaningful and clear context how the range
of values of the Developmental Index is established?
A: Some GSP beneficiary countries have reached, in certain sectors, a level of competitiveness which
enables them to face international competition with out the benefit of preferential treatment. Such
sectors qualify for graduation if they meet certain criteria.
Graduation does not apply to LDC’s nor to countries which account for less than 2 % of imports ofthe products of the sector concerned from all beneficiary countries. Graduation does not apply to
countries whose development index is lower than –2.
The development index refers to the level of a beneficiary country’s industrial development and its
participation in international trade. It is measur ed by a formula based on the ratio between the per
capita income and the value of manufactured exports, which compares that country’s data to those of
the EU. The formula used for calculating a country ’s development index is explained in Annex II of
the Regulation (CE) no 2501 of 10 December 2001.Sectors may qualify for graduation under two differ ent provisions: the so-called lion’s share clause
and the specialization index. The lion’s share clause compares the imports from a beneficiary country
in a given sector to those from other beneficiary countries. Where imports from one country account
for more than 25 % of EU imports from all beneficiary countries in the same sector, that country
qualifies for graduation in that sector.The specialization index compares the imports from a beneficiary country in a given sector to those
from the same country in all other sectors. Where a given sector’s share exceeds certain thresholds,
the country qualifies for graduation in that sector. Thresholds vary according to a country’s
development index. They are specified in Annex II of the Regulation.
As less developed countries tend to be specialised in a smaller number of sectors, they would qualifyfor graduation more easily. This, however, would be  incompatible for their needs. Thresholds are
therefore higher for countries with a lower development index (and vice versa). They were established
taking into account the typical situation of countries having reached different levels of development.
(c) Free Trade Agreements (FTAs)
Question from Canada:
Paragraph 99 of the government report states th at increasingly, the EU’s approach to FTAs will
extend beyond goods and services liberalization to more comprehensive rule-making engagements.
Please indicate what is meant by "mor e comprehensive rule-making engagements".
A: The EU has concluded regional agreements with a wide range of partners, for example recently
with South Africa, Mexico and Chile. The EU is itself also the product of an ambitious process of
deep and wide-ranging regional integration. Experien ce of these initiatives tends to show that the
positive impact of regional integration is particularly strong in cases where regional agreements
provide for "deep integration" in the sense of initiatives going beyond elimination of import andWT/TPR/M/102/Add.2
Page 29
export tariffs and measures having equivalent effect so as to provide for elimination of non-tariff
barriers to trade and for regulatory harmonisation a nd convergence, even to the extent, in some cases,
of establishing common regulatory frameworks between RTA partners. Even in cases where full
regulatory harmonisation and convergence may not themselves be immediately feasible, measures to
promote the equivalence or complementarity of regulatory approaches between RTA partners are
likely to support the positive trade and investment effects of liberalisation within a regional
framework.
Questions from Japan:
Japan would like to know why the European Economic Area (EEA) agreement has not been notified
to WTO under the GATT Article XXIV, in spite of the fact that this agreement has already been
notified under the GATS Article V.
A: Information on the Agreement on the European Economic Area was circulated to GATT
Contracting Parties on 17 July 1992 in Document L/7048, in the form of a joint communication by the
EC and the EFTA states. As the FTAs between the EC and each of the other EFTA states parties to
the EEA (Iceland, Liechtenstein and Norway) were already notified to the GATT in the early 1970s,no notification was made under GATT Article XXIV.
Japan seeks clarification on the legal status of the new agreements with Switzerland on the movement
of natural persons, and air and road transport, from the viewpoint of the conformity with the GATS.
A: These agreements reflect a process of progressive trade liberalisation between the EC and one of
its regional trading partners.The bilateral agreement on air transport with Switzerland concerns traffic rights, which are excluded
by the Annex on Air Transport Services. Other elements, such as provisions for groundhandling
services may be subject to GA TS disciplines.
As for the bilateral agreements on land transport and free movement of persons these in part deal with
services covered by GATS. However, their provisions are covered by the relevant Article IIexemptions (MFN exemptions) listed by the EC. In the case of rail transport the agreement also has
provisions on transit and access to networks.
Japan would like to know why the transitional period of liberalization of South Africa's imports from
the EU under the TDCA exceeds 10 years.
A: Under the EU’s Trade, Development and Co-operation Agreement with South Africa liberalisation
of access to the South African market for products of EU origin takes place on a longer timetable than
is applied for trade in the opposite direction. The EU considers that this asymmetric approach to
transition and the maximum 12-year duration of the transitional period for imports into South Africais justified on the basis of the significant difference between the levels of development of the two
parties.
Questions from Argentina:
En el Informe del Gobierno – WT/TPR/G/102, párrafo 70 se informa sobre el Acuerdo de asociación
concluido con la República de Chile.
Se apreciará conocer:
si el Acuerdo entrará en vigor en su integridad en un solo momento o se prevé la entrada en vigor por
capítulos. En esta última hipótesis, podría explicar las previsiones en materia adoptada para el
capítulo comercial.WT/TPR/M/102/Add.2
Page 30
A: The negotiations on an EU-Chile Associati on Agreement were concluded in April 2002. The full
agreement will enter into force in its entirety after completion of the internal adoption procedures ofboth Parties. In addition, in the trade area, the provisions concerning trade in goods, government
procurement and competition will provisionally enter into force at an earlier stage. This is foreseen for
early 2003.
Si existen previsiones para los productos de la pesca y, en su caso:
- disposiciones adoptadas en materia de origen
- cuotas acordadas
- tratamiento tarifario intra y extra-cuota
- disposiciones adoptadas en materia de acceso al recurso por parte de empresas de origen
comunitario
- 
A: Fish and fisheries products are included in the Agreement and therefore subject to a liberalisation
programme and to preferential rules of origin. Full tariff elimination is foreseen for the vast majority
of fisheries products. For some specific products, such  as tuna loins, tariff preferences apply within a
tariff quota. As for origin rules, fish and fishery products are subject to a "wholly obtained" criteria,however bilateral cumulation is of application.
The agreement does not foresee in the direct access to Chilean fisheries resources. However,
Community enterprises will be granted, on the basis of reciprocity conditions, increased investment
opportunities in the fisheries sector through participation in Chilean enterprises.
Si se han incorporado disposiciones de liberalización en materia de frutas y hortalizas. En tal caso
interesa conocer:- si se han asignado cuotas o se acordó una reducción tarifaria o se adoptaron medidas que
combinan ambos elementos (cuotas y tarifas) . Por favor indicar plazos de desgravación.
- 
A: Fruits and Vegetables are included in the schedule of dismantling.The path of dismantling is
depending of the level of the ad valorem duties.For some particular cases, like tables grapes, a tariffquota has been agreed for some particular periods of the year, for the rest of the year the general
dismantling schedule will be applied.
En materia de vinos y propriedad intelectual:
- si el acuerdo contiene disposiciones relativas a Indicaciones Geográficas
- si la protección acordada es mayor a la que brinda el ADPIC. Por favor explicar en qué
consiste
- si se abordaron los problemas derivados de la superposiciones que resultarían de protección
de indicaciones geográficas de una parte que están protegidas bajo derecho de marca en el
territorio de la otra parte. En su caso, soluciones encontradas en el Acuerdo.
- 
A: The agreement contains measures for mutual protection of Geographical Indications .
A reciprocal positive list of protected geographical indications (including appellations of origin) in
sense of WTO trade Related Intellectual Property Righ ts Agreement, a phasing out of existing names
considered as generic or semi-generic and the dates of the phasing out.The Agreement provides measures for Ex-officio enforcement and rules of invalidation of the use of
trademarks and other names which contain or consist of a geographically protected name.
Questions from the United States:
Please provide details on products either excluded from, or not yet incorporated in, recent EU FTAs.
When and how is agriculture expected to be incorporated in the Euro-Mediterranean agreements?WT/TPR/M/102/Add.2
Page 31
A: Information on FTAs concluded by the EU, including as regards their product coverage, is
submitted to the relevant WTO Committee, the Committee on Regional Trade Agreements, so as toenable the Committee to conduct examinations of RT As in the light of relevant WTO obligations and
in accordance with its mandate. The EU has submitted full information on its own FTAs in this
context, including as regards product coverage.
The Euro-Mediterranean agreements cover all sectors including agriculture and it is not correct to
imply that agriculture is not already incorporated  in the Euro-Mediterranean agreements. The extent
of liberalisation of trade in agricultural products between the EU and individual Euro-Mediterranean
partners under these Agreements reflects the results of individual negotiations. Typically, the
agreements also establish an on-going process for the negotiation of progressive liberalisation of trade
in agricultural and fishery products.
What is the status of the EU’s negotiations on FTAs with Chile and Mercosur? How will the eventual
agreements cover substantially all agriculture and services trade? Will there be transition periods for
liberalization? If so, for how long will transition periods last?
A: Negotiations for an Association Agreement with Chile, which incorporates an FTA foreseeing a
very high degree of liberalisation, were only concluded recently and the final text of the agreement,
including its annexes, are now being prepared for signature. The parties will notify the FTA to the
WTO under the relevant provisions of GATT Article XXIV and GATS Article V in due course.
Question from Brazil:
Why have the EU and Mexico, in the Free Trade Agreement they have signed, established rules of
origin that are to be applied only temporarily (document WT/TPR/G/102, page 17, paragraph 69)?
A: The set of preferential rules of origin agreed between the Community and Mexico is based on
established rules that the Community has been applying in the context of other preferential Free Trade
Agreements.
However, in a limited number of specific cases the origin rule as proposed by the Community hasbeen kept in Appendix II of Annex III, but an alternative temporary rule has been included in
Appendix II(a). This approach was followed with the purpose to take into account either the
manufacturing processes carried out in Mexico and/or the resourcing of the necessary non-originating
materials. Some of these temporary origin rules are subject to a revision procedure.
How does the EU interpret the phrase "rules used in normal commercial operations", since article IV
of the WTO Agreement on Government Procurement establishes that rules of origin are subject to the
results of the harmonization programme of the aforementioned rules (yet to be finished) as well as to
negotiations on trade in services?
A: Rules of origin under the FTA between Mexico and the EU are interpreted by a Special Committee
on Customs Co-operation set up by the Joint Council.
How is the ban on technology licensing dealt with in the "offsets" in cases of government procurement
in which a public entity contracts the development of a technology or in which the contract signedestablishes that a technology shall be developed in the execution of that contract?
A: According to the EU - Mexico FTA, procuring entities cannot impose or seek offsets. Any
condition imposed by procuring entities on local content, licensing of technology counter-trade or
similar is banned.WT/TPR/M/102/Add.2
Page 32
Article III (8) of GATT 1994 does not consider the application of laws, regulations and requirements
on government procurement to be discriminatory, as long as products are not purchased with a viewto commercial resale or with a view to the production of goods for commercial sale. On the other
hand, the WTO Agreement on Subsidies establishes in its article 1 (a) iii that purchase of goods by
governments is a subsidy, but in its article 8 considers subsidies for industrial technology, regional
development and the adaptation of existing facilities  to new environmental requirements as non-
actionable subsidies. How are those provisions compatible with the prohibition, in the Free TradeAgreement with Mexico, of "offsets" related to ince ntives to local development or to the improvement
of the situation of the balance of payment by means of local content requisites, the granting of
licenses for the use of technology, investment and compensated trade?
A: Purchase of goods by governments may be fall under the definition of a Subsidy when a benefit is
thereby conferred (Art. 1 (b). Nothing in the FTA between the EU and Mexico prevents governments
to provide goods or services (previously purchased through appropriate procurement process) as a
non-actionable subsidy for the purposes contemplated in Article 8 of the Agreement on Subsidies and
Countervailing Measures. What the prohibition of offsets in the FTA intends is to avoid procuringentities imposing additional requirements to its principal purchasing needs.
In the agreement signed with Mexico, the EU makes an exception to enterprises that participate in
"competitive markets". How can such enterprises be defined?
A: The EC considers that state ownership over a company is not the relevant criteria for applying or
not procurement rules, but the existence of effective competition in a given sector. As criteria tomeasure competition in each sector are diverse, there is not an overall definition. The EC reports
regularly of the degree of liberalisation in key sectors such as energy, telecom, transport and others.
With regard specifically to telecommunications, the EC legislation on public procurement foresees the
exclusion of this sector from the application of the public procurement rules, thus reflecting the
existence of a "competitive market", when following criteria are fulfilled:- other entities are free to offer the same service,
- in the same geographical area,
- and under substantially the same conditions.
(article 8 of Directive 93/38/EEC)
The European Court of Justice has dealt with those criteria in the Case C - 392/93 - 26.03.1996 BritishTelecom I, in which is stated that "the criterion laid down by Article 8(1) of the directive, namely that
"other entities are free to offer the same services in the same geographical area and under substantially
the same conditions", is to be verified as a matter of law and of fact, having regard in particular to all
the characteristics of the services concerned, the existence of alternative services, price factors, the
dominance or otherwise of the contracting entity' s position on the market and any legal constraints."
(d) Other bilateral relations
Questions from Japan:
The Report states that in addition to its support for the multilateral trading system the EU is engaged
in developing trade relations with other trade partners in the world through a number of preferentialtrade regimes, free-trade areas and regional initiatives, and other bilateral relations. In this regard,
Japan wishes to have a detailed explanation on th e "Agreement on maritime transport between the
European Community and its Member States, on the one hand, and the People's Republic of China on
the other hand", which is due to be agreed by the end of 2002.
Concerning the above mentioned agreement, plea se provide detailed information on whether it
includes more discriminative provisions against possible third parties, compared to the existing
agreements between individual Member States and China.WT/TPR/M/102/Add.2
Page 33
A: The mentioned maritime agreement it expected to be signed in December 2002. The agreement is
the first maritime agreement to be concluded at EC level - and builds on the existing bilateralagreements between China and Member States of the EC. The agreement does not - as it could be
understood from the questions - include provisions that discriminate against third parties. Instead, the
agreement liberalises international maritime transport services, in particular in the following areas:
• It allows and specifies how operators of either party are granted the right to establish entities to
engage in the usual business within this area,
• It sets out the principles of free access to cargo and non-discrimination, and
• It prescribes how further co-operation on maritime issues will take place.
Referring to paragraph 75 of the Government Report, Japan requests that more detailed information
be provided on the ongoing negotiations with the United States concerning mutual recognition in the
area of services sectors (architects, engineers, insurance), especially its current status, its future
perspective and specific contents.
A: In the framework of the Transatlantic Economic Partnership (TEP), the EC and the USA agreed at
the end of 1999 to explore the possibilities of concluding sectoral mutual recognition in the areas of
professional services (architects and engineers) and insurance. On the substance, initial discussions
have focused on work plans for each sector that would include the details of the issues to be
negotiated and the clear objectives to be met. Formal negotiations have however not started yet and itis not clear when they will.
Question from Brazil:
In paragraph 75 of WT/TPR/G/102, it is stated that  "negotiations [regarding the EU-US Partnership]
are ongoing in mutual recognition agreements in the area of services (architects, engineers,insurance)". Could the EU provide more informat ion on the scope and details of the agreements?
A: In the framework of the Transatlantic Economic Partnership (TEP), the EC and the USA agreed at
the end of 1999 to explore the possibilities of concluding sectoral mutual recognition in the areas of
professional services (architects and engineers) and insurance. On the substance, initial discussions
have focused on work plans for each sector that would include the details of the issues to be
negotiated and the clear objectives to be met. Formal negotiations have however not started yet and itis not clear when they will.
III. TRADE POLICIES AND PRACTICES BY MEASURE
(1) M EASURES DIRECTLY AFFECTING IMPORTS
(i) Customs procedures
Questions from Switzerland
To paragraph 2: The report indicates that the seizures of counterfeit and pirated goods increased of
one third from 1999 to 2000 and again of 27% in 2001. Does the EU note the same trend for 2002?
Are the same product categories affected?
A: It is too early to draw any final conclusions at the moment, but similar trends seem to be followed.
To related table III.I: In several EU Members the seizures of counterfeit and pirated goods have
decreased or increased significantly. To which factors can such changes be attributed ?WT/TPR/M/102/Add.2
Page 34
A: It has been found that where counterfeit was detected in one location, traffic rapidly moved to
another location in the Community which can explain such significant changes.
To paragraph 4: The report mentions that there ar e 31 free zones, established by the Member States
in enclosed areas located in maritime ports, airports or islands. Are changes foreseen in the future,
namely because of the EU enlargement, in the number of free zones?
A: EU enlargement will indeed alter the number of free zones in the Community, but the exact
number cannot be known until the EU takes a formal decision as to which countries will join when,
and the countries concerned notify the Commission of the free zones in operation on the date of
accession.
The candidate countries will not implement the Co mmunity's customs legislation fully until the time
of accession. This means that a number of so-called "free zones" those  countries may have now is not
necessarily the number that will be free zones in the enlarged Community.
Questions from Canada:
Paragraph 1 states that on 16 February 2001, the Commission announced a new strategy for the
Customs Union, building on the "Customs 2002" programme, to be renewed in "Customs 2007".
Please indicate if the Customs 2007 programme wi ll include provisions on the advance information
for targeting and pre-release purposes, and provisions that integrate elements of the WCO Revised
Kyoto Convention.
A: Advance information from a variety of sources is used by Member States in their own systems for
risk management, targeting and pre-release purposes. The Customs 2007 programme supports theseefforts and provides the means for identifying a nd sharing best practices and to work towards
equivalent results. The proposal can be viewed at
http://europa.eu.int/comm/taxation_customs/proposals/customs/customs_prop.htm#2002.
Paragraph 2 states that with respect to counterfeit and pirated goods, the customs administrationsrecorded an increase of one third in seizures from 1999 to 2000, under legislation implementing the
TRIPS Agreement at the border. Please indicate if  the EU legislation implemented after the TRIPS
Agreement meets minimal standards set, or if it goes beyond as requested by the private sector.
A: The EU legislation implemented after the TRIPS Agreement also covers other intellectual property
rights such patentsand design rights. In addition, this legislation allows the protection of IPR's in
situations other than simple importation, with the result that goods entered for other customs regimes
(e.g., transit, temporary import, export and re-export) are also covered.
Paragraph 5 refers to the good faith provision for importers, which allows for non-recovery of duties
in cases where the amount of duty legally owed was no t entered in the accounts as a result of an error
on the part of the customs authorities, which could not reasonably have been detected by an importer
acting in good faith and in compliance with all of the provisions of the legislation. The provision also
indicates how an importer can meet the standard of good faith, which does not include situations
where the exporter has given incorrect information to the authorities of the exporting country. Pleaseindicate how good faith is objectively and systematically determined.
A: In the context of the legal change in question, which is focussed on imports involving preferential
treatment, there can be no subsequent entry in the accounts of a customs debt if the amount legally
owed was not originally entered in the accounts due to an error on the part of the customs authorities
which could not have been detected by the person liable, provided he has acted in good faith and
complied with all the provisions laid down by the law in force as regards the customs declaration. TheWT/TPR/M/102/Add.2
Page 35
person liable can plead good faith inter alia when he can demonstrate that, during the period of the
trading operations concerned, he has taken due care to ensure that all of the conditions for preferentialtreatment have been fulfilled.
Questions from Taiwan:
We are impressed by the outstanding enforcement statistics that seizures of counterfeited goods by the
EU customs administrations reported a 33% and a 27% increase in 2000 and 2001 respectively.
Could the EU inform us what border measures have been taken against counterfeit and pirated goods
by the EU customs administra tions during the last two years.
A: Increased accent has been laid on the monotoring of internationl trading routes which is playing an
essential role in protecting the EU market. Moreover, cooperation with the industry covered byintellectual property has been further strenghtened, which can also be considered as a most effective
weapon.
As a result of technological advances, new products and inventions are entering the global market at
an accelerating pace. To deal with this, it is necessary to increase information transparency andreduce discrepancies among individual customs territorie s. We therefore suggest that the EU publish
its binding advance tariff classification rulings on its website.
A: Binding Tariff Information (BTI) may be based on confidential data, whose disclosure would be in
breach of trade confidentiality on which traders depend to offer accurate and adequate details of the
products under scrutiny. The EC is currently studying the best profile for a public database containing
the non-confidential part of the tariff rulings. The database shall be open to the public as soon as somemajor legal and technical issues are solved.
Question from Costa Rica:
De acuerdo al párrafo 1, "el 16 de febrero de 2001, la Comisión anunció una nueva estrategia para
la Unión Aduanera, sirviéndose del programa "Aduana 2002", que se renovará en el programa"Aduana 2007"...
Sobre el particular, nos gustaría solicitar a las autoridades europeas más detalles acerca del
programa "Aduana 2002", específicamente, sería interesante conocer cómo este programa
beneficiará a los importadores y exportadores en la UE. ¿En qué se diferencia del programa Aduana
2000 ?Además de lo anterior, Costa Rica está interesado en conocer si el programa antes mencionado
introduce nuevos elementos en materia de facilitación del comercio y en materia de control aduanero.
¿Se tiene previsto endurecer los controles aduaneros a la entrada de las mercancías o más bien se
prevé su flexibilización ? (párrafo 1)
A: The Customs 2000 became the Customs 2002 programme on 1 January 2000 but this in turn is
expected to be replaced by the Customs 2007 programme from 1 January 2003. The central objective
of Customs 2007 is to ensure that Community law is applied by customs in such a way as to maintain
the proper functioning of the single market in an  enlarged Community. The main objectives of the
programme are to ensure that the customs administrations of the Member States:(a) carry out co-ordinated action to ensure that customs activity matches the needs of the
Community's internal market;
(b) interact and perform their duties as efficiently as though they were one administration and achieve
equivalent results at every point of the Community customs territory;
(c) meet the demands placed on them by globalisation and increasing volumes of trade and contribute
towards strengthening the competitive environment of the European Union;WT/TPR/M/102/Add.2
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(d) provide the necessary protection of the financial interests of the European Union and provide a
secure and safe environment for its citizens;(e) take the necessary steps to prepare for enlargement and to support the integration of new Member
States.
Customs 2007 is a development and extension of the Customs 2002 programme, full details of which
are available at the following web site:
http://europa.eu.int/comm/taxation_customs/customs/information_notes/c2002/c2002.htm
It is also expected that the initiatives and actions developed under Customs 2007 programme will
contribute further to trade facilitation objectives.
Question from Mexico:
En el recuadro III.1 del Informe de la Secretaría (IS), se menciona la documentación que es
necesaria para el procedimiento de despacho en aduana, indicando que en el caso de algunas
bebidas alcohólicas en ocasiones se requiere la presentación de un certificado de autenticidad.
¿Puede la UE indicar qué bebidas alcohólicas están sujetas a esa regulación y qué se requiere para
que una bebida alcohólica esté sujeta a ese tipo de requisitos?
A: Dans l'Union Européeenne, un traitement tarifair e favorable peut être octroyé à certains vins de
Tokay classés sous la position 2204 du SH sous réserve de la présentation d'un certificat
d'authenticité. Il n'existe pas d'autres cas pour les boissons alcooliques.
Questions from the United States:
Within its description of "customs clearance procedures," the EU notes that it requires certificates of
origin for certain goods. The requirement of the submission of a physical certificate of origincontinues to impede imports into the EU, and it is less than trade facilitative. Will the EU encourage
member states to also accept certification of origin in the form of the producer’ s written certification
that the good qualifies as an originating good? If so, when?
A: As mentioned in the report, all goods brought into the customs territory of the Community are
subject to customs supervision and must be presented to customs with a written declaration, consisting
of the Single Administrative Document (SAD), accompanied by relevant documentation. As for the
latter, under the normal customs clearance procedur e, the documents required include the invoice or
other documents for customs valuation purposes. Only in very specific cases, may other documents be
required and basically to make the consignment eligible for the application of a preferential tariffarrangement. For origin purposes, imports are distinguished into preferential and non-preferential, and
certificates of origin are the exception rather than th e rule for non-preferential trade (the only instance
when they are required is in the case of some textiles products). In fact, traders need only declare the
origin of the goods by stating it in the customs declaration without any other additional document in
non-preferential trade transactions. With regard to preferential imports, it should be noted that theCommunity legislation already provides for the possibility of using invoice declarations (established
by so-called approved exporters) instead of origin cer tificates. Needless to say that this document too
is not required when goods are imported without any request for preferential treatment.
When will the EU, as an effort to advance trade facilitation, harmonize customs procedures among its
Member States?
A: The customs legislation of the EC already lays down common and uniform customs procedures,
governing major areas such as entry into the custom s territory, release for free circulation, transit,
warehousing, temporary admission, inward processi ng and exportation. The EC Customs Code also
provides a standard basis for the granting and implementation of simplified procedures involving
customs operations.WT/TPR/M/102/Add.2
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The EC is aware of the importance of consistent and uniform application of customs legislation in the
context of the customs union. In the customs field, a major programme is in place (currently theCustoms 2002 Programme, with a proposed Customs 2007 Programme in the pipeline) whose
objectives include the provision of support mechanisms to ensure equivalent results by Member
States' customs authorities at every point of the EC territory. The activities of the programme are
aimed at the 15 customs services working together as though they were one administration, improving
trade facilitation and reducing the costs of compliance with customs legislation.The New Computerised Transit System is an example of how a Community-wide system can
contribute significantly to trade facilitation, while at the same time improving customs controls and
providing greater financial security.
Further efforts will be made to ensure inter-operability (e.g., creation of common interfaces, common
data requirements) with regard to other customs procedures affecting more than one Member State.
Question from India:
In Chapter III, Para 2, the Secretariat Report notes that in 1999, fraud amounted to Euro 377 million
(2.7% of total import duty revenue collected). What percentage of these frauds was detected byapplication of risk assessment methods and what percent on the basis of hard intelligence? EU is
requested to give more detail of the nature of frauds committed and the basic tools employed to detect
such frauds.
A: In their report of an audit carried out in 1998 /99 concerning the valuation of imported goods for
customs purposes, the European Court of Auditors inter alia lays emphasis on the need to ensure, in
the context of the customs union, that Member States' customs authorities act uniformly in theirtreatment of imported goods. Particular reference is made to issues such as: (i) the importance of
having a level playing field in the application of the rules on customs valuation within the EC, (ii)
ensuring uniformity of application in order to safeguard the financial interests of the EC, (iii) the
common treatment of traders with operations in several Member States. In addition, a number of
operational and technical issues (e.g., valuation decisions, common control standards and workingmethods, increased co-operation between EC customs authorities) were considered.
(ii) Customs valuation
Question from India:
In Chapter III, Para 6, the Secretariat Report (WT/TPR/S/102) has indi cated that the Court of
Auditors published a special report in 2001 on customs valuation in relation to the objective of
accuracy and consistency across the customs administrations of the Member States. EU is requested
to indicate the major findings of this special repor t. Can EU also provide a copy of the special report
No. 23/2000 and Commission’s replies (OJC 84/1 of 14.3.2001)?
A: The position of the EC Commission was published in the same Report.
The report in question (N° 23/2000) was published in Official Journal C N° 84 of 14.3.2001 and is
accessible via the following web site: http://europa.eu.int/eur-lex/en.
(iii) Rules of origin
Questions from Brazil:
What differences are there between, and what is the scope of application of, the followingmechanisms: “Bilateral Cumulation”, “Dia gonal Cumulation”, “PanEuropean System of
Cumulation” and “Full Cumulation” (document WT/TPR/S/102, page 29, paragraph 8)?WT/TPR/M/102/Add.2
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A: Brazil may first of all have a look into the background paper WT/REG/W/45 of 5 April 2002,
prepared by WTO/CRTA on rules of origin in RTAs, which gives explanation on most of the
following points raised.
Cumulation of origin = with a view to determinin g the originating status of a product obtained from
working or processing of materials, cumulation allows a country to consider materials originating in
another (partner) country and incorporated in the product, as being originating in the country
concerned; these materials are therefore not taken into account as non originating for thedetermination of the originating status of the product.
Bilateral cumulation = cumulation applied between two countries, materials originating in one being
considered as originating in the other, where th e product incorporating these materials is obtained
(example: FTA between EC and Mexico)
Diagonal cumulation = cumulation applied between mo re than two countries, materials originating in
any of the countries party to this cumulation being considered as originating in the country where the
product incoprorating these materials is obtained (example: PanEuropean Cumulation)
PanEuropean Cumulation = Diagonal cumulation applied between the EC, EFTA countries, CEECs
and Turkey
Full cumulation = cumulation between more than two countries, belonging to a single zone where allworking or processing performed on all non originating materials incorporated are taken globally into
account in order to determine the origin (example: EC-Maghreb, EEA).
The concept of “diagonal cumulation” is applied when at least three countries take part in
simultaneous regional agreements that have identical rules of origin. In that case, could any form of
circumvention of trade take place through the countr y whose products are subject to lower tariffs by
the EU?
A: Whether such risks of circumvention may result from important differences in preferential
treatement given by the EC to different countries of the cumulation zone, either the concerned
products may be excluded from the cumulation or preferential tariff quotas may be established with
the most favoured country.
The EC Rule number 1602, of July 24th 2000, establishes, on its article 69, that “[…] if a product
which has acquired originating status by fulfilling the conditions set out in the list is used in the
manufacture of another product, the conditions applicable to the product in which it is incorporated
shall not apply to it, and no account shall be taken of the non-originating materials which may havebeen used in its manufacture”. Is it then correct to consider those non-originating materials as
originated in the EU?
A: That reflects the so-called 'absorption principle' which is widely used for origin purposes: it means
that insofar as a product meets the conditions to be considered as originating in a country, its non
originating part is no longer taken into considerat ion within the framework of a subsequent processing
(for instance within a cumulation system) where it will be treated as a 100% originating material. The
non originating materials do not become, strictly speaking, originating but are 'absorbed' in the
originating status of the product obtained.
Question from Thailand:
The Community applies two different sets of rules of origin: non-preferential and preferential. Under
the preferential rules of origin, the scope for cumulation is one of three types: bilateral, diagonal and
full. Can the European Union please explain the basis for these three types of cumulations?
A: Please see answer given to Brazil on rules of origin.WT/TPR/M/102/Add.2
Page 39
Question from Guatemala:
Párrafo 23: “El principio general del régimen de impor tación de la UE es la “liberalización de las
importaciones, es decir, la inexistencia de cualquier tipo de restricción cuantitativa”, aunque la CE
conserva el derecho a aplicar medias de vigilancia o salvaguardia (sección vii), así como medias de
defensa comercial (sección xi)”.
¿ Qué acciones positivas está realizando la Unión Europea para flexibilizar las normas de origen y
barreras no arancelarias con el objetivo de mejorar el acceso especialmente para aquellos Países enDesarrollo competitivos en el sector textil?
A: In the framework of the GSP, the Community is in principle in favour of allowing inter-regional
cumulation of origin between the countries of the Central American Common Market and those of the
Andean Community, as requested by these countries. This would allow Guatemala (a member of theCentral American Common Market) to benefit from cumulation of origin with more countries than is
at present the case. The Community is waiting for the organisations and countries concerned to fulfill
certain pre-conditions before making the necessary amendments to its legislation.
(iv) Community tariff
Question from Canada:
Paragraph 11 states, “The structure of tariffs in terms of stage of processing continues to show
evidence of tariff escalation, notably for food, beverage and tobacco products, as well as textile
products.”
The Uruguay Round Agreement on Agriculture made a si gnificant contribution to improving the terms
and conditions for agricultural market access; howev er, it also resulted in a continuation of major
disparities in the terms of access between Members and across products. Paragraph 13 of the Doha
Declaration calls for “substantial improvements” in agricultural market access. How is the EU
planning to provide real improvements in market  access, while proposing an approach to tariffs
similar to the one agreed upon during the Uruguay Round and while unwilling to discuss tariff quota
expansion?
A: The EC average MFN level of tariff for processed food is not higher than in other developed
countries. Moreover, a large majority of DCs does not even pay the MFN concerning processed food
on the EC market, as it is already very open to them (GSP, EBA initiative for LDCs, ACP, MED).
Other developed countries and the wealthiest developing countries should follow the lead of theEuropean Union in this field. At the MFN level, th e EC supports the same linear approach as in the
Uruguay Round in order to reduce tariffs.
Question from Taiwan:
The tariffs of some of the EU’s products, such as trucks, television sets and video and audio
equipment, are higher than those in other developed countries. In addition, the EU continues to apply
tariff escalation to processed food and textile products. Could the EU provide some clarification as to
the possiblity of reducing such tariffs?
A: As regards the tariffs referred to by the question, we would like to correct the statement since for
one of the products (trucks) the tariffs that can be found in other developed countries are certainly
higher. Furthermore it would be useful to point out that the rates quoted are the highest tariffs non-
agricultural products coming into the EU have to face, and that they are by far lower than the highest
tariffs ("peaks") rates found in other developed countries on other non-agricultural products. The EU
will not lower tariffs unilaterally. It therefore welcomes the comprehensive mandate for the current
round of multilateral negotiations, which will prevent any member from sheltering specific sectors. As
indicated in its submission to the Market Access Negotiating Group (TN/MA/W/1) the EU is readyWT/TPR/M/102/Add.2
Page 40
for an ambitious comprehensive approach to the negotiations provided it is matched by equally
ambitious commitments by other members. Finally, as regards other related products, it should not beforgotten that the EU has offered duty-free access under the terms and for the products covered by the
ITA.
Questions from Hong Kong, China:
The EU market for non-agricultural products (except for textiles and clothing products) is largely
open. The simple average applied tariff rate for non-agricultural products is 4.1%. However, certain
products such as textiles and clothing have much higher tariff rates (the highest simple average
applied tariff rate being 11.9%) and there is evidence of tariff escalation. Interested to know if the EU
has any plan to reduce the disparity by bringing down the tariff rates of these products.
A: The Commission disagrees with the qualification "except for textiles and clothing products"
contained in the question. In fact, the EU's average tariff in textiles is 9 % and as such is considerably
lower than those of most other countries, in particular exporting countries.
Future tariff reductions are subject to negotiations and the level of reduction will depend on the
ambitiousness of the approach shown by other Members.
The EU grants duty-free or reduced tariff treatm ent under preferential agreements and arrangements
to most of its trading partners. Imports from  nine WTO Members including Hong Kong, China are
subject to exclusively MFN treatment in all product sectors. We are interested to have information on
the proportions of preferential trade and non-preferential trade in the Community’s total trade for the
past five years.
A: EU trade with the 9 trade partners subject to exclusively MFN treatment in all products sectors
accounts for aproximately 35% of total EU trade. Other partners are (partially or exclusively) subject
to preferential treatment.
EU trade 1997-2001 with World and MFN partners
EU15 imports (million Euro) EU15 exports (million Euro) Total trade (million Euro) Year
MFN World Share MFN World Share MFN World Share
2001 326,408 946,637 34% 307,981 847,056 36% 634,390 1,793,693 35%
2000 347,810 949,511 37% 299,538 800,801 37% 647,349 1,750,312 37%
1999 274,641 705,503 39% 233,348 639,319 36% 507,989 1,344,822 38%
1998 257,543 641,339 40% 206,948 615,157 34% 464,491 1,256,496 37%
1997 227,675 606,049 38% 206,322 608,694 34% 433,997 1,214,743 36%
MFN US, Canada, Australia, New Zealand, Japan, Hong Kong, Singapore, South Korea, Chinese Taipei.
World Excluding intra-EU15.
Source: Eurostat COMEXT 13 Sep 02 (Statistical Regime 1).
Questions from Argentina:
En la nota a pie de página nro. 16 de la página 36 del Informe de la Secretaría se menciona que el
año 2000 se ofreció información sobre los precios estacionales de entrada para frutas y hortalizas
que se mantienen en vigor. ¿Existió algún cambio del régimen estacional desde mediados del año2000 a la fecha? ¿Podría la U.E. ofrecer información actualizada de los precios de entrada de esos
productos?
A: The Entry price system is published each year in the EC tariffs (See OJ L 279/2001 where all the
system / tariffs is/are laid down). There were  no changes from 2000 onwards. The UR commitmentsWT/TPR/M/102/Add.2
Page 41
have been fully implemented. The following countrie s have to pay the full duties: Australia, Canada,
Korea, Republic of Korea, United States, Puerto-Rico, The Northern Mariannes, Hong-Kong, Japan,New Zealand, Singapore, Taiwan, China.
En el párrafo 12 de la pagina 37 del Informe de la Secretaría se indica que la Unión Europea
concede un trato de franquicia arancelaria o de aranceles reducidos a casi todos sus interlocutores
comerciales, en virtud de acuerdos y arreglos preferenciales. ¿Podría la Unión Europea brindarinformación sobre los aranceles aplicados a las importaciones provenientes de países a los que no se
concede NMF?
A: The MFN clause is applicable to all countries, even non-WTO members. (Council Reg. 2658/87).
As regards duty rates other than MFN, such information can be find in the document TARICpublished at the Official Journal C104 A 30/02/2002 ISSN 03786986.
Question from Korea:
According to the Report by the Secretariat, the EU has reduced the tariff rates on some textile and
steel products annually.Please provide the concrete criteria for determin ing the reduction and information on long term plans
for further reduction.
A: The duty reductions currently applied by the European Communities for steel, textiles and clothing
are in accordance with the implementation of its UR commitments. As regards steel, duties for almost
all steel products will be eliminated by 2004. In terms of future reductions for the products in question
these will depend on the outcome of the current round of multilateral negotiations under the DohaDevelopment Agenda, as the EC is not interested in unilateral tariff reductions.
Question from Uruguay:
En el párrafo 25 (summary observations), se se ñala que, "El promedio aritmético de los aranceles
aplicados a los productos agropecuarios, cifrado en un 16,1%, es unas cuatro veces superior alcorrespondiente a los productos no agropecuarios, aplicándose promedios arancelarios más altos a
los productos sujetos a la PAC, habiendo progresividad arancelaria, en particular con respecto a los
productos elaborados".
La Declaraci6n de Doha estableció que, en el marco de las actuales negociaciones agrícolas en la
OMC, se debería alcanzar una mejora sustantiva de acceso a los mercados, c6mo piensa la UEinstrumentar este mandato?
A: It is an automatic calculation which does not take into consideration notably our preferential
regime. We would like to recall in this context that no reliable data on prices and no reliable data on
how much basic products needed to make a process product are existing. Consequently, estimateswhich were given are only purely statistical values.
Question from Mexico:
En materia de administración de cupos de importaci ón para productos pesqueros, particularmente para
algunos productos sujetos a cupos de menor tamaño, la UE utiliza el esquema "first como firstserved", indicando al exportador, en aduana, si puede beneficiarse del cupo. Este sistema presenta
problemas importantes de certidumbre para los exportadores, especialmente para aquellos que se
encuentran a distancias considerables del mercado comunitario. Sobre el particular, (i) ¿La UE ha
considerado modificar este sistema de forma que se ofrezca mayor certidumbre a los exportadores de
este tipo de productos? (ii) ¿En este contexto, la UE ha considerado implementar un sistema basado
en subastas en lugar del "first come first served"?WT/TPR/M/102/Add.2
Page 42
A: The quotas concerned are "tariff quotas" giving a lower customs duty on importation into the
Community than the normal customs duty. Benefit from the quotas is claimed by the importer andgranted to him. The Community uses the same management system for other tariff quotas applicable
to a variety of distant countries, for example for high technology products. The exporter plays no role
in any tariff quotas managed by this method except, in the case of quotas within the framework of
tariff preferences, to ensure that a preferential cert ificate of origin is provided to the importer. Up-to-
date information about the balances of these quotas is constantly available athttp://europa.eu.int/comm/taxation_customs/dds/en/
Question from Brazil:
What criteria does the EU use to levy specific or ad valorem tariffs on a given product? How aboutseasonal tariffs? Why is orange juice subject to specific seasonal and ad valorem tariffs besides beingsubject to a minimum price policy?
A: The use by EC of specific duties or of ad valorem duties and the reasons of the existence of some
seasonal tariffs result from the negotiating proces s of the Uruguay Round and of the former GATT
rounds of negotiation. Orange juice is not subject to seasonal tariffs and to a minimal price policy.Moreover, the fact that there is a WTO quota for orange juice has to be pointed out .
Question from Malaysia:
Para 2 of the Secretariat’s Summary Observations noted that the continued commitment of the EU to
the WTO and the multilateral trading system will be  critical to the success of the Doha Development
Agenda. How does this commitment square off with continued high tariffs on agricultural goods and
processed products, frequent resort to anti- dumping actions, and imposition of stringent standards
that could become significant barriers to trade.
A: The current level of the EC protection is not higher than the average level of protection of other
developed countries. Moreover, a big majority of DCs do not face tariff escalation/tariff peaks on the
EC market, as it is already very open to them (G SP, EBA, ACP, MED). The benefits for LDCs and a
lot of other DCs (ACP, MED) will be much greater  if other developed countries and the wealthiest
developing countries follow the lead of the European Union in the field of preferential regimes for
DCs. Such approach could also permit to solve the main problems of tariff escalation and tariff peaks,
which impede most of the developing countries’ exports to developed countries and wealthiest
developing countries.
Question from India:
In Para 25 of Summary Observations, the WTO Secretariat notes that the average tariff on
agricultural products is 4 times higher than that on non-agricultural products. It further notes that the
evidence of tariff escalation remains, in particular on processed products. Agricultural exports are ofgreat importance to developing countries. We would like to know from EU about its plan to eliminate
these tariff peaks and escalation.
A: A big majority of DCs do not face tariff escalation/tariff peaks on the EC market, as it is already
very open to them (GSP, EBA, ACP, MED). The be nefits for LDCs and a lot of other DCs (ACP,
MED) will be much greater if other developed countries and the wealthiest developing countries
follow the lead of the European Union in the field of preferential regimes for DCs. Such approach
could also permit to solve the main problems of tariff escalation and tariff peaks, which impede most
of the developing countries’ exports to developed countries and wealthiest developing countries.WT/TPR/M/102/Add.2
Page 43
In Chapter III, Para 11, the Secretariat Report notes that the range of applied tariffs for agriculture
products is from 0 to 470.8% and on non-agricultural products is from 0 to 36.6%. We would like EUto indicate as to what parameters are taken into account for setting tariffs?
A: The calculation of the Community’s specific duty rates into ad valorem equivalents is purely
technical and automatic. No account has been taken of the fact that reliable price data is needed to
convert specific duties into ad valorem equivalents. Such reliable data does not exist in many cases forvarious reasons (imported quantities and/or quality of imported products are not always
representative; absence of world price…). Another important issue which should be underlined is the
difficulty to estimate the duties for processed products, which often include various components in
variable quantities, which are themselves subject to different duties (data on how much raw materials
are required for producing a particular processed product does not exist). Morever, no account hasbeen taken, neither of quantities being imported under tariff quotas (with low duty rates), nor of any
preferential duty rates. Consequently, in particular for the reasons listed above it is clear that the
results do not give a reliable picture of the Community’s level of tariff protection or tariff incidence.
Question from Thailand:
The EU’s tariff bindings on agricultural products are based on specific rates, which poses
considerable hindrances to the assessment of tariff reductions and a new round of agricultural
negotiation. Please indicate whether the EU has any plan to convert applied tariffs from specific rates
to ad valorem rates.
A: The EC estimate that it is not possible to solv e this problem in a reliable way for the following
reasons:Reliable price data are needed to convert specific duties into ad valorem duties. Such relable data do
not exist in many cases for various reasons (Import quantities and/or quality of imported products are
not often representative; Custom imported values are often under-invoiced or over-invoiced; Absence
of world price; Difficulties to calculate derived prices from world prices for processed products).
Data on how much ra material is needed for producing a particular processed product does not exist.Processsed products include various components in variable quantities which are themselves subject
to different duties.
No account is taken in the conversion attempts made by some, neither of quantities imported under
tariff quotas, nor of any preferential duty rates.
(v) Indirect taxes
Question from Mexico:
El gobierno belga ha sometido a consideración de la Comisión Europea un proyecto de legislaciónpara imponer un impuesto denominado “ecotasa” so bre los envases de bebidas no reutilizables. La
medida propuesta tiene como objetivo obligar a los exportadores de bebidas, a reenviar sus envasesal sitio de producción, para ser lavados y re llenados, o bien, a pagar el impuesto. La medida
propuesta, de implementarse, discri minaría a las bebidas importadas de diversas formas. Mientras
mayor distancia exista del centro de producción mayor es la discriminación. Adicionalmente, a través
de distintas reducciones a los impuestos llamados”ac cisas”, el impacto de la ecotasa será desigual
para las diferentes bebidas, afectando de manera más importante a bebidas tales como la cerveza. Loanterior, no obstante que actualmente existe un mecanismo de reciclaje en Bélgica (FOST PLUS),
que, de acuerdo a las cifras más recientes, ha sido un claro caso de éxito y en el cual participan los
principales importadores de bebidas. En este se ntido, (i) ¿Considera la UE que la medida propuesta
por Bélgica es compatible con sus compromisos asumidos en la OMC? ¿En caso de aplicarse, cuál
sería el impacto de la medida propuesta en las im portaciones comunitarias de bebidas? ¿La UE haWT/TPR/M/102/Add.2
Page 44
considerado cual sería el impacto en las exportaciones comunitarias de bebidas si países terceros
adoptaran medidas similares a la propuesta por el gobierno belga?
A: The EC considers that fiscal measures do not fall under the TBT Agreement.(a) VAT
Question from Canada:
Paragraphs 13 and 14 mention that all EU Member States apply VAT and excise taxes to imported
products at rates that, in accordance with the national treatment principle, are the same for goods
supplied within the territory by the taxable person. We understand that off-line delivery of goods
resulting from e-commerce through imports into th e Community are subject to VAT on the bases of
the national-treatment principle. For all non-EU e-commerce transactions, VAT is assessed on goodssupplied within the Community on the basis of the de stination principle. VAT is applied at the point of
origin up to a threshold (between 35,000 to 100,000 euros) for sales established by the Member State
of destination. Please indicate if the EU will maintain such a threshold. If so, please explain the
differences between the process for non-EU exporters and those from the EU.
A: Firstly, the threshold referred to by CAN a pplies only to intra-Community transactions to non
taxable persons (ie individuals) and not to imports; therefore, Canada should not be concerned with
this; anyway, to reply to their question, there are no plans at this stage to amend this rule - however, as
a general policy, the EU (Commission) examines on regular basis the VAT legislation to see whether
improvements can be made: in this context, it can not be excluded that the "threshold rule" may be
changed in the future.
Secondly, we have to distinguish between goods and services:- for goods, national treatment principle applies, ie the VAT is applied by the Member State of
importation (see above),
- for services (on-line delivery), as of now, in case of supply from non-EU countries, no VAT is
charged, as the place of supply is deemed to be the place where the supplier is based (eg Canada,
where it would be considered as export and therefore exempted); however, VAT is charged for
supplies from a Member State to another; this will be changed by the new E-commerce Directive (to
enter into force on 1.7.2003), which will require VAT to be charged at destination, ie - in case of
supply from a non-EU company to a EU custom er - in the Member State of destination.
This implies that:
- for non-EU "exporters" (eg a Canadian comp any supplying to EU customer) of on-line
services, at present, no VAT is charged
- for EU-"exporters" (eg a EU company suppying to  another Member State's customer - intra-
EU transaction, or outside the EU), VAT is charged where the supplier is based (origin).
As mentioned, the new E-commerce Directive will change as follows:
- For supplies by suppliers established outside of the EU to taxable persons in the EU, the
reverse charge principle applies.
- For supplies by suppliers established outside of  the EU to non-taxable persons in the EU, the
non-established taxable person (the supplier) will have to register for VAT in the EU and
charge VAT in the Member State of consumption. Accordingly, it is the non-established
taxable person, not the Member State, that collects the VAT.
- For supplies by suppliers established inside the EU to taxable persons in the EU, the reverse
charge principle applies.
- For supplies by suppliers established inside the EU, the origin principle applies.WT/TPR/M/102/Add.2
Page 45
Question from Taiwan:
In December 2001, the ECOFIN Council endorsed a political agreement on VAT for goods and
services sold through e-commerce, such as games, films, music, software, website hosting and remote
programme maintenance. According to this new directive, taxation on services or products provided
through electronic commerce should be levied withou t regard to the locations of the suppliers. It is
therefore consistent that non-EU suppliers should be required to register for VAT in the EU Member
State of their choice and then, once the transaction is conducted be charged VAT by that member at
the VAT rate applying in the consumer’s country of residence. The VAT will then be handed over to
the EU country where the consumer resides. However, overseas suppliers face the complications
which arise from dealing with 15 member states all applying different rates of VAT. The whole
process of collecting VAT therefore places a greater compliance cost on overseas suppliers. We
would suggest that the EU take these problems re lating to electronic commerce into consideration
when harmonizing VAT among the member states.
Taxation is far from harmonized am ong EU countries. We would like to have some indication of EU
policy as to future harmonization of taxes, especially VAT.
A: First of all, it should be mentioned that the e-commerce Directive, to which the question refers,
only deals with supplies of services and not goods. For goods supplied off-line over the internet, they
will be as usual considered as importations in the EU, and therefore taxation will occur in the Member
State of import.
With regard to on-line services, when they are supplied to taxable persons, there a reverse charge
mechanism is applied, addressing the concern raised by Taiwan.
Finally, with regard to electronically supplied services supplied by non-EU-established business to
non taxable persons (eg individuals) in the EU , non-EU-established traders may profit from a
simplified scheme for fulfilling their VAT obligations: thanks to this scheme, they will be able to
register on line and file declarations on line. Although they will have to charge the VAT of the
Member State where their customers are established, this should not raise any serious difficulties,
having regard to the fact that they operate in  an automated environment. Moreover, the non-EU-
established trader can always opt to create a fixed establishment in the EU and then be treated as anyother EU-established trader who s upplies to EU clients (i.e. he will charge the VAT of the MS where
he has the fixed establishment for supplies to non taxable clients).
As regards the EU policy, the general EU policy wi th regard to VAT aims at further harmonisation,
simplification and modernisation of the current EU VAT provisions. However, no further specific
details can be provided at this stage.
(b) Excise duty
Question from Switzerland
To paragraph 15: For which reasons the overall excise duty for cigarettes in the most popular price
category will be raised to EUR 64 as from 1 July 2006, and only from 1 January 2008 for two
Members?
A: Article 4.2 of Directive 2002/10/EC provides that  Spain and Greece are authorised to raise the
minimum duty on the MMPC to Eur 64 by 1 January 2008 at latest. All other Member States,
according to Article 1 of the said directive, have to reach the Eur 64 level for the MMPC as from 1July 2006.
This text is the result of the legislative process of the EU (ie Council decision on the basis of a
Commission proposal) and takes in to account, amongst other factors:
- the general aim of reducing divergencies in the absolute level of taxation of cigarettes in the
MSs,WT/TPR/M/102/Add.2
Page 46
- the different levels of duties from which the various Member States are starting, ie the
different effort required from each MS.
By means of the approved text, the final aim of reducing the absolute differences in taxation levels is
achieved, while allowing a smooth transition for those MSs, from which a greater effort is demanded
(as they start from lower levels).
(vi) Prohibitions, restrictions, surveillance, and licensing requirements
(a) Common Foreign and Security Policy (CFSP)
Question from Canada:
Paragraph 16 states that the EU and Member States are participating in international efforts to
combat illicit traffic in diamonds. Please indica te if this participation exceeds the requirements
negotiated under the Kimberly Process. If so, please indicate to what extent.
A: Indeed the EU and Member States are participating in international efforts to combat illicit traffic
in diamonds within the framework of the Kimberley Process aiming at setting up an international
certification scheme for rough diamonds. Following UN Resolutions, the EU has also taken restrictive
measures against some African countries, such as Angola, Sierra Leone and Liberia, prohibiting theimportation of rough diamonds into the Community not accompanied by a certificate of origin
delivered by the national Governments.
(b) Protection of the consumer, the environment or animal welfare
Question from Canada:
Paragraph 18 mentions that the ban on remaining uses  of chrysotile asbestos, which had been noted
in the last Review of the EU, is to be made effective by 2005. Relating to this, the Commission
Directive 1999/77/EC of 26 July 1999, adapting A nnex I of Council Directive 76/769/EEC to
technical progress, requires that the Commission ask the Scientific Committee on Toxicity,
Exotoxicity and the Environment to undertake a review of new scientific data on the health risks of
chrysotile asbestos and its substitutes before January 1, 2003 and if necessary, to propose
appropriate changes to legislation. Given increasing evidence regarding the negative health effects ofsubstitute fibres, please indicate which substitute fibres are currently under review and what trade
related restrictions, if any, are anticipated as a result of this review.
A: Firstly, in 1998, before the adoption of Directive 1999/77/EC, the Scientific Committee on
Toxicity, Eco-toxicity and the Environment (SCTEE) made a comparative risk assessment analysis ofchrysotile asbestos and its main substitutes (cellulose fibres, polyvinyl alcohol fibres (PVA), P-aramid
fibres). That risk assessment confirmed the carcinogenic properties of all asbestos fibres. The SCTEE
also concluded that the main asbestos substitues ar e less likely to induce cancer or fibrosis of the lung
in man than chrysotile.
Nevertheless the SCTEE also suggested that further studies should be carried out in order to bettercompare acute and sub-acute toxicity of the asbestos substitutes mentioned above.
The SCTEE suggestion was incorporated as the tenth recital of Directive 1999/77/EC and in
consequence the Commission asked the SCTEE in April 2002 to update its 1998 opinion, e.g. to
undertake a further review of any relevant new scientific data since 1999 on the health risks of
chrysotile asbestos and its main substitutes (cellulose fibres, PVA, P-aramid fibres).The SCTEE has almost finalised its conclusions which will be available at the end of this year. Once
the outcome of the review is known, we will be able  to answer the question relating to restrictions,
although it should be noted that the restrictions that we impose, if appropriate, are restrictions on the
marketing and use: they are not trade restrictions.WT/TPR/M/102/Add.2
Page 47
Question from Taiwan:
The EU adopted a new instrument for food safety in February 2002 to suspend the introduction and
import jelly confectionary containing the food additive E 425 konjac in the EU market. However,
konjac has been used as human consumption in As ia for many years and scientifically proven to be
healthy food product. Therefore, could the EU explai n why konjac was treated as a life threatening
food product? Are there any scientific evidence to support that konjac does not meet the requirement
of EU’s food safety standard?
A: The Commission suspended the marketing in the EU of jelly confectionery containing the food
additive konjac (E 425) in March 2002 (Commission Decision 2002/247/EC).
The Commission adopted this measure due to the choking hazard the jelly mini-cups constitute,
especially to children. The consistency of jellies is such that they slip easily and are less likely tocause the coughing reflex than harder objects. Moreover, konjac forms a very strong gel that does not
melt easily in the mouth and in addition to the consistency, the size and the shape of these products
constitute a risk. A warning label that some manufacturers already include on the product highlighting
the risk for children and the elderly is insufficient to protect children. A Community measure was
necessary as several Member States had already take similar measures whereas some Member Stateshad not taken any. E 425 konjac was suspended in all jelly confectionery, as they may pose the same
risk as jelly mini-cups.
Please note, E 425 konjac is authorised for use in foodstuffs in general bu Directive 95/2/EC on food
additives other than colours and sweeteners (with certain restrictions in unprocessed foods and with a
maximum use level). This authorisation has not been changed. The restrictive measure on the use of E
425 konjac is only directed to the application in jelly confectionery.
Questions from Australia:
The EU has identified animal welfare as a non-trad e issue that needs to be addressed by the WTO.
What could the WTO do that nati onal governments cannot already do to respond to the animal
welfare concerns of their domestic constituents?
A: Animal welfare, which is an increasing societal goal in Europe as in other countries, entails
additional costs that may justify legitimate comp ensation for farmers. The EC propose different
options to address such a non-trade concern issue: 1) the development of multilateral agreements, 2)
appropriate labelling rules, and 3) exemption of the compensation of additional costs or income
foregone to meet animal welfare standards, from reduction commitments. All of these options arecumulatif and not exclusive. It should be discussed in the WTO.
How does the EU balance its need for domestic regu latory reform, including the need to respond to
particular consumer concerns, with its commitment to the multilateral trading system and without
introducing measures which unnecessarily restrict international trade?
A: The EC considers that there is no contradiction between NTCs and further liberalisation.
Moreover, it is no intention of the EC to use NT Cs in a protectionist view. The Doha declaration
states that the Non-Trade Concerns (NTCs) reflected in the negotiating proposals will be taken into
account in the negotiations.
How will the EU ensure consistency across Member States in the implementation of environmental
liability regulations? If this coordination and consistency is not possible, how will the EU manage the
negative impacts on trade in goods?
A: Once the proposal is adopted [proposal for a Directive of the European Parliament and of the
Council on environmental liability with regard to the prevention and remedying of environmentalWT/TPR/M/102/Add.2
Page 48
damage - COM(2002) 17 final of 23 January 2002 (OJ C 151 E, 25.6.2002, p. 132)], environmental
liability will be regulated within the EU through a Dire ctive, i.e. an instrument that is binding, as to
the result to be achieved, upon each Member State to which it is addressed while leaving to the
national authorities the choice of form and methods to achieve the prescribed result.
The Commission proposed to adopt this new legislation on the basis of Article 175 of the EC Treaty,
because of its environmental objective. This means that Member States may, where appropriate, rely
on Article 176 of the EC Treaty, which allows Member  States to maintain or introduce more stringent
protective measures, provided that they are compatible with the EC Treaty. In any case, Article 18 of
the proposal explicitly confirms the right of Member States to maintain or adopt more stringent
provisions in relation to the prevention and remedying of environmental damage.
The European Court of Justice has jurisdiction to give preliminary rulings concerning the
interpretation of the future Directive to ensure its uniform application throughout the Union.Should any Member State fail to implement and enfor ce the future Directive, insofar as the minimum
requirements established therein would not be comp lied with, the review procedures provided for in
the Directive could be used at national level, while the Commission may lodge an action before the
European Court of Justice against the Member State concerned for failure to fulfil its obligations
under the Directive.Conversely, the Commission may not bring a case before the European Court of Justice when a
Member State fails to ensure a proper enforcement of the more stringent provisions it has adopted on
an unilateral basis.
It follows from the above that, from a strict lega l viewpoint, no uniform implementation of the future
Directive on environmental liability may be ensured. However, this is only the case for more stringent
provisions - the Directive would ensure, as a minimum requirement, that the Polluter Pays Principle is
both applied and enforced. In particular, any damage  to the environment would need to be remedied
through restoration of the damaged site and/or additional improvements to the environment. It can
therefore be said that the future Directive shou ld be a major improvement in comparison with the
current situation, where some operators could derive an economic advantage from the absence of
liability for purely ecological damage. In other word s, the common basis that should result from the
adoption of the future Directive would be to remove any real risk of distortion.In addition, it does not seem that the issue of the uniform application of the future Directive on
environmental liability could have any noticeable impact on international trade in goods, as evidenced
by the fact that diverging national liability laws exist does not seem to have a noticeable adverse
impact on international trade in goods. It should be noted in that respect that the proposal exempt
from its scope damage caused by incidents regulated by relevant international conventions.
Questions from Mexico:
En el párrafo 17 del capítulo III del IS se menciona que todos los productos de consumo están sujetos
a un requisito general de seguridad, salvo en el caso de los productos para los cuales la Comunidad
o los Estados miembros han establecido reglamenta ciones o normas específicas. ¿Puede la UE
señalar en qué consiste ese requisito general de seguridad? ¿Puede indicar de qué depende que la
Comunidad o los Estados miembros establezcan tales reglamentaciones o normas y cuántos
productos están sujetos actualmente a reglamenta ciones o normas comunitarias o estaduales?
A: El requisito general de seguridad (contenido en la Directiva 2001/95/CE) consiste en establecer la
obligación de que todos los productos de consumo tienen que ser seguros de modo que tales
productos, en condiciones de utilización normales o razonablemente previsibles, incluidas las
condiciones de duración y, si procede, de puesta  en servicio, instalación y de mantenimiento, no
presenten riesgo alguno o únicamente riesgos mínimos, compatibles con el uso del producto y
considerados admisibles.WT/TPR/M/102/Add.2
Page 49
Además de esta directiva general existe una colección de directivas sectoriales que rigen los aspectos
de seguridad y los riesgos de categorías específicas de productos tales como los juguetes, losproductos eléctricos, los cosméticos, etc.
Toda esta legislación tiene como objetivo, además del correcto funcionamiento del mercado interior,
conseguir un nivel de protección elevado de la seguridad y de la salud de los consumidores.
En el párrafo 18 del capítulo III del IS se señala que la lista de sustancias peligrosas abarcadas en la
reglamentación comunitaria respectiva se actu aliza periódicamente para reflejar los progresos
técnicos. ¿Puede la UE aclarar cada cuánto tiempo se lleva a cabo esa actualización y si la misma
está sometida a consulta pública?
A: The list of dangerous substances in Annex I of Directive 67/548/EEC is updated on about a yearly
basis. The preparatory work for DG ENV is done by the European Chemicals Bureau (ECB) in Ispra
(part of JRC) with the assistance of technical experts from industry and Member States. There is no
formal public consultation, but the preparatory work and results of discussions by experts are put on
the ECB website.
En el párrafo 22 del capítulo III del IS se indica que las importaciones de las especies abarcadas en
el Reglamento 3254/91 del Consejo, se encuentran su jetas a certificación. ¿Puede la UE describir en
qué consiste el proceso de certificación del que se habla y si ha reconocido o permitirá el
reconocimiento mutuo de los resultados de certificaciones realizadas en el extranjero?
A: Commission Regulation (EC) No 35/97 of 10 January 1997, which lays down provisions on the
certification of pelts and goods covered by Council Regulation (EEC) No 3254/9, provides that theimporter or his authorised representative shall surr ender a certificate to the border customs office at
the point of introduction into the Community which has been issued by a competent authority of the
exporting or re-exporting country. The forms on which this certificate is drawn up shall conform to
the model shown in the Annex of this Commissi on Regulation. The competent authorities designated
by third countries for the issue of this certificate shall be notified to the Commission, which shallinform the MS and upon request, any interested third party thereof.
Council Regulation (EEC) No 3254/91 of 4 November 1991 is prohibiting the use of leghold traps in
the Community and the introduction into the Community of pelts and manufactured goods of certain
wild animals species originating in countries which catch them by means of leghold traps or trapping
methods which do not meet international humane trapping standards. The Council Regulation iscompleted by a Decision listing those countries from whom specific animal pelts and manufactured
goods can be accepted. The latest such decision is Commission Decision (98/596/EC) of 14 October
1998. Those countries allowed to import need to provide the certificate mentioned. Furthermore, the
Community reached an Agreement with Canada and the Russian Federation on international humane
trapping standards. A somewhat similar package but with the status of Agreed Minutes was reachedwith the USA. These Agreements provide that trade sanctions are not imposed between signatories if
they meet the obligations of the Agreements.
Question from Brazil:
In document WT/TPR/S/102, chapter III, paragraph 17, th e EU informs that the entry of products for
consumption in its market is subject to compliance with the general requisite of safety, except for food
products, to which specific rules apply. What products are banned from commerce within the EU
based on that requisite?
A: Products that can be banned through this Directive are dangerous consumer products not subject to
vertical/sectoral product legislation such as for instance dangerous child products (except toys),
lighters, laser pointers, furniture, ladders etc.WT/TPR/M/102/Add.2
Page 50
The decisions to ban are taken by Member States and notified to the Commission, in emergency cases
through the Rapid Alert System (RAPEX).The directive also provides for a possibility to ban products on Community level. Only one such
examples exists: phthalates in certain child-products.
More information is available on the website of DG SANCO
http://europa.eu.int/comm/consumers/index_en.html under "Safety of products and services".
In document WT/TPR/S/102, chapter III, paragraph 19, it  is stated that “through a common system of
notification and information for imports from and expor ts to third countries, the EU controls the trade
of certain chemicals that are banned or severely restricted on account of their effects on human
health and the environment. Which are those pr oducts and what are the criteria adopted for their
selection?
A: The chemicals are those listed in Annex I of Regulation 2455/92 implementing voluntary
FAO/UNEP arrangements on prior informed cons ent (PIC), now subsumed in the Rotterdam
Convention. These chemicals are banned or severly re stricted under other Community legislation (e.g.
Directive 76/769, 79/117, 91/414) in order to protect human health and the environment.
The Commission adopted, on 7 December 1999, the Decision 1999/815/CE, requiring Member States
to prohibit the placing on the market of toys and childcare articles containing phthalates and destined
to children under three years of age. No convincing scientific explanation was given for that. The
validity of the decision was initially limited to three months. However, through decisions by the
Commission, that measure has been successively pr olonged by periods of three months. Could the EU
inform if there are new developments in this regard? When does the EU intend to suspend the
prohibition?
A: The Decision has been prolonged for 10 consecutive 3-month periods with the last one expiring on
the 20th of August 2002. The 11th prolongation is now being prepared. The prolongation for thedecision is deemed necessary to ensure a high level of protection of small children because of the
continued health concerns associated with the use of these phthalates in soft PVC toys intended to be
put in the mouth. At the same time the prolongation of the Decision banning these phthalates is
needed to allow sufficient time for discussions in the Council over the Commission proposal to amend
Directive 76/769/EEC (the Limitation Directive) which will implement the ban on a permanent basis.
(c) Textiles and clothing products
Question from Korea:
The Report by the Secretariat indicated that the EU has applied different quota growth rates for
textiles from 0.18% to 16.37%, and that higher gr owth rates are applied to imports from some
developing countries.
Please provide the concrete criteria justifying the difference in the quota growth rates.
A: Growth rates are negotiated and must be seen in conjunction with the resulting base levels. This
being said, more fovourable treatment of small and least developed suppliers are fully in line withcondiserations underlying the Uruguay round.
Questions from Brazil:
In document WT/TPR/S/102, chapter III, paragraph 24, it is stated that the third stage of integration
of the ATC “concerned 18.08% of 1990 imports of 3.9 million tones, bringing to 51,39% the imports
integrated into GATT 1994 since 1995”. In terms of value of trade, how much does this represent,
according to statistic data from 2001?WT/TPR/M/102/Add.2
Page 51
A: In the third stage of integration of the ATC the European Union integrated 11 product categories
resulting the liberalisation of 57 bilateral quotas. In terms of trade value this represented more than22% of the 2000 value of imports in the textile and clothing sector.
In document WT/TPR/S/102, chapter III, paragraph 27, the Commission informs that it has signed
Memoranda of Understanding with many exporters of textile and clothing products (India, Pakistan
and Sri Lanka) in the expectance that it would receive in exchange concessions in market access. Itadds that other Memoranda are being negotiated. W hat other countries would benefit from those
Memoranda and what kind of concessions does th e Commission have in mind for those negotiations?
A: Several of our partners have indicated their interest for concluding a Memorandum of
Understanding ;the most recently concluded but not yet enforced is the Memorandum ofUnderstanding between the EU and Brazil. The Euro pean Union remains open to initiate discussions
with any other interested partner.
Questions from India:
The Secretariat in Para 26 of Summary Observations notes that to date EU has lifted restrictions on
20% of products restricted in 1990, leaving the elimination of remaining 80%of restricted imports
"back-loaded” for the final stage at the end of 2004. At the beginning of the ATC, EU had 219 quotas
(with respect to WTO members). In the first stage of integration (effective from 1.1.1995) no quota
was integrated; in second stage (effective from 1.1.1998) it integrated 14 quotas while in third stage
(effective from 1.1.2002) it has integrated 38 quotas. None of these quotas pertain to major items in
which exports from restrained developing economies are concentrated. Therefore EU has practically
kept quotas in all the Categories. India believes that this approach frustrates the real motive of theATC. We would like EU to comment on this aspect.
A: Under the WTO Agreement on Textiles and Clothing (ATC), the EU has pledged to bring into the
multilateral rules all covered (in 1990) textile and clothing products by 2005.The European Union has
fully respected the letter as well as the spirit of the liberalisation process foreseen by the ATC. Of the3.9 million tonnes of textiles and clothing imported in 1990, the EU integrated 16.2% in 1995,
17.11% in 1998 and 18.08% on 1 January 2002 (18%), the final stage will be on 1 January 2005. In
1990 52 product categories were subject to quantitative limits. In the second stage 12 product
categories were integrated while in the third stage 11 more product categories were integrated.
Therefore it is not accurate that the EU has kept quotas in all the categories. The bilateral quotaseliminated in consequence -for both stages and including the bilateral quotas applied to China- were
82 in total.
The current practice followed in EU is that a shipment over the category limit exported to EU is
returned back to be shipped again. This methodology of EU for end of year shipment is at variance
with the practice followed by USA and Canada- the other two restraining countries- who allow end of
year shipment over the category limit to be booked to the next year. Does EU propose to amend its
methodology in near future?
A: The EU does not propose to amend this methodology in the near future. The management and the
issuing of export licences belongs to the exporting country; this latter has the responsibility to take the
necessary measures in order to avoid the issuing of an excessive number of export licences.
The Category 2(a) is a sub-category of overall category 2. EU is found to be taking the stand that the
quotas need to be integrated much faster and individual negotiations have also been held by EU on
this account. Will EU consider making Category 2 as overall category and keeping no sub-limits on
Category 2(a) as such?WT/TPR/M/102/Add.2
Page 52
A: For the moment sub-category 2A is not  subject of any integration proposition.
As per Article 1:4 of the ATC, the particular interests of cotton producing exporting members were to
be reflected in the implementation of the provisions of the ATC. However, restraining countries like
EU have not taken the initiative to implement the provision of Article 1:4 of ATC. We would like to
know from EU the justification for the same.
A: The EU has been always ready to examine at any moment proposals from interested third parties
including supplier countries, regarding the implemen tation of the ATC and in particular at the time it
prepared the  different phases of its integration program. In this respect, the particular position of cotton
products was duly and thoroughly examined to take into account all relevant aspects.
In some European markets textured yarn is to be supplied in equal length packages only. This causes
unnecessary cost addition for exporters. Will it be possible for EU to waive this requirement?
A: We are not aware of any such national legislation; it most probably to specific market requirements
from the industry in which case, even if the relevant legislation is waived, the buyers will still request
it and prefer the companies who can supply this type of products.
Will EU indicate the share of customs revenue receipts accruing to it from textile and leather imports
originating in developing countries in its overall customs revenue receipts?
A: Such data are not collected. As a result the type of breakdown that would be required to reply to
this question cannot be offered. However, we would be willing to discusss bilaterally about the
objective that such data would serve, trying to see if it would be possible to attain in any other specific
way.
Questions from Thailand:
The EU has concluded four memoranda of understanding with 3 individual developing-country
exporters of textile and clothing products, including India, Pakistan and Sri Lanka. For the purpose
of keeping us up to date on this area, we would be grateful if the EU could provide information on therecent developments regarding those countries that have been targeted for negotiation or have
concluded memoranda or in the process of negotiation with the EU.
A: Several of our partners have indicated their interest for concluding a Memorandum of
Understanding; the most recently concluded but not yet enforced is the Memorandum ofUnderstanding between the EU and Brazil. The Euro pean Union remains open to initiate discussions
with any other interested partner.
So far 7½ years of the 10-year transition period elapsed. EU has implemented its first three stage
integration programmes. According to our analysis, it is noted that even though 52.37% of its ATC
imports have been integrated into GATT 1994, but if you look from the context of restrained trade,
only 32.38% of its ATC restrained trade are integrat ed. In other words, about 67% of restrained trade
will remain in place on 31/12/2004 and be liberalized on 1/1/2005 unless the EU takes positive steps
on its own at an earlier date. What does the EU have in mind to do during the run-up to 2004 to
facilitate such a large scale of change overnight and avoid upheavals in the marketplace?
A: Most of EU's textile bilateral quotas are not highly utilised and therefore are not often a major
restriction to imports. in 2001, out of a total 299 quotas applied vis-à-vis WTO countries, only 40
were utilised at 95 % or more, or just 13,4 % of the total number of quotas. Moreover all bilateral
quotas will be yearly increased on the basis of growth on growth rates.WT/TPR/M/102/Add.2
Page 53
In parallel, as other importing members will eliminate their quotas as of 01 01 2005 it is expected that
their markets will also offer export possibilities. Finally It is also probable that imports from thecurrently restricted exporting countries will increase partly in detriment of the market share of other
suppliers for which no quotas are currently applied.
For the above mentioned reasons we don't expect a dramatic "overnight" pressure in the market.
The current applied annual growth rates to quot as by the EU are the lowest among the three
restraining WTO Members. The EU has an average annual growth rate of just 6% right now as
compared with 7.06% and 8.70% by the US and Canada. Does the EU currently plan any
improvements in this area to increase competition in the market?
A: The annual growth rates applied to quotas by the EU vary according to the product category but
also the supplying country; as a result indicating the average annual growth rate does not give an
accurate picture. In fact the overall impact of these annual growth rates is quite positive: the volume
of the quantitative restrictions will more than double between 1994 and 2004.
Questions from China:
More than 7 years have elapsed since the ATC was put into effect. Many textile products are now still
subject to the serious import quotas by EU whic h greatly impairs the market access opportunities
legitimately expected through the implementation of ATC by textile exporting members including
China.
We would like to urge the EU to respond positively the request of the textiles developing producing
members and accelerate their implementation of the ATC.
A: The Commission would like to point out that it  has faithfully complied with the requirements of
the ATC concerning integration during the three stages.
In this connection attention is drawn to the fact that China became a member of the WTO only on the
11 December 2001, i.e. at the very end of stage 2 of the ATC integration process. Notwithstandingthis late adherence to the WTO, the Community granted China the full benefit of growth inherent in
the full period of stage 2 of the ATC, namely 25%, which was increased by 27% as prescribed for the
last stage of integration on the ATC as from 1st January 2002. Needless to say that a less positive
interpretation might have been applied by the Community under the provisions of paragraph 241 of
the report of the Working Party on China's accession, prescribing that growth rates should be applied"as appropriate" following China's membership of the WTO.
As we know, EU still maintains most stringent qu antitative restrictions on the products from certain
WTO members including China. We would like to re quest clarification as to whether EU has any
specific a plan in place to implement its relevant commitments to phase out these restriction inaccordance with their commitments.
A: The EU has indeed a system of quantitative rest rictions on imports of certain footwear and ceramic
products originating in the PRC, based on Council Regulation (EC) No 519/94
3 (as last amended by
Council Regulation (EC) No 1138/984) and Council Regulation (EC) No 520/945, establishing a
Community procedure for administering these quotas. Council Regulation (EC) 738/946 (amended by
                                                     
3 OJ No L 67, 10.3.1994, p.89.
4 OJ No L 159, 3.6.1998, p.1.
5 OJ No L 66, 10.3.1994, p. 1.
6 OJ No L 87, 31.3.1994, p. 47.WT/TPR/M/102/Add.2
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Council Regulation (EC) No 983/967) laid down the general rules for the implementation of Council
Regulation (EC) No 520/94.In June 2002 the European Commission made a proposal for a Council Regulation entitled "Council
Regulation on a transitional product-specific safeguard mechanism for imports originating in the
People’s Republic of China and amending Council Regulation (EC) No 519/94 on common rules for
imports from certain third countries". Title II and Annexes I and II of this Regulation establish the
phasing out of the quota system until the end of 2004 in line with the calendar contained in theAccession Protocol of the PRC to the WTO. The Commission proposal is currently under discussion
in the Council. It is expected that the proposal  will be adopted by the Council later this year.
