RESTRICTEDWORLD TRADE
ORGANIZATIONG/RO/M/18
20 July 1998
(98-2852)
Committee on Rules of Origin
MINUTES OF THE MEETING OF 1 AND 6 JULY 1998
Chairman:  Mr. R. Wells (Australia)
The agenda proposed for the meeting, contained in WTO/AIR/870, was adopted by the
Committee on Rules of Origin (CRO) as follows:
Page
1. Future work of the Committee on Rules of Origin in connection
with the Harmonization Work Programme................................................................. 1
2. Other business............................................................................................................. 3
- Date of the ne xt meeting................................................................................... 3
1. Future work of the Committee on Rules of Origin in connection with the Harmonization
Work Programme
1.1 Based on informal consultations held by the Chairman with Members, the CRO accepted  the
report of the CRO, contained in document G/ RO/25, to the Council for Trade in Goods on the
Harmonization Work Programme.  The CRO also mandated the Chairman to send this report to the
Chairman of the Technical Committee on Rules of Origin (TCRO)1.
1.2 The representative of Morocco stated as follows:
“Developing countries such as Morocco have difficulty in keeping up with the work of both
the CRO and the TCRO.  Despite their best efforts,  because of their modest resources, human and
material, these countries are unable to maintain such a rapid pace.  The difficulties encountered in
these negotiations are of two kinds:  problems of form, associated with the frequency and length of
the meetings and the composition of the delegations, and problems of substance concerning the actualsubject of the negotiations.
Problems of form:
- The limited material resources of the developing countries and the frequency of the meetings
mean that they are unable to attend all the meetings organized by the two committees.
- The length of the sessions, which in Brussels is often two weeks, with other meetings in
Geneva in between, is an obstacle to the regular participation of the Members of the
                                                     
1 The Chairman's letter was circulated to Members in document G/RO/26.G/RO/M/18
Page 2
developing country delegations which do not have sufficient human resources to devote to
these meetings.
- The developing country delegations, mainly composed of administrative personnel, lack the
necessary background and expertise, especially for the Brussels negotiations which are highlytechnical and call for product specialists.
- Rules of origin are very important for the application of other WTO Agreements (market
access, anti-dumping measures, geographical indications, etc.).  Accordingly, an analysis of
the implications of the various options proposed in the rules of origin negotiations for the
application of these Agreements is essential for the progress of the negotiations.  However,
the smaller delegations are not in a position to undertake such an analysis.  It would thereforebe desirable for the WTO Secretariat to carry out such studies as part of the technical
assistance for smaller delegations, in order that the latter may participate effectively in the
discussions.
Problems of substance:
- The technological gap between the developed and the developing countries is leading to a
divergence of views on the evaluation of certain industrial operations (mixing, assembly, etc.)
and their ability to confer origin on manufactured products.  Thus, a number of operations
considered simple - and unable to confer origin - by the developed countries are veryimportant for the industrial fabric of the developing countries.  In this connection, the interests
of the developing countries should be taken into consideration, in particular the possibility of
being able to use a combination of several simpler operations to confer origin on products
manufactured in those countries.
For example, the draft notes and rules relating to Chapters 85-90 and 93 consider a number of
assembly operations to be very simple and unable to confer origin.  However, the result of
combining a number of these operations is substantial.
Thus, the installation of an isolator in a transformer substation requires the following
operations:
- Installation of the apparatus in the box;
- Installation of dials, buttons, handles or other user-operated controls;
- Installation of power cables connecting th e operators with the network and power
transformers.
Taken individually, these three operations are simple, but combining them results in a
substantial assembly operation.
- Now that services, intellectual property and information technologies are beginning to
account for such a large proportion of the world economy, it has become necessary to take the
new order into consideration in determining the origin of products.  This involves, in
particular, preliminary studies, tests on manufactured products, licence fees and royalties, and
services relating to information technology.G/RO/M/18
Page 3
1.3 Morocco proposes therefore the following:
- Considering the progress of the work and the difficulties encountered by the developing
countries, Morocco supports the proposal to extend the mandate of the two rules of origin
committees in order that they may complete th eir work, provided that a definite time-limit is
set.
- A mid-term evaluation of the results of this vast negotiating process, in the light of what has
been achieved so far, the amount of work remaining to be done and the difficulties
experienced by the developing countries, is necessary insofar as it will enable the future work
of the two Committees to be planned out.
- A new approach to rules of origin which takes into account the other components of the world
economy, namely, services, intellectual property and information technologies, should be
considered.
- The preparation by the Secretariat of studies and analyses of the various aspects of rules of
origin, in particular, their impact on the application of other WTO Agreements (Agreements
on Textiles and Clothing, Market Access, etc.) and the effect of the various rules of origin
proposals arising from the discussions on the sectors in question, is very important for the
developing countries insofar as it will enable them to pursue the negotiations more
effectively.
- Morocco proposes that the CRO should study th e possibility of holding a high-level meeting
on rules of origin to examine the various points raised above and the strategy to be adopted
for future work.
- Morocco cannot accept the return of the templates to the Technical Committee for review.
For this reason, the Moroccan delegation cannot give a final opinion on the draft programme
without first having cleared up a number of issues and problems encountered during the three
years of activity of the two Committees.”
2. Other business
- Date of the next meeting2.1 It was agreed that the CRO hold its next meeting on 16 October 1998, preceded by informal
consultations on 14 and 15 October 1998.
__________