RESTRICTED  WORLD TRADE  
ORGANIZATION  G/RO/M/43 
9 December 2003 
 
 (03-6504) 
Committee on Rules of Origin  
  
 
MINUTES OF THE MEETING OF 3 OCTOBER 2003  
 
Chairman:  Mr. Stefan Moser
 
  
I.
 REPORT OF THE WORK OF THE TECHNICAL COMMITTEE ON RULES 
OF ORIGIN...................................................................................................................... .........1  
A. FOURTH PERIODIC REPORT ON TECHNICAL A SPECTS OF THE OPERATION AND STATUS 
OF THE AGREEMENT ....................................................................................................................2  
B. FOURTH ANNUAL REVIEW ON TECHNICAL ASPECTS OF THE IMPLEMENTATION AND 
OPERATION OF PARTS II AND III OF THE AGREEMENT .................................................................2  
C. PROPOSED TIMELINE FOR THE IMP LEMENTATION OF THE HARMONIZED NON -
PREFERENTIAL RULES OF ORIGIN ................................................................................................2  
D. TERMS OF REFERENCE AND WORK PLAN OF THE TCRO .............................................................2  
E. OTHER MATTERS .........................................................................................................................3  
II. NOTIFICATIONS UNDER ARTICLE 5 AND PARAGRAPH 4 OF ANNEX II 
OF THE AGREEMENT ON RULES OF ORIGIN (G/RO/N/39-41) ..................................3  
III. TRANSITIONAL REVIEW UNDER PARAGRAPH 18 OF THE PROTOCOL 
OF ACCESSION OF THE PEOPLE'S REPUBLIC OF CHINA (WT/L/432, WT/ACC/CHN/49, G/RO/53 AND G/RO/W/99/REV.1).......................................................3
 
IV. ANNUAL REVIEW OF THE IMPLEMENTATION AND OPERATION OF 
THE AGREEMENT ON RULES OF  ORIGIN (G/RO/W/97).............................................4  
V. ANNUAL REPORT (2003) TO THE COUNCIL FOR TRADE IN GOODS 
(G/RO/W/98) .................................................................................................................... .........6  
VI. ELECTION OF OFFICERS....................................................................................................6  
VII. OTHER BUSINESS................................................................................................................. .6 
A. DATES AND AGENDA FOR THE NEXT MEETING ............................................................................6  
 
 
I. REPORT OF THE WORK OF THE TEC HNICAL COMMITTEE ON RULES OF 
ORIGIN 
1.1 The representative of the WCO , Mr. P-P. de Vaucher, stated that the last session of the 
Technical Committee on Rules of Origin (TCRO) was held at the WCO headquarters in Brussels from 
24 to 25 February 2003, under the Chairmanship of Mr. Stefan Moser (Switzerland).  G/RO/M/43 
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 A. F
OURTH PERIODIC REPORT ON TECHNICAL ASPECT S OF THE OPERATION AND STATUS OF THE 
AGREEMENT  
 This Report, which covered the period from 1 January to 31 December 2002, described the 
work of the Committee on Rules of Origin (CRO) and the TCRO, the technical assistance activities 
undertaken at the request of Members, and the vari ous studies carried out by the Secretariat at the 
request of the TCRO (practical guidance on the impl ementation of the Agreement on Rules of Origin 
(the Agreement), comparative study on systems of certification, proposed mechanism for the 
amendment of the non-preferential rules of origin).  The Report had been adopted by the TCRO.  B. F
OURTH ANNUAL REVIEW ON TECHNICAL ASPECTS OF THE IMPLEMENTATION AND OPERATION 
OF PARTS II AND III OF THE AGREEMENT  
 This Annual Review covered the same period as the Periodic Report.  No specific problems 
or questions relating to Part II of the Agreement were  reported to the TCRO.  With regard to Part III 
of the Agreement, the TCRO discussed and e ndorsed the studies conducted by the Secretariat 
(practical guidance on the implementation of the Agreement, and comparative study on systems of 
certification).  The TCRO also discussed and ad opted a document entitled "Proposed mechanism for 
the submission of the views of the Technical Committee on Rules of Origin to the Committee on Rules of Origin for amendments to the harmonized non-preferential rules of origin".  Finally, in an 
informal session, Members exchanged views a nd opinions on a working document concerning 
technical rectifications.  
C. P
ROPOSED TIMELINE FOR THE IMP LEMENTATION OF THE HARMONIZED NON -PREFERENTIAL 
RULES OF ORIGIN  
 At the request of the TCRO, the Secretariat presented an indicative timetable for the practical 
implementation of the Agreement.  In that timetabl e, the steps to be taken for the implementation of 
the Agreement were set out chronologically: 
 
