WORLD TRADE
ORGANIZATIONG/C/W/392
11 July 2002
(02-3871)
Council for Trade in Goods Original:  English
TRADE FACILITATION ISSUES IN THE DOHA MINISTERIAL DECLARATION
REVIEW OF THE GATT ARTICLES
ARTICLE X
Communication from the World Customs Organization
The following communication, dated 21 May 2002, has been received from the World
Customs Organization.
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Introduction
1. The WTO Ministerial Conference in Doha in November 2001 agreed on the historic
Ministerial Declaration that contained a Work Programme  in which trade facilitation has been
identified as one of the items to be considered during the period leading up to the next Ministerial
Meeting.   The Work Programme foresees that, in the period until the Fifth Session of the Ministerial
Conference, the Council for Trade in Goods shall review and, as appropriate, clarify and improve
relevant aspects of Articles V, VIII and X of the GATT 1994 and identify the trade facilitation needsand priorities of Members.
2. We welcome the reference to Trade Facilitation in the Declaration since we understand that
one of the focus areas for trade facilitation is Customs procedures., Over the years, GATT
negotiations have resulted in a substantial reduction in tariff levels, and it is therefore natural that the
focus of the trading  community has gradually shifte d to non-tariff barriers.  These include ineffective
and expensive procedural and documentary requirements which have to be completed at nationalborders and which act as a disincentive to development of industry, commerce and trade.  These
requirements may result in the cost of complying with trade procedures becoming higher than the
duties and taxes that are to be paid.
3. At the same time, there has been a growing recognition of the role that Customs can play in
economic and social development through the promotion of trade and investment.  The manner in
which the Customs functions to expedite the movement of goods across borders has a significant
impact on the economic competitiveness of nations; it encourages investment and the development of
industry.  It also increases the involvement of sm all and medium-sized enterprises in international
trade.  In fact, the effectiveness and expeditiousness of border measures have been one of the majorfactors in the determination of foreign direct investment by multinational corporations.
4. Needless to say, the role of Customs is not limited to trade facilitation - other functions such
as revenue collection and protection of society are also highly important.  Many least-developed and
developing countries still heavily depend on Customs duties to ensure their national revenue.Customs also assumes the role of protection of society against the inflow of hazardous goods, such as
illicit drugs.  The terrorist attacks of September 11 have highlighted the role of Customs in protecting
national security.  In addition, Customs also plays an important role in other areas such as collectionG/C/W/392
Page 2
of trade statistics, which serves as the basis for WTO market negotiations.  With its multipurpose role,
we are convinced that Customs is a critical institution to good governance, prosperity and the
protection of society.  We also believe that the Customs community can make a  very positive
contribution to promoting trade facilitation, while discharging its other functions effectively.
5. Recognizing the case for trade facilitation, Customs procedures have undergone substantial
changes to ensure a balance between the different functions of Customs,  namely providing
facilitation for legitimate trade while exercising appropriate controls for the protection of society and
revenue collection.  In order to avoid congestion and delays at the border in the clearance of goods,
Customs activities have expanded to the pre-arrival and post-clearance stages.  Examples of this are
the use of pre-arrival information in respect of goods and persons to speed up clearance, as well as
post-clearance audit to ensure compliance.  The development of information technology has enabled
Customs to improve its risk management techniques through better access to information on traders.
These measures require co-operation between Customs and the trading  community.  On the one hand,
they enable Customs to effectively deploy its limited resources, while on the other, they enable traders
with a good compliance record to benefit from the simplified procedures specifically designed for
authorized compliant traders.  Customs has also expanded its co-operation with other governmentagencies to enhance the smooth flow of goods,  especially through co-ordinated interventions.
6. It is against this background that the WCO has been working since 1952 as an
intergovernmental body whose mission is to enhance Customs cooperation.  The WCO has 161
Member administrations world-wide, accounting for 97 % of world trade.  To fulfil its mission, the
WCO develops and maintains instruments and recommendations for the standardization and
simplification of Customs systems and procedures governing the cross-border movement of goods.
We also provide Members with training and technical assistance to implement trade and Customs
instruments and best practices
.
7. The WCO has developed and circulated instruments that provide principles for simple,
effective and modern procedures.  We offer solutions that allow countries to meet their legitimategoals of revenue collection and protection of society, while at the same time delivering practical trade
facilitation dividends.  The uniform, predictable and transparent application of these instruments
facilitates international trade, while also ensuring compliance with national laws and regulations.