(d) Licensing
Question from Canada:
Paragraph 34 states that in addition to imports of textiles and clothing products subject to quotas,
surveillance, or consultation, the Community requires licensing of imports from WTO Members of
certain agricultural products subject to common market organization – cereals, rice, beef and veal,
sheepmeat and goatmeat, milk and milk products, sugar, processed fruit and vegetables, bananas, oil
and fats, seeds, and wine – which, according to the Commission, serves a statistical purpose and is
granted automatically. Please specify if under WTO legislation, statistical purposes justifies the
burden posed by the usage of licensing.
The same paragraph states, “A licence is also required to import within a tariff quota, which applies
to a large number of agricultural products.”
Tariff quotas should be administered in ways that do  not impede the full utilization of market access
opportunities. As part of this, it is important for importers and exporters that a country providesreadily-available transparent information to traders on its tariff quota administrative procedures, and
related terms and conditions. This would also incl ude other information such as timely updates on
tariff quota fill rates. In Canada’s case, we provide easily- accessible information on the
administration of its agricultural tariff rate quota, applicable tariff rates, and the size of the access
commitment, as well as relevant inquiry points in its Notices to Importers, available on a web site
maintained by the Export and Import Controls Bureau. Moreover, this site provides frequent updates
on tariff quota fill rates to enable traders to fill opportunities throughout the quota period.
Canadian exporters have had difficulties finding read ily-available sources of information from EC
authorities. Does the EU maintain Enquiry Points to provide such information, as suggested by the
European Communities (G/C/W/363) in the discussi ons on Article X in the work program on trade
facilitation under paragraph 27 of the Doha Ministerial Declaration?
A: For a large majority of quotas there is the electronic data base of DG TAXUD which give an
updated each day which can be consulted by all operators. For others, they are managed by DG
AGRI, import certificates are delivered many days before importation of the products.
Question from Korea:
As of January 2002, the EU has reintroduced the licensing requirement for steel products. Although
the license is granted automatically upon application, the requirement results in an additional burden
for importers who have to prepare various documents for the application and thus this requirementfunctions as a trade barrier. Does the EU have any plans to eliminate this requirement?
A: Commission Regulation (EC) No 76/2002 of 17 January 2002 introduced prior Community
surveillance of imports of certain iron and steel products covered by the ECSC and EC Treaties. This
administrative procedure, according to which importers of the products in question are required to
                                                     
7 OJ No L 131, 1.6.1996, p. 47.WT/TPR/M/102/Add.2
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apply for surveillance documents, has as its sole purpose the provision of statistical information
permitting rapid analysis of imports. These surveillance documents will be issued automatically,without charge and for any quantities requested.
This measure was triggered by the worsening situation of the international steel market observed from
the middle of 2001. This deterioration was fuelled, in particular, by the uncertainty caused by the US
"Section 201" safeguard investigation, and from March 2002, by the subsequent protectionist US
safeguard measures which imposed additional duties ranging from 8% to 30% ad valorem on variouscategories of steel products. Indeed, these severe American restrictions threatened to deflect large
quantities of such products away from the US and onto the Community market and thus to harm
Community producers.
The EU intends to maintain its surveillance mechan ism as long as the fundamental problems in the
international steel market remain unresolved. Howe ver, it is working actively to promote a solution to
these underlying problems, including through active participation in the OECD steel dialogue.
(vii) Safeguard measures
Questions from Japan:
With regard to the provisional safeguard measures imposed by the EU on certain steel products,Japan has expressed its concern, through consultations between the European Communities and
Japan under Article 12.4 of the Agreement on Safeguards via correspondence, on the possible spread
of safeguard measures for the reason of trade diversion, as well as on the consistency of the
provisional measures taken by the EU with the WTO agreements. Japan has also been seeking
clarification on the factual and legal issues used by the EU. An investigation on safeguard measuresis currently being undertaken. Japan would appreciate receiving an explanation on the current
situation of investigation and on the prospects of procedure, including the decision-making process
within the EU.
A: The investigation into the need for definitive safeguard measures in relation to the 21 steel
products under investigation commenced on 28 March 2002. For each of the products concerned,
questionnaires were sent to the Community producers, and to exporting producers, importers andusers who had made themselves known to the Commission following publication of the Notice of
Initiation. The level of cooperation enjoyed by the Commission has been extremely high, particularly
in the case of Community producers and exporting producers. Questionnaire responses were received
from 110 exporting producers.
Following receipt of the questionnaire responses, verification visits were carried out by teams ofinvestigators at the premises of a large number of Community producers. Verification visits were also
carried out at the premises of exporting producers in a number of countries including Japan, Korea,
China, Brazil, Turkey and Romania, and at the pr emises of importers. Discussions also took place
with the authorities of a number of countries in which exporting producers are located.
The Notice of Initiation of the proceeding advised interested parties that they were entitled to apply tobe heard by the Commission. A number of parties availed themselves of this opportunity and hearings
have been held in Brussels.
The Commission is currently in the process of collating and analysing the large amount of information
which it has received.
Procedure: In relation to the decision making process to be followed within the EU, there are two
options - Commission decision or Council decision (s ee Articles 16 and 17 of regn (EC) No 3285/94
and Articles 15 and 16 of regn (EC) No 519/94). No decision has yet been taken as to which
procedure will be adopted in this case.
Timing: As previously stated, the Commission aims to complete the current investigation by the end
of September 2002 or shortly thereafter.WT/TPR/M/102/Add.2
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Japan is concerned about the spread of protectionist measures and therefore requests that safeguard
measures not be taken by the EU. In all cases, should investigation and the safeguard measures betaken, these need to be consistent with the WTO.
A: The EC shares Japan's concern about the spread of protectionist measures. Japan will recall that
since the entry into force of the WTO Agreement on Safeguards, the EC had not made any use of the
safeguard instrument until the recent steel case. Nevertheless, the EC has considered that exceptionalcircumstances have occurred earlier this year as a consequence of the blatantly protectionist actions
taken by the United States on steel. This has justified the adoption of provisional safeguard measures
in full conformity with WTO rules and with releva nt jurisprudence. The EC will in the near future
take a decision on whether to confirm these provisional measures at definitive stage. Whatever
decision is taken, it will be fully consistent with the WTO.
Question from Taiwan:
We have noted that the EU initiated a safeguard investigation on 21 steel products on 27 March 2002,
and took provisional action on the same date on 15 steel products in response to the U.S. safeguard
action on imports of steel, effective on 20 March 2002. We would be very grateful if the EU couldshare its views with us on the following procedural suggestions:
Could the EU place the questionnaires and explanation form for fill-in in the related website so that
the exporters may have easy access to it?
 Would it be possible that exporters reach EU officials through internet, should the former have any
questions about those questionnaires?
A: Questionnaires were despatched to all exportin g producers who had made themselves known to the
Commission in connection with the safeguard proc eedings between 17 and 19 April 2002, and a reply
was requested by 10 May 2002. In some cases, extensions were requested to this deadline, and where
justified, a short extension was granted. On the basis of the responses received, verification visits
were carried out at a number of exporting producers between 27 may and 14 June. The questionnaires
were not available on the Commission’s website, but the Commission takes note of this suggestion forthe future.
Arrangements were, however, made so that interested parties could contact the Commission officials
dealing with the safeguard proceeding using the internet. The e-mail addresses of a number of the
officials concerned with the investigation were provided to exporting producers. (The address of the
Head of Section of the team dealing with the investigation is alain.gerzat@cec.eu.int ).
Questions from Argentina:
En el párrafo 37 del Informe de la Secretaría – WT/TPR/S/102 – se hace referencia a la adopción de
medidas de salvaguardia que alcanzó a diversos productos del acero. Surgen algunos los siguientes
interrogantes sobre los que se agradecerán clarificaciones:En tanto para fijar el contingente tarifario se adoptó un criterio – importaciones verificadas en el
periodo 1999/2000/2001 incrementadas en un 10% -- sólo se tomaron las importaciones del año 2001
para fijar los umbrales que activan la salvaguardia. ¿Podría explicar la UE porqué siguió este
criterio?
¿No considera la UE que habría sido más apropiado tomar el mismo periodo de referencia que el quese sigue para fijar el volúmen del contingente?
A: Argentina's question refers to two issues, the calculation of the level of quota and the calculation of
the 3% treshold for identifying those developing countries that can be exempted from safeguard
measures. The two issues are based on different articles of the WTO Agreement on Safeguards,
namely Article 5 as regards the type and level of the measures and Article 9 as regards development
country treatment.WT/TPR/M/102/Add.2
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Article 9 of the Agreement on Safeguards does not specify any criteria for calculating the 3%
treshold. The EU decided to take 2001 as the basis for the developing country exemptions in order toensure that data were as up to date as possible. This was considered more appropriate than following
the critera used to calculate quota level. When determining the latter, based on 1999 to 2001 import
levels plus 10%, the EU intended to respect traditional levels of imports whilst reflecting that these
imports were increasing.
Questions from Korea:
The Korean Government is concerned about the EU’s safeguard measures that have been taken in
reaction to the U.S. safeguard measures. China has also decided to follow suit by taking similar
measures. It is our concern that the spread of such import restrictive measures to other major steel
producing countries will, not only worsen the steel problem, but also negatively affect the ongoingDDA negotiations.
During the Korea-EU bilateral consultation on April 12, Korea raised the question as to whether
there existed critical circumstances warranting the provisional measures, whether there had recently
been sharp increases in steel imports, and whethe r there was clear evidence on the causation between
such increases and injury to domestic industry.Korea believes that unilateral import restrictions cannot resolve the current steel issue. Burden
sharing, not burden shifting, should be the solution to the global steel problem. In this regards, it is
necessary for the EU to set a good example by withdrawing the provisional measures as soon as
possible and refraining from taking import restrictive measures.
What is the view of the EU on this matter?
A: The EU steel industry is the primary victim of the increasingly protectionist stance adopted by the
US in relation to steel imports, culminating in the US steel safeguard measures announced on 5 March
2002. As a result of this, the EU was forced to adopt provisional steel safeguard measures. However,
unlike the US measures, those measures provide gene rous tariff quotas roughly equivalent to imports
in 2001, and it is only beyond these tariff quotas that any additional duties are payable.
The EU agrees that unilateral import restrictions cannot resolve the current steel issue. Indeed, theCommission has undertaken that the EU steel safeguard measures will remain in force not a day
longer than the US safeguard measures. Nevertheless, whilst the US safeguard measures remain in
force, the EU has little option but to take steps to ensure that the EU steel industry is not seriously
injured by further flood of steel imports arising as a result of trade diversion.
When the EU took the provisional safeguard measures, it applied the global quota, which put
geographically remote countries like Korea under unfavorable competitive conditions. Unless the
products subject to the Safeguard measures are not perishable in nature, it appears to be more
appropriate and reasonable to consider the historical reference rather than to only apply the first-
come/first-serve principle.
Does the EU have any plan to revise the current system?A: The EC is close to completing its safeguard investigation on certain steel products. The EC is
currently examining with all parties concerned whet her the current system (global quotas with first-
come/first-serve principle) should be revised in the context of its decision on whether to adopt
definitive safeguard measures.
Question from Costa Rica:
El párrafo 37 se refiere a las medidas adoptadas en virtud de la salvaguardia aplicada por Estados
Unidos a la importaciones de acero. Relacionado con lo anterior, se hace referencia a que el
aumento en el volumen del comercio por encima de un nivel establecido en el 2001 activará laWT/TPR/M/102/Add.2
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aplicación de ciertos derechos suplementarios y asimismo, se hace referencia a unos derechos
adicionales a los productos importados de los Estados Unidos ¿Corresponden éstas medidas a lasuspensión de conseciones u obligaciones sustancialmente equivalentes a las que se refiere el
Artículo 8, párrafo 2 del Acuerdo sobre Salvaguardia del GATT 1994? (párrafo 37)
A: Yes, the additional duties of between 8% and 100% on products imported from the United States
as referred to in parargaph 37 (second sentence), correspond to suspension of substantially equivalentconcessions or other obligations as referred to in Article 8.2 of the WTO Agreement on Safeguards:
Question from Uruguay:
En el párrafo 28, se indica que, "la UE continua haciendo frecuente use del mecanismo de
salvaguardia especial de conformidad con el Acuerdo sobre Agricultura de la OMC para importararanceles adicionales".
Según el Acuerdo sobre Agricultura (art. 5 párrafo 9) ya habría expirado el plazo para su utilización,
lo que haría incompatible con la OMC el mecanismo aplicado hasta el presente; en tal sentido que
medidas piensa adoptar la UE para cumplir con esta disposición.
A: SSG is used in a very limited way and it is always in application.
Question from Brazil:
The Commission initiated a safeguard investigation on 21 steel products on 27 March 2002, and took
provisional action on the same date on 15 steel products in response to the US safeguard action on
imports of steel (p.37). Two categories of steel products exported by Brazil are subject to the EU’squotas: “tin mill products” (category 9) and “alloy merchant bars and light sections” (category 13).
However, the market share of Brazilian exports in the amount of EU’s imports has declined for the
two categories in the last years. The EC confirmed that in case of adoption of definitive measures,
“…the Commission will give careful consideration to Brazil’s request”. Is there any decision
regarding the adoption of definitive measures?
A: There is no decision on the adoption of definitive safeguard measures yet. As soon as one will be
made, Brazil will be informed and consulted as according to relevant EU and WTO rules.
Question from Chile:
Las Comunidades Europeas, desde la entrada en vigencia de los Acuerdos de la OMC, no habían
aplicado ninguna medida de salvaguardia hasta inicios de este año, en que se ha notificado a la
OMC el inicio de investigación y la adopción de medidas de salvaguardia provisional a determinados
productos de acero. ¿Ello implica un cambio en la política comercial comunitaria respecto delempleo de instrumentos de defensa comercial?
A: Chile rightly recalled that since the entry into force of the WTO Agreement on Safeguards, the EC
had not made any use of the safeguard instrument until the recent steel case. Indeed, the EC has
repeatedly expressed its position on this matter, in particular in the context of several WTO disputesettlement procedures, that recourse to this instrument must be truly exceptional in nature and limited
to emergency situations. The EC would recall that the Appellate Body has fully endorsed this
position. The EC considers that such an emergency situation has indeed occurred as a consequence of
the blatantly protectionist actions taken by the United States earlier this year. Therefore, its decision to
impose provisional safeguard measures is perfectly coherent and does certainly not imply any change
in its commercial policy as regards the use of trade defence instruments.WT/TPR/M/102/Add.2
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(viii) Product regulations and standards
(a) Overview
Questions from Switzerland:
To paragraph 41: In early 2002, the EC Commissi on launched an online consultation about the New
Approach concept. Switzerland would be very much interested in information about the current status
of the evaluation procedure in this context. Furt hermore, Switzerland would like to know when and
where the conclusions and results of the consultation will be published.
A: The Commission services are in the process of  producing a Communication to the Council and the
European Parliament concerning the New Appro ach. The Communication is not yet finalised, but is
expected to be adopted soon. It will concentrate on a small number of issues, namely, the designation
and notification procedure for notified bodies, the CE conformity marking and market surveillance.
To paragraph 41: Some product sectors are still ruled by Old Approach Directives. Are there any
plans to transform existing old Approach Direct ives into Directives based on the New Approach
concept or to apply this concept outside the field of product related legislation?
A: There is no systematic plan to convert all old approach sectors to the new approach. Instead,
legislative changes are considered on a case-by-case basis. Therefore as existing sectoral legislation is
assessed, application of the new approach would certainly be considered, and could be proposed if
considered appropriate.
To paragraph 41: In the frame of the New and Global Approach, Directives should contain only the
so called "essential requirements" concerning the safety of a product. These basic requirements are
then specified in harmonised standards that are appl icable in the field of a particular Directive. If a
product is manufactured based on these standards, this will lead to a presumption of conformity with
the basic requirements defined in the relevant Directive(s). This concept makes it obsolete that the
Directive itself must contain detailed technical requirements which often do not reflect existing
technical know-how in a specific sector. Switzerland would like to know, why certain Directives that
are developed according to the New Approach still contain detailed technical requirements instead of
basic requirements together with references to harmonised standards. This is e.g. the case for the new
Measuring Instruments Directive where the present Draft still contains far too detailed technical
requirements that should be replaced by a refere nce to harmonised standards. Switzerland is of the
opinion that the adoption of new Directives as we ll as the revision of existing ones should be
comprehensively and coherently based on the criteria defined in the New Approach concept.
A: The EU endeavours to apply the principles of the new and global approaches in a consistent
manner, however there are sector specific issues that necessitate these principles being applied in a
way that meets the specifics of the sector. In th e case of the Measuring Instruments Directive, the
metrological requirements that measuring instruments sh all satisfy are still restricted to essentials for
the control of tasks that are legally required. Even though some of these requirements are laid down in
the directive, they do not pre-empt technical solutions or impede technological progress by being too
specific. It should also be noted that the Commission's proposal is still under discussion in the Council
and European Parliament, so the text of the directive could undergo change.
In paragraph 43 the EU highlights major developm ents in the area of food law, including the
establishment of the European Food Safety Authorit y (EFSA), whose most important role will be the
scientific input for the EU decision making process. Is there a legal framework providing for third
country participation within EFSA or for access to scientific data?WT/TPR/M/102/Add.2
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A: The scientific data collected by the EFSA and the opinions of its scientific committee and panels
will be made available on the web. The EFSA will work in an open and transparent manner and will
make available to all any information on risks in the food chain, emerging risks and the results of
studies it undertakes.
The founding Regulation also provides for the EFSA to collaborate with third countries on scientific
information gathering and data collection and it is probable that once the EFSA becomes operationalit will develop close relationships with third coun tries in this respect. The EFSA will also form
specific relationships with countries with whom it has signed special agreements and whom apply the
same standards of food law, notably the EEA and EFTA countries. In addition and when requested to
do so by the Commission, the EFSA will provide scie ntific and technical assistance, with a view to
improve cooperation between the Community, applicant countries, international organisations andthird countries in the field within its mission- Article 23(i)
Questions from Canada:
Paragraph 40 mentions that in order for a product to be placed on the market of a Member State, it
must comply with the relevant regulations, where they exist, to meet health, safety, and environmentalobjectives, established by means of conformity assessment procedures; in all other cases, a general
product safety requirement applies. Given the comp lexity of the EU system, Canadian exporters and
authorities would welcome assistance locating relevant standards and regulations that apply to
specific products. Please indicate if the EU Enquiry Po int (established to fulfil the requirements of the
WTO TBT/SPS Agreement) is able to provide such information. Please also indicate if the EU can
provide direction to manufacturers to enable them to access information on requirements of
individual member states.
A: EC TBT Enquiry Point may provide such informa tion. It suggests that the request of information is
precise enough to facilitate the necessary research for identification of the information. Information
on requirements of Member States for access to their market (mainly in non-harmonised areas) can be
obtained through the National TBT Enquiry Points.For the products coming under the New Approach this information can be accessed on
www.newapproach.org.
Paragraph 40 states that such regulations are d eveloped at Community level ("harmonized" areas)
for EU-wide application, or at national level ("non-harmonized" areas); as was noted at the time ofthe previous Review, exporters benefit from Community harmonization efforts, in principle, as one set
of regulations replaces 15 potentially different sets. Non-harmonized products account for about 21%
of the total. Please indicate what products fa ll in the 21% of non-harmonized products and why they
are not harmonized.
A: Product regulations are under continuous review, and the opportunity will be taken, whenever
feasible, to develop regulations in the harmonised areas and reduce the non-harmonised regulations.
There are no formal plans for this however.
Harmonisation is necessary when the level of protection is so different among Member States that
other means such as the introduction of a mutual r ecognition clause are difficult to apply. According
to the principle of mutual recognition as interpreted by the European Court of Justice, in any sectors
which have not been subject to harmonisation measures at Community level or which are covered by
minimal or optional harmonisation measures, every Memb er State is obliged to accept on its territory
products which are legally produced and marketed in another Community Member State. Member
States may only challenge the application of the principle in cases where, in particular, public safety,
health or the protection of the environment are at stake; in these cases, furthermore, any measures
taken must be compatible with the principles of necessity and proportionality.WT/TPR/M/102/Add.2
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Mutual recognition plays a significant role in ensuring the proper functioning of the Internal Market
as well as in the context of the World Trade Organisation and the new round of international tradenegotiations as acknowledged by Council Resolution of 28 October 1999 (2000/C 141/02)
Paragraph 41 states that product regulations at Community level are of two main types: “old
approach” product-specific regulation lays down de tailed and specific technical requirements, and
applies in particular to motor vehicles, chemicals, food products, and pharmaceutical products;“new-approach” regulations, which apply to a large number of areas, limit mandatory obligations to
essential requirements, defined to meet health, safety, and environmental objectives, while leaving
specific technical solutions to meet these requirements to the market, either through voluntary
standards or a manufacturer's own solution. Please indicate the steps being taken to streamline this
process for the delivery of standards in the EU. Please explain if this consensual process change orbe altered in order to adapt to an enlarged EU.
A: The way the EU does product regulations is subject to the better regulation package adopted by the
Commission, which is responsible for drawing up le gislative proposals for the EU. With a view to
enlargement the recently established convention l ooks into law-making procedures in the EU and
possibilities on how to alter them. Other than the legislative process there is no need to alter the
voluntary standardisation system in an enlarged EU. The European standards bodies are already now
operating on the basis of more national partner institutes than present EU member states.
Paragraph 41 mentions that the manufacturer must affix the "CE" mark to the product to indicate
compliance with essential requirements, which has been established by the prescribed conformity
assessment procedures, including, among others, the manufacturer’s declaration of conformity,
without which the product may not be placed on the EU market. Please elaborate on the steps that
must be taken for a manufacturer to obtain the ability to use the CE mark.
A: The steps a manufacturer must take to affix the CE mark to a product depends upon the sector. To
understand the principles involved please consult website:http://europa.eu.int/comm/enterprise/new approach/legislation/guide/legislation.htm
Paragraph 42 and footnote 80 mentions that in no n-harmonized areas, Member States may legislate
but are required to notify the Commission of draft national measures to prevent unjustified
restrictions to trade. Please document the extent to which Member States notify the Commission.Please enumerate the measures of control to ensure notifications take place. Please share the
consequences of non-notification. Please indicate if national measures which are notified to the
Commission, are systematically and simultaneously no tified to the WTO Secretariat. If not, please
explain why.
A: Regarding notifications of Member States within the European Community, please note that
member States have stricter obligations on the basis of Directive 98/34/EC which provides that they
have to notify to the Commission any draft tech nical regulation on products or Information Society
services. Information on this procedure, the number of notifications etc. can be obtained at the
following address: http://europa.eu.int/comm/enterprise/trisIt has to be noted that within this system the only conditions that has to be met for a notification to be
made by a Member State is that "it is a technical regulation" with a definition broader that this of the
TBT Agreement. The other two conditions of the TBT Agreement i.e. a) notification is required when
there are no international standards concerning the matter covered by the proposed measure or when
the measure deviates from such an international standard, and b) the measure needs to have an
considerable impact on trade, do not need to be met for a notification to the Commission.
Furthermore, a measure not notified by a Member State to the Commission, according to theWT/TPR/M/102/Add.2
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jurisprudence of the European Court of Justice is not opposable to third parties by National Courts.
Particular measures of control of measures not notified are not in place but Member States take careof ensuring such notifications.
Measures notified to the Commission are not systematically notified to the WTO Secretariat, since the
conditions to be met for a notification are different as just explained.
Paragraph 42 notes that Member States are required to grant mutual recognition to products lawfully
produced and marketed in another Member State, subject to protection of overriding public interests.
Footnote 81 mentions that Article 30 of the EC Treaty provides for justified prohibitions or
restrictions of imports, exports, or goods in transit on the grounds of the protection of health and life
of humans, animals or plants provided that such prohibitions or restrictions do not constitute a means
of arbitrary discrimination or a disguised restriction on trade. Please provide a list, accompanied bya succinct analysis, of all Article 30 cases that were brought before the European Court of Justice.
A: As for the question on the jurisprudence of the European Court of Justice on Article 30 cases,
please note that no such list of all Article 30 cases accompanied by a succinct analysis, as required, is
immediately available to us nor can it be retrieved and prepared in such a very short time. Relevantcases are, however, directly accessible through the Europa server. Moreover, further information, with
the most recent important cases, is available in the "Practical guide to the concepts and application of
Articles 28 to 30 of the EC Treaty" available in:
http://europa.eu.int/comm/internal_market/en/goods/art2830.htm
Paragraph 42 states that the upper bound of trade gains from perfect application of mutual
recognition is estimated at 1.8% of the EU GDP of E85000 billion in 2000. This is significant. Please
indicate the measures that are in place to reduce this percentage. If no measures are in place, please
indicate what are the measures presently being considered.
A: As for the question regarding measures that are either in place or being considered to improve the
application of mutual recognition clause, the issue is dealt with in biennial reports from theCommission to the Council, the European Parliament and the Economic and Social Committee. Please
note that the second such report for 2002 is to be published shortly.
The general pattern has been that problems in the ap plication of the mutual recognition clause seem to
appear basically in the fields of more complex or sensitive products. The Commission tries to
facilitate the application of the clause by co-operating with national authorities (holding seminars etc)as well as by issuing practical guides and communications dealing with specific sectors. Moreover if
such measures fail or do not apply the Commission may initiate infringement proceedings against a
member state.
Paragraph 44 mentions that the EU or a Member State is to publish draft and final legislation, notify
the WTO of draft regulations that may "have a significant effect on trade of other Members", and
generally provide a 60-day period for comments. With reference to Table III.4, please explain the
downward trend of EU notifications since 1999. Please explain why the notification numbers of
Belgium and the Netherlands are at a much higher level compared to other EU Members.
A: The number of EU notifications each year is linked to the number of measures (which meet the
conditions necessary for a measure to be notified under the TBT Agreement) proposed within the
same year at EU level.
Member States of the EU notify directly to the WTO Organisation.
Paragraph 44 states that the EU or a Member State is to publish draft and final legislation, notify the
WTO of draft regulations that may have a significant effect on trade of other Members, and generallyWT/TPR/M/102/Add.2
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provide a 60-day period for comments; in 2000 and 2001, the EU and its Memb er States notified the
WTO of 148 and 110 measures under the TBT Agreement, respectively (Table III.4); additionalmeasures were notified to the SPS Committee. Please explain the process within the EU for
circulating subsequent drafts of legislati on once amendments have been proposed (i.e., by
Parliament). Please indicate the current timeframe for providing comments on such proposed
amendments, if any.
A: The circulation of draft legislation (once amendments have been introduced) and the timeframe for
comments on those depends of the procedure followed for the adoption of each particular measure.
Regarding comments from third countries on measures notified by the EC, it has to be noted that these
comments are taken into consideration by the different actors of the legislative procedure. They do
continue to be valid independently of a subsequent amendment of the notified measure with the EU.
Paragraph 44 states that EU TBT-related Enquir y Points have been established for harmonized
areas. Since individual Member States have also es tablished Enquiry Points, please indicate if these
are accessible by foreign manufacturers. Please elaborate on the services they provide. Please share
if the EU is considering establishing Enquiry Points for non-harmonized areas.
A: Full details on the accessibility of all TBT Enquiry Points can be found in WTO document
W/TBT/ENQ/20. This includes not only the European Community Enquiry Point, but also Enquiry
Points in all of the fifteen member states of the European Community.
Paragraph 44 mentions that the European standard-setting organizations and their national
committees have each accepted the TBT Code of Good Practice for the Preparation, Adoption andApplication of Standards. Please indicate which internal mechanisms exist within the Commission or
elsewhere to monitor the application of the TBT Code.
A: The TBT Code of Good Practice for the Preparation, Adoption and Application of Standards does
not foresee such a mechanism. If Canada interprets the TBT Code in such a way this should be raisedwith all members.
Canada has recently undergone a review of its re gulatory practices by the OECD and formally
proposed that the EU consider a similar review of its regulatory practices. Please share the
Commission’s response to this proposal.
A: A review of the operation of the "New Approach" to technical harmonization and standardization
is under way.
Questions from New Zealand:
New Zealand shares the EC's view that products pl aced on the market of a Member State must comply
with relevant health, safety, environmental, and consumer protection regulations (Secretariat report,
page 37, para 39). It is important, however, that regulations are not more trade restrictive than
necessary to fulfill these stated objectives, and do not create unnecessary barriers to international
trade. Indeed we have WTO obligations to that ef fect. New Zealand has substantive concerns over EC
Regulation 753/2002 on wine labelling in this regar d, which we have raised (along with several other
Members) in both the TBT Committee and the TRIPs Council. Can the EC indicate whether it is
prepared to re-examine Regulation 753/2002 in light of these concerns?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying commentsWT/TPR/M/102/Add.2
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received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
We note in the Secretariat report (page 39, para 44) that EC regulations are subject to the obligations
imposed under the TBT and SPS Agreements, and that  the EC is to "notify the WTO of draft
regulations that 'may have a significant effect on trade of other Members', and generally provide a
60-day period for comments." This process does not s eem to have been followed with EC Regulation
753/2002, which was not notified to WTO Members until after the final regulation had been
published. Article 2.9.2 of the TBT Agreement requires Members to notify regulations at an
appropriately early stage so as to allow other members to comment, and to provide an opportunity for
amendments to be made on the basis of those comments.  In light of this, is the EC prepared to defer
entry into force of the Regulation until comments are taken into account and the necessaryamendments made?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying commentsreceived from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
We welcome the EC’s focus on scientific evidence underpinning food safety policy, as required by the
WTO Agreement on the application of sanitary and phytosanitary measures (SPS agreement). We are
concerned, however, at potential confusion betw een food safety and consumer information issues
(Secretariat report, para 30). Can the EC explain the objective of proposed product tracing(traceability) requirements for many foods, feed stuffs and food-producing animals, and how it will
ensure that measures to ensure full product tracing will be no more trade restrictive than necessary to
meet this objective? How does the EC propose to en sure consumer information objectives for product
tracing remain clear and separate from measures to  ensure that food is safe for human consumption?
What criteria will be used to distinguish clearly between cases where mandatory product tracing isrequired and those where the use of product tracing systems should be market-driven?
A: The general traceability requirements in Regulation (EC) 178/2002 provides that food and feed
business operators have to have systems in place to identify from whom they have received a food or
a feed (one step back) and to whom they have sold a food or a feed (one step forward).The traceabilityrequirements include food, feed, food-producing animals, and any other substance intended to be, or
expected to be, incorporated into a food or feed, at all stages of production, processsing and
distribution. The objective is to establish a comprehensive system of traceability within food and feed
businesses so that targeted and accurate withdrawals can be undertaken or information given to
consumers or control officials. The European Commission considers that any given piece ofinformation can serve a number of purposes and objectives. When legislation includes multiple
objectives, there are almost always intertwined and there is therefore no need to distinguish between
clauses which primary serve one purpose and others which primary serve another purpose. Nor is
there, in the view of the European Commission any obligation under international treaties to operate
on the basis of such distinctions.Operators are allowed and welcome on a voluntary basis to establish traceability requirements which
go beyond European Community law.
The European Commission considers that these traceab ility requirements are not trade restrictive, but
correspond in fact to the in formation which is already transmitted between operators and traders in
the production and distribution chain.WT/TPR/M/102/Add.2
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Question from Japan:
There does not appear to exist any unified arrangements throughout the EU as a whole to investigate
and prosecute products, including machine tools, which do not carry “CE” mark when placed on the
EU market. Currently, such investigation and pros ecution of products are left to individual Member
States. Japan has been requesting through the Ja pan-EU Regulatory Reform  Dialogue that the
European Commission formulate a law (regulation or directive) to unify measures of investigation
and prosecution in the case of violations against th e “CE” marking-related legislation within the EU.
This would thus give more consideration to th e efforts made by companies from Japan and other
countries which abide diligently by the CE marking system. Please provide EU’s perspective for
establishing such unified arrangement.
A: Market surveillance and other enforcement measures are the responsibility of the Member States.
The Commission has, however, initiated a dialogue with Member States with the aim of achieving a
common level of market surveillance throughout the Union. This issue is one that will be addressed in
the Communication that is planned on the review of the new and global approaches. This
Communication should be adopted shortly.
Question from Taiwan:
Pursuant to paragraph 42 in the EU Report, member states of EU may adopt their national SPS
measures, but are required to notify the Commission. The EU or any member state is to publish draft
and final legislation, notify the WTO of draft regulations that may "have a significant effect on trade
of other Members". Please give detailed explanation on measures in Table III.4.
A: The question is not clear at all. In case, the question aims to know what is the EC and Member
States notification procedures to the TBT agreement, the answer is the following:
- Member States of the EC are responsible for the notification of their own legislation.
- The European Commission is in charge of notifying EC legislation.
- The table, mentioned in the question, shows notifications from the EC and its member States
under the TBT agreement.
- In case, the question aims to know the SPS notification system of the European Community,
the answer is the following:
- The European Commission is in charge of noti fying its own draft EC legislation and Member
States draft legislation.
Questions from Hong Kong, China:
Since the last Review in mid-2000, the EU and its Member States have put in place new regulations
for certain products. Note that certain WTO Me mbers perceive these new product regulations as
significant trade barriers. Where there are no internationally agreed standards, how does the EU
ensure that any measures introduced for health, safety and environment objectives would not be moretrade restrictive than necessary?
A: If the EU decides to introduce product regulations, whenever deemed necessary for the protection
of legitimate objectives, and in the absence of inte rnational standards, it is commonly prompted to an
approach that is least trade restrictive as possible. The reason for this is twofold. Any new measureswill also have an impact on trade within the EU a nd all interested stakeholders (manufacturers, etc.)
will influence the decision making process to avoid unnecessary trade restrictions. Trade with third
countries is likewise concerned. A nd the EU parties engaged in trade with third countries and also
comments from third countries will argue against measures that are more trade restrictive than
necessary.WT/TPR/M/102/Add.2
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Note that product regulations are developed at Community level (“harmonised” areas) or national
level (“non-harmonised areas”) and that non-harmo nised products account for about 21% of the
total. Given that exporters generally benefit from Community harmonisation efforts, does the EU has
plans to reduce the number of non-harmonised regulations, and if so, what are the details?
A: Product regulations are under continuous review, and the opportunity will be taken, whenever
feasible, to develop regulations in the harmonised area and reduce the non-harmonised regulations.There are no formal plans for this however.
Harmonisation is necessary when the level of protection is so different among Member States that
other means such as the introduction of a mutual r ecognition clause are difficult to apply. According
to the principle of mutual recognition as interpreted by the European Court of Justice, in any sectors
which have not been subject to harmonisation measures at Community level or which are covered byminimal or optional harmonisation measures, every Memb er State is obliged to accept on its territory
products which are legally produced and marketed in another Community Member State. Member
States may only challenge the application of the principle in cases where, in particular, public safety,
health or the protection of the environment are at stake; in these cases, furthermore, any measures
taken must be compatible with the principles of necessity and proportionality.Mutual recognition plays a significant role in ensuring the proper functioning of the Internal Market
as well as in the context of the World Trade Organisation and the new round of international trade
negotiations as acknowledged by Council Resolution of 28 October 1999 (2000/C 141/02).
Questions from Australia:
Will the EU undertake equivalence determinations for countries other than those seeking accession or
current member states?
A: Member states and applicant countries shall comply with the EC legi slation. For exporting
countries, this legislation lays down that sanitary conditions for imports are at least equivalent to the
conditions prevailing in EC member States. The competent authorities of exporting countries have to
be assessed by the European Commission Food and Veterinary Office. This assessment is based onthe guidelines issued by the Codex Alimentarius Commission for the determination of equivalence of
the systems of inspection and certification. The EU supported the Codex draft determination of
equivalence of sanitary measures which is still in discussion.
In terms of consistency of measures, why does the EU provide for regionalisation determinations for
diseases present in member states and not for third countries?
How does the denial of similar determinations fo r third countries meet EU and WTO requirements for
being least trade restrictive?
Why does the EU take more than ten years to consid er equivalence determinations without providing
a substantive response during this period?Will the EU improve its equivalence determination process under the new regulations?
Will the new regulations be less proscriptive than the older regulations?
Will they be outcome based?
A: These questions raised by Australia are ba sed on wrong assumptions. The European Community
applies the regionalization principle in a very consistent manner within its own territory and versus
third countries, based on scientific evidence and the equivalence principle, as established in the SPS
agreement. This has been clearly shown to Australian officials during a bi-lateral technical meeting
held in Brussels in October 2002.
Indeed, the EC applies a regionalization policy regarding several animal diseases towards a very high
number of third countries in the world including many developing countries in Africa, Asia and
America, making possible exports from these countries.WT/TPR/M/102/Add.2
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However, the EC does not apply this concept if the disease control measures enforced and the health
guarantees offered by a third country wishing to export to the EC are not sufficient to adequatelyprotect the Community.
Will the new regulations recognise that many countries have been successfully applying HACCP
systems for many years?
A: The EU supported the development of HACCP principles in the food production from the
beginning of the nineties, in particular in the C odex Alimentarius Code of  Practice for Food Hygiene.
However the Codex is still discussing the implementation of HACCP in small and medium
enterprises. Recognising the importance of these systems, the EC welcome and recommend their
world-wide application. When assessing the Competent Authorities of exporting countries, the ECtales into account the implementation of HACCP systems by the food industry
“Environment”:
Please explain why the EU is pushing to introduce language on precaution in multilateral
environment agreements and other international agreem ents and standards that is different from Rio
Principle 15 and SPS Agreement Article 5.7?
A: All references to precaution which have been inserted in MEAs recently adopted by the
International Community are fully consistent with Rio Principle 15. As gerenally recognised, the
concrete implementation of the precautionary principle is to be done on a case-by-case basis. The
language might have therefore been refined in order to adapt to the specific situation addressed and
to the environmental problem to be tackled.
In reference to paragraph 48 of the Secretariat’s Report, does the EU determine whether the use ofthe precautionary principle is appropriate under existing and planned environment regulations as
well as in the food area? If so, please provide examples of how the precautionary principle is
operationalised based on these determinations.
A: In the Community’s view, the precautionary principle is an internationally recognised principle of
international law, which is also embodied in the jurisprudence of the WTO’s Disputes Settlement
Body. This principle is also listed in the EC Treaty as one of the guiding principles of Community
Environmental Policy.
On 2 February 2000, the Commission adopted a Communication on the use of the precautionary
principle. In this Communication the Commission identified the situations in which measurespursuant to the precautionary principle should be taken. These situations are when scientific evidence
is insufficient, inconclusive or uncertain and preliminary scientific evaluation indicates that there are
reasonable grounds of concerns with regard to environment, human, animal or plant health.
What consultation processes does the EU undertake, prior to WTO notification, to ensure that the
implementation of environm ental standards, such as product safety and disposal regulations, has the
least trade distorting effects? In particular, how does the EU ensure that systems developed by
member states, such as eco-labelling, involve external consultation, are WTO consistent and do not
unnecessarily impede trade in the products and/or services that are regulated? If consultation occurs
at the EU and member state level, does it involve all potentially affected exporting countries?
A: The EU legislative process is generally based on a wide consultation of interested stakeholders.
When deemed necessary, the Commission before puttin g forward a legislative proposal also consults
non-EU countries and foreign companies.
In the case of the European eco-label, external consultation is ensured when criteria for eco-labelled
products are developed by inviting external organisations (such as industry, trade, SMEs and
consumer organisations) to submit their comments, and, if they wish, attend working group meetingsWT/TPR/M/102/Add.2
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to discuss the development of new or adapted criteria and give their opinions on these criteria before
they are formally voted as Commission Decisions.  Contributions from non-EU and EEA countries are
welcomed, and, in addition, many trade and industry associations having membership, which extends
beyond the EEA, may come to the meetings. For each meeting minutes are produced and all minutes
as well as any comments received on revised criteria are published on the eco-label web pages:
www.europa.eu.int/comm/environment/ecolabel/ . There is no impediment to companies outside the
EU or the EEA applying for the European eco-label and several have successfully done so. Thus, all
potentially affected exporting countries can, if they wi sh so, be involved in the development of criteria
for eco-labelled products.
How does the EU classify environmental goods and services for the purposes of trade? Do goods
“produced in an environmentally friendly mann er” fall within these classification systems?
A: As regards environmental services, the EC has submitted a proposal for a revision of
environmental services in the context of the GATS negotiations. While discussions on classification
in this sector are still ongoing, we are also pursuing our classification proposal in the context of the
bilateral negotiations with our partners, without prejudice to the outcome of the discussion on theclassification of environmental services. However, the EC is open to suggestions for paying particular
attention to goods whose sustainable materials or pr oduction characteristics mean that increased trade
in such products would also be environmentally supportive.
“Wine labelling”EU Regulation 753/2002 indicates a policy of claiming that certain common terms are ‘traditional
expressions' and thereby warrant reservation for the exclusive use of certain European winemakers.
Traditional expressions are not, however, a form of intellectual property recognised in the TRIPS
Agreement, or any other WTO agreement. How do th e EU claims that their winemakers should be
able to prevent others from using these words conform with WTO obligations with respect to national
treatment and to have in place regulations that are not more trade restrictive than necessary to fulfil
the legitimate objectives of health, safety, environmental and consumer protection legislation and that
do not create unnecessary barriers to trade?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
As the EU is aware, Australia, along with a number of other Members, has significant concerns with
proposed EU Regulation 753/2002. These concerns relate to both matters of substance, concerning
the consistency of the Regulation with the TBT and TRIPS Agreements, and to the procedure by which
the EU notified the draft Regulation to the TBT Committee. The TBT Agreement requires Members to
notify draft regulations that may have "a significant effect on trade of other Members" and provide a
60 day period for comment. Regulation 753/2002 will have such a significant impact on the trade ofother Members. The EU appears, however, only to have notified that Regulation once the final
version was published. In this way the EU has deprived Members of the opportunity to have their
comments taken into account as amendments to the draft Regulation. Australia regards this a
significant deviation from the EU's obligations under the TBT Agreement. Can the EU advise how it
intends to address this situation?WT/TPR/M/102/Add.2
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A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
Will the EU defer entry into force of the Regulatio n until such time as Members have been given the
opportunity to comment on the Regulation and an y necessary amendments are made to the
Regulation?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
Question from Korea:
As explained in the Secretariat Report, the EU has adopted many regulations for the purposes of
health, safety and the environment. Although the necessity of those regulations is understandable, it
should be noted that many regulations are still duplicative, causing unnecessary burdens on
importers. Furthermore, during the process of se tting the regulations, non-EU companies were given
very limited opportunities to voice their opinions.
Does the EU have any plan to simplify the regulations and ensure that every interested company is
given an opportunity to convey their proper concern on the regulations?
A: The EC is continuously doing efforts to simp lify the legislation, where appropriate. Each new
regulation/standard is notified to the WTO in accordance with the SPS and TBT agreements.
Comments made in the framework of this notification are carefully considered and if appropriate
included into the regulation/standard. It is not possible to inform each individual company worldwideof proposed new regulations/standards.
Question from Costa Rica:
¿Cuáles productos tienen reglamentos técnicos basados en la protección del medio ambiente?; ¿Qué
porcentaje de esos reglamentos se encuentran armonizados y qué porcentaje ha sido establecidomediante legislación de cada Estado? ¿Cuáles de esos reglamentos se refieren a los métodos y
procesos de producción? (párrafos 39 y 40).
A: The texts of EU environmental legislation in force are available at the following website:
http://www.europa.eu.int/comm/environment/legis_en.htm . As already explained in paragraph 40 of
the Secretariat Report, non-harmonised products account for about 21% of the total. As far as Process
and Product related Methods are concerned (PPM), the Community legislation is seldom based on this
methods.
Questions from Mexico:
En los párrafos 39 a 44 del capítulo III del IS se describe parcialmente la forma y los supuestos en
que se establecen reglamentos técnicos por parte de la Comunidad, o bien de los Estados miembros.
Al respecto, (i) ¿Puede la UE indicar si existen programas anuales o periódicos en los que se enlisten
los temas que serán objeto de reglamentación por parte de la UE o de sus Estados miembros y en
dónde se publican? (ii) ¿En caso de no existir estos programas, puede la UE indicar cuándo
piensa(n) adoptarlos, o bien, las razones que le(s) impiden hacerlo? (iii) ¿Puede la UE indicar si el
desarrollo de un reglamento técnico implica la elaboración de un análisis de impacto regulatorio,WT/TPR/M/102/Add.2
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como requisito previo y, en caso de ser así, si el mismo puede ser consultado por nacionales de los
Miembros de la OMC? (iv) ¿Puede la UE indicar si existe alguna disposición legal que la obligue aella, o bien a sus Estados miembros, a revisar periódicamente el contenido de sus reglamentos o
normas técnicas? (v) ¿En caso de no existir, puede la UE indicar cuándo piensa(n) adoptar una
disposición, o bien, las razones que le(s) impiden hacerlo? (vi) ¿Puede la UE confirmar si los
nacionales de Miembros de la OMC pueden participar en la elaboración, modificación o cancelación
de reglamentos técnicos, tanto a nivel nacional como europeo y describir el procedimiento a seguirpara obtener ese derecho, o bien, en caso de que la respuesta sea negativa, justificar las razones por
las que no se permite tal participación?
A: (i) Details concerning planned legislation can be found in the annexes to the Commission Work
Programme (please refer to web site:http://europa.eu.int/comm/off/work_programme/index_en.htm )
(ii) Not applicable
(iii) Yes. The Commission adopted a "better regulation" package in June 2002. For further
information, please refer to web site:
http://europa.eu.int/comm/governance/whatsnew.htm
(iv) No legal requirement, however legislation is under continuous review using a variety of
measures.
(v) The advantages of using a legal instrument would first need to be demonstrated.
(vi) All members of the WTO have the right to comment on proposed legislation in accordance with
the provisions of the WTO/TBT Agreement
Debido a que no existe un inventario exhaustivo de normas y reglamentos técnicos a nivel de fracción
arancelaria.¿Puede la UE indicar que acciones está llevando a cabo para atender problemas de
transparencia que enfrentan los exportadores de terceros países al mercado Europeo, al tratar de
identificar las normas que aplican a sus productos?
A: We are not aware of any specific problems concerning the transparency of standards and
regulations. Applicable European product regulations  are all published in the Official Journal of the
European Communities (L series). European standards are similarly published by the three European
Standardisation Bodies i.e.  CEN, CENELEC and ETSI.
Puede la UE indicar qué porcentaje del total de fracciones arancelarias incluidas en el sistema
armonizado se encuentran reguladas a través de normas o reglamentos técnicos?
A: This information is not available.
El IS es omiso en cuanto a las disposiciones que rigen la elaboración, modificación o cancelación de
reglamentos y normas técnicas por parte de las autoridades estatales, municipales o provinciales de
los Estados miembros de la UE. ¿Puede la UE de scribir qué ordenamiento(s) legal(es) describen tal
procedimiento, qué principios deben observar tales jurisdicciones (vgr. Consulta pública, consenso,
etc.) y, en su caso, describir brevemente tal procedimiento?
A: This question is extremely broad in nature and is best answered by examining the decision making
processes in the European Union and the legislative procedures in force. For this task please refer to
the following internet address: http://europa.eu.int/institutions/decision-making/index_en.htm.
En el párrafo 40 del capítulo III del IS se señala que el cumplimiento de los requisitos establecidos en
las normas se describe en procedimientos de evaluación de la conformidad. (i) ¿Puede indicar la UEsi tales procedimientos son generales o si se establecen en relación con cada reglamentación? (ii)WT/TPR/M/102/Add.2
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¿Puede la UE indicar cuántos procedimientos de evaluación de la conformidad están vigentes en su
territorio, cuántos productos abarcan y en qué ordenamiento (s) legales están establecidos? (iii)¿Puede la UE señalar si tales procedimientos se someten a consulta pública?
A: (i) For new approach directives, conformity assessment is subdivided into modules, which
comprise a limited number of different procedures applicable to a wide range of products. The
modules relate to both the design phase of products, their production phase or both. There are eightbasic modules, with a small number of variants. The modules may be combined with each other in a
variety of ways in order to establish complete conformity assessment procedures for the specific
sector in question.
(ii) In order to find more information on how the modules are used in practice, please refer to the
Guide to the New and Global Approach on the following web-site address:http://europa.eu.int/comm/enterprise/new approach/legislation/guide/legislation.htm
The guide shows the applicable modules for each new approach directive.
(iii) The basic modules have been applied since the adoption of the Global approach, which dates
back ten years. At that time consultation with stakeholders took place.
En el párrafo 41 del capítulo III del IS, se distingue entre reglamentos de "antiguo enfoque" y "nuevo
enfoque". ¿Puede la UE indicar de qué depende que un reglamento técnico se adopte con uno u otro
enfoque?
A: As the names imply, the new approach has been introduced more recently than the old approach,
and is used whenever feasible for new technical regulations. It should also be noted that there is no
systematic plan to convert all old approach sectors to the new approach. Instead, legislative changesare considered on a case-by-case basis. Therefore as existing sectoral legislation is assessed,
application of the new approach would certainly be considered, and could be proposed if considered
appropriate.
En relación con las normas de “nuevo enfoque”, el pá rrafo 41 del capítulo III del IS señala en forma
general que las limitan los requisitos obligatorios a prescripciones esenciales, al tiempo que dejan al
mercado las soluciones técnicas específicas para cumplir esas prescripciones, ya sea a través de
normas voluntarias o mediante soluciones propuestas por los propios fabricantes. (i) ¿Puede la UE
indicar de qué depende una u otra opción? (ii) ¿Puede la UE indicar si los nacionales de otros países
Miembros pueden participar en la elaboración de esas normas voluntarias o de las solucionespropuestas por los fabricantes y, en su caso, que procedimiento concreto ha de seguirse al efecto?
A: (i) Essential requirements define the results to be attained, or the hazards to be dealt with, but do
not specify or describe the technical solutions for doing so. The application of harmonised standards,
which give a presumption of conformity to the essential requirements, remains voluntary in the fieldof new approach directives. The manufacturer has the choice.
(ii) Since the European standards bodies do not claim to be international bodies, participation in their
work on the elaboration of European standards is commonly limited to the national standards bodies
of the European sphere (15 MS, EFTA countries and some candidate countries). This is done on
purpose because otherwise the European standardisation system (by attracting as many participatingcountries as possible) would detract interest form the international standards bodies or even be in
conflict with the international standardisation system operated by the ISO, IEC and ITU. This would
potentially create confusion and hence, distort international trade.
However, as the European standards bodies and their national member are committed to international
standardisation they have cooperation agreements with the international bodies ISO, IEC and the ITU.
For instance, under the agreement between ISO and CEN there are provisions for mutualWT/TPR/M/102/Add.2
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representation at meetings of committees and working groups allowing for up to four representatives
being appointed to attend the meetings of technical bodies of the other organisation.
El párrafo 41 del capítulo III del IS, señala que los fabricantes deben fijar la marca “CE” en los
productos, a fin de indicar que cumple con las prescripciones esenciales del reglamento o norma
técnica correspondiente. (i) ¿Puede la UE descri bir el procedimiento para obtener la marca “CE”?
(ii) ¿Pueden obtenerla empresas que se encuentren fuera del territorio de la UE y, si es así, quéprocedimiento deben seguir? (iii) ¿Es posible que organismos de certificación ubicados fuera del
territorio de la UE sean acreditados/autorizados para evaluar la conformidad y, otorgar el derecho
al uso de la marca “CE”?
A: (i) The procedures for fulfilling the requirements of the new approach directives and the affixing of
the CE mark are described in detail in the Guide to the New and Global Approach on the following
web-site address:
http://europa.eu.int/comm/enterprise/new approach/legislation/guide/legislation.htm
The Guide is available in all EC languages including Spanish.
(ii) Manufacturers from outside the EU are subject to the same technical requirements as EUmanufacturers when having products their products approved for being placed on the EU market. For
third country producers without a manufacturing presence within the EC, an importer must be used.
This is also explained in the Guide.
(iii) Certification Bodies operating under the new approach must be established on the territory of one
of the Member States, however sub-contracting arrangements between test and certification bodies
allow certain tasks to be done in the third countries. See Chapter 6 of the Guide.
En el párrafo 42 del capítulo III del IS, se señala que se pide a los Estados miembros de la UE el
reconocimiento mutuo de los productos legalment e producidos y comercializados en otro Estado
miembro. (i) ¿Es posible para un país no miembro de  la UE acceder a estos reconocimientos mutuos?
(ii) ¿Qué procedimiento tendría que seguir ese país?
A: Mutual recognition of products legally marketed in one territory by the other depends within the
EU on the common adoption by its Member States or candidate countries of the corpus of EU
regulation for such products (the acquis co mmunautaire). See Document G/TBT/W/173/Add1:
Implementing policy for external trade in the fiel ds of standards and conformity assessment: a tool
box of instruments in which this question is discussed.
En el párrafo 43 del capítulo III del IS, se señala que en febrero de 2002, se adoptó el marco general
de principios de la ley para alimentos. ¿Puede la UE aclarar qué implicaciones comerciales para
terceros países tendrá esta nueva legislación?
A: The draft of Regulation (EC) No 178/2002 of the European parliament and of the Council of 28
January 2002 laying down the general principles and requirements of food law, establishing the
European Food Safety Authority and laying down procedures in matters of food safety has been
notified as a proposal to the WTO for comments (G/SPS/N/EEC/110 of 8 February 2001 with an
extended deadline of 26 May 2001). No comments were received from third countries.
En el párrafo 44 del capítulo III del IS se señala que “por lo general” los reglamentos técnicos de la
Comunidad y de sus Estados miembros se publican para la presentación de observaciones por un
plazo de 60 días. ¿Puede la UE indicar en qué casos y bajo qué supuestos un reglamento técnico NO
se publica para la presentación de observaciones, o bien, en qué casos y bajo que supuestos el plazo
puede ser inferior a 60 días? (ii) ¿Puede la UE describir el procedimiento al que son sometidas las
observaciones que son remitidas por sus nacionales y, por lo tanto, por los Miembros de la OMC yWT/TPR/M/102/Add.2
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sus nacionales? (iii) ¿Puede la UE indicar de qué manera da a conocer a quienes presentan
observaciones, las respuestas a las mismas? (iv) ¿Puede indicar la UE cuál es el plazo normal deentrada en vigor de un reglamento o norma técnica y cuales son las excepciones a esa regla, así
como los supuestos en los que aplican?
A: (i) The concerned cases can be (a) emergency procedures and (b) no need for notification
according to the provisions of the TBT Agreement (because a measure does not meet the necessaryconditions for notification).
(ii) Comments are distributed to the competent services, analysed and taken into consideration by the
actors of the legislative procedure.
(iii) The EC systematically replies to all comments received from third countries. Answers are sent to
the TBT Contact Points and they are often discussed in the framework of the TBT Committeemeetings.
(iv) This depends on the form of the legislative Act chosen (i.e. Regulation, Directive, etc) and allows
sufficient time for adaptation of the concerned sector.
En el mismo párrafo 44, se señala que las organiza ciones europeas de normalización y sus comités
nacionales han aceptado el Código de Buena Conducta para la Elaboración, Adopción y Aplicación
de Normas, anexo al Acuerdo de Obstáculos Técnicos  al Comercio. (i) ¿Puede la UE aclarar si todos
los organismos nacionales de normalización de sus Estados miembros (vgr. Asociación Española de
Normalización-AENOR, British Standards Institution-BSI, etc.) han aceptado ese Código?
A: Mexico does not seem to be aware that the national committees of the European standards
organisations are the national standards bodies of the EU member states. And as stated in the report,all of these national bodies which make up to European bodies CEN and CENELEC have accepted
the TBT code of good practice.
Questions from the United States:
We remain concerned that the EU’s focus on internal transparency has compromised third country
opportunities to influence the development of technical regulations as foreseen by the transparency
obligations of the WTO TBT Agreement. As the EU ’s WTO notifications of its regulations are made
only after the EU reaches a "common position"intern ally, how can the EU argue that its notifications
are "made at an early appropriate stage, when amendments can still be introduced and comments
taken into account"?
A: In line with obligations under the TBT Agreement, the Commission notifies draft regulations at an
early apporpriate stage when comments can still be both made and taken into. In many cases, this is
following agreement on the draft regulation by th e Commission. However, for some regulations, it
may take place at a different stage in the adoption process.
As the EU is aware, the United States and a large number of other WTO members registered strong
concerns at the last TBT Committee meetin g with EC Commission Regulation No. 753/2002 as
regards the description, designation, presentation and protection of certain wine sector products. The
Regulation was only notified to other WTO membe rs after its adoption (G/TBT/N/EEC/15) whereas
the TBT obliges Members to notify proposals, provide a meaningful opportunity for comment, and
take those comments into account before adopting a final regulation. Significant questions and
concerns were raised about the WTO compatibilit y of the substance of the Regulation, including its
restrictions on the use of descriptive and/or generic terms (e.g., "vintage," "ruby," etc.) which have no
specific connection with a geographical source or even a given class of goods and its prohibition of
the use of certain bottle shapes by all but EU pr oducers. We would appreciate information from the
EU on how it justifies this Regulation, particularly in light of the provisions of TBT Article 2. WeWT/TPR/M/102/Add.2
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would also appreciate informati on on why the EU failed to notify the regulation as a proposal and
denied WTO members their rights for an opportunity to comment prior to its finalization.
A: Regulation notified under TBT Agreement on 10 June 2002 [ref. G/TBT/N/EEC/15]. Regulation
enters into force on 1 January 2003. Deadline for written comments from WTO Members was the 30
September 2002. Take note of TBT obligation to take comments from WTO Members into account.
The EU’s new regulation on wine-labeling requires third countries to apply to the EU for the right to
use certain words on labels. What is the criteria, procedure and time-frame for such applications to
be approved? Why is this possibility not offered for all terms, including "vintage" and "ruby?"
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.
How does the EU explain the SPS Agreement consiste ncy of imposing wine-making rules that are not
related to health and safety concerns on imported wines?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans toprovide a comprehensive written response to the points raised shortly.
Questions from Brazil:
A proposal that has recently been approved in the European Parliament establishes that products
whose composition contains a minimum of 0.5% of  Genetically Modified Organisms be subjected to
labeling. Is there a scientific basis for establishing that limit at 0.5%?
A: The Commission proposed in the proposal for a Regulation on GM food and feed (notified under
G/TBT/N/EEC/6 and G/SPS/N/EEC/149) that a threshold of a maximum of 1% (with the possibility
to establish lower thresholds in comitology) would be introduced for the adventitious or technically
unavoidable presence of unapproved GM material in food and feed which have at least received a
positive evaluation by the relevant scientific committee of the European Community.
The value of 1% is a compromise between the state of detection methods and the feasibility along the
production chain. The experiences with the 1% value have shown that the value of 1% is
implementable by Member States and control laboratories.The European Parliament in its first reading ha s adopted an amendment reducing the threshold to
0.5% and making it applicable only to material produced from GMOs authorised under Community
legislation.
The Commission has declared in Parliament that it does not accept this amendment.
Could the EU provide some clarification on the way the recently created European Food Agency will
work? Brazil is particularly interested in knowing whether there is any relation of hierarchy or
cooperation between that agency and the many technical committees that already exist within the EU.
A: The Regulation which provides the legal basis for the establishment of the European Food Safety
Authority was formally adopted on 28th January 2002 and thus paved the way for the Authority to
start its operation as early as possible in 2002.WT/TPR/M/102/Add.2
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The European Food Safety Authority is a Community  body with its own legal identity, funded from
the Community budget but operating independently of the Community institutions. It is not thereforemanaged by the Commission but once selected by an Executive Director who in turn will be
answerable to a Management Board.
The primary responsibility of the Authority is to provide independent scientific advice on all matters
with a direct or indirect impact on food safety. Th e Authority has been given a wide brief, so that it
can cover all stages of food production and supply, from primary production to the safety of animalfeed, right through to the supply of food to consumers.  It will gather information from all parts of the
globe, keeping an eye on new developments in science. It will share its findings and listen to the
views of others through a vast network that will be  developed over time. As well as interacting with
experts and decision-makers on many levels, EFSA will communicate directly with the public on its
areas of responsibility.Although the Authority’s main "customer" will be the Commission, it will be open to respond to
scientific questions from the European Parliament and the Member States and it can also initiate
scientific investigations on its own behalf. The Authority will carry out assessments of risks to the
food chain and indeed can carry out scientific assessment on any matter that may have a direct or
indirect effect on the safety of the food supply, including matters relating to animal health, animalwelfare and plant health. The Authority will also give scientific advice on non-food and feed GMOs,
and on nutrition in relation to Community legislation.
Scientific Committee and Panels
A Scientific Committee and several Scientific Panels will be responsible for the scientific opinions of
the Authority.
A Scientific Committee will be responsible for the general co-ordination necessary to ensure theconsistency in the scientific opinions of the different panels. This Committee will be composed of the
chairpersons of the scientific panels and six independent experts who do not belong to any panel.
The Scientific Panels will be composed of independent scientific experts selected following an open
call for expressions of interest and appointed by the Management Board. They will be selected on the
basis of criteria of competence, knowledge, independence and experience. Members of the ScientificCommittee and Panels will not be employees of the EFSA.
The following 8 panels will be established:
- Panel on food additives, flavourings, processing aids and materials in contact with food;
- Panel on additives and products or substances used in animal feed;
- Panel on plant health, plant protection products and their residues;- Panel on genetically modified organisms;
- Panel on dietetic products, nutrition and allergies;
- Panel on biological hazards (including TSE/BSE issues);
- Panel on contaminants in the food chain;
- Panel on animal health and welfare.In accordance with the Regulation, until the Committee and Panels are established scientific advice on
matters falling within the competence of the Authority will continue to be provided by the existing
scientific committees established by Commission De cisions supported by Commission civil servants.
However, once the Authority is operational the above Committee and panels will replace those
currently managed by the Commission. In this way the responsibility for the provision of scientificadvice to support the legislative programme will be transferred to the Authority.
What are the criteria on which the European Food Agency bases its decisions? If those decisions are
based on scientific criteria, then why is voting — and not unanimous decisions — required?
A: The European Food Safety Authority is a ri sk assessment and communication body and will be
responsible for the provision of scientific advice on all matters with a direct or indirect impact on theWT/TPR/M/102/Add.2
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safety of the food and feed supply. The EFSA does not take legal decisions but provides scientific
advice and scientific information. The scientific opinions are developed through discussion of leadingindependent scientists who are members of the Scientific Committee and 8 panels. These opinions are
adopted by a majority of the members of each Scientific Committee and Panels and minority opinions
are always recorded. Even if in practice most scientific opinions are consensual because they express
the state of the scientific knowledge, a voting system has been provided for in order to ensure that
minority opinion are always recorded..
The European Commission has recently approved a regulation that changes the maximum level of
residues for dimetoate in cereals and products of vegetal origin at a lower level than that established
by the Codex Alimentarius as acceptable daily intake. No scientific explanation was given. This rule
seems to be incompatible with many provisions  of the WTO Agreement on Sanitary and Phytosanitary
Measures, particularly articles 2.2 to 2.4, 3.2, 3.3, 5.1 and 6.1. Could the EU provide a scientific
explanation for that decision?
A: The Commission will shortly adopt a directive reducing the MRL for dimethoate in many products
of plant origin to the lower limit of analytic al determination (LOD). This follows a scientific
assessment indicating a risk to the health of consumers from ingestion of dimethoate residues in
foods. All types of foods were examined, including cereals and citrus. For foods where intake was
acceptable, the MRL was not changed. Where an MRL was not acceptable and where it was necessary
to reduce it then a good agricultural practice consistent with a reduced MRL was looked for. Where
this was found, the MRL was reduced. Where no good agricultural practice could be found, the MRL
was set at LOD. MRLs set at LOD can be reviewed at any time and increased to levels safe for
consumers on the basis of new data submitted by any interested parties. The MRLs being set willapply to produce produced in and imported into the Community. A copy of the draft regulatory text
can be made available to interested parties. The proposed measures have been notified in SPS and all
comments revceived have been considered.
It also seems inconsistent with the principles of the SPS Agreement that the level of tolerance to
dimetoate for citric fruits be different and inferior to that established for similar products, such as,
inter alia, cherries, olives and onions. What are the reasons for that difference in treatment?
A: MRLs are established on the basis of good agricultural practice. There are different GAPs for
citrus, cherries, olives and onions and it is not surprising that different MRLs should be establishedfor each. For cherries, olives and onions, the data specific to these crops was considered
The notification G/TBT/EEC/15 deals with the European Commission Technical Regulation number
753/2002, of April 29th 2002, on rules related to the description, designation, presentation and
protection of certain wine sector products. Some of the requirements relate to the size of thecharacters that present the region where the person in charge of commercialization is situated.
Therefore it deals with just a descriptive characteristic of the product, and not with its
“performance”. How is that requirement compat ible with article 2.8 of the TBT Agreement?
A: The regulation (ref. 753/2002) was notified under the TBT Agreement on 10 June 2002 [ref.
G/TBT/N/EEC/15]. It will apply as of 1 January 2003. The EC has extended the deadline for written
comments from WTO Members to 30 September 2002. The EC is carefully studying comments
received from WTO members, notably in the context of the TBT notification. The EC plans to
provide a comprehensive written response to the points raised shortly.WT/TPR/M/102/Add.2
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Question from Malaysia:
The Union’s large number of over 100 notifications to the TBT Committee annually testifies to
significant number of regulatory changes of a technical nature. What action has been taken by the EU
to assist developing countries to cope with adjustments to such changes?
A: In the TBT Committee, work is progressing well on the development of a technical assistance
programme. The EU agrees that there is a need to develop further and, more generally, enhancebilateral, regional and multilateral efforts. At regional and bilateral level, the European Commission
runs many TBT technical assistance programmes. This is also true of the Member States. We are
ready to consider requests to address identified pr iorities / needs, including the possibility to help
developing countries adapt to new or modified technical regulations.
It should also be noted that the large number of notifications referred to in this question also reflectsthe European Community’s commitment to discharge the transparency obligations imposed under the
TBT agreement.
Question from Chile:
¿Qué importancia le asignan las CE a la armonización de sus reglamentos técnicos
intracomunitarios? ¿Y respecto de las normas internacionales?
A: The EU has attached great importance to the harmonisation of technical regulations for many
years. The Treaty which establishes the European Community includes a Chapter on the
approximation of laws of the Member States (see Articles 94-97). These Articles have provided the
legal basis for the harmonisation of technical regulations and have resulted in a large number of
Directives helping to create a large internal market in most product sectors. In addition, theapplication of Directive 98/34/EC prevents the emergence of diverging national technical regulations
and standards.
The EU also attaches great importance to the use and development of international standards.
Internationally traded goods need international st andards. European stakeholders are interested in
collaborating with their trading partners to facili tate market access and economic integration through
the use of international standards and the creation of standards-receptive economic and legal
conditions. Generally, regional or national standards should be aligned to the greatest possible extent
to international standards, but the value of national and regional standards as stepping-stones to
international standardisation should also be recognised.
Questions from India:
The problem of widely different standards is particularly acute with regard to sea-food consignments.
Presently, there is no harmonised standard laid down by EC for testing, inspection and analysis of
various micro biological and chemical contaminations including residues in the sea-food
consignments. This causes difficulties to the ex porters in implementing varying standards, which often
results in detention of sea-food consignments at EU ports. The EU border inspection posts have also
been testing, under the food safety standards, for parameters, which have not been specified in EU
regulations. For example, the norm for minimum quantity to be tested for any food product to test
negative for any bacteria is 25 gram. This is, however, not specified in the regulations. By when does
EU propose to harmonise such standards?
A: The EU had in the past the policy to harmonise sanitary and phytosanitary standards by bringing
closer the national rules of Member States. This policy is no longer valid because the SPS Agreement
imposes to base these standards on a scientific assessment of the risk. In order to comply with this
obligation, the EC has established an independent scientific body for assessing the risks: the European
Food Safety Authority (EFSA). On the basis of th e advice provided by this EFSA, the Commission
will propose to Member States to adopt common SPS standards when necessary.WT/TPR/M/102/Add.2
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To be able to meet the SPS requirements of various EU member countries, there is a need to have
access to not only the common EC norms but also the specific additional norms of the membercountries. It is felt that there is dearth of information and lack of transparency on the diverse
procedural norms and regulations of the EU member states relating to specifications as well as
methods of sampling, inspection and test. This appears to be one of the reasons for difference in
results at the exporting and importing end. These n eed to be clearly laid down by the EU member
States for various parameters being tested and made available transparently as well as in an easilyunderstandable form to the exporting countries so that these could be taken into consideration by
industry as well as the Competent Authority during inspection and certification to avoid variation in
results which may be the cause of rejection at th e importing ports. How does EC propose to improve
such access to common EC norms and specific additional norms of individual member countries?
A: The proposal on official feed and food controls referred to above replies, as regards methods of
sampling, inspection and testing, on international standards to which all have access.
In cases of rejection of export consignments, there is no provision for joint testing and an appeal
mechanism, which are available with other major developed countries. It is felt that such a
mechanism is important in the interest of greater transparency and fairness as Indian exporters have,
at times, experienced that the rejected export consignments on being brought back to India and tested
showed absence of any contamination. One such examp le is rejection of a consignment of shrimps by
Spain on grounds of antibiotics (chloramphenicol) contaminant. Does EC propose to institute such
joint testing and appeal mechanism?
A: Provisions for joint testing and appeal mechanism is clearly a matter for Member States
prerogative in the framework of the subsidiarity. The EC has no intention to institute an European
joint testing and appeal mechanism.
EC does not accept Health Certificate issued retrospectively, which at times, is necessitated on
account of unavoidable circumstances. The Codex guide lines for ‘generic official certificate formats,
production and issuance of certificates’ provide for issuance of certificates on retrospective basis if
agreed by the competent authorities of the importing and exporting country. Does EC propose to
change its regulations to permit acceptance of health certificate retrospectively in some genuine
cases?
A: The proposal on official feed and food controls referred to above will contain procedures that may
allow to fix special conditions with regard to official certification. These procedures may be used to
lay down more specific rules on the reliability of certification, including the time of certification.
EU authorities have started destroying the contam inated consignments (biological or chemical
contamination) instead of returning them to the exporting countries as requested for by the
exporter/importer. Such destruction leads to wastag e of a large amount of money as in some cases,
assessment of brought back consignments shows abse nce of contamination, or at times, contamination
can be taken care of through re-processing. Complete re-testing of brought back consignment is alsonecessary to identify the contaminants and take necessary corrective measures for its control/to
eliminate its recurrence. EU is requested to indicate whether it proposes to re-consider its policy on
the above grounds?
A: The protection of the consumer’s health is not limited to the European Consumers and the EU has
been criticised in the past for exporting or re-e xporting foods that did not comply with the European
level of protection. The EU legislation lays down that a dangerous food cannot be re-exported butmust be destroyed.WT/TPR/M/102/Add.2
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One of the key elements of the Agreement on SPS is ‘harmonization’ in which member countries are
expected to base their SPS measures on international standards. It also means that within the EU
member states, there should be common norms followed. It has been observed that member countries
are at times observing norms different from the common EU norms. During processing, an exporter
may at times not be clear about the specific country of destination within the EU countries. As a
result, while certifying the consignments of mari ne products for export to the countries of EU, it
becomes difficult for Export Inspection Council to decide against which norms to certify which may in
effect lead to rejection of the product. In order to streamline exports of marine products to the
countries of EU, it is important that the member countries of EU follow the common EU requirements
in order to avoid any rejections due to lack of harmonization of norms within EU member countries.
How does EU propose to address this issue?
A: If an EU norm is established, the Member States cannot derogate from it unless a specific
derogation is foreseen in the EU regulation. If no EU norm exists, Member States are allowed to keep
their national legislation until a common rule is established. They can also establish a new norm
following a procedure of consultation with the Commission and the other Member States. For theharmonisation of SPS standards see reply to India’s first question in this section.
The EU defines whisky as a beverage made from grain based alcohol. On the other hand, in India,
whisky is manufactured from molasses based alcoho l, which is not inferior to cereal-based alcohol.
Does EU propose to modify its definition of whisky to take account of India’s concern? Also, the EU
has prescribed for maturation of whisky in a wooden cask of a specified size for a minimum period of
three years. The experience shows that the maturation is greatly accelerated in temperate climate anda beverage which may take three years to mature in a cold country/climate, would take much shorter
period to mature in a hot/temperate climate. Is EU willing to stipulate a suitable minimum period for
whisky produced in warmer country like India?
A: Council reg. 1576/89, art. 1, par.4 (b) regulates this matter. There is no proposal of modification of
the regulation above mentioned.
Indian exporters of grapes, gherkins, etc. face a major problem of export to EU on account of
different pesticide residue levels followed by different Member states of EU, despite the fact that there
are EU wide harmonised levels prescribed by the EC as well as Codex levels. This is resulting in asituation where the Indian exporters are able to trade with only some of the EU countries. India
would request EU to comment on this observation. It  would also like to know whether EU proposes to
harmonise pesticide residue levels?
A: The Commission has a programme of work on the gradual harmonisation of all pesticides
maximum residue levels (MRLs). Where MRLs  are harmonised, they apply throughout the
Community and for both domestic and imported produce. Where they are not yet harmonised, then the
Member States may set MRLs at the national level. Full details of the MRLs and the programme of
work are available on the Internet site of the Commission.
It is reported that pesticide residue level for Indian tea are fixed by using made tea and on the basis of
the lowest limit of detection as per the efficiency of the analytical equipment rather than on a realistic
system of residues in the brewed tea that is consumed. The most important point to note is that
pesticides residue in the made tea do not get fully dissolved in the brew that is finally consumed. It
would therefore be realistic if the maximum residues levels (MRLs) are fixed after taking into account
the toxicity data. Moreover, it has also been report ed that MRLs fixed by EU are different from theWT/TPR/M/102/Add.2
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ones fixed by Germany. Does EU propose to have a syst em of analysis based on residue in the brewed
tea and also to harmonize the residue levels?
A: Maximum levels for pesticides residues (MRLs) in tea are set on the basis of data on residues
arising after good agricultural practice has been foll owed i.e. the authorised conditions of use of a
pesticide on the crop. The levels that are set apply to the dried leaves i.e. the produce moving in
international trade. This is consistent with the practice of the Codex Alimentarius Commission. TheMRLs have to be protective of the consumer and when a dietary intake assessment is done for tea, on
a pesticide by pesticide basis, the partitioning of the residues between the leaves (not consumed) and
the beverage itself (consumed) is taken into account. The fact that, for some pesticides, residues
remain fully on the leaves is not a valid reason to increase the permitted MRL (for the reason given in
the first sentence).
EU has a regulation fixing the percentage of use of benzoic acid as an additive at 0.2% in the case of
cooked shrimps. On the other hand, cooked crangon and crangon vulgaries which are of European
variety shrimps enjoy a maximum level of 0.6%. Th is puts exports of shrimps from India and other
Asian countries at a disadvantage. India has presented evidence to show that average size of speciesfound in Indian waters is comparable to the EU variet ies. Does EU propose to revise percentage fixed
for benzoic acid as additive for Indian shrimps?
A: The position of the European Commission on the use of benzoic acid in cooked shrimps has been
unchanged since the adoption of the Directive 95/2/EC on food additives other than colours and
sweeteners. The use of benzoic acid is permitted as a preservative in cooked Crangon crangon and
Crangon vulgaris varieties at a level of 6000 mg/kg due to hand peeling of these small-size shrimps.Benzoic acid is permitted in other cooked shrimps at a level of 2000 mg/kg, as it has been estimated
to suffice in order to preserve these products for a reasonable time.
