RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/REG134/M/1 
28 April 2004 
 
 (04-1891) 
Committee on Regional Trade Agreements 
Thirty-Sixth Session  
 
 
 
EXAMINATION OF THE FREE TRADE AREA BETWEEN THE 
UNITED STATES AND JORDAN, GOODS AND SERVICES 
 
Note on the Meeting of 29 March 2004  
 
Chairman: Mr. R. Saborío (Costa Rica) 
  
1. The meeting was convened in document WTO/AIR/2276/Rev.1. 
2. Under Agenda Items C.IV of its Thirty-Sixth Session, the Committee on Regional Trade 
Agreements (hereinafter CRTA or  the Committee) took up the first round of examination of the goods 
and services aspects of the Free Trade Agreement ( FTA) between the United States and Jordan.  The 
following topics were discussed: 
 A. General Remarks  
 Goods Aspects 
 B. Section I – Background Information on the Agreement 
 C. Section II – Trade Provisions   D. Section III – General Provisions of the Agreement 
 Services Aspects 
 E. Section I – Background Information on the Agreement  F. Section II – Provisions Affecting Trade in Services 
 
3. The Chairman
 noted that it was the first round of examination of the goods and services 
aspects of the FTA between the United States and Jordan.  The Agreement had been signed on 24 
October 2000 and had entered into  force on 17 December 2001.  The goods aspects of the Agreement 
had been notified to the WTO in March 2002 (docum ent WT/REG134/N/1 and, in its English version 
only, Corrigendum 1) while the services aspects of the Agreement had been notified in October 2002 
(document S/C/N/193).  The text of the Agreement had been distributed in document WT/REG134/1.  
He proposed to organize the examination by first asking the Parties and other Members for general 
comments, both on the goods and services aspects of th e Agreement, and then to turn to the specifics, 
looking first at the goods aspects, followed by the services aspects, and using the Standard Formats, 
documents WT/REG134/3 and WT/REG134/4, respectively,  to guide the debate.  Before giving the 
floor to the Parties for their general statements, he recalled that the terms of reference for the 
examination of the goods aspects had been adopted  on 22 March 2002 by the Council for Trade in 
Goods as contained in document WT/REG134/2 and that the decision to refer the services aspects of the Agreement for examination in the CRTA had been taken on 25 October 2002 by the Council for 
Trade in Services, as contai ned in document S/C/M/63. 
A. G
ENERAL REMARKS  
4. The representative of the United States  stated that the Parties were pleased to present the 
United States-Jordan FTA and their economic partne rship.  The Agreement, signed in 2000, was the WT/REG134/M/1 
Page 2  
 
 product of extensive collaborati on in economic relations, and followed upon Jordan's 1999 accession 
to the WTO.  Through those endeavours, the United States had strongly supported Jordan's efforts to 
build its trade capacity.  Jordan's commitment to free trade and economic re form was producing many 
benefits.  While indicating that these would be discussed later in more detail by the Jordanian 
delegation, she noted that trade liberalization had le d to Jordan's exports to the United States growing 
from $16 million in 1998 to a projected $700 milli on in 2003.  The high standards of the United 
States-Jordan FTA built upon the two countries' commi tments under the WTO and  were indicative of 
their commitment to economic liberalization and openness. 
5. The representative of the United States noted that key provisions the Agreement included 
coverage of substantially all trade in industrial a nd agricultural products, and substantially all trade in 
services;  it incorporated TRIPS-consistent standard s for copyright protection; and it contained trade-
related environmental and labor provisions.  The FTA also achieved significant and extensive 
liberalization across a wide spectrum of trade issues.  Tariffs on virtually all bilateral trade in agricultural and industrial goods would be eliminat ed within 10 years, starting from 2001.  Measured 
in terms of either total bilateral trade in 2000 a nd 2001 or in terms of total tariff lines subject to 
elimination, the Agreement would eliminate all ta riff and non-tariff barriers on over 99 per cent of 
total trade in industrial and agricultural products.  Tariff reductions would take place in four stages:  
tariffs of less than 5 per cent ad valorem  at the time of implementation were phased out in a two-year 
period, over the years 2001 to 2003; those that were  between 5 and 10 per cent would be eliminated in 
four years from implementation; tariffs between 10 and 20 per cent would be eliminated over five 
years; and those that were more than 20 per cent would be phased out over 10 years.  On rules of 
origin, the Agreement provided for a general test of substantial transformation, along with a 35 per 
cent rule for the value of regional content; with respect to textiles, the rules of origin were the same as 
those used by the United States fo r everyday trade in textiles. 
6. The representative of the United States continued saying that the FTA had substantial services 
sectoral coverage and provided for the absence or elim ination of substantially all discrimination.  A 
positive list approach was used, that is sectors not  included in each Member's Schedule of Specific 
Commitments were not covered by the Agreement.   The Schedules of Commitments encompassed the 
same four modes of delivery for services which were included in the WTO General Agreement on 
Trade in Services (GATS):  cross-border supply,  consumption abroad, commercial presence, and 
presence of natural persons.  Under the Agreement,  Jordan had committed to open its services market 
across a range of sectors beyond those that it had included in its commitments under the GATS, as 
described in the Standard Format.  The Agreement directly incorpor ated two key provisions of the 
GATS – requirements to accord "market access" (GATS Article XVI) and "national treatment" (GATS Article XVII) – and made them applicable to bilateral services trade.  Other provisions of the 
GATS, such as its telecommunications and financia l services annexes and Articles related to domestic 
regulations, monopolies and exclusive suppliers, a nd general exceptions, were included within the 
FTA to the extent necessary to apply and interpre t each party's national treatment and market access 
commitments in the same manner as under the GATS.  The FTA intellectual property rights 
provisions incorporated the most up-to-date interna tional standards for copyright protection, building 
on Jordan's strong commitments.  The FTA also provided for each Party to implement fully the World Intellectual Property Organization (WIPO) Co pyright Treaty and the WIPO Performances and 
Phonograms Treaty.  The FTA also included, for the fi rst time ever in a trade agreement, substantive 
provisions addressing electronic commerce.  Jordan and the United States each committed to promote 
a liberalized trade environment for electronic co mmerce that should encour age investment in new 
technologies and stimulate the innovative uses of netw orks to deliver products and services.  Both 
countries would seek to avoid imposing customs duties on electronic transmissions; imposing 
unnecessary barriers to market acces s for digitized products; and impeding the ability to deliver 
services through electronic means.  Jordan ha d made market access and national treatment 
commitments in all the sectors critical to comple ting an electronic commerce transaction, including 
telecommunications, computer-related services, fina ncial services, distribution services and express  WT/REG134/M/1 
 Page 3 
 