• Checking on the legal possibility of using inte rnational legal instruments (the Harmonized 
System, for example) and national legal instruments (control, investigation) 
• Organization and setting up of the ser vices responsible for origin matters 
• Informational activities aimed at the international trading community 
• Training activities for those involved with non-pref erential rules of origin (customs officers, 
Chamber of Commerce employees) 
• Use of the appropriate media to publicise the entry into force of the Agreement 
 
This timeline, which was optional and was intende d merely to provide practical guidance, was 
welcomed by the TCRO. 
 
D. TERMS OF REFERENCE AND WORK PLAN OF THE TCRO 
 In June 2002, the WCO adopted a Decision under which each WCO body must have simple 
terms of reference and work plans,  to be updated regularly, and must  report on their implementation.  
The draft terms of reference were based on the Agreement on Rules of Origin, and the Rules of 
Procedure of the TCRO.  The aim of the plan was to provide complete transparency where the work 
of the TCRO was concerned (evaluation of progress and outcomes of the work of the TCRO).  After some discussion, the texts presented were endorsed as a whole by the TCRO.   G/RO/M/43 
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 E. OTHER MATTERS  
Position regarding Members and observers of the Committee on Rules of Origin : 
 
• Armenia had become a ne w Member of the TCRO. 
 
• The Kingdom of Bhutan had become a new Member of the WCO. 
 
• The name of the Federal Republic of Yugos lavia had been changed to Serbia and 
Montenegro. 
 1.2 The CRO took note
 of the report and expressed appreciation for the TCRO's continued 
valuable work.   II. NOTIFICATIONS UNDER ARTICLE 5 AND PARAGRAPH 4 OF ANNEX II OF THE 
AGREEMENT ON RULES OF ORIGIN (G/RO/N/39-41) 
2.1 The Chairman
 recalled that since the last meeting the Secretariat had circulated three 
documents informing delegations of notifications submitted by Armenia, the Dominican Republic, 
Japan and the Kyrgyz Republic.  To date, 84 Memb ers had made notifications of non-preferential 
rules of origin and 89 Members had made no tifications of preferential rules of origin. 
 2.2 The Chairman
 expressed concern that a number of Members had not yet complied with the 
notification requirements.  He urged Members who ha d not yet notified to do so as early as possible. 
 
