WT/REG233/2  
 
4 September  2019 
(19-5661) Page: 1/7 
Committee on Regional Trade Agreements  Original: English /Spanish  
 
CENTRAL EUROPEAN FRE E TRADE AGREEMENT  
(GOODS)  
QUESTIONS AND REPLIE S 
 The following communication, dated 28 August  2019, is being circulated at the request of the 
delegations of  Albania, Bosnia and Herzegovina, Kosovo1, Republic of Moldova, Republic of 
Montenegro, North  Macedonia and  Republic of Serbia . 
 
_______________  
 
 
Questions from the delegation of Canada  
 
Provisions on Trade in Goods  
 
Technical barriers to trade 
 
1.1.  Paragraph 3.35 states:  "The Parties shall identify and eliminate unnecessary existing 
technical barriers to trade within the meaning of the respective WTO Agreement and not 
to introduce new ones. " 
 Canada would appreciate a description of what an 'unnecess ary existing technical 
barrier to trade ' is within the meaning of the WTO TBT Agreement.  Could you please 
specify which article, in the TBT Agreement, provides that technical barriers to trade that 
are unnecessary are inconsistent with a WTO Members ' oblig ations under the 
TBT agreement?  
 
 Parties of the CEFTA Agreement  thank the delegation of Canada for the interest shown in the 
CEFTA Agreement.  
 
Response from the delegations of Albania, Bosnia and Herzegovina, Kosovo, Montenegro, the 
Republic of Moldova, North Macedonia and Serbia : 
 
 Article 13 (1) of the CEFTA 2006 provides that  the rights and obligations of the Parties relating 
to the application  of technical barriers to trade, shall be governed by the WTO Agreement on 
Technical Barriers to Trade, except as otherwise provided for in that Article. Article 13(2) of the 
CEFTA 2006 provides that th e CEFTA Parties undertake to identify and eliminate un necessary 
existing technical barriers to trade within the meaning of the WTO Agreement on Technical Barriers 
to Trade.  
 
 Taking that into account, out of the current Parties, only Albania, North Macedonia and 
Moldova2 were members of the World Trade Organi zation when the CEFTA  Agreement  entered into 
force, and taking into account the relationship of the Parties with the EU , the Parties additionally 
undertook the commitment to co -operate in relevant CEFTA structures to facilitate and harmoni ze 
technical regu lations, standards and mandatory conformity assessment procedures with the aim of 
eliminating technical barriers to trade . CEFTA Parties  were strongly encouraged to harmonize its 
                                                
1 All references to Kosovo in this document should be understood to be in the context of the United 
Nations Security Council resolution 1244 (1999).  
2 Montenegro joined the WTO in 2012.  WT/REG233/2  
 
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  technical regulations, standards and mandatory conformity assessment procedur es with the relevant 
EU measures and they also undertook to enter into negotiations to conclude plurilateral agreements 
on harmonization.  Consequently, the phrase "eliminate unnecessary existing technical barriers to 
trade " refers to the harmonization of measures and deepening of free trade in goods based on the 
above -listed principles.   
 
General Provisions of the Agreement  
 
Dispute settlement  
 
1.2.  Paragraph 4.17 states: "Whenever the Parties concerned agree, the consultations 
may take place in the presence of a mediator. Unless they agree on a mediator within ten 
days of the request for mediation, he/she is to be appointed by the Chair of the Joint 
Committee within 20 calendar days of receipt of the initial written request.3 The mediator 
shall present a final report to the Joint Committee at latest 60 calendar days after being 
appointed. If no solution can be found on the basis of the mediator's report, and the Joint 
Committee fails to find a commonly acceptable solution, it sha ll recommend appropriate 
measures ." 
a. