RESTRICTED
WORLD TRADE G/LIC//M/5
7May1997
ORGANIZATION(97-1971)
Committee onImport Licensing
MINUTES OFTHE MEETING HELD ON22APRIL 1997
Chairman: Mr.Calson Mbegabolawe
1. TheCommittee onImport Licensing helditsfifthmeeting on22April 1997. Theagenda
proposed forthemeeting, contained inWTO/AIR/571, wasadopted asfollows:
Page
A. Observer status ofinternational intergovernmental organizations 1
B. Notifications under Articles 1.4(a) and/or 8.2(b) 2
(publications and/or legislation)
C. Notifications under Article 7.3(Replies toQuestionnaire on 3
Import Licensing)
D. Notifications under Article 5 5
E. Other business 6
F. Election ofOfficers 6
A. Observer status ofinternational intergovernmental organizations
2. TheChairmanreferredtodocumentG/LIC/W/7whichlistedtheinternationalintergovernmental
organizations (IMF, UNCTAD andtheWorld Bank) having observer status onanadhocbasisinthe
Committee, andtheAfrican, Caribbean andPacific Group (ACP Group) whose request forobserver
status waspending. InthecaseoftheIMFandtheWorld Bank, theirobserver status intheWTO
anditsvarious bodies, including theCommittee onImport Licensing, wascovered byvirtue ofthe
Agreements concluded between theWTO andtheIMFandtheWorld Bank (WT/L/195).
3. TheCommittee tooknoteofthisfact.
4. InthecaseofUNCTAD, given thefactthatitalready hadobserver status intheCommittee
onanadhocbasis, theChairman proposed thattheCommittee agree toaccord itobserver status on
aregular basis.
5. Itwassoagreed.
6. Therepresentative oftheUnited States suggested thatconsideration ofrequests forobserver
status bytheACPGroup bedeferred toafuture meeting pending guidance fromtheGeneral Council
ontheoverall issue ofobserver status.G/LIC//M/5
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7. Itwassoagreed.
B. Notifications under Articles 1.4(a) and/or 8.2(b) (publications and/or legislation)
8. TheChairman saidthatsince thelastmeeting, theSecretariat hadreceived notifications under
Articles 1.4(a) and/or 8.2(b) fromthefollowing 15Members: Benin, Bulgaria, Burkina Faso, European
Communities, Honduras, Hong Kong, Hungary, India, Japan, Korea, Mauritius, Singapore, Slovenia,
Tunisia andtheUnited ArabEmirates. These notifications werecirculated intheG/LIC/N/1/- series.
Copies ofpublications andlawsandregulations referred tointhenotifications were available for
consultation intheSecretariat. Inaddition, Switzerland hadrecently notified publications andlegislation
relevant toimport licensing which would beconsidered atthenextmeeting. Copies ofpublications
andlegislation submitted bySwitzerland were alsoavailable forconsultation intheSecretariat.
9. Hesaidthatasatthedateofthepresent meeting, outofaMembership of130onlyatotal
of40Members (counting theEuropean Communities asone)hadsubmitted notifications relating to
publications and/or lawsandregulations. Heurged Members thathadnotyetprovided anyinformation
concerninglawsandregulationsandpublicationsrelevanttoimportlicensingtosubmittheirnotifications
without anyfurther delay.
10. Therepresentative ofJapan saidthataccording tothenotification made byKorea circulated
indocument G/LIC/N/1/KOR/1, acopyofitsForeign Trade Actanditssubordinate regulations which
provided thebasic framework ofKorea 'simport licensing procedures hadbeensubmitted onlyinthe
Korean language. According totheprocedures fornotification andreview agreed bytheCommittee
atitssecond meeting (G/LIC/3), incases where thelegislation orpublications were notinaWTO
official language, Members were required tosubmit, together withsuchpublications orlegislation
asummary ofthenotification inaWTO official language. Theprocedures agreed provided other
Members withthepossibility ofasking forafulltranslation iftheysowished orseekanyadditional
information onabilateral basis. Japan wasinterested inKorea 'simport licensing procedures and
therefore would appreciate itifKorea could provide afulltranslation ofitsForeign Trade Actand
thesubordinate regulations assoonaspossible. Furthermore, itwasreported byKorea thattheMinistry
ofTrade, Industry andEnergy ofKorea hadindicated on31March 1997 itsintention toimprove the
current regulations onimport licensing procedures. Japan appreciated theefforts made byKorea in
thisregard. Pursuant toArticles 1.4(a) and8.2(b), Korea wasrequired tonotify themodification to
thisCommittee aftertheimprovements hadbeenmade.
11. Therepresentative ofKorea saidthatthequestion posed bytheJapanese delegation would be
conveyed tohisauthorities andthatareply would begiven inwriting assoonaspossible. Hefurther
saidthatasthedocument indicated, Korea hadprovided asummary inEnglish ofsome oftheregulations
notified inKorean language, which hadnotbeenattached tothedocument.
12. TheChairman saidthatinaccordance withtheprocedures fornotification agreed bythe
Committee, textsoflawsandregulations notified byMembers, aswellasanytranslations provided,
were keptintheSecretariat forconsultation byinterested Members.
13. Therepresentative oftheUnited States ,recalling thediscussions intheCommittee which had
ledtotheproceduresthatwereagreed,wonderedwhethersuchinformationsubmittedshouldbecirculated
routinely forthebenefit ofallMembers. Hesuggested thattheCommittee revert tothisissue ata
future meeting. Furthermore, inaccordance withtheUnderstanding reached bytheCommittee atits
lastmeeting, hisdelegation would submit questions inwriting onthenotifications submitted recently
under thisagenda item.
14. TheCommittee tooknoteofthenotifications andstatements.G/LIC//M/5
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C. Notifications under Article 7.3(Replies toQuestionnaire onImport Licensing Procedures)
15. TheChairman informed theCommittee thatsince thelastmeeting, thefollowing 14Members
hadsubmitted replies totheQuestionnaire: Bolivia, Brunei Darussalam, Bulgaria, Burkina Faso,
Colombia, Fiji,Japan, Korea, Namibia, NewZealand, Philippines, Senegal, Singapore andTunisia.
Therelevant notifications hadbeencirculated intheG/LIC/N/3/- series. Inaddition, theSecretariat
hadrecently received anotification from Switzerland, which would besubject toreview atthenext
meeting. Todate, outofaMembership of130onlyatotalof37hadsubmitted replies tothe
Questionnaire. Heexpressed concern thatthenumber ofMembers thathadnotmade anynotifications
under thisprovision sincetheWTO Agreement entered intoforceremained veryhighandherequested
those Members which hadnotyetcomplied withtherequirement todosowithout further delay. He
alsoreminded Members thatnotifications under Article 7.3wererequired fromevery Member onan
annual basis, by30September.
16. Therepresentative ofJapan saidthathisdelegation hadsubmitted toKorea questions inwriting
concerning theKorean notification wellinadvance ofthepresent meeting. These questions were
subsequently circulated indocument G/LIC/Q/KOR/1. Itwould beappreciated iftheKorean delegation
could reply tothequestions, atleastorally, atthepresent meeting, aswellasinwriting atalaterdate.
Henoted thatparagraph 27oftheTrade Policy Review report (WT/TPR/S/19) clearly stated thatKorea
prohibited import ofspecific Japanese products inthecontext ofitsImport Diversification Programme.
TheProgramme, which appeared intended mainly toredress Korea 'spersistent bilateral trade deficit,
involved 258items atthe10-digit HSlevelin1993. Thisseemed contrary tothereply provided by
Korea(indocumentG/LIC/N/3/KOR/1)toQuestion4whereitstatedthatthepurposeofimportlicensing
was"nottorestrict thequantity orvalue ofimports buttomonitor foreign trade trends andmaintain
foreign trade statistics". Despite theintention andtherestrictive nature ofthemeasures taken under
theProgramme, Korea didnotmention anything about theProgramme inthenotification under
Article 7.3.Korea hadannounced thatitwould halve thenumber ofproducts covered under thesystem
overaperiod offiveyears, asfrom 1994. Thisaction hadreduced thecoverage ofrestrictions to
127items asofJanuary 1997. Inconjunction withitsmembership intheOECD, Korea hadpromised
toeliminate thesystem entirely bytheendof1999. While Japan appreciated Korea 'sexpression of
intent toeliminate themeasures, itwasoftheview thatmeasures based ontheProgramme were
inconsistent withtherelevant GATT 1994 provisions andought tobeeliminated without delay.
17. Therepresentative ofKorea saidthatthequestions posed byJapan weretaken noteoftobe
transmitted tohisauthorities. Heinformed theCommittee thatinaccordance withtheAgreement on
Import Licensing Procedures, theKorean Government hadalready notified itsImport Diversification
Programme totheCommittee onImport Licensing indocument G/LIC/N/1/KOR/1. Although itwas
truethattheKorean Foreign Trade Actanditssubordinate regulations hadbeensubmitted intheKorean
language, information onthisProgramme inEnglish language maybeobtained fromthetrade policy
review report submitted bytheKorean Government andfromthereport bytheSecretariat. Hesaid
thatKorea 'sImport Diversification Programme hadbeenintroduced in1978 inaneffort toredress
thestructural trade deficit withJapan. Korea hadnotexperienced atrade surplus withJapan during
thelast36years anditstradedeficit withJapan in1996was76.2percentofthetotaldeficit. However,
theKorean Government hadcontinuously reduced thescope ofthisProgramme andithadbeen
announced thatthissystem would bephased outbytheendof1999. Furthermore, Korea 'sreplies
totheQuestionnaire circulated indocument G/LIC/N/3/KOR/1 referred onlytoitsgeneral import
licensing system andnotdirectly totheImport Diversification Programme.
18. Therepresentative ofthePhilippines saidthatherdelegation wasalsointerested inseeing
thereplies ofKorea toquestions posed byJapan. ThePhilippines hadbeenaware ofKorea 'sImport
Diversification Policy forsome timenowandwere concerned about itseffects. Asthird country
exporters, especially those which engaged injointventures withJapanese companies, hercountry tooG/LIC//M/5
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wassimilarly effected byKorea 'sImport Diversification Policy. Products affected bytheProgramme
were those which were covered bytheInformation Technology Agreement.
19. Therepresentative ofJapan thanked theKorean delegation forproviding theoralreply and
saidalthough theapproval ofanAssociation ofForeign Trading Agents ofKorea wasrequired for
imports ofproducts exported byacountry thathadthelargest trade surplus withKorea forthelast
fiveyears, thisapproval wasnormally notgiven, andthis,therefore, functioned asadefacto import
ban.Japan wasoftheviewthatthismeasure wasclearly inviolation oftheGATT 1994. AstheKorean
representative said,thissystem hadnotbeennotified tothisCommittee. Ithadnotbeenmentioned
inthereplies totheQuestionnaire, hence therequest toKorea toprovide areply withrespect tothe
Programme.
20. Therepresentative ofSwitzerland saidthatthenotification ofreplies totheQuestionnaire
submitted bySwitzerland corresponded alsototherequirements fornotification under Articles 1.4(a),
8.2(b) and5.1-5.4 oftheAgreement. Hefurther stated thatthenotification wasbeing made forpurposes
oftransparency andwithout prejudice tothequestion ofapplicability oftheAgreement onImport
Licensing Procedures toagricultural tariff quotas.
21. Therepresentative ofNewZealand expressed concern overthelackofnotifications submitted
under theAgreement todate. Inthisregard, hecommended Bulgaria, which hadonlyrecently acceded
totheWTO, forsubmitting therequired notifications within arelatively short period. Heasked for
further details andclarification concerning theprocedures notified inthereplies totheQuestionnaire.
According toBulgaria 'sreply toQuestion 1,non-automatic licences wererequired fortheimportation
ofsomeproducts withaviewtopreventing shortages offoodstuffs andproducts essential totheeconomy
intransition.However,Bulgariahadnotifiedanumberoffoodproductsassubjecttoautomaticlicensing
formonitoring purposes (Part IIofAnnex I).Hisdelegation wondered whether these products were
infactsubject tonon-automatic import licensing, andifsowhatthejustification wasforsuchameasure.
Henoted inthiscontext thatupon accession totheWTO Bulgaria hadundertaken toeliminate, and
nottointroduce, non-tariff measures suchaslicensing. Further, hesought clarification ofBulgaria 's
reply toQuestion 12which stated thatthere wasalicensing feedepending onthevalue ofgoods.
ThiswasinconsistentwiththestatementindocumentWT/ACC/BGR/5,page19that"nofeesarecharged
fortheissuing oflicences". Article VIIIofGATT 1994 clearly stated thatfeesinconnection with
importation, including those relating tolicensing, should belimited inamount totheapproximate cost
ofservices rendered andshould notrepresent anindirect protection todomestic products orataxation
ofimports. Herequested theBulgarian delegation toexplain whyitconsidered thatafeedepending
onthevalue ofgoods wasconsistent withArticle VIIIofGATT 1994. Finally, thelicensing system
applicable totobacco andtobacco products wasunclear. Document WT/ACC/BGR/5, page19stated
thatmanufactured tobacco andtobacco products weresubject tonon-automatic import licensing, whereas
documentG/LIC/N/3/BGR/1(AnnexI,PartI)listedunmanufacturedtobaccoassubjecttonon-automatic
import licensing andtobacco products assubject toautomatic import licensing.1
22. TherepresentativeofBulgariasaidthatthequestionsposedbyNewZealandwouldbetransmitted
tohisauthorities oncetheywerereceived inwriting. Asapreliminary response tothequestions posed,
hewished tostatethattheenumeration ofreasons (inreply 4)forhaving anautomatic licensing regime,
includingforthepreventionofshortagesoffoodstuffsandproducts,wasagenerallegislativerequirement
forbothimport andexport licensing. Thelistoffoodstuffs andproducts which therepresentative of
NewZealand referred towasinPartIIofAnnex Iofthenotification related toautomatic import
licensing. Asforthelicensing fee,thiswasafeeforservices rendered bythecustoms authorities,
andintheProtocol ofAccession, Bulgaria hadundertaken tomodify thelicensing feebytheendof
1Thequestions were subsequently submitted inwriting andcirculated indocument G/LIC/Q/BGR/1.G/LIC//M/5
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1997. Hefurther informed theCommittee thatthenon-automatic licensing regime fortobacco and
tobacco products hadbeen abolished recently inaccordance withthecommitments Bulgaria had
undertaken inthecourse ofitsaccession totheWTO.
23. TherepresentativeofNewZealandaskedJapanonwhatWTO-consistentbasisJapanmaintained
quantitative import quotas onmarine products. Hefurther requested Japan toconfirm thatricewas
theonlyagricultural product forwhich import licensing wasapplied. NewZealand wasoftheview
thattheAgreement onImport Licensing Procedures wasapplicable toproducts subject totariff-quota
access.2
24. Therepresentative ofJapan didnotthinkthatthiswastheforum toraisequestions ontheWTO-
consistency ofimport quotas onanyproduct. However, oncethequestion from NewZealand was
submitted inwriting itwould besenttohiscapital forareply. Asforthequestion regarding rice,
heunderstood thatitwastheonlyagricultural product which wassubject toimport licensing. Japan
tooktheviewthattariff-rate quotas werenotsubject tothisAgreement asimporters didnotneedprior
approval toimport products subject totariff-rate quotas andcould import asmuch astheywished outside
thetariff-rate quota.
25. Therepresentative ofNewZealand saidthathetookadifferent view ontheapplicability
oftheLicensing Agreement totariff-rate quotas. Hewondered whytheJapanese delegation considered
thatthiswasnottheappropriate forum toaddress theissuerelating tomarine products andrequested
thereasons tobereiterated inthewritten reply. Herequested thedelegation ofKorea toexpand on
itsreply toQuestion 4(G/LIC/N/3/KOR/1), which stated thatthepurpose ofimport licensing was
"nottorestrict thequantity orvalue ofimports buttomonitor foreign tradetrends andmaintain foreign
trade statistics". Hisdelegation queried whether asystem ofimport licensing wasnecessary simply
forthepurpose ofmonitoring trade andwhether Korea hadconsidered alternative mechanisms for
achieving this. Hefurther requested Korea toclarify howitadministered quotas forproducts subject
torestrictions astotheirquantity orvalue, inparticular, thecriteria andconditions bywhich import
licences were allocated3.
26. Therepresentative oftheUnited States saidthatinaccordance withtheUnderstanding reached
bytheCommitteeatitslastmeeting,hisdelegationwouldsubmitquestionsinwritingonthenotifications
submitted recently under thisagenda item.
27. Therepresentative oftheEuropean Communities saidthatherdelegation would submit the
relevant notification within thenextfewdays. Shewished toreserve therighttoposequestions on
thenotifications listed intheairgram atalaterstage.
28. Therepresentatives ofAustralia andCanada saidthattheywould submit theirreplies tothe
Questionnaire shortly.
29. TheCommittee tooknoteofthenotifications andstatements.
D. Notifications under Article 5
30. TheCommittee tooknoteofthenotifications submitted byArgentina andHong Kong circulated
intheG/LIC/N/2/- series.
2Thequestions were subsequently submitted inwriting andcirculated indocument G/LIC/Q/JPN/1.
3Thequestions were subsequently submitted inwriting andcirculated indocument G/LIC/Q/KOR/2.G/LIC//M/5
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E. Other business
Dateofnextmeeting
31. Thenextmeeting oftheCommittee willbeheldon15October 1997.
F. Election ofOfficers
32. TheChairman stated that,inlinewiththe"Guidelines fortheAppointment ofOfficers toWTO
bodies" (WT/L/31), theChairman oftheCouncil forTrade inGoods (CTG) hadconducted consultations
ontheappointment ofchairpersons ofthesubsidiary bodies oftheCTG, asaresult ofwhich consensus
hadbeenreached onthenomination ofMr.Tomasz Jodko (Poland) asChairman oftheCommittee
onImport Licensing (G/C/M/17, paragraph 5).
33. TheCommittee elected Mr.Tomasz Jodko (Poland) asChairman oftheCommittee by
acclamation, toholdoffice untiltheendofthefirstmeeting in1998, under Rule12oftheCommittee 's
Rules ofProcedure (G/L/147).
34. TheCommittee elected Mr.Rossman Ithnain (Singapore) asthenewVice-Chairman.