WORLD TRADE
ORGANIZATIONG/RO/37
11 June 1999
(99-2354)
Committee on Rules of Origin
REPORT OF THE TECHNICAL COMMITTEE ON RULES OF ORIGIN
TO THE COMMITTEE ON RULES OF ORIGIN ON
PROGRESS MADE AT ITS SEVENTEENTH SESSION
In conformity with paragraph 4 of the Report of the Committee on Rules of Origin to the
Council for Trade in Goods on the Harmonization Wo rk Programme (G/RO/25), the Chairman of the
Technical Committee on Rules of Origin submitted to the Committee on Rules of Origin, on
9 June 1999, a Report on progress made at the Seventeenth Session of the TCRO.  The Report is
herewith circulated to Members, together with the letter of transmission of the Chairman of the
TCRO.
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Attached please find the Chairman's Progress Report covering the Seventeenth Session of the
Technical Committee on Rules of Origin and the Technical Committee's final results of the
Harmonization Work Programme1.
                                                     
1 To be circulated as document G/RO/37/Add.1.G/RO/37
Page 2
PROGRESS REPORT TO THE COMMITTEE ON RULES OF ORIGIN
FOLLOWING THE SEVENTEENTH SESSION OF THE
TECHNICAL COMMITTEE ON RULES OF ORIGIN
(HELD IN BRUSSELS FROM 17 to 28 MAY 1999)
1. The Technical Committee on Rules of Origin held its 17th Session in Brussels from 17 to 28
May 1999.  The Report of the 17th Session setting out the detailed results of the discussions has been
approved and is being separately transmitted as WCO Doc. OC0030E22.  The Session’s technical
examination covered rules of origin for specific products in Chapters 1-24, 50-63, 82-83, 84-90, and
91-97, as well as the overall architecture of the Harmonized Rules of Origin.  The Technical
Committee also discussed, in the context of future work, its permanent responsibilities under theAgreement on Rules of Origin.
Final Results under the Harmonization Work Programme
2. I am pleased to advise that the Technical Committee continued its work under the terms of
reference approved by the WTO General Council in July 1998, and recalled by the Chairman of the
Committee in his 23 April 1999 letter to me.  At the opening of the 17th Session I reminded
Members that under the agreed schedule the Technical Committee would submit its final results under
the Harmonization Work Programme (HWP) to the Committee at the conclusion of the Session.
3. The Technical Committee, having taken up its entire agenda during the Session, considers
that it has pursued its technical discussions of the harmonized rules of origin, given the time frame, as
far as possible.  The Technical Committee has authorized me to report the cumulative views
expressed and decisions reached during its seventeen sessions as the results of its work on
harmonization of rules of origin.  These results are submitted to the Committee for endorsement orfurther examination, as the case may be.
4. The WCO Secretariat has prepared a set of documents for submission to the Committee
which embody the Technical Committee’s final results :
- The Report of the 17
th Session is to be added to the previously submitted session reports of the
Technical Committee.
- As a result of discussions during the 17th Session, there are further unresolved issues, which
are being submitted to the Committee for decision in the form of Referral Documents.  These
are to be added to the Referral Documents previously submitted.
- A separate Referral Document has been prepared which covers all the chapter notes.  These
had not previously been submitted for endorsement or decision in most cases.
- The WCO Secretariat is preparing a final revision of the Consolidated Text incorporating all
decisions taken to date by both Committees.  The revision will reflect, among other things,
Basket 1 decisions on product-specific rules and in Chapter Notes on such items as
disassembly and packaging, which were reached during the past four sessions.  I draw your
attention to the supplementary material in the Consolidated Text, including a comprehensivelist of the unresolved issues submitted for decision by the Committee.  Several of these could
benefit from further technical discussion.
5. For the past twelve months the Technical Committee in all its sessions has conducted detailed
discussions of the Provisional Text containing the overall architecture of the Harmonized Rules of
                                                     
2 To be circulated as document G/RO/37/Add.1.G/RO/37
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Origin.  The current status of this work is reflected in Referral Doc. OC0029E, which is also
reproduced as Annex H/2 to the Report of the Technical Committee’s 17th Session.  The Technical
Committee decided at the 17th Session that the Provisional Text would be submitted to the Committee
with brackets indicating matters still under discussion and observations indicating the remaining
concerns of various Members.  In respect of certain questions of overall architecture the discussionswere considered to have been exhausted.  Templates on these questions have been prepared for
decision by the Committee as indicated.  Other matters, such as definitions, could have benefited from
further discussions had time permitted.
