RESTRICTEDWORLD TRADE
ORGANIZATIONWT/REG/M/27
4 January 2001
(01-0026)
Committee on Regional Trade Agreements
Twenty-Seventh Session
NOTE ON THE MEETINGS OF 12-13 OCTOBER AND 17 NOVEMBER 2000
Chairman: Mr. E. T. Custodio (Philippines)
A. A DOPTION OF THE AGENDA
1. The Twenty-Seventh Session of the Committee on Regional Trade Agreements (CRTA) was
convened in Airgram WTO/AIR/1389 and Corrige ndum 1, dated 22 September and 17 October 2000,
respectively.
2. The following Agenda was adopted:
A. Adoption of the Agenda
B. Systemic Implications of Regional Trad e Agreements for the Multilateral Trading
System and Relationship between them
C. Reporting on the Operation of Agreements
D. Examination of Regional Trade Agreements
I. Customs Union between Turkey and the European Communities
II. Free Trade Agreement between the Former Yugoslav Republic of Macedonia
and Slovenia
III. Free Trade Agreement between Hungary and Lithuania 
IV. Free Trade Agreement between Hungary and Latvia
V. Accession of the Kyrgyz Republic to the Customs Union between the
Russian Federation, Belarus and Kazakhstan
VI. Free Trade Agreement between the Kyrgyz Republic and the Russian
Federation
VII. Free Trade Agreement between the Kyrgyz Republic and Ukraine
VIII. Free Trade Agreement between the Kyrgyz Republic and Uzbekistan
IX. Free Trade Agreement between the Kyrgyz Republic and Moldova
X. Free Trade Agreement between the Kyrgyz Republic and Kazakhstan
XI. Free Trade Agreement between Azerbaijan, Armenia, Belarus, Georgia,
Moldova, Kazakhstan, the Russian Federation, Ukraine, Uzbekistan,
Tajikistan, and the Kyrgyz Republic
XII. Draft Reports on the Examination of Regional Trade Agreements
E. Annual Report to the General Council
F. Other Business
3. The Chairman said that the Committee was aware that the Latin American Integration
Association (LAIA) had been granted observer status to the CRTA on an ad hoc  basis.  It was agreed
to extend an invitation to LAIA to attend the Committee's next meeting.WT/REG/M/27
Page 2
B. SYSTEMIC IMPLICATIONS OF REGIONAL TRADE AGREEMENTS FOR THE MULTILATERAL
TRADING SYSTEM AND RELATIONSHIP BETWEEN THEM
4. A representative of the Secretariat said that the objective of the presentation of the
Secretariat's Mapping paper was to give Members a foretaste of the paper (WT/REG/W/41), which
would be circulated the following week.  He recalled that during the Eighteenth Session of the CRTA
in July 1998, the Committee had asked the Secretariat to provide details, where publicly available, of
all regional trade agreements (RTAs) so that the Committee could assess the complete picture of all
RTAs in force and under negotiation.  In November 1998, the Secretariat had circulated an informal
document which had provided a historical view of RTAs in force up till that time.  The new document
brought the situation up-to-date and looked a little way into the future.  Included in the document
were all RTAs known to the Secretariat, in force as of 31 July 2000, as well as those expected to be inforce by 2005.  Consistent with its mandate, no distinction had been made between notified and non-
notified RTAs.   The maps presented were without prejudice to the status of any RTA in the WTO.
The Secretariat had used a strict definition for the inclusion of RTAs in the study: free-trade areas and
customs unions, classically defined, which covered reciprocal preferences on a large spectrum of the
parties' trade in goods were included; asymmetrical agreements, in which one party liberalized faster(or slower) than the other(s) were included, but non-reciprocal preferential agreements were not.
Thus, for instance, the Cotonou Convention and the Caribbean Basin Initiative were not included, nor
were partial agreements or framework agreements, such as the LAIA Agreement.  APEC had not been
included as it was not an FTA in the classic sense.  The overall conclusion that could be drawn from
the paper was that the number of RTAs was large and growing.  A total of 172 RTAs had beenidentified as being in force as of the end of July 2000, with a further 70 under negotiation.  The next
five years might bring a certain consolidation of the process with events like the enlargement of the
European Union and the entry into force of the Free Trade Area of the Americas.  The paper did not
look at the structure of individual agreements, or at the rules applied by them, or at the volume of
trade flows within or between RTAs.  Rather, the emphasis was on the pattern of RTAs in force atpresent and expected to be in force by 2005.  The density maps showed sets of countries which were
involved in no RTAs, 1-3 RTAs, 4-7 RTAs, 8-12 RTAs, 13-18 RTAs and 19-28 RTAs, all of which
were designated by different colours.  In the map of 2000, the European Communities was involved in
the largest number of RTAs.  In most other parts of the world the concentration of RTAs was less,
mostly in the range of 1-7 RTAs, with some except ions in the European and Scandinavian areas.  By
2005, the European countries would still have the greatest density of RTAs, but the density of RTAs
in the Americas, the countries of the former Soviet Union and in Asia Pacific would increase,compared to 2000.  These changes would be shown on individual regional maps.
5. A representative of the Secretariat continued, describing the networks of RTAs in force
between the European Communities (EC) and European Free Trade Association (EFTA) with other
countries in the Euro-Mediterranean region as of July 2000.  She noted that the EC and EFTA
networks of RTAs stretched from Estonia, the northernmost of the three Baltic countries, roundthrough Central Europe, Turkey, Israel and along th e coast of North Africa to Morocco.  Also shown
on the map were the bilateral agreements between the EC and individual EFTA countries and the
Faroe Islands, and between the Faroe Islands and individual EFTA countries.  Although the networks
of RTAs between the EC and EFTA with third countries were similar, they were not identical.  For
example, Tunisia, Jordan, Cyprus, Andorra, Malta and San Marino currently had RTAs with the EC,but not with EFTA. By 2005, six new countries - Estonia, Poland, the Czech Republic, Hungary,
Slovenia and Cyprus - were expected to join th e EC.  Meanwhile, the EC and EFTA networks were
expected to expand.  It was expected that EFTA would conclude RTAs with Malta, Tunisia, Jordan,
Lebanon, Egypt, Albania, and the Former Yugosl av Republic of Macedonia by 2005, while the EC
was expected to extend its network to include Alge ria, Lebanon, Egypt and Syria.  Both the EC and
EFTA were expected to sign an RTA with the six countries of the Gulf  Cooperation Council (GCC).
Yet, by 2005 some differences between the EC a nd EFTA networks would remain: for instance,WT/REG/M/27
Page 3
Algeria and Syria would have RTAs with the EC onl y, while EFTA only was expected to have RTAs
with Albania and the Former Yugoslav Republic of Macedonia.  This was the situation as it stood at
present, but it was quite possible that it would chan ge.  The next map showed the network of RTAs in
force in July 2000 in Central Europe, the three Baltic countries and certain countries of the Middle
East.  There were two plurilateral RTAs in this sub-region: the Central European Free TradeAgreement (CEFTA) with seven members, and the Baltic Free Trade Area with three.  Two CEFTA
countries, the Czech and Slovak Republics, were joined by a customs union.  There was also a large
number of bilateral agreements in force between individual CEFTA countries, the three Baltic
countries, Turkey and Israel.  Yet, while this ne twork of agreements between the CEFTA countries
and third parties was quite far-reaching, it was not symmetrical.  For example, the Czech Republic,
the Slovak Republic, Hungary, and Slovenia all had RTAs with the three Baltic states, Poland
currently had RTAs with Latvia and Lithuania onl y, while Romania and Bulgaria had none. By 2005,
assuming that the six countries mentioned earlier had joined the EC, CEFTA would lose four of its
current seven members, while the Baltic Free Trade Area would be left with two of its current three.