 
 delivery services.  The Agreement also contained tr ade-related labor and e nvironmental provisions.  
Those provisions would not require either country to  adopt any new labor or environmental laws, and 
each country retained the absolute right to set its own labor and environm ental standards and to 
change those standards.  She thanked the Chairman  for the opportunity to present the information on 
the United States-Jordan FTA to the CRTA hoping that it would give Members a greater 
understanding of the terms of the Agreement.  Sh e added that her delegation would be pleased to 
answer any questions the Members might have. 
7. The representative of Jordan  stated that her government welcomed the opportunity to submit 
the Agreement establishing an FTA between Jordan  and the United States for examination.  She 
hoped that the background information provided in th e Standard Format and the joint introductory 
statement presented by the representative of the United States would allow the Committee to make 
progress on the factual part of the examination.  In  that respect, she stressed the importance that 
Jordan attached to the multilateral trading system  and WTO principles, and to the importance of 
regional trade agreements in integrating devel oping countries into the world economy.  The FTA 
between Jordan and the United States was a compre hensive agreement in sc ope, which substantially 
liberalized trade in industrial and agricultural goods  and services, and which was in compliance with 
Article XXIV of the GATT and Article V of the GA TS, respectively.  The Agreement established a 
more secure and predictable framework for the conduct of business.  It was designed to further 
strengthen trade and economic ties between the two c ountries with a view to raising living standards 
and promoting economic growth, investment opportu nities and employment; fostering creativity and 
innovation and promoting trade in goods and services that were the subject of intellectual property 
rights; and eventually raising the capacity and in ternational competitiveness of both countries' goods 
and services.  The Agreement also recognized that Jordan was still in a state of development and 
faced special challenges.  The gradual approach of liberalization within the 10 year transitional period 
allowed a progressively closer economic relationshi p while giving the needed time to improve the 
competitiveness of Jordan's different economic sectors and industries. 
8. The representative of Jordan added that the two years of implementation of the Agreement 
had shown a positive increase in trade relations betw een Jordan and the United States as one of its 
major trading partners.  The Agreement complemented  Jordan's foreign trade policy, which was based 
on the norms of economic openness and integration in to the rapidly globalizing world economy.  Such 
policy incorporated the country's vision and pos itive view of economic partnerships as necessarily 
achieving both mutual interests and fair dividends.  Jordan had made giant strides on the path of 
economic and trade liberalization in addition to reinforcing the mechanisms and functioning of a 
market-orientated economy; this was made possible through intensive reform process bringing about a 
modern and conducive regulatory environment for business and investment.  She added that her 
delegation was prepared to clarify any questions or  comments that Members might have and that they 
would provide further replies in writing if needed.  She concluded by informing Members of the 
Jordanian website address (www.jftp.gov.jo) where the Agreement's tariff elimination schedules and 
services schedules were available, which had been  dropped by mistake form the Standard Format 
document. 
Goods aspects  
 