The Member States of the European Union have monitored food additive intake in their respective
countries. In October 2001, the Commission adopted a re port on dietary intake of food additives in the
European Union (COM(2001) 542 final). In the conclusions of this report, the Commission requestedthe Member States to carry out more detailed intake estimation for certain additives based on actual
food consumption data combined with the actual usage levels of the additive. This was due to
potential exceeding of the acceptable daily intake (ADI) allocated to the additive. This request
includes benzoic acid and benzoates (ADI 5 mg/kg b.w). In addition, the Scientific Committee on
Food is currently re-evaluating the safety of benzoates.The Commission is waiting for the above-mentione d information from the Member States and the
opinion of the Scientific Commitee on Food before it can initiate any action on this particular food
additive.
The EU has stipulated that there should be ‘plant approval’ prior to imports of Indian dairy products
for human consumption. As there is no agency fo r carrying or providing plant approval, India’s
exports of dairy products into the EU have now totally ceased. By when does EU propose to notify
agencies for carrying our or providing such plant approvals? When was the last such plant approval
granted for any other country and when was the application submitted?
A: India is on the list of countries authorised to export milk and milk products to the EU. The exports
of milk and milk products can take place under a bilateral agreement with one ore more Member
States stipulating the list of dairy plants that comp ly with the sanitary conditions laid down in the EU
legislation. The responsibility to approve dairy plants for export to the EU belongs to the national
competent authorities of the exporting country. The evaluation of the competent authority by the EU
inspection body follows the guidelines issued by  the Codex Alimentarius Commission. For the timeWT/TPR/M/102/Add.2
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being there is no plant approval granted for any other country. When the EU will approve such lists of
plants, the imports of milk and dairy products will be restricted only from the plants on the list.
EIC is the official inspection and certification body of Government of India for certifying products for
exports. Certification is given on the basis of different systems of inspection – Consignment wise
Inspection (CWI) or a systems approach which includes HACCP. While certifying for exports, the
requirements of the importing country are taken into account. To enable quicker and smoother accessinto the European markets, it is felt that EC member states need to recognise the EIC certification for
all products including food products imported into their country rather than duplicating the
inspection and testing. What is EU’s stand on executing MRA with EIC?
A: The official inspection and certification in India for certifying fishery products is the EIC
recognised as competent authority by Commission Decision 97/876/EC. An evaluation of the
competent authority based the guidelines established by the Codex Alimentarius Commission is
needed on a case by case basis prior recognition by the EU. For products of animal origin it is
necessary to take into account the health status of the country and the residues monitoring plan
presented by the Country.
As a result of EU’s directive on conformity to CE certification marking, electronics hardware
including instruments are required to conform to EU’s Certification on the product/products before
they are imported into EU countries. Compliance to this directive entails completion of a lot of
formalities and additional costs on the product(s). Be sides, this is a time-consuming procedure. All
these extra costs tend to erode the competitiveness of Indian electronics exporters to EU countries.
Can EU give the rationale for these measures? Does it propose to simplify the procedures?
A: Electronic products, which fall in the scope of  the Low Voltage Directive - LVD (73/23/EEC,
amended by 93/68/EEC) and the directive on Electromagnetic Compatibility - EMC (89/336/EEC,
amended by 92/31/EEC and 93/68/EEC), have to co mply with the essential requirements (ER) of
these directives when placing on the European market.One way to reach compliance with the requirements of these directives is to apply the relevant
European harmonised standards to the products. Most of the European harmonised standards are
transposed from the international IEC standards without any changes. Having applied the relevant
European harmonised standards the manufacturer can fill out the declaration of conformity (self-
declaration) and affix the CE marking on the product. The manufacturer of electronic products is notobliged to have his product certified by a third party.
Very useful information can be found on the following websites of the European commission:
a) The Low Voltage Directive
http://europa.eu.int/comm/enterprise/electr_equipment/lv/index.htm
b) Guidelines on the application of Directive 73/23/EEChttp://europa.eu.int/comm/enterprise/electr_equipment/lv/guides/index.htm
c) Electromagnetic compatibility
http://europa.eu.int/comm/enterprise/electr_equipment/emc/index.htm
d) Guidelines on the application of the Directive 89/336/EEC
http://europa.eu.int/comm/enterprise/electr_equipment/emc/guides/emcguide.htme) Guide to the Implementation of Directives Based on New Approach and Global Approach
http://europa.eu.int/comm/enterprise/new approach/legislation/guide/legislation.htm
f) List of New Approach Directives and references of harmonised standards
http://europa.eu.int/comm/enterprise/newap proach/standardization/harmstds/reflist.html
The health certificates issued for fish and fishery products are in English. However, the Spanish
Health Authority for some time have started insisting that the health certificate should be filled inWT/TPR/M/102/Add.2
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Spanish for the consignments meant for export to Spain. Indian EIA officials find it difficult to fill up
health certificates in Spanish. EU is requested to in dicate as to by when such a requirement would be
removed or what other arrangements can be made for trade facilitation?
A: The Official Journal of the EU publishes the health certificate in the 11 languages of Member
States. Multilingual certificates are used by most of countries in the word without problem.
As there is no agency or department in EU that is recognized by the Ministry of Health as responsible
to accept applications from manufacturers reque sting UK MCA authorities to visit and certify
facilities. Today pharmaceutical manufacturers have to approach regulatory consultants or
distribution companies to assist them in arrang ing UK MCA certification which is time consuming
and expensive and also acts as market access barrier. India would like to know whether EU has anyplans to establish any agency or department res ponsible to accept applications from manufacturers
who file requests to UK MCA authorities to visit and certify facilities?
A: The obligations for the manufacture and import of medicinal or veterinary medicinal products are
explicitly laid down in EU pharmaceutical legislation. The import of pharmaceutical products is onlypossible if a company in an EU Member State has a Marketing Authorisation for a certain product
coming from a third country. Interested companies or other parties are invited to visit the following
website (http://www.pharmacos.eudra.org/F2/eudralex/index.htm). Here they can find the current
pharmaceutical legislation.
It is not planned to establish any centralised agency or department responsible for accepting or giving
advice on applications from third countries. It should also be noted that for European applicants to
receive a Marketing Authorisation, they also have to contact either the responsible authority in theirMember State (national MA) or in several Member States, or the EMEA (European Agency for the
Evaluation of Medicines in London) in the case of centrally authorised medicinal products. The
procedures are exactly the same for European applicants. If a European company does not have a
person with appropriate knowledge on their own staff,  they have to approach specialised consultants
too. This is the normal way of business and has nothing to do with market barriers.
Question from Thailand:
The Commission is proposing an “integrated produc t policy,” which employs a Product Life Cycle
Approach as the strategy on the sustainable use of resources and on waste recycling. We understand
that this proposal has yet to be officially announced  or notified to the WTO. Nonetheless, we would
like to caution that the regulation, once impl emented, may impose additional and unwarranted
burdens upon producers and exporters from third countr ies, especially those small and medium-sized
enterprises in developing countries. These enterprises are not yet capable of meeting the requirements
or able to upgrade their production methods to be in conformity with the regulation.
We would appreciate the EU’s clarification on the latest status of the proposed directive and on anyfuture accompanying measures that would help am eliorate or minimize possible negative impacts on
business operators, particularly in developing countries, should the proposal become effective.
A: The Commission is in the process of developing three different, yet inter-related initiatives:
- a thematic strategy on the sustainable use of resources;
- a thematic strategy on recycling; and
- an integrated product policy (IPP).
None of these will lead immediately to product-related legislation and all will be developed in
consultation with all stakeholders. Consultation documents on recycling and on resources will be
produced over the next 12 months as a prelude to the final strategies. Stakeholders will be invited to
provide comments. The development of IPP is, however, more advanced. A Green Paper was
published in February 2001 and all interested parties were invited to comment. Over 130 did so,WT/TPR/M/102/Add.2
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including the Thai government. All these comments will be considered when drafting the IPP White
Paper, which is due in the near future. While at this stage it is not possible to state exactly what willbe in this paper, it is clear that any legislative initiatives that may stem from it would have to be
subject to stakeholder consultations.
In any case the Commission is well aware of the concerns raised in the question concerning the effects
of environmental regulation on all producers in developing countries, including SMEs. It realises that
any product-related proposals would have to take th ese into account along with concerns about the
other dimensions of sustainable development
Questions from China:
According to article 5.1 and 5.6 of SPS Agreement,  SPS measures shall be based upon assessment of
risks and shall not be more trade-restrictive than required to achieve their appropriate level of SPSprotection. We therefore believe that the imposition of a full-scale ban on all animal products from a
WTO member or WTO members by EU on the evidence identified only in certain products (e.g.
Commission Decision 2002/69/EC of 30 January 2002 concerning certain protective measures with
regard to the products of animal origin imported fr om China) is inconsistent with SPS provisions.
This measure constitutes discrimination again specific members as animal products from somemembers are treated differently from those from othe rs. Its application is incoherent as it maintains
double standards as to the import and export of an imal products. The EU’s observance to the
principles of both MFN and National Treatment is thus called into question and there appears to be a
tendency that the measures taken under SPS considerations are being abused by EU as a means for
trade protectionism.
We have noticed that “Regulatory activities … are subject, where appropriate, to the obligations
assumed by the EU and the Member States under the WTO agreement on TBT and SPSagreement”(Page 39, Para.44 of Secretariat Report). We  would like to invite the EU to clarify the
justification of its above-mentioned measure in the context of SPS Agreement, in particular Article 5.1
and 5.6.
A: Article 5.1 and 5.6 cannot be read in isolation from the other articles of the SPS Agreement. The
Commission decision is not only based on the evidence of the contamination by prohibited substances
of more than 80 consignments of food imported from China. This decision is based on the evaluation
of the inspection system, sampling and testing procedures, according to article 5.2 of SPS Agreement,
showing severe shortcoming. The procedure for this evaluation follows the guidelines established by
the Codex Alimentarius Commission (CAC/GL 26-1997). The definition of risk assessment in the
Annex A to SPS Agreement is the evaluation of the potential for adverse effects on human or animal
health arising from the presence of additives, contaminants, toxins in food. With regard to the
available evidence, the Decision taken by the EU is consistent with the SPS requirements.
Article 2.2 and Article 2.8 of TBT agreement state that “technical regulations shall not be more
trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-
fulfillment would create.” and “Wherever appropriate, Members shall specify technical regulations
based on product requirements in terms of performance rather than design or descriptive
characteristics.” In view of the provisions, it is ou r belief that the EU adoption of the’Lighters-Child-
resistance for lighters - Safety Requirements and Test Methods’, which makes the installation of child-resistance device compulsory for any lighter with a customs valuation or ex-factory price under EUR
2.00 a discrimination against the products affected by the measure. The price-based safety
requirements is questionable in terms of its scientific basis and constitutes a hidden barrier to normal
trade which is inconsistent with the relevant provisions of TBT agreement.
We would like EU to explain the rationale of its measure in relation to the WTO TBT Agreement, and
request early abolishment of the measure.WT/TPR/M/102/Add.2
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As the most affected party by the CR criteria, we are gravely concerned with the matter. We have
noticed that revision process of the Standard was initiated by EU in early July, and we welcome themove. We would like to positively take part in the process in a way that will help make criteria
scientific and fair and acceptable to all interested parties.
A: Following a mandate from the European Commission under the General Product Safety Directive,
the European Committee for Standardisation (CEN) published in May 2002 a standard on child safetyrequirements for cigarette lighters. In line with existing similar standards in some other countries, this
standard only applies to lighters that cost under a specific value (in the EU, the limit is € 2). Work is
now underway with the view to abolishing th e € 2 limit in the CEN standard. The European
Commission looks forward to continuing to co -operate closely with China in this area.
(b) Regulatory developments
Chemical products
Questions from Canada:
Paragraph 46 summarizes the EU’s future policy on chemicals. This policy would have the effect of
transferring responsibility from public authorities to industry for the testing and risk assessment of
chemicals. It also outlines a new system of registration, evaluation, and authorisation (REACH) for
new and existing chemical substances applying to producers, importers and downstream users.
Please clarify the extent to which the EU is pre pared to accept data or test results from other
countries in assessing chemicals. More specifically, please indicate if the Community will accept non-
EU test results.
 A: The White Paper clearly states that information generated elsewhere, such as under the US HPVinitiative or the ICCA initiative on "existing" substances, will be taken into account. However, that
information may need to be supplemented in order to meet the requirements of the White Paper.
 The European Commission aims at taking international developments into account when drafting the
future chemicals legislation, in particular the prov isions of the Global Harmonised System (GHS) for
the classification and labelling of chemicals. It will continue to follow-up international activities
working towards greater standardisation/harmonisation in chemicals assessment.
 Under the future EU chemicals system, test data and other information on chemicals will be submittedby individual companies (or groups of them) to the authorities, wherever they were generated. This
includes OECD activities and the voluntary initia tive of the International Council of Chemicals
Associations (ICCA). Authorities will examine, as appropriate, whether the data are valid for EU
purposes or whether they need to be supplemente d. With the EU being an OECD Member, and also in
the framework of the new chemicals policy, EU experts from the receiving authorities will therefore
take proper account of test results from countries which are members of the OECD's Mutual
Acceptance of Data Decision.Thus, the validity of data, to be provided by industry, will be examined "bottom-up" by experts of the
authorities on a substance-by-substance basis. A "top-down" regulatory co-operation between the EU
and Canada does not seem to match with the shift of responsibility from regulators towards industry
on the collection of data, as intended in the White Paper. However, sharing of views and experiences
on the respective approaches in the EU and Canada would be helpful;
Please indicate how the EU will address and trea t products manufactured outside the Community that
may contain untested or unregistered substances.WT/TPR/M/102/Add.2
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A: This is a complex issue. The Commission intenti on is to develop a workable system for substances
in products ("articles"), without putting the ambition of a high level of protection of human health andenvironment at risk.
The Working Group on "Substances in Products", which was one of the eight Working Groups the
Commission had organised from October 2001 to Febr uary 2002, considered that a general obligation
could be established for importers and manufacturers of articles, when those articles contain
unregistered dangerous substances that are released during normal use .
Please explain how manufacturers and downstream users would share the costs and responsibility for
providing the required assessment information. Please explain the impact and financial implications
of the EU scheme for Small and Me dium Sized Enterprises (SMEs).
 A: It is important to be aware of the role of downstream users in the future chemicals system.
Downstream users will be obliged to undertake safety assessments for the uses to which substances
are put, including in articles. The assessments also need to include disposal and waste management
issues. They should keep the assessments to themselves and not submit them to an authority. This
means a limited administrative effort for downstream users.
 When preparing the assessments, downstream users will build on the test data and other information
provided by manufacturers and importers when se lling the chemicals. The Commission thinks that it
will be an advantage for downstream users that this information will be more abundant under the
REACH system than is the case today. It will be an obligation for manufacturers and importers to
provide information and risk assessment for "intended" uses, which will cover downstream uses to a
large extent. The Commission is currently working on the details of implementation in the future
legislation.
 Should a downstream user apply a chemical in a di fferent way ("non-intended use"), he could either
communicate that use to the manufacturer, in order that the manufacturer may add it to the list of
intended uses and provide the downstream user with  additional information. - Or the downstream user
keeps his "non-intended use" confidential. For this case the Commission are considering a simple,
confidential announcement to the authority ("post-card notification"). Additional testing of thechemical will not be necessary if the "non-intended use" can be considered as safe in view of the
available information.
 Only in exceptional cases may additional testing and a particular risk assessment for the "non-intended use" be necessary. It is clear from the White Paper that the testing data should be protected
by property rights. Downstream users may prefer to purchase the chemical from competingmanufacturers who have the "non-intended use" already registered under REACH.
 In conclusion, the future chemicals system should provide an incentive for manufacturers to registeras many intended uses as possible. Downstream users should obtain more information than today,
which will enable them more easily to assess the risks arising from the use of chemicals.
 The possible financial impact of the White Paper on business, including SMEs, has been estimated in
a Business Impact Study undertaken by the Commission. Given the different scenarios and
assumptions about the implementation of the White Paper, costs may range between 2 and 8 billionEuros, with the most likely amount being 3.6 billion Euros over the first 10 years, when existing
substances will be fed into the new system. Further information can be taken fromhttp://europa.eu.int/comm/enterprise/chemicals/conference/conference2/index.htm
The proposed European regime promotes substitution of dangerous chemicals with safer products.
Please share how the EU proposes to implement the authorisation process of the REACH system and
the substitution principle.
A: From past experience, the European Commission considers that bans and restrictions of chemical
substances will continue to be based on risk assessment and expert advice. The advice may includeWT/TPR/M/102/Add.2
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elements from international sources. The Commission would take this advice as the basis for its
decision.The Commission considers it difficult to "command" substitution. The authorisation requirement will,
by itself, encourage substitution. The decision of an  individual company to apply for an authorisation
of a certain chemical substance (or not) will be influenced by the availability of substitutes for that
chemical, as will the granting (or not) of the authorisation. Market forces should help ensure that
substitution is undertaken where appropriate and suitable.
Question from Taiwan:
In February 2001, the EU adopted a White Paper outlining a new chemical policy known as
“REACH” which stands for registrations, evaluations, and authorization of chemicals. The policy
denies access to the EU market of chemical products that are not registered for use or have notreceived the required license from EU authorities. As we feel this policy will disrupt the market and
become a trade restricting measure, we would like the EU to clarify how such policy might be
consistent with WTO obligations. We would also like to be informed of the current legislative status of
this policy.
A: The White Paper on the Strategy for a future Chemicals Policy is the Commission position on what
the future regulatory regime for chemicals might l ook like. The proposal for legislation is currently
being drafted.
The Commission is well aware of WTO concerns and will not introduce any requirements which it
believes are in conflict with WTO rules
Question from Korea:
As the Report by the Secretariat stipulates, the European Commission plans to introduce a
strengthened chemical management system (REACH). It is our hope that before the Commission
implements the plan, it will consult with other interested non-EU countries and their exporting
companies.
A: At present, the Commission is still discussing the modalities for the consultation process
concerning the strengthened chem ical management system (REACH).
Question from Mexico:
En el párrafo 46 del capítulo III del IS se da a conocer que en un plazo de 11 años se establecerá
gradualmente un nuevo sistema de inscripción de re gistro, evaluación y autorización o restricción de
sustancias químicas nuevas (posteriores a 1981) y ya existentes (anteriores a 1981), denominado
REACH. Al respecto, (i) ¿Puede aclarar la UE, si las empresas no establecidas en su territorio
podrán inscribirse en dicho registro? (ii) ¿Qué impacto tendrá el sistema REACH en los flujos de
comercio actuales, y en los costos de producción de productos químicos? (iii) ¿ Por qué la UE hatomado la decisión general y no selectiva de incluir a todos los químicos en el sistema REACH? (iv)
¿La UE ha evaluado el impacto de la carga administrativa que el sistema REACH implicará para
importadores y exportadores de químicos que actúan en el mercado europeo.
A: The REACH system will apply equally to EU manufacturers and importers of chemical substances
into the EU.
The European Commission is currently drafting the legislative proposals along the policy lines
announced in the White Paper. Taking due account of the international commitments of the European
Community, it will in particular ensure that no discrimination will be established between domestic
and imported substances and that the forthcoming legislation will not create any unnecessary
obstacles to international trade.WT/TPR/M/102/Add.2
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The possible financial impact of the White Paper on business, including SMEs, has been estimated in
a Business Impact Study undertaken by the Commission. Given the different scenarios and
assumptions about the implementation of the White Paper, costs may range between 2 and 7 billion
Euros, with the most likely amount being 3.6 billion Euros over the first 10 years, when existing
substances will be fed into the new system. Further information can be taken fromhttp://europa.eu.int/comm/enterprise/chemicals/conference/conference2/index.htm
All new and existing substances exceeding a production or import volume over 1 t per year will be
subject to registration under the REACH requirement s. Industry will have to provide the information
required for each particular substance. Evaluation of all substances exceeding a production or import
volume of 100 t, authorisation of uses of substances with properties of very high concern and possible
restrictions will also normally be considered on a case by case basis.
Questions from Brazil:
As indicated in document WT/TPR/S/102 (page 40, paragraph 46), the White Book, approved by the
European Commission, establishes a new Communitarian policy for chemicals — REACH
(“Registration, Evaluation and Authorization of Chemicals”). What is yet to be done so that the new
regulation can enter into force and when does the EU intend to notify the new rules to the Committeeon Technical Barriers? How can this new legal framework be based on the so-called “precautionary
principle” if such principle is not a part of WTO rules?
A: The European Commission is currently drafting the legislative proposals along the policy lines laid
down in the White Paper. Once presented by the Commission, the Council of Ministers and the
European Parliament will have to adopt the proposals in co-decision. This procedure normally takes 2
- 3 years. Taking due account of the internatio nal commitments of the European Community, the
Commission proposals will in particular ensure that no discrimination will be established between
domestic and imported substances and that the forthcoming legislation will not create unnecessary
obstacles to international trade. The "precautionary principle" is enshrined in the Treaty of the
European Union and therefore one of the underlying  principles of the EU environment policy and
legislation.
Still with reference to REACH, the White Book’s ru les seem to constitute a complex regulatory system
that can be of very difficult implementation. Furt hermore, it creates obstacles to about 9% of the
world trade, and its distortive effects could affect  the global markets of many products. Thus some
points in the project should be further clarified in light of the following aspects: (a) an increase incosts; (b) an increase in the number of tests in animals that has not been authorized by WTO rules;
(c) an eventual ban on imports; (d) arbitrary discrimination; (e) precautionary principle; (f) a
disproportional impact on small and medi um enterprises; (g) access to confidential information; (h)
possible export difficulties for developing countr ies. How are the regulatory obligations of REACH
compatible with TBT and other WTO agreements?
A: (a), (f): The possible financial impact of the White Paper on business, including SMEs and
importers, has been estimated in a Business Impact Study undertaken by the Commission. Given the
different scenarios and assumptions about the implementation of the White Paper, costs may rangebetween 2 and 7 billion Euros, with the most likely amount being 3.6 billion Euros over the first 10
years, when existing substances will be fed into the new system. Further information can be taken
from:
http://europa.eu.int/comm/enterprise/chemicals/conference/conference2/index.htm
(b): An increase in the number of test animals that has not been authorised by WTO rulesIt has been incorrectly assumed that the Commissi on would propose a (re-) testing programme for the
30,000 substances covered by REACH. This is not the case. The White Paper proposes a staggered
approach to collect the necessary information on chemical substances to enable appropriate riskWT/TPR/M/102/Add.2
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reduction measures where needed. Testing should only be the last resort, if industry cannot make the
information available.Information could come from existing information held by industry, from abroad (OECD, ICCA (=
International Council of Chemical Associations), USA, Canada, etc.), be it results from testing (in
vitro and in vivo), QSAR, analagous substances. In some cases there may be a good case for no
information being required at all. The Commission is currently considering measures to avoid double
testing of the same substance by different producers, including international producers.It is important to recall that
- An estimated 20,000 "existing" substances between 1 and 10 tonnes per year per
manufacturer will generally only require in vitro testing. This represents 2/3 of the estimated
30,000 "existing" substances in the EU, and will considerable reduce testing costs, time and
animals;
- The testing of substances above 100 tonnes for long-term effects, which is quite intense in
costs, animals and time, will be tailor-made. For each such substance industry will have the
opportunity to provide the evidence how testing can be reduced to a minimum;
- Testing requirements could be reduced for substances used exclusively in industry under
rigorous containment.
It is true that only few in vitro tests are currently available for regulatory purposes, but substances
between 1 and 10 tonnes need to be registered only by 2012. The European Centre for the Validation
of Alternative Methods (ECVAM) of the Commission's Joint Research Centre (JRC) has prepared an
inventory of alternative testing methods. It is provided for publication in June 2002 and shows the
current status of alternative tests for human health effects required by EU chemicals legislation (but
not for the environmental effects!). It also gives recommendations for further development and
validation of alternative tests and strategies.The Commission will continue to encourage the development of alternative methods. Under the
current 5th Framework Programme for Research and Technological Development (1998 - 2002) the
Commission is supporting more than 29 research projects aiming at the development of in vitro
alternatives. This represents a Community contribution of about 35 million Euro. Under the sixth
multi-annual Framework Programme, which is now under preparation, the Commission will continue
to stimulate the refinement, reduction and replacement (3 Rs) of animal testing methods. It is
important to note that every year about 10 million la boratory animals are used in the EU for research
and scientific purposes.
(c): Eventual ban on imports: See answer to question 42.
(d),(e): Arbitrary discrimination, Precautionary Principle: See answer to question 44.(g): Access to confidential information
The White Paper proposes to protect confidential information, including by appropriate property
rights for test data. Public availability is only proposed for non-confidential information.
(h): Possible difficulties for developing countries
The White Paper considers that “Developing countries are mostly importers and not exporters ofchemicals. The testing requirements in the EU will ensure that imported chemicals, which constitute
the large majority of chemicals used in these countries, have been evaluated. This benefit will by far
outweigh the potential economic effort, such as for testing, required by chemical companies located in
developing countries when manufacturing chemicals for export to the EU."
Nevertheless it may be considered that the new chemicals system may require capacity building inDeveloping Countries. Provisions for capacity building in the area of chemicals are included in
international conventions, such as the PIC (= Ro tterdam Convention on Prio r Informed Consent for
Certain Hazardous Chemicals and Pesticides in International Trade) or the POPs Convention (=
Stockholm Convention on Persistent Organic Pollutants). Capacity building appears to be dealt with
under the EU development policy rather than under a specific legislation such as the future EU
chemicals legislation which we are developing.WT/TPR/M/102/Add.2
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Food
Question from Switzerland:
With respect to the Commission system for rapid e xchange of information among Member States in
the event of a serious and immediate risk to health and safety of consumers from foodstuffs, which is
referred to in paragraph 48, Switzerland believes that  this is an important step towards food safety
cooperation across national boarders. Taking into account the significant trade in food and foodproducts between EU and Switzerland, the Swiss authori ties would be highly interested to take part in
this information exchange. Are there any provisions that would allow third countries to participate in
the information exchange?
A: Yes. Regulation (EC) No 178/2002 of the Europ ean Parliament and of the Council of 28 January
2002 laying down the general principles and requirements of food law, establishing the European
Food Safety Authority and laying down procedures in matters of food safety provides for the
possibility for third countries to, participate in Rapid Alert System for Food and Feed. Article 50
paragraph 6 of this Regulation foresees "Participation in the rapid alert system may be opened up to
applicant countries, third countries or international organisation, on the basis of agreements betweenthe Community and those countries or international organisations, in accordance with the procedures
defined in those agreements. The latter shall be based on reciprocity and shall include confidentiality
measures equivalent to those applicable in the Community."
An official request for participation has to be addressed to Mr. R. Coleman, Director General of the
Health and Consumer Protection Director ate General of the European Commission.
Questions from Canada:
Paragraph 30 (summary observations) states that a new European Food Safety Authority (EFSA) was
also established to provide scientific advice to the Commission on food policy matters, as well as to
Member States should they so request. A number of Member States have established authorities with
mandates at national level to ensure independent scientific advice. New regulatory requirements have
also been put into place with respect to labelling of food products of all origins to ensure traceability.
We understand that links to Member State food agencies will be maintained through an Advisory
Forum composed of one representative from each member states’ competent authority and that it will
not have a policy-making role. Please share how th e EU intends to deal with situations where
national food safety agencies (e.g., France failing to lift its ban on UK beef) hold opposing views with
the EFSA and act upon it.
A: The Advisory Forum consists of representatives from the competent bodies in the Member States
which perform functions similar to those of the Authority.
The Forum should provide the main tool for the E FSA to develop close collaboration between the
competent bodies in the Member States and the Authority.It will reinforce the scientific consensus between the community level and the MS levels.
EFSA will be able to ensure that available information on food risks is collected, analysed and made
commonly available. Scientific expertise of Member States at Community level will be mobilised and
centralised far more efficiently, and differences in scientific appreciation minimised, if not eliminated.
These networking mechanisms will certainly facilitate early agreement on the most rational, sciencebased risk management measures to be taken at Community level.
However, if despite these preventive mechanisms, there is a case of divergent scientific opinions
between EFSA and a national competent authority, a specific mechanism is provided in Article 30 of
the Regulation establishing EFSA.
Paragraph 4 of Article 30 states : « Where a substantive divergence over scientific issues has been
identified and the body in question is a Member State body, the Authority and the national body shall
be obliged to co-operate with a view to either resolving the divergence or preparing a joint documentWT/TPR/M/102/Add.2
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clarifying the contentious scientific issues and iden tifying the relevant uncertainties in the data. This
document shall be made public ».In addition and according to Article 27 (4), in those specific circumstances "the Advisory Forum shall
ensure close co-operation between the Authority and the competent bodies in the Member States ".
The above procedure provides for an examination of the reasons for the different views. In some cases
this may lead to a convergence. However the risk managers ultimately have to decide what they do
with the divergent scientific opinions. It is the responsibility of the risk manager (democraticinstitutions) to decide what action to take when faced with divergent scientific opinion not the EFSA.
This is the legal process and legal infringement procedures are provided for in this framework. (as
was the case in the French/UK BSE matter).
In relation to paragraph 49, one area of reported controversy concerns the placement on the EU
market of genetically modified organisms (GMO s) and products that may contain GMOs or GMO
derivatives. Although the new legislative framewor k for authorizations is tighter in a number of
respects, certain Member States remain opposed to placement on the market without comprehensive
labelling requirements on traceability, currently under consideration.
The Members States have blocked the EU approval process for GMOs since March 1998.
This has adversely affected Canadian exports as GMOs must be approved before they are
commercialized. What is the EU’s rationale for failing to provide a scientifically sound approval
process for GMOs, particularly as there is no evidence that GMOs approved under an internationally
recognized approach, such as those developed by the OECD and FAO/WHO, are any less safe than
their conventional counterparts?
Canada recognizes that the EC has proposed COM (2001) 182, the Proposal for a Regulation of the
European Parliament and of the Council concerning traceability and labelling of genetically modifiedorganisms and traceability of food and feed products produced from genetically modified organisms,
and COM (2001) 425, the Proposal for a Regulation of the European Parliament and of the Council
on genetically modified food and feed, to restart the approval process. However, in our official
comments to the EU, we indicated our concerns that these proposals are discriminatory, very costly,
unworkable, and unenforceable. Please explain how the EU can justify the rationale for theseproposed regulations, on the basis of science, feasib ility, and its WTO obligation to select the least
trade restrictive alternative.
A: The EU regulatory system for the placing on the market of GM products is founded on a
comprehensive scientific pre-market risk assessment. The procedure involves all Member States andwhere they raise objections, the relevant Scientific Committees are consulted for opinion. In light of a
favourable decision, Member States are required to vote and at this stage, a qualified majority must be
obtained if the product is to be placed on the market. Since April 1998, certain Member States have
become increasingly reluctant to vote in favour of new approvals. This reluctance does not, however,
reflect a failure to provide a scientifically sound approval process but the political positions withinMember States.
The proposed Regulations will lay down a general, horizontal framework for regulating genetically
modified food and feed, including a centralised aut horisation procedure and labelling provisions and a
general, horizontal framework for traceability and labelling of genetically modified organisms and
traceability of genetically modified food and feed.The European Commission believes that the proposed requirements will enhance transparency and
facilitate the implementation of measures, where appropriate, to ensure safety throughout the food and
feed chain, contributing also to restore users and consumers confidence in the application of gene
technology in the agro-food sector.
It should be clarified that the facilitation of accurate labelling is generally not linked to safety, but
provides an improvement in the fairness and transpar ency of transactions. It will thereby facilitate theWT/TPR/M/102/Add.2
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task of operators who must comply with regulatory  or commercial requirements on the part of their
customers, such as labelling of the final product.The European Commission would also like to point out that it remains illegal to import GMOs or
genetically modified food into the European Union that have not received authorisation in accordance
with current European Community law. Operators are, therefore, already obliged to ensure that
unauthorised GMOs or genetically modified foods are not imported into the European Community.
The European Commission has given detailed reasoning why it is of the opinion that the proposedlegislation is neither discriminatory, very costly, unworkable, and unenforceable in its response to
comments submitted by WTO members under eith er G/TBT/N/EEC/7 and/ or G/SPS/N/EEC/150 and
G/TBT/N/EEC/6 and/or G/SPS/N/EEC/149.
This has already been communicated to Canada on 17 July 2002.
Question from Taiwan:
EU’s new legislation employs a more restrictive procedure, which is to be time-bound, and requires
mandatory labeling. Are there any risk assessment procedures undertaken before adopting these
measures? Is the assessment conducted by a quantitative method? Are there any scientific evidence of
supporting mandatory labeling and other relevant regulatory measures? In addition, some EUmember states opposed the newly introduced measur e, thus delaying the empl oyment of traceability
on labels. What action will the EU take with to  reduce the difference among Member States? How
does the EU verify the content of labeled GMOs? How will the EU tackle the situation where traders
do not label GMOs as mandated or label products with incorrect information? What measures will be
taken against imported GMOs to be placed in the EU market?
A: EU legislation on GMOs has been in place since the early 1990s and throughout the decade, this
regulatory framework has been further extended and refined, notably by the introduction of sector-
specific legislation. This legislation has been de signed to protect its citizens' health and the
environment while simultaneously creating a unified market for biotechnology.
Directive 90/220/EEC on the deliberate release of genetically modified organisms, covers the placing
on the market for GMOs and includes use as seed, animal feed and import and processing. Use ofGMOs in food has since May 1997 also required compliance with the Regulation on Novel Foods and
Novel Food Ingredients of 27 January 1997 (Regulation (EC) 258/97).
Directive 2001/18/EC, which replaces Directive 90/220/EEC on 17 October 2002, includes the
authorisation procedure for placing products on the market. This procedure is founded on a
comprehensive pre-market risk assessment, the principles for which are strenghened under the revisedDirective. This Directive also provides for time-lim its for the sections of the authorisation procedure
and increases transparency via public consultation. Post-market control measures may be put in place
dependent upon the conclusions of the risk assessment.
The European Commission would like to point out that it remains illegal to import GMOs or
genetically modified food into the European Union that have not received authorisation in accordancewith current European Community law. Operators are, therefore, already obliged to ensure that
unauthorised GMOs or genetically modified foods are not imported into the European Community.
The proposed Regulation on GM food and feed differs from the current regulatory framework
applicable to genetically modified food and feed mainly in the following respects.
• A centralised Community procedure would be established for the authorisation of GM food
(under the current system the authorisation procedure is only partly centralised). A single
scientific evaluation would be undertaken by the European Food Safety Authority (under the
current system the scientific evaluation is originally carried out by one Member State competent
body and may have to be complemented by the relevant Scientific Committee(s) established at
Community level) followed by a single authorisation decision by the Community
• The same centralised authorisation procedure would be applied to GM feed.WT/TPR/M/102/Add.2
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• A 10 years data exclusivity would be granted for some of the information submitted in
support of applications.
• Detailed requirements woul be introduced in respect of the particulars and documents to be
supplied in support of applications (in particular  lodging of reference material and methods for
detection and identification);
• New transparency provisions, modelled on t hose laid down in Directive 2001/18/EC, would
allow for public consultation after publication of the opinion of the European Food Authority.
• A threshold (maximum 1%) would be introd uced for the adventitious or technically
unavoidable presence of unapproved GM material in food and feed which have at least received apositive evaluation by the relevant scientific committee of the European Community (this was not
foreseen in Regulation (EC) No 258/97 on novel foods).
• New labelling requirements would enable consumers to make informed choices and avoid
also deceptive practices.
• The proposal extends the current labelling provisions to all genetically modified food
irrespective of the detectability of DNA or protein. Food that consists of, contains or is produced
from GMOs would have to be labelled as such. Thus all products, which are subject to
authorisation under the proposed Regulation, would henceforth also be subject to mandatory
labelling
• The proposal for a Regulation concerning traceability (notified under G/TBT/N/EEC/7 and
G/SPS/N/EEC/150) would ensure that information concerning whether a food or a feed isconsisting of, containing or produced from a GMO is available at all stages of the placing on  the
market and should thereby facilitate accurate labelling of the final product and provide the means
for inspection and control of labelling claims.
• Already under current European Community law genetically modified foods have to be
labelled even in cases where there are no specific handling, usage, safety, or compositional
distinctions. The objective is to inform the consumer about the fact that the food or food
ingredient is genetically modified.
• The European Commission is aware that European consumers are demanding clear labelling
whether food contain or are produced from a GMO(s) in order to make an individual choice. TheEuropean Commission believes that providing accurate information by labelling all food or food
ingredients containing or produced from GMOs will foster confidence in the regulatory systemand social acceptance of the application of biotechnology in agri-food production, and ultimately
facilitates trade in such products.
Questions from Australia:
The Secretariat reports in paragraph 48, page 40, that scientific evidence is to underpin EU food
safety policy with the precautionary principle to be used where appropriate. Can the EU provide
some examples of such appropriate use?
A: The best classical example of the application of the precautionary principle is the decisions taken
by the Community as regard Bovine Spongiform Encephalopathy. These decisions have been adoptedand implemented without waiting for complete scientif ic information in order to protect the health of
consumers. It should be noted that many countries prohibited imports of bovine products from the EC
without full scientific justification A second example is the Council Regulation banning the use of
four antibiotics as additives in animal feeding stuff. This Regulation have been challenged. The
European Court of Justice concludes that, despite uncertainty as to whether there is a link between the
use of those antibiotics as additives and the development of resistance to them in humans, the ban of
the products is not a disproportionate measure by comparison with the objective pursued, namely theprotection of human health.WT/TPR/M/102/Add.2
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How will EFSA interact with Member State agencies?
A: The EFSA will develop close working links with  the national food administrations and where they
exist with national food agencies across the European Community. It will work through the principles
of partnership and collaboration and form networks of scientific and technical organisations. The
EFSA will work closely with the heads of national agencies or their scientific directors to build such
collaboration and sharing of scientific data and information. The Advisory Forum which is one of thecomponents of the EFSA will be instrumental in building this collaboration.
How will overall duplication be avoided?A: The EFSA is not there to prevent scientists in the different member states from work in the same
field indeed this should be encouraged However, the EFSA networking system should help to avoid
unnecessary duplication since an efficient sharin g of information between EFSA and the Member
states will be in place..
How will disagreements be dealt with, should they arise?
A: Scientific debate and differences in opinion are part of the normal scientific process. However the
EFSA networking mechanisms will ensure that available information on food risks is collected,
analysed and made commonly available. The sharing of information and networking will certainly
minimise differences in scientific appreciation.
If however disagreement arise on scientific matter which are causing serious concern the EFSA has a
mechanism to bring together the different scientists and explore the reasons for the different views.
Sometimes this may be due to different data or interpretation of the same data and discussion cansometimes lead to a shared understanding. If however the scientists do not come to a common
understanding and there is still room for disagreemen t, the EFSA will issue a report explaining the
disagreement, the source of this and if further work is needed to come to an agreed conclusion. One of
the mission of the Advisory Forum will be to facilitate this kind of co-operation. but the EFSA will
not be the arbiter of scientific views.
How will separation of risk assessment and risk management functions between EFSA and the
Commission and Parliament lead to sound science ba sed decision-making and not to a diminution of
the science?
A: On the contrary the EFSA will be integral to the development of scientific data and opinions on
which the European Food law will be based. Regulation 178/2002/EC laying down the general
principles of food law establishes the principle that European Food law will follow risk analysis
principles, and in particular will be based on the scientific risk assessments and opinions expressed by
the European Food Safety Authority. One of the reasons for establishing the EFSA is to ensure thatthere can be substantial emphasis given to scientific debate and that opinions can be developed by an
independent organisation which is not influenced by political or other subjective elements. The risk
managers will then need to consider their actions in the light of the independent scientific advice.
We note that the Scientific Committee of the European Commission reported in 2001 that there was
no scientific evidence of GMO food and feed posing any greater risk to human health than their
conventional counterparts. In the absence of an id entifiable risk to human health, how does the EU’s
proposed “traceability” system meet SPS requirements?
A: Regulation (EC) No 178/2002 (O.J. No. L 31/1  of 1 February 2002) laying down the general
principles and requirements of food law (General Food Law), establishing the European Food Safety
Authority and laying down procedures in matters of food safety provides in terms of traceability thatWT/TPR/M/102/Add.2
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all food and feed business operators must have systems in place to identify from whom they have
received a food or feed and to whom they have sold a food or feed (one step back and one stepforward).
This is due to the fact that experience has shown that the functioning of the market in food and feed
can be jeopardised where it is impossible to trace food and feed. The European Community therefore
deems it necessary to establish a comprehensive system of traceability of all food and feed within
food and feed businesses so that targeted and accurate withdrawals can be undertaken or informationgiven to consumers or control officials, thereby avoiding the potential for unnecessary wider
disruption in the event of food safety problems.
However, traceability provisions in current European Community law governing food and feed and in
the General Food Law do not specifically address traceability of products produced from GMOs.
The concept of traceability specifically for GMOs was introduced into European Community law forthe first time in Directive 2001/18/EC (O.J. No L 106/1 of 17 April 2002) on the deliberate release of
GMOs into the environment in so far as Article 4(6) requires that Member States shall ensure
traceability at all stages of the placing on the market of GMOs.
The retro-active tracking of the movement of GMOs and food and feed produced from GMOs through
the production and distribution chains will be facilitated by traceability requirements based ontransmission and retention of relevant information for such products, at all stages of their placing on
the market. Such a traceability "system" facilitates
- withdrawal of products should an unforeseen risk to human health, animal health or the
environment be established;
- monitoring of potential environmental effects;
- accurate labelling, including control and verification of labelling claims.
The objectives for traceability of GMOs and products produced from GMOs are not identical andtherefore the specified information to be transm itted and retained differs for each. This Proposal
provides for the traceability of individual GMOs within a product on the basis of authorised
transformation events.
Traceability to facilitate withdrawals and environmental monitoring of GMOs will, therefore, require
that the specific identity of a GMO and its associated traits and characteristics can be established.It is essential that the specific identity of GMOs  that are to be intentionally introduced into the
environment for cultivation can be established. This is because these products contain ‘viable’ GMOs
that are capable of reproduction and dissemination. In this context, the Proposal requires that
operators have to specify exactly the identity of the GMOs contained in the products and transmit this
information to the operator receiving the product. Specific identity is provided for by use of uniquecodes assigned to individual GMOs.
Transmission and retention of information that a food or feed is produced from GMOs throughout the
production and distribution chain would facilitate labelling of the final product for operators under the
current European Community food labelling scheme. It would also provide the means for inspection
and control of compliance with current labelling provisions for GM foods and reduce reliance ondetection methodology.
It should be clarified that the facilitation of accurate labelling is generally not linked to safety, but
provides an improvement in the fairness and transpar ency of transactions. It will thereby facilitate the
task of operators who must comply with regulatory  or commercial requirements on the part of their
customers, such as labelling of the final product.The European Commission believes that the proposed requirements will enhance transparency and
facilitate the implementation of measures, where appropriate, to ensure safety throughout the food and
feed chain, contributing also to restore users and consumers confidence in the application of gene
technology in the agro-food sector.
Has the EU conducted a science-based risk assessment or based its measure on an international
standard? If so, can the EU provide us with a copy?WT/TPR/M/102/Add.2
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A: The information requirements for the identificat ion of individual GMOs closely align with those
provided for under the Cartagena Biosafety Protocol with regard to transboundary movements. TheEuropean Commission considers that this is of significant importance if a harmonised and consistent
approach is to be achieved for trade with third countries, particularly where bulk shipments are
concerned.
The objectives of the Proposal in respect to GMOs for direct use in food, feed or processing and food
and feed products produced from GMOs, notably facilitating withdrawals and accurate labelling offood are currently discussed in several committees of Codex Alimentarius. The committees concerned
are the Codex General Committee, the Codex Comm ittee on Food Import and Export Inspection and
Certification Systems and the Codex Committee on Food Labelling.
Can the EU provide a scientific or other explan ation behind its proposal to discriminate between
foods produced from GMOs (including highly refined oils and sugars that have no traces of modified
DNA or protein) and foods produced with GM en zymes (eg enzyme processing aids used in the
production of many cheeses and wines)? If not, this suggests the measure is not based on a concern
about human health.
A: Enzymes, as such, are not excluded from the scope of the provisions of the Proposal.
Enzymes are used in food production either as addi tives, or as processing aids. Additives, including
enzymes used as food additives, are food ingredients, i.e. food under European Community law and
therefore subject to the provisions of the Proposal. Processing aids (i.e. materials used during
processing but not present in the finished product), including enzymes used as processing aids, are not
food ingredients, i.e. they are not food under European Community law; they are therefore not  subject
to the provisions of the Proposal.The European Commission would like to stress that the Proposal is not, in this respect, in any way
different from the current legal situation as it results from the application of Regulation (EC) No
258/97, which has never let to any concern in this respect. However, the European Commission has
already announced to the European Parliament that it is considering bringing forward new legislation
on enzymes.
At the first reading of the GM proposals in late June 2002, the European Parliament insisted that
each GMO present in a commodity shipment must be named specifically with a unique code, rather
than being able to list the GMOs that the shipment “may contain” where the product is destined for
use as food, feed or processing. This debate is similar to the position being pursued by the EU in theBiosafety Protocol negotiations in respect of commodity shipments. Noting that the EU advised the
European Parliament on 3 July 2002 that these requirements “will put significant obstacles in the
way of the practical implementation of the legisl ation and hamper international trade”, can the EU
explain how these requirements will be implemented in a manner consistent with WTO rules?
A: In terms of the information to be transmitted to ensure, traceability, it is important to recognise that
the objectives of traceability for GMOs are not identical to those for products produced from GMOs.
It is essential that the specific identity of GMOs to be intentionally introduced into the environment
for cultivation can be established. This is because these products contain ‘live’ GMOs that are capable
of reproduction and dissemination. Therefore the Proposal requires that operators specify exactly theidentity of the GMOs contained in the products.
Conversely, the potential risk to the environment from products containing GMOs for direct use in
food, feed or processing will be limited as they are not intended for cultivation. The Commission,
therefore, considers it both appropriate and adequate that products, including bulk shipments,
containing GMOs for food, feed and processing are accompanied by documentation stating this use,
with a list of unique codes for the GMOs that the product or shipment may contain. The CommissionWT/TPR/M/102/Add.2
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Proposal reflects this requirement via a specific derogation for such GMOs and the Commission
considers that it is consistent with the provisions of the Biosafety Protocol.The Parliament adopted, at its first reading, amendments that removed the derogation and also
introduced the requirement for unique codes to be transmitted for the GMOs from which products are
produced. The Commission rejected acceptance of these amendments in the debate prior to the
plenary vote in Parliament on 3 July 2002.
When does the Commission intend to respond to co mments made by Member governments to its SPS
and TBT notifications?
A: The response has been transmitted mid-July.
Can the EU provide an estimate of  the costs involved in developing, maintaining and enforcing the
proposed system?
A: In the explanatory memorandum to the Proposal the European Commission stated that it is difficult
to estimate the costs of introducing traceability specifically for GMOs and products produced fromGMOs. This view is shared by the United States Department of Agriculture (USDA) who in a recent
article stated that "estimating the magnitude of the costs of identity preservation, tracing, and labelling
is complex and subject to varying assumptions " (see Agricultural Outlook/January-February 2002).
The European Commission considers that the transmission and retention of information can largely be
incorporated into existing (documentary) systems for transactions and as such should not imply
significant extra costs for operators and consumers. Information with respect to the supplier,
customer, price, and transaction date as well as the nature, source, contents and amount of the productalready accompanies the majority of transactions.
For operators supplying food derived from GMOs to the market, traceability only implies that
operators must inform the next operator in the chai n that the food, feed or food/feed ingredient is
derived from GMOs and retain that document. This is neither particularly burdensome nor costly and
it does not entail segregation.Aggregated costs, if any, will be passed on to the consumer and the labelling of GM foods ensures
that consumer demands will ultimately drive the market in the direction of their preferences also
taking into account the price of the food.
Traceability and systematic labelling will promote transparency in the market place and the freedom
of choice for consumers, as well as, leaving it to th e market forces to decide the fate of the different
products.
The Proposal foresees that transmission and retention of information as a means to facilitate
traceability will even limit the need for sampling and testing of products to confirm their identity at
every stage of the placing on the market. This would result in a reduction in the costs for companies to
meet the current labelling criteria in European Community law particularly for retailers.
Has the EU considered alternative, less trade restrictive mechanisms?A: The Commission has discussed various options  with EU Member States and stakeholders
(discussion paper available onhttp://europa.eu.int/comm/food/fs/gmo/gmo_index_en.html) .
The proposed approach was chosen for the following reasons:
- A non-harmonised approach resulting in the establishment of different traceability
requirements in Member States may hinder the free movement of products, creating
conditions of unequal and unfair competition. The costs of such an approach are difficult to
estimate but would most likely result in much higher costs for all operators.WT/TPR/M/102/Add.2
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- The Proposal foresees that transmission and retention of information as a means to facilitate
traceability will limit the need for sampling and test ing of products to confirm their identity at
every stage of the placing on the market. Current experience with detection methods
demonstrates that testing raw ingredients is mu ch more simple and cost-effective than testing
the final products on the supermarket shelves.
- Weighing the potential costs of traceability against the potential costs of no traceability
system it was concluded that the establishment of effective traceability requirements couldprevent excessive economic losses or brand damage in case an unforeseen risk to human
health or the environment arises.The recent case in the United States, where a genetically
modified maize variety approved only for use in animal feed entered the food chain and the
subsequent need for urgent recall of products from the market, has clearly demonstrated the
usefulness of a traceability system.
Although voluntary traceability systems can also be useful, mandatory ones are more likely to be
followed in a consistent way by all operators in the production and distribution chain, which can also
be instrumental in helping prevent such problems ar ising in the first place, thereby avoiding potential
huge costs for the companies involved and for public authorities.
How does the EU intend to address the important practica l issues of inability to detect traces of novel
DNA and/or protein in highly refined foods, opening the way for fraud and difficulties in enforcing
compliance, in implementing its measure?
A: The European Commission would certainly acknowledge that enforcement of traceability
provisions is more difficult when it is not possible to verify the truthfulness of claims through
analytical methods.Control based on paper documentation is not new, but has existed for many years. For instance Article
4.5 of the Codex Standard for Food Labelling provides that the country of origin of the food shall be
declared if its omission would mislead or deceive the consumer. Country of origin labelling claims
can in most cases not be verified through analytical methods, but is verified through paper-based
traceability.According to a paper (CX/FICS 02/2 of January 2002) prepared by the Australian Secretariat of the
Codex Committee on Food Import ad Export Inspection and certification systems "the application of
traceability " to ensure fair practices in the food trade" is probably most directly linked to the first of
the General Principles set down in the General Sta ndard for Labelling of Pre-packaged Foods which
reads: "Pre-packaged food shall not be described or presented on any label or in any labelling in amanner that is false, misleading or is likely to create an erroneous impression regarding its character
in any respect". This application is also expressed in the Guidelines for the Production, Processing,
Labelling and Marketing of Organically Produced Foods, the aims of which include "to protect
consumers against deception and fraud in the market place and unsubstantiated product claims".
In other words paper-based traceability can be and is applied to ensure fair practices in the food trade,to provide relevant information and to protect consumers against deception and fraud.
For instance, origin labelling and dolphin safe tuna labelling are implemented and controlled on the
basis of paper-based traceability.
All legislation can potentially lead to fraudulent practices, however fraudulent practices do not
necessarily lead to distrust in regulatory regi mes, but rather in the operators who commit fraud.
How do the proposed regulations contained in Notification G/SPS/N/EEC/149 take account of the
requirements of the Biosafety Protocol “as re gards importer obligations and notification”?
A: The proposed Regulation has taken into account Article 11.4 of the Biosafety Protocol which
determines that “a Party may take a decision on the import of living modified organisms intended forWT/TPR/M/102/Add.2
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direct use as food or feed or processing under its domestic regulatory framework that is consistent
with the objective of this Protocol".As regards labelling, the Biosafety Protocol covers the issue of advanced information agreement
between parties to protect biological diversity, but does not address labelling of products containing or
produced from GMOs or LMOs for the purpose of information the consumer or facilitating consumer
choice.
Australia notes that the Commission's Trade Directorate took a case to the European Court of Justice
in 2001 concerning shared competence of the Biosafety Protocol, because of concerns that EU
Member States may use the Protocol against the tr ade interests of the EU and the WTO. That case
was lost by the Trade Directorate. The EU announced its ratification of the Biosafety Protocol in June
2002, and Member States are in the process of ratifyi ng. Can the EU assure Australia that the EU and
its Member States will implement the Protocol in a way that is consistent with WTO rules, including
the need to base import decisions on scientific risk analyses?
A: The Commission recently adopted a Proposal to  implement the provisions of the Biosafety
Protocol into Community law. This Proposal aims to ensure a harmonised approach toimplementation in the European Union and consistency with WTO rules were taken into account
during its drafting. The Proposal is currently under discussion in the European Parliament and with
the Member States.
Questions from Costa Rica:
(i) ¿Cuáles son los alcances del principio de precaución en caso oportuno que se
menciona en el párrafo 48? ¿Se aplica sólo en materia de seguridadalimentaria? (párrafo 48).
A: In the Community’s view, the precautionary principle is an internationally recognised principle of
international law, which is also embodied in the jurisprudence of the WTO’s Disputes Settlement
Body. This principle is also listed in the EC Treaty as one of the guiding principles of Community
Environmental Policy.On 2 February 2000, the Commission adopted a Communication on the use of the precautionary
principle. In this Communication the Commission identified the situations in which measures
pursuant to the precautionary principle should be taken. These situations are when scientific evidence
is insufficient, inconclusive or uncertain and preliminary scientific evaluation indicates that there are
reasonable grounds of concerns with regard to environment, human, animal or plant health.
¿Cuál es la legislación aplicable para la colocación de OMG? Incluye requisitos de rastreabilidad?
¿Para qué productos se exigen requisitos de rastreabilidad? (párrafo 49)
A: Directive 90/220/EEC on the deliberate release of genetically modified organisms, covers the
placing on the market for GMOs and includes use as seed, animal feed and import and processing.
Use of GMOs in food has since May 1997 also required compliance with the Novel Foods Regulation.
The placing on the market of products under Directive 90/220/EEC follows a step-by-step
authorisation procedure and a case by case assessment of the risks to human health and the
environment. Autorisation is only granted where there is no reason to believe that a productconstitutes a risk to human health or the environment. Directive 90/220/EEC has recently been revised
and will be replaced by Directive 2001/18/EC on 17 October 2002. The new Directive strengthens the
principles for risk assessment and also includes mandatory requirements for post-market monitoring
as well as labelling and traceability of products at all stages of their placing on the market.
Products derived from GMOs, such as paste or ketchup from a GMO tomato are not covered by the
scope of Directive 90/220/EEC (or Directive 2001/18/E C) but by vertical, sectoral legislation, forWT/TPR/M/102/Add.2
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example the Regulation on Novel Foods and Novel Food Ingredients of 27 January 1997(Regulation
(EC) 258/97). Directive 90/219/EEC as amended by  Council Directive 98/81/EC on the contained use
of GMMs regulates the contained use of GMMs for research and industrial purposes.
Community legislation on GMOs has been in place since the early 1990s and throughout the decade,
this regulatory framework has been further extended and refined, notably by the introduction of
sector-specific legislation. This legislation has been designed to protect its citizens' health and the
environment while simultaneously creating a unified market for biotechnology. More information onthe EU legislation and its underlying principles can be found on
http://europa.eu.int/comm/food/fs/gmo/gmo_index_en.html.
The general traceability requirements in Regulation (EC) 178/2002 provides that food and feed
business operators have to have systems in place to identify from whom they have received a food or
a feed (one step back) and to whom they have sold a food or a feed (one step forward).The traceabilityrequirements include food, feed, food-producing animals, and any other substance intended to be, or
expected to be, incorporated into a food or feed, at all stages of production, processsing and
distribution. The objective is to establish a comprehensive system of traceability within food and feed
businesses so that targeted and accurate withdrawals can be undertaken or information given to
consumers or control officials. The European Commission considers that any given piece ofinformation can serve a number of purposes and objectives.
Directive 2001/18/EC introduces a requirement that Member States should ensure traceability at all
stages of the placing on the market of products. In order to ensure a harmonised approach for
traceability, the Commission brought forward a legislative proposal for specific traceabilty
requirements for GMOs which is currently being discussed in the European Parliament and with EU
Member States. The scope of this Proposal was ex tended to include food and feed products produced
from GMOs in order that traceability be applied throughout the production and distribution chains.For further information see:
http://europa.eu.int/comm/food/fs/gmo/gmo_index_en.html.
Question from Mexico:
En el párrafo 48 del capítulo III del IS se indica  que toda la legislación alimentaria de la UE será
revisada para el 1º de enero de 2007. ¿Puede la UE  confirmar si dicha legislación será sometida a
consulta pública y notificada al Secretariado de la OMC para observaciones de los miembros?
A: The Regulation (EC) No 178/2002 of the European  parliament and of the Council of 28 January
2002 laying down the general principles and requirements of food law, establishing the EuropeanFood Safety Authority and laying down procedures in matters of food safety provides that the general
principles of food law as established by the Regulation shall form a general framework of a horizontal
nature to be followed when new measures are taken. It is furthermore foreseen that existing food law
principles and procedures shall be adapted as soon as possible and by 1 january 2007 at the latest in
order to comply with these general principles  of Food Law. The European Community will in
accordance with the provisions of the WTO agreement on the Apllication of Sanitary and
Phytosanitary Measures (SPS Agreement) and/or the WTO Agreement on Technical Barriers to Trade
(TBT Agreement) notify changes in their sanitary or phytosanitary measures and technical
regulations. However, since the general principles have already been notified to WTO
(G/SPS/N/EEC/110 of 8 February 2001 with an extended deadline of 26 May 2001), the notificationof texts including these already notified general principles should not be a problem.
Question from Brazil:
Does the EU have any policy of mutual recogniti on of laboratories in the field of biotechnology?
A: The proposed Regulation (notified under G/ TBT/N/EEC/6 and G/SPS/N/EEC/149) does provide
for available, accessible and standardized methods. Indeed, under the proposed Regulation, no GMWT/TPR/M/102/Add.2
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food or feed will be placed on the market in the European Union without a valid authorization first
being granted by the Community and no authorization will be granted by the Community unless amethod for detection, including sampling and identification of the transformation event has been
tested and validated by the Community reference laboratory. As indicated, these methods will form
part of the authorizations granted and will be made available in the Register.
Implementation of the Regulation, monitoring and control will be the responsibility of Member States
and their control authorities. Monitoring and control will be carried out on Community territory andtherefore there was no need for the Proposal to fo resee provisions for collaboration with foreign
authorities/laboratories. This does not exclude technical collaboration between the European
Community and foreign laboratories. The European Community has been soliciting co-operation with
other countries on the development of reliable detection and identification methods.
Questions from Thailand:
After the adoption by the EU of the new framework for food law in 2002, which is to be used by
Member States by 1 January 2005. We believe that there may be cases where certain Member States
adopt requirements and standards that are more st ringent than those established by the Commission.
In view of these varying safety standards adopted by individual Member States across the Community,this may generally cause confusion to the trade and affect trading partners’ market access to the EU.
Trade flows may be disrupted and free movement of goods across national boundaries impeded.
In this regard, we would like to hear the EU’s comments on two aspects:
(a) Has the lack of uniform safety standards, especially in cases where those adopted by some
Members are more stringent than others’, ever created a barrier to intra-EU trade?;
(b) As the varying safety standards across Member States may impose, in some instances,
excessively onerous compliance obligations on business operators in developing countries, does theEU envisage any possible agreement to adopt minimum common standards that have been approved
by the Commission?
The Report notes that "scientific evidence is to underpin food safety policy, with the
precautionary principle to be used where appropriate. We would like to hear the EU’s view on how it
sees the application of the precautionary principle to trade in agriculture without creating excessivelytrade-restrictive barriers or failing to be in compliance with basic trade principles.
Should there be differences in opinion on scientific evidence on food safety issues between
EFSA and Member State food safety authorities or agencies (e.g. AFSA in France), please give
clarification as to, in case of such disagreement, whose ruling is to be upheld.
A: EFSA will be able to ensure that available information on food risks is collected, analysed and
made commonly available. Scientific expertise of Member States at Community level will be
mobilised and centralised far more efficiently, and differences in scientific appreciation minimised, if
not eliminated.
However, if despite these preventive mechanisms, there is a case of divergent scientific opinionsbetween EFSA and a national competent authority, a specific mechanism is provided in Article 30 of
the Regulation establishing EFSA.
Paragraph 4 of Article 30 states: «Where a substantive divergence over scientific issues has been
identified and the body in question is a Member State body, the Authority and the national body shall
be obliged to co-operate with a view to either resolving the divergence or preparing a joint document
clarifying the contentious scientific issues and iden tifying the relevant uncertainties in the data. This
document shall be made public».
The above procedure provides for an examination of the reasons for the different views. In some cases
this may lead to a convergence. However the risk managers ultimately have to decide what they do
with the divergent scientific opinions. It is the responsibility of the risk manager (democratic
institutions) to decide what action to take when faced with divergent scientific opinion not the EFSA.WT/TPR/M/102/Add.2
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This is the legal process and legal infringement procedures are provided for in this framework. (as
was the case in the French/UK BSE matter).
Industrial Products
Questions from Taiwan:
The Report states that the simplification and enhanced scope are being proposed for a new machinery
directive. What is the schedule of adoption for this  proposed new machinery directive? When will it be
notified in accordance with the TBT Agreement?
A: Difficult to be precise with schedule for the adoption of this directive. Common Position not
expected before late 2003. Scedule beyond that difficult to predict. The directive also will have a
transitional period before entry into force.
What are the differences between the proposed new machinery directive and the existing Council
Directive 98/37/EC?
A: The proposed directive aims to improve legal clarity to avoid overlaps with other directives, and to
correct shortcomings perceived in the existing directive.
Question from India:
France does not allow import of completely assembled bicycles. Bicycles can only be imported in
CKD/SKD condition and assembled in France. This pr ovision has, however, not been applied to other
EU countries that supply bicycles to France and is, therefore, a discriminatory non-tariff barrier.
France can have safety regulations for bicycles; however, it cannot impose a requirement that they beassembled in France only. This requirement is a violation of MFN obligation when such a
requirement is not insisted upon other European countries. When does France intend to discontinue
this discriminatory regulation?
A: The question seems to refer to a requirement which concerns bicycles and the way they are sold to
the ultimate consumer, i.e. in fully assembled form . The requirement is certainly not in violation of
GATT Article III on National Treatment and Internal Regulation as it applies to any bicycle
regardless of its origin. Importers are allowed to import unassembled, disassembled or partially
assembled (CKD/SKD) bicycles, which need to be assembled before they are put into sale for the
final consumer -just like any other bicycle originating in the EU. The French regulation, furthermore,does not require that the bicycles be assembled in France, as they can be assembled anywhere else. Of
course they will only be put onto the market if they satisfy French safety standards, which in
themselves they apply to all bicycles put onto the French Market.
Labelling (see also food section above)
Question from Switzerland:
In paragraph 52 of the review the EU refers to its voluntary eco-labeling scheme, which is available
to EU products as well as to non-EU products. It is, however, indicated that some national eco-
labeling schemes exist in parallel. Switzerland high ly welcomes the EU-wide eco-labeling scheme but
is, however, concerned that national labeling schemes, which in some countries enjoy greaterconfidence than the EU logo, might affect the trad e facilitating effect of the EU eco-label. In
paragraph 60 the EU refers to its policy on international standardization and confirms its trade
facilitating role. In this context it would be interesting to know, whether there are any efforts beingundertaken to achieve greater harmonisation between Member States on eco-labeling i.e. fully
replace national logos by the EU labeling scheme?WT/TPR/M/102/Add.2
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A: The Flower (the EU eco-label) established at the beginning of 2002 a co-operation and co-
ordination management group within the EU Eco-labe lling Board, whose role is to develop the co-
operation and co-ordination between the eco-l abels in the EU (and candidate countries).
Representatives from each of these labels participate in 4 meetings per year. A programme of work
has been initiated, amongst others to exchange information systematically, to better coordinate
product group development, to examine the possibilities of mutual recognition, and to clarify thecommon and complementary roles of the different labels with respect to different product groups,
harmonising criteria where appropriate but also maintaining divergences where appropriate.
Further details may be found on the website http://europa.eu.int/ecolabel, more specifically at:
http://europa.eu.int/comm/environment/ecolabel/background/pm_managementgroups.htm#coop
Questions from Canada:
Paragraph 51 states that a mandatory labelling requirement has been proposed for animal-tested
cosmetics until the entry into force of a ban on anim al-tested cosmetics, which would apply to all such
products, including of imported origin.
Please indicate the current situation in the EU with regard to cosmetics that have been tested onanimals.
A: As from 1 July 2002, the ban on marketing of cosmetics tested in animals, as laid down in the 6th
amendment, came into force.
Please provide the status with respect to the 6th and 7th Amendments.
A: The 6th amendment is in force. The 7th has received its second reading in the EP and will now go
to conciliation.
Please explain how the proposed ban on animal testing will be compliant with the EU's WTO-
obligations.
A: In regard to the concerns raised by Canada with respect to the marketing ban of cosmetic products
containing ingredients or combinations of ingredients tested on animals the European Commission
would like to respond as follows:
(a) Date of entry into force of the amendm ent (assuming that this relates to the 6
th amendment,
which introduced a provision on a marketing ban); notification under TBT agreement
Article 4(1)(i) of Directive 76/768/EEC , introduced by Directive 93/35/EEC (6th amendment)
provides for a prohibition of "the marketing of cosmetic products containing ingredients or
combinations of ingredients tested on animals after 30 June 2002 in order to meet the requirements of
this Directive". Therefore, according to the current provisions, there is a prohibition of the marketingin the EU of any cosmetic that would contain one or more ingredients or combinations of ingredients,
which have been subject to tests performed on animals after the 30 June 2002.
Hence either no immediate or only a very limited effect on the marketing of cosmetic products is to be
expected as ingredients or combinations which have been subject to animal testing before 30 June
2002 will not be affected by the marketing ban. One has to assume that the potential economicramifications for the time being can be considered negligible.
However, the issue of the marketing ban is currently under discussion in the context of the 7
th
amendment to Directive 76/768/EEC. Given the fact that this legislation is subject to the co-decisionprocedure, a conciliation phase was initiated at the beginning of July. To date a final political solution
to the marketing ban has not yet been found and may still take some more months.
Concerning a postponement of the current marketing ban, it has to be pointed out that the European
Commission - in the context of the responsibilities that are incumbent upon it - intends to propose anWT/TPR/M/102/Add.2
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interim solution that provides legal clarity and protection to the legitimate interests of economic
operators.The Commission is presently in the process of notifying the 7
th amendment to the TBT Committee.
(b) Coverage of the legislation
As mentioned, this marketing ban would cover all cosmetic products in the meaning of Article 1 ofDirective 76/768/EEC. For clarification, according to the EU legislation:
A "cosmetic product" shall mean any substance or prep aration intended to be placed in contact with
the various external parts of the human body (epidermis, hair system, nails, lips and external genital
organs) or with the teeth and the mucous membranes of the oral cavity with a view exclusively or
mainly to cleaning them, perfuming them, changing their appearance and/or correcting body odours
and/or protecting them or keeping them in good condition.
In addition, Annex I to the Directive gives an illustrative list of products to be considered as cosmeticproducts within the meaning of this definition:
Illustrative List by category of cosmetic products:
- Creams, emulsions, lotions, gels and oils for the skin (hands, face, feet, etc.).
- Face masks (with the exception of peeling products).
- Tinted bases (liquids, pastes, powders).- Make-up powders, after-bath powders, hygienic powders, etc.
- Toilet soaps, deodorant soaps, etc.
- Perfumes, toilet waters and eau de Cologne.
- Bath and shower preparations (salts, foams, oils, gels, etc.).
- Depilatories.
- Deodorants and anti-perspirants.
- Hair care products:
- hair tints and bleaches,
- products for waving, straightening and fixing,
- setting products,
- cleansing products (lotions, powders, shampoos),
- conditioning products (lotions, creams, oils),- hairdressing products (lotions, lacquers, brilliantines).
- Shaving products (creams, foams, lotions, etc.).
- Products for making-up and removing make-up from the face and the eyes
- Products intended for application to the lips.
- Products for care of the teeth and the mouth.- Products for nail care and make-up.
- Products for external intimate hygiene.
- Sunbathing products.
- Products for tanning without sun.
- Skin-whitening products.- Anti-wrinkle products.
Therefore, it covers most products listed under HS Chapter 33.
Governments have a role in ensuring that product labels provide basic and accurate information
relevant to the consumer, and t hat the information is factual and  not misleading. However, mandatory
labelling schemes, such as the requirement to  identify the production method of eggs, can
significantly and negatively affect market access. Please indicate what measures are being taken to
ensure that the products of third countries are not disadvantaged by this type of labelling scheme.WT/TPR/M/102/Add.2
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A: Appropriate mandatory labelling schemes for food and agricultural products could actually
facilitate trade and improve market access, by reinforcing transparency and consumers’ confidenceand, thus, increasing the overall commercial value of products.
Paragraph 52 states that a voluntary European eco-label (the Flower) award scheme has been in
place since 1992 and was revised in 2000 and that certain Member States have established their own
eco-labelling system (e.g., Germany’s Die Grune P unkt). It is also noted that companies from
developing countries benefit from a 25% reduction in fees, as well as small and medium-sized
enterprises (both reductions are cumulative) and that to date, 100 companies use the logo. Please
explain how the EU is ensuring the transparency of its “Flower” eco-labelling programs, specifically
the fair access of foreign producers to the program and to the criteria-selection process.
A: Producers from third countries are treated on an  equal basis as those from the EU/EEA, and the
product criteria are developed and revised in complete transparency. The voluntary EU eco-label
scheme is in this respect fully in line with th e international ISO 14024 standard on Type I eco-label
principles and procedures, which includes detailed provisions (amongst others) for the consultation
process, transparency and accessibility for all interested parties.Criteria for products bearing the European eco-label are developed and revised in complete
transparency. The European Union Eco-labellin g Board (EUEB), which consists of Competent
Authorities from the Member States, plus the EEA, along with other stakeholders such as
organisations representing SMEs, consumers, and i ndustry, is responsible for this. It appoints one of
its members to run ad-hoc working groups, which develop and revise criteria. In relation to specific
criteria, internationally established test methods or standards where available are always preferred to
more local ones.Contributions from non-EU and EEA countries are welcomed, and, in addition, many trade and
industry associations having membership, which extends beyond the EEA, may come to the meetings.
For each meeting minutes are produced and all minutes as well as any comments received on revised
criteria are published on the eco-label web pages: www.europa.eu.int/comm/environment/ecolabel/ .
Criteria are then finally discussed by the whole of the EUEB and other stakeholders before formal
voting on draft Commission Decisions for the new criteria.
The criteria drafting may be therefore followed by any interested party, including producers from
exporting countries, throughout the whole process, which may take up to a year or more before the
criteria are finalised. Input may be made at any time and by any interested party during this process
and all input receives the proper consideration.Producers from outside the EU/EEA are welcome to a pply for the European Eco-label. If they wish to
do so, they must apply to a Competent Authority (contact details of all of these are available on the
eco-label web page), who will handle their appli cation, and, if successful, award them an eco-label
licence. Several successful eco-label holders are from outside the EU/EEA - a recent example is a
licence awarded to a company from Hong Kong, whic h wanted to market eco-labelled light bulbs in
Denmark.
Questions from Taiwan:
The EU had mandatory labeling requirements for he alth warnings on tobacco products, and recently
adopted a new policy on tobacco products, in regard to their manufacture, presentation and sale,including labeling, to be implemented by 30 Sept ember 2002. Under this new policy, terms such as
“low tar”, “light”, “ultra-light”, and “mild” ar e all prohibited to be part of the brand. Does this
measure retroactively apply to existing tobacco com panies, and their brand names? What will be the
justification of this new policy under the TRIPS Agreement in terms of prohibiting those misleading
terms to be part of the brand?WT/TPR/M/102/Add.2
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A: The provision on misleading descriptors in Directive 2001/37/CE, concerning the manufacture,
presentation and sale of tobacco products, states that:"With effect from 30 September 2003, and without prejudice to Article 5(1) [provision on descritpion
of tar, nicotine and CO yields], text, names, trade marks and figurative or other signs suggesting that a
particular tobacco product is less harmful than others shall not be used on the packaging of tobacco
products".
The reasons for this provision are stated in recital 27 of the Directive:"(27) The use on tobacco product packaging of certain texts, such as "low-tar", "light", "ultra-light",
"mild", names, pictures and figurative or other signs, may mislead the consumer into the belief that
such products are less harmful and give rise to changes in consumption. Smoking behaviour and
addiction, and not only the content of certain substances contained in the product before consumption,
also determine the level of inhaled substances. This fact is not reflected in the use of such terms andso may undermine the labelling requirements set in this Directive. In order to ensure the proper
functioning of the internal market, and given the development of proposed international rules, the
prohibition of such use should be provided for at Community level, giving sufficient time for
introduction of this rule."
The reference to the "proposed international rule s" is to the WHO Framework Convention on Tobacco
Control, being currently negotiated both by Member States and by the EU; approval of the
Convention is scheduled by May 2003.
The rule on misleading descriptors allows for a longer introduction period (30 September 2003
instead of 2002).
As regards the TRIPS agreements, the provision is prima facie compatible both with the "national
treatment" and the "most favoured nation" clauses.
The Court of First instance of the EEC has been invested of the problem of compatibility of thisprovision with trade marks law (Case T-223/01); the Court of First instance still has to pronunce itself
on the admissibility of this challenge, (introduced  by the Japan tobacco Association vs. the Council).
We would like the EU to how to participate the public consultations on establishment and revision of
eco-labeling criteria for non-EU parties. In addition, please provide the name list of the 100companies currently using the logo (the Flower).
A: The simplest way to participate in the development of eco-label criteria is via the web site
(http://europa.eu.int).
Look on the "product groups" page(http://europa.eu.int/comm/environment/ecolabel/producers/productgroups.htm) for the product group
you are interested in.
If it is under revision there wil be a line indicating this that you can click on and will guide you to the
page giving all the details of the revision (eg
http://europa.eu.int/comm/environment/ecolabel/producers/pg_copyingpaper.htm#revision, includingall drafts, reports, minutes of metings etc.
It will indicate the contact details of the Compet ent Body leading the revison. You may contact them
if you want to make comments ot if you want to be put on their direct e-mailing list for the revision
and to receive invitations to the ad hoc working groups where the new draft criteria are debated.
Full details of the companies that have been awarded the eco-label my be found athttp://europa.eu.int/comm/environment/ecolabel/consumers/greenstore.htm.
If a Taiwanese company wishes to reply, it should contact the comptetent body in, one of the EU
countries (plus Norway, Iceland and Liechtenstein) where the product is sold (see
http://europa.eu.int/comm/environment/ecolabel/competentbodies.htm). More details on how to apply
may be found at
http://europa.eu.int/comm/environment/ecolabel/producers/howtoapply.htm.WT/TPR/M/102/Add.2
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Any questions about the eco-label for which you cannot find answers on the web site may be sent to
the eco-label help desk (seehttp://europa.eu.int/comm/environment/ecolabel/contact.htm)
Questions from Australia:
How is the current EU beef labelling regime the least trade restrictive possible?