A second change expected by 2005 was that the number of bilateral RTAs in force between the
CEFTA countries and Turkey and Israel would be considerably reduced, as the six acceding countries
to the EC would take on the EC's  network of RTAs, which would supersede their own networks of
RTAs.  Hence the consolidation mentioned earlier was very much evident in this sub-region.  The
next map showed the network of RTAs in force between the North African countries and the Middle
East.  Three plurilateral RTAs were in force in this sub-region: the Arab Maghreb Union (AMU) with
five members; the Gulf Cooperation Council (GCC) with six; and the 18-member Arab Free Trade
Area (AFTA), which united four of the five member s of the AMU, the six members of the GCC, and
eight other countries.  Also in force were bilateral agreements between Morocco and Tunisia, Turkey
and Israel, and Morocco and Israel.  By 2005, a number of bilateral RTAs, currently under
negotiation, were expected to be in force, e.g. between Morocco and Turkey, Tunisia and Turkey, and
Turkey and Egypt.  The next map which showed the African continent was the most colourful, which
was a reflection of the large number of plurilateral RTAs currently in force in Africa: thirteen as ofJuly 2000.  This situation was not expected to change much by 2005 as few new initiatives were
expected in Africa in the next five years.  The two plurilateral RTAs in North Africa, the AMU and
AFTA, had already been mentioned.  In West Africa, there were three plurilateral RTAs: the Mano
River Union (MRU) with three members; the eight-member West African Economic and Monetary
Union (WAEMU); and the 16-member Economic Co mmunity of West African States (ECOWAS),
which united the MRU, the WAEMU and five other West African countries.  In Central Africa, there
were two plurilateral agreements: the Central African Economic and Monetary Union (CEMAC) with
six members; and the wider-reaching Economic Community of Central African states (ECCAS)
which united the six members of CEMAC with five other countries.  In Southern Africa, there were
two plurilateral RTAs: the Southern African Cu stoms Union (SACU), and the 14-member Southern
African Development Community (SADC).  In East Africa there was the three-member East African
Community (EAC) and the 14-member Cross Border Initiative (CBI) which stretched across Easternand Southern Africa. COMESA which stretched from Egypt in the north, through Eastern and
Southern Africa, currently had twenty members.  Lastly, all African countries except Morocco were
members of the African Economic Community (AEC).
6. A representative of the Secretariat continued, showing a map of the Asian Pacific region valid
for July 2000.  There were three main RTAs in Asia Pacific: the SAARC preferential trading area
with seven members; the 10-member ASEAN Free Trade Area, expected to be completely in force by
2002; and the Closer Economic Relations (CER) Ag reement between Australia and New Zealand.  In
addition to the plurilateral agreements, a number of bilateral agreements were in force in this region,
for example, between India and Sri Lanka, India and Bhutan, and between Australia and Papua New
Guinea.  Although these RTAs covered a significant number of countries in the region, some of thetrading economies of the region such as China; Korea; Japan; and Hong Kong, China were currently
not party to any bilateral RTAs.  By 2005, a number of new RTAs were expected to come into force,
while some possible consolidation among existing RTAs should take place.  Negotiations wereWT/REG/M/27
Page 4
underway for an FTA between the CER countries an d ASEAN.  At the same time, members of the
South Pacific Forum, which included 14 Pacific islands, Australia and New Zealand, were
considering the conclusion of a regional trade agreement (PARTA).  Apart from these developments,
other countries, such as Japan, Korea and Singapore were considering signing bilateral trade
agreements both with countries in the region and cross-regionally, particularly with the Americas.The next map showed the Americas where five plurilateral agreements were currently in force: the
NAFTA with three members; the CACM and th e Andean Community both with five members;
MERCOSUR which currently had four members; and the Caribbean Community (CARICOM) with
15.  Almost all countries in the region except Cuba, Chile, the Dominican Republic and Panama were
currently members of one of the five plurilateral agreements.  In addition, a number of bilateral
agreements were in force, for example, between Chile and Canada, CARICOM and the Dominican
Republic, CACM and the Dominican Republic.  By 2005, some changes were expected.  On the one
hand, almost 20 more RTAs were likely to have been concluded which might at first seem to increase
the complexity of the network of RTAs in the region, but in fact, this busy phase was likely to lead to
a partial consolidation in the region, whereby some of the above-mentioned five main RTAs would
conclude FTAs either with each other or with individual countries.  For example, the map for 2000
showed that the Andean Community had RTAs with Brazil and Argentina, but by 2005 the AndeanCommunity was likely to conclude an RTA with MERCOSUR which would supersede the two
agreements that the Andean Community had with in dividual countries.  There was also the likelihood
that Chile would join MERCOSUR, but it was uncl ear how Chile's existing agreements, for example
with the Andean countries, might be modified or superseded through such membership.  Chile had
three agreements currently and it would most likely join the MERCOSUR-Andean Community RTA.
