RESTRICTEDWORLD TRADE
ORGANIZATIONWT/WGTCP/M/7
23 December 1998
(98-5164)
Working Group on the Interaction
between Trade and Competition Policy
REPORT ON THE MEETING OF 17-19 NOVEMBER AND 4 DECEMBER 1998
Note by the Secretariat
1. The seventh meeting of the Working Group on the Interaction between Trade and
Competition Policy took place on 17-19 November and 4 December, under the Chairmanship of
Professor Frédéric Jenny.
I. FURTHER CONSIDERATION OF THE ELEMENTS OF THE GROUP'S WORK
PROGRAMME, AS INCORPORATED IN THE CHECKLIST OF ISSUES
SUGGESTED FOR STUDY
2. The representative of the Dominican Republic raised a concern regarding the impact on trade
and competition of provisions incorporated in concession or licensing agreements that limited firms to
manufacture or distribute products in a particular country or countries.  Such provisions impacteddirectly on the possibility of free trade outside the countries referred to in the concession.  Examples
of sectors where concerns had arisen regarding this practice included tobacco and alcoholic
beverages.  He was informed that similar concerns  had arisen in other countries in relation to the
automobile sector, in which concession agreements for companies operating in the Andean Pact had
apparently affected their ability to export into Mercosur countries.  While in some cases, the practice
also touched on questions involving trade and investment and intellectual property rights, it clearly
raised concerns relating to the impact of anti-competitive practices of enterprises on internationaltrade.  The practice generated protectionist attitudes on the part of companies that were otherwise
competitive.  It merited consideration in future meetings of the Group and/or by successor bodies.
II. THE WORKING GROUP'S REPORT TO THE GENERAL COUNCIL, INCLUDING
CONSIDERATION OF ANY RECOMMENDATIONS REGARDING AREAS THAT
MERIT FURTHER CONSIDERATION IN THE WTO FRAMEWORK
3. The Group divided its consideration of this item into two elements:  (a) the descriptive part of
the report;  and (b) a recommendation to the General Council to be incorporated in the report.
A. T
HE DESCRIPTIVE PART OF THE REPORT
4. The Group had before it a draft of the descriptive part of the report (Job No. 6050, dated
10 November 1998), which had been prepared by the Secretariat as requested at the Group's previousmeeting (WT/WGTCP/M/6, paragraph 89).  The Chairman recalled the nature of this part of the
report and the guidelines given to the Secretariat for its drafting.  It was to describe the substance ofthe work which had been done so far in the Group.  It was to be based on the records of the meetings.
It was further understood that this part of the report should be factual, descriptive and balanced, it
should reflect the views that had been expressed by Members and should not attempt to highlightWT/WGTCP/M/7
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areas of agreement or disagreement.  It would also be without prejudice to the possibility of any issues
being reverted to in the future work of the Group.
5. The Working Group adopted the descriptive section of the report, on the understanding that
minor corrections and additions which were agreed to by Members would be made by the Secretariat
before the report was circulated to the General Council.
B. THE GROUP 'S RECOMMENDATION TO THE GENERAL COUNCIL
6. Following informal consultations, the Group adopted the following recommendation to be
included in its report:
"Paragraph 20 of the Singapore Ministerial Declaration provides, inter alia ,
that the General Council will keep under review the work of the Working Group on
the Interaction between Trade and Competition Policy established under that
provision and will determine, after two years, how the work of the Working Group
should proceed.
The Working Group recommends that the General Council decide as follows:
The Working Group shall continue the educative work that it has
been undertaking pursuant to paragraph 20 of the Singapore Ministerial
Declaration.  In the light of the limited number of meetings that the Groupwill be able to hold in 1999, the Working Group, while continuing at each
meeting to base its work on the study of issues raised by Members relating to
the interaction between trade and competition policy, including
anti-competitive practices, would benefit from a focused discussion on:
(i) the relevance of fundamental WTO principles of national treatment,transparency, and most-favoured-nation treatment to competition policy and
vice versa;  (ii) approaches to promoting cooperation and communication
among Members, including in the field of technical cooperation;  and (iii) the
contribution of competition policy to achieving the objectives of the WTO,
including the promotion of international trade.  The Working Group willcontinue to ensure that the development dimension and the relationship with
investment are fully taken into account.  It is understood that this decision is
without prejudice to any future decision that might be taken by the General
Council, including in the context of its existing work programme."
7. The representative of Mexico asked for the floor before the adoption of the recommendation
of the Working Group in order to inform Members that Mexico had the intention of submitting a draft
recommendation on the subject of the interaction between trade and competition policy in the contextof paragraphs 9, 10 and 11 of the WTO's Minister ial Declaration of last May.  He said that
recommendations or decisions by subsidiary bodies such as the Working Group on the Interaction
between Trade and Competition Policy could not change or supersede the terms of a mandate set out
in a Ministerial Declaration.  In particular, they could not change the non-exclusive nature of the
mandate given to the Group in paragraph 20 of the Singapore Ministerial Declaration.  Hisdelegation's joining of the consensus on the Group's recommendation reflected this understanding.
8. The representative of India said that, as Members knew, his delegation had had certain
concerns regarding the non-exclusivity of the future work to be undertaken by the Group.  It had
expressed these concerns at the informal meeting, in which it had stated that Members must have the
freedom to raise issues that may be of interest to them as mandated under paragraph 20 of theSingapore Ministerial Declaration and that an enumer ation of issues, however broad, as a focus to theWT/WGTCP/M/7
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future work, would therefore not in any way limit this non-exclusivity.  His delegation was happy that
it had since been able to join the consensus, on the understanding that the draft recommendation to the
General Council explicitly incorporated these concerns and that, as had been the tradition in the WTO,
Members would continue to have the freedom and the flexibility to raise issues of interest to them in
future meetings of the Working Group.
9. The representative of Singapore, speaking on behalf of ASEAN WTO Members, said that
ASEAN supported the text of the Recommendati on.  The Recommendation struck a very careful
balance.  Two aspects of the Recommendation were of great importance to ASEAN:  firstly, that it
reaffirmed paragraph 20 of the Singapore Ministerial Declaration as the working parameters of the
Group in 1999, and secondly, that it upheld the principle of non-exclusivity.
10. The representative of Pakistan said that his delegation was happy that the Working Group
would continue its useful educative work on the basis of paragraph 20 of the Singapore Ministerial
Declaration.  It looked forward to raising issues of  concern to Pakistan in the forthcoming meetings of
the Working Group and to having these addressed by the Members of the Group.
11. The complete report of the Working Group was submitted to the General Council as
document WT/WGTCP/2.
III. REQUESTS FOR OBSERVER STATUS FROM INTERNATIONAL
INTERGOVERNMENTAL ORGANIZATIONS
12. The Working Group agreed to revert to requests made by SELA, the Organization of the
Islamic Conference and the South Centre at its next meeting, should the General Council agree that it
should continue its work, having regard to the ongoing consultations on related matters in the
framework of the General Council.
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