. /.WORLD TRADE
ORGANIZATIONWT/REG116/4/Add.1
11 July 2002
(02-3875)
Committee on Regional Trade Agreements Original:  English
FREE TRADE AGREEMENT BETWEEN TURKEY AND LATVIA
Questions and Replies
Addendum
II. TRADE PROVISIONS
3. Rules of Origin
Would the Parties explain the “necessary procedure” for cumulation in detail?
What is the rationale on extended cumulation  of products originating from non-Parties
to this Agreement?
These two questions should be considered together as the term "necessary procedure" in the
standard format refers to the diagonal cumulation. The detailed diagonal cumulation procedure has
been set out in the Articles 4.2 and 4.3 of the Protocol C annexed to the FTA between Latvia andTurkey. As stated in the footnote 1 of the WTO document WT/REG116/1 regarding the Agreement,
the Annexes and Protocols have been submitted to the Secretariat for consultation by interested
Members (Office1174).
In terms of cumulation of products, this Agreement is deemed to be a part of the Pan-
European Cumulation System which is based on harmonization of rules of origin applied in
preferential trade between the Community, the Ce ntral and East European Countries (CEEC), the
EFTA countries and Turkey. After signed all the agreements with the CEEC and EFTA countries,
Turkey has also entitled to take part in the Pan-European Cumulation System as of January 1, 1999.
Article 4.1 of the Agreement specifically refer to the participating countries of the said System.
Additionally, the details of this System can be found in the WTO document WT/REG/GEN/1.
Therefore, the term, non-Parties of the "extended cumulation", covers the Community, the
Central and East European Countries (CEEC) and the EFTA countries not a third party.
The system Pan-European cumulation of rules of origin created the concept of the “origin of
the area”. Under this concept the product origin ated in the area of Pan-European cumulation can
benefit from preferential trade rules within the whole area. This cumulation system of the rules of
origin significantly reduces trade barriers thus creating more favorable conditions for business,
economic operators and traders both within and outside the area of Pan-European cumulation.
5. Safeguards
The requirement under Article 18 (b) does not exist in the WTO Safeguard Agreement.
What is the rationale for introducing a new requirement for safeguard measures?  Which
factors will be taken into account in order to establish this requirement during the investigation
procedure?WT/REG116/4/Add.1
Page 2
Do the Parties consider that this require ment in the investigation procedure is
established in accordance with the WTO Safeguard Agreement? In which way?
Paragraph 6 of Article 21 of the Agreement allows the Party to apply the precautionary
measures without prior examination. Is it possib le to apply the precautionary measures if there
is merely the application of the domestic industry? What is the minimum standard or criteria
before precautionary measures are applied?
All FTAs signed by the Parties contain similar provisions referring to the use of safeguard
measures that are in conformity in substance with the WTO provisions.
Due to this very close relationship between the FTA and WTO rules, no separate track has
been created in the national legislation of the Pa rties in order to implement specific FTA provisions
concerning safeguards.
The Parties operate under Safeguard legislation, which is fully compatible with the WTO
rules and has been notified to the relevant Committee of WTO.
6. Anti-Dumping and Countervailing Measures
Paragraph 6 of Article 21 of this Agreement establishes the precautionary safeguard
measure in the case of anti-dumping und er Article 17. However, the WTO Anti-dumping
Agreement has no provision with regard to the above measure.  How do the Parties reconcile
this discrepancy in the investigation procedure?
All FTAs signed by the Parties contain similar provisions referring to the use of anti-dumping
measures that are in conformity in substance with the WTO provisions.
Due to this very close relationship between the FTA and WTO rules, no separate track has
been created in the national legislation of the Pa rties in order to implement specific FTA provisions
concerning anti-dumping.
The Parties operate under Anti-dumping legislation, which is fully compatible with the WTO
rules and has been notified to the relevant Committee of WTO.
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