Mexico had RTAs with a few of the CACM member s and by 2005 it was expected that Mexico would
have an RTA with the CACM itself.  Apart from regional initiatives, it was also likely that there
would be some cross-regional agreements involvin g countries from this region.  An alternative
scenario might occur after the entry into force of the Free Trade Area of the Americas, but it was not
yet clear what impact such an arrangement would have on existing plurilateral and bilateralagreements.  The last two maps showed the cross-regional agreements for 2000 and 2005.  In 2000,
the main cross-regional agreements were trans-Atlantic, for example, EC-Mexico and the bilateral
FTAs between Israel and the US, Canada and Mexico, respectively.  By 2005, there should be more
bilateral and plurilateral RTAs, sometimes involving two RTAs, for example, EC-MERCOSUR,
SACU-MERCOSUR.  Countries from the Americas were also likely to conclude agreements with
Asian Pacific countries.
7. A representative of the Secretariat said that he hoped that the presentation had given Members
a foretaste of the paper which would be circulated the following week.  Although his colleagues had
made a great effort to collect information on existing agreements, it was possible that some had been
omitted or mis-described.  He hoped that the paper, which would be printed in colour, would provide
valuable information for Members and for general consumption. Once it had been distributed,
comments from Members would be welcome on its contents, in view of the complexity of thesituation.  With the approval of the Committee, the Secretariat would like, eventually, to put it out for
general consumption on the WTO website.
8. A representative of the Secretariat reported on the progress made on the horizontal studies.
She recalled that the Committee had asked the Secretariat to begin work on thematic surveys of RTA
provisions which were to be based on available information with the purpose of providing theCommittee with basic material for a detailed horizontal exploration of the treatment of various policy
provisions or measures in RTAs.  The aim was to enable the Committee to identify patterns and,
where appropriate, to compare RTA provisions across the RTA universe vis-à-vis  the relevant
multilateral disciplines.  The first thematic survey that the Secretariat had been asked to prepare
referred to product coverage and liberalization processes, rules of origin régimes and denial of benefitrules.  The first step was to develop basic parameters, not only for this study, but for future horizontal
studies.  The surveys would be based on about 100 RTAs, for which information was sufficientlyWT/REG/M/27
Page 5
detailed to allow a reasonable level of horizontal comparison.  Only relatively comprehensive trade
agreements with mutual tariff concessions and some trade policy rules had been selected for the study.
The second parameter was that all instruments which accompanied the RTA, such as protocols or
bilateral agricultural arrangements (in the case of EFTA's agreements) had been treated as a single
RTA, so as to cover a range of provisions to allow horizontal comparison.  The third parameter wasthat, as far as possible, the most updated information supplied to Secretariat or in the public domain
had been used.  Nonetheless, the surveys might not yield the most up-to-date picture of the different
RTAs, given that changes over time had not always been fully or consistently documented within the
GATT or the WTO.  The recent biennial reports which had been received on the operation of RTAs
had helped enormously, but there were other cases where the Secretariat had had to resort to the
public domain, e.g. the internet, which was more up-to-date than the Secretariat's own files.  Public
information would be used to the extent necessary to update information missing from theSecretariat's files.  Under product coverage and the liberalization process, which was one part of the
first horizontal study to be circulated, the determination of RTA coverage might be controversial,
especially given the wide range of possible definitions of coverage, not only those of a legal nature.
Even when the definition for RTA coverage was chosen for analytical reasons, giving an account of it
remained a difficult task, in part because most RTAs offered a convoluted presentation of coverageand scope in their texts: even the most straightforward were still difficult to follow.  On top of this a
number of problems had to be solved concerning the choice of the measurement tool for describing
which products were covered and which were excluded for a given RTA.  Once the analytical
difficulties had been identified, the parameters could be set and it was a mechanical exercise to go
through each RTA.