These modern principles for simplification of procedures to provide trade facilitation were later
incorporated in a single instrument as ”The International Convention on the Simplification andHarmonization of Customs Procedures”, or the “Kyoto Convention” adopted in 1973.  We
continuously update our instruments to keep abreast of developments in information technology and
in Customs techniques such as risk management, and to take account of the highly competitive
business environment.  As a result of years of deliberation among our Members, the revised Kyoto
Convention of 1999 contains international standards that provide the predictability and efficiency that
modern trade and commerce require.  Many countries have already incorporated the principles of the
revised Kyoto Convention in their national legislation even without waiting for its formal entry inforce.
Compatibility of principles in the WCO In struments and GATT Articles V, VIII and X
8. As stated at the outset, the WCO welcomes the Doha Ministerial Declaration’s recognition of
the case for further trade facilitation and the need for enhanced technical assistance and capacity
building in this area.  We see our role as being complementary to the WTO in developing instruments
to support the WTO rules as explained below.  Another important and also complementary role is
delivering training and technical assistance to implement those rules. We are keen to intensify our
capacity building in all areas related to trade facilitation.G/C/W/392
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9. All the legal provisions and the principles in the WCO instruments are compatible with, and
complementary to, the three GATT Articles referred to in the context of trade facilitation in the Doha
Ministerial Declaration.  There is a clear recognition that Customs procedures and their
implementation exert a great impact on world trade and the international movement of goods across
borders.
10. The GATT Articles set out the high principles for formalities and procedures for movement
of goods, transit of goods and publication and administration of trade regulations.  On the other hand,
the instruments of the WCO - including the Kyot o Convention through its legal provisions and
implementation guidelines - provide the basis a nd practical guidance and information for the
implementation of these high principles.
Overview of the Revised Kyoto Convention
11. The key principles of the Kyoto Convention are set out in three parts – the Preamble and
Articles to the Convention, the General Annex containing the core principles and the Specific
Annexes dealing with each separate operation that goods may be subject to.
• The Preamble  of the revised Convention contains the key principles of modern Customs
administrations and includes :
- the application of Customs procedures and practices in a predictable, consistent and
transparent manner;-  provision of information on Customs laws, regulations, procedures and practices;
-  adoption of modern techniques such as risk management;
-  maximum practicable use of information technology;
-  co-operation where appropriate with other national authorities, other Customs administrations
and the trade;-  implementation of relevant international standards; and
-  provision of easily accessible administrative and judicial review to affected parties.
• The Articles of the Convention  provide for clear rules for accession and administration of the
Convention.
• The Convention contains a General Annex and ten Specific Annexes.  The provisions of these
Annexes reflect modern procedures and address the requirements of both the trade and Customsadministrations.  They also incorporate modern methodologies to ensure that Customs is able to
carry out its responsibilities more efficiently and effectively, and facilitate the international
movement of goods while ensuring full compliance with national laws.
• A General Annex  contains the core procedures and practices which  are the basis for all
procedures for the movement and clearance of goods for import and export, including goods intransit.  The General Annex contains Standards and Transitional Standards
1 which are obligatory
for accession and implementation by Contracting Parties and no Reservations  can be entered
against these Standards and Transitional Standards .
                                                     
1 “Standard”  means a provision the implementation of which is recognized as necessary for the achievement of
harmonization and simplification of Customs procedures and practices;
“Transitional Standard” means a Standard in the General Annex for which a longer period for implementation is
permitted;G/C/W/392
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• The General Annex includes Standards for the clearance of goods, payment of duties and taxes,
Customs and trade co-operation, information to be supplied by Customs and appeals in allCustoms matters – areas that of concern both to Customs administrations and to the trade.  It also
includes Standards that set out the principles of modern Customs control, including risk
management, audit-based controls and mutual administrative assistance between Customs
administrations and with external organizations, and the use of information technology, thusensuring both effective controls and trade facilitation.
• There are ten Specific Annexes  dealing with different Customs procedures which contain
Standards and Recommended Practices
2.
• Comprehensive implementation Guidelines  have been developed for all Standards and
Recommended Practices in the Annexes to the Convention.  These are a set of explanations of the
provisions of the General Annex, Specific Annexes and Chapters therein which indicate some of
the possible courses of action to be followed in applying the Standards, Transitional Standards
and Recommended Practices, and in particular describing best practices and recommending
examples of greater facilities.  These Guidelines ensure that the principles and simplified Customs
procedures contained in the Convention are applied effectively by Customs administrations. The
Guidelines are constantly updated to provide information on new and modern practices, which in
the future will form the basis of legal texts in the Annexes to the Convention.
