RESTRICTEDWORLD TRADE
ORGANIZATIONG/C/W/321
19 October 2001
(01-5154)
Council for Trade in Goods Original:  Spanish
QUESTIONS FROM HONDURAS REGARDING THE REQUESTS
FOR A WTO WAIVER CONCERNING THE NEW ACP-EC
PARTNERSHIP AGREEMENT
The following communication, dated 18 October 2001, has been received from the Permanent
Mission of Honduras.
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In accordance with the indicative timetable of  the Working Party to Examine the Request for
a WTO Waiver concerning the new ACP-EC Part nership Agreement, Honduras hereby submits its
preliminary questions on the Agreement for circulation to Members.
Honduras requests the EC to respond in writing to  the questions posed, and reserves the right
to submit further questions to the EC at a later date.
Questions of the Delegation of Honduras for the Examination of
the Waiver Concerning the EC-ACP Partnership Agreement
1. In Article 23(g) of the Partnership Agreement between the African, Caribbean and Pacific
States and the European Community and its Member States, the concept of "the promotion of fair
trade" is introduced.  Could the European Commun ity explain what it means by this concept and how
it would be applied in practice, within the framework of the WTO Agreements, as well as in its
relations with other developing countries, particularly bearing in mind that some of the provisions of
the Agreement are discriminatory and restrict other countries' access to the Community market?
2. With regard to Article 29 of the Agreement, could the European Community and its member
States explain how they intend this cooperation to work, in the context of Article V of the GATS?How do they intend to implement Article 29(d) of the Agreement?  What time-frame and specific
steps are planned in order to achieve the objectives of Article 29?
3. Article 36 of the Agreement provides for the removal of barriers to trade, the introduction of
new trading arrangements and the establishment of a preparatory period.  Could the European
Community and its member States explain how they intend to achieve the removal of barriers totrade?  What "new trading arrangements" are referred to in paragraph 2 of this Article and what form
will they take in the light of the relevant provisions of the WTO Agreements?  Will these "new
trading arrangements" be bilateral arrangements between the European Union and certain ACP
countries or will they take place between the EU and the ACP countries as a whole?
4. In Article 37, paragraph 5, reference is made to "economic partnership agreements".  Could
the EU explain the difference between these agreements and the trading arrangements provided for in
Article 36?  Article 37, paragraph 6, provides for the Community to examine all alternative
possibilities, in order to provide the least-developed countries (LDC) which are not in a position to
enter into the economic partnership agreements with a "new framework for trade which is equivalentG/C/W/321
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to their existing situation and in conformity with WT O rules".  Does this mean that a new waiver will
be requested in order to guarantee the existing situation, and what is meant by "existing situation":  is
it the date on which the examination of the situation was carried out, is it the year 2004 when the
period of the waiver will still be in force, or is it a different period altogether?  Could the EU explain
how it intends to comply with the WTO rules an d continue to guarantee an equivalent trade
framework, without requesting another waiver?
5. Article 37, paragraph 7, provides for the establishment of a timetable for the progressive
removal of barriers to trade between the parties, in accordance with the relevant WTO rules.  What
does the EU mean by trade liberalization built on the "acquis"?  In the same paragraph, reference is
made to a "transitional period".  Could the EU ex plain to what period it is referring, how long this
would last and how it differs from the preparatory period mentioned earlier?  Does it intend to extend
this transitional period beyond the year 2008 and, if so, does this mean it will request a furtherwaiver?
6. In Article 37, paragraph 8, why does the EU consider that it needs to defend the arrangements
reached in the WTO?  What trade arrangements are being referred to in this paragraph:  the current
situation covered by the waiver request or some future trade arrangements which will be subject to a
further waiver request?  Why is it so important to defend the degree of flexibility available, and couldthe EU explain what it means by that, as well as what forms of flexibility it intends to provide for the
LDCs being referred to in this paragraph?
7. With reference to Article 41, paragraph 3, could the EU explain how it intends to give
sympathetic consideration to the ACP States' priorities for improvement in the EC schedule, and does
this mean that commitments will be scheduled outside the framework of the most-favoured-nationregime?  In Article 41, paragraph 4, reference is made to a partnership for the liberalization of
services.  Could the EU explain what this refers to, and how this liberalization would work, in the
context of Article 5 of the GATS?  What time-period does it intend to establish in order to achieve
this mutual liberalization? Article 41, paragraph 5, provides for support for the capacity to supply
services.  How does this tie in with the aims of greater commitments from the EU and mutualliberalization?