9. A representative of the Secretariat reported on work done on rules of origin in the goods area.
For a majority of RTAs, the formal information on rules of origin which was available in the
Secretariat was outdated and it had taken a considerable amount of time to search for the most recent
information.  The internet had been the best source for the most recent protocols signed on rules of
origin.  The survey on rules of origin would begin with a brief introduction of the methods forconferring origin.  Normally rules of origin were conferred in the country where the last substantial
transformation occurred, either on the basis of a value-added test, a change in tariff nomenclature or a
technical test.  Secondly, the analysis of each agreement would attempt to reply to the following
questions.  What was the general method used for conferring origin?  If a value-added criterion was
chosen, what was the required percentage for domestic or imported products?  Did the agreement
provide for a tolerance rule, either general or sector-specific?  Did the rules of origin provide for
bilateral, diagonal or full cumulation?  In this, th e study would aim at clarifying how distinct régimes
applied.  Generally, whenever there was cumulation, certain rules or a certain processing were
required within the cumulation area, but other, more important processing was required if the input
was not originating.  Were the cumulation rules reciprocal?  Cumulation could apply only to one
party, but not to others.  If the agreement provid ed for diagonal cumulation, how was the origin of the
product determined, namely which was the country which would provide the origin?  This wasimportant, for example, for the application of anti -dumping duties.  Were there exceptions to the
general rule or criterion, and if so, were they product specific?  Was there any reasoning for the
exceptions to the general rules of origin, and on which criteria were those exceptions based (e.g. a
value-added test, technical test or change in tariff nomenclature)?  Did the RTA provide for the
drawback of tariffs paid on non-originating products that were incorporated in a final product which
had acquired originating status?  Finally, what did the rules on territoriality and transport provide for?
For example, was it possible for an originating product to be subject to any processing outside the
territory of the member countries without losing its originating status?  She added that the format for
the presentation of information had yet to be decided.
10. The Chairman said that the horizontal surveys together with the Mapping paper should
provide a fairly comprehensive view of developments, both substantive and physical, as far asWT/REG/M/27
Page 6
regional trade agreements were concerned.  He welcomed any inputs into the Secretariat's horizontal
comparative study.
C. REPORTING ON THE OPERATION OF AGREEMENTS
11. The Chairman recalled that the 1999 Schedule for the Submission of Biennial Reports, the
first since the establishment of the WTO, included 24 RTAs notified under Article XXIV which were
still in force and on which an examination report had been adopted by the GATT Contracting Parties.
As of this date the Committee had received 21 of th ese 24 biennial reports: 20 of those reports had
been reviewed during the Committee's Twenty-Sixth  Session in July and questions had been posed
orally in relation to five agreements, namely EC-Switzerland, EC-Iceland, EC-Malta, EC-Cyprus and
EC-Egypt;  deadlines had been set for the submission of written comments or questions and replies,
but up to that point, no new questions or replies had been received.  In the meantime the Secretariat
had received the biennial report of the Austra lia-New Zealand CER Agreement which would be made
available to delegations under document WT/REG111/R/B/1. He reminded the Committee that the
biennial reports for the United States-Israel , Australia-Papua New Guinea, and EC-Norway
agreements had not yet been received, although their submission had been due in the course of 1999.
Another outstanding question in this context was the schedule for the submission of biennial reports
for 2001.  At the last Session of the Committee this question had been addressed briefly anddelegations had been asked to provide their views, but few comments had been received so far.  This
was a responsibility which had been entrusted to the Committee but which required further thought.
He was in a quandary for two reasons.  First, how could the debate on the biennial reports for 1999 be
continued given that there were still some pending questions on five reports, that no discussion had
yet taken place on the biennial report of the CER agreement, and that the reports on three otheragreements had not been submitted?  Second, how could a schedule for the submission of biennial
reports for 2001 be drafted?  He did not expect a reaction at that point, but asked that delegations
provide comments, so that the issue could be addressed.
12. The representative of the European Communities sa id that he had with him the responses to a
number of questions which had been posed during the last meeting on the five biennial reports to
which the EC was party.  The Chairman said that the replies provided by the EC would be circulated
after the meeting.