A: The E.U. beef labelling regime provided by Regulation 1760/2000/EC has put in place a
mandatory origin labelling for beef meat. This Regulation has been set up with a public safety legal
base and with the objective to address major food safety concerns from EU consumers after the
second B.S.E. crisis. The mandatory labelling requirements enable the consumer to be aware and
informed of the whole traceability system which has been put in place for the bovine meat sector inthe E.U.
What other measures were considered before this measure was chosen?A: This Regulation has replaced a previous Regulation 820/97/EC on beef labelling which prescribed
voluntary origin labelling provisions. Such provisi ons were considered unsufficient by both the E.U.
Parliament and the Council to address the food safety concern.
What is the objective of the EU requirement for freezing dates and packing dates to be applied to
cartons of frozen product, when these are the same?
A: La directive 89/108/EEC sur les "aliments surgelés" ne contient aucune référence à cette obligation
d’indiquer dans l’étiquette une double date de surgélation et d’emballage des produits. Cette directive
se réfère aux normes générales d’étiquetage de la directive 79/112/EEC (2000/13/EC). La directive
2000/13/EC, applicable à l’étiquetage des denrées alimentaires destinées au consommateur final, ne
prévoit pas d’indication obligatoire d’une date d’emballage, quel que soit l’état du produit (frais,
surgelé, etc.), mais seulement une date de durabilité minimale (best before) ou une date limite deconsommation (use by).
What is the SPS or TBT objective being sought in labelling eggs as to method of production?
A: The method by which hens are farmed has become one of the major factors for consumers when
purchasing eggs. The Commission has undertaken to propose an amendment of the marketing
standards and to make it compulsory to indicate the farming method on eggs and packs so that
consumers are not liable to be misled. To that end, clear and unambiguous compulsory labelling is the
only way of ensuring that the consumer is able to make an informed choice between the various
classes of egg on the basis of the farming method. Appropriate compulsory labelling is in line with thewishes expressed by consumers and consumer organisations. It is necessary for compulsory labelling
to apply to all eggs sold in the European Union and purchased by consumers outside the place of
production, whether they are produced in the European Community or come from third countries.
However, in the case of eggs produced in third countries, indication of the farming method may be
replaced by the indication "farming method not specified" and by an indication of origin if thirdcountry procedures do not offer sufficient guarantees as to equivalence with the technical rules and
standards applicable to Community procedures; this will guarantee that such eggs can be
distinguished from those labelled by indicating the production method and will make subsequent
labelling with misleading indications unfeasible.WT/TPR/M/102/Add.2
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Questions from Argentina:
En lo relativo a la propuesta de Reglamento de la UE en materia de etiquetado y trazabilidad de
organismos genéticamente modificados (OGM) y de la alimentación y alimentos genéticamente
modificados preocupa lo difícil y complicado que  resultará la implementación de esta medida.
Además, dicha implementación implic ará un significativo aumento de los costos que inevitablemente
recaerá en los extremos de la cadena de comercialización (productores y consumidores).
Se agradecerá conocer en qué medida la UE ha evaluado el impacto que esta normativa
tendrá en los mercados internos y externos.
En adición, se desea conocer de qué manera se  abastecerá la UE de los productos OGM y
derivados, actualmente importados de terceros mercados, en la medida en que los proveedores
tradicionales no pueden cumplir con los estrictos requisitos de la mencionada normativa., teniendo
en cuenta que la UE no puede sustituir tales importaciones de OGM por producción interna.
A: The obligatory information requirements foreseen by the European Commission's Proposal
(notified under G/TBT/N/EEC/7 and G/SPS/N/EEC/150) are requirements that are in most cases
required either under European Community law or normal commercial transactions. The only
additional element is that this information will ha ve to be transmitted to all operators in the
commercial chain within the European Community.
The European Commission would also like to refer to  Article 18 of the Biosafety Protocol concerning
transboundary movements of living modifi ed organisms (LMOs), which provides that
• GMOs for intentional introduction into the environment have to be accompanied by
documentation that specifies their identity and relevant traits and characteristics. This clearly
requires some form of unique identification for individual GMOs.
• GMOs intended for direct use as food or feed, or for processing, shall be accompanied by
documentation which clearly identifies that they "may contain" living modified organisms and arenot intended for intentional introduction into the environment. A decision on the detailed
requirements for this purpose, including specification of their identity and any unique
identification, shall be taken no later than two y ears after the date of entry into force of this
Protocol
To date, more than 120 countries, many of which are developing countries, have signed up to the
Biosafety Protocol and this, as a matter of c ourse, includes the requirements of Article 18.
The Proposal does not require operators to identify all individual events present in a shipment of
GMOs intended for food, feed or processing. In f act, Article 4, paragraph 2 of the Proposal specifies
that the operator is only obliged to provide a list of the unique codes for the GMOs that the shipment
may contain together with a declaration that the product shall only be used as food or feed, or for
processing. A system for attributing unique codes to GMOs has already been agreed by the OECDand it is foreseen that this will be accounted for in developing the system under the Proposal.
The European Commission would also like to point out that it remains illegal to import GMOs or
genetically modified food into the European Union that have not received authorisation in accordance
with current European Community law. Operators are, therefore, already obliged to ensure that
unauthorised GMOs or genetically modified foods are not imported into the European Community.In the explanatory memorandum to the Proposal the European Commission stated that it is difficult to
estimate the costs of introducing traceability specifically for GMOs and products produced from
GMOs. This view is shared by the United States Department of Agriculture (USDA) who in a recent
article stated that "estimating the magnitude of the costs of identity preservation, tracing, and labelling
is complex and subject to varying assumptions" (see Agricultural Outlook/January-February 2002).The European Commission considers that the transmission and retention of information can largely be
incorporated into existing (documentary) systems for transactions and as such should not imply
significant extra costs for operators and consumers. Information with respect to the supplier,
customer, price, and transaction date as well as the nature, source, contents and amount of the product
already accompanies the majority of transactions.WT/TPR/M/102/Add.2
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For operators supplying food derived from GMOs to the market, traceability only implies that
operators must inform the next operator in the chai n that the food, feed or food/feed ingredient is
derived from GMOs and retain that document. This is neither particularly burdensome nor costly and
it does not entail segregation.
Aggregated costs, if any, will be passed on to the consumer and the labelling of GM foods ensures
that consumer demands will ultimately drive the market in the direction of their preferences also
taking into account the price of the food.Traceability and systematic labelling will promote transparency in the market place and the freedom
of choice for consumers, as well as, leaving it to th e market forces to decide the fate of the different
products.
The Proposal foresees that transmission and retention of information as a means to facilitate
traceability will even limit the need for sampling and testing of products to confirm their identity at
every stage of the placing on the market. This would result in a reduction in the costs for companies to
meet the current labelling criteria in European Community law particularly for retailers.
Sampling and testing would, however, still be required for verification whenever reliable
documentation is not available from exporting countries and for control and inspection purposes. A
degree of cost must, therefore, be considered in this respect. The Proposal foresees that the EuropeanCommission shall develop guidance on sampling and detection. This will minimise legal uncertainty
and alleviate the burden in terms of testing and sampling for operators. Current experience with
detection methods demonstrates that testing raw ingredients is much more simple and cost-effective
than testing the final products on the supermarket shelves.
It should be emphasised that the potential costs of traceability should also be weighed against the
potential costs of no traceability system. The establishment of effective traceability requirements
could prevent excessive economic losses or brand damage in case an unforeseen risk to human healthor the environment arises. The recent case in the United States, where a genetically modified maize
variety approved only for use in animal feed entered the food chain and the subsequent need for
urgent recall of products from the market, has clearly demonstrated the usefulness of a traceability
system. Although voluntary traceability systems can al so be useful, mandatory ones are more likely to
be followed in a consistent way by all operators in the production and distribution chain, which canalso be instrumental in helping prevent such pr oblems arising in the first place, thereby avoiding
potential huge costs for the companies involved and for public authorities.
Question from Mexico:
En el párrafo 52 del mismo capítulo del IS se describe la existencia de un sistema europeo de
concesión de una etiqueta ecológica y que, inclusive, algunos Estados miembros han adoptado uno
propio. (i) ¿Puede la UE indicar si dicha etiqueta puede ser utilizada por empresas extranjeras y, en
su caso, describir el procedimiento de obtención de la licencia correspondiente? (ii) ¿Existen o
pueden existir acuerdos de reconocimiento mutuo en esta materia? (iii) ¿Qué procedimiento debe
seguirse al efecto?
A: If a product originates outside the EU, the application may be presented to a Competent body in
any one of the Member States in which the product is to be or has been placed on the market. A list of
these competent bodies is available on the EU Eco-label web-page ( http://europa.eu.int/ecolabel) .
EU Eco-label criteria are usually developed in co-operation with national eco-label. The criteria of
some product groups might be therefore very similar. So far there are no mutual recognition
agreements between the EU Eco-label and the eco-labels of the Member States.
A detailed description of the EU Eco-label scheme, its benefits for the different stakeholders or
consumers (including public and private purchasers), a lot of background information as well as
downloadable material can be found in the above mentioned web-page.WT/TPR/M/102/Add.2
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Questions from the United States:
The U.S. is very concerned that EU approvals of new biotech products scheduled to resume in
October 2002 may be delayed until the Commission’s proposals on traceability and labeling and food
and feed are implemented, which could take many months. How will the EU ensure that biotech
approvals will resume in October?
A: Commissioners Byrne, Wallstöm and Lamy have committed to make all efforts to re-launch the
authorisation procedure on application of the Directive 2001/18/EC, which should be transposed into
national laws for application by 17 October 2002. This includes efforts to ensure adoption of a
number of implementing measures, namely guidance on risk assessment, monitoring and summary
formats for notifications, prior to 17 October 2002 such that the Directive is operational.
It should, however, be made clear that this commitment extends to an operational Directive.Commitments cannot be provided on the part of Member States or notifiers. According to the
Directive, for the procedure to re-start, notifiers  must firstly submit information to a lead Member
States to either upgrade pending dossiers or provide a completely new notification (Article 35 of
Directive 2001/18/EC). Reliance is then placed on that Member State to evaluate the risk assessment
provided for the additional information, which is subsequently transmitted to the other Member Statesfor evaluation and ultimately approval.
The Commission has always pointed to the fact that the new procedure could commence on
application of Directive 2001/18/EC but would highlight that commitment is required from notifiersand Member States for notifications to be approved.
Will the EU enforce its comprehensive traceability labeling requirement for products where no
biotech materials will remain in the food, such as in highly processed foods?
A: Traceability in the context of this proposa l (notified under G/SPS/N/ EEC/149 and G/TBT/EU/6)
can be defined as the ability to trace GMOs and products produced from GMOs at all stages of the
placing on the market throughout the production and distribution chains facilitating quality control,
labelling, and also the possibility to withdraw products. The traceability requirements are based ontransmission and retention of relevant information for such products.
The effectiveness of traceability requires that the identity of GMOs contained within a product can beestablished at its first stage of the placing on the market within the production or distribution chain.
For products imported from third countries, in particular bulk shipments of commodity crops that may
contain an unknown mixture of GMOs operators im porting such shipments into the Community will
have to specify the identity of these products, namely in terms of the GMOs that they contain. If this
information is not available from the exporter, then importers would have to determine the identity of
the GMOs in the product, which is likely to require sampling and analytical testing. The Proposal,
therefore, provides for the possibility of establishing guidance with respect to sampling and testing of
bulk commodities as a means to facilitate a common approach within the Community.The European Commission would like to point out that it remains illegal to import GMOs or
genetically modified food (this includes highly pr ocessed foods) into the European Union that have
not received authorisation in accordance with current European Community law. Operators are,
therefore, already obliged to ensure that unauthorised GMOs or genetically modified foods are not
imported into the European Community.
Certain member states have banned certain EU-approved GM products. What are the EU’s intentions
for confronting these apparently illegal bans?
A: Where a Member State has justifiable reasons to consider that an authorised product constitutes a
risk to human health or the environment, it may under Article 16 of Directive 90/220/EECWT/TPR/M/102/Add.2
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provisionally retsrict or prohibit its use or sale on its territory. There are currently a number of
ongoing Article 16 cases which need to be addressed.Directive 90/220/EEC has recently been revised. The new Directive 2001/18/EC provides for a more
stringent regulatory framework and includes provisions that address many of the concerns raised by
Member States in justification for their bans. Emphasis has been placed on the application of the new
Directive on 17 October 2002 as the means to restart the authorisation procedure and it would,
therefore, be consistent to address the Article 16 cases in this framework.
Under EU regulations, Member States have an obligation to register approved GM varieties in their
national seed registers. How does the EU ensure Member States are meeting this obligation?
A: Council Directives 70/457/EEC and 70/458/ EEC have established a Common Catalogue of
varieties of agricultural plant species and a Common Catalogue of varieties of vegetable species.
These Common Catalogues list all the varieties of seeds which are not subject in the EU and EEA to
marketing restrictions relating to the variety. The Common Catalogues are compiled on the basis of
the national catalogues of EU Member Sates and EEA countries.
In so far GMO varieties are concerned an amendment to the above mentioned Directives introducedby the Council in 1998 (Directive 98/95/EC) establishes that
- "Member States shall ensure that genetically modified varieties which have been accepted are
clearly indicated as such in the [national] catalogue of varieties."
- the common catalogues "shall clearly indicate those varieties which have been genetically
modified".
The EU organic regulations state that the EU organic logo may only be used on products which
consist of at least 95% EU-origin content. How is this consistent with national treatment
requirements?
A: EC regulations provide that the EU organic logo can only be used on product produced in line with
EC organic production standards and control systems. Thus the EU logo can equally be displayed onimported product recognised as meeting these conditions. There is no breach of national treatment
requirements.
Question from Brazil:
In document WT/TPR/S/102, chapter III, paragraph 51, it is stated that many products are subject to
rules of labelling. How does the EU exercise control on the conformity of such products with the
labelling requirements? Is the control done at the consumption or at the entrance of the product in the
Communitarian territory? Is there any documentation involved in the process? If so, which?
A: Labelling requirements for chemicals are laid down in Directive 67/548 on dangerous substances
and Directive 1999/45 on dangerous preparations. Control of conformity with such requirements is
the responsibility of the competent authorities of the Member States. It can be carried out both at the
entrance into the EU and within its territory.
Question from Chile:
Según el informe de la Secretaria “desde 1992 existe un sistema europeo de concesión de una
etiqueta ecológica facultativa (denominada la “flor”) que se revisó en el año 2000; algunos
miembros han establecido su propio sistema de et iquetado ecológico (por ejemplo Die Grune Punkt,
en Alemania”. Chile desearía conocer alguna evaluación de estos sistemas de etiquetado facultativo,
los inconvenientes que su uso pueda haber ocasionado, cómo se compatibiliza su condición de
facultativo con la extensividad de sus uso y, es pecialmente cómo funciona el etiquetado alemán.WT/TPR/M/102/Add.2
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A: The EU Eco-label (the "Flower") is a market-based voluntary instrument that has as a major
twofold purpose:- to promote the design, production, marketing and use of consumer products and services that
have a reduced environmental impact during their entire life-cycle, and
- to provide consumers with better information on the environmental quality of products and
services, to help them make informed environmental choices in their purchases.
Products that meet strict ecological and performan ce criteria are awarded with the Flower logo. This
logo can be displayed as a marketing tool to show consumers that the product has a superior
environmental performance.
A detailed description of the EU Eco-label scheme, its benefits for the different stakeholders, eg.
producers or consumers (including public and private purchasers), a lot of background information as
well as downloadable material and news can be found in http://europa.eu.int/ecolabel .
In order to know how the German labelling works,  we suggest contacting the German administration
(Umweltbundesamt, Mr Loewe, Tel +493089033025; fax +49 3089033099; christian.loewe@uba.de)
Recientemente, el Parlamento Europeo aprobó cambios a las existentes regulaciones sobre el
etiquetado para alimentos procesados derivados de OGMs. Los nuevos requisitos serían más estrictosy obligatorios para toda la cadena de producción.  ¿Cómo y cuándo se implementarían estas nuevas
regulaciones? ¿Cuál es la base científica para su adopción?
A: The proposal for a Regulation on GM food and feed (notified under G/TBT/N/EEC/6 and
G/SPS/N/EEC/149) extends the current labelling provisions, mandatory in the EU since 1997, to all
genetically modified food irrespective of the detectability of DNA or protein. Food and feed that
consists of, contains or is produced from GMOs w ould have to be labelled as such. Thus, all products
which are subject to authorisation under the proposed Regulation, would henceforth also be subject to
mandatory labelling.
The European Parliament in its first reading has broadly supported the proposed new labelling
requirements. The report of the European Parliame nt will now be transmitted to the Council. It is
expected that the Council will adopt its Common Position this autumn and the legislative process willcontinue through the year of 2003.
One of the most important purposes of labelling is to provide full and accurate information to
consumers and to allow them to make informed choices in relation to the foods they purchase or
consume. It is to inform consumers "as to the characteristics of the food and, in particular, as to its
nature, identity, properties, composition, quantity, durability, origin or provenance, method ofmanufacture or production" (Article 2(1)(a)(i) of Directive 2000/13/EC on the labelling, presentation
and advertising of foodstuffs).
Since there is solid, cumulatively very strong evidence that European consumers are interested to
know whether their food is derived from genetically modified organisms, it is totally justified for
labelling to provide them with this information as well. In any case it is worth noting that aconsiderable number of countries around the world have adopted labelling rules that provide precisely
this information.
The proposal for a Regulation concerning traceability and labelling of genetically modified organisms
and traceability of food and feed products produced from genetically modified organisms  (notified
under G/TBT/N/EEC/7 and G/SPS/N/EEC/150)  would ensure that information  concerning whether a
food or a feed is consisting of, containing or produ ced from a GMO is available at all stages of the
placing on the market and should thereby facilitate accurate labelling of the final product and provide
the means for inspection and control of labelling claims.
Questions from India:
Belgium has proposed draft legislation in February 2002, which would provide seals to products that
have been made in compliance with the 8 ILO basic conventions. The social seal is intended to informWT/TPR/M/102/Add.2
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the consumer about the quality of the production pr ocesses. While recognizing the fact that this
measure is proposed to be adopted on a voluntary basis, India is concerned about this law as it linkssocial concepts with trade and thus ignores the Singapore Ministerial Decision of the WTO that
clearly provides that ILO is the competent body  to set and deal with the labour standards. The
proposed Belgium legislation seeks to usurp the role of ILO as inter Governmental agency overseeing
the adherence to core labour standards. This law would also go against the concept of like product
defined in Article III of GATT and apply a non-product related PPM to discriminate between likeproducts. Although to be applied voluntarily, it will influence consumer behavior and thus affect the
market access of countries whose products do not carry the seal We would request EU to respond to
these concerns.
A: We do not share the view that the Belgium (voluntary) label is a problem.
The WTO has closed the case after a second notification by Belgium. In the second notification
Belgium clearly demonstrated that the label is voluntary and that it is non discriminatory as also
Indian companies can apply.
We do not agree with India alleging that Belgium legislation seeks to usurp the role of the ILO as an
intergovernmental agency overseeing the adheren ce to core labour standards. Belgium has simply
used the ILO standards as a reference scheme.
Presently, EU has a Directive 76/768/EEC governing the laws of the member states relating to
ingredients of the cosmetic products. EU now propo ses to amend the directive with a view to ensure
labelling of the cosmetics in a manner that 26 of specific ingredients declared as allergens cannot be
used. The amendment would require labelling of  the 26 ingredients on all cosmetics and toiletry
products when level exceed 10 ppm in stay-on products (i.e., lotions, perfumes) and 10 ppm in rinse-
off products (shampoos). 16 of the alleged allergens occur naturally in more than 150 essential oils,
which are mixtures of many components. India is  concerned that this could eliminate the use of
essential oils by the manufacturers. India’s view is that essential oils should be considered as single
entities and be exempt from the proposed directive. The proposed thresholds are far too low to allowsignificant use of natural oils. India would request EU to respond to this observation.
A: In regard to the concerns raised by India with respect to the proposed labelling requirements for 26
fragrance ingredients, the European Commission would like to respond as follows:
By way of initial comment, the European Commission would like to state that the above-mentionedissue is currently under discussion in the context of the 7
th amendment to Directive 76/768/EEC.
Given the fact that this legislation is subject to the co-decision procedure, a conciliation phase was
initiated at the beginning of July. To date, a final outcome of the legislative process cannot be
predicted and may still take some more months.
The current labelling requirements for cosmetic products already provides the listing of cosmetic
ingredients on the products, with the exception of perfume and aromatic compositions and their raw
materials, which are referred to by the word "perfume" or "flavour". The ingredients must be
identified by their INCI name, which is more comp rehensible for consumers than the chemical name.
In order to improve consumer information, a labelling scheme for fragrance ingredients with a well-
recognised potential to cause contact allergies is proposed. This labelling system will allow
consumers to avoid products containing certain ingredients they are sensitive to.
The Commission Directives are based on the scientific opinions given by the Scientific Committee on
Cosmetic products and Non-Food Products intended fo r the Consumer (SCCNFP). With regard to the
26 fragrance ingredients mentioned by the Indian government, the Scientific Committee has made no
specific derogation for essential oils.
The proposed labelling system will mention the in gredient without any other reference as to the
effects of its utilisation. The concentration as proposed in Amendment 28 (second reading of theEuropean Parliament) is a threshold level for the provision of providing information (10 ppm forWT/TPR/M/102/Add.2
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leave-on products and 100 ppm for rinse-off products). It has to be pointed out that the foreseen
threshold levels do not constitute a usage limit of fragrance ingredients in cosmetic products.However, the labelling will indicate the name of  the potential allergen(s). The amendment does not
intend to ban the marketing of the 26 fragrance ingred ients, but to provide an appropriate labelling to
enable the consumer to make informed choices.
Hence either no or only a very limited effect on the marketing of cosmetic products is to be expected.
One has to assume that the potential economic ramifications can be considered negligible.The Commission is presently in the process of notifying the Council's common position on the 7
th
amendment to Directive 76/768 to the TBT Committee.
Question from Thailand:
The EU’s mandatory labelling requirements for foods and food ingredients produced from GMOs,
and the proposed comprehensive traceability requirements for products containing, or produced from
GMOs, may act as unnecessary impediments to exports from developing countries. These
requirements impose onerous compliance conditions that those countries may not be able to fulfil due
to lack of appropriate data management and manipulation and insufficient laboratory facilities fortesting and certification purposes. We would appreciate to know whether the European Union
envisages any course of action to avoid those requirements creating unwarranted obstacles to exports
from developing countries.
A: Reference can be made to WTO document G/SPS/GEN/338, G/TBT/W/180, 26 July 2002,
(02-4173)
In this document the European Commission has an swered the question on the possible burden for
developing countries.
The mandatory labelling requirements for foods and food ingredients produced from GMOs exists in
the EU since 1997. The labelling is triggered by the presence of DNA or protein resulting from
genetic modification.
The proposal on genetically modified food and feed extends the current labelling provisions to allgenetically modified food irrespective of the detectability of DNA or protein.
The proposed traceability requirements would ensure that information concerning whether a food or a
feed is consisting of, containing or produced from a GMO is available at all stages of the placing on
the market and should thereby facilitate accurate labelling of the final product and provide the means
for inspection and control of labelling claims.The obligatory information requirements foreseen by the European Commission's Proposal are
requirements that are in most cases required either under European Community law or normal
commercial transactions. The only additional element is that this information will have to be
transmitted to all operators in the commerc ial chain within the European Community.
The European Commission would also like to refer to Article 18 of the Biosafety Protocol concerningtransboundary movements of living modifi ed organisms (LMOs), which provides that
GMOs for intentional introduction into the environment have to be accompanied by documentation
that specifies their identity and relevant traits and characteristics. This clearly requires some form of
unique identification for individual GMOs.
GMOs intended for direct use as food or feed, or for processing, shall be accompanied bydocumentation which clearly identifies that they "may contain" living modified organisms and are not
intended for intentional introduction into the environment. A decision on the detailed requirements for
this purpose, including specification of their identity and any unique identification, shall be taken no
later than two years after the date of entry into force of this Protocol
To date, more than 120 countries, many of which are developing countries, have signed up to the
Biosafety Protocol and this, as a matter of c ourse, includes the requirements of Article 18.
The European Commission will provide guidance on sampling and testing prior to the application ofthe traceability provisions to facilitate implementation.WT/TPR/M/102/Add.2
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The European Commission is ready to consider requests from developing countries for technical co-
operation and assistance to address identified priorities and needs.
Waste
Questions from Australia:
In terms of regulations developed and implemente d to manage waste, how does the EU apply the
polluter pays principle? Given the costs of regulation are generally passed onto consumers or
taxpayers, through pricing or subsidisation: (a) is the rationale based on supply or demand of a
product;( b) is it consistent across product and commodity ranges, including agricultural production;
and (c) if not on the latter, please provide information to demonstrate the rationale and approach?
A: The polluter pays principle is one of the fundamental principles of the Community’s environmental
policy. This principle, which is general in its nature, is applied by the EC on a case by case.
Considering that it would be impossible to measure the environmental impacts of pollution in each
instance and charge the polluter accordingly, the EC waste policy requires certain standards on wastetreatment which are usually paid by the waste handler who in turn charges various actors. Ultimately,
it is mostly the consumer or the taxpayer that pays. As mostly there is no demand for waste, this is a
fixed amount representing the costs of the treatment.
More recently the concept of producer responsibility has been applied, which aims to use the specific
role of the producer in order to render waste management more efficient and to give incentives to
design products in a way that favour re-use and recycling. It also takes away the costs of waste
management from the taxpayer to the producer and ultimately in most cases the consumer. Thisconcept has been used in the End-of-life vehicle directive and the WEEE Directive. Further debate on
whether to extend this concept will be held, inter alia, in the framework of the planned Thematic
Strategy on Recycling. Producer responsibility will, however, not be applicable to all waste streams in
the same way and needs to be judged on a case by case basis. The details and reasons for covering one
or the other waste stream are linked mainly to practical questions (e.g. whether recycling makes senseand needs financing, whether there is a possible effect on the environmental design of products etc.)
and will need to be discussed further in the Thematic Strategy on Recycling.
Please explain how regulations to manage polluti on in waterways from nitr ates are implemented and
managed? How are the costs associated with these regulations allocated to producers? Are theseefforts yielding positive environmental benefits? If not, how does the EU plan to address this issue?
A: The EU has addressed nitrates pollution of waters in comprehensive, legally binding and
enforceable legislation:
• by addressing pollution at the source via emission controlds (via legislation on waste waters from
domestic and industrial sources, requiring nitrogen removal from waste water wherever an
affected water is eutrophic and/or shows nitrate values beyond drinking water values, or is about
to reach such a level of pollution, and on agri culture (limiting nitrogen use at the source of
impact, in terms of maximum amount of applicatio n to fields, minimum storage facilities, as well
as restrictions in terms of time and location),
• on the other hand by setting water quality standards (ecological and physico-chemical ones,
including provisions for phasing out eutrophication and for nitrates values above drinking water
standards).
Operational instruments for implementing this policy are the Water Framework Directive as well as
Directives on Urban Waste Water Treatment, on Nitrates Pollution from Agriculture and on
Integrated Pollution Prevention and Control. Indeed, the Water Framework Directive of 2000 has
thoroughly restructured and expanded water protection in the EU:WT/TPR/M/102/Add.2
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• protecting all surface and ground waters, and imposing a binding obligation to achieve/maintain
good quality ('good status') by 2015 at the latest;
• combining emission controls and water quality standards; in each particular case the more
stringent approach will prevail;
• providing for mandatory public participation when developing the programmes to achieve good
status;
• linking economic instruments to environmental objectives, by an obligation to do an economic
assessment of water use, and to provide for cost r ecovery for water-related services such as water
supply or waste water disposal and treatment.
Costs for the necessary measures will therefore, as a rule, have to be covered by those causing the
environmental impact, in line with the polluter pays  principle enshrined in the environment chapter of
the EC Treaty.
Implementation of these set environmental objectives is one of the key tasks of the European
Commission, by a range of measures:
• by legal enforcement measures, including applications to the European Court of Justice; the
ECTreaty provides for a system of penalty payments in case of non-respect of Court rulings;
• by promotion and exchange of technical and scientific information (to stakeholders as well as
national and regional administrations);
• by awareness-raising measures to inform the broader public about the importance of water
protection measures;
• by promoting research and technology in the field of water protection and water management.
Action taken has already delivered environmental benfits, e.g. a breakthrough a regards the quality of
rivers and lakes (e.g. the Rhine and Elbe rivers turning from being nicknamed 'sewers' to being home
to the salmon again). As for those water not ye t complying with environmental standards, the
necessary objectives have been set in a binding and enforceable way.
Questions from Canada:
Paragraph 53, states that with respect to product -related waste management, the EU adopted the
directive on end-of-life vehicles for transposition into national law by 21 April 2002; the Commission
issued a proposal on waste electronic and electrical equipment (WEEE) and on restricting use ofcertain hazardous substances in such equipment; it proposed a revision to the packaging waste
directive; and it launched a consultation on managing PVC (e.g., plastics from vehicles).
A: The information contained in paragraph 53 is in principle correct. Please note that in the meantime
agreement between the European Parliament and the Council has been found in the conciliation
committee on WEEE and RoHS (proposal to restrict the use of hazardous substances in new
electronic equipment). The two above-mentioned directives are due to be adopted before the end of
the year. On PVC, it is planned to issue a communication, which covers all sources and not
specifically vehicles.
Canada shares the EU’s co mmitment to the protection of health  and the environment, but questions
the overly prescriptive approach of the substance bans included in these product-related waste
management directives. Canada continues to question whether such substance bans are proportionate
to any attendant risks, and questions whether such measures are more trade restrictive than necessary
to achieve the objectives indicated in the proposa ls. Please explain how the EU will be addressing
these concerns in the development of the substa nce and domestic implementatio n of these directives.
A: The view of the Community is that such measures are necessary to protect the environment and
human health, including workers health and safety (in particular recycling workers).WT/TPR/M/102/Add.2
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The substance bans included in the waste management directives are based on available scientific
evidence and are proportionate with regard to th eir objective, which is to eliminate concerned
substances from the waste stream. The same objective cannot be achieved with any other measure as
this would still mean that the substances will occur in waste and put into danger the health of
recycling workers and the environment through polluting releases.
It should be noted that both the ELV (end-of-life vehicles) and RoHS Directives contain exceptions
for applications for which no suitable technical replacement is available. These bans have then to beimplemented into national legislation. The Community will further review the technical annexes to
keep them up to date with technical developments, in  particular with a view to eliminating exemptions
where technical replacements are available. This will be done on the basis of the principles identified
in Community legislation, including the ELV and RoHS Directives themselves.
With reference to paragraph 54, we note the Commission decision of June 27, 2002, which has
extended the implementation date for a ban on the us e of Nickel Cadmium batteries in electrical
vehicles to 31 December 2005. Canada is of the view that risk management must be based on a
comprehensive and scientifically-sound assessment of the risks posed to humans or to the
environment. Please indicate when is the EU’s risk assessment on Cadmium expected to be completedand if the results will be shared with EU’s trading partners.
A: A specific targeted risk assessment on cadmium in batteries was started in 1999. On 25 February
2002, the Belgian rapporteur for the targeted risk assessment on cadmium (oxide) in batteries
circulated a 45-page discussion document. A draft report (124 pages) was circulated on 19 August
2002. This report is expected to be finalised by the end of 2002. The final report will be available for
the public and thus also for the EU’s trading partners.
Paragraph 55 states that under the proposed WEEE directive, producers will be responsible for
collecting waste electrical and electronic equipmen t from designated collection points for treatment.
Please explain the rationale that led to the ban on the use of certain nonferrous metals in a broad
range of electrical and electronic equipment. In the absence of any thorough risk assessment, itappears that the measures are more trade restrictive than necessary and as a result may create
unnecessary barriers to trade.
A: The rationale behind the substance bans is explained in the explanatory memorandum to the
Commission proposals. In brief, non-ferrous metals  can seriously damage human health. In addition,
non-ferrous metals can adversely affect the environment and have acute and chronic toxic effects on
plants, animals and micro-organisms. The same prot ection cannot be achieved with any other measure
as this would still mean that the substances will occur in waste and put into danger the health of
recycling workers and the environment through polluting releases.
The Commission’s proposal with the explanatory memorandum is available on the following website:http://europa.eu.int/eur-lex/en/com/pdf/2000/en_500PC0347_02.pdf
Please provide copies of the scientific rationale for the bans on the use of mercury, cadmium, lead,
and hexavalent chromium, as well as an explanation as to why less trade restrictive methods of
controlling these substances have been ruled out.
A: The rationale behind the substance bans is explained in the explanatory memorandum to the
Commission proposals. This is available on the following website:
http://europa.eu.int/eur-lex/en/com/pdf/2000/en_500PC0347_02.pdf
These metals can adversely affect the environment and have acute and chronic toxic effects on plants,animals and micro-organisms as well as on human  health. The same protection cannot be achievedWT/TPR/M/102/Add.2
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with any other measure as this would still mean that the substances will occur in waste and put into
danger the health of recycling workers and the environment through polluting releases.
Please indicate the steps that will be taken to  mitigate the negative impact on small- and medium-
sized exporters of the proposal to have producers individually bear the costs associated with the
implementation of the waste electronic and electrical equipment (WEEE) directive.
A: There is no indication that there is any disproportionate negative impact on small- and medium-
sized exporters. No such evidence is known from existing recycling schemes such as e.g. in the
Netherlands, Sweden, Denmark or Belgium. If the question points at the substance bans in the RoHS
Directive, these bans will apply in a similar way as  any other technical requirement for products to be
put on the European market.Assistance for SMEs will not be different than for any other Community legislative requirement. For
details of available funding opportunities, please consult e.g.:
http://europa.eu.int/comm/secretariat_general/sgc/info_subv/index_en.htm
The EC Commission, upon appropriate request from  a developing country, may also provide the
necessary technical assistance. Some initiatives of this kind are already being considered.
Questions from Japan:
Japan appreciates the EU’s efforts in the area of en vironment, such as recycling. At the same time,
environmental regulations should not be too restrictive on business activities. In this regard, the
directives on waste electrical and electronic equipment (WEEE) and on restricting the use of certain
hazardous substance in such equipment (ROHS), which are now in preparation in the EU, should
have a considerable impact on the Japanese industry supplying large amounts of electrical andelectronic equipment to the EU market. Japan has therefore requested under the WTO that the
regulations of these directives do not create any extra burden on the industry. Japan further hopes
that the opinions of the industrial side, including the Japanese industry, be reflected in future
discussions.
A: Japanese companies and business associations have been part of the consultations on the various
drafts of the WEEE and RoHS directives all thr ough the preparatory process of the Directive. It
should be noted that our impression of these consultations were that Japanese industry is among the
best prepared industries for the new requirements which will apply to all companies in the same way,
irrespective of their origin. It is the Community’s firm intention to continue with intensive stakeholderconsultation for any further adaptation of the Directives that concern industry.
Japan understands that the European Commission is making a study on a revision to the exceptions
list for the ELV directive. Seeing as the current exceptions list does not completely cover substances
considered to be irreplaceable, Japan requests expansion of the list in this regard.
A: Article 4(2) of Directive 2000/53/EC on end-of life vehicles prohibits the use of lead, mercury,
cadmium and hexavalent chromium in vehicle materials and components put on the market as from 1
July 2003 (‘heavy metal ban’). Annex II to this Di rective, however, provides for a list of exemptions
from this heavy metal ban, if the use of the substance is unavoidable. Generally, the Directive obligesthe Commission to amend Annex II on a regular basis, according to technical and scientific progress.
More specifically, the Directive obliged the Commission to amend the list of exemptions of Annex II
for the first time no later than 21 October 2001 (one year after the entry into force of the Directive).
The Commission fulfilled this obligation by a dopting Commission Decision 2002/525/EC of 27 June
2002 amending Annex II. This Commission Decision obliges the Commission to revise the phase-out
of certain exemptions by a specific date. However, this future revision will concern the questionWT/TPR/M/102/Add.2
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whether certain existing exemptions should be maintained. It seems unlikely that during future
revisions of Annex II new exemptions will be added to the current list of exemptions of Annex II.
Research on alternative products for nickel cadmium batteries is progressing and, in the course of
such research, it has become clear that there are some areas in which no other product can replace
Ni-Cd batteries. In particular, such areas would be where instantaneous, high electric current is
required, and where minute current is necessary for a long period of time. Japan, therefore, reiteratesits request that Ni-Cd batteries be removed fr om the regulation targets of the aforementioned
directive.
A: There is no doubt that cadmium is dangerous both for the environment and human health and is
internationally recognised as such. At this moment, Directive 91/157/EEC on batteries andaccumulators containing certain dangerous substances does not prohibit the use of cadmium in
batteries. However, current Community legislation with respect to batteries and accumulators should
be revised. Whether or not the revision will include a cadmium ban is still under consideration.
Questions from Taiwan:
We note that both “The Directive on Waste Electrical and Electronic Equipment (WEEE)” and “the
Directive on the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic
Equipment (HEEE)” require producers be held responsible for recycling waste electrical and
electronic equipment and restricting use of certain hazardous substances in such equipment. On these
two directives, Taiwan requests the EU clarify the following issues:
(a) To comply with the WEEE directive, foreign producers must either set up recycling facilities or
collect waste equipment for further treatment. In th is regard, foreign producers will be more likely to
bear higher recycle cost than EU’s producers. Could the EU provide its justification for the
differences of cost imposed between local and foreign producers. Also, please provide EU’s endeavor
in avoiding unnecessary negative impact on market access for foreign producers.
A: As far as the new waste (i.e. from products pu t on the market after autumn 2005) deriving from
consumer products for private households is concerned, producers (importers in the case of imported
products) have to provide the financing for the collection from the collection point onwards, including
dismantling, such as re-use, recovery and recy cling of their products. They may fulfil these
obligations either individually or by joining a collective system. No producer will be required to set
up own recycling facilities nor to collect its own waste. This can be done via joining a recyclingsystem.
As far as the waste deriving from products used  by consumers other than private households is
concerned, producers (or importers) are required to take back their equipment but may use third
parties to do the collection etc. They also need to provide the financing. In other words, they need to
provide financing but are free how to arrange the practical aspects.As far as the historical waste from private ho useholds is concerned, producers need to pay a
contribution to a collective recycling system.
As far as the historical waste from non-private sources is concerned, producers will be subject to
payment scheme similar to the one for new products from non-private sources, although this issue is
still being considered in the context of the procedure to approve the two mentioned directives.From the above-explanation, it is clear that there is no provision in the referred legislation that,
directly or indirectly, distinguishes between domestic and foreign producers. As any other technical
requirements applying for the EC market, the prov isions of the WEEE and RoHS Directive will apply
in the same way for domestic and imported equipment. The Commission will further ensure the
proper implementation of the directives, including th e non-discrimination in the collection systems for
waste from electrical and electronic equipment.WT/TPR/M/102/Add.2
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(b) The purpose of HEEE is for environmental protection. However, it would negatively affect the
market access of other WTO members in the EU market if the technology of production andsubstitutes were not practical. Could the EU undertake to explore alternative measures with less trade
distorting effects?
A: The substance bans are necessary to protect the environment and human health, including workers
health and safety (in particular recycling workers). It should be noted that both the WEEE and RoHSDirectives contain exceptions for applications for which no suitable technical replacement is
available. The same protection cannot be achieved with any other measure as this would still mean
that the substances will occur in waste and put into  danger the health of recycling workers and the
environment through polluting releases.
In the further development of the RoHS Directive, the Community will consider the availability ofsuitable alternatives to the concerned substances and all options to reduce the impact on the
environment and human health.
(c) Could the EU explain how the restrictive effects of the two directives are justified under WTO
rules of TBT Article II or GATT 1994 Article XX?
A: The Community firmly believes that the restri ctive effects of the WEEE and RoHS directives can
be justified on the basis of the grounds listed in Art. XX (b) and (g), as their implementation will not
result in unjustifiable discrimination or disguised restrictions of international trade.
Concerning Art. 2 of the TBT Agreement, the protection of the environment and human health are
considered a legitimate policy objective. The same protection cannot be achieved with any other
measure as this would still mean that the substances will occur in waste and put into danger the healthof recycling workers and the environment through polluting releases.
(d) What is the status of the WEEE Directive in terms of its adoption? What are the conformity
assessment procedures for the WEEE Directive? What is the implementation schedule for the
conformity assessment procedures of the WEEE Directive?
A: The Conciliation Committee has agreed on a text for the WEEE and the RoHS Directive on 10
October 2002. This needs to be formally adopted by the Council and the European Parliament by the
end of the year. This makes publication and entry into force likely to happen in the first half of 2003.
Member States need to transpose the legislation by late 2004. Other deadlines are defined in theDirective. There is no conformity assessment procedure in either Directive because neither Directive
is a "New Approach" Directive.
(e) The report states that the EU proposed a revision to the packaging waste directive. What is the
status of this proposed directive? When will it be notified? When is it planned to be implemented?
What are the elements to be revised in the proposal?
A: The Council reached a political agreement on a common position on the proposed revision on 17
October 2002. Adoption of the revision is likely to happen late 2003 at the latest, depending on the
further discussions in Council and Parliament. The directive does not add any technical requirementsbut merely increases the recycling and recovery rates of the existing directive. The deadline for
achievement of the new targets is not yet agreed between Council and Parliament. There are special
deadlines for Greece, Ireland and Portugal. The deadline for the accession countries needs to be
negotiated at a later stage.WT/TPR/M/102/Add.2
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Question from Korea:
With regard to the EU scheme for recycling requirements stipulated in the Secretariat Report, it
should be pointed out that the required recycling rate is overly restrictive in comparison to similar
standards of the U.S. and Japan. It would be better if the recycling rate were raised gradually rather
than having it high from the beginning. Too strict an application of the Polluter Pay Principle may
produce moral hazards for consumers and inefficient resource distributions.
The Korean Government hopes that the EU takes in itiative to share technology and information with
foreign countries who have not yet developed capacity to  meet the directive. What is the view of the
EU on this?
A: The European Union has an explicit objective of achieving a high level of environmental
protection. The recycling targets are set with a vi ew to achieving an appropriate balance between
economic, environmental and social factors. It is unclear how the application of the polluter pays
principle can produce moral hazards. On the contrary, it may rather be that this is the case if the
polluter does not pay for environmental damage and the environmental costs have to be borne by
society or result in environmental degradation for present and future generations.
The European Union has various assistance programmes, inter alia, the ones that can be found on thefollowing website:
http://europa.eu.int/comm/secretariat_general/sgc/info_subv/index_en.htm
The EC Commission, upon appropriate request from a developing country, may also decide to provide
the necessary technical assistance as a Trade and Environment initiative.
Question from Mexico:
En el párrafo 53 del mismo capítulo del IS se mencionan algunas directivas referentes al manejo de
desechos. (i) ¿Cómo va a afectar a las importaciones de vehículos de terceros países la directiva de
fin de vida de vehículos para transportación?, (ii) ¿Qué implicaciones tendrá la directiva referente a
desechos en equipo eléctrico y electrónico para las importaciones de estos productos en el mercado
comunitario?
A: (i) ELV
Directive 2000/53/EC on end-of life vehicles (‘ELV Directive’)8 aims at minimising the impact of
end-of life vehicles to the environment by promoting the prevention of waste from vehicles as well as
the collection, treatment and recovery of end-of life vehicles.
The ELV Directive applies to all vehicles and end-of life vehicles including their materials andcomponents placed on the EU market, irrespective of the place where the vehicles are produced, the
place of establishment of the vehicle producer or the brand of the imported vehicle.
In particular, the ELV Directive obliges vehicle manufacturers or professional importers of vehicles
into a Member State of the EU:
• to limit and reduce the use of hazardous substances in vehicles;
• to design and produce vehicles which facilitate the dismantling, re-use, recovery and recycling of
end-of life vehicles;
• to increase the use of recycled materials in vehicle manufacturing;
• to ensure that components of vehicles placed on the EU market after 1 July 2003 do not contain
mercury, hexavalent chromium, cadmium or lead, except in cases listed in Annex II to theDirective.
The national law of a Member State may oblige vehicle manufacturers or professional importers of
vehicles into this Member State to meet all, or a significant part of, the costs related to the free takeback possibility for the last holder/owner of an end-of life vehicle.
                                                     
8 OJ L 169 21.10.2000, p. 34.WT/TPR/M/102/Add.2
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In order to meet the reuse, recovery and recycling targets of the Directive, Member States may also
oblige vehicle manufacturers or professional importers of vehicles into this Member State to ensurethat a minimum percentage by average weight per vehicle will be reused, recovered or recycled.
Vehicle manufacturers or professional importers of vehicles into a Member State of the EU are also
be required to use coding standards and provid e dismantling information in accordance with the
national laws of the Member States implementing the Directive.
(ii): WEEE
Trade Issues:
The proposed Directives on waste and electrical and electronic equipment
9 and restriction of the use
of certain hazardous substances in electrical and electronic equipment (RoHS)10 are the subjects of an
going decision procedure between the Council and European Parliament.
The proposed Directives remit is to all electrical and electronic equipment on the EU market. Nodistinction is made where the goods have been manufactured. No direct or indirect discrimination of
imported products will arise. The measures proposed are necessary to fulfil the objectives of the
proposed Directive.
The Commission does not consider that the Proposed Directives are contrary to International Trade
Law. The Proposed Directives were based on available scientific evidence and are proportional withregard to the objective to eliminate the concerned substances from the municipal waste system. The
requirement does not discriminate against foreign producers of electrical and electronic equipment.
The Proposed Directives were notified under the TBT agreement (Article 2.9) in July 2000.
Question from Malaysia:
The proposed EU regulation on waste of electronic and electri cal products shifts the responsibility of waste
disposal to producers and importers. Wh ile proper waste disposal is necessa ry, it is questioned whether such a
system is not more trade restrictive than necessary. A di sparate waste disposal syst em incurs more costs than a
centralized system. In addition, small-scale producers would be most affected by this measure, as they have to
contribute to costly disposal systems that do not maximize economies of scale. What does the EU intend to do tomitigate the costs of such a system on small-scale producers?
A: Directive 2002/96/EC on Waste Electrical and Electronic Equipment (WEEE) provides that
producers provide for the financing of the collection, treatment, recovery and environmentally sound
disposal of consumer WEEE. This means that Producers have to pay for new waste, that is from
products put on the market after 13 August 2005, and hi storical waste, that is from products put on the
market before 13 August 2005.In relation to new waste, producers can choose to fulfil their obligation either individually or by
joining a collective scheme. Under a collective scheme producers fulfil their finance obligation by a
flat rate levy or fee on new equipment. Under individual financing each producer is responsible for
paying the waste from their own products but is fr ee to choose the way to fulfil this obligation. A
producer could, for example, pick up their own waste from collection points, or make a contract with
a collective system and ask for an individual invoice.
The Directive provides producers with the option to join a n existing or new collective system or not.
It is an issue of how a producer will seek fulfil their obligations. We have not encountered evidence
that small scale producers would be disadvantaged, as they could, if they wish, join a collective
system.
Question from Thailand:
The European Union has proposed to put in place a number of regulations aimed at fulfilling the
pursued environment objective, which include the Directive on WEEE (Waste of Electrical andElectronic Equipment), Directive on ROHS (Restriction on the Use of Certain Hazardous Substances)
                                                     
9 OJ C 365 E, 19.12.2000, p.184 and OJ C 240 E, 28.8.2001, p.298
10 OJ C 365 E, 19.12.2000, p.15 and OJ C 240E, 28.8.2001, p.303.WT/TPR/M/102/Add.2
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and the Integrated Product Policy (IPP). Once entering into force, these directives may impose
burdensome compliance conditions, which will consequentially affect exports of developingeconomies, including those of Thailand. As a result, manufacturing industries in developing countries
need to adjust themselves to bring their products in to conformity with these regulations if they wish to
secure markets in the European Union.
In view of the prevalence of technological deficiencies and underdeveloped capacities in these areas
in the majority of developing country Members, we would be interested to hear the EU’s view if thesenew technical regulations and standards may act as disguised and unwarranted restrictions on trade.
We would also like to know if the European Union considers granting a transitional period as well as
providing technical assistance for capacity building to the developing countries to allow proper
adjustment of their industries to the new regulations.
A: The proposed Directives on waste and electrical and electronic equipment
11 and restriction of the
use of certain hazardous substances in electrical and electronic equipment (RoHS)12 are the subjects of
on-going decision procedure between the Council and European Parliament.
The proposed Directives remit is to all electrical and electronic equipment on the EU market. No
distinction is made where the goods have been manufactured. No direct or indirect discrimination ofimported products will arise. The measures proposed are necessary to fulfil the objectives of the
proposed Directive.
Trade Issues
The Commission does consider that the Proposed Directives are consistent with International TradeLaw. The Proposed Directives were based on available scientific evidence and are proportional with
regard to the objective to eliminate the concerned substances from the municipal waste stream. The
requirement does not discriminate against foreign producers of electrical and electronic equipment.The Commission Proposals were notified under the TBT agreement (Article 2.9) in July 2000.
The Commission will ensure the proper implementation of the Directives, including non-
discrimination in the collection systems for waste electrical and electronic equipment.
No transitional period for third countries are foreseen.
IPP
Integrated Product Policy (IPP) is a holistic appro ach that aims at continuously lowering the overall
environmental impacts of products throughout their life cycles (cradle to grave). A green paper13 on
this issue has been published and is also available electronically14. A white paper is presently under
preparation. IPP may ultimately encourage and guide the application of various existing economic,
legal and fiscal instruments (the so called IPP toolbox) but any details are still being discussed.The Commission will ensure that any instruments it may apply in the frame of a future IPP will be
used in such an appropriate, non-discriminatory and non-protectionist way.
(c) Standards
Question from Switzerland:
To paragraphs 57 - 66: The EC plays an active role in the development of International standards for
industrial products that could gradually replace existing European standards. The final purpose of
this strategy is to have a set of harmonised product standards for industrial products that shall be
applicable worldwide. Switzerland is of the opinion that the drawing of International standards and
their global application and recognition should not be restricted to product standards but should beextended to international standards for conformity assessment as well. Switzerland would like to know
                                                     
11 OJ C 365 E, 19.12.2000, p.184 and OJ C 240 E, 28.8.2001, p.298
12 OJ C 365 E, 19.12.2000, p.15 and OJ C 240E, 28.8.2001, p.303.
13 COM (2001) 68, final – 07.02.2001
14 http://europa.eu.int/comm/envi ronment/ipp/2001developments.htmWT/TPR/M/102/Add.2
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if the EC intends to change its policy and recognizes  in future conformity assessments that have been
performed by conformity assessment bodies accredited according to such standards (for exampleISO/CASCO 17000 series), provided these bodies ar e covered by an arrangement concluded with the
European Co-operation for Accreditation EA, or if the EC will continue to make the recognition
depending on the existence of a mutual recognition agreement in relation to conformity assessment.
A: Standards are drafted by national, regional or international standardisation bodies. In the field
covered by New Approach directives, when harmonised standards (which have been mandated, to be
developed by the European standardisation bodie s CEN, CENELEC and ETSI) are used, they are
presumed to fulfil the essential requirements of th e respective Directive. However, application of
harmonised standards remains voluntary.
Standards of the EN 45000 series are referred to in Council Decision of 22 July 1993 on a GlobalApproach to conformity assessment. The Guide on the implementation of directives based on the New
Approach or the Global Approach gives in chapter 6 on Notified Bodies extensive information on
Community policies in this area. As a principle, the use of standards of the EN 45000 series is not
mandatory either.
It is the responsibility of the designating authority of Member States to assess the competence ofconformity assessment bodies that wish to become active as a notified body in a certain field of
activity.
Whether these authorities use or not accreditation a nd in this context EN 45000 series standards, it is
up to them to decide. The requirements applicable for notified bodies are the relevant elements to be
found in each New Approach directive annex.
EN ISO 17000 series of standards do not fulfil the requirements for them to be considered as
harmonised standards in the sense of the New Approach directives.However, they can be used, on a voluntary basis, as any other non- harmonised standard. The possible
differences between them and the EN 45000 series standards and the overall assessment of such future
notified bodies remains entirely the responsibility of the designating authority and of the Member
State.
With respect to the recognition of conformity asse ssments performed by bodies outside of the EU, this
is only possible at present where a formal agreement has been reached between the EU and the third
country concerned. Such agreements are the EEA, MR As or PECAs. It is too soon to predict whether
there will be a change in policy on this principle in the future.
Questions from Canada:
Paragraph 60 states that it is also of the view that international standards "may be seen as beneficial
in some instances, but they may be perceived as little advantageous or even as threats in others".
Please explain how the EC determines that an exis ting international standard is of little advantage or
even a threat (or not meeting the public policy objectives).
A: When determining whether to use an internationa l standard as a basis for technical regulations the
EC fully complies with article 2.4 of the TBT Agreement that states "Where technical regulations are
required and relevant international standards exist or their completion is imminent, Members shall use
them, or the relevant parts of them, as a basi s for their technical regulations except when such
international standards or relevant parts would be  an ineffective or inappropriate means for the
fulfilment of the legitimate objectives pursued…"
Please elaborate on the methodology  used and indicate who is responsible for that assessment.
A: The methodology varies from sector to sector where mandatory compliance with technical
requirements is necessary taking into account the obligation in Article 2.4 of the TBT Agreement.WT/TPR/M/102/Add.2
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Please indicate if the process open and transparent.
A: The EC fully complies with the obligations set out in articles 2.9 to 2.12 of the TBT Agreement.
Please state how foreign parties can become aware that such an assessment is under way and
whether representations can be made to whomever conducts this assessment.
A: Please see above.
Relating to paragraph 61, please explain how can the differential in level of transposition of
international standards between the CEN (40%) and the CENELEC (80%) be explained, given the
fact that the CEN committed itself, and the CENELEC has obliged itself to adopt internationalstandards as European ones. Please indicate if the EC, or the CEN, is considering measures at this
point to narrow the differential.
A: The differential in the transposition of ISO and IEC standards can be explained by the scope of
both the IEC and CENELEC dealing exclusively with the electro-technical sector and the ISO and
CEN dealing with all others. Since CEN and ISO standardisation activity covers a broad range of
products, services and applications from all other than the electro-technical sectors there is higher
cultural and geographic diversity in their activities. In the electro-technical field which is also
characterised by goods that are intensively traded on world markets there is less divergence.
Questions from Japan:
Japan understands that the EU is independently goi ng ahead with establishing standards to protect
the safety of pedestrians. As such standards have an indirect effect on the grand design of a vehicle, it
is essential to bring them into international harmonization. Japan therefore requests that the EU
establishes its standards by reflecting therein the study report of the International Harmonized
Research Agenda (IHRA), under the framework of th e World Forum for the Harmonization of Vehicle
Regulations (UN/ECE/WP29).
A: The EU supports the principle of global harm onisation of technical requirements. Indeed, the EU
has actively promoted international harmonisation in the area of pedestrian protection by taking the
initiative and proposing terms of reference for a working group within the 1998 UN/ECE Global
Agreement to deal with the further developments in this field. The chairman of this working group
comes from Japan.
At the present time the IHRA Pedestrian Protection working group has not reached its final
conclusions. Earlier this year (6 months late) at the end of their 5 year mandate, the group presented a
report, but because they had not reached final conclusion, they requested further time, and were
granted another three years to finalise their work. Their final report is not now expected until 2005,after which the UN/ECE WG on Pedestrian Protection will have to prepare specific proposals for a
GTR based on that report. Consequently, a proposal can not be expected until 2006, probably, with
agreement/entry into force, possibly in 2008. Therefore any IHRA/GTR provisions are still 5 or 6
years away.
Nonetheless, there are already many similarities between the EU provisions under consideration and
those of the IHRA. Many of the provisions su ggested by IHRA are based on development work
carried out by the European Enhanced Vehicle-safety Committee (EEVC) sponsored by the
Commission and Member States and used as the basis for the work within the Commission and the
industry. Furthermore the provisions that will  be proposed by the Commission are based on a
voluntary commitment by the European, Japanese and Korean car manufacturers who have been able
to participate in the development work with in the IHRA working group. They have no doubtWT/TPR/M/102/Add.2
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considered the intermediate results of the work that have been available from IHRA when drafting
their commitment.Finally, pedestrian protection is a major road safety issue within the EU. It would be unacceptable to
delay introduction of provisions while awaiting final conclusions from IHRA and the development of
a GTR. When IHRA was established in Melbourne, Australia in 1996 the participating countries
stated that participation in the IHRA co-operation "... does not mean ... that the participating countries
have agreed to a moratorium on regulations". The Commission, therefore, believes that it is fullywithin its rights and obligations to bring forw ard provisions for pedestrian protection. Those
provisions, though, can in the future be adapted to technical progress to take account of the final
conclusions of the IHRA pedestrian protection working group, and a GTR.
Practical discussions for establishing Global Technical Regulations, based on the 1998 Global
Agreement, as part of the efforts to enhance au tomobile safety and to promote an international
harmonization of automobile standards, have begun at the World Forum for the Harmonization of
Vehicle Regulations (UN/EC E/WP29). Japan requests the EU’s positive cooperation when
establishing Global Technical Regulations in the field of driving view.
A: The EC would be supportive of Japanese efforts to establish Global Technical Regulations in the
field of driving view. In this context the EC is looking forward to Japan presenting further results
from its current consultation process on his matter in the appropriate UN-ECE working group.
Question from Thailand:
In regard to the Commission Regulation (EC) No. 1223/2002 dated 8 July 2002 concerning the
classification of certain goods in the Combined Nomenclature, we would like to seek the EU’sclarification as to the classification of the product which is described in the Annex to the said
Regulation. The product of concern is salted chicken cuts, frozen and impregnated with salt in all
parts, having a salt content by weight of 1.2% to 1.9%. Our questions are:
What is the rationale for the Regulation?
The basis or reasoning for using such a specific percentage of salt content to distinguish betweensalted chicken under CN code 0210 and CN code 0207 14 10.
Did the EU have prior consultation with interested parties?
We are of the view that frozen salted chicken, no matter what the percentage of salt content would be,
after being defrosted, it is the same product as the unfrozen salted chicken, which retains its essential
character. However, when defrosted, it would have a different characteristic, especially in taste, whencompared with that of plain frozen chicken.
A: The objective of the regulation 1223/2002 of 9 July is to ensure an uniform application of the
Combined Nomenclature. The product in question is not salted chicken meat but chicken meat frozen
for long term conservation. The method of conservation of the product is freezing and not salting. Thepercentage of salt is to low to ensure the conservation. The addition of salt does not alter the character
of the product as frozen meat of heading 0207. Consequently, the above measure is WTO compatible.
Question from Taiwan:
The report states that the standardization is near ing completion for toy, weighing instruments, gas
appliances, and simple pressure vessels. We woul d like to know when the program of harmonized
standards (as mentioned in COM(2001)527) will be finalized and the content of the program.
A: The content of the program can be found in the workprogram of the European Standardisation
Committee CEN and on the internet (www.cen.org). The business plans of the respective technical
committees provide information on the progess of work in these areas.WT/TPR/M/102/Add.2
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Question from Mexico:
Los párrafos 59 a 62 del capítulo III del IS, describe la situación y nuevos desarrollos en cuanto a la
política de la UE con respecto a las normas internac ionales. Al respecto, (i) ¿Puede la UE indicar el
porcentaje concreto de reglamentos o normas técn icas, tanto a nivel comunitario como nacional, que
son idénticas o equivalentes a las normas internacionales? (ii) ¿Puede la UE señalar qué
procedimiento se sigue para justificar las desviaci ones de las normas europeas o nacionales, respecto
de las normas internacionales y dónde puede consultarse esa información? (iii) ¿Puede la UEseñalar del total de normas europeas, cuantas se han adoptado en áreas dónde no existen normas
internacionales? (iv) ¿Puede la UE exponer su de finición de organismo y norma internacional? (v)
¿Puede la UE responder si los nacionales de Miembros de la OMC pueden participar en las sesiones
de los comités de normalización, tanto a nivel nacional como europeo y describir el procedimiento a
seguir para obtener ese derecho, o bien, en caso de que la respuesta sea negativa justificar lasrazones por las que no se permite tal participación?
A: (i) Concerning technical regulations Article 2.4 of the TBT Agreement provides that Members
shall use international standards or the relevant parts of them as a basis for their technical regulations
except when such international standards or relevant parts would be an ineffective or inappropriatemeans for the fulfillment of the legitimate objectives pursued. To use international standards as a
basis for technical regulations does not mean the sa me thing as being identical or equivalent with an
international standard. The European Communities has no statistical material on technical regulations
being identical or equivalent with international stan dards. Concerning the percentage of European and
national standards being identical or equivalent  with international standards, the European
standardisation bodies as well as the national standardisation bodies follow ISO/IEC guide 21 :1999
Adoption of international standards as regional or national standards.(ii) As indicated above, this is done on the basis of ISO/IEC guide 21 :1999. Relevant information on
this issue as well as on the standards being identical with international ones can be obtained from any
standizing body having accepted the WTO Code of Good Practice for the Preparation, Adoption and
Application of Standards. The Code of Good Practice provides that :
(J.) at least once every six months, the standardizing body shall publish a work programme. … Thework programme shall for each standard indicate, …, the references of any international standards
taken as a basis. … The standardizing body shall notify the existence thereof to the ISO/IEC
Information Centre in Geneva. The notification shall contain the name and address of the
standardizing body, …, and how and where it (the work programme) can be obtained.
(iii) As indicated in WT/TPR/S/102, 40% of the European standards adopted by the CEN, theEuropean Committee for standardisation, are based on international standards from the ISO. 55% of
the existing 8.900 European standards published by CEN deal with issues not dealt with by the ISO.
These concern in particular personnel protective equipment and machinery. We have also indicated
that CENELEC, the European Committee for electrotechnical standardisation, has about 80% of its
European standards based on international ones from the IEC. The differential in the transposition ofISO and IEC standards can be explained by th e scope of both the IEC and CENELEC dealing
exclusively with the electrotechnical sector which is characterised by goods that are traditionally
traded on world markets.
(iv) For the European Communities it is essential that international standards are prepared by an
international organisation who is impartial, open to participation by one national delegation from eachWTO member and who does not produce national or regional standards, but exclusively international
ones. The European Communities provided several submissions concerning its definition of an
international standardizing body and an internationa l standards. These were contained in the following
documents:WT/TPR/M/102/Add.2
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G/TBT/W/74, and Add.1 30 June 1998
10 August 1998TBT Agreement Code of Good Practice,
Paragraph J: Publication of the Work Programmes of Standardizing Bodies -
Note from the European Communities
G/TBT/W/87 and Rev.1 14 September 1998
30 September 1999The Conditions for Acceptance and Use of International Standards in the
Context of the TBT Agreement – Note from the European Community
G/TBT/W/133 11 April 2000 Second Triennial Review of the Operation and Implementation of the
Agreement on Technical Barriers to Trade - Note from the European
Community
G/TBT/W/149 1 November 2000 Principles of coherence and singularity to be observed by international
standardizing bodies - Contribution from the European Communities
(v) The European Communities is of the view that , in principle, there is no need for other WTO
members to participate in the national standardisation process of another member or in the regionalprocess of other members if the respective work could be carried out in international standardisation
bodies. However, in the absence of sufficient inte rest for preparing international standards within
international standardizing bodies, cooperation at a lower (regional or bi-lateral level) may be deemed
beneficial. Under such circumstances it is important that the preparation of relevant regional or
national standards is carried out in a transparent way. For this purpose, and in order to avoidduplication and overlap, the European standardisation bodies CEN and CENELEC have concluded
cooperation agreements with the ISO and the IEC. ETSI, the European telecommunications
standardisation institute has a similar agreement with the ITU. Under these agreements and only if the
international standardisation community decides to have standardisation work carried out in a regional
body, a certain number of non-European standardisation bodies can send representatives to join thetechnical work. However, the final adoption procedure of the respective standards is carried out in
parallel in the international and the European organisation.
Question from Brazil:
The Report by the Secretariat quotes the following statement by the European Commission:
“[International standards] may be seen as beneficial in some instances, but they may be perceived as
little advantageous or even as threats in others” (WT/TPR/S/102, page 44). Does the European
Commission seek to justify in those lines the creation of technical standards even though they may be
incompatible with international rules? Are those international rules not a sound basis for the
formulation of technical standards by the EU?
A: Unfortunately, as pointed out earlier to the secretariat, this quote is out of context. The statement
does not represent the Commission's view but is rather a description of public concern described in
the quoted document. The thought being developed is the following. There is, however, widespread
concern among the public on the appropriateness, use and limitations of international standards for
political and ethical  reasons or due to cultural  diversity. [...] Whilst international standards may be
seen as beneficial in some instances, they may be perceived as little advantageous or even as threats inothers. Different national standards or not having a recognised standard at all could also reflect
differences in risk perception, individual tastes or distinctive markets.
This statement should not distract from our general policy that internationally traded goods need
international standards and that European stakeholders are interested in collaborating with their
trading partners to facilitate market access and economic integration through the use of internationalstandards and the creation of standards-receptive economic and legal conditions. Generally, regional
or national standards should be aligned to the greatest possible extent to international standards, but
the value of national and regional standards as stepping-stones to international standardisation should
also be recognised.
The fact that some European technical standards differ from international ones is rather founded in theright of every sovereign country to define the level of protection it deems appropriate to meetWT/TPR/M/102/Add.2
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legitimate objectives, subject to the requiremen t that they are not applied in an arbitrary or
discriminatory manner.
Question from India:
European Union (EU) members have widely different standards, testing and certification procedures
for some products. The member states of EU issue rapid alerts against the export consignments of
such exporters whose consignments are found to be affected by microbiological or chemical
contamination. The procedure of such control me asures varies from one member state to another.
Apart from the variation in the control procedur es, which puts the exporters to difficulty, the
procedure for withdrawal of the control measures is  also not uniform. Even if the originating country
withdraws the control measures, the measures put in place against the exporter in other member
countries remain in force for an indefinite period. This seriously affect the access of exportingcountries. We would like to hear from EU whethe r they intend to harmonize the varying checks and
procedures methods?
A: The Commission is preparing proposals on officil feed and food controls that aim to ensure that
results of official sampling and analysis are obtained on the basis of common principles. The proposalintroduces in particular requirements for laboratories to implement methods of analysis that are
validated in accordance with internationally accepted protocols (CEN/ISO). The laboratories that are
designated to analyse official samples shall in addition operate in accordance with Good Laboratory
Practices (GLP) and be accredited in accordance with  the relevant international standards established
for that purpose.
(d) Conformity assessment
Questions from Canada:
Paragraph 64 mentions that to reduce the burden of  conformity assessment, two types of agreement
have been concluded by the EU: Protocols to th e Europe Agreements on Conformity Assessment and
Acceptance of Industrial Products (PECAs); and Mutual Recognition Agreements (MRAs) for the
results of conformity assessment with certain third countries. Both types of agreement provide for themutual acceptance of test reports, certificates, and marks of conformity issued by designated CABs in
“sectors” established in Annexes. It would appear that PECAs are inconsistent with MRA principles
and WTO obligations due to the discriminatory effect these agreements can have on European-
originating goods versus non-European originating goods. In this context, please indicate how rules
of origin will be applied to conformity assessment in accession countries.
A: PECAs are not inconsistent with MRA principles and WTO obligations, since they relate to
candidate countries for membership of the EU; attention is drawn to Art.XXIV of the GATT, as
follows: "the provisions of this Agreement shall not  prevent, as between the territories of contracting
parties, the formation of a customs union or of a free-trade area or the adoption of an interimagreement necessary for the formation of a customs union or of a free-trade area". (See also reply to
question 71).
Paragraph 65 states that PECAs have been concluded with Hungary and the Czech Republic and
entered into force in mid 2001, with sectors being added as negotiations progress. We understand thatthis PECA contains a rule of origin clause. Pl ease indicate the steps underway to amend this
requirement to be more in line with recent PECAs negotiated with Latvia and Lithuania.
A: Nonetheless, the Community has proposed to the partners in MRAs and PECAs where there are
Rules of Origin, that they be withdrawn.WT/TPR/M/102/Add.2
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Paragraph 66 states that Mutual Recognition Agreements(MRAs) were already in force at the time of
the last Review with Australia, Canada, Israel, New Zealand, and the United States. Please indicatewhich MRAs are currently envisioned or under negotiation with the EU. Please indicate their
timeframe of implementation.
A: An MRA with the Swiss Confederation cam e into force in 2002. No other MRAs are in
negotiation.
Questions from Taiwan:
We would like to know the Territorial Applicati on Article that appears in all Mutual Recognition
Agreements between the EU and other countries, i.e. United States, Canada, Australia, New Zealand,
and Japan. May we have further information on the exact meaning of this Article? Does it apply toproducts’ origin, meaning that only those products of  EU origin could benef it from this Agreement?
How to interpret the provisions of the TBT Agreement in relation to the rules of origin requirement
included in such conformity assessment agreements? Do such requirements potentially violate the
provisions of the TBT Agreements?
A: Restrictions on applicability of MRAs and PECAs according to the origin of the goods covered
(rules of oirigin) appear in the MRAs with the Swiss Confederation, with Australia, and with New
Zealand; and to the PECAs with the Czech Republic  and with Hungary. However, the Community has
proposed to all these partners that such origin restrictions be removed.
Please advise what are the countries with whic h EC would like to sign the MRA. What are the
application procedure and the length of time required?
A: The Commission has outlined its plans for future measures in this field in Document
G/TBT/W/173/Add1: Implementing policy for external tr ade in the fields of standards and conformity
assessment: a tool box of instruments to which attention is drawn. No new MRAs are currently under
negotiation.
Question from Mexico:
En cuanto al inciso d) (párrafos 63 a 66 del capítulo III del IS) relacionado con la evaluación de la
conformidad, ¿Puede la UE indicar cuál es el procedimiento para reconocer una norma extranjera o
procedimiento de evaluación de la conformidad como equivalente y, en su caso, cuántas normas oprocedimientos de evaluación de la conformidad ha reconocido?;
describir el procedimiento para la acreditación de organismos que lleven a cabo la evaluación de la
conformidad de normas y reglamentos técnicos a nivel europeo, estatal o municipal?;
indicar en qué casos la evaluación de la conformidad con los reglamentos técnicos puede ser llevada
a cabo por organismos acreditados y, en su caso, si es necesaria una autorización adicional por
parte de la autoridad gubernamental encargada de la aplicación de dicho organismo?;
señalar si es posible que un organismo de evaluación de la conformidad (laboratorio, organismo de
certificación, unidad de inspección, etc.) acreditado en un Miembro de la OMC puede llevar a cabo
dicha evaluación de la conformidad respecto de reglamentos o normas técnicas europeas, nacionales
o municipales, ydescribir el procedimiento para la evaluación de  la conformidad de normas o reglamentos técnicos
expedidos por sus Estados miembros o las jurisdicciones locales de estos, y indicar si los
procedimientos de evaluación de la conformidad en  los tres niveles (comunitario, nacional y local)
son sujetos a consulta pública y a revisión periódica una vez que han entrado en vigor?WT/TPR/M/102/Add.2
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A: (i) recognition of equivalency has to be done on a case by case basis and the application of this
principle is still at a relatively early stage. For further information, please refer to the toolbox paper
mentioned in paragraph 66. The following site address refers:
http://europa.eu.int/comm/enterprise/international/sec_2001_1570_en.pdf
(ii) make reference to the Guide to the New and Global Approach on the following web-site address:http://europa.eu.int/comm/enterprise/new approach/legislation/guide/legislation.htm
The Guide is available in all EC languages including Spanish.
The issue of accreditation is addressed in Chapter 6.
(iii) Member States are responsible for the notification of notified bodies. They have the right to
propose bodies operating under their jurisdiction which comply  with the requirements of the
directives, which do not require accreditation as a mandatory requirement.
(iv) Only if a MRA exists.(v) This question can be answered in detail by an examination of the notifications made by individual
Member States. However, in principle, in the non-harmonised area, the technical regulations are a
Member State responsibility, although, needless to say, the provisions of the TBT agreement must be
met.
(vi) Yes. Community and national level legislation are both subject to public consultation. Concerningthe part of the question dealing with periodic revision please see a previous reply.
Question from the United States:
The United States is concerned that the harmoniza tion of regulatory requirements in EU accession
countries not result in unjustifiable discrimination or unnecessary obstacles to international trade. In
this regard, we note that under the EU’s PECAs with Hungary and the Czech Republic (para 65),
EU-origin products in designated sectors which co mply with EU requirements are no longer subject
to additional testing. Non-EU origin products, however, which have been tested to the same European
requirements and demonstrated their conformity with the applicable EU technical regulations (e.g.,
carry a CE-mark from an approved lab) may be subjected to redundant testing. In our view, this
EU-origin provision raises serious questions abou t the WTO compatibility of these agreements.
Please clarify how the EU intends to address th e problematic EU-origin provision and implement
these agreements in a manner which ensures that non-EU products do not face discriminatory
treatment.
A: Nonetheless, the Community has proposed to the partners in MRAs and PECAs where there are
Rules of Origin, that they be withdrawn.
(ix) Government procurement
Questions from Canada:
Paragraph 67 states that an indicator of the extent to which procurement is “open” to competition is
the share of procurement that is openly advertised in the Official Journal (Table III.5). According tothe latest available figures, some 15% of all pr ocurement in the EU (about _ 205 billion) was
advertised in the Official Journal in 2000, up by almost 100% from 1995. In light of the ongoing work
on transparency in the Working Group on Transparency in Government Procurement, please indicate
what constraints the EU faces in raising the percentage of procurements advertised above the current
15% average across its member countries.
A: The figures presented on table III.5 refer to procurement advertised in the Official Journal of the
EC, in accordance with the provisions of the EC Directives on Government Procurement and above
the thresholds applied in the GPA. Most of the remaining procurement is advertised according to
internal rules of EU Member States, publicly available through national official journals and local
newspapers or other ways of publicity the national legislation may foresee. Therefore the fact thatWT/TPR/M/102/Add.2
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15% of EU procurement is published in the Official Journal of the EC should not be interpreted as the
rest not being advertised at all, the remaining procurement is advertised at national or local level.
Paragraph 67 also provides estimates of total gover nment procurement only. Please indicate the total
value of GPA-covered procurement by the European Commission and Member States. The GPA went
info effect six years ago. Many members have submitted at least some annual statistical reports, but
the European Union has not. Please indicate when the EU plans to submit its statistics.
A: The EC offer to the GPA basically correspond to the coverage of EC Directives and therefore the
size of both regimes is similar, without taken into account GPA specific exclusions. Some GPA
Parties have recently submitted statistical reports according to Article XIX of the Agreement. The EC
intends to submit such report as soon as all data is collected and processed.
In relation to paragraph 69, what constraints are Germany facing in raising the percentage of
procurements advertised in the Official Journal above 6%?
A: Table III.5 indicates Government Procurement as a percentage of GDP. Considering that the GDP
of Germany in 2001 was estimated to amount 2 063 000 million EUR with a 0,6 % increase compared
to previous year, the fact that Government Procurement advertised in the Official Journal of the EC
represents 6% of GDP already indicates the importance of this sector. Therefore a 1% increase on
Government Procurement advertised in the Official Journal of the EC is very significant in terms of
value and it is higher than GDP increase for the same period of time. A highly decentralised system in
Germany allows local procuring entities to launch relatively small tenders often falling under GPA
thresholds.