8. Article 42 provides for the promotion of the liberalization of maritime transport, and to this
end for the application of the principle of unrestricted access on a non-discriminatory basis, but
reference is only made to equal treatment for ship s operated by nationals or companies of the other
party, and for ships registered in the territory of either party.  How can this be explained in the context
of MFN treatment, and does this mean that various regimes will be established to apply to maritime
transport?  How will these measures be justified under the relevant provisions of the GATS?  Whendoes the EU intend the different treatment to come into  force with respect to access to ports, the use of
infrastructure and maritime services, related fees and charges, customs facilities and the assignment of
berths and facilities for loading and unloading?  Wh at treatment will be received by ships operated by
nationals of other WTO Members and/or ships not registered in the territory of the EU or of an ACP
country?
9. In Article 45, paragraph 2, reference is made to the implementation of national or regional
rules and policies including the control and under certain conditions the prohibition of agreements
between undertakings, decisions by associations of undertakings and concerted practices.  How will
this be applied at the regional level, and what is meant by regional rules?  Is the EU-ACP area or
merely the ACP area being referred to?  Could th e association of ACP undertakings and undertakings
from other WTO Members be prohibited?  How would a regional regime be administered?  To which
undertakings is the EU referring when it mentions the prohibition by the parties of the abuse by one or
more undertakings of a dominant position in the common market of the Community or in the territory
of the ACP States?G/C/W/321
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10. Declaration XXIII provides for the examination of all necessary measures in order to maintain
the competitive position of the ACP States in the Community market during the preparatory period,
including the consideration of, inter alia , calendar requirements, rules of origin, and sanitary and
phytosanitary measures.  Does this mean that the EU is considering the possibility of making changes
to the rules applicable during the preparatory period, and how would this be justified if the waiverrequest were granted?  On what basis will the competitive position of the ACP States in the
Community market be assessed, and when would the first examination take place?  Would sanitary
and phytosanitary measures differ according to the source of imports for members with equal sanitary
status?
11. In Declaration XXVII, it is stated that the Community shall have the right to change the
arrangements governing access to French markets in overseas departments for products originating in
the ACP States.  How could a different set of arrangements be adopted for these products in the eventof a waiver, without a prior description of the measure to be applicable to the new product or
products?
12. In Annex V, Article 3.1, it is stated that where the approximation of Community laws and
regulations is likely to affect the interests of AC P States, the Community shall, prior to adopting such
measures, inform those States.  How will the Community inform States when the interests of other
WTO Members would be affected?
13. With reference to Annex V, Article 9, in which the application of a safeguard clause is
established, what type of procedure will be applied when the alleged injury or threat of injury involvesimports from both ACP countries and other WTO Members?  Will two separate procedures exist
depending on the source of imports?  Would it be possible, according to the relevant procedures, to
apply safeguard measures outside of the MFN regime, or different measures depending on the source
of the imports which cause or threaten to cause injury?
14. With reference to Protocol 3, it is stated that the Community undertakes to purchase and
import, at guaranteed prices, specific quantities of cane sugar, raw or white, which originate in the
ACP States.  What is meant by "guaranteed prices", and how would this provision work in relation to
the obligations of the European Community and its member States under the Agreement on
Implementation of Article VII of the GATT 1994?  What would be the nature of the prices applied to
sugar imports from non-ACP countries, and how long would this regime be in force, given that the
waiver request lasts until 2008?
15. Why is a waiver being requested under Article I of the GATT for access for ACP countries to
the market of the European Community and its member States, since it is clear that in the Partnership
Agreement, quotas and guaranteed prices are being granted to the ACP countries?  How can this be
covered by a waiver of Article I?
I. Waiver of obligations under Article I of the GATT with regard to bananas
General aspects:
(1) Please indicate precisely all the relevant provisions of the Partnership Agreement
(hereinafter referred to as the Agreement) establishing the requirements for
preferential treatment for bananas originating in ACP States.  Furthermore, please
explain why each one of the relevant provisions is considered necessary.
(2) Please explain whether and how the requirements under the Agreement are different
from those under the waiver for the Lomé Convention, in force from
9 December 1994 to 29 February 2000.G/C/W/321
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(3) Please describe carefully all the measures concerning bananas included in the
requirements of the Agreement, including all those currently in force and/or those
which will be in force during the period to be covered by the requested
GATT Article I waiver.  Please explain why each measure is necessary in order to
fulfil a specific requirement provided for in the Agreement.