B. SECTION I - BACKGROUND INFORMATION ON THE AGREEMENT  
9. The representative of Japan  commended the Parties for their very comprehensive and detailed 
introductory statements.  He noted that the Agreement had been notified after the date of its entry into 
force and, for the sake of consistency, wished to kno w the reasons for that delay.  He added that his 
delegation placed much importance on the question of transparency.  It was essential that WTO 
Members have the opportunity to learn of the de velopments that were taking place prior to any 
agreement taking effect.  The representative of the United States  acknowledged the point made and WT/REG134/M/1 
Page 4  
 
 said that it was surely due to human error.  Having said that, she wished to draw Members' attention 
to the fact that the approval of the Agreement by  the United States' Congres s occurred a substantial 
amount of time after the Agreement had been signe d and at a time of the year which may have 
contributed to the delay in notification.  She adde d that they could provide a more precise answer in 
writing if necessary. 
C. S
ECTION II - TRADE PROVISIONS  
10. The representative of the European Communities  asked the Parties whether the Agreement 
provided for any tariff-rate quotas (TRQs) and, if that  was the case, on which products and with which 
sectoral coverage.  The representative of the United States  said that they could provide a complete 
answer in writing; she indicated, however, that the United States had preferential transitional TRQs on 
some agricultural products (dairy, peanuts, cotton and sugar).  These TRQs were specific to Jordan 
and additional to the market access provided to WTO Members in the Uruguay Round TRQs.  All of 
the commodities under TRQ were included for elimination in the ten-year phase-out period and the elimination applied to the over-duty quota rate on those commodities.  The representative of Jordan
 
clarified that her country did not apply any TRQs. 
11. The representative of Japan,  referring to the last sentence of Section II:3 of the Standard 
Format dealing with Rules of Origin, wished to know  what rules of origin applied to processed citrus 
products.  The representative of the United States  indicated that the Agreement contained a specific 
rule for citrus which outlined the origin requireme nts, adding that a description could be submitted in 
writing. 
12. The representative of Japan  recalled his delegation's view th at safeguard measures should not 
be applicable among the parties to an RTA, and requ ested the views of the Parties on that point in the 
context of the Agreement.  The representative of Jordan  said that the issue was addressed in Article 
10:8 of the Agreement, adding that they w ould provide a detailed answer in writing. 
13. The representative of Chinese Taipei  sought clarification with r espect to the conditions under 
which the Parties could be exempted from a global sa feguard measure as mentioned in paragraph 1 of 
Section II:5 of the Standard Format.  He was also interested in knowing how the Parties would ensure 
that the implementation of such a rule would be in  line with the Panel and A ppellate Body findings on 
that issue.  The represen tative of the United States  said that they could provide that answer along with 
the one to Japan in writing, and that they would cer tainly address the Appellate Body findings in their 
answer. 
14. The representative of Japan  noted that the Agreement contained no provisions on anti-
dumping and countervailing measures.  To his question of whether that meant that the Parties were 
bound by the rights and obligations of the WTO in this matter, the representative of Jordan  replied in 
the affirmative. 
D. GENERAL PROVISIONS OF THE AGREEMENT  
15. The representative of the European Communities  had two questions in relation to Section 
III:4 of the Standard Format.  First, noting that the Agreement contained very specific provisions on 
the protection of geographical indications (GIs), he  wished to have more precise information on the 
definition of GIs, especially as it appeared from foot note 8 of the Agreement that GIs could apply to 
both goods and services.  He asked the Parties whet her they could provide some examples of products 
that would benefit from GI protection.  His sec ond question concerned the relationship between the 
Doha Declaration on the TRIPS Agreement and Pub lic Health and the Agreement being examined.  
Recalling, in particular, that Ministers had recogni zed in the Declaration that "each member has the 
right to grant compulsory licences and the free dom to determine the gr ounds upon which such  WT/REG134/M/1 
 Page 5 
 
 
 licences are granted", he wondered whether paragr aph 20 of Article 4 of the Agreement, which 
appeared to strictly limit the grounds for providin g compulsory licences to three areas, entailed that 
the Agreement prevailed over the aforementioned Decl aration or that the Declaration, since it post 
dated the Agreement, would overrule Article 4:20.  The representative of the United States  said that 
both questions involved a fair amount of legal interpretation and that th ey would reply in writing.  She 
clarified, however, that in the Agreement GIs arose in the context of trade marks. 
16. The Chairman  said that the first round of examination of the goods aspects of the FTA 
between the United States and Jordan had allowed the Committee to clarify a number of issues, but 
some remained pending.  He invited those delegatio ns wishing to ask questions to forward them in 
writing to the Secretariat by 18 April 2004 and Parties to submit replies  in writing by 28 May 2004. 
Services aspects  
 