2.3 The CRO took note  of the statement. 
  
III. TRANSITIONAL REVIEW UNDER PARAGRAPH 18 OF THE PROTOCOL OF 
ACCESSION OF THE PEOPLE'S REPUBLIC OF CHINA (WT/L/432, 
WT/ACC/CHN/49, G/RO/53 AND G/RO/W/99/REV.1) 
3.1 The Chairman
 noted that in accordance with paragraph 18 of the Protocol of Accession of the 
People's Republic of China, the CRO was to repor t to the Council for Trade in Goods on the outcome 
of the Review which would then report to the General Council.  The Committee had conducted its 
first Review at the last meeting, where China had explained the implementation of its commitments 
with regard to rules of origin and responded to the questions raised.  He then invited China to make a 
general presentation on China's implementation of  the Agreement on Rules of Origin this year. 
 3.2 The representative of China
 stated, as the first point, that no new rules and regulations or 
administrative measures relating to non-preferential ru les of origin had been promulgated or amended 
since 11 December 2002. The legislations currently effective concerning rules of origin had been 
notified to the Committee and circulated in document G/RO/53. 
 3.3 The second point concerned current rules of orig in.  China’s laws and regulations on rules of 
origin, and the way China implemented them, were  in full conformity with the WTO Agreement on 
Rules of Origin.  China had never used rules of or igin as an instrument to pursue trade objectives 
directly or indirectly.  As concerned "review of the pre-determination of origin", she explained that in 
accordance with Article 8 of Announcement No.17, 2001 of the General Administration of Customs, 
the party dissenting to the decision made by the Customs may apply for administrative review or 
bring a suit before a people’s court.  In accordance w ith Article 6, the review had the right to change G/RO/M/43 
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 or annul specific pre-determination of origin made by the Customs.  The application of administrative 
or judicial review was based on Administrative Review Law of the People’s Republic of China, Provisions for the Implementation of Administrativ e Review Law of the Customs of the People’s 
Republic of China, and Administrative Procedure Law of the People’s Republic of China.  She further 
explained "punishment rule for false declaring of origin".  Actions such as false declaring of country 
or faking certificate of origin were dealt with by Customs according to rele vant stipulations of 
Customs Law of the People’s Republic of China a nd the Rules of Administrative Penalties for the 
Implementation of the Customs Law.  As con cerned "method of calculating value-added criterion 
mentioned in Article 3, Subparagra ph 2, of Provisional Regulations C oncerning the Rules of Origin of 
the Customs General Administration", the method ap plied was that the value-added component was 
more than 30 per cent in the total value of a new product, the calculation of which was that the CIF 
value of non-original component was 70 per cent or  less in FOB value of the product after being 
processed.  As concerned "confidentiality of informat ion for origin pre-determination", in accordance 
with Article 9 of Announcement No.17, 2001 of th e General Administration of Customs, the Customs 
would not disclose the information for origin pre-de termination without the specific permission of the 
person concerned, except to the extent that it may be required to be disclosed in the context of judicial 
proceedings.  As concerned " non-preferential ru les of origin for exports", China’s existing 
non-preferential rules of origin for exports were promulgated on 8 March 1992 and came into effect 
on May 1, 1992.  The rules were applied in issui ng Chinese certificate of origin for non-preferential 
exports upon request of consignee of the export and had no binding on importing side.  There was no 
origin declaration requirement by Customs for exports. 
 
3.4 The third point concerned the adoption of ha rmonized non-preferential rules of origin.  She 
stated that the WTO harmonization of non-preferential rules of origin, in technical terms, had been concluded to date.  However, 94 unresolved core  policy issues had been submitted to the General 
Council for political consideration.  China pledge d to fulfil its commitment in its Protocol of 
Accession to the WTO that the harmonized non-preferential rules of origin would be adopted and 
applied fully in China as soon as the harmonized work on rules of origin came to a close. 
 3.5 The Chairman
 drew attention to document G/RO/W/ 99/Rev.1 containing questions from the 
Separate Customs Territory of Ta iwan, Penghu, Kinmen and Matsu. 
 
3.6 The representative of Chinese Taipei  had noted China's considerable effort over the last year 
to meet its accession commitments in the area of rules of origin and appreciated very much the 
informative presentation made by the Chinese delegation at this meeting.  He believed that the smooth 
and faithful implementation of China's Protocol of Accession was in the best interests of all Members.  However Chinese Taipei would be equally apprecia tive if the statement made by China could be 
circulated to all Member.  He stated th at Chinese Taipei had no further questions. 
 3.7 The CRO took note
 of the statements made, and agreed  that the Secretariat prepare a short 
factual report under the Chairman's responsibility, toge ther with the minutes of the meeting for further 
detail, to be sent to the Council for Trade in Goods.  
 
IV. ANNUAL REVIEW OF THE IMPLEMENTATION AND OPERATION OF THE 
AGREEMENT ON RULES OF ORIGIN (G/RO/W/97) 
4.1 The Chairman
 noted that the Secretariat had circulated, in document G/RO/W/97, the draft 
Review of the Implementation and Operation of the Agreement. 
 