13. Reverting to the schedule for biennial reports in 2001, the Chairman explained that when the
schedule for biennial reports for 1999 had been discussed in the CRTA, the Committee had been
confident that some kind of breakthrough would be made on the examination front which would
enable the biennial report process to run smoothly as a periodic transparency tool.  More than two
years had elapsed since then, but the Committee had not yet released any report on the examination ofagreements, some of which had been in force for several years.  As a consequence, formal information
on the operation of these RTAs had ceased to flow among Members, which undercut the transparency
principle on which the biennial reporting mechanism was based.
14. The representative of Australia acknowledged the difficulty of the situation, given the link to
the backlog of examination reports.  The Committee should take the reporting requirement seriously
and delegations should have the opportunity to raise questions on biennial reports during formal
meetings so that positive precedents could be highlighted, suggestions could be made, and problems
discussed.  In terms of the schedule for the following year, his view was that there was merit in
continuing to request biennial reports on the operation of agreements as they fell due as this process
contributed to transparency.  He added that priority should be accorded on the agenda of the CRTA tothose agreements for which biennial reports had not  been submitted previously.  The representatives
of the European Communities and the Czech Republic
 concurred.WT/REG/M/27
Page 7
15. The representative of Uruguay said that his delegation had no objection to the Committee's
continuing to request biennial reports, but in view of the fact that in the majority of cases the
examination reports had not yet been concluded, he wondered how useful it would be.  He agreed that
biennial reports contributed to transparency, but was against just adding the reports to the list of items
to be considered.  The Chairman pointed out that examination reports were independent from the
biennial reporting process.
D. EXAMINATION OF REGIONAL TRADE AGREEMENTS
16. The Chairman began by providing a follow up on the ten agreements examined during the
Committee's last Session in July.  The factual examination of four of these agreements had been
completed and the Committee had instructed the Secretariat to begin drafting the examination reports.
One of these was the FTA between Estonia, Latvia and Lithuania.  A fax sent by the Chairman on 15
September had invited Members to transmit any factual comments on this draft examination report tothe Secretariat by 25 September.  Given that none had been received thus far, he asked delegations to
submit any comments on this draft examination report by 31 October.  He added that written
questions had been received on two of the ten agreements examined in July, namely the FTAs
between Slovenia and the Former Yugoslav Republic of Macedonia, and between Poland and Latvia;
these questions had been transmitted to the parties.  For the remaining four agreements, the deadlinefor the submission of questions had been either 21 July or 13 September, but no written questions had
been received.  In the case of the EFTA-Morocco FTA, the minutes of the examination clearly
indicated at least two outstanding questions.  In the absence of further questions, he asked the Parties
to this agreement to submit replies to the Secretariat as soon as possible and to plan for a second
round of examination at the Committee's next Session early in 2001.  For the agreements between EC-Tunisia, Turkey-Bulgaria, and Bulgaria-Former Yugoslav Republic of Macedonia, the situation was
different.   Given that no replies were pending and that no further questions had been submitted by the
deadline set in July, he wondered if the factual examination of these agreements was complete and the
Secretariat could now draft the relevant examination reports.
17. Since the representative of the United States requested more time for the submission of
questions on these agreements, the Chairman suggested a new deadline of 10 November for the
submission of further questions.  If no questions had been received by then on a given agreement, this
would indicate that the factual examination was complete and the Secretariat could begin drafting the
relevant examination report.  If questions were received, the parties' replies should reach the
Secretariat no later than 20 December to enable the scheduling of a new round of examination for
early 2001.
18. When the Session resumed, on 17 November, the representative of Bulgaria pointed out that
the deadlines had lapsed for the submission of questions relating to two RTAs to which his country
was a party. It was his understanding that if no additional questions had been received by the deadline,
the Secretariat would be instructed to draft the examination reports for these agreements and he asked
if this was the case.  The Chairman said that since no new questions had been received, the Secretariat
was now charged with the drafting of the examination reports for these two agreements and that
Attachment II of the Annual Report would be modified to contain the corresponding change in the
status of these agreements.
19. (The minutes of the examination of the Agreements listed under agenda items D.I-XI are
being distributed as separate documents.)