E. SECTION I – BACKGROUND INFORMATION ON THE AGREEMENT  
17. With respect to scope, the representative of Chile  asked the Parties for information on the 
sectors which had been excluded from the Agreement.  The representative of Japan  informed the 
Committee that his delegation had several questions with respect to scope which would be submitted 
in writing since they were rather long. 
18. The representative of the United States  said that they looked forward to receiving the 
questions from Japan.  With respect to the questio n from Chile, he said that as indicated in their 
opening statement, this was a positive list Agreemen t, meaning that the sectors that were covered by 
each Party to the Agreement were indicated in listing in  their particular schedule.  In that sense, the 
sectors that were covered and those that were ex cluded operated in the same fashion as under the 
GATS in the WTO.  The representative of Chile  said that she understood how a positive list operated, 
but recalled that the Committee was mandated to exam ine whether the Agreement was consistent with 
the requirements of GATS Article V:1 on substantia l sectoral coverage.  In order to do that, 
information on the sectors that were excluded from th e Agreement was necessary.  She informed the 
Parties that the question would be submitted in writing. 
19. Turning to trade data, the representative of Chile  asked the Parties whether any information in 
that respect was available.  She indicated that since mode 3 was included it was perhaps possible to 
have at least some information on investme nts.  The representative of the United States  remarked that 
difficulties in providing trade statistics in the ser vices area had been observed before.  She added, 
however, that both the United States and Jordanian delegations would refer back to their respective 
Authorities to see whether any information in th at area could be provided to the Committee. 
F. SECTION II – PROVISIONS AFFECTING TRADE IN SERVICES  
20. The representative of Australia  noted that many of the dates indicated in the Standard Format 
with respect to the scheduled elimination of di scriminatory restrictions had passed and wondered 
whether it was possible to obtain an update on what had happened to date. 
21. The representative of th e European Communities  noted that the Agreement had been notified 
as an economic integration agreement having substa ntial sectoral coverage and providing for the 
elimination of substantially all discrimination.  Ho wever, his delegation had not been able to detect 
any difference between the Parties' schedules of commitments under the Agreement and those notified 
under the GATS.  In that respect he  had three questions:  first, whet her the United States and Jordan 
were granting each other's services and service supplie rs the exact same treatment as they granted to 
all WTO Members; second, whether the Agreem ent provided for any additional preferential 
liberalization of trade in services between th e Parties which went beyond their respective WT/REG134/M/1 
Page 6  
 
 commitments under the GATS; and third, with respect to the application of Article 8 of the 
Agreement on Visa Commitments, whether the Parti es were adding to their respective scheduled 
commitments under Mode 4.  In relation to the latter qu estion, he added that, if that was the case, then 
he would be interested to know which categories of  persons were covered and whether there were any 
quotas for such persons. 
22. The representative of Chile
 wanted to know whether the quantitative restrictions which had 
been eliminated applied only between the Parti es or they extended to all other WTO Members. 
23. The representative of the United States  said that with respect to the question posed by the 
delegate of Australia he would have to check w ith his Authorities to ensure that the reply was 
accurate.  Turning to the questions posed by the de legate of the European Communities, he indicated 
that his colleague from Jordan would reply.  He  added that the question relating to the Visa 
Commitments would be replied to in writing since it  was very detailed.  The representative of Jordan  
said, with respect to the question posed by the Au stralian delegate, that commitments scheduled for 
elimination for 2002 and 2003 had ta ken effect.  As for the questi on from the European Communities, 
she indicated that Jordan's commitments under the Agreement built upon their GATS commitments 
and thus went beyond the GATS schedule. 
24. The representative of Switzerland  sought clarification as to the meaning of Section II:2 and 4 
of the Standard Format dealing respectively with ru les of origin and safeguards, which read that the 
language in the Treaty on those pr ovisions related to goods and no t services.  The representative of 
the United States  confirmed that the provisions on rules of origin and safeguards contained in the text 
of the Agreement were directed only to the goods  aspects of FTA.  He explained that since the 
Agreement covered in a single text both goods a nd services aspects, they had drafted the Standard 
Format on the services aspects in that way to make cl ear that those provisions existed but that they did 
not apply to services. 
25. The Chairman  said that the first round of examin ation of the services aspects of the FTA 
between the United States and Jordan had allowed the Committee to clarify a number of issues, but 
some remained pending.  He invited those delegatio ns wishing to ask questions to forward them in 
writing to the Secretariat by 18 April 2004 and Parties to submit replies  in writing by 28 May 2004. 
26. The Committee took note  of the comments made. 
__________