4.2 Although Article 6.1 required that the CR O review annually the implementation and 
operation of Parts II and III of the Agreement, the CRO's main concern had been the work under Part 
IV of the Agreement namely the Harmonization Wo rk Programme, to which the CRO's formal and  G/RO/M/43 
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 informal sessions were devoted up until the end of th e previous year.  After forwarding 94 core policy 
issues to the General Council for discussion and d ecision at that level, however, the CRO was 
mandated by the General Council to complete the remaining technical work only after resolution of 
those 94 issues by the General Council.  This was the reason why the CRO had not held any meetings 
since November 2002.  Nonetheless, the Chairman and Vice-Chairman, on behalf of the Chairman of 
the General Council, had conducted intense consultations on the 94 issues with Members this year, 
and the Chairman had made a progress report to th e General Council thereon.  For the benefit of 
Members the Chairman presented this same information on the outcome of the consultations as follows:  
4.3 In order to bridge the existing gaps among Members concerning the 94 issues, following 
extensive, one-to-one small groups  and open-ended cons ultations held with Members since the 
autumn, he had circulated a proposal intended as a balanced package, which was contained in 
document JOB(03)/132.  Unfortunately, however, it ha d not been possible to reach consensus on this, 
and consequently the deadline for completion of this  work had been missed for a fifth time.  He 
summarised the state of play as follows:  Concer ning the implications issue, there had been a 
discussion about the understanding among Members on three notions:  (1) that the harmonized rules of origin should be applied only for goods, not fo r services or intellectual property;  (2) that the 
harmonized rules of origin should be applie d equally for non-preferential commercial policy 
instruments, whenever a Member was required – or  in the absence of such requirement, voluntarily 
decided – to determine the country of origin;  and (3) that there were some non-preferential 
commercial policy instruments where an origin determination was not necessary. 
4.4 It appeared that there was almost agreement on the first two notions, although some Members 
had raised a question as to whether any WTO agreemen t required a Member to apply rules of origin.  
However, Members had differing views on the third notion – that is, some Members argued that the text proposed by the Chairman fo r resolution of the implications i ssue should designate explicitly the 
specific commercial policy instruments for which an  origin determination was irrelevant, such as 
marking and labelling requirements or SPS meas ures.  Other Members were opposed to any 
carving-out of specific commercial policy instruments, as Article 3(a) of the Agreement did not create any new rights or obligations under the WTO Ag reement.  Due to these differing views, the 
implications issue remained  unresolved but resolvable. 
 
4.5 As for the 93 product-specific rules, there were several genuinely political issues, the 
resolution of which appeared impossible at the presen t stage, such as the issue of fish taken from the 
Exclusive Economic Zone, or the sugar issue.  Ther e were also other issues that were closely linked 
with other trade policy issues, such as circumven tion of anti-dumping duties, export subsidy policies 
in agriculture, and textile quotas, the resolution of which appeared to be difficult unless the related 
issues were resolved in other bodies or sub-bodies of the WTO.  However, many Members had 
considered the CRO Chair's proposal as a good basis for further work.  There had been a discussion 
on the need for a possible new working methodology in order to facilitate the negotiations.  This issue 
would be further discussed at  the next consultations. 
 4.6 The representative of Brazil
 suggested revising paragraph 3.4 in order to say explicitly that 
the work on harmonizing rules of origin at pr esent was in the hands of the General Council. 
 4.7 The Committee agreed
 to the suggested amendments and adopted  the Annual Review of the 
Implementation and Operation of the Agreemen t on Rules of Origin contained in document 
G/RO/W/97.  The document will be revised to incl ude the agreed amendments and issued in the 
G/RO/- series. 
  G/RO/M/43 
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 V. ANNUAL REPORT (2003) TO THE COUNCIL FOR TRADE IN GOODS 
(G/RO/W/98) 
5.1 The Chairman
 noted that the Secretariat had circulated a draft of the CRO's report to the 
Council for Trade in Goods, as required by Article  6.1 of the Agreement (G/RO/W/98), and that 
paragraph 5 should be revised as sugge sted by Brazil under agenda item IV. 
 
5.2 The CRO adopted  its revised annual report to the CTG (G/L/656). 
  
VI. ELECTION OF OFFICERS 
6.1 The CRO elected
 Mr. Syed Habib Ahmed (Pakistan) as Chairman of the CRO for 2003.  The 
CRO agreed  to postpone the election of Vice-Chairpers on and to take up this matter at its next 
meeting.   VII. OTHER BUSINESS 
A. D
ATES AND AGENDA FOR THE NEXT MEETING  
7.1 The Chairman  suggested that the dates and agenda for the next meeting be set in consultation 
with delegations and also in light of  developments in the General Council. 
 
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