D.XII Draft Reports on the Examination of Regional Trade Agreements
20. The Chairman reminded the Committee that he had sent a fax on 15 September in which he
had stated his intention of putting the draft reports of the examinations of the ANZCERTA (Services),WT/REG/M/27
Page 8
NAFTA (Goods and Services) and EFTA-Hungary agreements before the Committee on his own
initiative. He reminded the Committee that the examination of the NAFTA Agreement had begun in
1995, while the examinations of the EFTA-Hungary Agreement and ANZCERTA had begun in 1997.
Since then, Members had had the opportunity to hold extensive informal discussions on the
finalization of these reports.  From his point of vi ew, the draft reports reflected the varying views and
observations relevant to the provisions of GATT 1994 and GATS Article V, under which the
examinations had been mandated and conducted.  These draft reports needed to be considered for
endorsement by the Committee and transmitted to the relevant Councils, so that any fundamental
issues could be noted by the respective Councils and appropriately addressed.  This would enable the
Committee to break the impasse on the remaining 57 examination reports which were in various
stages of preparation. By the following year he hoped to restore the Committee to its normal work
programme.  On 28 September, the respective working documents had been distributed, again underhis own responsibility. The consideration of this item had been postponed from 13 October until this
meeting specifically to allow time for more in-depth consultations among delegations with a view to
narrowing the differences between them and to look at the systemic considerations, if the Committee
was unable to move forward.  More generally, there was a need to devise ways and means to permit
the Committee to fulfill its examination mandate, a responsibility which had been paralyzed since itscreation. His objective was to identify the difficulties encountered in the finalization of examination
reports, and the possible alternatives available, if the examination reports could not be agreed.  He had
been informed by delegations that the avenues for agreement were indeed limited and that despite
strenuous efforts, it might not be possible to move forward.  He hoped that delegations' views had
crystallized, and that they could approach objectively the predicament in which the Committee nowfound itself.  In the meantime he had circulated some specific and focused questions to enable the
Committee to reflect more clearly and in an unbiased manner on the issue of examination reports. His
impression was that the Committee had progressed in its task of the examination of agreements during
the current year by (a) using a simplified and standard examination report focusing on specific
elements of the examination mandate;  (b) recognizin g the individual merits of each specific RTA and
avoiding the possibility of linkages;  and (c) the tacit understanding of allowing the endorsement of
examination reports with split conclusions. With this in mind, he suggested that the Committee move
to informal mode in order to allow an exchange  of views.  Based on the informal exchange, the
Chairman said that he would attempt to summarize delegations' views in his statement to the General
Council.
E. A
NNUAL REPORT TO THE GENERAL COUNCIL
21. The Chairman said that a draft of the CRTA's Annual Report to the General Council had been
circulated, which reflected in a broad way, in paragraphs 8 and 17, the tenor of the Committee's
informal discussions. In the second to last sentence of paragraph 8 beginning "In September, the
Chairman submitted for the consideration of the Committee at its Twenty-Seventh Session a number
of draft reports on which extensive consultations had been held in the past years and which were at an
advanced stage of elaboration", a suggestion had been made to insert the word "also" between"which" and "were".  He added that Attachment II entitled "List of RTAs under Examination" had
been restructured.  The subheadings now read "RTAs for which factual examination had been
completed and the draft examination reports are in various stages of consultation and finalization",
and "RTAs for which factual examination has not ye t commenced".  The latter category now included
seven RTAs with the addition of EC-Israel and EC-Morocco.
22. The representative of the Czech Republic supported the minor drafting changes proposed by
the Chairman which he said represented a significant improvement of WT/REG/W/40.
23. The representative of Argentina supported the proposed text, but proposed that the last four
words of paragraph 17 be deleted and replaced with "continued and will continue on these issues."
This would reflect the fact that the Committee was able to continue working on the idea, as he was notWT/REG/M/27
Page 9
convinced that at this stage it was in a position to set a priority.  As regards paragraph 18, he asked for
clarification of what was meant by "new direction".  If he translated this into Spanish, he would read it
as saying that the Committee was changing its focus or direction, but he did not think that this was
what the Committee had in mind.  Rather, the Committee had new inputs for its discussion.  He
wondered if "new inputs" might be more appropriat e than "new direction", but asked the Chairman to
indicate whether his understanding was correct.
