WORLD TRADE
ORGANIZATIONTN/RL/W/87
2 May 2003
(03-2357)
Negotiating Group on Rules Original:  French
REPLIES TO THE QUESTIONS POSED BY AUSTRALIA1
CONCERNING THE DOCUMENT SUBMITTED
BY MOROCCO2
Communication from Morocco
The following communication, dated 29 April 2003, has been received from the Permanent
Mission of Morocco.
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Morocco wishes to thank Australia for its interest in the Moroccan communication on the
negotiations on the rules and disciplines of the Agreement on Implementation of Article VI of the
GATT 1994 and the Agreement on Subsidies and Countervailing Measures (TN/RL/W/36) and for thecomments and observations it made at the meeting of the Negotiating Group on Rules held on 6 and
7 February 2003, which are reproduced in document TN/RL/W/60.
This communication provides answers to the questions raised by Australia.
Question 1
Morocco considers that the negotiations should  be confined to clarifying and improving
the rules so as to limit any abuse in using trade remedies.  In order to better understand
Morocco's interpretation of the negotiating mandate, could Morocco provide examples of issues
which it would consider being within the mandate and of issues which would be outside the
mandate?
Reply
As was emphasized by Morocco in document TN/RL/W/36, the Doha mandate on
negotiations on the disciplines and rules for implementation of anti-dumping measures andcountervailing measures clearly establishes that the objectives of the negotiations should be confined
to clarification and enhancement of the rules and disciplines governing trade remedies for injurious
unfair competition, while preserving the basic concepts, principles and effectiveness of the Anti-
Dumping Agreement and the Agreement on Subsidies and Countervailing Measures and their
instruments and objectives.
Morocco considers, therefore, that the proposals to modify the rules or to add other rules
involving the weakening of the mech anism to combat injurious unfair trade practices and limiting the
                                                     
1 TN/RL/W/60.
2 TN/RL/W/36.TN/RL/W/87
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ability to implement the remedies provided for in the relevant agreements, go beyond the scope of the
mandate.
On the other hand, the proposals aimed at better defining or clarifying a concept or a
calculation methodology, or again at improving implementation of a procedure or establishing
guidelines for the application of provisions subject to divergent interpretations among Members,
respond to the objectives decided by the Doha Ministerial Declaration.
By way of example, some country Members3 have proposed modifying the rule governing
calculation of the "all others rate" provided for in Article 9.4 of the Anti-Dumping Agreement, which
stipulates that, when determining the anti-dumping duty to be applied to imports consigned by
exporters or producers not covered by the examination, no account need be taken of zero orde minimis  margins or of margins established under the circumstances referred to in Article 6,
paragraph 8, of the Anti-Dumping Agreement (margins established on the basis of the facts available).
In the context of the Negotiating Group on Rules, it is proposed quite simply to take account of zero
or de minimis  margins when determining the "all others rate".
In Morocco's opinion, this proposal is intended as a direct amendment of the rule, resulting in
the lowering of the "all others rate", which is inconsistent with Morocco's understanding of what is
meant by clarification and improvement of the rules.
Moreover, the proposal
4 aimed at raising the de minimis  level and the level of negligible
imports is highly illustrative in this regard.  Indee d, the proposal is designed to raise the level of the
de minimis  margin from a specified percentage (set at 2 per cent under Article 5.8 of the
Anti-Dumping Agreement) to a higher percentage leve l.  The same applies to the raising of the level
of negligible imports, which currently stands at 3 per cent.
Morocco considers that the proposal to modify th ese percentage levels is inconsistent with the
guidelines of the Doha Declaration, since any increase in the percentages in question would have the
effect of impairing the effectiveness of the anti-d umping instrument as a measure to combat injurious
unfair trade practices, without responding to a concern to clarify the rule governing de minimis
margins or negligible imports.
On the other hand, a proposal aimed at defining the basis on which the level of negligible
imports is to be calculated may be perfectly consistent with the Doha mandate, inasmuch as the
clarifications to be made to the period and the data to be used in determining the level of negligible
imports would serve to limit divergences of interpretation that might arise from the use of this rule,
and thereby to reduce the arbitrary element and improve the use of the rule.