Paragraph 72 indicates that under the proposed new legislative framework, the first group of three
directives would be consolidated into a single directive, covering supplies, works, and services.
Paragraph 73 adds that other proposed substantiv e amendments to these directives concern the
introduction of the new possibilities for relations between the contracting authority and suppliers.Please explain this statement.
A: The statement is no more than an introduction to the modifications referred to (ie competitive
dilaogue and framework agreements; other examples are central purchasing entities and electronic
auctions).
Please explain the “greater flexibility for technical specifications” referred to in paragraph 73 as
forming part of the new legislation and identify how the provisions will be consistent with the GPA.
A: This greater flexibility relates to the introducti on in the directives of the possibility to specify
technical requirements in terms of performance where in current law reference has to be made to
detailed technical specifications (ie standards); this  is compatible with GPA (art VI) which states that
"technical specifications shall where appropriate be in terms of performance...".
Please explain whether and how the new Commission strategy on Corporate Social Responsibility
will be reflected in the new legislative framework for government procurement referred to in
paragraphs 72 and 73.
A: CSR is "essentially a concept whereby companies decide voluntary to contribute to a better society
and a cleaner environment" (European Commission Green Paper: "Promoting a European Framework
for Corporate Social Responsibility", July 2001, COM(2001) 366), it goes to the behavior of theWT/TPR/M/102/Add.2
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company. It follows, that a bid from a company, which applies the principles of CSR, does not present
a better value for money over a bid from a company, which does not.The principle of best value for money being confirmed in the revised directive (Political agreement
was reached in Council 21 May 2002 for the directive proposal COM(2000) 275 on the coordination
of procedures for the award of public supply contracts, public service contracts and public works
contracts and is awaiting second reading in the Parliament), there is little room for CSR, as defined
previously, in public procurement .The directive does however allow for social and environmental considerations to be taken into
account: non-compliance with relevant legislation, i.e. in the social or environmental field, may be
taken into account by the purchaser in order to exclude a contractor from participating in a contract.
Questions from Costa Rica:
Se señala que un indicador del grado de apertura a la competencia de la contratación es la
proporción de ésta que es anunciada abiertamente en el Diario Oficial (aproximadamente un 15% de
todas las contrataciones realizadas en el año 2000). Del valor de compras totales del Estado, ¿qué
monto o porcentaje corresponde a contrataciones adjudicadas a proveedores extranjeros?
(Párrafo 68)
A: The EU does not have figures for the amount of total procurement awarded to foreign suppliers in
2000. Moreover the reliability of any figures in this respect are, in part, determined by the definition
and application of rules of origin. The latest figures which are available, from a survey undertaken in
1998, suggested that the level of import penetration into public procurement markets for the EU as a
whole was 10.3%, of which 1.8% was direct and 8.5% was indirect. (See OJ C 330 E, 21/11/2000
(p. 186)).
Se establece que se aplicará un único umbral armonizado para cada categoría de contratos,
expresado en euros. ¿Cuáles son los parámetros y la racionalidad económica que utilizó la Unión
Europea para definir dichos umbrales? También se incluye dentro del ámbito de los servicios
comprendidos los de telecomunicaciones. ¿Qué consideraciones provocaron la inclusión de losservicios de telecomunicaciones? (Párrafo 72)
A: The thresholds referred to in paragraph 72 are the result of a political agreement which sought to
balance the possible administrative costs of imposing formal EU wide procedures against the likely
economic benefits of inviting EU wide competition across a whole range of goods and services. Theyare, of course, in broad alignment with the GPA thresholds.
The reason for including telecommunication services within the scope of this first, consolidated,
Directive is the same as the reason cited in paragraph 74 to justify the exemption for telecom
operators from the utilities Directive, namely that  effective competition has been realized in the
sector.
Se señala que parte de las modificaciones sustantivas propuestas se refieren a una modificación de
los criterios de adjudicación y selección. ¿Qué consideraciones se tomaron en cuenta para modificar
o establecer estos criterios? (Párrafo 73)
A: The proposed modifications to the selection and award criteria (described in paragraph 73) are
aimed at simplifying, clarifying and improving the definition of criteria in order to encourage greater
transparency and competition. Thus, for example, there are dispositions which clarify what criteria are
legitimate in respect to selection criteria and the principle of announcing the relative weighting to be
given to different award criteria has been introduced."WT/TPR/M/102/Add.2
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Question from Mexico:
En los párrafos 72 a 74, del capítulo III del IS, se describe la legislación propuesta en materia de
compras del sector público que tiene como objeto armonizar criterios en la materia a nivel
comunitario. ¿En cuanto tiempo prevé la UE que entrarán en vigor las directivas descritas?
A: We suggest that Mexico follows developments in the legislative process on the SIMAP web-site
(http://www.simap.eu.int), where developments will be posted from time to time.
Questions from Brazil:
With regard to the legal framework for public bidd ings in the EU, are there any “eco-labeling” or
“eco-audit” requisites in the EU rules for governm ent procurement by its bodies? Are there “social
clause” requisites in such rules?
A: The public procurement directives do not contain any explicit reference to environmental
protection or any specific provision on the pursuit of social policy goals.
However, the existing environmental rules and the rules in the social field (either Community
legislation or national legislation compatible with Community law) are binding upon contractingauthorities.
Any specific additional conditions relating to environmental or social considerations must be
compatible with the Treaty rules, notably the pr inciples of non-discrimination and equal treatment.
Thus, any reference to "eco-labeling" must be related to the subject of the contract, only indicative of
the level of protection required and any equivalent solution must be accepted.
The EU Commission has issued two interpretative communications on the possibility to consider
those criteria in public procurement:- Interpretative communication of the Commission on the Community Law applicable to public
procurement and the possibility for integrating environmental considerations into public procurement
(COM(2001)274 adopted by the Commission on 4 July 2001).
- Interpretative communication of the Commission on the Community law applicable to public
procurement and the possibilities for integrating social considerations into public procurement(COM(2001)566 adopted by the Commission on 15 October 2001).
What is the current state of the negotiating proc ess on government procurem ent between the EU and
Canada? Is it being negotiated under the aegis of the WTO (Agreement on Government Procurement)
or by means of purely bilateral talks?
A: The EU and Canada are both Parties to the GPA. Frequent contact takes place between both
delegations at the GPA committee or bilaterally about the functioning and review of the GPA. There
are not specific bilateral negotiations out of the context of the WTO.
Are there any "buy-local restrictions" in the agreements on government procurement signed by the
EU? Should the answer be in the affirmative, how ar e such rules implemented vis-à-vis the national
treatment clause? How broad are those measures? Do they aim at providing some sort of incentive
for any sector in particular? Is there any link between those clauses and the protection and incentive
to small and medium enterprises?
A: The agreements concluded by the EU usually provide for equal treatment and non-discrimination.
There are not specific provisions about local preferences or incentive or protection to small and
medium enterprises.
A project has been sent to the European Parliament that should unify all the EU Council Directives
that deal with government procurement — nam ely Directive 92/50/EEC on the coordination ofWT/TPR/M/102/Add.2
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procedures for the award of public service contracts; Directive 93/36/EEC on the coordination of
procedures for the award of public supply contracts; and Directive 93/37/EEC on the coordination ofprocedures for the award of public works contracts. Has this unification already been approved?
Should the answer be in the affirmative, under what legal document has it been done? What changes
are there to the disciplines on technical specifications?
A: The process is still ongoing.
Reference document: Modified proposal for a Directive of the European Parliament and of the
Council on coordination of procedures for the award of public supply contracts, public service
contracts and public works contracts, COM(2002)236 of 6th May 2002.
With regard to changes to the disciplines on te chnical specifications, a greater flexibility has been
introduced which is reflected in the possibility to specify technical requirements in terms ofperformance, whereas in the current legislation reference has to be made to detailed technical
specifications (ie standards); this change is compa tible with GPA ( art VI) which states that "technical
specifications shall where appropriate be in terms of performance..."
How does the “competitive dialogue” between a contracting authority and the different bidders work
in the light of Directive 97/52/EC, which establishes that contracting authorities may seek or accept
advice which may be used in the preparation of specifications for a specific procurement, provided
that such advice does not have the effect of precluding competition?
A: The "competitive dialogue" does not have the effect of precluding competition, as any interested
supplier has the possibility to participate in the call for competition. To the extent that companies
participating in the competitive dialogue assist a contracting authority in the definition of its
specifications, they do it in an equal footing with  their competitors which also participate in the
competitive dialogue. In general, according to th e EU legislation, a company helping a contracting
authority to define its specifications cannot par ticipate in the subsequent award procedure based on
such specifications to the extent that this would be to the detriment of fair competition.
How are concessions dealt with within the European system of government procurement?
A: Although "concessions" are distinct from "government procurement" under EC law, article 3 of
Directive 93/37/EEC provides for a "lighter" regime for concessions of public works: works
concessions are essentially subject to the public procurement advertising rules; the authority grantingthe concessions must observe the rules of the Treaty, notably the non-discrimination principle.
Does the European legislation foresee any case in which countries that are not members of the EU or
of the WTO Agreement on Government Procurement may take part in an international tender? Should
the answer be in the affirmative, w hat legal document establishes that?
A: The question of market access for suppliers from third countries is dealt with by self-executive
international agreements by the EU.
What system of classification of goods, services and public works is used in the agreements on
government procurement kept by the EU?
A: References to services are often made in relation to the Universal List of Services, as contained in
document MTN.GNS/W/120 and United Nations CPC (C entral Product Classification). References to
construction services are made in the sense of section 5 of the CPC. In case there are references to
goods, the classification system used is the HS (Harmonised System) and if necessary, completed by
other subdivisions of the Combined Nomenclature (CN) as contained in Regulation 2658/87.WT/TPR/M/102/Add.2
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Is the information on government procurement — such  as internal legislation, statistics, publication
of future tenders and the results of past tenders — by the EU central unit and the members’ sub-central units available on the internet?
A: The relevant information can be found on the following sites:
- SIMAP (Système d’Information pour les Marchés Publics - http://simap.eu.int): EU legislation,
public procurement policy, EU procurement opportunities.- TED database (Tenders Electronic Daily - http://ted.eur-op.int): on-line version of the Supplement S
to the Official Journal of the European Communities containing, i.a., call for tenders, contract awards
and information notices.
In document WT/TPR/S/102 it is stated (paragraphs 67 and 68) that expenditure on government
procurement in the EU rise up to 16% of the EU’s GDP, or over 1,350 billion euros in 2000.
Nevertheless, only 15% of that amount (205 billion euros) is open to competition and advertised in the
Official Journal. Is it correct to conclude th at 85% of all government procurement in the EU is
currently closed to foreign competition, even to suppliers from other EU member states? In what
sources, other than Official Journal, should the entities advertise their tenders? What kind of goods,services and public works are statistically the ones most excluded from foreign competition?
A: The figures presented paragraphs 67 and 68 and table III.5 refer to procurement advertised in the
Official Journal of the EC, in accordance with the provisions of the EC Directives on Government
Procurement and which are, notably, above the thresh olds applied in the GPA. Much of the remaining
procurement is advertised, according to the internal rules of EU Member States, in national official
journals or local newspapers or through a variety of procurement web sites. Therefore the fact that15% of EU procurement is published in the Official Journal of the EC should not be interpreted as
meaning that the remaining 85% is not being advertised at all.
There are several areas where traditionally there has been less competition. These have included
electricity, water and telecommunication services that are now opening up (as noted in paragraph 72)
to greater competition. Other areas where there is likely to be less cross border competition will besmaller (below threshold) construction services and certain health and social services.
According to a draft Directive presented by the EU, defense procurements, as well as procurements
under the harmonized thresholds defined in it (goods and services – 130,000 euros for central entity
and 200,000 euros for sub-central entities, public works – 5,300,000 euros) are not submitted to thecommitments agreed on that Directive. When procur ing by tender, do European entities direct those
procurements to local (national) suppliers? If a supp lier from another EU state becomes interested in
a tender not covered by the Directive, can it present its bid anyway? Would it be considered? Are
those excluding criteria the same in the EU Procurement Agreements with third parties? In the same
way European countries reserve a substantial market share for their local suppliers in the EUdirective, does the EU reserve any market share for their regional suppliers when negotiating with
third parties?
A: Under-the-threshold contracts are subjec t to the rules of the EC Treaty, notably:
- the national treatment principle;- the principle of non-discrimination;
- right of establishment;
- freedom to provide services.
Hence, a supplier from a country other than the contracting authority's country cannot be
discriminated against. The EC Directives foresee no provision reserving a market share for either their
local suppliers or their regional suppliers (see also reply to question 24).WT/TPR/M/102/Add.2
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(x) State-trading
Question from Japan:
Since the elimination of the import and export monopol y on Electricité de France, what is the volume
of electricity imports and exports by companies other than Electricité de France? In Italy, what is the
volume of the tobacco imports by companies other than the previous Import State Trading Enterprise
since the import monopoly was eliminated?
A: We will provide a written reply at a later stage.
(xi) Anti-dumping and countervailing measures
(a) Anti-dumping
Questions from Japan:
Japan notes that there exist cases where anti-dumping measures were arbitrarily used by the EU. For
example, in the case of components of television cameras, the European Commission initiated an anti-
dumping investigation on its own without sufficie nt evidence, and in the case of personal fax
machines, the EC attempted to expand the definition of the product during the re-examination. The
area of anti-dumping is an exception to the basic principles of the WTO, having, for example, a non-discriminatory principle and a principle that any one duty should not exceed the bound rate of a duty,
and thus should not be abused for protectionist purposes. Japan therefore requests that any future
investigation be conducted in a fair and objective manner.
A: The EC shares Japan's view that the antidumping instrument should not be abused for protectionist
purposes. However, we take issue with the implied allegation that the proceedings cited by Japan were
not conducted in a fair and objective manner and that measures were imposed "arbitrarily". Without
going into any detail with regard to individual cases which we view as being inappropriate in the
context of a trade policy review, we affirm that the measures were taken after thorough investigations
which were initiated on the basis of sufficient evidence in line with the applicable WTO rules and in
conformity with EC legislation
According to the report by the Secretariat, some  40% of anti-dumping investigations are terminated
without measures being taken. How does EU assess this figure?
A: For the year 2001, the EU initiated 28 investigations. During the same year, it terminated 12
investigations without imposing measures, i.e. 42,8%. Taken over the last three years (1999, 2000 and2001), the average of investigations terminated without measures amounts to 46,8%, i.e; 25,8% in
1999 (17 terminations against 66 initiations, 71,9% in 2000 (23 terminations against 32 initiations)
and 42,8% in 2001.
Furthermore, when anti-dumping investigation is initiated, the criteria set forth by the WTO Anti-
Dumping Agreement should be strictly applied. We would appreciate having the EU’s comment on
this issue.
A: We agree with Japan that the provisions of the WTO Antidumping Agreement with regard to
initiations, as well as all other provisions of this Agreement, should be strictly followed.
Questions from Taiwan:
We note that, as of 2001, the EU has 175, second largest number notified anti-dumping measures in
force, only behind that of the United States. Are there any plans to reduce the application of anti-WT/TPR/M/102/Add.2
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dumping measures? More than one third of 175 anti-dumping measures applied to only three
members and what is the rationale behind this ? Is  there anything the EU plans to do to improve this
imbalanced situation?
A: The fact that the EU has as of 2001 175 anti-dumping measures in force just reflects its position as
one of the biggest trading partners of most WTO Members. This in turn leads to an increased
exposure of the Community´s industries to unfair trade practices. The use of AD can not only bemeasured in terms of actual numbers of measures in force but has also to be considered in terms of
total value of imports concerned. On this basis the Community is an extremely moderate user of the
instrument.
In regard to the ruling concerning imports of Cotton-Type Bedlinnen from India we want to point out
that it only concerned this specific case. In decidi ng to accept applications for special reviews for all
cases where the same method of calculation was applied the Community went beyond the ruling. The
calculation method is explained in the disclosure to each concerned company so that they can apply
for review when they are qualified. In addition the Community has prepared a claims form which
should help companies to compile the necessary in formation. This should easily enable SMEs to
successfully apply for such reviews. It has to be underlined that an annual administrative reviewwould constitute a considerable burden for the exporting producers concerned.
The requirements for the application of interim re views are in full conformity with WTO rules.
According to these rules there is no legal time fra me. However all applications are generally treated
by the Community´s services as quickly as possible.
The reason for the significant increase in countervailing measures reflects the fact that an increased
number of subsidies not in conformity with WTO rules have been established by WTO Members. We
also note that the total number of CVDs has decreased again from 17 in 2000 to 16 in 2001.
In the case “European Communitie s - Anti-Dumping Duties on Imports of Cotton-Type Bed Linen
from India,” the Appellate Body ruled the zeroi ng practice was in violation of the Anti-Dumping
Agreement. The EU decided that all the cases impo sed anti-dumping duties as a result of the same
method could apply for special review.We welcome this action; however, as the EU investig ation authorities hold better knowledge on the
calculation methodology for every anti-dumpung case, we would like to suggest the EU undertake an
overall review without requiring the submission of applications.
A: The fact that the EU has as of 2001 175 anti-dumping measures in force just reflects its position as
one of the biggest trading partners of most WTO Members. This in turn leads to an increased
exposure of the Community´s industries to unfair trade practices. The use of AD can not only be
measured in terms of actual numbers of measures in force but has also to be considered in terms of
total value of imports concerned. On this basis the Community is an extremely moderate user of the
instrument.
We also note that requirements for the application of  interim review under the EU anti-dumping laws
are rather rigid. We would like to suggest the EU to consider the possibility of adopting annual
administrative review mechanism so that expor ters subject to anti-dumping duties have the
opportunity to adjust their dumping behavior to comp ly with the EU’s regulations. We consider this
situation will benefit both exporters and EU enterprises.
A: In regard to the ruling concerning imports of Cotton-Type Bedlinnen from India we want to point
out that it only concerned this specific case. In deciding to accept applications for special reviews for
all cases where the same method of calculation was applied the Community went beyond the ruling.
The calculation method is explained in the disclo sure to each concerned company so that they can
apply for review when they are qualified. In addition the Community has prepared a claims formWT/TPR/M/102/Add.2
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which should help companies to compile the necessary information. This should easily enable SMEs
to successfully apply for such reviews. It has to be underlined that an annual administrative review
would constitute a considerable burden for the exporting producers concerned.
Moreover, as there is no timeframe for EU authorities to respond after receiving an application of
interim review from exporters, applicants always face a very uncertain situation as to the possible
development of the applications concerned. For the sake of transparency, may we suggest that the EUconsider setting the timeframe in this regard, preferably using the 45 days rule as seen in the
initiation stage for the investigation.
A: The requirements for the application of interim reviews are in full conformity with WTO rules.
According to these rules there is no legal time frame. However all applications are generally treatedby the Community´s services as quickly as possible.
Question from Hong Kong, China:
The number of new AD cases initiated by EU continues to remain at a high level, with 28 new cases
initiated in 2001. Noting that the EU has under lined in the Government Report its interest in
preventing the misuse of trade defence instruments, we would like to know if the EU has any concrete
plans to introduce additional measures to prevent the abusive use of AD measures.
A: The EC reaffirms to Hong Kong that it has a strong interest to prevent the misuse of trade defence
instruments. In regard to additional measures to prevent the abusive use of AD measures we want to
point out that already the EU only takes measures after thourough investigations which were initiated
on the basis of sufficient evidence in line with the applicable WTO rules and in conformity with strictEC legislation. The Community even goes beyond WTO rules in requiring the Community interest
test before measures can be applied. The fact that the average of investigations over the last three
years which were terminated without measures amounts to 46,8% can be considered as proof of the
thoroughness of the EU`s methods and ways of conducting investigations and that everything is done
to prevent abuse. The Community does not apply antidumping measures in an abusive manner.
Question from Korea:
Korea was the third most frequent target of the EU’s anti-dumping measures in 2001 after the US and
China. Anti-dumping measures were imposed by the EU on 11 different item s from Korea. According
to the Secretariat Report, the Commission emphasiz ed that some 40% of anti-dumping investigations
are terminated without measures being taken. However,  from Korea’s perspective, the fact is evidence
that the investigation of anti-dum ping measures is being misused.
Considering that the investigation itself often dam ages the export company, more careful initiation of
antidumping measures is required. What is the view of the EU on this?
A: The EC shares Korea`s view that the antidumping instrument should not be abused for
protectionist purposes. However we reject the claim that investigations are being misused and affirm
that they are only initiated on the basis of sufficie nt evidence in line with the applicable WTO rules
and in conformity with strict EC legislation. Furthermore we point out that the Commission goes
beyond WTO rules in requiring the Community interest test before measures can be applied. The factthat 40% of investigations are terminated without any measures being taken can be considered as
proof of the thoroughness of investigations.
Questions from Brazil:
In relation to the implem entation of rulings adopted by the DSB in dispute settlement proceedings on
anti-dumping and countervailing measures imposed by  the EU, it is stated in the report by the
Secretariat (WT/TPR/S/102, p. 49) that “such ‘dis pute’ measures may be repealed or amended, orWT/TPR/M/102/Add.2
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other special measures may be adopted as appropriate to implement legal interpretations developed
in the ruling. However, there is to be no retroactive effect, as the EU has argued that DSB rulingshave only a prospective nature”.
Could the EU explain if, in case the “ruling” in dispute makes reference to, for instance, the
methodology for the calculation of the dumping ma rgin adopted in a particular investigation, whether
it would proceed to a review of the measure based on the evidence gathered in the course of that
investigation or whether the review of the adopted measure would be carried out based on theappropriate new evidence for a different period other than the one covered in the original
investigation?
A: Firstly the EC wishes to underline that the implementation of a recommendation by a
Panel/Appellate Body should be distinguished from  the subsequent review of such measures. When
implementing the findings of a Panel/Appellate B ody, for example with regard to the methodology
used for the dumping calculation, the EC may revi se the measures in question by correcting the
methodological error concerned on the basis of the data used for the original investigation. However,
the use of old data may not always be appropriate. Indeed, implementation of Panel/Appellate Body
rulings is often a complex task and in particular with regard to measures not subject toPanel/Appellate Body rulings, but which use the same methodology; it may be more appropriate to
collect a complete set of information for a more updated period.
About 40% of anti-dumping investigations ar e terminated without measures being taken
(WT/TPR/S/109 p.49). Could the EU indicate, with rega rd to those investigations, the percentage that
resulted in negative determination of dumping as well  as the percentage that resulted in negative
determination of injury?
As indicated in the same paragraph of the report by the Secretariat, “in cases where
measures are taken, a number of exporters from more than one WTO Member are generally
involved”. Could the EU indicate the percentage of investigations terminated without measures being
taken in which there were cases of accumulation of imports?
Could the EU indicate, for the period 1999-2001 , the percentage of “sunset reviews” which
have concluded with the decision against the extension of the measure?
A: The type of detailed statistical information requested by Brazil in these questions is not readily
available. However, should Brazil wish so, the EC is prepared to conduct an analysis and provide the
data requested by a later date.
Question from Chile:
En el párrafo 78 del Informe de la Secretaría de la OMC se indica que "un complemento del régimen
antidumping es la aplicación de las decisiones adoptadas por el OSD en los procedimientos de
solución de diferencias iniciados por terceros países en relación con medidas antidumping ycompensatorias impuestas por la UE", para luego indicar la posición de las Comunidades Europeas
en el sentido que las decisiones del Organo de Solución de Diferencias de la OMC tienen un carácter
exclusivamente prospectivo y, por lo tanto, no retroactivo. Esta afirmación sobre el carácter de
"complemento" ¿quiere decir que las Comunidades Europeas incorporan como política propia en
materia antidumping las decisiones del OSD sea en los casos en que han participado como parteinteresada, principal o tercero, o bien ello abarca incluso casos en los que no tienen un interés
directo?
A: While in a technical sense the ruling of a Panel/Appellate Body must only be implemented by the
party which legislation or practice was found to be incompatible with the WTO rules, nothing would
prevent other WTO members from adapting their own legislation or practice as a result of such ruling.
This may be appropriate in particular if a member considers that the findings of the Panel/AppellateWT/TPR/M/102/Add.2
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Body have a general scope and affect its own legislation or practice. However, it should be clear that
there is no legal obligation to do.
Question from India:
Para 27 of the Secretariat Report notes that EU is the second most frequent user of anti-dumping
measures. Moreover, they are also initiating anti-subsidy investigations, many times in conjunction
with the anti-dumping measure for the same product, against trading partners. It may be noted that itis not only the definitive anti-dumping/countervailing duties that affect the trade but even the rumour
of initiation of such an investigations affect the trade of the concerned country. Defending an anti-
dumping/countervailing investigation also involves heavy expenditure. There is ,therefore, an urgent
need to put in place a mechanism to safeguard the interest of developing countries in ensuring their
market access into the investigating countries. We would like to have EU’s comments on this issue.
A: The EC shares India’s view that the anti-d umping and anti-subsidy instruments should not be
abused for protectionist purposes. However, the EC wishes to underline in the strongest possible
terms that investigations are only initiated on th e basis of sufficient evidence in line with the
applicable WTO rules and in conformity with strict EC legislation.Furthermore we point out that the EC goes beyond WTO rules in requiring the Community interest
test before measures can be applied. The fact that 40% of investigations are terminated without any
measures being taken can be considered as proof of the thoroughness of investigations. The fact that
not every initiation automatically leads to anti-dumping measures is indeed in the very nature of the
investigation.
As regards India’s question to put in place a mechanism to safeguard the interest of developing
countries in ensuring market access into the invest igating countries, it is not clear what type of
mechanism is being referred to.
Moreover, it should be recalled that the current rules do not in any way prevent market access and are
in full compliance with the WTO rules.
India is concerned that the European Union is re sorting to anti-dumping measures without giving due
regard to obligations under Article 15 of the Agreement on implementation of Article VI of the GATT
1994, which requires special consideration to be given by developed countries to developing
countries, and constructive remedies being ex plored before applying anti-dumping duties on
developing country WTO members. India would like to know the number and percentage of cases
against exporters from developing countries in which the EU explored constructive remedies, natureof such remedies explored and the final outcome.
A: When considering the application of anti-dumping measures, the EC always gives special regard to
the situation of developing countries, in accordance with Article 15 of the Agreement on
Implementation of Article VI of the GATT 1994. It explores the possibility of constructive remediesbefore applying anti-dumping duties where they would affect the essential interests of developing
countries. To this end, the EC informs co-operating exporters in the disclosure letter of its willingness
to explore constructive remedies, including undertakings, and examines any remedy that may be
identified or offered. It should be noted, however, that, depending on the circumstances of the case, it
may in practice not be possible to accept an undertaking or other remedy, in particular in situationswhere monitoring of an undertaking is not feasible.
As regards statistical data, the EC confirms that, in accordance with its obligations as a WTO
member, it explores constructive remedies in all cases concerning developing countries where anti-
dumping duties are considered. Undertakings are the main type of remedy envisaged in this context.In addition, attention may be drawn to the fact that the imposition of a duty in a lesser amount than the
dumping margin should also be seen as constructive remedy. Therefore, developing countries benefit
from the general application of a lesser-duty-rule by the EC.WT/TPR/M/102/Add.2
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The WTO Anti-dumping/ SCM Agreements prescrib e guidelines for designating the ‘domestic
industry’. However, instances have been noticed wher ein the evaluation of the domestic industry for
injury purposes has been confined to those producers who supported the petition seeking initiation of
the investigation. In certain cases the injury analysis was conducted in respect of producers who
accounted for even less than 50% of the production of the like product. Recently, a WTO DSU panel
has held that an injury determination based on 53% of the domestic producers was not adequate. Werequest the EC to clarify how its injury determination based on an analysis of producers accounting
for less than 50% of the domestic production is in accordance with obligations under Article 4.1 of
the Anti-Dumping Agreement, 16.1 of the SCM Agreement and also the finding of the above
mentioned panel .
A: The EC determines the domestic industry for the purpose of the injury determination in accordance
with Article 4.1 of the Anti-Dumping Agreement and 16.1 of the SCM Agreement. According to this
provision, the term "domestic industry" refers to the domestic producers as a whole of the like
products or those of them whose collective output constitutes a major proportion of the total domestic
production. Producers which are related to exporters or importers or are themselves importers of theallegedly dumped products may, however, be excl uded from the notion of domestic industry.
The EC notes that the two aforementioned agreements do not contain an explicit definition as to what
constitutes a major proportion of the domestic industry. The EC would appreciate it if India specified
the Appellate Body report to which it referred in its question.
Would EU indicate the specific provisions in the WTO under which they resort to anti-absorption
proceedings?
A: As regards the anti-absorption procedure in the EC legislation, from the point of view of the WTO
rules, this procedure is only a form of review under Article 11.2 of the Anti-dumping Agreement,
whose object is to reassess the export price in accordance with Article 2 of the Anti-dumping
Agreement.
Would the EU indicate the percentage of anti-dum ping investigations initiated so far without a final
definitive duty being imposed against the target ed exporters? Would the EU also indicate the
initiation standards which it follows while examining the accuracy and adequacy of the evidence
provided to justify the initiation of an anti-dumping/ countervailing duty investigation in theapplication seeking initiation of such an investigation?
A: Around 40 % of the anti-dumping investigations initiated by the EU are terminated without any
measures being taken. Investigations are only initiated on the basis of sufficient evidence in line with
the applicable WTO rules and in conformity with strict EC legislation (Article 5 of Regulation (EC)No 384/96 of 22 December 1995).
Would the EU specify the circumstances in which it  uses the data for the amount of profit based on
export sales and not on domestic sales while constr ucting the normal value? In how many cases over
the past two years has the EU adopted such a methodology?
A: The information requested is not readily available and to obtain it would necessitate extensive
research. Moreover, it would appear that this question is linked to an ongoing investigation
concerning imports of a product originating in India. Under these circumstances, the EC is
unfortunately not in a position to reply to this question. The EC also notes that the parties concerned
by that investigation have ample opportunity to disc uss the issue in the framework of the investigation
in question.WT/TPR/M/102/Add.2
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Would the EU furnish details of any duty drawback scheme, which might be in place for remission of
customs duty on inputs used/ consumed in the production process for an exported product?
A: Inward processing allows imported raw material s or semi-manufactured goods to be processed for
re-export inside the Community by Community manufacturers without a requirement that the
manufacturers have to pay customs duty and VAT on the goods being used. There are two variants:
one allows the duty to be suspended, while under the other it is paid and later repaid.
Could EU explain the methodology followed by it in admitting the review app lications in AD cases,
with particular reference to those cases, which had previously been found by the DSB/Appellate
Bodies of the WTO to be inconsistent with the AD Agreement? How does EU justify the initiation of
review proceedings closely on the heels of adverse verdict in such cases by the Appellate body?
Would the EU clarify as to whether and how the text  of Article 11.3 of its ‘Basic AD Regulation’, by
permitting such request of review based on dumping margins that are ‘higher’ than those found in the
previous investigations, is consistent with the text of Article 11.2 of the Anti Dumping Agreement of
the WTO?
A: The question concerning the admissibility of review applications in cases which had previously
been found to be inconsistent with the Anti-dumping Agreement seems to concern an ongoing dispute
between India and the EC. We therefore refrain from commenting in detail.
In any event we note that the implementation of a recommendation by a Panel/Appellate Body is an
issue which does not preclude the subsequent review of such implementation measures. There is in
our view a fundamental distinction to be made between such implementation, on the one hand, andthe subsequent review of anti-dumping measures , on the other. From a methodological viewpoint,
there is no link between both concepts.
As concerns the procedure for the review of anti-dumping measures, the EC considers that nothing in
Article 11.2 of the Anti-dumping agreement indicates that this procedure is only allowed in view of a
reduction or abolishment of a duty. This view is also confirmed by the fact that in accordance withArticle 6.11 (iii) of the Anti-dumping agreement, the domestic industry is one of the interested parties
that can request such review.
Questions from Thailand:
Exports of pipe-fittings from Thailand to the European Union are subject to two trade defence
instruments applied by the EU, i.e. the ‘quantitative undertaking’ under the anti-dumping measure
and ‘tariff quotas’ under the provisional safeguard measure. In our opinion, the application of these
two remedial measures to the same products at th e same time can be considered ‘double protection.’
While it may be disputed that the two measures are applied to differing causes, no one could argue
that applying both at the same time is tantamount to remedying the same injury. Can the EuropeanUnion please clarify the rationale for the simultaneous application of these two measures to
Thailand’s pipe-fitting exports?
A: In the EC’s view, ‘double protection’ implies giving a higher level of protection to domestic
producers than is necessary through the simultaneous application of two or more trade defencemeasures.
At present, no safeguard additional duties are payable on pipe fittings subject to the EC provisional
safeguard measures. Safeguard additional duties are only payable on those imports to the Community
in excess of tariff quotas based on traditional imports plus 10%. The generous level of these tariff
quotas is reflected in the fact that, as at 15 July 2002 (more than half way through the duration of the
measures), only 27% of the tariff quota established for pipe-fittings had been utilised.WT/TPR/M/102/Add.2
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In the event that a situation arises in which double protection would in fact occur, the Commission has
undertaken to resolve the matter to ensure that domestic producers are not given a higher level ofprotection than is necessary.
In regard to the above question, we further would like to register our concern pertaining to the
provisional safeguard measure applied on steel import s. In our view, the EU’s provisional safeguard
measure and the initiation of an investigation is not justified on the grounds of: 1) increasedquantities, as the statistics on steel imports into the EU for the period 1999-2001 does not provide
clear evidence for the purported increase; 2) failure to ensure the existence of the causal link between
the injury and increased imports; and 3) the case for increased imports was not one of an unforeseen
development. We would appreciate clarification from  the European Union on the justification of the
measure.
A: The European Communities made considerable efforts to carry out detailed enquiries prior to the
imposition of provisional safeguard measures to ensure that it fully complied with the stringent
standards laid down in WTO rules. The investigation is currently ongoing to determine whether, for
each product, the provisional measures should be confirmed and whether definitive measures arerequired.
(1) The European Communities consider that there is clear evidence of an existing recent increase in
imports in relation to the fifteen steel products in respect of which provisional safeguard measures
have been adopted. Import data in relation to each product for the period 1997 to 2001 is provided in
Annex 1 to the regulation imposing provisional safeguard measures ((EC) No 560/2002).
(2) On the basis of its preliminary enquiries prior to the adoption of provisional measures, the
European Communities consider that there is a cl ear causal link between the injury which was found
to have occurred and the threat of serious injury, on the one hand, and increased imports on the other.
In particular, recitals (38) to (43) of regulation EC No 560/2002 set out the basis on which the
European Commission reached its preliminary determination that a causal link was established.
(3) On the basis of its preliminary enquiries prior to the adoption of provisional measures, the
European Communities consider that increased imports arose as a result of the increased use of tradedefence instruments by the US in the steel sector  in recent years culminating in the announcement of
US safeguard measures. In this regard, we note that whilst US imports of steel products fell by 33%
between 1998 and 2001, imports of steel products to the Community grew significantly. Recitals (12)
to (16) of Regulation (EC) No 560/2002 set out the unforeseen developments on which the
provisional measures are predicated in greater detail.
Question from China:
We believe trade remedies including the anti-dumping measures are legitimate only if they re
consistent to the WTO rules and conducive to fair trade and normal competition order. There are
some questionable aspects, as to the determination of market status in EU’s anti-dumping regime. We
would like EU to explain to the meeting the 5 criter ia utilized in the determination of market economy
status for enterprises of some WTO members, including China in AD investigation, in particular:
their justification under WTO Agreements and how to avoid discrimination and double standard in
their applications.
A: In accordance with Article 2 (7) of Regulation (EC) No 384/96 on protection against dumped
imports from countries non members of the Euro pean Community, as amended by Regulation No
905/98 of 27.4.1998, market economy status can be gr anted if it is shown, on the basis of properly
substantiated claims by one or more producers subject to the investigation that market economy
conditions prevail for this producer or producers. To this end the following criteria are used:
Decisions of firms regarding prices, costs and inputs, including for instance raw materials, cost of
technology and labour, output, sales and investment, are made in response to market signals reflectingWT/TPR/M/102/Add.2
Page 144
supply and demand, and without significant State interference in this regard, and costs of major inputs
substantially reflect market values,Firms have one clear set of basic accounting records which are independently audited in line with
international accounting standards and are applied for all purposes,
The production costs and financial situation of firms are not subject to significant distortions carried
over from the former non-market economy system, in particular in relation to depreciation of assets,
other write-offs, barter trade and payment via compensation of debts,The firms concerned are subject to bankruptcy and property laws which guarantee legal certainty and
stability for the operation of firms, and
Exchange rate conversions are carried out at the market rate.
These criteria are designed to establish a meaningful normal value in countries which have not yet
achieved a full market economy. If one or several of these criteria are not met, it is difficult to imaginehow normal value can be determined.
The methodology used by the EC is in accordance with paragraph 15 (a) of the Accession Protocol of
China.
(b) Countervailing measures
Question from Taiwan:
The report states a significant increase in countervailing measures in force from 6 cases in 1999 to 17
cases in 2000. We are concerned with this significant increase and would like to be advised of the
reason.
A: The reason for the significant increase in countervailing measures reflects the fact that an increased
number of subsidies not in conformity with WTO rules have been established by WTO Members. Wealso note that the total number of CVDs has decreased again from 17 in 2000 to 16 in 2001.
Questions from Brazil:
The Commission has proposed the adoption of a new instrument "to react against unfair competition
from subsidized third country airlines" (WT/ TPR/S/102, p. 49). Could the EU explain how this
proposal is compatible with Article XV of the GA TS, especially article XV.2 (“Any Member which
considers that it is adversely affected by a subsidy of another Member may request consultations with
that Member on such matters. Such requests shall be accorded sympathetic consideration.”)?
A: The respective paragraph cited by Brazil only relates to agricultural products. The EU does not
grant any export subsidies to industrial products and services.
In relation to the aforementioned proposal, the article “European Commission proposes legal means
to react against unfair competition from subsidized  third country”, published in the IP/02/394 (March
12th, 2002), presents the procedures foreseen in the draft regulation. However, that article does not
specify criteria for determining the existence of subsidy and the methodology for calculating its
amount and for determining the existence of injury . Could the EU present, in a preliminary basis,
which would be such criteria and methodology? Would there be a relation between the criteria and
methodology adopted in countervailing measures on  imports of goods and those being formulated for
air transport?
A: The EC considers that there is no contra diction between the proposed Council Regulation on
subsidised and unfairly priced airline services supplied from third countries and the defensive support
system in the area of shipbuilding. In fact, both are intended to counteract unfair trading practices
which have injurious effects on the domestic industry.WT/TPR/M/102/Add.2
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Question from India:
The EU trade protection proceedings frequently disregard the various procedural WTO norms. One
such instance is the violation of the Article 1 3.1 of the Agreement on Subsidies and Countervailing
Measures relating to pre-initiation consultations. We would request the EU to respond to this
concern.
A: The EU does not agree with this statement and does not consider to have violated Article 13.1
SCM Agreement in countervailing proceedings.
(2) M EASURES DIRECTLY AFFECTING EXPORTS
(i) Exports subsidies
Question from Canada:
Paragraph 89 states that in principle, the Community does not grant subsidies conditional uponexportation, except for those provided for under the CAP on alcohol and incorporated products, milk
and milk products, beef and veal, pigmeat, eggs, poultry meat, sugar and related products, wine,
cereals, rice, fruit and vegetables, and processed fruit and vegetables. Please explain how the EU
continues to justify trade-distorting export subsidies, and when and how does it plan on phasing these
out.
A: The EU is ready to negotiate further reduc tions on the condition that all forms of export
subsidisation (export credits, abuse of food aid, unfair practices of state trading enterprises) will be
disciplined. At this stage, we cannot be more specific on either the subsidy reduction percentage or
the implementation period. This will depend on the WTO negotiations.
Question from Argentina:
En el párrafo 89 se indica que las subvenciones a la exportación concedidas por la Unión Europea
tienen por objeto cubrir la diferencia entre precios internos y precios del mercado internacional, pues
de otra forma no sería posible exportar estos productos. ¿Qué medidas se están tomado para resolver
el dilema de no poder exportar sin subsidios, en particular en el contexto de la reforma de la PAC, y
tomando en cuenta el compromiso adoptado en Doha con relación a los subsidios a las exportaciones
de los productos agrícolas?
A: The EC has substantially reduced the use of export subsidies since 1995. Export subsidies are
becoming less and less significant, falling from 25% of the value of farm exports in 1992 to 5.2% in
2001. In 2001, export refund expenditure was EUR 2.763 billions.
Question from Uruguay:
Según el informe de la Secretaria se menciona que, según los datos mas recientes de que se dispone,
los reintegros por exportaciones ascendieron en 2000 a 4.200 millones de euros.
En Doha los gobiernos acordaron la reducci6n de todas las formas de subvenciones a la exportacióncon miras a su remoción progresiva, dado que la CE no ha presentado ninguna propuesta concreta a
la fecha, se agradecería conocer como se va a implementar to acordado por los Ministros en el
mandato de Doha.
A: Firstly, the EC has substantially reduced the use of export subsidies since 1995. Export subsidies
are becoming less and less significant, falling from 25% of the value of farm exports in 1992 to 5.2%
in 2001. In 2001, export refund expenditure was EUR 2.763 billions. On export subsidies, the EC
position is very clear, we say that we are ready to negotiate further reductions on the conditions that
all forms of export subsidisation will be disciplined.WT/TPR/M/102/Add.2
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(3) M EASURES DIRECTLY AFFECTING PRODUCTION AND TRADE
(i) Legal framework for business
Question from Canada:
Paragraph 99 states that the average rates of corpor ate taxation in the EU Member States continue to
differ significantly, with no sign of convergence during the period under review. Although the
Commission has long favoured harmo nization to reduce these differences, the Member States are not
unanimous on the issue; consequently, Commission action to date has focussed on enhanced
mechanisms for tax co-ordination, notably action to reduce or eliminate “harmful tax competition”.
Please indicate how the EU Member States inte nd to proceed to honour their commitment to the
OECD’s project on Harmful Tax Competition which requires them to eliminate their harmful tax
features by 2003.
A: According to the agreed timetable, OECD memb ers should eliminate the harmful features of their
harmful tax regimes by April 2003. In this respect, it has to be noted that the EU Member States - in a
parallel process internal to the EU (the Code of Conduct for Business Taxation, part of the Tax
Package) - have also made a commitment to elimin ate, in the framework of the Tax Package, the
harmful features of their harmful tax regimes already by the end of 2002, i.e. before the deadline in
the OECD work against harmful tax practices. As for how Member States intend to proceed in the
exercise, it is left to them to make sure that the timetable and the deadline are respected.
Question from Japan:
Japan is of the opinion that the Statute for a European Company (SE), adopted last year, should
admit the establishment of European  companies by merger or transformation, not only to publicly-
held companies, but also to those privately-held. Japan would also like to request the EU to simplify
the tax-related procedures for an SE under the Euro pean company law by allowing it to pay tax only
to the Member State where its headquarters is located, after duducting the profit and loss of all the
subsidiaries and branches which belong to the SE.
A: At present, the determination of the tax base for corporate taxation is not harmonised in the EU.
Member States can legislate at their wish in this area, provided that their internal legislation comply
with the EU Treaty relevant provisions and princi ples, with particular regard to non-discrimination.
Only two Directives are at present applicable in the EU with regard to corporate taxation: Directive
90/434/EEC on the common system of taxation applicable to mergers, divisions, transfers of assets
and exchanges of shares, and Directive 90/435/EEC on the common system of taxation applicable in
the case of parent companies and subsidiaries of different Member States. Both directives apply tothose companies which are listed in the related annexes, in which the European Company is not listed.
In this respect, the EU is working to ensure that both Directives become applicable to the European
Company. Moreover, The Commission strategy for company taxation presented in 2001 aims in the
long-term, amongst others, at simplfying tax-related procedures for companies, by allowing a
consolidated corporate tax base for their EU activities.
Question from the United States:
Please explain why the proposed Takeover Bids Directive was not agreed, and provide background
and details regarding the changes to the new version to be proposed and explain how this will ensure
its passage.
A: No decision has yet been taken regarding a new proposal on Take Over Bids.WT/TPR/M/102/Add.2
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Question from Brazil:
In document WT/TPR/S/102, paragraphs 93 and 94, it is stated that a company that does not have its
head office in the Community needs to present the requirement to demonstrate a “real and continuous
link with a Member State’s economy”. What is the definition of “real and continuous link”?
A: We would like to refer to the Advocat General's conclusions in the case C-18/93 of 9 November
1994 which gives relevant indications on how to interpret the criteria in Article 48 (ex. Art. 58) andwhich also refers to the notion of "real and continuous link".
(ii) Competition policy
Question from Japan:
Japan understands that the EU has received comment s from the European Automobile Manufacturers
Association (ACEA) on the new draft block-exemption regulation for motor-vehicle distribution and
servicing agreements. One example is that the new draft regulation will have the effect of diminishing
comforts enjoyed by car buyers, by hampering the appropriate geographical location of car dealers
and garages. The ACEA therefore requests that automobile manufacturers should be allowed to
control or limit the number and the distribution of service garages designated by automobile dealers.Japan would like to have the response and view of the EU regarding such requests.
A: Under EU law, distribution and servicing agreements in selective or exclusive distribution systems
are taken to be restrictive and are not considered to be in line with the competition rules unless they
have been "exempted" by the Commission. Th e Commission may exempt whole categories of
agreements in this manner. Car distribution and se rvicing agreements have had their own such "block
exemption" since 1985.
The Commission found in a November 2000 report that the last block exemption, number 1475/95
(please see our web site at http://europa.eu.int/comm/competition/car_sector/), had not had the
required effects, and notably had not brought the required benefits to the consumer, especially as
regards the Internal Market and the consumer's right to buy cars in other Member States. Much of the
problem was that the old regulation allowed car manufacturers to give territorial exclusivity todistributors operating within a selective distribution system; this let them carve up the Internal Market
along national lines.
The replacement for regulation 1475/95, adopted by the Commission on 17 July 2002, provides that
when they appoint car distributors, manufacturers can no longer combine quantitative selectivity with
a territorial element, such as an exclusive territory or a protected location ("location clause"). Thismeans that if a manufacturer wants to give his distributors an exclusive territory, he will be able to
stop them opening additional outlets, but will no longer be able to prevent them from selling cars to
independent resellers. If, on the other hand, he wants to stop sales to independent resellers, he will not
be able to use location clauses to prevent his authorised distributors from setting up additional outlets
in areas where other distributors are situated. However, in all cases, manufacturers will continue to beable to fix a location for a distributor's first outlet, and distributors will not simply be able to close
down this outlet and move elsewhere. This will allow carmakers to ensure that the density of their
networks is maintained.
As far as authorised repair-only outlets are concerned, the manufacturer will no longer be allowed to
limit the number of such outlets or restrict their location, and an authorised repairer will be able to setup shop wherever he wishes. By allowing repairer s to be authorised by the manufacturer without
having to sell new cars, the Commission has reinforced  the density of the authorised repair network in
two ways. Firstly, some repairers who are currently independent will choose to qualify as authorised
repairers. Secondly, some authorised dealers who have their contracts terminated when a car
manufacturer re-organises his sales network will be able to stay on within the repair network asWT/TPR/M/102/Add.2
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authorised repairers. This should ensure that co nsumers will continue to benefit from a dense network
of repairers.The Commission has given operators a three-year transition period to adapt to the ban on location
clauses in selective distribution agreements for the sale of new cars. A one-year transition period
applies to the other elements of the reform, including those relating to authorised repairers.
The new rules apply to all distributors, repairers, and car manufacturers operating in Europe.
The Commission had many fruitful contacts w ith both JAMA and ACEA during the consultation
period leading to the adoption of the new regime, and also had wide consultations with consumers and
consumer groups.
Questions from Costa Rica:
¿Qué cambios plantea la “nueva política aplicable a las restricciones verticales” que conlleva una
disminución en las investigaciones antimonopolio que llevó la Comisión en el 2001? (párrafo 100)
Se hace referencia al hecho de que las fusiones de carácter transnacional requieren una evaluación
de los organismos encargados del tema en los diferentes países sobre la base de distintas leyes y
prácticas en materia de competencia. ¿Se ha pensado adoptar una legislación integral a nivel de la
Unión Europea con el fin de promover la convergencia de las decisiones y las medidas correctoras eneste tema? (párrafo 102).
A: New block exemption regulation 2790 / 1999 OJ L336 of 29.12.1999 page 21 and Guidelines on
Vertical Restraints (OJ C291 of 13.10.2000) that are applicable since 1-6-2000 have lead to a
reduction in notifications as the new Block Exemption regulation covers a wider group of agreements.
Whilst the EU has not undertaken any formal harmonisation of the merger control laws of its Member
States, Member States have, in certain respects, unilaterally adapted their merger control legislation tothat of the EU. Moreover, a high level of convergence has been achieved between the decision
making practice of the European Commission and that  of the national competition authorities of its
Member States.
Con respecto a la política antimonopolio, el párrafo 104 establece que están prohibidos los acuerdos
que afectan al mercado común, con independencia de que las empresas estén establecidas en terceros
países. ¿Cómo se tratan este tipo de casos? ¿No conllevarían a una aplicación extraterritorial de la
legislación comunitaria? (párrafo 104)
A: Yes, this implies extraterritorial application of the EU rules, but only in as far as it deals with
effects of the anti-competitive arrangement within the EU. Such cases are enforced by dealing with
the companies' EU subsidiaries or activities.
Questions from Brazil:
The Commission is at the forefront of efforts to launch the “International Competition Network”
(ICN) in order to foster international cooper ation on competition policy (WT/TPR/S/102, p. 55). In
the EU’s assessment, how has this experience wor ked out so far? How does the EU envision the
relation between the ICN and a possible multilateral agreement on competition policy under the
WTO?
A: The EC has been at the forefront of the establishment of the ICN as well as negotiations in the
WTO on a framework agreement on competition. The EC considers the ICN initiative and a WTO
agreement as complementary in nature rather than  alternatives. The ICN is currenlty composed of
more than 65 competition agencies from countries which already have a domestic competition law
and enforcement authority. The EC notes in particular that the ICN is aimed at developing non-
binding best practices and guidelines for selected competition issues, and, more generally, fostering
mutual understanding of competition regimes. The ICN also closely cooperates with otherWT/TPR/M/102/Add.2
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international bodies working in the same field (such as WTO, UNCTAD and OECD), as well as
private sector representatives. On the other hand, negotiations in the WTO, set to start after the 5thMinisterial, would most likely focus on (i) reaching agreement on certain binding core principles to be
included in domestic competition laws; (ii) establishing inclusive modalities for international
cooperation among enforcement authorities; and (iii) ensuring an enhanced and better coordinated
approach to technical assistance and capacity-build ing. The EC remains firmly committed to bring the
process forward with regard to both the ICN and the WTO and is encouraged by the increase insuppport for both."
Could the EU assess its experience in the management of a supranational competition agency and in
its relation with the national authorities from member States? In the report by the Secretariat
(paragraph 111) it is stated that “competition po licy enforcement is to be shared more equally
between the Commission and national courts and competition policy authorities”. Is there any
possibility of conflict between the communitarian and national levels of jurisdiction? Is there any
possibility, in this mechanism, of judicial review  by member States? If so, how would this process
work?
A: Both under the current and under the future re gulation implementing the EC competition rules, the
Commission shares the responsibility of enforcing those rules with the national competition
authorities and the national courts. Where current practice shows that the Commission is the de facto
sole enforcer of EC competition rules, the new regulation stimulates enforcement at national level by
allowing national competition authorities and courts to apply the entirety of Articles 81 and 82 of the
Treaty, thus including Article 81(3).
Shared enforcement implies questions of coherent en forcement. In order to ensure coherence at the
level of the competition authorities, the implementing regulation provides for an exclusion of national
enforcement as soon as the Commission has opened proceedings. In the new implementation
regulation, this last resort coherence tool will be complemented by regular contacts between the
competition authorities within a network of Europe an competition authorities before any decision has
been taken.The opening of procedures by the Commission, however, does not stop a national court from dealing
with a case between two pr ivate parties under EC competition law. In order to avoid any conflicting
application of the latter law, a national judge may ask the Commission for assistance with regard to
factual issues or a (non-binding) interpretation of the applicable rules. In addition, the new regulation
will allow the Commission and national competition authorities to submit amicus curiae briefs to thenational court. The final and compulsory interpretation of the applicable rules is given by the
European Court of Justice, to which any national court may address a preliminary question.
Furthermore, the overall supremacy of Community law also contributes to enforcement coherence.
Indeed, the Court of Justice has confirmed that when  applying EC competition rules, neither national
competition authorities nor national courts may contradict a decision taken or envisaged by theCommission.
Conflict of application of EC competition rules is finally also avoided because of the non-binding
guidelines and notices on the application of the EC competition rules, issued by the Commission."
(iii) Subsidies
(a) Overview
Questions from Guatemala:
Párrafo 116: “Según la notificación de la Comisión, las donaciones constituyeron la forma principal
de ayuda estatal al sector manufacturero (el 61 por ciento), seguidas de las exenciones fiscales (el 22
por ciento)”WT/TPR/M/102/Add.2
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¿Podría la Unión Europea explicar en qué consisten las “donaciones” y las “exenciones fiscales”?
A: Grants and tax exemptions
The first category comprises aid that is transferred in full to the recipient and accounts for the vast
majority of aid in all Member States. This category may be subdivided into two groups depending on
whether the aid was granted through the budget or through the tax or social security system. Below is
a list of aid instruments where the aid element is equal to the capital value of aid.
• Grants
• Interest subsidies received directly by the recipient
• Tax credits and other tax measures, where the benefit is not dependent on having a tax 
liability (i.e. if the tax credit exceeds the tax due, the excess amount is repaid)
• Tax allowances, exemptions, and rate relieves where the benefit is dependent on having a tax 
liability.
• Reduction in social security contributions.
• Grant equivalents e.g. sale or rental of public  land or property at prices below market value
• http://europa.eu.int/comm/competition/state_ai d/scoreboard/conceptual_remarks.html#what_I
s
Párrafo 119: “En relación con la agricultura (capítulo IV 1), existen disciplinas en el marco del
Acuerdo sobre la Agricultura de la OMC y se deberá abordar su alcance en las negociaciones e
curso. En tanto que las asignaciones al sector han permanecido estables en la UE durante el período
que se examina, la Comunidad ha hecho constar su inquietud por el incremento de la asignación
presupuestaria de los Estados Unidos en la propuesta ley sobre la agricultura del 2002”
¿Cómo considera la Unión Europea que su tímida revi sión de la Política Agraria Común afectará el
desarrollo de una negociación tan importante cuando se espera un mejor balance en toda la
negociación para los países que dependen de su agricultura en especial los países en desarrollo?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
(b) State aid
Questions from the United States:
Please provide further general explanation on the exceptions that apply to certain defined
circumstances under the EU’s State aid rules.
A: In order to enable us to provide a useful an swer to this question we would need to get some
clarification. What is meant by "the exceptions that apply to certain defined circumstances under the
EU's State aid rules"? For example, does the US intend to refer to "Exceptions from the
incompatibility of aid" (Art. 87.2 and Art 87.3), to "Exceptional occurences under Art 87.2.b?", or to"Art 87 3 e (cf the reference to shipbuilding in Q 500)?
To which other sectors apart from Shipbuilding do the exceptions apply?A: Please see reply to question above.Question from Brazil:
The state aid granted by member states was € 82 billion in 2000, amounting to 0.99% of EU’s GDP.
Please specify how is this system of state aid compatible with the obligations incurred by the EU in
the WTO, notably the Agreement on Subsidies and Countervailing Measures?WT/TPR/M/102/Add.2
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A: State aid granted by EC Member States is in full compliance with the EC's WTO commitments,
including its obligations under the WTO Agreement on Subsidies and Countervailing Measures. ECstate aid rules do not allow for the granting of export or import substitution subsidies which are
prohibited under these rules. Additionally, it should be noted that state aid is increasingly provided on
a horizontal basis without being targeted at any specific sector.
(c) Selected sectoral developments
Question from Korea:
The EU decided on June 27 that it will resume subsidies to its shipbuilding industry unless a bilateral
agreement can be concluded by September 30 of this year. The decision is regrettable since it
prejudices the outcome of the bilateral consultations and it was made even before the WTO panel
decision on this issue.From Korea’s perspective, the EU’s subsidy scheme will distort the fair trade system as it will be
provided to a specific industry and companies. Fu rthermore, it will have a negative impact on the
competitiveness of the EU economy itself.
What is the view of the EU on this ?
A: In the Commission’s view, the Council decision taken on June 27 to adopt the Regulation
concerning a temporary defensive mechanism to shipbuilding can in no way be seen as prejudicing
the outcome of the bilateral consultations. On the contrary, it should conduct to speed up the
conclusion of a mutual satisfactory solution before the end of September in order to avoid the
introduction of the temporary defensive mechanism. However while the EU has made it clear that it is
ready to resume talks with the Korean government, Korea has not yet replied to the Commission’s
invitation. If Korea decides not to come to the ne gotiating table, the EC will have no choice but to
speed up the WTO procedure.
It should also be emphasised that the temporary defensive mechanism is a clearly focused measure,
limited in time and scope, to defend those EU yards which are suffering most from unfair Korean
competition. It cannot be compared to general operating aid, which has been prohibited since the
beginning of 2001. Moreover, the maximum allowable aid level of 6% will only help yards to alimited extent to win orders against Korean competition for the shiptypes in question.
Furthermore, in the Commission’s view, the proposal is fully compatible with WTO rules. Subsidies,
provided that they are not prohibited or are not demonstrated to cause "adverse effects", are legitimate
national policy instruments, as far as the WTO is concerned. In granting the aid to its domestic
producers, the EC is not suspending any concessions or obligations towards Korea. Therefore, the EChas the right to grant aid to its shipbuilders and, in fact, has done so for many years up to 31
December 2000.
Questions from the United States:
Are there plans to make additional details public of the terms and conditions of Member State
participation in development of the Airbus A-380?
A: The EU has provided the US with inform ation foreseen under the 1992 EU/US Bilateral
Agreement on Trade in Civil Aircraft. The Commission has no further detail available as regards such
supports in the framework of competition policy .
What is the latest list of EU countries participa ting in the development of the Airbus A380 and which
of these intend to provide "reimbursable" loans as financing support?WT/TPR/M/102/Add.2
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A: The EU has provided the US with the info rmation foreseen under the 1992 EU/US Bilateral
Agreement on Trade in Large Civil Aircraft. The Commission has no further detail available asregards such supports.
Question from Brazil:
The EU has decided to continue the existing fram ework for state aid in the air transport sector in
order to “react against unfair competition from subsidized third country airlines” (WT/TPR/S/102, p.60). In another sector, the Commission has concluded that the depressed state of prices for ships was
due to the low prices offered by shipyards in the Republic of Korea, and has decided to adopt a
“defensive” system of support for certain types of ship for the duration of the WTO proceedings
(WT/TPR/S/102, p. 63). Is there not a contradiction between these facts and the purpose of
strengthening the multilateral trading rules, in the context of the EU’s trade policy?
A: The EU considers that there is no contra diction between the proposed Council Regulation on
subsidised and unfairly priced airline services supplied from third countries and the defensive support
system in the area of shipbuilding. In fact, both are intended to counteract unfair trading practices
which have injurious effects on the domestic industry. We also refer to the reply given to Korea onshipbuilding.
(iv) Intellectual propert y rights protection
(a) Overview
Questions from Canada:
Paragraph 134 mentions that in November 2000, the Commission suggested a harmonizing directive
on enforcement of Intellectual Property Rights (I PRs) to go beyond the “minimalist approach” of the
TRIPS Agreement, which is to be presented in the course of 2002. Please state the elements of the
harmonizing directive and how EU Member States en sure the consistency in the enforcement of the
TRIPS Agreement. The great variation in seizures by the Member States (table III.1 on page 26)
raises questions of consistency.
A: The Communication from the Commission dated 30 November 2000 sets out an Action Plan which
includes, as a priority, the submission of a proposal for a Directive aimed at strengthening the means
for enforcing intellectual property rights and defining a general framework for the exchange of
information and administrative cooperation. This draft proposal is under preparation and it is hoped
that it will be presented to the Commission for adoption in the Autumn of 2002.
Paragraph 135 states, “In the TRIPS Council, the EU has sought establishment of a multilateral
system for the notification and registration of geographical indications for wines and spirits, in
accordance with Article 23.4 of the TRIPS Agreement, with a possible extension to other products
(e.g., cheese). The Doha Ministerial Declaration provides for the negotiation of a system for winesand spirits, while the TRIPS Council could take up the issue of other products.”
Please explain the process and the criteria used to evaluate the eligibility and selection of product for
protection as a geographical indication. What mechanisms are used to prevent the establishment of
protected geographical indications from becoming a disguised barrier to trade?
A: The WTO regime of protection of geographical indications ("GIs") is based on the principle of
territoriality and, hence, in the recognition and protection of a geographical indication in the country
of origin. The EU proposal for a multilateral system of notification and registration (the "multilateral
register") fully acknowleges this principle and proposes that only GIs protected in the country of
origin be registrable at the WTO level. The product scope of such multilateral register will be decidedWT/TPR/M/102/Add.2
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by the WTO membership in due course. For the time being, the Doha Ministerial Declaration provides
for a product scope limited to GIs for wines and spirits.  Those GIs, in the EU, have to meet the criteria
of Article 22.1 of the TRIPs Agreement. Evidence supporting that those requirements (i.e. a link
between a certain quality, reputation and other characteristic and a territory) are met varies from case
to case and may encompass, as a way of example, chemical and other scientific evidence proving that,
e.g., that the protected quality bears a link with the territory.
Finally, protected GIs as any other intellectual property right (the TRIPs recognizes many others likepatents, trademarks or designs), is, by definition, not a "disquised barrier to trade". Intellectual
property rights (IPRs) protect and reward creativity , investment and goodwill that is incorporated in
tradeable product. International protection of GIs, like that of any other IPR, ensures that free flow of
those goods is not curtailed and that the creativity, invesment and goodwill is preserved for those who
undertook it. The multilateral register, as proposed by the EU, seeks to ensure that that internationalprotection, as envisioned by the TRIPs Agreement, is facilitated and made easier for right-holders,
consumer organizations and public administrations alike.
Questions from Japan:
It is noted that no consensus was reached in the Council on the Commission's proposal to create a
"Community Patent", a new unitary right, including a "Community Intellectual Property Court" for
its enforcement. Please explain the reason why no consensus was reached and what the future
prospects are for establishing a Community Patent, including a Community Intellectual Property
Court.
A: Discussions within the Council have so far not been ripe for agreement. The discussions continue
with a view of reaching agreement which must be taken by unanimity.
According to the customs authorities, it is repor ted that the volume of importation of products
infringing intellectual property right has increased in the EU. With regard to breeder’s rights, please
indicate the estimated quantity and value of infringe d goods having been imported into the EU and
the amount of goods seized by the customs authori ties. According to our information, the regulation to
minimize the infringement of patent, etc., is provided in document, (EC) 241/1999. Please explain
what measures have been taken with regard to plant breeder’s rights-related materials.
A: At the moment, there are no Community wide statistics on the quantity and value of infringing
goods imported into the EU as regards plant breeder’s rights. The lack of such information is due tothe fact that the enforcement of this right has not yet been harmonised and it is therefore enforced
according to the legislation of the Member States in  accordance with their international obligations.
However, feasibility studies have been carried ou t in the Community with a view to extending the
scope of Council Regulation No 3295/94 (laying down measures to prohibit the release for free
circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods) tocover also plant breeder’s rights. In the light of these studies, such an extension is currently under
consideration in the EU.
Please provide information on the contents of anti-piracy measures taken by the EU or each Member
State.
A: In 1998, the Commission issued a Green Paper on combating counterfeiting and piracy in the
single market (COM(98)569) in order to determine the economic impact of this phenomenon, to
assess the effectiveness of the applicable legislation and to suggest approaches with a view to
improving the situation. As a follow-up to this Green Paper, the Commission adopted in 2000 a
Communication containing an action plan which contains several measures against counterfeiting and
piracy (COM(2000)789). This action plan includes, for example, a proposal for a Directive aimed atWT/TPR/M/102/Add.2
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strengthening the means for enforc ing intellectual property rights, training for officials of law
enforcement authorities as well as public information and awareness activities. The aim of this actionplan is to supplement existing measures for checking counterfeit and pirated goods at the external
borders of the EU (see Council Regulation No 3295/94 and Council Regulation No 241/99).
Please provide information on the possible contents of the future directive on enforcement, which is
now under consideration in the EU.
A: The aim of this Directive will be to harmonise the level of enforcement of intellectual property
rights in the Member States by using best practice models. This Directive will address issues such as
provisional judicial measures, damages and the right of information.
Please provide information on the counter-measures, taken by the EU or each Member State, against
copyright infringement on cyberspace, such as the introduction of software to exchange files.
A: Community legislation on the protection of intellectual property rights is in general neutral as
regards the technology used by the person comm itting the infringing act. However, the recently
adopted Directive 2001/29 on certain aspects of copyright and related rights in the Information
Society and also Directive 2000/31 on electronic commerce respectively contain provisions on the
protection against the circumvention of technological  measures and rights management information as
well as provide for notice and take-down procedures under specific circumstances.
Please provide information on the status of intr oducting an electronic rights management system,
such as VERDI and INDENCS in the EU.
A: The EU and its Member States support various private sector initiated and driven projects in the
policy areas covered by the WTO Agreements. However, in general, these projects either have no or
only an incidental connection with the official tr ade policy of the EU and/or its Member States.
As far as the two above-mentioned projects are concerned, we do not have any information onINDENCS. The online licensing project VERDI was completed in 2001 and resulted in a prototype
for an online information and licensing system. It is understood that the continuation of this project
depends on several issues, i.e. the view of different copyright organisations and the funding it will
receive.
Questions from Taiwan:
Please advise us of the major points in the “Harmonizing Directive on Enforcement of IPRs”.
A: A draft proposal is still under discussion wi thin the Commission. The proposal for a Directive
should be presented by the Commission in the Autumn 2002. It is therefore much too early to giveprecise information on the content of this future proposal. However, the Commission described the
outline of its future proposal in its follow- up Communication to the Green Paper on Combating
Counterfeiting and Piracy in the Single Market which was adopted on 30.11.2000 (COM(2000)789
final). The text of this Communication is available at the following address:
http://europa.eu.int/comm/internal_market/en/indpro p/piracy/counterf.htm. The aim of this proposal
will be twofold: 1) to harmonise the laws of the EU Member States on the means of enforcing
intellectual property rights, including measures and procedures on searching, seizure and evidence;
and 2) to establish a framework for administrative co-operation and the exchange of information
between the Member States. Furthermore, this proposal should not in principle contain provisions
harmonising criminal sanctions as such. This issue could be examined by the Commission in the
medium term.WT/TPR/M/102/Add.2
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Please advise us of the legislation status regarding the incorporation of the Copyright Treaty and the
Performances and Phonograms Treaty under the World Intellectual Property Organization into theEU’s legal framework.
A: As regards the future prospects concerning the WCT and WPPT treaties, the Community and its
Member States has yet to ratify both treaties. The implementation by the Member States of the
Directive 2001/29 would enable the ratification. EU is optimistic that this would happen during 2003.
Questions from Australia:
“Geographical indications”
How many geographical indications are protected in the EU for:
(a) EU member state wine products?
A: Around 4200 geographical indications.
(b) EU member state spirit products?
A: Some 204 geographical indications.(c) EU member state products other than wines and spirits?A: Some 570.(d) Non-EU WTO member wine products?A: EU provides TRIPs +, "ex officio" type of protection to a "few hundred" of geographical
indications recognized as such in South Africa, Australia, Chile and Switzerland. (See Annex of thesebilateral agreements.). All third country GIs on wines and spirits have access to the level of protection
that Article 23 of the TRIPs Agreement prescribes that must be made available to "interested parties"
(e.g., right-holders of geographical indications) of any WTO member. Such level and efficient
enforcement is fully available through our court procedures via Regulation 1493/99 and is left to
right-holders. Regulation 1493/99 provides with legal grounds to any WTO member on any GI (be itfor a third country or from the EU) to invoke that "the description and presentation of the products
(…), and any form of advertising for such products, must not be incorrect (…) even if the information
is used in translation or with a reference to the actual provenance or with additions such as "kind",
"type", "style", "imitation", "brand"  or the like."
15 Consequently, in the EC, any WTO GI right-holder
can invoke this provision before any court or tribunal and effectively protect its GI. Regulation1493/99 applies to all wines, be them EU or third country wines, and, under EU law, is directly
applicable by all national courts and tribunals. As wines in the EU cannot be used in the course of
trade unless in conformity with Regulation 1493/99, the purpose of Article 23.1 of the TRIPs
Agreement, that is, to provide the legal means to forbid the use of GI on wine for another wine, is
fully met.In addition, Regulation 1493/99 provides that "Member States shall take all necessary measures to
enable interested parties to prevent, on the terms set out in Articles 23 and 24 of the Agreement on
Trade-Related Aspects of Intellectual Property Rights, the use in the Community of a geographical
indication attached to the products referred to in Article 1(2)(b) for products not originating in the
                                                     
15 See Articles 47 and 48 of Regulation 1493/99WT/TPR/M/102/Add.2
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place indicated by the geographical indication16 in question, even where the true origin of the goods is
indicated or the geographical indication is used in translation or accompanied by expressions such as"kind", "type", "style", "imitation" or the like."
17 Similar provisions exist for other wines products and
spirits.18 Those provisions, while imposing an obligation on the EU Member States, can also be
invoked before national courts directly.
(e) Non-EU WTO member spirit products?A: See above. Please note that specific bilateral agreements on spirits have also been concluded with
Mexico and the United States.
(f) Non-EU WTO member products other than wine and spirits?A: No bilateral agreements concerning geographical indications on those products have been
concluded to date. Having said this, All GI right-holders from any WTO member can access the
baseline level of protection prescribed by the EU Member States legislation on unfair competition. In
addition, certain types of products also have seen that type of protection enacted. To give an example,for geographical indications on foodstuffs, Directive 2000/13/EC of the European Parliament and of
the Council of 20  March 2000 on the approximation of the laws of the Member States relating to the
labeling, presentation and advertising of foodstuffs provides (Article 2) that:
" The labeling and methods used must not:
(a) be such as could mislead the purchaser to a material degree, particularly:
(i) as to the characteristics of the foodstuff and, in particular, as to its nature, identity, properties,
composition, quantity, durability, origin or provenance, method of manufacture or production; only an
indication of the manufacturer, packager or seller."
This provision can be invoked according to the implementation carried out by each EU Member State,
or, in the alternative, directly to national courts.
Are additional geographical indications protected/pr otectable at EU member state level? What are
these?
A: See response above. For example, how would a geographical indication for a textile product or a
handicraft product be protected in the EU? Via th e Member States general unfair competition laws
and any specific labeling laws that may be applicable.
                                                     
16 Article 50.2 of EC Regulation 1493/99.
2. For the purposes of this Article, geographical indications is taken to mean indications which
identify a product as originating in the territory of a third country which is a member of the World
Trade Organisation or in a region or locality within that territory, in cases where a certain quality,
reputation or other given characteristic of the product may be attributed essentially to thatgeographical place of origin.
17 Article 50 of EC Regulation 1493/99
18 See Regulation (EC) No 3378/94 of the European  Parliament and of the Council of 22 December
1994 amending Regulation (EEC) No 1576/89 laying down general rules on the definition,description and presentation of spirit drinks and Regulation (EEC) No 1601/91 laying down general
rules on the definition, description and presentation of aromatized wines, aromatized wine-based
drinks and aromatized wine-product cocktails foll owing the Uruguay Round of the multilateral trade
negotiationsWT/TPR/M/102/Add.2
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EU Regulation 2081/92 applies to foodstuffs and agr icultural products, Regulation 1493/99 applies to
wine geographical indications. How are geographical indications for other products protected in theEU?
A: See response above.For example, how would a geographical indication for a textile product or a handicraft product be
protected in the EU?
A: Via the Member States general unfair competition laws and any specific labeling laws that may be
applicable.
Is Regulation 2081/92 the only mechanism for protecting non wine and spirit geographical
indications in the EU?
A: No, see above.
What other laws are relevant?
A: See above.Are there laws which regulate unfair competition or consumer protection that would also been
applicable?
A: Yes, see above.
How can Australian producers obtain informat ion from the EU concerning protection of an
Australian geographical indication?
A: By contacting the relevant Commission or Member States relevant services. This information is
publicly available in www.europa.eu.int . It is up to Australia to assess the validity of its GI under Art.
22.1 Trips.
How can Australian producers apply for protection of an Australian geographical indication in the
EU?
A: Generally before national courts via the mechanisms that provide TRIPs protection as described
above, Australian producers can invoke the protection of the pre-TRIPs bilateral wine agreement that
contains provisions on the protection of geographical indications.On request, the Commission is prepared to reply to questions with regard to wine name protection
during the forthcoming EC/Australia negotiations on  the outstanding issues of the 1994 EC/Australia
Wine Agreement. Because of this Agreement, and following several rounds of wine negotiations the
Commission has had with them since 1994, the Australians should be well informed about our system
of wine name protection.
Current Commission proposal to amend Reg 2081/92Has this proposal to amend EU Reg 2081/92 entered into force? If not, what is the process and timing
for entry into force of this proposed amendment?WT/TPR/M/102/Add.2
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A: No. It is uncertain, given that it is a proposal of the Commission for a Council Regulation
amending Regulation 2081/92 and there is no definite time frame  for the adoption of these proposals.
This Commission proposal seeks to exclude “mineral and spring waters” from protection. Please
provide further details on the justification for refusing to protect these products from geographical
indication protection under the Regulation? Can geographical indications for such products attain
protection through other EU laws for the protection of geographical indications? If not, how does theEU justify excluding this product sector from the scope of geographical indication protection given
that Article 22.1 of the TRIPS Agreement refers  to “goods”? Could a non-EU WTO member obtain
protection for a geographical indication for a mineral water product in the EU? How?
A: A general finding that minerals waters’ are adequately regulated on an ongoing basis by Council
Directive 80/777/EEC of 15 July 1980 on the approxi mation of the Member States relating to the
exploitation and marketing of national mineral waters. Consequently, and in order to ensure coherence
with the afore mentioned directive, the EU Co mmission has proposed that names on EU mineral
water should no longer be registered under regulation 2081/92. The TRIPs Agreement does not oblige
any WTO member to protect its own GIs; Foreign GIs, including those for mineral waters, can be
protected via the unfair competition laws of the EU Member States; Third country GI are protected as
prescribed by the TRIPS as explained above. Yet, the TRIPs do not require any WTO member to
protect its own GI or to recognize any specific GI on any specific product.
Please confirm that geographical indications from a third country WTO Member can only be
protected via the mechanism set out in Article 12? Article 12 and paragraph 9 of the preamble
provides that the geographical indications of a WTO member can only be protected where thatcountry establishes that it meets certain “equivalence conditions” and on the basis of “reciprocity” –
please you confirm that these requirements apply to WTO members? How does the Commission
determine that “equivalence conditions are met” an d what is meant by “reciprocity”? Please clarify
the “right to objection” as contained in the Regulation?
A: We cannot confirm this. As explained above, third country geographical indications are protected
as prescribed by the TRIPs via a variety of means. TRIPs + protection as provided under Regulation
2081/92 can be accessed via bilateral agreements or via registration if certain requirements are met .