24. With regard to paragraph 18, the representative of Australia agreed with the previous
suggestion of clarifying what was meant by "new di rection".  In addition, he wondered whether the
sentence which had been struck out could be reintroduced.  It was a fact that the Committee was not
in a position to make recommendations to the General Council under Item 1(d) of its Terms of
Reference.  The text could continue with "although" and have the phrase which was in there now, or
with some clarification of what was meant by "new direction".
25. The representative of the European Communities said that her delegation was happy with the
text as it stood and with the proposed changes.  The sentence as it presently stood in paragraph 18 was
sufficient without reverting to earlier language.
26. In reference to the proposal made by the representative of Argentina on paragraph 17, the
Chairman said that the outcome of the discussions had been that some formal priority be given to the
Committee's work on the technical and broader obstacles to the examination process. Depending on
the will of the majority of Members, he was inclined  to retain the word "priority" rather than "focus",
as it appeared to be more appropriate.  Paragraph 18, which stated that "Members had exchanged
ideas to clarify these issues and provide options to move the process forward on a priority basis" was
a summary of paragraph 15 which made reference to the document circulated by the Chairmanentitled "Further Work on Systemic Issues".  With the help of the Secretariat, work had begun on the
horizontal studies on the treatment of various policy provisions or measures in RTAs, the first of
which would address internal trade liberalization in RTAs.  This was not a recommendation which
would alter the Committee's terms of reference un der 1(d), but would give more impetus to its
systemic work.
27. On the issue of priorities, the representative of the United States said that in paragraph 8 the
finalization of reports had been identified as a priority, whereas paragraph 17 referred to focusing on
the  "technical and broader obstacles to progress" as a priority.  She could see that it might be a
problem to refer to a first priority if it was not clear what it was.  Paragraph 17 had a different
structure than earlier and she wondered if this would commit the Committee to focusing as a first
priority on some kind of broader issues that it was not aware of.
28.  The Chairman asked if any delegation could propose alternative wording for this.  As noted
in paragraph 8, the Committee had discussed the technical and broader obstacles to progress.  There
was already reference to the fact that the Committee "would focus on these issues" as its priority.  He
suggested that this could be changed to "on a priority basis".
29. The representative of Switzerland, speaking on behalf of the EFTA states, supported this last
proposal and said that the EFTA countries could go along with the rest of the text as it now stood.
30. The representative of New Zealand said that his delegation had no difficulty in accepting "on
a priority basis".  But getting back to the point made by the delegation of the United States, he said
that from his point of view, the terminology used in paragraph 8 was more accurate as it referred to
"practical difficulties and broader issues": in paragraph 17, the text referred to "technical and broader
obstacles", which seemed to indicate something diff erent.  His proposal was that the term "practical
difficulties and broader issues" from paragraph 8 be used in paragraph 17 and that the sentence end
with "on a priority basis", as in paragraph 8, to  avoid confusion between the two paragraphs.  TheWT/REG/M/27
Page 10
representative of Hungary supported those amendments. The representative of Argentina  accepted
New Zealand's proposal and agreed that it was bett er to use the same words in order to avoid
confusion.  His delegation could also accept "on a priority basis", whilst keeping in mind that this was
not the only priority.  The Chairman said that "on a priority basis" would be added to paragraph 17
and that the word "technical" would be replaced with "practical".
31. Reverting to paragraph 18, the Chairman asked for confirmation that Argentina's proposal
was that "new input" replace "new direction" in relation to the Committee's work.  The representative
of Argentina responded that he had asked what was m eant by "new direction", it being his delegation's
intention to ask that "direction" be replaced with "input", but given that the discussion had made it
clear that the Committee was looking at a new focus, he had no objection to the text as it now stood.
The representative of Australia withdrew his proposal to reintroduce the first sentence, given the EC's
opposition to it.
32. The Committee adopted the Annual Report.
F. OTHER BUSINESS
33. Under Other Business, the Chairman proposed the following dates for CRTA's meetings in
2001: 22-23 February, 2-3 July and 22-23 October.
34. The Committee took note of the comments made.
__________