Question 2
Given Morocco's concerns over the constraints placed on small economies, particularly
with regard to time-frames, does Morocco consid er that there is a need to accord special and
differential treatment to small economies?  If so, how would small economies be defined?
• Is Morocco suggesting expedited time-frames for anti-dumping investigations in
small economies or where the domestic market is small?
                                                     
3 Document TN/RL/W/10 of 28 June 2002.
4 Document TN/RL/W/6 of 26 April 2002.TN/RL/W/87
Page 3
• Does Morocco consider that small economies may have pockets of well-developed
industry sectors?  In such situations, should special and differential treatment beaccorded?
Reply
Morocco bases itself on the principle that the rules and disciplines governing implementation
of import trade remedies, apart from the differential arrangements applied to developing countries in
the context of special and differential treatment, are applicable across the board by all country
Members, whatever the size of their economies.  Accordingly, in negotiations for the improvement
and clarification of the rules, Morocco considers that account should be taken of the fact that the
effects of these practices are not felt in the same way on the domestic markets of Members, and that
country Members do not have the same capacity to deal with unfair trade practices.
A negotiating process based on a consensual approach can only achieve results when the rules
to which it gives rise are acceptable to all Members, including countries characterized by the small
size of their domestic market.  This can only be feasible if the rules in question take account of the
situation of those countries.
At this stage, Morocco is proposing neither the establishment of arrangements specific to
economies with a small domestic market nor the incorporation of the notion of small economies in the
provisions of the Anti-Dumping Agreement and the Agreement on Subsidies and Countervailing
Measures.  What is requested is that account be taken of the situation and constraints affecting allMembers in the negotiations on a rule which, in the final analysis, will be applied uniformly.
Question 3
Morocco considers that special and differential treatment should be limited to action
between developed and developing countries and that the scope of ADA Article 15 should not be
broadened to "curtail the legitimate right of developing countries to resort to anti-dumping
measures to offset injury caused by dumped expo rts from developing countries".  In Morocco's
view, should this notion also apply to Article 27 of the Subsidies Agreement and, if so, how could
this be done?
Reply
Although the Anti-Dumping Agreement and the Agreement on Subsidies and Countervailing
Measures exhibit a number of similarities regarding the application of remedies, an important
difference should be emphasized with regard to what may be considered an unfair trade practice.
Indeed, dumping is considered an unfair trade practice, whereas in the case of subsidies a
nuance is introduced by the criteria of development, inasmuch as subsidies are also considered as a
means of development and the resort to subsidies by developing countries was, in a sense, justified by
the special and differential treatment provisions of Article 27 of the Agreement on Subsidies and
Countervailing Measures, which authorized developing countries to evade certain obligations,including in particular the prohibition on the granting of export subsidies.
The debate about developing countries having recourse to subsidies because they may play an
important role in development programmes and in the extension of the time-limits established by the
special and differential treatment provisions of the Agreement on Subsidies and CountervailingMeasures, remains on the agenda of this Negotiating Group and of the Committee on Subsidies and
Countervailing Measures.TN/RL/W/87
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At the current stage of the negotiations, Morocco cannot prejudge what action may be taken
on special and differential treatment under the Agreement on Subsidies and Countervailing Measures,
and on the rules and disciplines that will be established to govern relations between developed and
developing countries and among the developing countries.
Question 4
We note that the focus of Morocco's paper is on trade remedies.  Given Morocco's
underlying concerns over the competition–distorting effects of subsidies, Australia would be
interested in Morocco's views on areas where it co nsiders that there is scope for clarifying and
improving the subsidy disciplines in the Subsidies Agreement.
Reply
It is true that Morocco's document TN/RL/W/36 focussed on the rules and disciplines
applicable to implementation of anti-dumping and countervailing measures, and Morocco emphasized
in passing that subsidization, like dumping, has trade-distorting effects.  However, the mitigatingfactor is that subsidies are also recognized, in the case of developing countries, as being capable of
playing an important role in the development programmes of those countries.
Consequently, in the negotiations on rules and disciplines in the field of subsidies, Members
should adopt a highly creative approach in order to reconcile the need to remedy any distortionscreated by subsidies with development needs.
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