• Present level of implementation of the revised Kyoto principles  – Though the revised Kyoto
Convention is yet to enter into force, a large number of WCO Members have already revised or
are in the process of revising and modernizing their Customs legislation based on this revised
Convention.
Article X of the GATT as reflected in WCO instruments and Customs legislation
12. Article X of GATT 1994 - Publication and Administration of Trade Regulations - requires in
the main that :
• All laws, regulations, judicial decisions and administrative rulings affecting imports and exports
be published ; measures that impose a new or more burdensome requirement, restriction, or
prohibition on imports, or on the transfer of payments are to be published before enforcement.
• With regard to Appeal procedures, Members should “maintain or institute judicial, arbitral or
administrative tribunals or procedures for the purpose, inter alia , of the prompt review and
correction of administrative action relating to customs matters", providing for uniform, impartial,and reasonable administration of laws, decisions and rulings affecting import and export.
Publication and availability of information
13. To ensure predictability, efficiency and integrity, all laws and rules that govern Customs
systems and processes must be readily available to all parties involved in in ternational trade.  This
availability of information provides transparency both to trade and to governments with regard to
rules, rights and obligations of all parties involved in the movement and clearance of goods through
Customs.  It also ensures, for the trading community , a high degree of predictability of the processes
involved.  Thus, publication of Customs laws, rules and the requirements to be fulfilled and how they
are implemented and administered guarantees tr ansparency, improves efficiency and promotes
                                                     
2 “Recommended Practice”  means a provision in a Specific Annex whic h is recognized as constituting progress
towards the harmonization and the simplification of Customs procedures and practices, the widest possible application of
which is considered to be desirable;G/C/W/392
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integrity.
14. The principles of transparency through publication of laws, regulations, administrative
guidelines, and executive instructions - collectively defined as Customs Law in the Kyoto Convention
- have been reflected clearly in WCO legal instruments, Recommendations, best practices and in theCustoms legislation of countries.  The requirements for publishing information relating to Customs,
the setting up of an appeals procedure and information concerning tariff classification of goods were
recommended to Customs administrations though WCO instruments as early as the 1960s.
Principles in the Revised Kyoto Convention
15. Chapter 9 of the General Annex  to the Kyoto Convention relates to “Information, Decisions
and Rulings Supplied by Customs”.  The legal text is at Annex I  to this paper.
16. This Chapter provides for :
• Making readily available to interested persons information of general application regarding
Customs laws, i.e. all statutory and regulatory provisions - including those specifically assigned to
Customs and any regulations made by the Customs under its statutory powers.  This information
should also be made available in electronic format where possible;
• Making available changes to information supplied due to amendment of law, administrative
arrangements and requirements sufficiently in advance of the entry into force of the new
requirements, except in instances where advance notice is precluded;
• Making available, as quickly and accurately as possible, specific information requested (tariff
classification, duties and taxes, documentary and procedural requirements, etc.);
• Confidentiality of information – not to divulge details of a private or confidential nature affecting
the Customs or the trade unless required or authorized by national legislation;
• Providing information free of cost or limit ing the cost to the services rendered;
• Providing decisions in writing within a period specified in national legislation when requested
and, where the decision is adverse to the person concerned, reasons to be provided and right of
appeal to be advised; and
• Issue of binding rulings on the request of the interested person, provided all information deemed
necessary is made available.
17. The Guidelines to this Chapter  provide detailed information for administrations to set up
their procedure for publication of information.  These include :
- information on quality and clarity of information,
-  trade consultation,
-  exhibitions,
-  enquiry offices,
-  availability of tariff information,
-  liability of information provided,-  explanation of the concept of freedom of information,.
-  procedure for issue, notification and annulment of binding rulings by Customs.G/C/W/392
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18. The Guidelines also contain information on the method used by Member administrations and
the EU on provision of information of differen t types.  The WCO Recommendation on the use of
World Wide Web sites by Customs administrations also expands on the application of the legal
provision for use of information technology to enhance the supplying of information.