These requirements apply to any third country, irrespective of a WTO membership;
Verifying "equivalence" entails an overall examination of the legal framework (laws, regulations,enforcement mechanisms, etc..) in order to ascertai n that the level of protection available in a third
country is similar to that available under Regulation 2081/92, which, in any event, goes beyond what
is required by the Trips Agreement; Reciprocity means third countries who meet equivalence
conditions and who are willing to protect EU’s GI at the same level as EU members states do; The
right of objection means that any WTO member or any national can object to a registration of a EU GIthat coincides or detrimentally affects, for example,  an existing GI in a third country that meets the
conditions of equivalence or any WTO member without any conditions. In so doing, unlawful
registration as EU GI’s of WTO members’ GI is prevented.
What countries have met this requirement of “equivalence” and “reciprocity”? What information
would a country need to provide to meet these conditions?
A: As this possibility is a proposal articles 12a) to 12d) has never being applied. A country need to
provide the information explained above.
How does the EU reconcile the requirement for “equivalence” with the national treatment
requirement of the TRIPS?WT/TPR/M/102/Add.2
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A: Nationals of WTO members can apply for a Eur opean GI exactly under the same conditions as EU
national. Again, article 3 of the TRIPs apply to "nationals" and not to "goods" or "GI" or "IPR.
The new Article 12a procedure appears to require the “third country” to determine that the
requirements of the Regulation are satisfied before an application is transmitted to the Commission.
Does this mean that Australia would need to make a determination that an Australian geographical
indication, including the Australian legal framework for protecting that geographical indication,meets the requirements of European law before transmitting an application?
A: This provision solely means that the necessary documentation is adequately provided. The
determination of the conditions of protection is done under the same conditions as for the applications
from EU member States the Commission shall verify whether the registration application includes allthe particulars provided for in the Regulation
The new Article 12b provides that the Commission will make a determination as to whether the
application from a third country meets the “conditio ns for protection”. Could the EU please clarify
what these “conditions of protection” are and explain how these are consistent with the Part II:Section 3 of the TRIPS Agreement.
A: On the same kind of ground as for applications from EU member states meeting the regulation’s
requirements
On what grounds can the Commission decide to reject an application from a third country under
Article 12b(b). On what grounds can a person with a “legitimate concern” object to the publicationof an application for registration? What would amount to a “legitimate concern”?
A: When for example "the owner of a trade mark who markets their products in the EU for more than
five years preceding the date of the first publication, etc. objects, that can be considered as a person
with a legitimate concern".
What is the difference between the “legitimate conc ern” that a person must demonstrate to object to
an application as provided for in Article 12.b.2 and a “legitimate economic concern” as the ground
for a national of a WTO Member to consult an application under Article 12.d.1?
A: Legitimate concern is a close but wider concept than legitimate economic concern.
To utilise the opposition procedures set out in the new Article 12b and 12d an application for
opposition “must be demonstrated in regard to the territory of the Member States”. What does this
mean? How would an applicant for opposition from a non-EU member state demonstrate thisrequirement?
A: The objection is examined in regard to the te rritory of the Community because it’s the territory
where the geographical indications and designations of origin for agricultural products and foodstuffs
envisaged in regulation 2081/92 has been created as intellectual and property right and it’s where theyare applied. So if a trademark is marketed in the EU for a significant period of time (at least 5 years
before first publication), and a entirely or partly identical IG is applied, the owner of the trademark
concerned is entitled to object. The owner of a tr ade mark who markets their products in the EU for
more than five years preceding the date of the first publication, etc. can easily proved that they have
been selling their products for years".WT/TPR/M/102/Add.2
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Regulation 2081/92
Article 3(3) of Reg 2081/92 provides that the Council shall draw up a list of the names of agricultural
products and foodstuffs which are considered to be generic and thus not registrable under the
Regulation. Has this list been published? If yes, where? If not, why not?
A: This list has never been enacted into law for reasons pertaining to the legislative procedure. The
original Commission proposal was made in 1996 (COM(96) 38 Final).
Article 7(40) provides that a statement of objection will be admissible if it demonstrates that the
proposed name would “jeopardise the existence of an entirely or partly identical name or mark”.
What does “jeopardise the existence of” mean? Have there been any cases on which registration hasbeen denied on this ground? How do you reconcile this ground of objection with the provisions of
Part II Section 3 of TRIPS?
A: Jeopardize the existence of" means to risk harming the identical or similar name or mark; None; In
the absence of more precise information, there is no apparent contradiction between these provisionsand the TRIPs Agreement and, hence, no need to reconcile both sets of provisions
Question from Costa Rica:
En el párrafo 134 del Informe de la Secretaría se indica que en el curso del año 2002 la Comisión
presentará una directiva para armonizar la observancia de los Derechos de Propiedad Intelectual a
fin de avanzar más allá del “enfoque minimalista” del Acuerdo sobre los ADPIC. Por favor sírvanse
describir en detalle en qué consistirá dicha directiva, sus principales elementos y características,niveles de las sanciones y acciones penales (entre otros) y aproximadamente en qué fecha tienen
previsto que se presente la misma. (párrafo 134)
A: As regards the Directive on enforcement of IPRs, a draft is still under discussion within the
Commission. The proposal for a Directive should be presented by the Commission in the Autumn2002. It is therefore much too early to give precise information on the content of this future proposal.
However, the Commission described the outline of its future proposal in its follow-up Communication
to the Green Paper on Combating Counterfeiting and Piracy in the Single Market which was adopted
on 30.11.2000 (COM(2000)789 final). The text of this Communication is available at the following
address:http://europa.eu.int/comm/internal_m arket/en/indprop/piracy/counterf.htm.
The aim of this proposal will be twofold: 1) to harmonise the laws of the EU Member States on the
means of enforcing intellectual property rights, including measures and procedures on searching,
seizure and evidence; and 2) to establish a fr amework for administrative co-operation and the
exchange of information between
 the Member States. Furthermore, this proposal should not in
principle contain provisions harmonising criminal sa nctions as such. This issue could be examined by
the Commission in the medium term.
Questions from the United States:
Please provide examples of geographical indications or appellations of origin of foreign countries
recognized and protected by EU legislation.
A: Adelaïde, Hunter valley (Australia), Atacama,  Valle del Maipo (Chile), Klein Karoo, Swellendam
(South Africa), Valai (Switzerland).
Please explain how ex officio protection is provided for foreign geographical indications.WT/TPR/M/102/Add.2
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A: The ex-officio protection for foreign geographical indication it will be provided in the context of
the equivalency provided in article 12 of Regulation 2081/92. In the wine and spirits sectors, the ex-officio protection is ensured, in particular, by customs authorities, anti-fraud bodies.
If bilateral negotiations are required in order to obtain the type of protection already available to the
GIs of EU Member States, please explain why such negotiations are a prerequisite to GI protection
for foreign GIs?
A: Bilateral negotiations are not required but the recognition of equivalency of legislations.Please provide the mailing address and name of contact person(s) for deposit of GI applications from
WTO Members outside the EU. If it is necessary to file a GI application in a particular EU MemberState in order to seek EU-wide protection for a foreign GI, please provide all the relevant
contact/mailing address information.
A: The mailing address is the Commission official address stating the object of the application.
Article 10 of Regulation (EEC) No. 2081/92 still requires that, in order to obtain protection in the
EU, third countries must have in place an inspectio n and enforcement system that mirrors that of the
EU. The requirement for such a sy stem of inspection and enforcement is a prerequisite for obtaining
geographical indication protection in the EU. Please  explain how the unilateral imposition of the EU
system on WTO Members who are not EU Member Stat es is consistent with the EU ’s obligations
under the TRIPs Agreement.
A: The recognition of equivalency requires an equivalent control system.
Article 11 of Regulation (EEC) 2081/92 permits "any Member State" to proffer to the EU a "duly
substantiated application" challenging a GI registration. Please explain the procedure, pursuant to
Article 11 of Regulation (EEC) No. 2081/92, by which a national of a third country may challenge anexisting GI registration.
A: The aim of article 11 is to reinforce the control between member states and the respect of the
legislation. In the context of equivalency a similar situation would be possible to decide wit the thirds
countries.
Please explain the procedure, pursuant to Arti cle 11 of Regulation (EEC) No. 2081/92, by which a
WTO Member that is not an EU Member State may challenge an existing GI registration.
A: The same procedure than above but only for third countries for which an equivalency have been
recognised is to be established in the context of equivalency.
If is not possible for a third-country national, or a WTO Member that is not an EC Member State to
challenge a GI registered in the EU, please explain how this is consistent with the EU’s obligations
under the TRIPs Agreement.
A: Yes, it is possible as explained above.What are the conditions of a bilateral agreement with the EU necessary to obtain Article 22-level
protection of third-country GIs in the EU, for goods other than wines and spirits?WT/TPR/M/102/Add.2
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A: Article 22 level of protection, for third countries GI in the EU for goods other than wines and
spirits, is already in application since the entry of application of WTO agreement via the unfaircompetition laws of member states.
What are the conditions of a bilateral agreement with the EU necessary to obtain Article 22-level
protection of third-country GIs in the EU, for wines and spirits?
A: Idem as reply No 511.
(b) Patents
Question from Taiwan:
Please advise us of the development on the est ablishment of “Community Patent” and “Community
Intellectual Property Court”. We would also like to be provided with the legislation status of
“computer-implemented inventions”.
A: A proposal for a Community patent regulation has been tabled by the Commission on 1 August
2000. After a first reading of the proposal the Council has concentrated discussions on the mainpolitical issues which are: The language regime for the grant of Community patents (extent of
translations into EC languages), the relationssh ip between the Community patent and the European
Patent Convention (necessary amendments to the EPC), the role of the European Patent Office and
National Patent Offices (suncontracting), financial agreements (distribution of renewal fees) and the
jurisdictional arrangements. No final decision on theses issues has ben taken so far. Discussions in the
Council have shown that a decision can only be made on all the subjects combined. The Council
therefore will concentrate on what has appeared to be the crucial question from among those listedabove: the jurisdictional arrangements. On this subject the Commision will shortly table a detailed
Commission working document on the planned Community patent jurisdiction.
The proposal for a directive on the patentability of computer-implemented inventions was adopted by
the Commission on 20 February 2002. It seeks to ha rmonise the way in which inventions which make
use of computer software are handled under patent law. Perhaps 15% of all patent applications nowfall into this category. The overall approach of the proposal is to follow EPO practice and
jurisprudence, according to which such inventions are patentable provided they make a so-called
"technical contribution". Non-technical inventions, especially business methods, but also methods
involving simple data processing are not and will not be patentable. This approach resolves some
technical divergences in practice which have arisen between member states and will set limits onpossible future development of jurisprudence, but do es not represent any major change overall in the
current legal situation. The legal basis of the proposal requires the agreement of the European
Parliament and of the member states (qualified majority) in a co-decision process. Discussions are
under way in the Council experts group and in Parliamentary committees. A Hearing is planned for
early October in the Parliament’s Legal Affairs and Internal Market Committee. It is hoped that acommon position can be achieved by the November Competitiveness Council.
Question from Korea:
Please provide detailed information on the “Community Patent” regulation including the date of
effect of the new regulation.
A: The draft regulation is still under discussion within the Council of the European Communities.Question from Costa Rica:
El párrafo 138 del Informe de la Secretaría, referido al tema de Patentes, hace referencia al
procedimiento unitario de protección a las obtenciones vegetales disponible en la OficinaWT/TPR/M/102/Add.2
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Comunitaria de Obtenciones Vegetales. ¿Esta prot ección comunitaria a las obtenciones vegetales es
idéntica a la protección comunitaria otorgada a las patentes? De no ser así, ¿cuáles son susprincipales diferencias? (párrafo 138)
A: A Community Plant Variety Right is an intellectual property right, like a patent, but designed for
plant varieties of which material is produced and commercialised. The Community Plant Variety
Office (CPVO), operating since 27 April 1995, implements and applies this scheme (see Regulation(EC) No 2100 of 27 July 1994, OJ L 227 of 01/09 /1994, pp. 1 - 30). Object of Community plant
variety rights can be varieties of all botanical genera and species, including, inter alia, hybrids
between genera or species. Community plant variety rights shall be granted for varieties that are
(a) distinct;
(b) uniform;(c) stable; and
(d) new.
Moreover, the variety must be designated by a denomination.
A holder of a CPVR is entitled to effect certain acts in relation to the protected variety. Others
wishing to effect those acts must firstly obtain the authorisation of the holder, who may attachconditions and limitations to this authorisation. The acts in question are
(a) production or reproduction (multiplication);
(b) conditioning for the purpose of propagation;
(c) offering for sale;
(d) selling or other marketing;
(e) exporting from the Community;
(f) importing to the Community;(g) stocking for any of the purposes mentioned under points (a) to (f).
Questions from Brazil:
In document WT/TPR/S/102/ it is stated that the European Commission has proposed to harmonize its
legislation on software patents. Article 10 of the TRIPs Agreement establishes that computer
programs shall be protected as literary works under the Berne Convention. Isn’t there some degree of
inconsistency between certain EU members’ legislation and the TRIPs agreement?
A: The Community and its Member States already protect computer programs as literary works and
have done so since 1992 even prior to the adoption of the TRIPS Agreement. The relevant measure isCouncil Directive 91/250 on the legal protection of computer programs. There is no inconsistency
between protecting computer programs as literary works and harmonising practice as regards the
patentability of inventions which are implemented wholly or partially through the execution of
computer software, as the specific subject matter of what is protectable under copyright law would be
different from that of patent law.
There is a project in the European Union to create and develop a Communitarian patent system. Does
it mean the European Union considers the international harmonization of national patent laws to be
feasible as a rule? Is there any European interest in supporting initiatives for the creation of an
international patent? If not, what would be the EU’s difficulties with accepting an internationalpatent?
A: The EU is currently working on the establishment of a Community patent system. The Community
patent, a unitary title of law valid in all MS, would be enforceable before a Community patent
jurisdiction which would decide on infringement and invalidity actions and have a Community wide
effect. However, such a system would not be concerned with the harmonisation of the national patent
laws of EU Member States but would rather create a supra national patent within the legal frameworkWT/TPR/M/102/Add.2
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of the EU. Accordingly, the work on the Community  patent system is not linked to any project
designed to achieve an international harmonisation of patent law.Nevertheless, the EU does support the work curr ently being done under the auspices of WIPO.  The
EU is involved in the PCT reform process, as we ll as in the negotiations on the SPLT (Substantive
Patent Law Treaty). These exercises could in the future lead to a new patent law architecture.
(c) Copyright and neighbouring rights
Questions from Japan:
Japan welcomes the adoption of the Directive on the harmonisation of certain aspects of copyright
and related rights in the information society. It is mentioned that this legislation has the objective to
implement the EU's inte rnational obligations under the WCT and WPPT. Please explain the status
quo and future prospects of the EU's accession to the WCT and WPPT.
A: Member states of the EU should implement th e Directive 2001/29 on the harmonisation of certain
aspects of copyright and related rights in the information society before 22 December 2002. Since this
deadline has not yet been reached, Member States are still in the process of transposing the provisions
of the Directive into national law.As regards the future prospects concerning the WCT and WPPT treaties, the Community and its
member states has yet to ratify both treaties. The implementation by the member states of the
Directive 2001/29 would enable the ratification. EU is optimistic that this would happen during 2003.
Please explain the reason why there is no provision in the EU directives regarding the moral right of
performers, which is ensured by an obligation under the WPPT. Please explain to what extent each
Member State ensures the moral right of performers.
A: The moral rights of authors and performers is an area which has not been harmonised at
Community level. The moral rights of rightholders is exercised according to the legislation of the
Member States in conformity of their international obligations. Each Member State in order to ratify
the WPPT has to ensure that it provides moral rights for performers.
Please provide information on the provisions of domestic law in each Member State with regard to
“the right of making available” under Article 3 of the Directive. If there is no clear provision, please
explain how one can ensure “the right of making available” in each Member State, and further clarify
whether or not these conditions are consistent with the WCT or the WPPT.
A: Member States of the European Union are still in the process of implementing the Directive on the
harmonisation of certain aspects of copyright and related rights in the information society. Recitals
24-26 of the Directive provide interpretative guidance for the implementation of the article 3
paragraph 2.
To Article 5, paragraph 1 of the Directive: Please provide information on concrete cases exempted
from the right of re-production in accordance with this Article.
A: Member States of the European Union are still in the process of implementing the Directive on the
harmonisation of certain aspects of copyright and related rights in the information society. Since the
implementation deadline has not yet been reached nor the Directive been enforced in practice, there is
no case law on the interpretation of individual provisions of the Directive.
Please provide the meaning in detail of “independent economic significance” in paragraph 1,
Article 5 of the Directive.WT/TPR/M/102/Add.2
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A: Recitals 32 and 33 of the Directive provide interpretative guidance for the implementation of the
article 5 paragraph 1.
To Article 6 of the Directive: Please clarify whether or not this Article obliges Member States to
regulate both the circumvention of technological measures and the production or distribution of
circumvention machines or programs.
Please clarify whether or not this Article applies to the program which enables the
circumvention of technological measures.
Please explain the meaning of “a limited commercially significant purpose or use other than
to circumvention”, mentioned in paragraph 2 (b), Article 6 of the Directive (e.g. please clarify
whether or not this provision applies to copy-guard cancellers including watches).
Please clarify whether or not this Article obliges Member States to provide adequate legal
protection against the decoding of the scrambling of  TV programs. If so, please explain the reason
why such a strict obligation has been set, as it means that the Directive shall pose a stricter obligation
on Member States than the obligation of technical me asures under Article 11 of the WCT or Article 18
of the WPPT.
A: In general terms, article 6 provides legal protection against the circumvention of technological
measures designed to prevent non-authorised acts and against trade in devices, products or
components which are primarily meant for the circumvention. If for example a computer program
were to fulfil the detailed conditions under article 6 paragraph 2, Member States should provide legal
protection against its manufacture, import, distribution, sale, rental, advertisement for sale or rental, or
possession for commercial purposes.
Please provide information on the registration syst ems of copyrights if such a system has been
enforced in Member States.
A: Systems for registration of copyrights has not been introduced in the European Union.
Question from Taiwan:
Please advise us of the legislation status of “resale right” on the work of art.
A: The resale right is currently provided for by the domestic legislation of a majority of Member
States. Harmonisation of the resale right is provided for by the recently adopted Directive 2001/84 onresale right. According to the article 12 of the Di rective, Member States shall bring their laws and
regulations in compliance with this Directive before 1 January 2006, with implementation of certain
provisions delayed until 2010 or 2012.
Question from Brazil:
Paragraph 147 of the same document (Secretariat’s report)  is about resale rights of authors of resold
works of art. A European Directive recognizes this right for as long as the copyright protection period
lasts for the whole life of the author plus seventy years, should there be any heirs. The EU claims it is
the only big art market to recognize that right and states its intention to work for international
recognition of resale rights in order to ensure a level playing field in the art market. In Brazil, Law9.610 also recognizes the rights over resale, but only insofar as it relates to an increase in the price of
a work of art. Has the EU considered other countries’ legislation before stating its interest in making
that discipline universal? Should the answer be in the affirmative, which points have been considered
inadequate in other countries’ legislation in relation to the European Directive?
A: The artist's resale right is recognised in Article 14ter of the Berne Convention for the Protection of
Literary and Artistic Works as a non-obligatory author's right. In order to put forward a proposal for aWT/TPR/M/102/Add.2
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Directive on the resale right for the benefit of the author of an original work of art, the European
Commission made an analysis, both economic and legal, of the art market affected by the artist'sresale right. This analysis took into consideration not only the Community but also the world art
market. The Commission found that more than 60 countries outside the EU recognise the artist's
resale right, at least in principle. It seems approp riate to reflect on the means to extend the resale right
also to other countries and to make it obligatory under the Berne Convention. The Directive on the
artist's resale right envisages in its Article 7(1) th e possibility to grant the resale right to authors who
are nationals of third countries based on reciprocity.
IV. DEVELOPMENTS IN SELECTED SECTORS
(1) A GRICULTURE
(i) Main characteristics
Question from Canada :
Paragraph 29 of the Government report states that the EU position, based on Article 20 of the
Agreement on Agriculture (AoA), takes into account the need to aim at a balance between trade
concerns (market access, export competition, domestic support) and non-trade concerns (the
protection of the environment, the sustained vitality of rural communities, food safety, and other
consumer concerns including animal welfare), which reflect important societal goals.Please explain how the EU plans to identify and measure any incremental production costs associated
with animal welfare standards. How does the EU plan on preventing government-subsidized animal
welfare standards from becoming trade-distorting or  from relying on mechanisms that distort trade?
Please explain why the EU does not keep non-trade concerns like animal welfare outside the realm of
a trade body such as the WTO, and why it does not choose instead a more appropriate standard-setting body such as the OIE (Organisation Internationale des Epizooties).
A: Animal welfare, which is an increasing societal goal in Europe as in other countries, entails
additional costs that may justify legitimate comp ensation for farmers. The EC propose different
options to address such a non-trade concern issue: 1) the development of multilateral agreements, 2)
appropriate labelling rules, and 3) exemption of the compensation of additional costs or income
foregone to meet animal welfare standards, from reduction commitments. All of these options arecumulative and not exclusive.
Question from Guatemala :
Párrafo 4: La UE es autosuficiente respecto de la mayoría de los productos agropecuarios sujetos a
la Política Agrícola Común (PAC). Los niveles de autosuficiencia (producción interna dividida por elconsumo) más altos se logran con respecto de la leche entera en polvo (370 por ciento), seguida de la
leche desnatada en polvo (247 por ciento), el azúcar (128 por ciento)...”
A: Ratio total production/internal consumption is at 110% and varies acccording different products:
cheese (104%), whole milkpowder (250%) and skimmed milk powder (133%).
Question from the United States:
The EU claims to be the largest importer of ag ricultural goods from developing countries. What
percentage of these imports are comprised of value-added goods?
A: In the period 1997-1999, the EC imported an average of US $ 35,5 billion of agricultural products
(WTO definition) from developing countries. This is more than the US, Japan, canada, Australia, and
New Zealand did together. There is no definition at the WTO level which permits to distinguish basicWT/TPR/M/102/Add.2
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agricultural products from processed products or value-added products. Consequently, it is not
possible to give an answer to your question concerning value-added goods.
(ii) Common Agricultural Policy (CAP)
Questions from Canada:
Paragraph states, “The EU has also been an active participant in the negotiations under Article 20 ofthe WTO Agreement on Agriculture to continue the reform process in the sector. These negotiations
began in March 2000 and are now part of the DDA.”
The July 10, 2002 proposal from the European Commi ssion suggests a new form of farm income
payments that the EC claims will meet the criteria of Annex 2 of the Agreement on Agriculture (green
box). On what specific basis can such a claim be made? For example, what policy-specific criteria of
Annex 2 are these payments intended to meet? On what grounds would these payments meet the
fundamental requirements that they have no, or at most minimal, trade-distorting effects or effects on
production?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
The proposal intends to transform payments currently claimed as “blue box” support (Article 6.5)
into payments claimed under Annex 2. In view of this proposed change, what is the continued
rationale for the EU position in ongoing WTO negotiations of seeking to maintain the concept of the
“blue box” (see G/AG/NG/W/90)?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Question from Guatemala :
¿Cómo piensa la Unión Europea reorientar su Polí tica Agrícola Común para hacerla consistente con
los objetivos de negociación mandados en la Declaración Ministerial de Doha?
A: The Agenda 2000 reform of the CAP is perfectly compatible with the objectives of the Doha
Ministerial Declaration.
Questions from New Zealand :
We welcome the recognition by the EC of the importance of further liberalisation in the agricultural
sector for sustained and continued economic growth  (Secretariat report, paras 45, 46; EC report,
paras 29, 41, 42). We also welcome the empha sis in the CAP Mid Term Review proposals on
decoupling support from production. What is the EC  assessment of the implications of the MTR
proposals for movement of EC domestic support be tween the amber, blue and the green boxes? We
note that neither export subsidies nor market access were addressed in the MTR – even though both
are integral to the Community’s agricultural policy. How does the EC intend to further reform these
two pillars?
A: As MTR is a Commission proposal and thus not a EC measure, it is not appropriate to respond in
this context. As regards export subsidies, the EC is ready to negotiate further reductions on the
condition that all forms of export subsidisation (export credits, abuse of food aid, unfair practices of
state trading enterprises) will be disciplined. Moreover, the EC objective is to increase market access
to the benefit of all Members.WT/TPR/M/102/Add.2
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We are disappointed to note the EC remains a major user of export subsidies in the dairy sector (1.68
billion euro in 1999-2000 – Secretariat report, page 72, para 10). The Secretariat report also notesthe EC’s export refunds in this sector have crowded out unsubsidised trade (page 76, para 30). Given
the highly trade-distorting system in place and th e EC’s support for trade liberalisation in the WTO,
what consideration is the EC giving to accele rating “Agenda 2000” dairy sector reforms? While we
are pleased to note the Mid-Term Review proposals include four options being considered for the milk
quota regime, could the EC explain the relative weight being placed on each option?
A: The Commission presents four options without indicative preference and it would have to be
discussed by the Member States in the followin g months. Anticipation of Agenda 2000 dairy sector
reform is not included in these options. Overall, as  Ministers have not adopted MTR proposal, it is not
appropriate to be discussed in this context.
Questions from Japan :
With regard to the mid-term review of the Common Agriculture Policy (CAP), we understand that a
reform plan, aimed at decoupling direct payments fr om production and linking payments more closely
to food safety/quality, rural development and envir onment, is now under discussion. We would like to
ask the EC what are the prospects for discussion on this reform plan.
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
As far as new acceding countries are concerned, will all the commitments made by the EC in the
previous and current WTO negotiations be applied to these countries once accepted as members? Ifthere exist any moratoriums, as indicated in the case of progressivity to agricultural domestic
support, a detailed explanation on the matter would be appreciated.
A: The EC will respect all its WTO commitments, before and after accession of new Member States.
Question from Taiwan :
Table IV.2: Please explain the legislative schedule of “Directive on Insider Dealing and Market
Manipulation” and “Takeover Bids Directive”, whic h we understand are expected to be promulgated
in the latter part of 2002 and 2003 respectively.
A: Regarding the Directive on Insider Dealing and Market Manipulation, discussions are continuing
between the institutions involved. Agreement is expected by the end of the year. No decision has yet
been taken regarding the Takeover Bids Directive.
Questions from Australia :
The CAP mid-term review proposal gives little indication that the EU is interested in improvements in
market access for agricultural products. If the mid-te rm review proposal is intended to be the EU’s
blueprint for negotiations, how does the EU intend to fulfil the commitment made in the Doha
Declaration to negotiate “substantial improvements  in market access”? Over the past three years the
EU has regularly underfilled its quotas on a large range of agricultural products. This has beenbrought to the attention of the EU by various WTO members in every session of the COA. How does
the EU plan to rectify this?
A: As MTR is a proposal from Commission and not EC measures, it is not appropriate to respond in
this context. As regards TRQs, the EC has alread y provided all the necessary information on licensing
and other import requirements on agricultural products to the WTO CoA.WT/TPR/M/102/Add.2
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Domestic support
The detail of CAP reform proposals with respect to domestic support remains unclear. How willsubsidies be genuinely de-coupled? Will they be set in a non-changing and historic base period?
A: The question refers to the Mid-term review which is not a common EU policy yet.In what non trade distorting manner are the EU’s non-trade objectives to be reached?A: Non-trade concerns measures should be well targeted, transparent and implemented in no more
than minimally trade-distorting ways .
How does the EU intend to commit to “substantial reductions” in trade-distorting domestic support
through its commitments – particularly when Blue Box payments have arguably been trade
distorting?
A: Blue box payments have proven to be less trad e-distorting than market price support and than
payments based on output or on variable input use. The Ec therefore proposes that the concept of theblue box should be maintained.
Will CAP budget cuts be more than minimal particularly given pressures of enlargement?A: All informations about budgetary effects on the CAP of the elargment process can be found in the
Communication of the Commission (30 January 2002) SEC(2002) 102 final.
Does classifying payments as Blue and Green Box simply give the EU more scope to increase Amber
Box support?
A: The reduction commitments in trade distorting domestic support to be agreed in the current
negotiations make it difficult if not impossible to increase Amber box support even if direct paymentskeep on being exempted.
The EU land set aside percentage initially set at 15% of crop area has been reduced over time. How
is the EU planning to strengthen its production limits to ensure that the Blue Box measures are
genuinely less trade distorting than Amber Box?
A: Due to limitations on areas and yields, blue box payments have been fould by OECD as less trade-
distorting than market price support and than pa yments based on output or on variable input use.
Implementation of crop payments, in practice, has depended on the individual farmer’s planting
decisions, even if the EU’s budgetary payments for particular regions have been based on fixed area
and yield. This seems little different in practice to a per unit subsidy. How is the EU planning to
discipline fixed area and yield concepts?
A: In the context of the MTR, the EC is proposing to change current blue payments into decoupled
payments for the majority of products.
Export subsidies
The EU has agreed to negotiations aimed at phasing out export subsidies. We note the CAP mid-term
review proposal makes a direct link between genuine cuts in surpluses and the resulting reduced need
for export subsidies. What is the EU’s policy direction on this? What are the export volumes and
levels of export subsidy provided in 2001 for alcohol and incorporated products, milk and milkWT/TPR/M/102/Add.2
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products, beef and veal, pigmeat, eggs, poultry meat, sugar and related products, wine, cereals, fruit
and vegetables and processed fruit and vegetables?
A: On export subsidies, the EC is clear, we say that we are ready to negotiate further reductions on the
conditions that all forms of export subsidisation will be disciplined. Figures related to the 2000/2001
campaign have been submitted to the WTO a nd are available under no tification G/AG/N/EEC/36.  The
Commission of the European Communities is now working on the preparation of the notificationrelated to the campaign 2001/2002. As soon as the figures are available, the EC would submit to the
WTO a new notification on exports subsidies.
Questions from Argentina :
En el párrafo 42 del Informe del Gobierno (WT/ TPR/G/102), la UE afirma que la Conferencia
Ministerial de Doha confirmo el "compromiso de negociar el acceso a los mercados, la ayuda interna
y todas las formas de subvenciones a la exportación". Sin embargo, omite el grado para llevar estos
compromisos a cabo, ya que en la Declaración de Doha establece el compromiso de celebrar
negociaciones encaminadas a lograr: mejoras sustanciales del acceso a los mercados, reducciones de
todas formas de subvenciones a la exportación, con miras a su remoción progresiva y reduccionessustanciales de la ayuda interna causante de distorsión al comercio.
Por favor, podría explicar cuáles de las reformas de la Agenda 2000 y las consideraciones
recientemente plasmadas en el proyecto de revisi ón intermedia (mid-term review) avanzan en lograr
una mejora sustancial en acceso a los mercados.
A: With respect to MTR, as those are proposals from Commission and not EC measures, it is not
appropriate to respond in this context. With re gard to Agenda 2000, it has enabled the EC to move
away to a significant extent from price support towards direct payments, and substantially reduce the
use of export refunds.
En el mismo sentido, por favor podría indicar qué otras medidas serán tomadas a fin de lograr una
reducción sustancial de la ayuda interna distorsionante, teniendo en cuenta que en el proyecto derevisión intermedia de la reforma de la Política Agrícola Común (PAC), la reducción en los niveles
de apoyo representa tan sólo un 0,4% de los desembolsos de la PAC.
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
En la Declaración Ministerial de Doha se afirma que "tendrán en cuenta las preocupaciones no
comerciales" en la negociaciones agrícolas de la Ronda. Asimismo, en el párrafo 42 del Informe del
Gobierno (WT/TPR/G/102), la UE afirma que de la Conferencia Ministerial de Doha, se reconoce
"claramente la naturaleza multifuncional" del sector agrícola. ¿Podría la UE indicar si ladenominada "multifuncionalidad" a la cual la UE se refiere corresponde a las mencionadas
preocupaciones no comerciales?
A: There is no contradiction between multifuncti onality and non-trade concerns (NTCs). The concept
is part of NTCs. Multifunctionality that agriculture provides more goods than the production of foodand fibre, it contributes to the vitality of rural areas and to the protection of the environment. Non-
trade concerns include these concerns and others, like the consumer information, food safety and
animal welfare, which are legitimate concerns of the consumers over how food is produced. In
addition, non-trade concerns are not at all in contradiction with further trade liberalisation and should
not be deemed as disguised means of protectionism. For example, the EC only deems that producers
respecting higher standards should be legitimately compensated for additional costs due to the
protection of animals welfare.WT/TPR/M/102/Add.2
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En la página 91 párrafo 13 del Informe de la Secretaría se indica que en enero de 2002 la Comisión
propuso la financiación de 10 nuevos Miembros a partir del 2004, mediante la introducciónprogresiva de pagos directos. ¿Qué tipos de medi das van a financiar esos pagos? ¿Serán medidas de
caja verde? ¿Podría la Unión Europea brindar alguna información sobre el particular?
A: As no decision has been taken, it is premature to respond to this question.
Las consideraciones de la reforma de la PAC indican una marcada reorientación hacia la
agricultura sustentable, amigable con el medio ambiente, basadas en normas de calidad (alimentos
orgánicos) y en la que los productores agropecuarios estarían más expuestos a las señales del
mercado. Esto llevaría a una posible merma en su producción interna. Por favor podría indicar qué
recomendaciones específicas existen en materia de mejorar el acceso a los mercados a fin desatisfacer la eventual demanda insatisfecha.
Se adjunta como Anexo I a este documento preguntas específicas relacionadas con la Revisión de
Mediano Plazo de la Política Agrícola Común.
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Apoyo doméstico
¿Podría la UE especificar qué cereales reciben pagos directos realizados en el marco de programas
de limitación de la producción (artículo 6.5 del Acuerdo sobre la Agricultura)? Adicionalmente
¿Podría la UE indicar cuál es el monto de apoyo que se ha dedicado anualmente, desde 1995 en
adelante, en el marco de los pagos cubiertos por el artículo 6.5 del Acuerdo sobre la Agricultura acada sector y cada una de los demás productos básicos específicos?
A: Please consult the normal Commitee on Agricultu re report. This question has already been raised
by Argentina in June 2001.
¿Podría la UE indicar cuál fue el monto de apoyo otorgado a cada cereal y cada uno de los demás
productos básicos específicos durante la campaña de comercialización de 1992?
A: Please consult the normal Commiteee on Agricult ure report. This question has already been raised
by Argentina in June 2001.
Reforma de la Política Común:
MTR-CAP Mid Term Review (MTR)
of the Common
Agricultural Policy
(CAP)COM(2002)394Questions for TPRM
Cereals Compensation for the
reduction in the
intervention priceWhat amount of compensation is envisaged?
Would this compensation be in EUR per hectare, or per tonne or other basis?
Cereals Negotiations on border
protectionCould you provide the quantities and value of each cereal, including rice,
imported from each origin as from the agricultural year 1994/1995 until2001/2002?
Rye Abolition of intervention
priceCan you confirm that no specific compensation is being proposed for rye
producers?
Durum wheat Overcompensation of
producersCould you estimate the amount of overcompensation?
Which were the main crops affected by overcompensation?
Which were the reasons for this overcompensation?
Table (cont'd)WT/TPR/M/102/Add.2
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MTR-CAP Mid Term Review (MTR)
of the Common
Agricultural Policy(CAP)
COM(2002)394Questions for TPRM
Durum wheat Reduction of supplements
per hectare compensatory
payments to EUR 250/ha.for traditional areasCould you inform how many hectares received this payment as from 1992/93 to
2001/2002?
What are the objective reasons for a differentiation between traditional and nontraditional areas or regions?
Durum wheat Abolition of supplements
per hectare compensatory
payments for non-traditional regionsCould you inform how many hectares received this payment as from 1992/93 to
2001/2002?
Durum wheat Specific premium for the
producer of EUR 15 pertonne sold to the
processing industry under
quality criteria contractsThis premium could function as an incentive for the processing industry for buying
domestic durum wheat impairing or nullifying market-access commitments
Oilseeds No specific measure
envisagedCould you inform the areas and production of oilseed crops as from the marketing
year 94/95?
Could you inform the production and export of vegetable oils during the sameperiod?
Rice Reduction of intervention
price to EUR 150 with asafety net intervention
price of EUR 120.
The reduction ofintervention price is
intended for enabling rice
imports form developingcountries benefiting from
the EBA scheme.Which is the difference of intervention price and "safety net intervention price"?
Any additional rice imports will take place only through the EBA scheme?
Rice Compensation for the
intervention price
reduction:
EUR 75 for crop specificaid.
EUR 102 for farm income
payment.Would you confirm that these proposed direct payments are payments under art.
6.5 of the AoA (exempt payments)?
If so, could you explain how would they meet the production limiting criteria of
art. 6.5?
Dried Fodder Reduction in the non-
exempt direct paymentsCould you inform the quantities of dried fodder produced in the EU as from 94/95
marketing year?
Nuts Replace of the actual
arrangement by a flat rate
of EUR 100/haCould you describe the actual arrangement and how has it been notified to the
Committee on Agriculture?
Beef Replacement of headage
payments with single
income payments per farmbased on historical
entitlementsWhich will be the base for calculating the historical entitlements?
What kind of cross-compliance conditions are envisaged?
Beef Export subsides under
animal health and welfare
standardsDoes this mean that phasing out of export subsidies is not foreseen?
Can you comment on the consistency of this in view of the Doha Ministerial
Declaration?
Beef Intervention price: not
mentionedCan you confirm that no reform is proposed to take place for the 13.089 Mill.
EUR AMS support (G/AG/N/EEC/38)?
Dairy The aim is to allow present
quota arrangements to runout in 2006Is this consistent with the Doha Ministerial Declaration in the sense that
negotiations should be finished in 2005?
Dairy Alternative "3":
Introducing two-tier quotaregimeIf there are doubts about its WTO comp atibility, why does it appear as a
alternative? Would the European Commission envisage nevertheless itsimplementation?
Table (cont'd)WT/TPR/M/102/Add.2
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MTR-CAP Mid Term Review (MTR)
of the Common
Agricultural Policy(CAP)
COM(2002)394Questions for TPRM
Direct payments 20% reduction of all
coupled and decoupled
direct payments at a 3%rateCan you confirm that this will include payments actually notified as "green box"
direct payments?
Are there any direct payments excluded from this reduction?Which is the base period from which the reductions will start (e.g. EUR 28.648
million in Budget 2002)
Does this 20% reduction in 6-7 years represents a "substantial reduction in tradedistortive domestic support" agreed in the Ministerial Declaration of Doha?
Which is the reduction foreseen for other support measures which are not direct
payments (e.g. market price support)?
Direct payments Compulsory modulation of
direct payments for
Member StatesWould this represent additional support from member states?
Are there any estimations of its amount?
Direct payments Integration of all direct
payments a producer
receives from various
schemes into a singlepaymentCould you confirm that for a given product all direct payments stated in the
notifications of the EEC to the Committee on Agriculture as AMS, production
limiting payments and direct payments under Annex II (paras. 5 to 13) of the
Agreement on Agriculture would be integrated into this single payment?Are there any estimations of ht amount of this single payment as a percentage of
the income of framers?
Which sectors will probably be totally included into this new scheme and whichmight not be included?
What does mean that the single payment shall be "neutral"?
Cross compliance "Other" payments are
mentionedWill there be "other" ne w payments different than the "single" decoupled
payment?
Carbon credit Aid of EUR 45/ha. Of
energy crops to producersentering a contract with a
processorCould you inform which are "energy crops"?
Wouldn't this aid establish an incentive for processors for buying domesticproduction?
Rural development New measures primarily to
farmersCould these measures be also dire cted to the processing industry?
Food quality Voluntary aid as a flat rate
per holding for foodquality requirementsCould you inform how would this payment be classified under the Agreement on
Agriculture?
Food quality Promotion activities Could you inform the current budget on promotion activities in third countries?
Standards (animal
welfare, food safety,
environment,
occupationalstandards)Compensatory degressive
payment of EUR 200/haCan you confirm that this payment will classified as non-exempt direct payment?
Would it be available for all producers?
Which is the expected total amount of this measure?
Standards Farm audit support: Flat
rate aidWould this payment be the same for all farmers? If not on which criteria would it
be determined?
Animal welfare Increase of 10 percentage
points of cofinancing ratefor animal welfare
paymentsIs this an additional payment to the compensatory degressive payment of EUR
200/ha?Will these payments be on a headage basis?
Which is the expected total amount of this measure?
Can you confirm that this payment will classified as non-exempt direct payment?
Budget No overshoot of the EUR
40,5 billion per yearDoes this imply that no substantial reduction will take place?
Budget Direct aids Could you inform for the years 2000-2002 the breakdown according to the
classification of domestic support in the Agreement on Agriculture?
What are other measures? (e.g. export subsidies, market price support, equivalent
measure of support)
Table (cont'd)WT/TPR/M/102/Add.2
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MTR-CAP Mid Term Review (MTR)
of the Common
Agricultural Policy(CAP)
COM(2002)394Questions for TPRM
State aid Authorization exemptions Does this mean that member sates will be able to provide national or subnational
support without previous authorization?
If the European commission would be only informed ex-post, how will it preventthat this aid, together with EEC support does respect WTO commitments?
Will this national aid take any form of support or will there be conditions?
How would these conditions be monitored?
Next steps Sectors for scheduled
review in 2003 (olive oil,
sugar, etc.)Could you inform which sectors would be reviewed in 2003?
Taking into account the important support that these two products actually receive
and their importance for developing countries, would this means that the EEC will
make no commitments on these two products (and others) on the date in whichmodalities in the agricultural negotiations will be agreed (31/03/2003)?
External effects WTO negotiations Could you comment why is there no reference to the agreed ongoing negotiations
in agriculture and to the time frames agreed in Doha
Export subsidies Not mentioned Could you confirm that no export subsidies will be applied?
A: The questions above are related to the Mid-term review. We have no response to give on that point
as it is a Commission proposal and not an EC policy.
Question from Korea :
There is a concern that the CAP reform plan propo sed by the Commission, if implemented as it is,
might make the production estimation of individual products more difficult and bring more seriousprice fluctuations.
Please provide any analysis on the impact of the reform proposal on agricultural production.
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Question from Uruguay:
En el párrafo 6 se señala que, "las propuestas hechas por la Comisi6n comprende la reforma del
r6gimen del arroz para integrar este cultivo en el sistema de cultivo de labranza ...: '
Con referencia a este tema, se agradecería si la  UE pudiera brindar mayor informaci6n sobre como
prevé aplicar el nuevo régimen relativo al arroz, en particular en materia de acceso a los mercados y
su posible impacto, dado que Uruguay, siendo el. s6ptimo exportador mundial de arroz, se enfrentacon serias dificultades para acceder a dicho mercado.
A: The Commission proposed recently a rice reform regime included in the MTR. However at this
stage it is only a proposal, consequently it is not appropriate to respond in this context.
Questions from the United States:
In addition to direct payments, does the Common Market Organizations (CMOs) provide other types
of support?
A: Yes. Actually each agricultural sector presents some specificity. For further detail, please refer to
the WTO CoA notification on domestic support (G/AG/N/EEC/38 27/06/02) . In addition, all
information is provided for each OCM on the site of DG AGRICULTURE:
(http://europa.eu.int/scadplus/leg/fr/s04004.htm) .
Does the EU’s July 2002 proposal to the Council fo r a mid-term review of certain regimes anticipate
proposals for other regimes, such as those for fruits and vegetables?WT/TPR/M/102/Add.2
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A: As recently announced by the Commissioner to the European Parliament there will be other OCM
reviews in 2003 eg. Tobacco, Olive oil, wine and possibly Fruit and vegetables.
Is the EU in a position to forecast the im pact of its Mid-Term review proposals on EAGGF
expenditures?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
What kind of constraints, if any, are placed on Member State expenditures on agriculture, particularly
those providing direct income assistance to farmers for specific commodities?
A: As Community agriculture is a common policy (CAP) all expenditure provided by Member States
must be notified to the Commission for prior agreement .
How does the $90.2 billion figure cited in Paragraph 7 for aggregate EU support to producers in
2000 relate to the 40.4 billion Euro figure for CAP expenditures cited in Paragraph 3?
A: The figure of $90.2 billion refers in paragraph 11 (not paragraph 7) is OECD’s PSE estimate,
which equally contains consumer transfers.
Is the EU in a position to estimate what the impa ct of the EU’s mid-term  review proposals would be
on the figures cited in Paragraphs 7 and 8?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
In the mid-term review of its Common Agricult ural Policy, the EU proposes the replacement of
headage payments (for beef production) with singl e income payments per farm based on historical
entitlements. Other than these direct income payments, what other incentives exist to alleviate
intensive production? What will the EU propose once the market situation has become more
balanced?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Under the Mid-term review of the Common Agricultural Policy, the EC lays out four options for the
dairy sector, but does not advocate any major change prior to 2008. Does the EU expect changes in
its dairy policy prior to enlargement?
A: The Commission presents four options without indicative preference and it would have to be
discussed by the Member States in the followin g months. Anticipation of Agenda 2000 dairy sector
reform is not included in these options. Overall, as  Ministers have not adopted MTR proposal, it is not
appropriate to be discussed in this context.
How will the proposed concept of cross-compliance for domestic support affect the treatment of
imports?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.WT/TPR/M/102/Add.2
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The EU has indicated its desire to simplify import protection for rice and cereals through the
establishment of TRQ’s. However, many traders have expressed the sentiment that compliance withthe administration of a TRQ is a rather complicated exercise. Is the EU considering other alternatives
for the simplification of import protection for rice and cereals? If so what are they or if not, why not?
A: The EC intend to unbind its import regime for cereals through the GATT Art XXVIII procedure.
In so doing it is the intention of the EC to replace the current system by a sound, transparent andpredictable import regime based on TRQ. The EC is of the opinion that TRQ can, and indeed should,
be managed in the simplest and most transparent possible ways.
What does the EU perceive to be the biggest obstacle to the elimination of the use of agricultural
export subsidies?
A: Firstly, the EC has substantially reduced the use of export subsidies since 1995. Export subsidies
are becoming less and less significant, falling from 25% of the value of farm exports in 1992 to 5.2%
in 2001. In 2001, export refund expenditure was €2.763 billions. Any policies by third countries,
which have the effect of further depressing world prices will make difficult to move away from theuse of export subsidies. Equally, other forms of s ubsidisation such as the abuse of food aid or export
credit programmes which are trade distorting (for example one WTO Member is the largest provider,
about 95% of the more trade distorting export credits), will also hamper these efforts.
Questions from Brazil:
With the proposals by the European Commission to reform the European Union’s Common
Agricultural Policy, presented early this month, this process seems to have gained new impetus.According to the proposals under discussion, this reform might mean a greater transfer of resources
to rural development. This could mean that the establishment of new standards applied to European
agricultural producers in what refers to traceability, labeling, environmental and animal welfare
standards etc. might also be applied to imports. Could this trend lead to trade restrictions and
technical barriers? Could the EU provide any guidance on the proposals being considered?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Will there be any increase in agricultural subsidies after the CAP is reformed and after the EU’s
enlargement is carried through? If so, for which sectors?
A: The EC will respect all its commitments, before and after accession of new Member States.Are the agricultural subsidies granted by each Member State individually, outside of the EU budget,
equally notified to the WTO? Could the EU prov ide information on the amount of subsidies granted
by each member state for each sector?
A: Member States do not allocate export subsidies.
The European Commission has proposed, through Regulation 223/2002, of July 9th 2002, to change
the rules that apply to the imports of salted chi cken meat. According to the measure, the product will
be classified in a new tariff heading (02071410), to which higher import duties apply. This change
seems objectionable, and one might wonder whether this has been done in order to protect European
producers, thus impairing other countries’ rights. How is this measure compatible with the
obligations incurred by the EU  in the GATT/WTO agreements?WT/TPR/M/102/Add.2
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A: The objective of the regulation 223/2002 of 9 July is to ensure an uniform application of the
Combined Nomenclature. The product in question is not salted chicken meat but chicken meat frozenfor long term conservation. The method of conservation of the product is freezing and not salting. The
percentage of salt is to low to ensure the conservation. The addition of salt does not alter the character
of the product as frozen meat of heading 0207. Consequently, the above measure is WTO compatible.
Besides stricter sanitary rules, the reform of the CAP is expected to prioritize the adoption of stricter
legislation on environmental and animal protection at the expense of focusing, as it does now, on the
production of surplus agricultural commodities. How would that change influence the concession of
subsidies to third countries regarding production to be exported to the EU, as is the case with sugar
in ACP countries and India?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
According to the report by the Secretariat (paragraph 25), the EU has reduced the value and volume
of subsidized exports. Could the EU quantify this reduction in value and volume, with respect toindustrial products and services?
A: The respective paragraph cited by Brazil only relates to agricultural products. The EU does not
grant any export subsidies to industrial products and services
Question from India:
In Para 38 of the Summary Observations, the Secretariat notes that the funding for CAP continues to
represent the single largest expenditure; 44% of the total budget of 93 billion Euro. Keeping in view
the ongoing efforts for the enlargement of EU, a dditional burden on the EU agricultural subsidy bill
is expected. Moreover, as noted by the Secretariat in Para 46 of the Summary Observations, the
decline in the support to agricultural producers is basically attributable to world market price and
currency fluctuations rather than ‘any significant policy change’. In the light of Doha Mandate whichenvisages ‘reduction of with a view to phasing out’ all trade distorting agricultural subsidies, will EU
explain its plan to dismantle the agricultural subsidy regime?
A: Firstly, the EC has substantially reduced the use of export subsidies since 1995. Export subsidies
are becoming less and less significant, falling from 25% of the value of farm exports in 1992 to 5.2%in 2001. In 2001, export refund expenditure was €2.763 billions. The EU is ready to negotiate further
reductions on the condition that all forms of export subsidisation (export credits, abuse of food aid,
unfair practices of state trading enterprises) will be disciplined. At this stage, we cannot be more
specific on either the subsidy reduction percentage or the implementation period. This will depend on
the WTO negotiations.
(iii) CAP and Enlargement
 Question from Canada:
Paragraph 100 of the government report indicates that the next big step ahead for the EU is tosuccessfully manage a smooth enlargement process, which will, no doubt, have its impacts at a global
level. Since most of the applicant countries have a large agriculture sector, please share how the
Commission proposes to extend the CAP and its ex tensive support mechanisms to these countries
while respecting budgetary constraints. Please indicate  if further CAP reform will be necessary in the
sectors not covered by the mid-term review. Please outline some of the anticipated trade impacts of
enlargement and particularly explain  how the EU proposes to compen sate for the loss of existingWT/TPR/M/102/Add.2
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rights of market access due to enlargement. Also, please share your view on the status of existing
Bilateral Investment Treaties with Central and Eastern European members following EUmembership.
A: The Commission's thinking on this issue is basically laid down in its issues paper "Enlargement
and Agriculture: Successfully integrating the new Member States into the CAP" of 30.1.2002. This
document as well as the relevant press release is available on the AGRI web-site under enlargement.
 As regards the economic impact of enlargement there are two studies, also available on the web-site.
The most recent one of March 2002 analyses the impact of various enlargement scenarios on the
candidate countries agri sectors.
 
 Question from Uruguay:
En el Párrafo 7 del Capt IV se señala que, "la suma gastada en la PAC fue de 40.400 millones de
euros en 2000, lo que representa alrededor de un 43,9 % de los gastos de la comunidad" y en el
Párrafo 11 se indica que "en t6rminos absolutos, la UE proporciono mss apoyo a los productores en
2000 que cualquiera de los otros miembros de la OCDE".
Por su parte, en el párrafo 14 se cita que, en el marco de la adhesión de los nuevos Estadosmiembros y su participación en la PAC, "la Comisión prevé nuevos gastos por valor de 5.600
millones de euros en 2004 en el marco de una propuesta formulada el 30.01.2002 principalmente
como consecuencia de las subvenciones agrícolas"
Podría comentar la UE, como va a conciliar lo s subsidios antes referidos con el mandato aprobado
por los Ministros en Doha para lograr reducciones de todas las formas de subvenciones a la
exportación con miras a su remoci6n progresiva y reducciones sustanciales de la ayuda interna
causante de distorsión del comercio.
A: Concerning the amount of aid, it is misleading  to speak of 44 % of the budget. The EU budget was
a small part of the national budgets of the Member States. Agricultural expenditure represented just
0.5% of EU GDP or less then 3% of total public expenditure of the EU and its Member States. The
EC will respect all its WTO commitments, before and after accession of new Member States.
 
Question from Brazil:
According to the Commission, what would be the im pact of the accession to the EU of new members
from Eastern Europe on the Common Agricultural Poli cy? What are the steps envisaged for their full
integration to the CAP?
A: The Commission's thinking on this issue is basically laid down in its issues paper "Enlargement
and Agriculture: Successfully integrating the new Member States into the CAP" of 30.1.2002. This
document as well as the relevant press release is available on the AGRI web-site under enlargement.
As regards the economic impact of enlargement there are two studies, also available on the web-site.The most recent one of March 2002 analyses the impact of various enlargement scenarios on the
candidate countries agri sectors.
Does the EU envisage any increase in agricultur al import quotas after the EU enlargement? For what
products? Which criteria should apply?
A: The EC will respect all its commitments, before and after accession of new Member States.WT/TPR/M/102/Add.2
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(iv) Developments in selected subsectors
Arable crops
Questions from the United States:
Can the EU provide figures on area for cereals and oilseeds since the time that the CAP Agenda 2000
reforms were implemented?
A: Please consult two tables in annex for marketing year 2001/02. For other years, consult the serveur
EUROSTAT NEW CRONOS.
How does the EU anticipate that its Mid-Term re view proposals would impact cereals and oilseeds
areas?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
How does the EU anticipate that the Mid-Term re view proposals would affect market access for
grains and rice?
A: As those are proposals from Commission and not EC measures, it is not appropriate to respond in
this context.
Can the EU provide figures on area for cereals and oilseeds since the time that the CAP Agenda 2000
reforms were implemented?
A: See Annex A
Question from India:
In accordance with the UR negotiations the import of rice into EU is subject to a margin of
preference scheme under Head Note VII. We will like to know from EU whether they have any plan tomodify the present arrangement for the rice import from India?
A: A proposal to modify the EC import regime fo r rice through GATT Article XXVIII procedure, is
presently under examination. The intention of the EC is to replace the current system by a sound,
transparent and predictable import regime based on TRQs. The EC is of the opinion that TRQs can,and indeed should, be managed in the simplest and most transparent way possible.
BeefQuestions from Canada:
Paragraph 24 states that a ban on mammalian MBM in all animal feed was put into place as of 1
January 2001, and has been extended without deadline, pending a new policy on animal by-products.
Since this ban goes beyond the recommended international animal health standards which is a
ruminant-to-ruminant feed ban, please indicate the EU’s scientific rationale for the mammalian ban.
A: The current prohibitions on the feeding of animal proteins to farmed animals (the extended feed
ban) are transitional measures, remaining in force until 30 June 2003, at the latest. By that time, the
feed ban should be reconsidered taking into account , among others, the provisions in the Animal By-
Products Regulation which is expected to be adopted in September 2002.
The rationale for the extended feed ban are not indications or scientific evidence that animal proteins
from non-ruminants may transmit TSE, but concerns control and implementation aspects. Firstly, it isWT/TPR/M/102/Add.2
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very difficult to exclude the presence of ruminant proteins in ruminant feed if other animal proteins
are allowed. Secondly, cross-contamination between ruminant feed and non-ruminant feed containingruminant proteins was frequently observed before the implementation of the extended feed ban.
Many of the provisions of the animal-by-products also go beyond international standards. Where is
the EU’s scientific rationale behind this proposal?
A: The EU considers the proposed Regulation on animal by-products to be fundamental to the EU
strategy of food and feed safety. The experiences of a range of food safety crises such as BSE, foot-
and-mouth disease and dioxin point to inadequate collection, treatment and disposal of animal by-
products as a key area of vulnerability in our present food safety framework. The proposed Regulation
is in line with the opinions of the EU Scientific Steering Committee (SSC), which recommend thatmaterials derived from animals declared unfit fo r human consumption following health inspection
should not be used in feed. In particular, the following scientific opinions are relevant:
• Opinion on the safety of meat-and-bone meal from mammalian animals, naturally or
experimentally susceptible to TSEs (adopted on 26-27 March 1998 and updated on 24-25September 1998)
• Opinion on the safety of tallow derived from ruminant tissues (adopted on 26-27 March 1998
and revised on 28-29 June 2001)
• Report and opinion on the safety of gelatine (adopted on 26-27 March 1998 and updated on
20-21 January 2000 and on 28-29 June 2001)
• Report and opinion on the safety of dicalcium phosphate precipitated from ruminant bones
and used as an animal feed additive (adopted on 25-26 June 1998)
• Opinion on mammalian derived meat-and-bone meal forming a cross-contaminant of animal
feedstuffs (adopted on 24-25 September 1998)
• Report and opinion on the safety of hydrolysed  proteins produced from bovine hides (adopted
on 22-23 October 1998)
• Opinion on the risks of non conventional transmissible agents, conventional infectious agents
or other hazards such as toxic substances entering the human food or animal feed chain via raw
material from fallen stock and dead animals (including also: ruminants, pigs, poultry, fish,
wild/exotic/zoo animals, fur animals, cats and laboratory animals) or via condemned material
(Fallen stock opinion) (adopted on 24-25 June 1999 and re-edited on 22-23 July 1999)
• Opinion on the risk born by recycling animal by-products as feed with regard to propagating
TSE in non-ruminant farmed animals (Intra-species recycling opinion)(adopted on 17 September
1999)
• Opinion on the safety of ruminant blood with respect to TSE risks (adopted on 13-14 April
2000)
Paragraph 25 states that other measures taken include the removal of specified high-risk materials
(SRM) as of 1 October 2000, applied equally in the EU and to imported products, except from
countries classified in category 1 of "Geographical BSE Risk (GBR)", which is the highest riskcategory. GBR assessment, category 1 to 5, is conducted by the Scientific Steering Committee of the
EU according to established methods last revised in January 2002. These methods include an
assessment of the exposure of the country to BSE as  a result of imports of live animals from the EU
and responses by the country to a questionnaire. According to the Commission, the categories of
countries and the measures to be applied are in line with the international standards of the Office
International des Epizooties (OIE).”
The EU measures related to BSE and TSE have prohibited Canadian exports of gelatine, beef casings,bone-in-beef, bovine animals, embryos and the propos ed animal by-products legislation will further
eliminate our tallow exports. Canada disputes the BSE geographic risk rating the EU has assigned asWT/TPR/M/102/Add.2
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it has never had a native case of BSE and is BSE-free under International Organization for Epizootics
(OIE) criteria. When will the EU bring its categoriza tions and risk-measurement in line with the OIE?
The statement "Geographical BSE Risk (GBR) assessment, category 1 to 5, is conducted by
the Scientific Steering Committee of the EU accord ing to established methods last revised in January
2002", may need some clarification in order that countries understand the relationship between the
EC's GBR classification exercise and the final assignm ent of the BSE status to a country. Canada's
understanding is that the GBR classification exercise (described in the January 2002 methodologyand determined by the SSC) is still FOUR categories (I-IV) and not 5, as implied above.
Please clarify the relationship between the GBR rating of I to IV determined by the Scientific
Steering Committee and the BSE Status Categorisation of 1 to 5 to be determined by risk managers
according to 999/2001/EC. Please indicate how  one numeric rating will affect the other.
A: The BSE categorisation in Regulation 999/2001 is in line with the OIE standard. However the OIE
has not yet categorised countries, and it is not possible to predict in which category the OIE will place
Canada. The actual categorisation will have to be made by the EU, taking into account the advice
from the SSC.
The determination of the BSE status comprises tw o steps: a risk assessment and the evaluation of
additional criteria as defined in Regulation 999/2001 and the OIE Code. The applying countries have
been asked to specify whether the GBR can be used as the initial risk assessment in the framework of
the determination of the status, or whether they want to submit their own risk assessment. Canada has
submitted its own risk assessment. This risk assessment has been submitted to the SSC for an opinion.
Canada will have the opportunity to comment before the final opinion will be adopted.
The GBR gives a rating between I and IV (four catego ries). The final BSE status will be established
based on the outcome of the risk assessment and the evaluation of the other criteria. The final BSEstatus classifies countries into five categories, i. e. category 1 (BSE free) –category 5 (high BSE risk).
At this stage it is too early to give exact numerical predictions how countries will be classified in
relation to their GBR rating.
While Canada agrees that the EC criteria, as described in 999/2001/EC (which is not yet being
applied), for classifying a country's BSE status does closely mimic OIE standards, we do not agree
that all measures applied are in line with international standards. The OIE recommends a ruminant-
to-ruminant feed ban. In the EC's criteria for a BSE Status Category 1, it is stated that no meat and
bone meal or greaves derived from ruminants OR  MAMMALS has been fed to ruminants. We also
note that when 999/2001/EC comes into effect, countr ies with a BSE status rating of 2, 3, 4 or 5 will
be required to certify that a full mammalian-to-ruminant feed ban in place. This feed ban requirement
also extends beyond OIE requirements. In addition, as of July 2002, the EC also has restrictions in
place with respect to imports of cattle embryos wh ich are not consistent with OIE standards. It is our
understanding that this measure will be modified. Please indicate when it will be amended
A: The measures referred to are fully in line with the OIE recommendations, except that where the
OIE recommends a ruminant to ruminant feed ban, the EU has required a mammalian to ruminant
feed ban. This difference was motivated by reasons of control, as no country so far has been able to
demonstrate that a ruminant to ruminant feed ban can be implemented effectively. In meetings on the
technical level between the Commission services and representatives of the Canadian authorities todiscuss this problem, Canada has been invited to demonstrate that it has an effective ruminant to
ruminant feed ban but has declined to do so.
In the OIE General Session this year, some of  these OIE recommendations were amended. These
amendments will be reflected in the EU legislation, and a proposal to delete the conditions for
embryos has already received a favourable opinion of the Standing Committee of the Food Chain and
Animal Health. It is expected that the proposal will be formally adopted shortly.WT/TPR/M/102/Add.2
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Paragraph 26 states that although not directly related to BSE, the legislation banning hormones as
growth promoters was revised as of 1 July 2001 on the basis of scientific evidence collected by theCommission. The original legislation was the subjec t of a WTO dispute settlement proceeding in the
context of which certain, mainly agricultural, EU exports have undergone sanctions in Canada and
the United States. Modifications of the Directive to bring EU legislation into compliance with the
WTO ruling are currently under discussion in the Council and the European Parliament.
The EU ban on growth-promoting hormones is not scientifically justified. In 1997, a WTO panel ruledthat the ban is inconsistent with the EU’s WTO obligations. The finding was confirmed by the WTO
Appellate Body in 1998. A WTO arbitrator gave the EU until May 1999 to comply with the WTO
rulings. Given the EU’s failure to comply with the WTO rulings, or provide adequate compensation,
Canada imposed retaliatory tariffs in July 1999. The EU has still not implem ented the WTO rulings.
Please explain how modification of the Directive will bring EU legislation into compliance with theWTO rulings. Please indicate if this modification will allow for export of Canadian beef to the EU.
A: At the end of the World Trade Organisation (WTO) Dispute Settlement, the WTO Appellate Body
concluded that the prohibition of imports of m eat from hormone-treated animals to the EU did not
comply with the requirement that such a measure should be based on a relevant assessment of therisks to human health. As a consequence the European Commission immediately initiated a
complementary risk assessment which was mandated to the Scientific Committee on Veterinary
measures relating to Public Health (SCVPH). The committee was asked to evaluate the risks to human
health from hormone residues in bovine meat and meat products treated with six hormones (oestradiol
17ß, testosterone, progesterone, trenbolone acetate, zeranol and melengestrol acetate) for growth
promotion. The SCVPH concluded in 1999 that no acceptable daily intake (ADI) could be established
for any of the six hormones evaluated. For oestradiol 17ß it concluded that there is a substantial bodyof evidence suggesting that oestradiol 17ß has to be considered as a complete carcinogen (exerts both
tumour initiating and tumour promoting effects) and that the data available would not allow a
quantitative estimate of the risk. Since then the SCVPH has continued to take into account any new
emerging scientific data from any source, including the considerations of the United Kingdom's
Veterinary Products Committee (1999), the Committee on Veterinary Medicinal Products of the EC(1999), the Joint FAO/WHO Expert Committee on Food Additives (JECFA).
In order to consider in particular data from third countries, an open call was published in 1999
requesting documentation from any interested party,  including the industry, to provide any relevant
and recent scientific data and information in their possession to be taken into account in the
complementary risk assessment. To close some of the evident knowledge gaps the EuropeanCommission has moreover commissioned 17 studies.
The EU proceeded as described to be sure that it s decisions would always take account of scientific
developments. An effort has been made to ensure that all scientific evidence considered has been peer
reviewed. However so far, none of the scientific information made available could convince scientists
to reverse their evaluation of the six hormones in question, so that they had to re-affirm their advice inreviews. The last review was concluded as recent as April 2002.
The new legislative proposals of the EU have thus been based on the newest available scientific
opinions. Thus the measure is based on a scientific justification as requested in Article 3.3 of the SPS
agreement.
Canadian beef may be imported into the EU if the Canadian government can give sufficient guarantees
that it has not been treated with hormones for gr owth promotion and thus complies with the level of
protection chosen by the EU.
In April 2002, the EU Scientific Committee on Veterinary Measures relating to Public Health
(SCVPH) re-affirmed, but only on the basis of partia l, inconclusive results from the 17 studies and
other recent scientific data, that the use of hormone s as growth promoters for cattle poses a potentialWT/TPR/M/102/Add.2
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health risk to consumers. Please indicate when conclusive scientific evidence that justifies the EU ban
will be available.
A: The first scientific opinion of the Commission's independent advisory committee was adopted in
1999. It was transmitted to the Canadian authorities by the services of the European Commission.
Moreover it was made available for everybody on the European Commission homepage at :
http://europa.eu.int/comm/food/fs/him/him_index_en.htmlThe opinion was reviewed in May 2000 when new information became available and confirmed the
earlier opinion.
The 17 studies mentioned by the Canadians, were launched in early 1998, prior to the initial scientific
opinion of April 1999, in order to address certain gaps identified by the Commission following the
ruling of the WTO Appellate Body concerning the scientific basis for the EC import ban. Theyprovided additional information but did not address the specific gaps identified in the first scientific
opinion.
In accordance with the Commission's willingness to continue to take into account new scientific data,
as soon as the results of the 17 studies became available, they where passed to the Scientific
Committee together with other recent scientific data.In their latest opinion, the Committee confirmed the validity of the first opinion and stated that no
amendments were justified.
The Commission will keep the situation under review.
Question from Australia :
Hormonal growth promotants
In relation to the use of hormones as growth prom otants in cattle, when does the EU expect to modify
the relevant Directive to bring EU legislation into compliance with the WTO DSB ruling?
A: A proposal to modify the relevant directive has been introduced in the decision making process of
the European Community. It is expected that it will be adopted before the end of 2002.
Question from Argentina :
En el párrafo 26 de la página 94 del Informe de la Secretaría se indica que la Unión Europea se
encuentra considerando la modificación de la actual legislación relacionada con la carne con
hormonas que fuera cuestionada en la OMC. ¿Podría la Unión Europea informar si ese proceso se
ha iniciado y si existe algún proyecto en tal sentido? ¿En caso afirmativo, es posible consultar talproyecto?
A: The EC is in the process of amending the relevant Council Directive. The EC will fully inform
Members at an appropriate stage.
Questions from the United States:
When will the EU complete its current review of the classification of countries for BSE risk?
A: According to Regulation 999/2001 the BSE status of a country shall be determined within 6
months of the receipt of a complete dossier. The US application, with particular reference to their riskassessment, is currently being examined. During th at process the need for further information may be
identified. In that case, the US authorities will be contacted. When draft conclusions on the risk
assessment become available, they will be sent to the US authorities for comments. Based on the final
conclusions on the risk assessment and the result of the evaluation of specific additional criteria, the
final BSE status of the country will be established.WT/TPR/M/102/Add.2
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Under the EU’s TSE regulation 999/2001, Article 5.2, subparagraph 1, of the regulation states that a
decision on determination of BSE Status shall be taken within six months of the submission of the
application. The United States submitted its application to the EU on December 28, 2001. Please
explain when the United States can expect a determination of BSE status.
A: Regulation (EC) No 999/2001 stipulates that if  further information is needed, the final decision
shall be taken within six months of the submission of all information. Since the experts are stillexamining the US application, additional information may be needed. Therefore, it is at this moment
difficult to predict when the final determination of BSE status can be expected.
Can the EU present new, peer-reviewed scientific evidence to support its current ban on imports of
U.S. beef from cattle which have been tr eated with approved growth promotants?
A: The newest peer reviewed scientific advice (with references) is available for everybody on the
European Commission homepage at :
http://europa.eu.int/comm/food/fs/him/him_index_en.html
Paragraph 11 says that the discussion is underway to bring EU legislation banning the productionand imports of beef produced with growth horm ones into compliance with the WTO ruling on the
matter. Please explain what is being considered to bring EU legislation into compliance.
A: At the end of the World Trade Organisation (WTO) Dispute Settlement, the WTO Appellate Body
concluded that the prohibition of imports of m eat from hormone-treated animals to the EU did not
comply with the requirement that such a measure s hould be based on a relevant assessment of the risks
to human health. As a consequence the European  Commission immediately initiated a complementary
risk assessment which was mandated to the Scientific Committee on Veterinary measures relating to
Public Health (SCVPH). The committee was asked to  evaluate the risks to human health from hormone
residues in bovine meat and meat products treated with six hormones (oestradiol 17 β, testosterone,
progesterone, trenbolone acetate, zeranol and mele ngestrol acetate) for growth promotion. The SCVPH
concluded in 1999 that no acceptable daily intake (ADI) could be established for any of the six
hormones evaluated. For oestradiol 17 β it concluded that there is a substantial body of evidence
suggesting that oestradiol 17 β has to be considered as a complete carcinogen (exerts both tumour
initiating and tumour promoting effects) and that  the data available would not allow a quantitative
estimate of the risk. Since then the SCVPH has continued to take into account any new emerging
scientific data from any source, including the c onsiderations of the United Kingdom's Veterinary
Products Committee (1999), the Committee on Veterina ry Medicinal Products of the EC (1999), the
Joint FAO/WHO Expert Committee on Food Additives (JECFA).
In order to consider in particular data from third countries, an open call was published in 1999
requesting documentation from any interested party, in cluding the industry, to provide any relevant and
recent scientific data and information in their possess ion to be taken into account in the complementary
risk assessment. To close some of the evident knowledge gaps the European Commission has moreover
commissioned 17 studies.
The EU proceeded as described to be sure that it s decisions would always take account of scientific
developments. An effort has been made to ensure that all scientific evidence considered has been peerreviewed. However so far, none of the scientific information made available could convince scientists
to reverse their evaluation of the six hormones in question, so that they had to re-affirm their advice in
reviews. The last review was concluded as recent as April 2002.
The new legislative proposals of the EU have thus been based on the newest available scientific
opinions. Thus the measure is based on a scientific justification as requested in Article 3.3 of the SPS
agreement.WT/TPR/M/102/Add.2
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What measures does the EU intend to implement in  order to encourage production of organic beef?
A: There are no specific measures for organic beef, there is only general support under the rural
development agri-environment schemes for conversion to organic production .
Question from Brazil:
The European Commission has recently approved Regulations 1149 and 1150/2002, which increased
the quotas for imports of high quality bovine meat (“quota Hilton”) from Paraguay (1,000 ton) and
Argentina (10,000 ton more, per one year). Which were the criteria for defining such tariff quotas?
A: The two above mentioned tariff quotas have been introduced taking into account the situation in
the market and the demand of consumers in the Community.
DiaryQuestion from Australia:
The Secretariat report (page 76, paragraph 28) notes that the Court of Auditors found that the EU’s
milk quota system sets the quota level too high in relation to demand, leading to structural surpluses
which are then sold on world markets through utilisation of export subsidies. As Agenda 2000 already
provides for an increase in dairy quotas from 2005 and milk surpluses are expected to rise further
following EU enlargement, what steps does the EU  plan to take to address this distortion to world
trade?
A: The Commission presents four options without indicative preference and it would have to be
discussed by the Member States in the followin g months. Anticipation of Agenda 2000 dairy sector
reform is not included in these options. Overall, as  Ministers have not adopted MTR proposal, it is not
appropriate to be discussed in this context.
Question from Argentina :
En el párrafo 28 de la página 95 del Informe de la Secretaría se indica que luego de accesión de
nuevos miembros a la Unión Europea el problema de la superproducción de leche se empeorará.
¿Teniendo en cuenta los compromisos de Doha, como se resolverá este problema sin recurrir al
aumento de subsidios a la exportación?
A: As regards the determination of the reference quantity for milk with regard to WTO constraints,
this aspect is covered by basing the quota on a recent reference period and not on one which predates
the introduction of WTO constraints. Thus, the WTO commitments and their effective
implementation are sufficiently reflected as well as the market balance reached at the end of theUruguay round. WTO constraints also bear only indirectly upon the level of milk production because
they apply separately to butter, skimmed milk powder, cheese and a miscellany of other milk
products.
Questions from the United States:
When does the EU plan to propose reforms to the dairy sector. Is the EU in a position to describe in a
general way what the nature of future dairy reforms will be?
A: The Commission presents four options without indicative preference and it would have to be
discussed by the Member States in the followin g months. Anticipation of Agenda 2000 dairy sector
reform is not included in these options. Overall, as  Ministers have not adopted MTR proposal, it is not
appropriate to be discussed in this context.WT/TPR/M/102/Add.2
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Why does the EU not feel that "liberalization of the milk market on the same basis as for cereals
would, generally speaking, mean lower costs to consumers?"
A: As said above, four different options will be submitted to the Council. Ministers would discuss
about all of these approaches. Consequently, it is premature to be more precise at this stage.
Dairy producers in certain EU member states consistently exceed their production quotas every year.
While a levy is charged to the member states involved, these member states are not known to recoup
the payments from producers. Does the EU include this member state subsidy to producers in its
notification? How does this additional subsidy affect the EU's compliance with production-limiting
criteria for blue-box support?
A: In accordance with EC Regulation 1256/99, the milk levy is paid by producers to the competent
member state authorities and transferred to th e EU budget. EU clearance of account procedures
foresee that any shortfalls in transfers from member states, including in respect of milk levies, need to
be recovered from the member state in question. There is therefore no addional "national" support and
consequently no effect on EU compliance with "blue box" criteria.
SugarQuestion from Guatemala :
Párrafo 32: “ En un informe especial publicado por el Tribunal de Cuentas en 200 relativo a la
gestión de la organización común de mercados del azúcar se señaló que ésta no había sufrido
cambios a raíz de las propuestas de reforma de la PAC en 1992 ni en relación con la Agenda 2000”...“El tribunal concluye que “pese a la situación de exceso de producción estructural, la Comisión se
ha limitado repetidamente a proponer la continuación del régimen del azúcar y a mantener
inalterables los niveles de las cuotas y los precios”.”
¿Podría la Unión Europea, indicarnos cómo tiene pensado enfrentar esta situación y si piensa
reformar el sector azucarero en un momento cercano?
A: The EC extended its current regime until 30 June 2006. However, the Commission will present a
report to the Council in 2003.