6. In my view there has been very significant progress in the development of the overall
architecture, notwithstanding the incomplete status of the text.  Difficulties, which emerged at the
15th Session over approaches to the application of primary and residual rules, were, at least inprinciple, resolved finally during the 17
th Session.  The twelve months of work have been a process of
establishing principles, agreeing on methods, clarifying intentions, reaching compromise, and
attempting to draft acceptable texts.  In this work all Members contributed.  Through sustained effort
the Technical Committee has given the Provisional Text a workable ultimate structure.
7. During the 17th Session the Technical Committee continued to examine residual rules
proposed for application to particular product sectors.  Ultimate or general residual rules are to be set
out in the overall architecture in Appendix 2, while product specific residual rules are normally to
appear at the chapter level.  To the extent possible, the Technical Committee has completed its
discussions and prepared appropriate Referral Documents.  The examination has not been completedin certain respects.  Certain Members advised the Technical Committee that although they intended to
make specific proposals for goods of Chapters 1-24; they had not been in a position to submit them
for consideration.  I would also note that the clos e relationship between residual rules and the overall
architecture has somewhat inhibited decision-making.  Some Members have noted their difficulties in
agreeing to a residual rule when the primary rule for a good is in dispute and awaiting decision by theCommittee.
8. I should mention that for goods of Chapter 97 (works of art, collectors’ pieces and antiques)
the Technical Committee decided not to pursue its discussions to a conclusion.  Members took note
that rules of origin for these goods have policy implications, which should be considered by other
bodies, and suggested that the Committee may wish to co-ordinate further discussions with
appropriate cultural policy organizations.
9. The Technical Committee has appreciated last July’s decision of the Committee to extend the
Harmonization Work Programme.  The further ten months allotted to the Technical Committee have
been fully utilized.  The Technical Committee has examined again all the chapters of the Harmonized
System to clean up all the unresolved product specific issues, particularly in the chapter notes.  It hasexamined and articulated proposals for residual rules.  Finally, it has significantly advanced the
Provisional Text on the overall architecture.  The Technical Committee’s final results can be
considered as the basis for completing the Harmonization Non-Preferential Rules of Origin.
10. In planning for completion of the HWP, the Committee may wish to take note of several areas
in which the Technical Committee could not conclude its consideration.  With respect to the overall
architecture, I believe matters are close to consensus on principles of approach and principles of
application.  There is still a need to articulate and elaborate these principles.  Concerning residual
rules, the discussion of certain product sectors was not completed, and there is work to be done inrespect of the origin criteria for general residual rules.  Matters of presentation also need to be settled;
it would be helpful to have decided on the presentation of the chapter notes and product-specific rules.
I know also that the Committee has much work before it to decide the Unresolved Issues previously
referred, most of which concern primary rules and substantial transformation.  The TechnicalG/RO/37
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Committee hopes that the Committee might find its work facilitated by the submission of the
Technical Committee’s final results.
Permanent responsibilities of the Technical Committee
11. During the 17th Session the Technical Committee also discussed its future work in the context
of the permanent responsibilities assigned to it under the Agreement.  The Technical Committee
requested that I draw your attention to Annex IJ to the Report of the 17th Session, a working document
prepared by the WCO Secretariat which discusses possible approaches to meeting these
responsibilities.
12. Note was taken that the Technical Committee is a permanent structure within the WCO, and
that pursuant to Annex 1 of the Agreement the Tech nical Committee has responsibilities, inter alia, in
respect of the technical aspects of the implementation and administration of rules of origin.  Members
welcomed the initiative of the WCO Secretary General to assess training and technical assistance
requirements for implementation.
13. Note was taken also that pursuant to Article 6 of the Agreement the Technical Committee is
to cooperate with the Committee in setting up a review mechanism to keep the Harmonized Rules of
Origin updated, particularly with respect to technological changes.  The Technical Committee
observed that this task of permanent review should include the review of amendments to the
Harmonized System to determine whether adjustments in the rules of origin are necessary inconsequence.  The Technical Committee looks forward to working with the Committee in the
implementation of these institutional arrangements.
Future work
14. The Technical Committee acknowledged that the WCO has tentatively made arrangements
for an 18th Session of the Technical Committee to be held in the fall of 1999.  Members are awaiting
guidance from the Council of the WCO and the Committee as to the length and subject matter of the
possible meeting.  It was concluded that for the time being a flexible approach was the only one
possible given that further decisions on the status of the Harmonization Work Programme were
imminent.
15. In closing, the Technical Committee has asked me  to emphasize that it remains fully at the
service of the Committee to help with the task of completing the Harmonization Work Programme.  If
required, I would be pleased to discuss with the Committee how this co-operation might be structured.
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