Appeal procedures
19. All persons who deal with Customs must be afforded the opportunity to lodge an appeal on
any matter.  Persons who deal with the Customs may be affected by a decision or omission on the part
of the Customs.  It is therefore important that provision be made for the person concerned to be given,
upon request, an explanation of the reasons for the decision or omission, and for the person to have a
right of appeal to a competent authority.  The competent authority may be the Customs itself, anotheradministrative authority, one or more arbitrators, a special tribunal and, in the final instance, a judicial
authority.
20. This right of appeal ensures protection for the individual against decisions of Customs that
may not be in compliance with the laws and regulations which it is responsible for administering andenforcing.  It also ensures protection against omissions by Customs in any matter.  At the same time,
the review of challenged decisions or omissions by  a competent authority and the verdicts of these
reviews can be a suitable means of ensuring uniform application of the laws and regulations. The
provisions of the revised Kyoto Convention provide for a transparent and multi-stage appeal process.
Furthermore, the availability of an independent j udicial review as a final avenue of appeal should
inspire the public and the trade with confidence in the government institutions and, in particular, in
the Customs administration.
Principles in the revised Kyoto Convention
21. Chapter 10 of the General Annex  sets out the principles for “Appeals in Customs Matters.”
The legal text is at Annex II  to this paper.
22. This Chapter provides for :
• National legislation to provide for a right of appeal in Customs matters;
• Reasons for a decision or omission by Customs to be  provided in writing within a period specified
in national legislation, and persons affected by these to have a right of appeal;
• Different levels of appeal including initial appeal to Customs, further appeal to an authority
independent of the Customs administration and fi nal right of appeal to a judicial authority;
• Forms and grounds of appeal, including fixing of a time limit for lodgement of an appeal that
should be sufficient to study the contested decision and prepare the appeal.  Sufficient time to beprovided for lodgement of supporting documents for the appeal.
• The methods for ruling on appeals and advising the right to further appeal;
• Consideration of appeals; and
• Implementing the decision or ruling of the independent or judicial authority.G/C/W/392
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23- The Guidelines to this Chapter contain detailed information for administrations to develop
and set out their appeal procedure.  The rights of appeal are also set out for tariff classification issues
in appropriate Recommendations under the Harmonized System Convention.
Other related provisions of the Kyoto Convention General Annex
24. In addition to these two specific Chapters 9 and 10 of the General Annex, there are several
other provisions in the General Annex that enhance and supplement the transparency of Customs
procedures that establish Customs trade consultations and rights and obligations of related parties.
They provide for:
• Customs to institute and maintain formal consultative relationships with the trade – “The Customs
shall institute and maintain formal consultative relationships with the trade to increase co-
operation and facilitate participation in establishing the most effective methods of working
commensurate with national provisions and international agreements.” Standard 1.3  - General
Annex.
• Memoranda of Understanding with the trade to enhance effectiveness – “The Customs shall seek
to co-operate with the trade and seek to conclude Memoranda of Understanding to enhance
Customs control”:  Standard 6.8 – General Annex.
• Provisions in Chapter 3 of the General Annex dealing with the rights and obligations of a
declarant.
• Provisions in Chapter 3 to allow release of goods even when an offence is detected – “When an
offence has been detected, the Customs shall not wait for the completion of administrative or legal
action before they release the goods, provided that the goods are not liable to confiscation or
forfeiture or to be needed as evidence at some later stage and that the declarant pays the duties
and taxes and furnishes security to ensure collection of any additional duties and taxes and of any
penalties which may be imposed.”  Standard 3.43 – General Annex.
• Chapter 8 of the General Annex, which sets out the provisions for the relationship between
Customs and third parties3, including their rights and obligations.
Significance of the principles of the Kyoto Convention for WTO Agreements implemented by
Customs
24. Several WTO Agreements have a direct bearing on trade facilitation and, in many instances, it
is the Customs which is directly involved in implementation of these Agreements.  The national
requirements of these agreements have to be confirmed at the borders before clearance of the goods.
Thus, the publication and administration of trade regulations in these areas are often within the
purview of Customs administrations .  Examples of the WTO Agreements are :
- Agreement on Customs Valuation,
- Agreement on Origin,
- Import Licensing Procedures,
- Rules of Origin,
- Agreement on the Application of Sanitary and Phytosanitary Measures.
- Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
                                                     
3 “third party”  means any person who deals directly with the Customs, for and on behalf of another person, relating to the
importation, exportation, movement or storage of goods.G/C/W/392
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Technical assistance
25. The WCO Technical Assistance Programmes, including dedicated assistance to individual
Members as well as regional seminars and other programmes, are available for WCO Members.