Questions from Australia :
The EU Court of Auditors’ report noted the high ra tes of return to sugar beet farmers compared to
other crops. The Commission’s Consumer Committee has also expressed concern that sugar prices
are “increasingly out of line with other arable crops” and that “an effort should be made to reduce
the very high consumer burden and trade distortion effects of the sector”. What has been done to
remedy this situation?
A: Beet prices are more or less unchanged sinc e 1982/83. They are “out of line" with other arable
crops because the regimes and the prices for these arable crops have changed. The final consumer is
hardly affected by the sugar prices as over 70 % is consumed in processed good where the sugar
represents only 5 to 10 % of the consumer price. Consumer prices are therefore not the main drivingfactor for a reform of the sugar market organisation.
Sugar was not included in either the 1992 or the Agenda 2000 reforms. The Court of Auditors report
recommended that “alternative support measures should be considered for reforming the CMO to
meet the aims of the 1992 and Agenda 2000 reforms”. The roll-over of the sugar scheme in 2001
clearly did not meet this requirement, why not and what is being done to address this?WT/TPR/M/102/Add.2
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A: The report quoted was published in the Official  Journal together with the reply of the Commission.
From this it becomes clear that a radical reform of the sugar regime would have consequences thatmust be further analysed. Some studies appeared to be still needed before deciding an option for a
reform. Consequently, the decision by the Coun cil (Regulation (CE) no. 1260/2001) on the Common
organisation of the markets in the sugar sector mandates the Commission to submit at the beginning
of 2003 a report on the functioning of the common market organisation for sugar together with
appropriate proposals with a view for a possible reform.
What studies are being undertaken to consider options for the 2003 mid-term review of sugar? Will
there be any opportunity for other countries to have an input?
A: Three studies are being undertaken. The first one has to assess the impact of options for the future
reform of the sugar common market organisation. Two other studies cover the structure of
competition and the degree of concentration as well as price transmission in four Agro-food Sectors
(sugar, dairy, cereals and meat).
The studies are carried out by independent consultants in conformity with the terms of reference
agreed. The question of an input from the other countries lies with them.
What is the EU estimate of the proportion of sugar imported from ACP countries that is subsequently
re-exported using export subsidies (whether “self-financed” or not)?
A: As the EU is a surplus producer (quota sugar production exceeds internal consumption) an
equivalent amount of any preferential and other imports has to be re-exported. However a very large
part of these imports is physically consumed in the countries where these imports take place mainly inthe form of raw sugar for refining.
Out-of-quota or C-SugarWe note that the Court of Auditors said that “ ‘C’ sugar (production in excess of quota), which
receives no export refunds, can only be sold profitably at world market prices because the prices
obtained for sales of quota sugar are sufficient to cover all the fixed costs of the processing
company”. Can the EU explain/justify the statem ent (in paragraph 33, page 77 of the Secretariat
report) that out-of-quota or ‘C’ sugar is exported without subsidies? How many enterprises produce
‘C’ sugar? In what Member States is ‘C’ sugar produced? Is any ‘C’ sugar produced separately from
‘A’ and ‘B’ sugar?
A: As explained earlier, only EU quota sugar (and AC P/India sugar) is eligible to export refunds. EU
sugar produced outside the quotas may not be marketed on the EC market and must be exported
before 1 January following the end of the marketing year, except the sugar is carry forward to the nextmarketing year. In the latter case, this sugar becomes part of the new year’s quota production. Table 2
provides details of C sugar production and carry over in the different Member States for the
1999/2000 marketing year.
EU Sugar ProductionWhat are the average costs of production for sugar, Member State by Member State?A: The Commission has no figures on average costs for sugar production in the different Member
States. Such costs vary from factory to factor y and from producer to producer and are highly
confidential and not communicated to the Commission.WT/TPR/M/102/Add.2
Page 188
What are the components in establishing the le vel of export refund on ‘A’ and ‘B’ quota sugar and in
incorporated products?
A: There are no differences in the level of export refunds for A or B quota sugar. A difference lies in
the level of the production levies charged for A and B quota sugar to cover the exporting costs. The
elements for establishing the export refund are the difference between the EU intervention price +
fobbing costs and the world market price as quoted on the London Future Market. Sugar incorporatedin processed goods gets the same - but slightly reduced - refund derived from the refund for sugar
exported in the natural state fixed by a weekly tender.
What is the overall outlay on export refunds, including ‘A’ and ‘B’ sugar ACP/India equivalent and
on incorporated products? Is there a breakdown for each category?
A: The overall outlay on export refunds for the 2001 EU Budget for sugar was 1.008 million Euros
and for processed goods 180 million Euros. There is no breakdown made for A and B quota nor for
preferential ACP sugar.
What is the amount of the production levy collected from Member States, in total and at Member State
level?
A: The total amount of sugar levies was 720 million in the 2001 Budget.In regard to incorporated products, what is the product coverage and the breakdown in export
refunds by sector?
A: The list of processed products which may benefit of sugar export refunds are given in Annex V of
Regulation (EC) No. 1260/2001 (OJ No. L 178 of 30.6.2002) and in the Annexes of Regulation (EC)
No. 1500/2000 (OJ No. L 177 of 15.7.2000).
In the EU schedule of export subsidy commitments, what products are counted against: (a) the
commitment on sugar; and (b) the co mmitment on incorporated products?
A: The commitments referred to in the EU sche dule under "Sugar" (1.273,5 Mio. t EU sugar + 1,6
Mio. t ACP/Indian sugar) concern only exports of sugar in "natural state" and certain other sugar
products (syrups, candy products, etc.). The commitments referred to under "Incorporated products"
(415,0 Mio. Euro) cover all agricultural raw materials (sugar, dairy products, cereals, eggs) which can
be used for processing purposes in accordance with the relevant EU regulations.
Questions from Brazil:
In May 1999, after political agreement was reached within the Berlin European Council, the
Agricultural Council adopted specific regulations se tting out the reform of the CAP. However, sugar
was not included in the reform. When, in the last  Trade Policy Review of the European Union, Brazil
asked about the prospects of sugar being included in the reform, the EU answered that it was
“actively considering the issue”. Is there any possibility that this might take place in the near future?
A: According to the mandate given in 2001 by the Council in the context of the extension of the EU
sugar regime until the 2005/2006 marketing year, the Commission will submit, at the beginning of
2003, a report on the functioning of the common market organisation for sugar together with
appropriate proposals with a view for a possible reform.WT/TPR/M/102/Add.2
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What are the average costs of production for sugar by member State? Although sugar is responsible
for a mere 2.5% of the EU’s agricultural pro duction, it absorbs approximately 4.5% of the CAP
funds. What is the reason of that disproportion?
A: The Commission has no figures on average costs for sugar production in the different Member
States. Such costs vary from factory to factor y and from producer to producer and are highly
confidential and not communicated to the Co mmission. As regards the CAP funds, in 2001 the
expenditures spend for the sugar sector represented 3,7 % of the total expenditure for Agriculture and
Rural Development. On the other side, export refunds for exporting Community sugar are fully
refinanced by the production levy paid by the beet and sugar producers, except sugar imported under
preferential conditions and  re-exported with export refunds.
As regards the "disproportion" between production value and the CAP funds, the Commission cannotsee a valid reason to draw conclusions in comparing the value of the sugar production with the CAP
expenditures for that product. Nevertheless, it is worth mentioning that the expenditures contain the
refunds paid for preferential sugar re-exports which represent nearly 60 % of the total EU sugar
exports.
In the EC schedule of export subsidy commitments, which products are counted against (a) the
commitment on sugar and (b) the commi tment on incorporated products?
A: The commitments referred to in the EU schedu le under "Sugar" (1.273,5 Mio t EU sugar + 1,6 Mio
t ACP/Indian sugar) concern only exports of sugar in "natural state" and certain other sugar products
(syrups, candy products etc.). The commitments referred to under "Incorporated products" (415,0 Mio
Euro) cover all agricultural raw materials (sugar, dairy products, cereals, eggs) which can be used for
processing purposes in accordance with the relevant EU regulations.
Could the EU provide some clarification on the sugar import regime as to the amount and value of
the imports, particularly on those imports co ming from countries that have preferential trade
agreements with the EU? What are the criteria for establishing the prices of those imports, which areconsiderably higher than those practiced in the world market?
A: For imports under non-preferential conditions a "bound" tariff rate and, in applying the special safe
guard clause, an additional import duty are applicable in accordance with the provisions of the WTO
Agreement on Agriculture. They are no quantitative import restrictions.As regards the preferential imports (duty free or reduced duty rate):
1. EU/ACP Sugar Protocol of 1975 and the EU/India Agreement of 1975:
The EU commits to import annually 1.304.700 t of white or raw sugar from the following
ACP countries and India within the limits of agreed quantities (see Table 1).
The prices to be paid are negotiated annually  between the EU and the ACP countries. In the
past the prices paid for bulk raw cane sugar have always been equivalent to the EU intervention price
for raw sugar (in 2001/2002: 52,37 Euro/100 kg; insurance and freight costs to European ports
included).WT/TPR/M/102/Add.2
Page 190
Table 1:
Preferential sugar of the EU/ACP Sugar Protocol of 1975 and the EU/India Agreement of 1975
CountryAgreed quantities
in 2001/2002
(tonnes in White Sugar Equivalent)
Barbados 50.312,40
Belize 40.348,80
Congo 10.186,10
Fiji 165.348,30
Guyana 159.410,10
Ivory Coast 10.186,10
Jamaica 118.696,00
Madagascar 10.760,00
Malawi 20.824,40
Mauritius 491.030,50
St Kitts 15.590,90
Swaziland 117.844,50
Tanzania 10.186,10
Trinidad/Tobago 43.751,00
Zimbabwe 30.224,80
TOTAL ACP countries 1.294.700,00
India 10.000,00
Total ACP/India 1.304.700,00
2. Arrangement on Special Preferential Sugar (SPS):
In addition to the Protocol sugar, the EU imports from the ACP countries presently 200.000 to
300.000 t special preferential sugar a year at duty free rates. The exact quantity depends on the supply
needs of the EU cane sugar refineries, the production of sugar cane in the French overseas territories
and the EBA sugar quota.
For SPS sugar imports a minimum purchase price is guaranteed which corresponds to the EU
intervention price for raw sugar reduced by the adjustment aid paid to the refining industry (price paid
in 2001/2002 : 49,68 Euro/100 kg; cif, free out of European ports of the Community).
3. EBA sugar
In 2001 the EU adopted the "Everything But Ar ms" (EBA) initiative which foresees a raw
sugar duty-free quota for refining purposes for LDC countries beginning in 2001/2002 at 74,185 tons
(white-sugar equivalent) up to 197,355 tons in 200 8/2009 (15% yearly growth). Starting from 2006,
the out-quota tariff rate (without quantitative limits) will be gradually reduced to 0 in 2009.
As for SPS sugar, a minimum purchase price is guaranteed for EBA sugar imported within
the quota which corresponds to the EU intervention price for raw sugar reduced by the adjustment aid
paid to the refining industry (price paid in 2001/2002: 49,68 Euro/100 kg; cif, free out of Europeanports of the Community).WT/TPR/M/102/Add.2
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4. GATT quota
Following the last enlargement of 1995 and pursuant to negotiations under Article XXIV.6
GATT, the EU opens annually a GATT quota of 85.463 t tel quel raw sugar for refining purposes at a
reduced tariff rate of 98 Euro/t. The quota is allocated to Cuba (58.969 t), Brazil (23.930 t) and other
third countries (2.564 t).
5. Imports from the Western Balkans countries
In the framework of the Stabilisation and Association process, Western Balkan countries
(Bosnia-Herzegovina, Croatia, Federal Republic of Yugoslavia, including Kosovo, and former
Yugoslav Republic of Macedonia) benefit from exceptional trade measures granting them free access
(duty free) to the EU market for agricultural products, including sugar.
What are the components in establishing the level of export refund on A and B quota sugar and in
incorporated products? What is the overall outlay on export refunds, including A and B sugar
ACP/India equivalent and on incorporated products? Is there a break down for each category? What
is the amount of the production levy collected from Member States, in total and at member level? In
regard to incorporated products, what is the product coverage and the breakdown in export refundsby sector?
A: In accordance with defined EU rules, the level of export refunds on quota sugar, including sugar
exported in certain processed goods, and on sugar imported under the ACP Sugar Protocol and the
Agreement with India, is fixed on the basis of the difference calculated between representative world
market quotations (current and future terms) and the EU intervention price for corresponding white or
raw sugar. More than 90 percent of the quantities for white sugar exports are fixed by tenderingprocedure, which in principle takes place every week. This procedure allows fixing refunds below the
level of calculated price differences and saving EU funds.
For refunds fixed outside the tendering system (small white sugar quantities, raw sugar, candy
products, syrups etc.) as well as for incorporated products, the refund level is derived from the lowest
bid of the relevant weekly tender in deducting a certain adjustment amount.The lists of processed products which may benefit of sugar export refunds are given in Annex V of
Regulation (EC) No 1260/2001 (OJ No L 178 of 30.6.2002) and in the Annexes of Regulation (EC)
No 1500/200 (OJ No L177 of 15.7.200).
The exports are operated within the limits of the EU WTO commitments (see under question 14).
Table 2 provides, for the 1999/2000 marketing year, details on the quota production broken down byMember States. The production levy collected for sugar from the Member States is calculated by
multiplying the A and B quota quantities with the corresponding single amounts of the production
levy and the additional coefficient fixed for that marketing year.
19
The Court of Auditors said that ‘C sugar’ (production in excess of quota), which receives no exportrefunds, can only be sold profitably at world market prices because the process obtained for sales of
quota sugar are sufficient to cover all the fixed costs of the processing company. Can the EU
explain/justify the statement (in paragraph 33, page 77 of the Secretariat report) that out-of-quota or
‘C sugar’ is exported without subsidies? How many enterprises produce C sugar? In which member
States is C sugar produced? Is any C sugar produced separately from A and B sugar?
                                                     
19By Regulation (EC) No 2267/2000 (OJ No L 259 of 13.10.2000) the single amounts for 1999/2000 were
fixed as follows :
- 1,2638 Euro/100 kg basic production levy on A and B quota sugar
- 23,6963 Euro/100 kg B levy on B quota sugar- coefficient of 0,18506 for the additional levyWT/TPR/M/102/Add.2
Page 192
A: As explained earlier, only EU quota sugar (and AC P/India sugar) is eligible to export refunds. EU
sugar produced outside the quotas may not be marketed on the EC market and must be exported
before 1 January following the end of the marketing year, except the sugar is carry forward to the next
marketing year. In the latter case, this sugar becomes part of the new year’s quota production. Table 2
provides details of C sugar production and carry over in the different Member States for the
1999/2000 marketing year.
Table 2
Sugar production, by quota
Sugar (1 000 t white sugar)
Basic quotas Production available
1999/00 (p)Breakdown
A
SugarB
SugarQuantity
of sugar
carried
over from
1998/99Crop
1999/00Production
of
A sugarProduction
of
B sugar
not carried
overProduction
of
C sugar
not carried
overQuantity
of sugar
carried
over into
2000/01
1 2 3 456789
11 982 2 610 1 340 17 922 11 761 2 531 3 367 1 603 EU-15
Belgique/België
Danmark
Deutschland
ElládaEspaña
France
(1)
IrelandItalia
LuxembourgNederland
Österreich
PortugalSuomi/Finland
Sverige
United Kingdom680
328
2 637
290960
2 996
182
1 320
-
690
316
73
134
336
1 040146
97
812
2940
806
18
248
-
182
74
7
13
34
10423
42
147
-
174
506
18
215
--
63
--
37
1151 092
552
4 380
232
1 105
4 803
216
1 705
-
1 117
501
76
166
431
1 546680
328
2 637
232960
284
182
1 320
-
690
316
64
134
336
1 040146
97
810
-
40
759
18
248
-
182
74
6
13
34
104207
127
860
-
127
1 199
16
91
-
165
111
-
1
61
40282
42
220
-
152
509
18
261
-
80
63
6
18
37
115
(1) Including French Overseas Departments
Source : European Commission, Directorate-General for Agriculture.
In: The Agricultural Situation in the European Union: 2000 ReportWT/TPR/M/102/Add.2
Page 193
Isoglucose production, by quota
Isoglucose (1 000 t dry matter)
Basic quotas Production (p)
199/00
Of which:
Isoglucose
AIsoglucose
BTotal A + B Isoglucose
C
10 11 12 13 14
EU-15
Belgique/België
Danmark
Deutschland
ElládaEspaña
France
(1)
Ireland
Italia
Luxembourg
Nederland
Österreich
PortugalSuomi/Finland
Sverige
United Kingdom252
57
-
29
1175
16
-16
-
7
-
811
-
2251
15
-
7
28
4
-4
-
2
-
21
-
6303
72
-
36
1383
20
)-
20-
9
-
1012
-
28303
72
-
36
1383
20
-20
-
9
-
1012
-
28-
-
-
-
--
-
--
-
-
-
--
-
-
(1) Including French Overseas Departments
Source : European Commission, Directorate-General for Agriculture.
In: The Agricultural Situation in the European Union: 2000 Report
How does the EU plan to apply protection mechanisms to the production of its future member
countries that are big sugar producers?
A: The Commission reminds that one of the basic principles of joining the Union is that the new
members have to adopt, to implement and to enforce effectively, from the beginning of the accession,
the ‘Acquis communautaire’, i.e. the existing EU legislation. As it was the case in previous
accessions, the new member will fully apply the instruments of the common market organisation for
sugar, in particular the production quotas, including the production levy system for refinancing the
export refunds, and the import/export regime.
Question from India:
India has bilaterally requested EC on several occasions to restore its original quota of 25,000 mt of
white sugar, deriving from the Commonwealth Sugar  Agreement. When can India expect restoration
of full quota?
A: The EC considers that this question is a bilateral issue, which is not relevant to the TPRM exercise.OtherQuestions from Argentina :
Vinos
Interesa conocer la opinión del a UE sobre ciertos aspectos de la Organización común del mercado
vitivinícola (Reglamento (CE) 1493/1999 del Consejo por su relación con intercambios comerciales.
Según el citado Reglamento – artículo 45 – salvo excepciones, no se permite la oferta ni entrega paraWT/TPR/M/102/Add.2
Page 194
el consumo humano de vinos – importados o no – que  hayan sido sometidos a prácticas enológicas no
autorizadas por la normativa comunitaria.
Se agradecerá que la Comisión nos indique si existen excepciones vigentes a prácticas
enológicas no autorizadas por la normativa comunitaria.
Se apreciará clarificar si, bajo el régimen de excepciones, puede darse el caso que la UE importe
vinos procedentes de terceros países sometidos a prácticas enológicas que no están autorizadas en el
territorio comunitario.Se agradecerá precisar, asimismo, si puede darse el caso que vinos sometidos a una práctica
enológica no autorizadas por la normativa comunitaria pueden ser importados en el territorio de la
UE si son procedentes de un determinante país (país A) y que, por el contrario, vinos sometidos a la
misma práctica enológica procedentes de un país diverso (país B), se vean impedido el acceso al
mercado comunitario.Por favor, explicar la compatibilidad de esta hipótesis con las obligaciones y derechos que deriven de
la cláusula de la NMF.
A: L'article 45 du règlement de base n°1493/1999 est effectivement correctement mis en oeuvre au
niveau communautaire. Les dérogations existent et sont couvertes par des actes du Conseil (procédurementionnée au § 2 du dit article: art 133 du Traité). Ces questions ont été posées plusieurs fois par
l'Argentine à tous les niveaux et jusqu'à une réponse du Commsissaire Fischler au ministre de
l'agriculture de l'Argentine). Enfin, la Communauté européenne est en négociation active avec
l'Argentine pour établir ce type de dérogation aux pratiques oenologiques applicables aux vins
importés dans la Communauté des pays tiers.
Question from India:
In the allocation of quota for mushrooms, it has b een observed that EU has been allocating quotas to
countries who do not have the capacity to fulfill even half of their quota. Although India is the third
largest supplier of mushrooms to EU, it has been  placed in the ‘others ‘ category and consequently
entitled to very limited quota. Although the quota al lotted to many of the quota holding countries is
not fully utilized, it is also not distributed to ot her countries. Under the Agreement on Agriculture,
WTO Members are obliged to administer TRQs in such a manner that the quota gets fully utilized.
The Members are bound to maintain entire TRQ even if reallocation becomes necessary. This position
has been upheld in the banana dispute case against the EU. EU is requested to clarify whether it
intends to address such anomalies in its TRQ system for mushrooms.
A: The EC paper on Disciplines on tariff quota administration which has been distributed to other
Members by the WTO Secretariat gives the position of the EC on this subject.
(2) FISHERIES
(i) Common Fisheries Policy (CFP)
(a) Conservation of fish stocks
Question from Australia :
How does the EU plan to further manage fisheries activities to ensure sustainable management of
marine resources, and how the issue of over-capacit y and industry subsidisation will be dealt with to
further assist these efforts?A: The Commission has issued a Communication to C ouncil with proposals on the reform of the CFP.
The reform is scheduled for completion and decision by Council and Parliament by end 2002. These
proposals reflect the approach concerning fisheries management in the Community. The main
instrument for management and conservation is the Total Allowable Catch (TAC). TACs are set forWT/TPR/M/102/Add.2
Page 195
the Community, including in certain specific cases also certain third countries, and then subdivided
into quotas for Member States, following the prin ciple of relative stability. The EC participates
actively in all Regional Fisheries Organisations in which it is a member or observer with a view to
sustainable management of fish stocks. The EC maintains its view that susbsidies which could
promote further fishing or over-capacity should be discouraged. Moreover, the EC participates
actively in the current discussions on susbsides in the fisheries sector in the FAO, UNEP, OECD and
the WTO.
Question from Norway :
As is the case within the European Community, Norway is deeply concerned about the present levels
of exploitation of important fish stocks in the Northeast Atlantic and in particular the detrimental
effects present fleet over capacity has on the sust ainable harvesting of fish stocks. The Commission’s
Green Paper on the future of the CFP points, inte r alia, to inadequate management measures as well
as substantial over capacity as major obstacles to su stainable fisheries. In this context, Norway notes
that the European Commission has proposed radical cuts in present fleet subsidies.
Could the Commission indicate its views on the possible benefits of improved multilateral WTO
disciplines on fisheries subsidies, not only to bolster autonomous measures in this field, but also toprovide for a more level playing field for fishermen who are competing on the same markets?
A: In trade policy terms, the Community would like to maintain a coherent approach of the current
Agreement on Subsidies and Countervailing Measures (ASCM) as regards all sectors falling under its
scope. We must first examine whether the existing generally applicable rules are deficient and, if so,
improve the disciplines maintaining their application to all sectors.
In fisheries policy terms, the Community wishes to emphasise that the fisheries negotiating mandate
straddles the trade (subsidies disciplines) and environment fields, thus providing an opportunity for an
integrated approach to the issue.
(b) Structural adjustments
Question from New Zealand :
We note the EC’s estimates that significant excess c apacity is one of the causes of resource depletion
in the fisheries sector (Secretariat report, para 48). In what ways will support to the fisheries sector
be modified to ensure that the industry is sustainable and that support is non trade-distorting?
A: As paragraph 48 of Chapter IV does not contain any reference to the issues raised by New Zealand
in its question, we assume that it is paragraph 47 of the Secretariat’s report New Zealand is referring
to.
First of all it should be noted that views quoted in the Secretariat Report are those of the Commission
and not those of the European Communities.
The current Community legislation foresees the review of the Common Fisheries Policy (CFP) in thecourse of 2002. It also provides that the Council shall decide before 31 December 2002 on any
necessary adjustments to be made.
On 28 May 2002 the Commission presented a reform package, containing a series of legislative
proposals (available at the EU web site www.europa.eu.int/comm/fisheries ).
Some of these proposals aim at reducing fishing effort under multi-annual plans. Further legal
proposals, reports and action plans will follow.
The above legislative proposals must be adopted by the Council of Ministers. The new CFP will enter
into force in 2003.WT/TPR/M/102/Add.2
Page 196
Question from Norway :
Para 45 indicates that in the view of the European Community, “ The Community has a shortfall in
fishery and aqua culture products and is a major importer of these products from non-Community
countries. The structural aid has only a very small influence on this situation”.
Could the Commission elaborate on why the substantial amount of 3,7 billion Euros for the period
2000 – 2006 is considered to be so insignificant as regards trade effects?
A: As stated in the Community’s notification document, (G/SCM/N/60/EEC) the objectives of the
structural measures in the fisheries and aquaculture sector are the following:
- To contribute to achieving a sustainable balance between fishery resources and their exploitation.
- To strengthen the competitiveness of structures and the development of economically viable
enterprises in the sector.- To improve market supply and the value added to fisheries and aquaculture products.
- To contribute to the revitalisation of areas that depend on fisheries.
From the above it appears that not all the Community aid is directed to areas related to trade.
In addition, the Community is in the process of re forming the Common Fisheries Policies. Within the
framework of this reform, the Commission has made proposals to redirect part of the funds to thegranting of aid to the sector to better accomp lish the above mentioned objectives and more in
particular to achieve a sustainable balance between fishery resources and their exploitation.
On the trade effects of these subsidies, it should be emphasised that the Community’s imports of
fishery products have continuously increased in the last twenty years. Some fish exporting countries
(capture fisheries and aquaculture) have substantially benefited from this trend. Some of those
countries have developed new markets in the Community for their products and have gained
substantial market shares.
(c) Common organisation of markets
Questions from Canada :
In Table IV.3, the EU notes that it maintains an autonomous tariff rate quota (ATRQ) for cooked and
peeled shrimp of 5,000 tonnes at 6%. The table doe s not mention that this ATRQ has an end-use
requirement (i.e., further processing) in order to qualify for this lower rate.
Please identify whether there are similar end-use requirements for the other items listed in Table IV.3,
and, if so, please enumerate them. Please indicate if  the EU would consider eliminating such end-use
requirements so that WTO members may make full use of these ATRQs.
A: As mentioned in the Secretariat’s report (par. 54), the suspensions and tariff quotas implemented
within the framework of the latest reform of the Community’s Common Organisation of Markets,
concern "fishery products intended for the processing industry ". To achieve this objective end-use
requirements must be specified to ensure that these products are not used for other purposes.
All the items listed in Table IV.3 are subject to the same end-use requirements. These are specified inthe implementing regulations (Council Regulations (CE) 104/2000 and 2803/2000). These regulations
are available at the Community’s web site www.europa.eu.int
As regards the last part of the first question, the Community does not consider that the end-use
requirements hamper the full use of the quotas. Some of the quotas listed in the table are fully used. In
addition, non-utilisation of the quotas can be related to weak demand for a particular product orbecause exporters are not able to supply customers’ demands.
Please indicate whether these quotas can be made  permanent and binding, given the stated reliance
by the EU on imports of fish products.WT/TPR/M/102/Add.2
Page 197
A: These tariff quotas and suspensions were opened on an autonomous basis, that is, without
compensation from other countries. Moreover, the volumes of the quotas are set in relation to marketsneeds and could be subject to changes.
Some of the quotas listed in the table will expire on 31 December 2003 (products covered by Council
Regulation (EC) 2803/2000). The functioning of these quotas will be reviewed before that date.
The Community advocates a comprehensive round of negotiations on market access for non-
agricultural products, without exceptions. MFN duty rate reductions on the products covered by these
measures (autonomous suspensions and tariff quotas) could be effected within the framework of the
ongoing negotiations.
Many of the autonomous quotas listed are for un limited amounts of the fishery product. Please
indicate if the EU is considering increasing the vo lume of fish imports subject to the other ATRQs.
A: Only autonomous tariff suspensions allow for the import of unlimited quantities. Tariff quotas are
for limited amounts. On the last part of this question, please refer to the reply given to the second
question.
Question from Norway :
Norway is a major supplier of fish on the European Community market and takes a keen interest in
improvements of market access for fishery products in the ongoing WTO-negotiations. In spite of the
fact that according to the Commission, about 70% of Community imports of fishery products are free
of duty, a number of important fish species, both unprocessed and processed, are subject to
substantial duty levels in the range of 10–25 %. Consequently, we do not share the view expressed in
para 54 that the import regime is “...generally open, by virtue of low tariffs...”Could the Commission indicate it’s views of the im portance of maintaining the present elaborate and
administratively complicated import regime for fish and fishery products as well as indicate possible
areas of further liberalization?
A: The full sentence of paragraph 54 that Norway partially quotes in its question reads as follows:
"These new trade measures complement a regime for imports of fishery products that is generally
open, by virtue of low tariffs (Table AIII.1), and the effects of preferences on originating products
granted under regional trade agreements (notably EFTA and the Cotonou Agreement) and GSP ".
Norway in the preamble of the question states that "In spite of the fact that according to the
Commission, about 70% of Community imports of fishery products are free of duty, a number ofimportant fish species, both unprocessed and processed, are subject to substantial duty levels in the
range of 10 – 25 % ".
With regard to the above statement by Norway, it should be noted that the Community, as mentioned
in paragraph 54 of the Secretariat’s Report, operates a series of preferential trade regimes in the same
way as Norway does (GSP, tariff preferences for LDC’s and Free Trade Agreements). Norway alsobenefits from a series of Community tariff preferences resulting from Protocol 9 of the EEA
Agreement and from bilateral trade arrangements.
The percentages mentioned by Norway in the introductory part of the question are MFN duty rates
applied to those countries that do not benefit from preferential trade regimes.
In its question, Norway qualifies the present Community’s import regime for fish and fishery productsas "elaborate and administratively complicated "
The Commission is of the view that the variety of duty rates applied on imports into the EU is not a
factor of complication as the Community, like Norway and other WTO Members, operates a series of
preferential import regimes that result in differentiated tariff treatment.
With reference to the non-tariff components of the Community’s import regime (technical barriers),
all the measures are made publicly available, are notified to the WTO and are similar to those applied
by other WTO Members. It should also be noted that most of the technical import regulations appliedWT/TPR/M/102/Add.2
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by the Community are also applied by Norway, within the framework of the EEA Agreement (see
paragraph 31 of doc. WT/TPR/S/70 "TRADE POLICY REVIEW - NORWAY - Report by the
Secretariat ")
On the last part of the question, the Commission would like to stress that Community is ready to
engage in a comprehensive round of trade negotiations and more in particular as regards markets
access.
(d) External agreements
Question from Brazil:
The EU intends to implement in the near futu re a new common fishing policy, which aims, among
other objectives, at recovering the communitarian stocks by means of a reduction in the aid provided
for fishing. Is there any mechanism in study that will prevent European fishing fleets from making upfor that difference by means of fishing in extra-EU waters, where they can cause the same depletion of
fishing resources as has been observed in EU fishing zones?
A: The Community sees to it that its fishing vessels operate outside Community fishing waters in a
manner which is fully consistent with the relevant provisions of the UN Convention on the Law of theSea (UNCLOS). In this context, and in pursuanc e of the co-operation and conservation requirements
enshrined in UNCLOS, the Community participates in a series of Regional Fisheries Organisations
that regulate fishing activities for a variety of species in their respective areas of competence.
The management of fish surplus resources inside third country waters is a major concern for the
Community. The fishing activities of Community fishing vessels are monitored through a series of
tight measures (detailed catch recording and reporting, the presence of observers, reports of vessel
movements, the regulation of fishing gear, etc). Community fishing vessels respect domestic rulesapplicable in the waters where they operate.
In the framework of the reform of the Common Fisheries Policy, the Commission is proposing a
series of actions in the area of international fisheries. These proposals will include:
- An Action Plan to eradicate illegal, unreported a nd unregulated fisheries (IUU) (already presented).
- An Action Plan to improve, at the regional and sub-regional levels, the evaluation of stocks that areaccessible to Community fishermen outside  Community waters.
- An integrated framework for fisheries partnerships at national and/or regional level.
The EU also intends to promote partnership actions  with third countries in order to put at their
disposal the necessary financial means for the implementation of a sustainable management of the fish
resources in their waters.
(3) F INANCIAL SERVICES
(i) Main characteristics
Question from Korea:
Please provide detailed information on the current status of European financial market integrationand its future prospects.
A: Paragraphs 58-83 contain the detailed information on the current status of European financial
market integration and its future prospects as requested by Korea.
Question from Costa Rica :
El inciso ii) básicamente hace referencia a los esfuerzos en el tema de servicios financieros a nivel
interno en el mercado europeo. ¿Qué esfuerzos de están haciendo tendientes a la apertura del
mercado hacia fuera de la Unión Europea? (párrafos 58-83.WT/TPR/M/102/Add.2
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A: EU policies are directly relevant to third-country financial service providers due to the
commitments made by the EU in the Fifth Protocol to the GATS, which entered into force on 1 March
1999. These commitments extend the principle of the single passport to third-country providers
subject to limitations placed on national treatment. Third-country financial services providers enjoy
the new access opportunities created by the progress on FSAP, but must also assume the new
obligations on financial service providers established in the EU.
(ii) Policy developments
(a) Overview
Question from Japan:
Japan would like to request the EU to introduce a sy stem in which products or services provided by
foreign enterprises, after being approved or licensed by one Member State, are automatically
accepted by other Member States, without any special requirement, or simply with the requirement of
reporting to the relevant authorities. Japan believes that the EU zone can in reality be regarded as a
single financial market with this system.
Japan would also like to request the EU to allow fo reign enterprises to complete application forms for
the approval or licensing of their products or services, which can be submitted to the regulatory
authorities in multiple languages and to harmonize the various formats and contents of the
application forms throughout the EU. It’s not only  burdensome for foreign enterprises to have to
complete application forms in the relevant languages in  each Member State, but it is also an obstacle
for the promotion of business in the EU. Japan be lieves that the above-mentioned modification of
procedures would contribute to improving bu siness environment in EU Member States.
A: The EU has to a large extent harmonised the conditions for establishment and operation of
financial services companies in the EU, but has no plans to harmonise the approval or licensing
procedures for financial products or services.
Question from Hong Kong, China:
It is noted that the core principle of the “single passport” is for the “host” Member State to recognize
the authorization granted by the “home” Member Stat e. It is also noted that the commitments under
the Fifth Protocol extend the principle to third-country providers subject to limitations placed on
national treatment. In fact, the host country may impose requirements on a financial service provider
to achieve imperative objectives (the principle of  the “general good”). Prima facie, it appears that
this would have nullified the single passport princi ple in practice, because the establishment by a
third-country provider in any host Member State does not guarantee the right of establishment in the
other Member States, which may maintain entirely different sets of requirements. We would be glad to
have the EU’s elaboration on how this is operated in practice and whether there can be a truely
single harmonized authorization throughout the Union.
A: The Community legislation in the area of financial services is the result of harmonisation of
Member States’ national legislation at a minimum level, based upon mutual recognition between the
regulators and the supervisors of the individual Member States. That mutual recognition is the
precondition for the a) the single passport, and b) home country supervisory control. It also impliesthat only companies incorporated by a head office or  a subsidiary in one of the jurisdictions covered
by mutual recognition will benefit from the right of establishment and the right to supply services on a
cross-border basis.WT/TPR/M/102/Add.2
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Third country financial companies that establish as subsidiaries in the Community would benefit, as
would the branches they chose to set up throug hout the Community from th eir EU-based subsidiary
(indirect branching).
Because no harmonisation has taken place at Community level regarding the establishment and the
operation of branches of third country financial firms in Member States, the latter remain free to set
the conditions for such establishment as well as the operating conditions. The European Commission
has no competence to intervene in the decisions taken by Member States in this regard.Directive 2000/12/CE relating to the taking up and the pursuit of business of credit institutions,
contains in its Annex I a list of activities subject to mutual recognition. Activities not included in the
list are thus subject to the rules of the EU Treaty and to national legislation, as are activities carried
out by branches, which are not covered by mutual recognition as stated above.
The mutual recognition in the insurance sector fo r instance, covers classes of insurance, but not
individual products. The latter is a matter of contract between the insurance company and the policy
holder. The European Community has no intention of intervening in this contractual freedom.
Finally, the implementation of the Financial Services Action Plan by 2005 will greatly enhance the
opportunities for financial services companies in the Community, to take full advantage of a truly
internal market.
Question from Mexico:
En el párrafo 66 del Informe del Gobierno de la Unión Europea (IG), se señala que los prestadores
de servicios financieros de un tercer país, podrán gozar de nuevas oportunidades de acceso creadas
en virtud de los progresos del FSAP, pero deberán asumir las nuevas obligaciones que para los
prestadores de servicios financieros establece la UE. Sobre el particular, ¿Puede la UE señalar o
precisar las nuevas obligaciones a que hace referencia en el documento?
A: The new obligations under the FSAP relate all to prudential measures, notably reporting
requirements, financial disclosure requirements, solvency requirements etc.
(b) Financial Services Action Plan (FSAP)
Questions from Japan:
Does the EU have any plan to introduce a single passport regime for the licensing of branches of
foreign financial institutions? Please comment on the view that an equal competitive opportunity is
not ensured for foreign financial institutions if the EU proceeds to harmonize or deregulate only
activities of financial institutions established or incorporated with in the EU. Should it leave theactivities of financial institutions established or incorporated outside the EU to those regulations
provided by the supervisory authorities of each Member State, this will result in a comparative
disadvantage for entry for foreign financial institutions with regard to branches. Please comment on
this.
A: The EU has no plans to introduce a single pass port regime for the licensing of branches of foreign
financial institutions.
Do the Council’s regulations of 1971 and 1972 allow the imposition of quantitative restrictions for
compulsory employment-related pension schemes (as considered by social security schemes)? If such
restrictions are allowed, which Member States impose such restrictions, and on what terms?
A: Council Regulations 1408/71 and 574/72 have as an objective to protect people who move from
one Member State to another in the field of social security. In other words, their aim is to avoid that
people who make use of their right to free moveme nt, would be punished in their social security
rights.WT/TPR/M/102/Add.2
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These Regulations are based on 'Principles’:
1. There shall be no conflicts of law; to this end the Regulations stipulate that a worker is insured inone Member state only: the State where he works, regardless his/her State of residence.
2. No discrimination based on nationality is allowed.
3. If, in order to be entitled to a benefit, you must prove having been insured for a certain period, then
periods of insurance completed in another Member state must be taken into consideration as well.
4. If you have acquired a pension right (see above point 3), then this pension must be paid out to you,wherever you reside in the EU.
Contrary to what is suggested by Japan, these Regulations do not apply to occupational pension
schemes(apart from one exception in only one Memb er State) They only apply to statutory schemes.
This means that these regulations do not impose any restriction or limitation on occupational pension
schemes.
What are the main aspects of the proposed regulations for a single market on supplementary pension
funds? Is there any possibility that such regulations permit discriminatory treatment on the
management of assets by foreign financial institutions or on foreign financial products?
A: The internal discussions concerning the supplementary pension funds are still taking place between
the institutions concerned. They are expected to be terminated by next September.
Question from Mexico:
En el párrafo 68 del IG la UE señala que a principios de 2000 y finales de 2002, el Consejo y el
Parlamento Europeo adoptaron 15 medidas legislativas bajo el FSAP, en materia bancaria, de
seguros, valores, así como legislación de aplicación trans-sectorial. A este respecto, ¿Puede la UEexplicar los alcances de dichas medidas, fechas de entrada en vigor y las principales innovaciones
respecto a las legislaciones vigentes?.
A: The legislative measures referred to by Mexico are listed in Table IV.4, including their date of
implementation. The text of these proposals can be found on the following web address, incl. inSpanish:
http://europa.eu.int/comm/internal_market/en/finances/actionplan/index.htm
Questions from the United States:
The Secretariat reports (in its summary observations)  that good progress has been made on achieving
the goal of fully integrated securities markets by 2003 and financial markets by 2005 as part of the
Financial Services Action Plan. Please provide additional details of this progress and explain what is
still to be done in fully achieving these goals.
A: Please refer to paragraphs 75 to 82 incl. of the Report by the Secretariat: Trade Policy Review
European Union, WT/TPR/S/102.
Mention is made of a mid-term review of the FSAP begun in early 2002. When will this review be
completed, and will the results of the review be made public in some form?
A: The mid-term review took place on 22 February 2002. The result is referred to in the 6th Progess
Report on the FSAP:
http://europa.eu.int/comm/internal_market/en/finances/actionplan/index.htmWT/TPR/M/102/Add.2
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(c) Banking
Questions from Mexico
La UE señala, en el párrafo 70 del IG, que ha decidido extender el marco regulatorio en materia
bancaria a fin de incorporar a las “electronic money institutions”. ¿Puede la UE explicar los
alcances y principales características del marco regulatorio aplicable a esta figura?
A: Directive 2000/46/EC introduc es a technology-neutral legal framework that harmonises the
prudential supervision of electronic money institutions to the extent necessary for ensuring their sound
and prudent operation and their financial integrity in particular. The approach adopted is appropriate
to secure the mutual recognition of authorisation and prudential supervision of electronic money
institutions, making possible the granting of a single licence recognised throughout the Community
and designed to ensure bearer confidence and the application of the principle of home Member Stateprudential supervision.
¿Puede la UE explicar en que consiste la regulación adoptada en materia de pagos transfronterizos
en euros?.
A: Regulation 2560/2001, of 19.12.2001 concerns cross-border payments in Euro within the
Community; the cost of such cross-border payments are not to be different from the cost of national
payments.
La UE señala que uno de los objetivos del FSAP en el área de legislación bancaria es la revisión de
los requerimientos de capitalización de los bancos. Sobre el particular, ¿Puede la UE señalar cuales
son sus objetivos en esta materia?
A: The objective is the implementation of new capital requirement framework in line with a new
Basel Accord.
(d) Insurance
Questions from Japan:
What is the EU’s position on the integration of non-life and life insurance businesses? If the proposed
Directive approves such integration, does this mean that foreign insurers (including those
establishing a commercial presence through branches) are allowed to conduct both non-life and life
insurance businesses?
A: The EU is not proposing to integrate life and non-life business.How does the creation of a single market for insurance intermediaries affect the insurance
intermediary markets? Will the establishment of such regulations result in a comparativelyunfavorable treatment of the activities of branches of foreign insurance intermediaries? Regarding
intermediaries for the cross-border supply of mari time, aviation and transport insurance, will those
intermediaries outside the EU be treated differently from those established with in the EU due to the
different supervisory policies of each Member State?
A: The proposal concerning a single market for insurance intermediaries will establish the Single
pass port. The conditions for establishment of branches will remain a Member State competenceWT/TPR/M/102/Add.2
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Questions from the United States:
How is reinsurance currently regulated by the Member States? Does the EU have any plans to extend
the "single passport" to the reinsurance sector?
A: Reinsurance is currently regulated by the individual Member States. The institutions of the EU are
currently preparing legislation which will extend the "single passport" to the reinsurance sector.
The Secretariat’s report notes that there is a proposed directive for insurance intermediaries. Has the
directive been approved by the Council and the European Parliament? Is the intent to establish a
single passport for suppliers of insurance intermediary services? Will Member states maintain some
regulatory rights, as under the "general good" clause applying to the life and non-life sector?
A: The institutions of the EU are currently preparing legislation covering insurance intermediaries; it
will extend the "single passport" to insurance intermediation. Member States will maintain some
regulatory rights, such as the "general good" clause.
The Secretariat report notes a proposed directive for occupational pensions. What is the definition of
"occupational pensions"? Has the directive been approved by the Council and the European
Parliament? Is the intent to establish a single passport for suppliers of occupational pension
services? Will Member states maintain some regulatory rights, as under the "general good" clause
applying to the life and non-life sector?
A: The definition asked for is referred to as:  "institution for occupational retirement provision", or
"institution", it means an institution, irrespective of its legal form, operating on a funded basis,
established separately from any sponsoring undertaking or trade for the purpose of providing
retirement benefits in the context of an occupational activity on the basis of an agreement or a contract
agreed:
- individually or collectively between the employer(s) and the employee(s) or their respective
representatives, or
- with self-employed persons, in compliance with the legislation of the home and host Member
States and which carries out activities directly arising therefrom;
- Legislation concerning institutions for occupational retirement provision is currently under
preparation; it will extend the "single passport" to such institutions; Member States will
maintain some regulatory rights such as the "general good" clause.
Does the single passport for th e life and non-life  sectors include cross-border supply issues
(cross-border from another country - not cross-border within the EU)?
A: No, the single passport for the life and non-life sectors does not include cross-border supply from a
third country.
How does the Directive relating to non-life insuranc e define a "large commercial risk"? Is this
definition static or is it subject to change?
A: The definition of "large commercial risk " is included in the Article 5 of Second Council Directive
of 22 June 1988 (88/357/CEE), published in the Official Journal No L 172 of 04.07.1988, page 1. The
definition is static.
Has the EU considering improving its cross-bord er insurance commitments, for which some Member
States do not take on commitments for Mode 1 supply of marine, aviation and transport insurance?WT/TPR/M/102/Add.2
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A: Concerning the EU proposals to expand Mode  1 commitments for MAT, please refer to the
requests form the EC and its Member States as handed over to the US on 30 June 2002.
Are there any Member States that do not permit branching (direct - not internal branching) to supply
insurance? When foreign companies establish a branch in the EU (direct), is it still the case that the
Member States retain the authority to regulate those branches according to Member State-specific
regulator` requirements?
A: All Member States permit direct branching from a third country; the conditions for such branching,
however, are still set by the authorities of each individual Member State.
(e) Securities
Questions from Japan:
Are securities (or investment) companies allowed to conduct the management of businesses for UCITS
without establishing a separate company? Are ther e no restrictions on investments via UCITS with
regard to foreign securities or bonds?
A: EU Member States have regulation on both securities and investment companies: investment funds
harmonised at European level (so-called UCITS, Di rective 85/611/EEC last amended by Directives
2001/107/EC and 2001/108/EC, OJ L 41 of 13.2.2002) and domestic investment funds, regulation for
the latter may be different. This answer refers to the harmonised UCITS types of investment funds.
Management of businesses for UCITS may only be done by delegation, i.e. the non-UCITS
undertakings obtain a mandate for doing certain activities, e.g. like management, from an authorised
UCITS management company, provided they fulfil the requirements for delegation.There are no investment restrictions for UCITS in the UCITS directive in regard to foreign securities
or bonds. However, as for European securities and bonds, the major part of the UCITS assets has to be
invested in listed securities/bonds or securities/bonds traded on regulated markets. Investments of
UCITS in units of non-UCITS investment funds are limited to 30%, this applies to European as well
as third-country non-UCITS funds.
(4) T ELECOMMUNICATIONS
Question from the United States:
Also, please explain what steps have been taken and are planned to be taken in achieving morecompetitive markets for telecommunications services and instituting the new framework fore-commerce.
A: Please read paragraphs 91 to 126 of the report.
(i) Policy developments
(a) Overview
Question from Japan:
The new regulatory framework for electronic communi cations came into effect in April 2002. Member
States are expected to adopt and publish the legislation necessary in order to comply with the new
framework by July 2003. We hope that such measures will be adopted smoothly by each MemberState.
A: The Commission is not aware of any problem in this respect.WT/TPR/M/102/Add.2
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Question from Korea :
What is the concrete criteria for distinguishing the cases where the events of actions have a European
dimension and therefore the Community level competition rules are applied and the other cases where
national competition laws are applied?
A: Cases with a Community dimension involve more than one member state; but in any case, the
application of Community competition policy or member state competition laws is not really an issue,since national competition laws mirror the Community competition rules; the issue is whether or not
the Commission needs to be involved or if a natio nal competition or regulatory authority can handle
the case.
(b) Local loop unbundling (LLU)
Question from Japan :
With regard to the “Interconnection Directive”, please explain how the European Commission
intends to proceed with regard to Member States  that do not abide by the requirement that “the
Reference Interconnection Offer shall include a description of the interconnection offerings broken
down into components according to market needs”, as mentioned in Article 7-3 of the InterconnectionDirective (Directive 97/33/EC). In addition, Japan reque sts the Commission to make it clear that the
“period for interconnection (including access to unbundled interconnection points in local loops)” is
included in part of the conditions that are to be described in the Reference Interconnection Offer, and
to notice this to all Member States.
A: Firstly, we check that our Member States transpose the directives into national law; this is reported
on in the annual implementation reports from the Commission; see eg,http://www.europa.eu.int/information_society/topics /telecoms/implementation/annual_report/7report/i
ndex_en.htm; in case Member States do not properly transpose and apply the legislation referred to by
Japan, then the Commission will undertake infringement procedures, as described on:
http://www.europa.eu.int/information_society/topics/telecoms/implementation/infringement/index_en
.htm; we can also confirm that Member States are required to ensure interconnection to be provided intimely fashion as required under the Reference Paper which is part of our commitments on
telecommunications services under the GATS, as requested by Japan in the second part of question 2;
Question from Taiwan :
Is “high speed bit stream access” available in De nmark, Germany, the Netherlands, Austria, Finland
and Sweden?
A: Bitstream access is not required under the LLU Regulation, and does not form part of the
obligatory Reference Unbundling Offer. However, fo r the information of the government of Taiwan,
bitstream access is available as a wholesale product to new entrants in all of the countries referred intheir question, with the exception of Germany. Furthermore, as far as the "speed" or data-rate of this
service is concerned, the government of Taiwan should note that this is determined on the basis of the
application of the principles of non-discrimination and technical feasibility in the context of
commercial negotiations between operators.
(c) New regulatory framework
Question from Japan :
With regard to the term “state involvement”, pl ease provide information concerning each Member
State’s plans for selling shares.WT/TPR/M/102/Add.2
Page 206
A: We are not aware of the availability of any plans by Member States for selling shares.
Question from Taiwan :
Please provide us with the reason for increasing the threshold of SMP (significant market power)
from 25% to 40% of the market share.
A: The SMP threshold has been aligned with the competiton law concept of dominance, and is
defined as follows: An undertaking shall be deem ed to have significant market power if, either
individually or jointly with others, it enjoys a position equivalent to dominance, that is to say a
position of economic strength affording it the power to  behave to an appreciable extent independently
of competitors, customers and ultimately consumers. Note that this is not a simple market share test.
The reason for the change is to better align sector specific regulation in the telecoms sector with the
general principles of competition(anti-trust) law
Question from Hong Kong, China :
It is glad to note that there is the new general authorization regime designed to replace the existing
individual licences so as to address the shortcomings in the existing regime. However, it is admittedthat in practice there is no such a general approach to authorizing market entry for communication
service providers, but a patchwork of 15 national regimes which themselves are widely divergent in
their basic approach and specific detail. We would be  interested to know if there is any follow-up
action to address the said problem.
A: The new Authorisation Directive will have been tranposed into national law by 25 July 2003; it
aims exactly to implement an internal market in electronic communications networks and servicesthrough the harmonisation and simplification of authorisation rules and conditions in order to
facilitate their provision throughout the Community;this new regime will therefore replace the
existing 15 national regimes, which Hong Kong refers to, by a new simpler and common regime
which will ensure that service providers across the European Union will not be required to supply
different information to member states' authorities in order to obtain the required authorisation toprovide services to the public.
Question from Korea :
As the Secretariat's Report shows, state involvemen t in the telecommunication market is still very high
in many EU countries except for the UK and Denmark.Please explain the future plan for further privatization of the telecommunication market.
A: State ownership or private ownership is not an issue (and is not dealt with in the WTO), what is at
stake is whether regulation is done in an impartial way by an effective and independent regulator
which is ensured as explained in paragraph 95 in the Secretariat’s report.
(5) E-C OMMERCE
(i) Main characteristics
Question from Canada:
Paragraph 107 mentions that the Commission is of the view that e-commerce either involves thephysical delivery of goods and is thus merchandise trade within the scope of GATT 1994, or involves
electronic delivery, and therefore falls within the sc ope of GATS. No mention is made, however, of the
EC’s Market Access (MA) and National Treatment (N T) obligations under the GATS. Please clarify
the nature of those GATS-sectoral commitments which it feels are most applicable to electronic
deliverables such as software and books.WT/TPR/M/102/Add.2
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A: EC commitments (as well as a number of other WTO members’ commitments) cover all services
involving consultancy on, development and implementation of software, as these are defined underCPC 842. Under CPC 842, software is defined as "the se ts of instructions required to make computers
work and communicate". CPC 842 also explains that "the customer may have a choice of using ready-
made programmes off the shelf (packaged software), developing specific programmes for particular
requirements (customised software) or using a combination of the two". Accordingly, it is the
understanding of the EC that software as defined as "sets of instructions required to make computerswork and communicate" is covered by the scope of CPC 842.
Question from Brazil:
Are the principles of the “e-Europe” Initiative, which has been renewed after the European Council
meeting in Seville, different from those adopted in  the Initiative launched in 1997? Should the answer
be in the affirmative, in what aspects is it different?
A: The principles of the eEurope initiative remain the same, but the content has been amended to
focus also on the availability of broadband access in both the current 15 EU Member States and in the
13 candidate countries.
(ii) Policy developments
Questions from Brazil:
What is the EU’s understanding of the definiti on of “place of permanent establishment” in e-
commerce? How should the theme “jurisdiction” be dealt with in the WTO Work Programme?
A: Place of establishment is to be determined in conformity with the case law of the European Court
of Justice, i.e., looking at the actual pursuit of an economic activity through a fixed establishment for
an indefinite period of time; this is not necessarily the place at which the technology used by an
information society service provider is located.
Does the EU intend to develop, in the future, a unified and harmonized system similar to the “Safe
Harbor” mechanism, which will allow a greater number of trade partners to share personal data of
consumers?
A: The EU is not intending to develop systems si milar to the safe harbor mechanism, that was
specifically designed for the US situation, to sh are personal data on consumers. The EU is however
studying possible means to allow compliance with all European legislation on transfers to third
countries using global instruments.
Regarding paragraph 12 of WT/TPR/S/102, could the EU provide more information on the new
framework for e-commerce? Is it possible to have a copy of the e-Commerce Directive (paragraph 55)and the e-Signatures Directive? How are foreign suppliers treated by those directives?
A: E-commerce directive: OJ L178/1 of 17 July 2000
E-signature: OJ L013 of 13 December 1999. The issue of foreign suppliers was already addressed in
the WTO Seceretariat report: the e-commerce directiv e being internal market legislation only applies
to suppliers established within the internal market, i.e. foreign (in the sense of third country) suppliers
are not treated in any way by the directive.
The text related to e-commerce mentions a “legal framework for e-commerce; a regulation on
jurisdiction and the enforcement of judgments in ci vil and commercial matters, with application to
relations between e-merchants in one country and customers in another; protection of copyright andWT/TPR/M/102/Add.2
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neighbouring rights in the information society; a nd the indirect taxation of services delivery by
electronic means” (paragraph 105). A copy of the Directives would help understanding the subject.Could the EU provide more information on the “indir ect taxation of services delivered by electronic
means”? The decisions affecting transfers of personal data to non-EU third countries are said to have
been “the source of friction” with them (also in paragraph 105). What kind of “friction” has been
caused?
A: The EU has taken decisions on the adequacy of  the data protection level of Switzerland, Hungary,
US safe harbor and Canada (PIPEDA act). These decisions are exclusively based on the level of
protection offered on the countries in questions but have indirectly consequences for the trade with
these countries, which is normally the reason for friction.
In the EU, the protection of personal data in ensured by Directive 95/46 of 24
th October 1995. The
Directive harmonises Member States’ data protection laws with a view to ensuring the free movement
of personal data within the EU while ensuring that the privacy of individuals enjoys a high level of
protection. Without the Directive, different national approaches to data protection would create
barriers within the EU’s internal market and the free movement of personal information would be
impaired.The Directive also establishes rules designed to ensure that data is only transferred to non-EU
countries when its continued adequate level of protection is guaranteed. Without such rules, the high
standards of data protection established by the Directive would quickly be undermined. One means by
which such "adequacy" can be determined is through a decision by the Commission based on a
country’s domestic law. The effect of such a decision is that data can flow to that third country
without any further safeguard being necessary.
In looking at how non-EU countries deal with pr ivacy, the Commission will first compare the rules
with those of the directive and then establish whet her the criteria laid down by the group of the data
protection commissioners are met. See to that extent the paper ` Transfers of personal data to third
countries: Applying Articles 25 and 26 of the EU data protection directive ´ adopted by the Article 29
Working Party in July 1998.
(http://europa.eu.int/comm/internal_market/en/dataprot/wpdocs/wpdocs_98.htm).
(b) E-commerce directive
Question from Taiwan:
Please explain why the “Data Protection Directive” restricts branch offices with their headquarters
situated outside the EU from providing information-related services in EU area.
A: This is a mistake. The paragraph in question refers to the e-commerce directive, not to the Data
Protection directive.
Questions from the United States:
How will the EU ensure that non-EU suppliers of digital products are treated in a nondiscriminatory
manner in the application of the VAT for electronic delivery of digital products?
A: VAT by its nature is a tax which always ensures neutrality between suppliers. For electronic
commerce, the recently adopted directive will remove the discrimination faced by EU businesses andensure that all operators are on a level playing field. In relation to the treatment of non-EU business,
there are no valid concerns on discrimination. There is nothing new in requiring non-resident
businesses to register and account for VAT in respect of taxable activities which they carry on within
the EU. What is now being done is to extend this to suppliers of certain on-line services who have
heretofore been exempt and had an unfair advantage over European operators. Under these new rules,
no additional obligations will will be imposed on non-EU suppliers selling to business customers inWT/TPR/M/102/Add.2
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the Union (i.e., B2B sales which account for at least 90% of the market). When selling to consumers,
they can avail of a simplified registration scheme is more business-friendly than the existing rules fornon-EU businesses, which either involve establishm ent in the EU or registration in each Member
State.
If a non-EU supplier is subject to more oner ous administrative and compliance requirements than an
EU supplier (e.g., the EU supplier calculates and collects one VAT rate - it's home market, while a
non-EU supplier must calculate and collect 15 diff erent VAT rates - the destination market), how is
that not discriminatory against a no n-EU supplier of digital products?
A: As regards the charging and calculation of tax, in any Member State the non-EU supplier will
always be required to charge exactly the same rate as a local supplier so there can be no question ofdiscrimination. For B2B, tax compliance and administrative procedures will generally be handled by
the purchasing company under reverse charge prov isions. Under the existing rules of the Internal
Market, an EU final consumer may however opt to buy from a supplier in another Member State
where the rate of tax applicable may be higher or lower. Although it is impossible to predict the
overall significance of such differences, it is probable that it will either be neutral or insignificant - taxrates are not the only factor in making a purchase decision and indeed high-taxing Member States are
sigificant providers of popular on-line content such as music. In practice, a non-EU supplier making
use of the simplified registration scheme provided for in the Directive will have administrative and
compliance obligations which are considerably lighter and simpler than those faced by a comparable
domestic operator. Rate calculation is in any event usually an automated function and we are not
aware of this presenting any burden to business. Moreover, the provisions are temporary in nature and
will be subject to review in three years.
In June 2002, RegTP in Germany announced it was mandating wholesale flat-rate pricing for
Deutsche Telekom. How is the adoption of wholesal e flat-rate pricing of leased lines for Internet
access proceeding in other EU Member States?
A: The situation in Germany is correctly described in the question; however, the second part of the
question should no doubt be rephrased to mean wholesale flat-rate pricing for Internet access - and
thus not for leased lines which are priced according to capacity offered and not actual traffic flow; the
Commission currently does not have statistics available from EU Member States about the availability
of wholesale flat-rate pricing for Internet access in other Member States; this information is likely tobecome available only during the coming months.
(c) Processing of personal data and protection of privacy
Question from Canada:
Paragraph 113 states that on 14 January 2002, an “adequate” level of protection was also
recognized for transfers of certain personal data from the EU to certain locations in Canada. A
Commission Decision (220/2/EC) recognizes the “adequacy” of Canada's Personal Information
Protection and Electronic Documents Act (PIPEDA) in meeting the requirements of the EU Data
Protection Directive (95/46/EC). While the Commission Decision is limited to the scope of the
PIPEDA, no specific geographical limitation on data tr ansfers is provided for. Accordingly, please
explain why the Commission has included the phrase “to certain locations in Canada” in the
paragraph.
A: The phrase `to certain locations´ was included to make clear that the adequacy decision does not
apply to the whole country as it is a partial decision, that does not apply to the whole country as it is
linked to the application of a specific piece of legislation.WT/TPR/M/102/Add.2
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The Canadian PIPEDA Act applies to private sector organisations that collect, use or disclose
personal information in the course of commercial activities. Initially the Act only applies toorganisations that are regulated at a federal level (federal works, undertakings or businesses) such as
airlines, banks, broadcasters, inter-provincial transportation companies and telecommunication
networks and to the disclosure by organisations (whether they are federally regulated or not) of
personal information for consideration outside a province or outside Canada. The Act also applies to
all businesses in the Territories as they are deemed to be federal works. The information itself must be
the subject of the transaction and the consideration is for the information. As of 2004 it will apply to
all sectors except in cases where provinces have passed privacy legislation that has been deemed to be
substantially similar. If a province passes legislation that is deemed substantially similar, the
provincial legislation will apply to the intraprovincial collection, use or disclosure of personal
information.
Questions from Taiwan:
Please describe the status of consultations with third countries on carrying out the Data Protection
Directive, and how the EU judges whether a thir d country has reached a level of personal data
protection that would enable it to exchange data with EU members.
A: In the EU, the protection of personal data in ensured by Directive 95/46 of 24th October 1995. The
Directive harmonises Member States’ data protection laws with a view to ensuring the free movement
of personal data within the EU while ensuring that the privacy of individuals enjoys a high level of
protection. Without the Directive, different national approaches to data protection would create
barriers within the EU’s internal market and the free movement of personal information would be
impaired.The Directive also establishes rules designed to ensure that data is only transferred to non-EU
countries when its continued adequate level of protection is guaranteed. Without such rules, the high
standards of data protection established by the Directive would quickly be undermined. One means by
which such "adequacy" can be determined is through a decision by the Commission based on a
country’s domestic law. The effect of such a decision is that data can flow to that third countrywithout any further safeguard being necessary.
In looking at how non-EU countries deal with pr ivacy, the Commission will first compare the rules
with those of the directive and then establish whet her the criteria laid down by the group of the data
protection commissioners are met. See to that extent the paper `Transfers of personal data to third
countries: Applying Articles 25 and 26 of the EU data protection directive´ adopted by the Article 29Working Party in July 1998
(http://europa.eu.int/comm/internal_market/en/dataprot/wpdocs/wpdocs_98.htm).
After the decisions on Switzerland, Hungary, US sa fe harbor and Canada (PIPEDA act), the European
Commission is presently studying the situation in a number of other countries which have approached
the EU on this issue.
(d) Indirect taxation of deliveries of goods and services contracted over the Internet
Paragraph 117 refers to two different types of Value-Added Tax (VAT) arrangements which are
applied to off-line delivery of goods. Please clarify the differences between VAT arrangements for
“destination principle” and for “distance sales”.
A: The "destination principle" is fundamentally the idea of taxation at the place of consumption. This
stands in contrast to the "origin principle", the concept of taxation based on the jurisdiction of the
supplier.
The "distance sales" regime generally applies to sales of goods by a supplier destined principally to
final consumers (as opposed to taxable persons) in another Member State. This regime addresses theWT/TPR/M/102/Add.2
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reality of an EU supplier facing a multitude of consumers based in different Member States. The VAT
applies based on the "origin principle" up to a threshold for sales established by the Member State ofdestination. The threshold is set at EUR 100 000 (based on supplies of goods to the Member State of
destination in the previous calendar year), but may be reduced to EUR 35 000 by the Member State of
destination where it fears that the threshold of EUR 100 000 would lead to serious competitive
distortions.
Paragraph 118 describes the EU Directive and Re gulation governing the application of the VAT to
electronic deliveries. Given that EU-based suppliers of digital products will be required to register in
the country in which they are located and to levy the VAT at the rate applicable in that country,
please clarify the criteria for “business presence”. Specifically, please clarify whether the VAT-rate
that EU suppliers would apply to digital products is to be determined solely on the basis of thecountry in which the company is incorporated or whether the VAT-rate could also be based on the
jurisdiction in which the company operates (i.e. the company is incorporated in Germany, but has its
operation - which is not a separate legal entity - in Portugal).
A: "Business presence" is not term found within EU  VAT legislation. Rather, this is a concept which
has crystallised as a result of the work carried out by the Working Party 9 Sub-group on Electronic
Commerce at the OECD. Published guidelines on the place of consumption include the following:
The place of consumption for cross-border supplies of services and intangible property that are
capable of delivery from a remote location made to a non-resident business recipient should be the
jurisdiction in which the recipient has located its bus iness presence. A footnote to this guideline added
that "[t]he 'business presence' is, in principle, the establishment (for example, headquarters, registered
office, or a branch of the business) of the recipient to which the supply is made."In the EU, Article 9(1) of the Sixth Directive sets out a broad principle that the place of supply of a
service is deemed to be the place where the supplier has established his business or has a fixed
establishment from which the service is supplied. In absence of a place of business or fixed
establishment, it is the place where the supplier has his permanent address or usually resides. This
deeming rule, it should be noted, is subject to a number of exceptions.With regard to the specific example provided, ultimately the response would be predicated on the
particular facts of the situation. As previously noted, the place of supply will be where there is a fixed
establishment from which a service is supplied. Where the German company provides services to
consumers through the Portuguese branch, VAT is payable on those services in Portugal if that branch
has the human and technical resources characteristic of a fixed establishment, and the service is
actually provided by the branch. Otherwise, the supply would be subject to German VAT.
Furthermore, has the EU determined what the ef fect this Directive would have on the ability of
foreign suppliers to compete with local EU suppliers in the EU market?
A: No formal study has been undertaken regarding the ability of non-EU suppliers to compete with
EU established suppliers in the EU market. It is recognised that decisions Member States have taken
on tax rates may enable certain EU suppliers to charge a lower amount of tax when selling to
consumers in other Member States, versus non-EU vendors participating in the special scheme selling
in the same locale and charging the local rate. Although it is impossible to predict the overallsignificance of such differences, it is probable that it will be either neutral or insignificant. Moreover,
it must be recognised and acknowledged that tax rates are not the only factor in making a purchase
decision and, indeed, higher taxing Member Stat es such as Ireland and Sweden are significant
providers of online music within the EU.
Additionally, it is important to remember that approximately 90% of the online electronic commerce
business that occurs presently is business to business and no change in business practices will beWT/TPR/M/102/Add.2
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required for non-EU vendors. The new special scheme will only apply with respect to the 10% of
sales involving final consumers.Finally, it is worth noting that the matter of the place of supply of services with regards to intra-
Community transactions is under review, and the online supply of digitized content is but one of the
matters to be considered.
Question from Taiwan:
Collection of value-added tax online will lead to consumers’ privacy disclosure. Please advise if there
are any precautious measures being adopted.
A: Any measure taken at European level will have to respect the rest of the existing EC legal
framework, including the EU data protection directive.
Questions from Brazil:
As stated in paragraph 56 of WT/TPR/S/102, the EU has adopted a new policy on value added
taxation of electronic deliveries of information society services (e.g., software, music, video). How
does this policy impact services providers established outside the EU?
A: The VAT and E-Commerce Directive of 7 May 2002 will modify the rules for applying VAT to
certain digitized services (e.g., software and broadcasting). It comes into effect on 1 July 2003 and
removes a double competitive handicap faced by EU e-commerce firms.
It will ensure that EU suppliers will no longer be obliged to levy VAT on sales of these products in
markets outside the EU.
Where non-EU businesses sell to EU final consumers,  they will be required to collect and remit
applicable VAT, similar to EU businesses.
Non-EU businesses can meet their tax obligations by registering with a tax authority in any one
Member State of their choice under a ‘special scheme’, or by establishing in Member State, thus being
subject to the same rules as EU businesses.
On the application of VAT for a service supplied electronically, is it necessary for the consumer to
inform the supply of the service or are there other means to identify the consumption of a service?
A: This is not specified in the Directive but is an implantation question for Member States. In
practice, it will be based on self declaration by the customer but, where appropriate, this can be
verified against geo-location data or credit card billing address.
Question from Chile:
El informe menciona la adopción de una nueva política para gravar con impuesto añadido, los
suministros electrónicos de servicios de la sociedad de la información (tales como los programación
informática, música o video) entregados a ciudadanos de la UE por prestadores extranjeros, sobreeste tema, la delegación de Chile quisiera solicitar las cifras relativas a los montos, números de
prestadores y procedencia de los servicios que se han visto afectados por la aplicación de este
impuesto.
A: The figures relating to VAT losses, the number of affected suppliers and the country origins of
persons supplying services to EU persons is not available. However, in one of the better known cases,
it is thought that offshore Internet service providers had an EURO65 million advantage per annum
over competitors in the UK market alone. The Directive will rectify this unfair treatment faced by UK
competitors. Further, it is important to recall that the E-Commerce VAT Directive only affects
supplies made to consumers, not business, and this constitutes approximately 10% of the present
market.WT/TPR/M/102/Add.2
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Question from India:
It is reported that EU has discriminatory VAT for offshore suppliers (i.e. companies not established or
not having principal place of business in EU) of  telecommunications and online services. Does EU
plan to do away with such discriminatory VAT treatment?
A: VAT by its nature is a tax which always ensures neutrality between suppliers. For electronic
commerce, the recently adopted directive will remove the discrimination faced by EU businesses andensure that all operators are on a level playing field. In relation to the treatment of non-EU business,
there are no valid concerns on discrimination. There is nothing new in requiring non-resident
businesses to register and account for VAT in respect of taxable activities which they carry on within
the EU. What is now being done is to extend this to suppliers of certain on-line services who have
heretofore been exempt and had an unfair advantage over European operators. Under these new rules,no additional obligations will will be imposed on non-EU suppliers selling to business customers in
the Union (i.e., B2B sales which account for at least 90% of the market). When selling to consumers,
they can avail of a simplified registration scheme is more business-friendly than the existing rules for
non-EU businesses, which either involve establishm ent in the EU or registration in each Member
State.As regards the charging and calculation of tax, in any Member State the non-EU supplier will always
be required to charge exactly the same rate as a local supplier so there can be no question of
discrimination. For B2B, tax compliance and administrative procedures will generally be handled by
the purchasing company under reverse charge provisions. Under the existing rules of the Internal
Market, an EU final consumer may however opt to buy from a supplier in another Member State
where the rate of tax applicable may be higher or lower. Although it is impossible to predict the
overall significance of such differences, it is probable that it will either be neutral or insignificant - taxrates are not the only factor in making a purchase decision and indeed high-taxing Member States are
sigificant providers of popular on-line content such as music. In practice, a non-EU supplier making
use of the simplified registration scheme provided for in the Directive will have administrative and
compliance
 obligations which are considerably lighter and simpler than those faced by a comparable
domestic operator. Rate calculation is in any event usually an automated function and we are notaware of this presenting any burden to business. Moreover, the provisions are temporary in nature and
will be subject to review in three years.
(6) O THER SERVICES SECTORS
Postal Services
Question from the United States :
The Secretariat reports that progress has been slower in (1) opening the non-household markets in
electricity and gas to competition by 2004, (2) establishing cross-border electricity interconnectivity
of at least 10 percent of production capacity by 2005, and (3) opening postal services currently
reserved for the incumbent provider toward the prospect of full liberalization by 2009. Please providemore detail concerning what has been done, what steps were planned that have been delayed, and
what steps remain to be taken on each of these issues in the immediate future.
A: On postal services:
In 1992 the Commission issued the ‘Green Paper on th e Development of the Single Market in Postal
Services.’ This provided an analysis of the sector and set out the main objectives of Community
policy for postal services. These were to improve the quality of service and to implement the internal
market for postal services.
Towards these objectives, and in line with the principle of subsidiarity, the Postal Directive 97/67 set
in place a limited harmonisation of EU postal services.WT/TPR/M/102/Add.2
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It established regulatory provisions including :
The definition of a minimum universal service for all users comprising of at least one delivery andcollection five days a week.
A maximum reservable area of 350 grammes and five times the basic tariff of an item of
correspondence.
To safeguard the universal service, Member States could establish authorisation procedures, which
may include individual licences and a compensation fund in the universal service area.That there should be reasonable and good access to the network, and that this access should be
transparent and non-discriminatory.
Member States were required to establish National Regulatory Authorities independent from the
postal operators.
That USPs should apply transparent and separated cost accounting principles and provide separateaccounts for reserved and non-reserved universal services and non-universal services.
That there should be Quality of service targets for cross-border mail- 85% for delivery after three
days, (D+ 3), 97% for delivery after 5 days, (D+5) and that there should be harmonisation of technical
standards.
That Member States should ensure that adequate customer protection measures were put in place, forexample in regard to complaints and redress procedures.
These provisions, mainly focused on principles and boundaries, established a Community framework
for Member States to adapt to their national context. They have been largely implemented in the
Member States and the Postal Directive 97/67 has led to the following changes:
A largely achieved implementation of a Community universal postal service; In practice the universal
service exceeds the minimum requirements of the Directive in most Member States, for example 10
Member States have adopted a 20kg maximum limit for parcels collection and five have dailycollection and delivery on six days a week.
The maximum reservable area is implemented across the Community, with many Member States
going further in opening their market, for example Sweden, which has no reserved area, Germany
where the reserved area has been reduced to 200g, and 50g for direct mail, and the Netherlands, where
it has been reduced to 100g.Implementation of additional safeguards for the universal service in some Member States.
Authorisation systems are in place in 8 Member States and provisions for licencing in 9 Member
States. Though 7 Member States have included provisions for a compensation fund, only one so far
has plans to activate such a fund. 
Good and reasonable access to national postal services has been more than achieved, with theindependent consultants CTCon suggesting that there is possibly an over provision in the European
postal access infrastructure, which has five times as many access points per square km as in the US.
14 out of the 15 USPs have now implemented a transparent and clearly separated cost accounting
system in accordance with Article 14 of the Directive.
The quality of service standards set by nearly all the Member States now comply with Directiverequirements.
Though the implementation of Directive requirements for arrangements for customer complaints
varies customers are adequately protected in Member States.
The European Committee for Standardisation (CEN) ha s been developing European standards for the
postal sector since 1996. On 14 January 2002, the first European standard for measuring the quality ofservice (EN 13850) was adopted by the CEN.
National Regulatory Authorities (NRAs) have been established in all Member States and, although
full independence of the NRA from the postal operator is not applied in all Member States, some of
the NRAs are demonstrating clear independence and promoting competition in their Member States.
Application of the Postal Directive 97/67 has, therefore, led to significant measures of regulatory
codification and harmonisation. Further, the Postal Directive has led to significant improvements in
the quality of service. 92.3% of Community cross-border priority mail was delivered in D+3 in 2001WT/TPR/M/102/Add.2
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(compared with only 69.1% in 1996)20. The harmonisation of the USPs’ performance, both cross-
border and domestic, has mitigated the "frontier effe ct". and quality of service measurement standards
being developed by CEN should further enhance monitoring and performance.
This first step towards the accomplishment of the internal market for postal services has also provided
the catalyst for rapid market developments which have included :
The USPs have moved, from commodity service providers to a more business-oriented organisation
and culture, to take advantage of new commercial opportunites. This trend towards the corporatisationof the USPs has led them to adopt new business strategies focusing on cost efficiency, profitability,
diversification and expansion. The strength of this movement has varied across Member States and,
arguably, those who have moved furthest along this route have enjoyed some first mover advantage.
However, most USPs have now become commercial and profitable business organisations, even
though levels of productivity vary;Whilst there has been only limited competition in the mail market segment, the parcels and express
markets are fiercely competitive. However, the USPs  have been able to increase their share of the
competitive market segments.