(4) Please indicate whether the EC considers that the measures concerning bananas
included in the requirements of the Agreement could be changed in the future.  Please
explain all circumstances under which that possibility might arise and the reasons
which would make it necessary to make changes in order to fulfil a specific
requirement provided for in the Agreement.
(5) Since the EC is requesting a waiver concerning bananas under both
Articles I and XIII of the GATT, would it be prepared to combine those requests,
putting them into a single text to cover bananas?
Proposed coverage of the GATT Article I waiver during the transitional period
(6) For the transitional regime for bananas lasting from 1 July 2001 to
31 December 2005, the EC has expressed an interest in having coverage for a tariff
preference of 300 euro/tonne to be applied to ACP banana imports "both within and
outside the tariff quotas".
(a) Please explain in detail how this pref erential margin would be applied to
quotas A and B.
(b) If the preferential margin will be applicable to quotas A and B, please explain
why this preference is necessary in order to meet a specific requirementprovided for in the Agreement.
(c) Please explain how this preference is consistent with the Understanding on
Bananas reached between the EC and the United States and Ecuador, given
that in both Understandings, it is stipulated that "the tariff applicable to
bananas imported in the A and B quotas shall not exceed 75 euro/tonne".
(d) From 1 July 2001, what is the volume of bananas imported from Latin
America under quota C and subject to a tariff preference of 300 euro/tonne,and what amount of Latin American imports is expected to be reached for the
whole year?
(7) Would the EC agree to the waiver decision indicating clearly which ACP tariff
preference applies solely to quota C, and that in quotas A and B all suppliers would
be subject to the bound tariff of 75 euro/tonne?
(8) If the reply to the previous question is that the ACP countries benefit from a zero
tariff in quotas A and B as well, my delegation would like to know what access
opportunities there could be in the future if the ACP countries have zero tariff in all
the quotas established by the EC, and if the C quota has been reserved exclusively forACP States too.G/C/W/321
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(9) We would like to know whether the EC intends the proposed waiver of obligations
under GATT Article I to cover other measures, apart from the tariff preference, such
as the administration of licences, quotas, or other non-tariff measures.  Please explain
why each of the measures would be necessary in order to fulfil a specific requirement
provided for in the Agreement.
(10) If an increase in the volume of the EC market occurs before 31 December 2005, for
instance due to an enlargement of the EU and an increase in demand, will that
increase be incorporated into the EU banana regime on a MFN basis in such a way
that it will would not be covered by the GATT Article I waiver?
(11) We would like to know if the EC intends the GATT Article I waiver to include the
possibility of the transitional tariff quota being extended beyond 31 December 2005.
Proposed coverage for the GATT Article I waiver from 1 January 2006 to 31 December 2007
(12) What specific level of tariff preference for ACP countries does the EC intend to
include in the GATT Article I waiver for the period 1 January 2006 to
31 December 2007?
(13) If it is impossible to give precise information concerning the specific level of tariff
preference for ACP countries to be applied during this period, are we to understandthat the EC is requesting the affected suppliers to grant a GATT Article I waiver for a
measure which it is currently incapable of describing?
(14) We need to know at what point during the period covered by the GATT Article I
waiver the procedures provided for in GATT Article XXVIII could be initiated inorder to renegotiate the current bound tariff, which is 75 euro/tonne, and when the EC
would hope to reach those negotiations in order to obtain a definition of the measure
which would be applied after 2005.
(15) Does the EC intend the GATT Article I waiver in the period following 2005 to cover
measures other than the tariff preference?  If so, please describe all the non-tariff
measures which would be covered, and explain why each one of these measureswould be necessary in order to fulfil a sp ecific requirement provided for in the
Agreement.
II. Waiver of obligations under GATT Article XIII
(16) In view of the EC, would the requeste d GATT Article XIII waiver be conditional
upon the transfer of 100,000 tonnes to the tariff quota available on a MFN basis?  If
so, would the EC be prepared to expressly include that condition in the draft decision
for the waiver?  If this cannot be indicated, please explain why, and if the EC does
not consider the condition to be applicable, please also provide an explanation.
(17) We would like to know if the waiver request for paragraphs 1 and 2 of GATT
Article XIII refers exclusively to the global tariff quota of 750,000 tonnes reserved
for ACP bananas, as indicated in documen t G/C/W/269.  If the EC has in view that
the  extension of Article XIII should provide broader coverage so as to include, inter
alia, the distribution of country quotas within quota C, please give a precise
explanation of the additional quota entitlements that would be covered, or of any
other measure which it is seeking to include.
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