These are aimed at explaining the legal provisions, examining national legislation with a view to
making changes to provide for compliance with the revised Kyoto principles, and reviewing national
legislation that is revised or in the process of being drafted.  In addition, there is a detailed programme
for technical assistance for the implementation of the Harmonized System which includes theprocedures for improvement of tariff classification work and related infrastructure which are
compatible with - and supplement - the publication of information, the issue of pre-entry classification
and the setting up of appeal procedures.
Additional information
26. The legal texts of the revised Kyoto Convention and its implementation Guidelines and other
related instruments, such as the Recommendations on the Harmonized System, are available on the
WCO Web site – www.wcoomd.orgG/C/W/392
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Annex I
CHAPTER 9
INFORMATION, DECISIONS AND RULINGS SUPPLIED BY THE CUSTOMS
A. INFORMATION OF GENERAL APPLICATION
9.1. Standard
The Customs shall ensure that all relevant in formation of general application pertaining to
Customs law is readily available to any interested person.
9.2. Standard
When information that has been made available must be amended due to changes in Customs
law, administrative arrangements or requirements, the Customs shall make the revised information
readily available sufficiently in advance of the en try into force of the changes to enable interested
persons to take account of them, unless advance notice is precluded.
9.3. Transitional Standard
The Customs shall use information technology to enhance the provision of information.
B. INFORMATION OF A SPECIFIC NATURE
9.4. Standard
At the request of the interested person, the Customs shall provide, as quickly and as
accurately as possible, information relating to the specific matters raised by the interested person andpertaining to Customs law.
9.5. Standard
The Customs shall supply not only the information specifically requested but also any other
pertinent information which they consider the interested person should be made aware of.
9.6. Standard
When the Customs supply information, they shall ensure that they do not divulge details of a
private or confidential nature affecting the Customs or third parties unless such disclosure is required
or authorized by national legislation.
9.7. Standard
When the Customs cannot supply information free of charge, any charge shall be limited to
the approximate cost of the services rendered.G/C/W/392
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C.  DECISIONS AND RULINGS
9.8. Standard
At the written request of the person concerned, the Customs shall notify their decision in
writing within a period specified in national legislation.  Where the decision is adverse to the person
concerned, the reasons shall be given and the right of appeal advised.
9.9. Standard
The Customs shall issue binding rulings at the request of the interested person, provided that
the Customs have all the information they deem necessary.G/C/W/392
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Annex II
CHAPTER 10
APPEALS IN CUSTOMS MATTERS
A. RIGHT OF APPEAL
10.1. Standard
National legislation shall provide for a right of appeal in Customs matters.
10.2. Standard
Any person who is directly affected by a decision or omission of the Customs shall have a
right of appeal.
10.3. Standard
The person directly affected by a decision or omission of the Customs shall be given, after
having made a request to the Customs, the reasons for such decision or omission within a period
specified in national legislation.  This may or may not result in an appeal.
10.4. Standard
National legislation shall provide for the right of an initial appeal to the Customs.
10.5. Standard
Where an appeal to the  Customs is dismissed, the appellant shall have the right of a further
appeal to an authority independent of the Customs administration.
10.6. Standard
In the final instance, the appellant shall have the right of appeal to a judicial authority.
B. FORM AND GROUNDS OF APPEAL
10.7. Standard
An appeal shall be lodged in writing and shall state the grounds on which it is being made.
10.8. Standard
A time limit shall be fixed for the lodgement of an appeal against a decision of the Customs
and it shall be such as to allow the appellant sufficient time to study the contested decision and toprepare an appeal.G/C/W/392
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10.9. Standard
Where an appeal is to the Customs they shall not, as a matter of course, require that any
supporting evidence be lodged together with the appeal but shall, in appropriate circumstances, allow
a reasonable time for the lodgement of such evidence.
C. CONSIDERATION OF APPEAL
10.10. Standard
The Customs shall give its ruling upon an appeal and written notice thereof to the appellant as
soon as possible.
10.11. Standard
Where an appeal to the Customs is dismissed, the Customs shall set out the reasons therefor in
writing and shall advise the appellant of his right to lodge any further appeal with an administrative or
independent authority and of any time limit for the lodgement of such appeal.
10.12. Standard
Where an appeal is allowed, the Customs shall put their decision or the ruling of the
independent or judicial authority into effect as soon as possible, except in cases where the Customs
appeal against the ruling.
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