The USPs’ movement, from commodity service operators to delivery service providers, has changed
their activity portfolios, generally reducing their dependence on the mail market segment;Expansion (mainly into transport/logistics), product  innovation and the use of outsourcing are blurring
the traditional boundaries of the postal sector.
The postal services market has continued, in general, to be characterised by growth in all market
segments, and particularly in the direct mail segment.
These developments have carried clear benefits for postal customers, such as increased quality of
service, increased efficiency, greater financial security for the USPs and greater innovation in the
sector. Further, as a result of these market changes, the USPs are generally now in a far strongerposition to cope with the demands of a more competitive market.
The Postal Directive 97/67 has also helped to create an expectation of further measures of market
opening, and this expectation has increased both the pace of national postal reform and that of the
restructuring of the postal sector towards concentration, efficiency and profitability.
However, the internal market for postal servic es remains unaccomplished and, to move further
towards this, the European Parliament and Council have recently agreed a new Postal Directive,
Directive 2002/39.  This confirms the current universal service definition and adds further elements on
access conditions, where it requires that tariffs ‘shall take account of avoided costs’, and customer
redress procedures have been extended, as the Directive requires that ‘transparent, simple and
inexpensive procedures are drawn up for dealing with  users’ complaints’ and that this principle should
also be applied to ‘beneficiaries of services’ outside the scope of the universal service or inside the
unversal service but not provided by the USP.
The Directive also requires two further steps of market opening, the first establishing a reduced
maximum of reserved services, of below 100g and three times the public tariff21 in 2003, and 50g and
two and half times the price in 2006. These steps will open a further 16% of USPs’ revenues tocompetition.
Further, the Directive requires that in 2006 there s hould be a further study towards a ‘decisive step’
towards the ‘full accomplishment of the internal market for postal services in 2009’.
These developments suggest that the journey towards the single market for postal services, begun in
1992, is now nearing completion, and that as a result users are benefiting from better quality ofservice and a more efficient universal service provision.
                                                     
20 Source: UNEX results (International Post Corporation)
21 This refers to the public tariff for an item of co rrespondence in the first weight step of the fastest
standard category.WT/TPR/M/102/Add.2
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Question from Brazil:
In paragraph 15 of document WT/TPR/G/102, the report mentions “further liberalization of postal
services, a Directive establishing the legal framework for e-commerce, a new telecommunications
package which will encourage greater competition and protect consumers, the European Company
Statute and the legislation in the Commission’s Financial Services Action Plan”. Is it possible to have
more detailed information on these measures and a copy of the legislation?
A: The regulatory framework in the EC for postal services is contained in the directives:
- n°97/67 of the European Parliament and of the Council of 15 December 1997 on common
rules for the development of the internal market of Community postal services and the
improvement of quality of service (OJ L015, 21/01/1998, p. 0014-0025)
- n° 2002/39 of the European Parliament and of the Council of 10 June 2002 modifying
directive 97/67.
For more information on the genesis of the last directive and its impact on the liberalization of the
market, it possible to consult the website of the Directorate-General of the internal market of the
European Commission at: http://www.europa.eu.int/comm/internal_market/fr/postal/index.htm
E-commerce and telecommunications:
http://europa.eu.int/information_society/topics/telecoms/regulatory/new_rf/index_en.htm  and
http://europa.eu.int/comm/internal_market/en/ecommerce/index.htm
Company law: http://europa.eu.int/comm/internal_market/en/company/company/index.htm
Financial services: http://europa.eu.int/comm/internal_market/en/index.htm
In general, what is the European proposal for liberalization of the postal services market like? Is
there any estimate as to when it might be approved by the European Parliament?
A: The regulatory framework in the EC for postal services is contained in the directives:
- n°97/67 of the European Parliament and of the Council of 15 December 1997 on common rules for
the development of the internal market of Community postal services and the improvement of quality
of service (OJ L015, 21/01/1998, p. 0014-0025)- n° 2002/39 of the European Parliament and of the Council of 10 June 2002 modifying directive
97/67. For more information on the genesis of the last directive and its impact on the liberalization of
the market, it possible to consult the website of the Directorate-General of the internal market of the
European Commission at:
http://www.europa.eu.int/comm/internal_market/fr/postal/index.htm
Air services
Question from New Zealand :
When can a final ruling be expected from the European Court of Justice as to whether the negotiation
of the international air services agreements is a Community competence? Has the EC begun to
consider the implications of such a ruling for ex isting agreements with third countries, and for the
negotiation of future agreements?
A: The European Court of Justice is currently preparing its final ruling in the case on the so-called
"open-skies" air transport agreements, that the Commission has filed against eight Member States.The Advocate General issued his opinion in February, and the final ruling can be expected later this
year, though no specific deadlines are applicable.
When the judgement is issued the EC will have to study it carefully before deciding on the most
appropriate course of action.WT/TPR/M/102/Add.2
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Questions from the United States:
Did the EU amend Council Regulation 95/93? If so, pl ease explain the content of the revision. If not,
please explain why and elaborate on what steps have or are still being taken to address the issue of
slot allocations.
A: The regulation is in the process of being amended. During its 10 June 2002 Plenary Session, the
European Parliament approved subject to a number of amendments the Commission's proposal for aEuropean Parliament and Council Regulation ame nding Council Regulation (EEC) No 95/93 of 18
January 1993 on common rules for the allocation of slots at Community airports. A revised proposal
has been submitted from the Commission on 7 November 2002
22..
This proposal entails a technical revision of the current regulation the general objective of which is to
ensure that the available capacity with regard to slots is administered and used efficiently on the basisof neutral, transparent and non-discriminatory procedures providing for clear criteria for the allocation
of slots and sanctions against abuses. At this stage, the intention is not to make fundamental changes
to the current system of slot allocation that is largely based on slots with 'grandfather rights' allowing
the air carriers to continue using their slots as long as they comply with the usage requirements.
What became of the proposal for a Directive on ai rport charges? Did it become permanent? If not,
what is the status of the pending Directive?
A: The proposal on a directive on air port charges that was under consideration in 1999 has been
withdrawn.
Questions from Brazil:
According to the report by the Secretariat (p. xiii), the Commission proposed a new instrument to
react against unfair competition from subsidized th ird-country airlines. Could the EU better explain
this new instrument and outline its components in further detail?
A: The European airline industry is faced with a critical challenge: the need for it to compete with
third-country airlines which benefit from generous subsidies, while the airline industry in the
European Community is subject to strict rules on government aid.
The recent crisis in some parts of the industry has led third-country governments to subsidise their
airlines in a manner which is likely to distort competition. Community airlines have provided
information about the pressure which these airlines exert on ticket prices and to which they are unableto respond.
Additionally, subsidisation is not the only type of state-involvement which can result in distortion of
international supply of airline services. Pricing practices by foreign air carriers may be at unfair levels
by virtue of them being state-controlled rather than being openly subsidised. In fact, any subsidies
granted by foreign governments to carriers they themselves control would be extremely difficult todetect.
Some third countries have introduced instruments to  deal with such situations. Also the Community
has, for the maritime sector, provided for redress in case of unfair pricing practices. However, for the
airline sector, no such possibility exists at the Community level. The only currently available means
are bilateral agreements which often lack, both in terms of coverage and remedies, the potential toprovide swift and comprehensive protection against subsidisation and unfair pricing practices. Indeed,
even if one of the countries member of the European Union had been able to take any action under its
bilateral agreements, this would have just widened the gulf even further between the ways in which
different Community airlines are treated.
                                                     
22 COM(2002)623 final of 7.11.2002 - 2001/0140 (COD)WT/TPR/M/102/Add.2
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The proposed instrument is designed to address this problem. It will allow Community action against
unfair competition from non-Community carriers on routes to and from the Community due to trade-distorting third country subsidies. Additionally, it will provide for a remedy against unfair pricing
practices by state-controlled air carriers. Cases will be examined on the basis of industry complaints
which show that such subsidies or unfair pricing practices are causing injury on certain routes. The
investigation and decision-making processes are based predominantly on existing practices in the area
of trade in goods but allow sufficient flexibility to deal with the specific problems of the airline sector.The architecture and components of the proposed Regulation can be summarised as follows:
-Principle:
The proposed instrument allows action against subsidised or certain unfairly priced and injurious air
services supplied by non-Community carriers on certain routes to and from the Community. It
contains simple and workable rules of substance and procedure but, at the same time, does not requirethe EC to go below the tested standards applied in the goods area.
-Practices covered:
The proposal uses the subsidy definition of the WTO Agreement on Subsidies and Countervailing
Measures. Trade distorting subsidies granted by foreign governments, i.e. subsidies targeted at certain
enterprises or sectors and export subsidies are actionable (generally available subsidies e.g. to allservice providers including airlines are considered not to be trade distorting). Additionally, it takes
over in large part the definition of "unfair pricing practices", i.e. the charging at fares at levels below
those charged by a established and representative carriers (or, if this information is not available,
below the constructed rate, i.e. costs plus profit of other comparable carriers), but limits it to such
practices conducted by state-controlled air carriers.
-Investigation:
The proposal provides for all features of a trade in goods type investigation but in a simplified andless binding manner. An investigation would be defined by two parameters:
- Subsidies given by a certain government to eligible foreign carriers or unfair practices by
certain state-controlled foreign carriers
- certain routes where our industry faces problems.
The draft introduces a definition of "like air service" which is, however, less restrictive as in trade ingoods. The EC carriers would have to fly on the same or almost the same routes as the foreign carriers
but there are no restrictions concerning the type of service supplied. The investigation covers at least
"a major proportion" of EC supplied services.
-Initiation threshold:
The airline industry of the European Union has a right to initiation if the duly substantiated complaintis made on made on behalf of Community industry. Additionally, the Commission can open ex officio
if there is sufficient evidence.
-Due process:
Public notice is given at initiation, foreign carriers and other interested parties have the right to be
heard, measures are published in the Official Journal of the European Communities. Rules on non-co-operation are necessary to be able to draw adverse inferences.
-Measures:
Measures (duties, undertakings or other appropriate measures e.g. restriction of landing rights) will be
imposed on a per-carrier basis. The level of the measure is capped at the amount of subsidy in terms
of benefit to the recipient (or the difference between the actual fare charged by a state-controlledforeign air carrier and the "normal fare") or a level which is sufficient to remove the injury, whatever
is the lower. Provisional measures have a duration of 6 months. Measures may be reviewed if
warranted. Similar as in the goods area, there is no provision on how duties are levied. In practice, the
Member State authorities collecting an "airport tax" could also collect the duty.WT/TPR/M/102/Add.2
Page 219
Audiovisual Services
Questions from Brazil:
What is the existing legal framework for competition in audiovisual services? Has there been any
change to it in the last two years?
A: At Community level, there is no specific competition regulatory framework for audiovisual
services. Community competition rules, including merger Regulation apply to the audiovisual sectoras to other sectors.
At national level, apart from implementation of general competition rules, specific rules may be
aiming at preserving competition and pluralism in the audiovisual services.
No specific evolution has been noted in this respect in the last two years.
Have any third countries taken part in the “MEDIA Program” since it has been implemented? Should
the answer be in the affirmative, which were those countries?
A: Several third countries, candidate to the accession to the EU, participate in the MEDIA
programme: Bulgaria, Czech Republic, Estonia, Latvia and Poland participated in 2002 and Cyprus,Lithuania and Slovakia will join the programme in 2003.
What are the characteristics of the revision of “Television without Borders Directive” (or TWF
Broadcast Directive), due to take place in the first half of 2002?
A: The European Commission has adopted the fifth report on the application of article 4 and 5 of
89/552/EEC Directive (« Television without frontiers ») on 08.11.2002. This report, based oninformation provided by the Member States concerning the broadcasting of European works and
independent productions is forwarded to the Council and European Parliament, together with an
opinion on the general application of these articles.
Other sectors
Questions from Brazil:
What are the rules for the Economic Needs Tests in force in the EU?
A: The European Union has scheduled Economic Needs Tests relating to quantitative limitations
listed in subparagraphs (a) to (d) of Article XVI GATS in all modes of delivery. The criteria applieddiffer from sector to sector (see the EU’s Schedule of specific commitments). The European Union is
prepared to answer any specific question that might arise concerning its limitations in this respect.
What are the criteria and definitions used in the Ec onomic Needs Tests of the following aspects of the
following services, all of them present in  the EU’s schedules annexed to the GATS:
Medical services (CPC 9312) and services provided by nurses (CPC 93191)
A: The Economic Needs Test, when applied, sets a limit on the number of service suppliers authorised
to treat members of public insurance schemes mainly according to local demand and population
criteria.
Germany and Italy (only for CPC 93191) – What is the definition of “shortage”?A: Germany: An insufficiency in relation to local demand. Italy: No such language has been
scheduled.WT/TPR/M/102/Add.2
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Placement services (CPC 87202) – Germany – What is  the definition of “situation and development of
the labour market”?
A: The "situation and development of the labor market" primarily refers to unemployment rates and
business needs in specific professions .
Pharmaceutical wholesale trade services (CPC 622, part of the classification) – France – What is the
definition of “needs of the population”?
A: The number of service suppliers needed in relation to the population and the geographical density
of existing pharmacies.
Retailing services (CPC 631, 632, 633, 61112, 6113, 6121, except for 63211) – Belgium, Denmark,
France, Italy and Portugal – What are the criteria adopted?
What is the definition of “impact on existing stores” and “creation of new employments”?
A: The economic needs test, when applied, sets a limit on the number of department stores mainly
according to the number of and impact on existing stores, population density, geographic spread,
impact on traffic conditions and creation of new empl oyment. "Impact on existing stores" refers to the
need to take into account the interests of and im pact on existing businesses in the area in question.
"Creation of new employments" refers to the need to take into account the maintenance and expansion
of employment in the region as well as the quality of employment offered.
Hospital services (CPC 9311) – France, Italy, Luxemburg and Portugal – What is the definition of
“basis of needs”?
A: Local demand specified in health plans issued regularly.Hospital services (CPC 9311) – Netherlands – What is the definition of “health region”?
A: Regions for which health plans are drawn.Social services (CPC 933, W/120, 8.C) – France – What is the definition of “local needs”?
A: The number of service suppliers needed in relation to local demand.
Could the EU describe all the criteria adopted in the Economic Needs Test in the following cases?
- Distribution of pharmaceuticals to the public  (W/120 1.A.j) – Belgium, Denmark, Spain, France,
Ireland, Italy and Portugal;
A: The Economic Needs Test, when applied, sets a limit on the number of services suppliers mainly
according to the population and the geographical density of existing pharmacies.
- Higher education services (CPC 923) – Spain, France and Italy;A: The need to assure the existence, maintenance and quality of higher education.- Hotels and restaurant services (CPC 641, 642, 643) – Italy (additional clarification on linking the
tests solely to the protection of areas of historic value);
A: The measures aims at protecting areas of historic value and the ENT are two different limitations.WT/TPR/M/102/Add.2
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- Travel agency and tour operator services (CPC 7471) – Italy;
A: The protection of tourists and assurance of competition.
- Entertainment services (CPC 9619) – France and Italy (Although the EU’s schedule indicates ENT
for Italy, the EU databasis indicates France).
A: The economic needs test is applied in Italy: It requires an assessment of whether there are any
suitably qualified EEA service suppliers available to provide the service.
- Sporting services (CPC 9641) and recreation park and beach services (CPC 96491) – Italy;
A: The economic needs test, when applied, requires an assessment of whether there are any suitably
qualified EEA service suppliers available to provide the service.
- Passenger transportation (CPC 7122) – Spain;
A: The economic needs test, when applied, sets a limit in the number of services suppliers mainly
according to local demand.
- Passenger and freight bus transportation (CPC 71213) – Denmark, Spain, Ireland, Italy;A: The economic needs test, when applied, sets a limit in the number of service suppliers mainly
according to the existing public transport on the route concerned.
- Engineering (CPC 8672) and integrated engineering services (CPC 8673) – United Kingdom;
- Computer and related services (CPC 841-844) – Italy;
- Research and development services (CPC 851-853) – France;
- Advertisement services (CPC 871) – Italy and United Kingdom;- Management consulting services (CPC 865) – Italy and United Kingdom;
- Services related to management consulting (CPC 866) – Italy and United Kingdom;
- Technical testing and analysis services (CPC 8676) – United Kingdom;
- Translation and interpretation services (CPC 87905) – Italy and United Kingdom;
- Construction and related engineering services (CPC 511-518) – France;- Site investigation work (CPC 5111) – United Kingdom.
A: For all the above: The economic needs test, when applied, requires an assessment of whether there
are any suitably qualified EEA service suppliers available to provide the service.
What are the quantitative limits, coefficients and fo rmulae used in the ENT for the following services,
all of them present in the EU’s schedules annexed to the GATS?
Distribution of pharmaceuticals to the public (W /120 1.A.j) – France – What quotas are applied?
Wholesale pharmaceutical trade services (CPC 622 – part of the classification) – France – What
quotas are applied?
A: The Economic Needs Test, when applied, sets a limit on the number of services suppliers mainly
according to the population and the geographical density of existing pharmacies.
Retailing (CPC 631, 632, 633, 61112, 6113, 6121, except for 63211) – Belgium, Denmark, France,
Italy and Portugal – What ratios of population density and geographic dispersion are used as
parameters?WT/TPR/M/102/Add.2
Page 222
A: This varies among EU cities.
Hospital services (CPC 9311) – Belgium – What limits are there to the number of beds and of medical
equipment? What formulae are used to calculate the needs in function of population, age group,
mortality rate and geographic dispersion?
A: The number of beds and medical equipment needed are specified in health plans issued regularly.Hospital services (CPC 9311) – Italy – What is the ratio used (“ratio in function of the population”)?A: The relationship between the number of beds/equipment and the population.
Hospital services (CPC 9311) – Netherlands – What is the number of hospital beds in each health
region?
A: The number of beds and medical equipment needed are specified in health plans issued regularly.
Questions from India:
Article IV of GATS calls upon members to facilitate the increasing participation of developing
country members in trade in services through, inter alia, liberalization of market access in sectors
and modes of supply of export interest to them. In  view of sufficient skilled and highly competitive
manpower available in IT and software sectors, In dia has been demanding greater liberalization by
developed countries in services sectors under mode IV. However, EU member states generally issue
work permits after taking into account the employment situation in the respective member state.Countries like Spain, Germany, Neth erlands, Belgium and Denmark stipulate that work permits would
be issued to foreigners only if a suitable local employee is not possible to find within a reasonable
period. In Ireland, work permit is issued only after a certification by the local employer that no EEA
national with the required qualification is available to take up the job offer. Some EU countries like
Sweden and Belgium have rules that stipulate that the employer guarantees a certain minimum levelof remuneration. This stipulation appears to be against the principles of comparative advantage in
international trade. All such requirements virtually block the access of Indian service professionals
into the EU. India is concerned regarding such tr ade restrictive provisions. How does EU propose to
address this concern?
A: We draw India's attention to the footnote in the EC and its Member States GATS schedule, which
states "All other requirements of Community and Member States' laws and regulations regarding
entry, stay, work and social security measures shall continue to apply, including regulations
concerning period of stay, minimum wages as well as collective wage agreements". The issuance of
work and residence permits is a matter of member state competence. The issues raised in this questionare a matter to be discussed in the negotiations mandated under Article XIX GATS.
Indian software companies are experiencing a lot of delay in getting business visas or short time work
permit that in turn causes immense difficulty to them in meeting the contractual obligations.
Sometimes it takes more than two to three months for getting residence and work permits for inter
corporate transferees. Such long delay causes techni cal man power problems to Indian software firms
who have set up their own commercial presence in EU countries and thus affect software export from
India. Besides, documentation and administrative procedures needed to be transparent and
streamlined. Does EU propose to address these issues in near future?WT/TPR/M/102/Add.2
Page 223
A: Whilst bearing in mind the limitations of the GATS in this area as set out in the Annex on
Movement of Natural Persons, the EC and its Member States is open to discussing this issue in amultilateral context in the framework of the negotiations mandated under Article XIX GATS .
Specifically in the health services sector, there are major restrictions in EU countries in the form of
economic needs test. In United Kingdom for example, the number of beds and use of heavy medical
equipment is limited on the basis of a health plan. The needs test is in function of the degree ofspecialization, their capacity and equipment. The cr iteria are fixed, arithmetical rules or formulae
designed to calculate the needs in function of the population, age scale, death rate and geographical
spread. Does EU propose to remove such ENT or alternatively, does it propose to make the criteria of
ENT more specific?
A: Any modification to the schedule of the EU, as reported in the question from India, is a matter for
the present negotiations according to article XIX. The EU and its Member States will be open to
clarify the application of ENT in the area of health services where requested.
In Architecture / Urban Planning/ Landscape Architecture services, is Indian Architectural
Qualifications recognised at par with qualifica tions of EU member country for the purposes of
issuance of licence/ registration to practice the profession of and for pursuing higher education?
A: According to information made  available to the EU Commission, while some Indian schools are
validated in the United Kingdom in the framework of Commonwealth links, there are no similar
arrangements in other EU Member States.
For licensing or registration purposes, Indian architectural qualifications, including those validated inthe United Kingdom, will have to be assessed by the relevant licensing bodies and registration boards
in the different EU Member States (see answers to questions 686 to 690).
What are the criteria fixed for entering into mutual recognition agreement (MRAs) for recognizing
each other’s qualifications in the area of Architecture / Urban Planning/ Landscape Architectureservices?
A: Requests to enter into MRAs presented to the EU by other WTO members that have taken
substantial commitments in those sub-sectors will be addressed on a case by case basis, taking into
account the interests of EU industry and releva nt EC legislation (i.e. Directive 85/384/EEC).
Which body in the EU/member co untries examines qualifications various other non-EU member
countries in these sectors and grants equivalence to a national qualification vis-à-vis the foreign
qualification?
A: Bodies charged of taking individual decision s on equivalence of non-EU qualifications do only
exist at Member State level. According to inform ation made available to the EU Commission, these
bodies are normally linked to educational governmental authorities.
Is there any professional examination or any other examination prescribed as a condition precedent
to granting licence/ registration to pursue the profession of Architecture/ Urban Planning/ Landscape
Architecture? Is there any authority for accrediting the institutions also?*
A: According to information made available to the EU Commission, there is a professional
examination in Austria, Greece, and Portugal, and a State examination in Italy.
Accreditation of educational institutions and university schools is carried out by the educational
governmental authorities of the Member States.WT/TPR/M/102/Add.2
Page 224
What are the conditions for grant of registration/license to practice architecture service in EU
Member States?
A: See replies to above and below questions (marked with a *). There are also conditions of good
repute, good financial standing, absence of bankru ptcy and of criminal conviction and submission to
the professional and ethical rules of the State in whose territory the service is performed.
What are the nationality, residency, educational and experience criteria for grant of
licence/registration? *
A: Nationality and residency conditions for non EU nationals are listed in EC’s schedule of
commitments.As regards education, EC Directive 85/384/EEC en sures co-ordination of training in EU Member
States and establishes a minimum of 4 years full-time studies in architecture. The length of education
varies between Member States:
In Austria, 5 years in "Universitäten" or "Kunstakademie"
In Belgium, 5 yearsIn Germany, 5 years in "Technischen Hochschulen", "Universitäten" or "Kunsthochschulen", or 4
years in "Fachhochenschulen"
In Denmark, 5 to 6 years
In Spain, 5 to 6 years
In Finland, 4 or 5 years depending on title
In France, 5 years
In Greece, 5 yearsIn Ireland, 5 years
In Italy, 5 years
In Luxembourg, 4 years
In the Netherlands, 5 years at university or 6 years in Academies
In Portugal, 5 yearsIn Sweden, 4 or 5 years
In the United Kingdom, 5 years
In respect of practical experience, see reply to next question.
Is there any minimum period of internship to be undergone or experience to be acquired in a
professional’s office as a condition precedent to seeking licence / registration to pursue the
profession? *
A: According to information ma de available to the EU Commission, such requirement exists in
Germany (2 to 3 years), Austria (3 years), Belgium (2 to 3 years), France (6 months), Ireland and theUK (2 years), Luxembourg (1 year) and Sweden (4 months).
Is there any requirement that a licensed Architect has to be a member of a professional body/
Institution?
A: According to information ma de available to the EU Commission, inscription in a register is
compulsory in Austria, Belgium, Germany, Spain, France, Greece, Italy, Luxembourg, Portugal and
the United Kingdom.
In what mode and manner Architectural Professi on/ Urban Planning/ Landscape Architecture are
carried on by the licensed architects i.e. individually, in partnership or through private or public
limited companies?WT/TPR/M/102/Add.2
Page 225
A: As a general rule, architectural services have to be performed in conformity with the national legal
order of Member States. Limitations imposed by the national legal order of Member States that fallunder any of the categories indicated in Article XVI of GATS are listed in EC’s schedule of
commitments.
Are there any rules regarding the minimum quantum of professional indemnity insurance coverage
that a professional has to opt for?
A: According to information made available to the EU Commission, Austria, Belgium, France,
Luxembourg and the United Kingdom have a system of compulsory insurance coverage .
A major non-tariff barrier being faced by new sm all and medium scale enterprises (SMEs) from the
electronic sector who have not so far exported to or visited any EU country is in the form of not
getting business visa to visit EU countries. The EU country Missions in India insist on submission of a
letter of invitation from any EU buyer or any contact person, which new comers find extremely
difficult to arrange. As a result, they are, sometimes, unable to visit even any international specialized
trade fairs of their export interest. Such a visa co nstraint prevents Indian SMEs from the electronics
sector to participate in any product promotion or any buyer-seller meet or product display in EU
countries. This is, therefore, a major market access constraint, which SMEs from the IT products and
other electronic sector in India face in EU countries. Does EU propose to address this concern in
near future?
A: Third country nationals wishing to enter the territory of a Member State of the EU as business
travellers must be able to show (a) that they are planning on staying for less than 90 days, (b) they
intend to leave on completion of their visit and (c) they have sufficient means to support themselves
without working or recourse to public funds for the duration of the visit. With this in mind, it is
standard practice to require evidence of the business contacts to be undertaken. The type of
documentation which is considered acceptable varies between the Member States and can include a
letter of invitation from a potential client, from a Chamber of Commerce or other recognisedAssociation or an invitation to a conference/trade fair.
__________WT/TPR/M/102/Add.2
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ANNEX
2001/02 MARKETING YEAR
SET-aside % = 10%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF S UK EUR-15
COMMON
WHEATArea 188 647 2,895 155 1,320 4,496 84 630 129 276 47 144 402 1,663 13,074
Yield 7.68 7.40 7.90 2.41 2.41 6.81 9.09 4.54 8.43 5.30 0.79 3.62 5.95 7.19 6.45
Production 1,442 4,786 22,86
2374 3,181 30,63
3762 2,857 1,085 1,462 37 521 2,390 11,960 84,352
DURUM
WHEATArea 0 0 5 695 881 304 0 1,622 0 12 128 0 0 1 3,648
Yield 5.15 2.00 1.74 4.38 2.18 3.80 0.96 5.00 2.19
Production 24 1,390 1,536 1,332 3,531 46 123 5 7,986
BARLEY Area 65 737 2,117 100 2,993 1,703 182 341 65 217 15 547 395 1,257 10,734
Yield 6.55 5.24 6.40 1.95 2.09 5.78 6.93 3.48 6.54 4.66 0.87 3.32 4.05 5.48 4.50
Production 423 3,860 13,54
9195 6,246 9,842 1,259 1,187 425 1,012 13 1,814 1,600 6,890 48,317
MAIZE Area 43 0 397 195 504 1,917 0 1,098 27 171 159 0 0 0 4,511
Yield 10.16 8.75 8.50 9.84 8.59 9.45 8.81 8.71 5.74 8.87
Production 439 3,474 1,657 4,957 16,47
210,372 239 1,493 913 40,017
RYE Area 2 62 8 3 9 1 0 1 0 1 3 0 0 3 45 13 82 93 5 5 1,209
Yield 4.94 4.93 6.15 1.85 1.06 4.20 2.96 5.86 4.17 0.73 2.41 4.88 5.02 5.18
Production 10 306 5,158 19 107 126 10 23 214 28 70 171 23 6,263
OATS Area 9 55 232 47 441 117 18 143 3 31 77 423 271 112 1,979
Yield 4.51 5.11 4.90 1.66 1.49 4.14 7.31 2.26 5.81 4.08 0.58 3.05 3.55 5.49 3.13
Production 39 281 1,138 78 658 486 130 324 15 128 45 1,289 961 615 6,188
SORGHUM Area 0 0 0 1 86 6 0 33 0 0 1 0 0 0 109
Yield 1.92 5.65 5.94 5.93 1.15 5.84
Production 2 45 392 196 1 636
TRITICALE Area 9 41 537 0 32 236 0 1 5 31 19 0 40 14 964
Yield 5.86 4.63 6.41 2.38 4.83 4.00 6.22 5.03 0.67 4.71 4.61 5.56
Production 50 190 3,442 75 1,140 4 31 157 13 190 64 5,356
OTHERS
AND MIXEDArea 2 0 29 1 0 12 0 6 9 8 0 12 43 2 124
Yield 4.79 5.04 4.70 2.41 1.19 4.42 5.60 5.50 5.60 3.95 3.95 3.43 5.84 4.21
Production 8 0 137 2 0 53 0 33 50 33 45 149 12 522
TOTAL
CEREALESArea 316 1,542 7,051 1,204 6,280 8,881 283 3,878 241 799 484 1,154 1,186 3,054 36,353
Yield 7.62 6.11 7.06 3.09 2.68 6.81 7.59 4.77 7.74 5.69 2.42 3.24 4.60 6.41 5.49
GRAIN Production 2,411 9,424 #### 3,717 16,805 #### 2,151 18,514 1,869 4,545 1,172 3,740 5,460 19,569 199,637WT/TPR/M/102/Add.2
Page 227
2000/01 MARKETING YEAR
SET-aside % = 10%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF S UK EUR-15
COMMON
WHEATArea 224 627 2,960 160 1,502 4,929 84 666 137 278 59 149 401 2,085 14,261
Yield 7.80 7.49 7.29 2.55 3.61 7.27 8.37 4.73 8.36 4.56 1.80 3.61 5.98 8.01 6.71
Production 1,748 4,693 21,578 408 5,416 35,855 706 3,151 1,143 1,269 106 538 2,397 16,69
595,703
DURUM
WHEATArea 9 673 868 337 1,556 16 175 1 3,634
Yield 4.99 2.16 2.21 4.97 2.30 2.79 1.39 6.37 2.46
Production 43 1,450 1,917 1,674 3,578 44 243 6 8,955
BARLEY Area 59 741 2,068 97 3,307 1,573 181 344 47 224 23 559 409 1,128 10,758
Yield 6.58 5.37 5.85 2.67 3.41 6.31 6.25 3.67 6.10 3.82 1.44 3.55 4.00 5.76 4.80
Production 388 3,979 12,106 258 11,28
39,927 1,129 1,261 288 855 33 1,985 1,634 6,492 51,619
MAIZE Area 36 363 225 425 1,834 1,062 20 164 172 4,301
Yield 10.12 8.83 8.22 9.17 8.98 9.53 7.00 9.86 5.22 8.97
Production 364 3,203 1,850 3,896 16,473 10,123 142 1,617 898 38,566
RYE Area 2 5 1 8 4 31 2 1 1 1 3 5 3 65 24 54 53 5 7 1,246
Yield 4.80 5.14 4.93 1.88 1.90 4.56 2.88 4.87 3.48 1.04 2.43 5.40 6.29 4.35
Production 8 262 4,154 22 210 161 10 29 183 47 108 187 44 5,427
OATS Area 9 45 266 43 427 159 18 141 2 41 85 411 323 111 2,081
Yield 5.25 5.18 4.55 1.71 2.23 4.45 7.27 2.26 5.54 3.57 1.30 3.53 3.91 5.87 3.51
Production 47 233 1,211 73 952 708 128 318 13 147 111 1,452 1,261 652 7,306
SORGHUM Area 1 8 63 35 1 108
Yield 2.00 5.10 6.34 6.18 1.15 6.11
Production 24 1 4 0 0 2 1 4 1 658
TRITICALE Area 12 51 499 33 235 1 7 28 24 41 16 946
Yield 6.10 4.78 5.61 2.34 5.16 4.00 5.42 4.90 1.66 4.60 6.00 5.18
Production 75 244 2,800 76 1,213 4 36 135 40 187 96 4,904
OTHERS
AND MIXEDArea 2 0 29 1 0 61 0 6 7 8 12 43 2 171
Yield 5.00 5.20 4.29 2.00 1.19 3.85 5.60 3.03 5.60 3.61 3.52 3.30 6.50 3.82
Production 8 0 125 2 0 236 0 18 39 30 41 143 13 655
TOTAL
CEREALESArea 344 1,515 7,037 1,211 6,680 9,226 283 3,813 226 811 584 1,175 1,251 3,350 37,507
Yield 7.68 6.21 6.43 3.36 3.56 7.22 6.95 4.90 7.47 5.28 2.53 3.51 4.64 7.16 5.70
GRAIN Production 2,638 9,412 45,219 4,066 #### #### 1,963 18,678 1,690 4,280 1,478 4,124 5,810 #### 213,793WT/TPR/M/102/Add.2
Page 228
1999/00 MARKETING YEAR
SET-aside % = 10%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF S UK EUR-15
COMMON
WHEATArea 189 638 2,589 208 1,605 4,788 68 700 102 241 217 118 295 1,846 13,602
Yield 8.44 7.01 7.55 2.99 2.76 7.41 8.78 4.63 8.33 5.48 1.71 2.16 6.03 8.05 6.57
Production 1,594 4,471 19,55
0621 4,426 35,464 597 3,241 851 1,318 371 254 1,779 14,860 89,397
DURUM
WHEATArea 12 640 825 327 1,580 20 71 1 3,476
Yield 5.33 2.19 0.80 4.72 2.26 4.93 1.52 6.00 2.14
Production 64 1,400 658 1,545 3,571 99 108 6 7,449
BARLEY Area 65 728 2,210 119 3,107 1,534 192 354 58 244 33 581 496 1,178 10,898
Yield 6.95 5.05 6.02 2.69 2.39 6.22 6.65 3.76 6.29 4.73 1.30 2.70 3.85 5.58 4.49
Production 454 3,675 13,30
1320 7,434 9,548 1,275 1,330 365 1,153 43 1,568 1,909 6,578 48,952
MAIZE Area 34 371 210 398 1,763 952 16 153 191 4,086
Yield 12.00 8.79 8.57 9.48 8.87 9.75 7.00 9.60 5.33 8.99
Production 408 3,257 1,800 3,769 15,628 9,279 112 1,464 1,018 36,734
RYE Area 2 5 1 7 5 7 1 4 1 3 9 4 0 4 35 75 11 22 4 8 1,163
Yield 4.82 4.86 5.78 2.15 1.93 4.55 2.82 5.32 3.91 1.02 1.92 4.79 5.38 4.81
Production 10 248 4,375 31 269 184 8 14 225 52 24 113 43 5,594
OATS Area 10 26 268 50 410 122 20 141 2 36 72 404 317 92 1,968
Yield 5.50 5.00 5.00 2.30 1.30 4.51 6.75 2.34 5.56 4.29 1.04 2.45 3.46 5.86 3.07
Production 56 130 1,338 114 532 550 136 330 14 152 75 990 1,094 539 6,049
SORGHUM Area 0 9 53 33 0 96
Yield 2.00 5.00 6.24 6.43 1.15 6.17
Production 14 7 3 3 0 2 1 5 0 593
TRITICALE Area 8 54 386 25 234 12 2 24 33 34 13 825
Yield 6.62 4.65 6.14 1.02 5.07 3.75 5.99 5.09 1.21 4.73 6.31 5.27
Production 51 251 2,374 25 1,189 45 11 120 40 162 82 4,349
OTHERS
AND MIXEDArea 2 0 41 1 0 47 0 7 0 10 12 32 2 154
Yield 4.79 5.06 4.61 2.41 1.00 3.90 5.60 5.50 6.00 4.15 2.87 2.55 4.40 3.82
Production 9 0 190 2 0 183 0 39 0 41 34 81 9 589
TOTAL
CEREALESArea 310 1,497 6,635 1,242 6,517 8,908 280 3,783 183 783 668 1,127 1,197 3,140 36,269
Yield 8.33 5.86 6.70 3.45 2.63 7.25 7.18 4.77 7.46 5.84 2.56 2.55 4.29 7.04 5.51
GRAIN Production 2,581 8,775 #### 4,289 17,159 64,621 2,009 18,056 1,366 4,571 1,706 2,870 5,138 22,117 199,706WT/TPR/M/102/Add.2
Page 229
DIFFERENCE BETWEEN MARKETING YEAR 2000/01 AND 1999/00
SET-aside % = 10 and 10%
(Per cent)
B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR
-15
COMMON
WHEATArea 18.7 -1.7 14.3 -23.1 -6.4 2.9 23.8 -4.8 33.8 15.6 -72.8 26.8 35.9 12.9 4.8
Yield -7.6 6.8 -3.5 -14.6 30.8 -1.8 -4.6 2.2 0.4 -16.7 5.3 67.0 -0.8 -0.5 2.1
Production 9.6 5.0 10.4 -34.3 22.4 1.1 18.1 -2.7 34.2 -3.7 -71.4 111.8 34.8 12.3 7.1
DURUM
WHEATArea -28.2 5.2 5.2 3.0 -1.5 -21.5 148.0 0.0 4.5
Yield -6.4 -1.5 177.0 5.2 1.8 -43.4 -9.0 6.2 15.0
Production -32.8 3.6 191.4 8.3 0.2 -55.6 125.7 6.2 20.2
BARLEY Area -9.6 1.8 -6.4 -18.8 6.5 2.5 -5.8 -2.9 -18.6 -8.2 -30.3 -3.8 -17.6 -4.2 -1.3
Yield -5.3 6.4 -2.7 -0.7 42.6 1.4 -6.0 -2.3 -3.0 -19.2 10.1 31.7 3.8 3.1 6.8
Production -14.5 8.3 -9.0 -19.4 51.8 4.0 -11.5 -5.1 -21.0 -25.8 -23.2 26.6 -14.4 -1.3 5.4
MAIZE Area 5.9 -2.2 7.1 6.9 4.1 11.6 26.9 7.5 -9.9 5.3
Yield -15.7 0.5 -4.1 -3.3 1.3 -2.2 0.0 2.7 -2.0 -0.2
Production -10.7 -1.7 2.8 3.4 5.4 9.1 26.9 10.5 -11.8 5.0
RYE Area -10.6 0.0 11.3 -18.8 -20.5 -12.4 -20.9 129.0 -8.5 -11.8 261.8 47.0 -12.5 7.1
Yield -0.4 5.8 -14.7 -12.7 -1.6 0.1 2.1 -8.4 -11.0 2.0 26.7 12.8 16.9 -9.5
Production -11.0 5.8 -5.0 -29.1 -21.7 -12.3 25.1 109.7 -18.6 -10.0 358.4 65.8 2.3 -3.0
OATS Area -12.1 73.1 -0.6 -13.3 4.3 30.3 -12.9 -0.1 -2.1 16.5 18.1 1.8 1.9 20.7 5.7
Yield -4.5 3.6 -8.9 -25.7 71.8 -1.2 7.8 -3.4 -0.4 -16.9 24.8 44.0 13.1 0.2 14.3
Production -16.1 79.3 -9.5 -35.6 79.1 28.7 -6.1 -3.5 -2.5 -3.3 47.3 46.6 15.3 20.9 20.8
SORGHUM Area 150.0 -13.8 19.1 3.5 12.0
Yield 0.0 2.0 1.7 -4.0 0.0 -1.0
Production 150.0 -12.1 21.0 -0.6 10.9
TRITICALE Area 60.1 -5.6 29.2 31.7 0.3 -91.7 266.7 16.5 -27.3 19.0 23.1 14.7
Yield -7.9 2.9 -8.7 128.9 1.7 6.7 -9.6 -3.7 37.0 -2.7 -4.9 -1.7
Production 47.6 -2.8 17.9 201.5 2.0 -91.1 231.6 12.2 -0.4 15.7 17.1 12.8
OTHERS
AND MIXEDArea -15.1 -29.6 0.0 30.3 -14.3 -14.3 -3.4 35.6 0.0 11.3
Yield 4.3 2.8 -6.9 -17.0 19.0 -1.3 0.0 -44.9 -6.7 -13.0 22.8 29.5 47.7 0.0
Production -11.5 -34.5 -17.0 28.7 -52.8 -25.4 18.7 75.7 47.7 11.3
TOTAL
CEREALESArea 10.9 1.2 6.1 -2.5 2.5 3.6 0.9 0.8 23.6 3.6 -12.5 4.3 4.5 6.7 3.4
Yield -7.9 6.0 -4.1 -2.8 35.3 -0.4 -3.2 2.6 0.1 -9.6 -1.0 37.8 8.2 1.7 3.5
GRAIN Production 2.2 7.3 1.7 -5.2 38.7 3.1 -2.3 3.4 23.7 -6.4 -13.4 43.7 13.1 8.5 7.1WT/TPR/M/102/Add.2
Page 230
1998/99 MARKETING YEAR
SET-aside % = 5%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF S UK EUR-15
COMMON
WHEATArea 230 680 2,791 225 1,250 4,948 84 685 139 248 134 135 398 2,045 13,991
Yield 8.11 7.25 7.24 2.58 3.40 7.80 8.03 4.88 7.70 5.15 1.03 2.94 5.75 7.57 6.80
Production 1,868 4,930 20,20
7580 4,250 38,59
1673 3,343 1,073 1,276 138 397 2,289 15,47
295,085
DURUM
WHEATArea 12 615 625 295 1,557 17 26 1 3,148
Yield 5.13 2.11 2.06 5.20 2.30 3.96 1.00 6.00 2.50
Production 62 1,300 1,290 1,534 3,581 66 26 6 7,865
BARLEY Area 66 677 2,181 130 3,526 1,629 191 355 40 266 20 552 445 1,255 11,332
Yield 6.89 5.20 5.74 2.50 3.09 6.49 5.63 3.63 5.48 4.56 1.00 2.39 3.83 5.28 4.57
Production 454 3,520 12,51
3326 10,895 10,57
81,073 1,286 220 1,211 20 1,316 1,704 6,628 51,745
MAIZE Area 29 341 210 467 1,797 978 14 144 184 4,164
Yield 8.89 8.16 8.62 8.60 8.44 8.60 7.40 9.61 5.18 8.38
Production 255 2,783 1,810 4,014 15,16
48,413 101 1,386 953 34,879
RYE Area 2 103 936 16 120 46 9 6 60 50 31 35 10 1,425
Yield 5.60 5.13 5.10 2.22 1.73 4.73 2.70 4.81 3.99 0.64 1.37 4.74 5.26 4.47
Production 13 528 4,776 35 207 217 24 29 241 32 43 166 51 6,363
OATS Area 8 30 263 43 378 136 19 151 2 41 45 386 311 100 1,912
Yield 4.93 5.19 4.84 1.92 1.76 4.72 6.14 2.49 5.11 4.05 0.64 2.51 3.69 5.96 3.28
Production 39 156 1,274 83 663 642 119 375 10 164 29 969 1,146 598 6,267
SORGHUM Area 01 3 6 6 3 0 0 108
Yield 2.00 5.74 5.67 6.00 1.15 5.77
Production 07 4 3 7 2 1 7 7 0 623
TRITICALE Area 13 29 469 29 232 12 4 26 18 68 10 909
Yield 6.04 5.07 6.01 2.10 5.28 3.80 5.67 4.43 0.94 4.66 5.00 5.38
Production 79 147 2,816 61 1,223 46 24 114 17 314 50 4,891
OTHERS
AND MIXEDArea 1 4 39 3 20 55 7 0 13 9 12 27 0 189
Yield 4.95 5.38 4.47 2.16 2.00 4.32 5.45 0.00 5.60 4.07 2.33 2.97 5.00 3.90
Production 4 22 173 5 40 238 35 0 73 38 28 80 0 737
TOTAL
CEREALESArea 349 1,523 7,032 1,241 6,427 9,203 300 3,776 218 810 477 1,116 1,283 3,421 37,178
Yield 7.77 6.11 6.34 3.33 3.34 7.45 6.33 4.57 7.01 5.55 2.55 2.47 4.44 6.67 5.61
GRAIN Production 2,713 9,303 #### 4,139 21,494 #### 1,900 17,246 1,530 4,497 1,215 2,753 5,699 #### 208,454WT/TPR/M/102/Add.2
Page 231
1997/98 MARKETING YEAR
SET-aside % = 5%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF S UK EUR-15
COMMON
WHEATArea 219 703 2,711 240 1,402 4,846 97 714 137 245 230 124 344 2,036 14,048
Yield 7.35 7.20 7.30 2.74 2.41 6.82 7.24 4.24 7.73 5.26 1.14 3.86 6.09 7.38 6.23
Production 1,607 5,062 19,790 658 3,378 33,05
0702 3,027 1,059 1,289 262 479 2,095 15,026 87,484
DURUM
WHEATArea 7 606 642 266 1,557 12 30 1 3,121
Yield 5.42 2.32 1.73 3.46 1.90 4.00 0.76 6.00 2.09
Production 38 1,406 1,110 920 2,958 48 23 6 6,509
BARLEY Area 79 747 2,273 143 3,707 1,681 188 315 42 261 43 589 487 1,359 11,914
Yield 6.06 5.10 5.88 2.51 2.27 6.00 5.40 3.40 6.05 4.83 0.93 3.44 4.33 5.76 4.37
Production 476 3,806 13,356 359 8,396 10,08
61,015 1,071 254 1,261 40 2,026 2,109 7,828 52,083
MAIZE Area 25 368 220 502 1,815 1,034 18 161 160 4,303
Yield 8.20 8.60 9.00 8.60 9.09 9.40 8.30 9.50 4.50 8.90
Production 205 3,165 1,980 4,317 16,49
89,720 149 1,530 720 38,284
RYE Area 4 9 08 4 2 1 71 5 2 4 6 3 55 85 82 42 9 8 1,335
Yield 4.13 5.32 5.39 2.29 1.48 4.34 2.67 5.55 3.58 0.66 2.72 4.90 6.11 4.51
Production 15 477 4,534 39 225 200 8 28 208 38 65 142 49 6,027
OATS Area 12 30 309 43 383 133 20 134 2 46 78 349 309 100 1,948
Yield 4.58 4.90 5.04 2.26 1.27 4.22 6.47 2.02 5.17 4.25 0.55 3.37 4.10 5.78 3.38
Production 57 147 1,557 97 486 561 129 271 10 196 43 1,176 1,267 578 6,576
SORGHUM Area 11 0 6 9 3 5004 119
Yield 2.00 5.20 6.02 6.35 1.15 5.85
Production 25 2 4 1 5 2 2 2005 696
TRITICALE Area 14 13 438 0 34 211 0 11 3 22 42 0 65 9 862
Yield 5.22 5.38 6.03 1.77 4.80 0.00 4.00 5.33 5.50 0.84 0.00 5.00 6.00 5.17
Production 73 68 2,641 0 60 1,013 0 44 16 121 35 0 325 54 4,451
OTHERS
AND
MIXEDArea 1 3 50 3 13 66 4 7 15 0 17 30 2 211
Yield 4.90 4.90 4.76 2.50 1.90 4.00 5.50 5.50 3.80 3.30 4.00 5.50 4.07
Production 7 15 238 8 25 264 22 39 57 0 56 120 11 860
TOTAL
CEREALSArea 354 1,585 6,998 1,273 6,844 9,133 309 3,810 207 820 645 1,103 1,264 3,515 37,860
Yield 6.90 6.04 6.48 3.57 2.64 6.90 6.05 4.56 7.33 5.74 1.81 3.45 4.79 6.70 5.36
Production 2,440 9,574 45,320 4,548 18,050 #### 1,869 17,360 1,517 4,708 1,166 3,802 6,058 23,551 202,970WT/TPR/M/102/Add.2
Page 232
1996/97 MARKETING YEAR
SET-aside % = 10%
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
COMMON
WHEATArea 214 688 2,586 255 1,404 4,770 86 815 142 237 210 113 335 1,975 13,829
Yield 8.91 6.91 7.30 2.58 3.00 7.23 9.00 4.66 8.96 5.06 1.72 4.07 6.07 8.10 6.56
Production 1,907 4,756 18,881 658 4,212 34,487 771 3,798 1,269 1,198 362 459 2,030 15,99
890,786
DURUM
WHEATArea 8 600 655 270 1,523 11 27 1 3,095
Yield 5.83 1.97 2.60 4.64 2.22 3.85 1.63 6.00 2.47
Production 47 1,183 1,703 1,253 3,380 42 44 6 7,658
BARLEY Area 63 763 2,208 148 3,530 1,534 181 351 35 260 46 543 469 1,267 11,398
Yield 7.20 5.18 5.47 2.07 2.83 6.14 6.75 3.74 6.62 4.17 1.50 3.43 4.51 6.14 4.55
Production 454 3,953 12,073 306 9,990 9,419 1,225 1,312 235 1,083 69 1,860 2,113 7,780 51,872
MAIZE Area 23 372 185 435 1,734 992 11 179 185 4,116
Yield 8.00 7.83 8.89 8.50 8.30 9.23 8.02 8.62 4.62 8.38
Production 184 2,913 1,645 3,698 14,388 9,156 87 1,544 854 34,468
RYE Area 2 7 6 8 2 0 1 8 1 5 6 4 9 8 75 36 23 53 4 8 1,327
Yield 4.50 4.54 5.21 2.19 1.47 4.54 3.88 5.54 3.08 0.88 2.46 4.93 6.38 4.30
Production 11 343 4,272 39 229 221 31 38 162 54 87 166 51 5,705
OATS Area 8 26 302 40 411 140 21 142 2 42 71 374 278 96 1,952
Yield 4.90 5.09 5.32 2.00 1.40 4.16 6.99 2.50 5.62 3.67 0.85 3.37 4.32 6.00 3.47
Production 39 134 1,606 81 575 581 146 354 11 153 60 1,261 1,200 576 6,776
SORGHUM Area 10 55 50 114
Yield 4.98 6.26 6.00 6.04
Production 48 343 300 691
TRITICALE Area 1 2 6 3 6 4 0 3 2 2 0 3 0 0 31 84 0 06 2 7 747
Yield 6.90 5.20 5.84 0.00 2.85 4.87 0.00 0.00 5.99 4.35 1.38 0.00 5.07 5.86 5.12
Production 83 31 2,127 0 91 989 0 0 20 76 55 0 313 41 3,827
OTHERS
AND
MIXEDArea 2 6 46 55 12 10 40 3 173
Yield 5.20 5.14 4.78 4.16 3.80 3.20 4.10 5.38 4.30
Production 12 30 220 229 44 31 164 14 743
TOTAL
CEREALESArea 325 1,565 6,707 1,246 6,632 8,809 288 3,880 200 810 641 1,075 1,216 3,357 36,750
Yield 8.28 5.91 6.28 3.14 3.10 7.03 7.44 4.72 8.29 5.31 2.34 3.44 4.92 7.29 5.51
GRAIN Production 2,691 9,247 42,139 3,912 20,546 61,909 2,142 18,331 1,660 4,302 1,498 3,698 5,985 #### 202,525WT/TPR/M/102/Add.2
Page 233
2002/03 MARKETING YEAR
(1000 ha)
(1000 t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 9 90 1,290 22 1,063 2 23 1 54 1 60 45 430 3,090
 -of whichfood 7 75 942 20 768 2 20 1 50 1 59 43 310 2,297
 - n o n  f o o d 2 1 5 3 4 8 2 2 9 51304012 1 2 0 792
YIELDS 3.40 2.75 3.50 1.20 3.35 3.30 1.75 3.30 2.75 1.20 1.60 2.35 3.25 3.21
non-foods 3.40 2.75 3.10 1.10 2.95 3.30 1.75 3.30 2.75 1.20 1.60 2.35 3.25 3.04
PRODUCTION 31 248 4,375 27 3,444 7 40 2 149 1 96 106 1,398 9,921
 - FOOD 24 206 3,297 24 2,574 5 35 2 138 1 94 101 1,008 7,508
-  N O N - F O O D 7 4 1 1 , 0 7 803 8 7 0250 1 1025 3 9 0 2,412
SUNFLOWER Total AREA 28 26 900 660 167 17 41 1 1,840
-of whichfood 25 26 895 610 152 17 41 1 1,767
 -non food 3 0 5 50 15 0 0 73
YIELDS 2.40 1.53 0.93 2.35 2.29 2.30 0.79 2.00 1.60
non-foods 2.40 1.53 0.83 2.35 2.29 2.18
PRODUCTION 66 40 837 1,551 379 39 32 1 2,945
 - FOOD 60 40 832 1,434 348 39 32 1 2,786
- NON-FOOD 6 0 4 118 31 0 0 159
SOYA Total AREA 0 0 1 90 150 10 251
of which non food 0 0 0 0 0 0
YIELDS 3.00 2.50 1.80 2.83 3.66 2.80 3.32
PRODUCTION 1 0 2 255 549 28 834
 - FOOD 1 0 2 255 549 28 834
- NON-FOOD 0 0 0 0 0 0 0
TOTAL Total AREA 9 90 1,318 26 923 1,813 2 340 1 81 42 60 45 431 5,180
of which- food 7 75 967 26 916 1,468 2 322 1 77 42 59 43 311 4,315
OILSEED -  n o n  f o o d 2 1 5 3 5 107 3 4 51 1 804012 1 2 0 865
YIELDS 3.40 2.75 3.37 1.53 0.94 2.90 3.30 2.85 3.30 2.66 0.80 1.60 2.35 3.25 2.64
PRODUCTION 31 248 4,441 40 865 5,249 7 969 2 216 34 96 106 1,399 13,700
 - FOOD 24 206 3,357 40 858 4,262 5 932 2 205 34 94 101 1,009 11,129
- NON-FOOD 7 41 1,084 0 7 987 2 37 0 11 0 2 5 390 2,571
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-
15
PROTEINS(1)Total AREA 3 70 178 15 80 450 2 43 2 48 8 2 33 227 1,161
P E A S 27 0 1 2 0 15 0 3 8 5 1 3 04 5 0 23 0 1 0 1 810
BEANS+s.lupins 1 0 58 14 30 65 1 40 2 3 8 0 3 126 351
YIELDPEAS 4.30 4.20 3.30 1.60 1.00 4.90 4.50 2.80 4.50 3.40 0.80 2.60 2.40 3.90 4.04
BEANS 3.80 3.90 3.50 2.00 0.96 3.49 5.00 1.46 3.00 3.00 0.80 2.40 3.60 2.95
PRODUCTION 12 294 599 29 79 2,113 10 67 8 162 6 5 79 848 4,310
PEAS 9 294 396 1 50 1,887 5 8 2 153 0 5 72 394 3,275
BEANS 4 0 203 28 29 226 5 58 6 9 6 0 7 454 1,035
 (1000ha)
(1000t)B/LU
XDK D EL ES F IR IT NL OS P SF SV UK EUR-15
LINSEED area 16 34 13 12 4 1 17 72 169
yield 1.29 1.55 1.27 2.00 1.00 1.14 1.00 0.90 1.19
production 20 53 16 24 4 2 17 65 200WT/TPR/M/102/Add.2
Page 234
2001/02 MARKETING YEAR
Blair House: 548200 ha
10% = 4,933,800 ha
(1000 ha)
(1000 t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 8 81 1,140 25 1,096 2 30 1 56 1 73 44 451 3,007
 -of whichfood 5 60 812 22 792 2 30 1 43 1 72 22 408 2,270
 -non food 3 21 328 2 304 0 0 0 13 0 1 22 43 737
YIELDS 3.40 2.73 3.77 1.42 2.64 3.50 1.05 3.25 2.61 1.20 0.99 2.38 2.57 2.95
non-foods 3.40 2.73 3.37 1.32 2.63 3.50 1.05 3.25 2.61 1.20 0.99 2.38 2.57 2.95
PRODUCTION 26 220 4,165 35 2,891 7 32 2 146 1 72 105 1,159 8,862
 - FOOD 17 163 3,060 32 2,091 6 32 2 112 1 71 52 1,049 6,688
- NON-FOOD 9 57 1,105 0 3 800 1 0 0 34 0 1 52 111 2,173
SUNFLOWER Total AREA 25 17 858 709 210 20 49 1,888
 -of whichfood 21 17 811 649 188 18 41 1,745
 -non food 4 0 47 60 22 2 8 143
YIELDS 2.50 1.10 1.02 2.23 1.97 2.50 0.59 1.60
non-foods 2.50 1.10 0.92 2.20 1.97 2.50 0.59 1.62
PRODUCTION 60 19 869 1,579 409 50 29 3,015
 - FOOD 52 19 826 1,447 370 45 24 2,783
- NON-FOOD 9 0 43 132 39 5 5 232
SOYA Total AREA 022 1 1 9 2 3 9 1 6 379
of which non food 0 0 0 0 0 0
YIELDS 3.00 2.50 2.10 2.45 3.71 2.10 3.23
PRODUCTION 155 2 9 2 8 8 5 3 4 1,221
 - FOOD 1 5 5 292 885 34 1,221
- NON-FOOD 0 0 0 0 0 0 0
TOTAL Total AREA 8 81 1,165 19 885 1,924 2 479 1 92 50 73 44 451 5,273
of which- food 5 60 19 836 1,560 2 457 1 77 42 72 22 408 3,560
OILSEED - non food 3 21 332 0 49 364 0 22 0 15 8 1 22 43 880
YIELDS 3.40 2.73 3.63 1.25 1.03 2.47 3.50 2.77 3.25 2.50 0.60 0.99 2.38 2.57 2.48
PRODUCTION 26 220 4,226 24 908 4,762 7 1,327 2 230 30 72 105 1,159 13,098
 - FOOD 17 163 3,113 24 862 3,830 6 1,287 2 191 25 71 52 1,049 10,693
- NON-FOOD 9 57 1,114 0 46 932 1 39 0 39 5 1 52 111 2,406WT/TPR/M/102/Add.2
Page 235
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
PROTEINS(1) Total AREA 2 33 185 13 63 479 2 64 3 41 12 5 29 275 1,206
P E A S 23 3 1 6 4 14 9 4 1 9 1 6 13 9 0 52 6 1 0 2 848
BEANS+s.lupins 0 0 20 12 14 60 1 58 2 3 12 0 3 173 359
YIELDPEAS 4.38 3.64 3.39 1.60 1.00 3.86 4.50 3.70 4.50 2.92 0.80 2.13 2.85 3.07 3.42
BEANS 4.00 3.60 3.80 2.50 1.00 3.44 5.00 2.03 4.00 2.66 0.52 2.85 2.78 2.69
PRODUCTION 9 120 634 31 63 1,824 10 139 14 120 6 12 83 795 3,859
PEAS 7 120 557 1 49 1,617 5 21 6 113 0 12 74 314 2,895
B E A N S 20 7 7 3 0 1 4 2 0 65 1 1 887609 4 8 1 9 6 4
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
LINSEED  AREA 18 0 34 0 3 12 0 5 0 0 2 4 31 108
YIELD 0.68 1.50 1.55 0.00 0.60 1.98 1.10 0.89 0.00 0.60 0.72 0.77 1.23 1.26
PRODUCTION 12 0 52 0 2 23 0 4 0 0 1 3 38 136WT/TPR/M/102/Add.2
Page 236
200/01 MARKETING YEAR
Blair House: 5482000 ha
10% = 4,933,800 ha
(1000 ha)
(1000 t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 8 102 1,078 32 1,225 3 36 1 52 1 53 49 402 3,040
 -of which   food 6 87 765 30 920 2 36 1 48 1 52 47 290 2,283
 - n o n  f o o d 2 1 5 3 1 3 2 3 0 51004012 1 1 2 757
YIELDS 2.80 2.91 3.44 1.57 3.01 3.30 1.13 3.40 2.40 1.20 1.35 2.50 2.81 2.97
non-foods 2.80 2.91 3.04 1.47 2.61 3.30 1.13 3.40 2.40 1.20 1.35 2.50 2.81 2.82
PRODUCTION 22 297 3,586 50 3,569 8 41 3 125 1 71 121 1,129 9,023
 - FOOD 17 253 2,634 46 2,772 7 41 3 115 1 70 116 814 6,889
-  N O N - F O O D 6 4 4 9 5 203 7 9 7200 1 0015 3 1 4 2,134
SUNFLOWER Total AREA 26 20 841 710 218 22 46 2 1,885
 -of which food 25 20 839 675 208 22 46 2 1,837
 -non food 1 0 2 35 10 0 0 0 48
YIELDS 2.48 1.20 1.01 2.57 2.10 2.50 0.65 0.50 1.75
non-foods 2.48 1.20 0.91 2.57 2.10 2.13
PRODUCTION 64 24 849 1,813 456 55 30 1 3,292
 - FOOD 62 24 847 1,733 437 55 30 1 3,189
- NON-FOOD 2 0 2 79 19 0 0 0 102
SOYA Total AREA 0 0 3 80 253 16 351
of which non food 0 0 0 0 0 0
YIELDS 3.00 2.50 2.17 2.69 3.57 2.10 3.29
PRODUCTION 1 0 6 215 903 33 1,157
 - FOOD 1 0 6 215 903 33 1,157
-  N O N - F O O D 0000 0 0 0
TOTAL Total AREA 8 102 1,104 20 875 2,015 3 507 1 90 47 53 49 404 5,277
of which- food 6 87 790 20 871 1,675 2 497 1 86 47 52 47 292 4,472
O I L S E E D -  n o n  f o o d 2 1 5 3 1 404 3 4 01 1 004012 1 1 2 8 0 5
YIELDS 2.80 2.91 3.31 1.20 1.03 2.78 3.30 2.76 3.40 2.37 0.66 1.35 2.50 2.80 2.55
PRODUCTION 22 297 3,651 24 905 5,597 8 1,400 3 212 31 71 121 1,130 13,472
 - FOOD 17 253 2,696 24 899 4,721 7 1,381 3 203 31 70 116 815 11,236
-  N O N - F O O D 6 4 4 9 5 405 8 7 62 1 90 1 0015 3 1 42 , 2 3 6
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
PROTEINS(1) Total AREA 2 60 159 15 73 446 1 61 3 44 12 5 25 191 1,098
PEAS 1 60 141 0 43 424 1 2 1 41 0 5 25 67 812
BEANS+s.lupins 1 0 18 15 31 22 59 2 3 12 0 0 124 286
YIELDPEAS 4.14 4.20 2.90 1.60 1.35 4.52 4.50 3.15 4.70 2.34 0.80 2.30 2.62 3.70 3.79
BEANS 3.50 3.90 3.40 2.00 1.15 3.60 5.00 1.56 4.00 2.10 0.50 3.55 2.65
PRODUCTION 8 252 470 30 93 1,997 5 100 11 102 6 12 67 688 3,839
PEAS 6 252 409 0 57 1,918 5 8 4 96 0 12 67 248 3,080
B E A N S 2 06 13 03 67 9 09 2 7 6 6 0 0 4 4 0 760
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
LINSEED AREA 14 0 102 0 5 16 0 4 0 0 1 10 74 227
YIELD 1.02 1.50 1.55 0.00 0.60 1.92 1.10 0.91 0.00 0.60 1.00 0.78 0.61 1.17
PRODUCTION 1 40 1 5 9 03 3 00 4 0018 4 5 264WT/TPR/M/102/Add.2
Page 237
1999/00 MARKETING YEAR
Blair House: 5482000 ha
10% = 4,933,800 ha
(1000 ha)
(1000 t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 11 143 1,198 50 1,369 3 51 1 65 0 63 83 543 3,580
 -of whichfood 7 116 831 48 1,009 2 46 1 61 0 63 79 422 2,685
 - n o n  f o o d 4 2 7 3 6 7 2 3 6 00504014 1 2 1 895
YIELDS 3.31 2.71 3.76 1.33 3.40 1.93 1.01 3.39 2.95 1.20 1.41 2.14 3.98 3.32
non-foods 3.31 2.71 3.16 1.23 2.90 3.30 0.76 3.39 2.95 1.20 1.41 2.14 3.50 3.06
PRODUCTION 36 388 4,284 67 4,475 6 50 4 192 0 89 177 2,102 11,870
 - FOOD 23 314 3,125 64 3,431 4 46 4 180 0 88 169 1,679 9,128
-  N O N - F O O D 1 3 7 3 1 , 1 6 0 3 1 , 0 4 4140 1 2019 4 2 3 2,742
SUNFLOWER Total AREA 33 40 850 799 209 24 55 0 0 2,011
-of which food 31 40 845 764 194 24 55 0 0 1,954
 -non food 2 0 5 35 15 0 0 0 57
YIELDS 2.51 1.30 0.68 2.34 2.06 2.64 0.55 0.50 1.50 1.54
non-foods 2.51 1.30 0.58 2.34 2.06 2.05
PRODUCTION 82 52 579 1,871 428 64 30 0.1 0 3,106
 - FOOD 78 52 576 1,789 400 64 30 0 0 2,989
- NON-FOOD 4 0 3 82 28 0 0 0 117
SOYA Total AREA 0 0 4 102 252 19 0 378
of which non food 0 0 0 0 0 0 0
YIELDS 2.30 2.50 2.19 2.66 3.55 2.72 2.00 3.25
PRODUCTION 1 0 9 272 895 50 1 1,228
 - FOOD 1 0 9 272 895 50 1 1,228
- NON-FOOD 0 0 0 0 0 0 0 0
TOTAL Total AREA 11 143 1,231 40 905 2,270 3 512 1 108 55 63 83 543 5,968
of which- food 7 116 862 40 897 1,875 2 492 1 104 55 63 79 423 5,016
OILSEED -  n o n  f o o d 4 2 7 3 6 907 3 9 50 2 004014 1 2 1 952
YIELDS 3.31 2.71 3.55 1.30 0.72 2.91 2.13 2.68 3.39 2.84 0.55 1.41 2.14 3.87 2.72
PRODUCTION 36 388 4,367 52 655 6,617 6 1,373 4 307 30 89 177 2,103 16,204
 - FOOD 23 314 3,203 52 649 5,491 4 1,341 4 295 30 88 169 1,680 13,345
- NON-FOOD 13 73 1,164 0 6 1,126 1 32 0 12 0 1 9 423 2,859WT/TPR/M/102/Add.2
Page 238
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
PROTEINS(1) Total AREA 3 66 212 3 82 499 3 53 4 49 4 6 35 203 1,220
P E A S 26 6 1 6 4 05 0 4 7 6 2 6 14 6 0 53 19 0 938
BEANS+s.lupins 1 0 48 3 32 23 1 47 3 3 4 1 1 113 279
YIELDPEAS 5.20 2.92 3.71 2.11 0.96 5.49 4.50 3.60 4.67 3.03 0.70 1.50 2.81 3.94 4.36
BEANS 4.19 2.92 4.13 2.19 0.97 3.80 5.00 1.76 3.74 2.66 0.57 0.50 3.51 2.98
PRODUCTION 17 193 806 6 79 2,699 13 104 14 146 2 8 87 752 4,926
PEAS 12 193 608 0 48 2,612 7 22 4 140 0 7 87 355 4,094
BEANS etc 5 0 198 5 31 87 6 83 10 7 2 1 0 397 832
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
Non-Textile  AREA 01 11 9 1 02 71 8 30 4 71 8 33 3 2 1 7 531
LINSEED YIELD 1.50 1.30 1.50 0.00 0.60 2.07 1.10 0.70 1.14 1.20 0.60 0.48 0.95 1.43 1.35
PRODUCTION 01 52 8 7 01 63 6 30 81 1 13 1 3 0 9 719WT/TPR/M/102/Add.2
Page 239
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 10 118 1,009 46 1,145 7 76 1 55 1 65 55 531 3,119
 -of whichfood 8 107 864 44 1,000 6 76 1 52 1 65 52 504 2,780
 -non food 2 11 145 2 145 1 0 0 3 0 0 3 27 339
YIELDS 2.95 3.07 3.36 1.58 3.26 2.95 2.00 3.12 2.47 1.20 1.30 2.29 2.97 3.10
PRODUCTION 29 362 3,394 71 3,735 20 153 3 135 1 49 125 1,575 9,652
 - FOOD 23 328 2,906 70 3,262 19 152 3 128 1 84 118 1,495 8,590
- NON-FOOD 5 34 488 2 473 1 1 0 7 0 0 7 80 1,097
SUNFLOWER Total AREA 34 33 1,031 782 339 22 84 0 2,324
-of which food 31 33 1,031 742 325 21 84 0 2,266
 -non food 3 0 0 40 14 1 0 0 58
YIELDS 2.53 1.35 1.06 2.18 2.02 2.57 0.37 2.00 1.59
PRODUCTION 85 44 1,096 1,704 682 57 31 0 3,699
 - FOOD 78 44 1,096 1,617 657 54 31 0 3,577
- NON-FOOD 7 0 0 87 25 3 0 0 122
SOYA Total AREA 006 1 1 2 3 7 9 2 0 0 517
of which non food 0 0 0 0 0 0
YIELDS 2.19 2.00 2.25 2.53 3.70 2.52 1.50 3.38
PRODUCTION 0 0 12 283 1,402 50 0 1,748
 - FOOD 0 0 12 283 1,402 50 0 1,748
- NON-FOOD 0 0 0 0 0 0 0 0
TOTAL Total AREA 10 118 1,043 33 1,082 2,039 7 794 1 97 85 65 55 531 5,960
of which- food 8 107 895 33 1,080 1,854 6 780 1 93 85 65 52 504 5,563
OILSEED - non food 2 11 148 0 2 185 1 14 0 4 0 0 3 27 397
YIELDS 2.95 3.07 3.33 1.35 1.09 2.81 2.95 2.82 3.12 2.50 0.38 1.30 2.29 2.96 2.54
PRODUCTION 29 362 3,479 44 1,180 5,722 20 2,237 3 242 32 84 125 1,576 15,135
 - FOOD 23 328 2,984 44 1,179 5,161 19 2,211 3 233 32 84 118 1,496 13,916
- NON-FOOD 5 34 495 0 2 560 1 26 0 9 0 0 7 80 1,219
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-
15
PROTEINS(1) Total AREA 3 106 230 3 101 624 4 63 3 61 24 5 49 213 1,489
PEAS 3 106 169 0 56 604 1 3 1 59 0 5 49 102 1,157
BEANS+s.lupins 0 0 62 3 45 20 4 60 3 2 24 0 0 111 332
YIELDPEAS 4.42 3.72 3.49 2.50 1.30 5.33 4.00 3.00 4.43 3.04 0.60 1.00 2.50 3.80 4.32
BEANS 4.24 3.00 3.54 2.13 1.00 3.62 4.99 1.67 3.66 2.59 0.63 3.60 2.67
PRODUCTION 11 394 807 6 118 3,293 21 110 13 184 15 5 123 787 5,885
PEAS 11 394 589 0 73 3,221 3 10 3 178 0 5 123 388 4,998
B E A N S 0 0 2 1 8 64 57 21 8 1 0 0 1 0 51 5 0 0 3 9 9 887
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-
15
LINSEED AREA 06 1 0 90 3 175004 2 52 1 6 1 0 2 308
YIELD 0.00 1.40 1.50 0.00 0.60 1.95 1.10 1.00 0.92 1.00 0.40 1.00 1.00 1.32 1.22
PRODUCTION 08 1 6 30 1 9 1 46004 1 02 1 6 1 3 5 377WT/TPR/M/102/Add.2
Page 240
1997/98 MARKETING YEAR
Blair House: 5482000 ha
10% = 4,933,800 ha
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
RAPESEED Total AREA 7 106 915 0 84 963 6 101 1 57 1 60 62 476 2,839
 -of whichfood 6 96 809 82 813 5 98 1 52 1 60 60 446 2,528
 - n o n  f o o d 2 1 0 1 0 6 2 1 5 0130500 2 3 0 311
YIELDS 3.12 2.80 3.10 1.60 3.50 3.00 1.80 3.67 2.36 1.20 1.50 2.05 3.15 3.05
PRODUCTION 22.8 293 2,799 135 3,371 17 181 3 133 1 90 127 1,484 8,655
 - FOOD 18.4 269 2,507 131 2,846 15 176 3 123 1 90 123 1,405 7,707
-  N O N - F O O D4 . 4 2 4 2 9 2 3 5 2 5240 1 000 4 8 0 949
SUNFLOWER Total AREA 34 26 1,055 887 305 21 100 2,428
 -of which food 31 26 1,041 847 280 21 100 2,346
 -non food 3 0 14 40 25 0 0 82
YIELDS 2.43 2.00 1.25 2.40 1.82 2.00 0.79 1.75
PRODUCTION 81 51 1,317 2,121 550 42 79 4,242
 - FOOD 75 51 1,301 2,033 510 42 79 4,091
- NON-FOOD 6 0 16 88 41 0 0 150
SOYA Total AREA 0 0 5 96 347 17 466
of which non food 0 0 0 0 0 0
YIELDS 3.00 2.50 2.30 2.90 3.70 2.12 3.46
PRODUCTION 1 0 12 280 1,284 36 1,612
 - FOOD 1 0 12 280 1,284 36 1,612
- NON-FOOD 0 0 0 0 0 0 0
TOTAL Total AREA 7 106 949 26 1,144 1,946 6 753 1 95 101 60 62 476 5,733
of which- food 6 96 840 26 1,128 1,756 5 725 1 90 101 60 60 446 5,340
OILSEED -  n o n  f o o d 2 1 0 1 0 90 1 6 1 9 01 2 80500 2 3 0 393
YIELDS 3.08 2.76 3.04 2.00 1.28 2.96 2.96 2.68 3.67 2.22 0.79 1.50 2.04 3.12 2.53
PRODUCTION 23 293 2,881 51 1,463 5,771 17 2,015 3 211 80 90 127 1,484 14,509
 - FOOD 18 269 2,583 51 1,444 5,158 15 1,970 3 201 80 90 123 1,405 13,410
-  N O N - F O O D 42 4 2 9 8 01 9 6 1 3 24 5 01 0 0 048 0 1,099WT/TPR/M/102/Add.2
Page 241
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
PROTEINS(1) Total AREA 3 94 193 2 82 636 3 65 2 54 4 6 34 191 1,369
PEAS 3 94 110 0 71 620 1 14 2 47 0 6 34 93 1,095
BEANS+s.lupins 0 0 83 2 11 16 2 51 0 7 4 0 0 98 274
YIELDPEAS 4.50 3.60 3.40 1.60 1.00 4.95 4.00 2.00 4.00 3.00 0.80 2.00 2.20 3.70 4.09
BEANS 4.00 3.50 3.50 2.00 1.00 3.50 5.00 1.50 3.00 3.00 0.80 3.40 2.94
PRODUCTION 14 338 665 4 82 3,125 13 105 8 162 3 12 75 677 5,283
PEAS 14 338 374 0 71 3,069 4 28 8 141 0 12 75 344 4,478
B E A N S 10 2 9 14 1 1 5 69 7 70 2 130 0 3 3 3 805
(1000ha)
(1000t)B/LUX DK D EL ES F IR IT NL OS P SF SV UK EUR-15
LINSEED  AREA 0 4 9 4 0 2 052 342 1 0 7 5 219
YIELD 0.00 1.40 1.38 0.00 0.55 1.48 1.10 0.00 0.60 1.00 1.00 1.40 1.26
PRODUCTION 0 6 1 3 0 0 1 172 022 1 01 0 5 275
__________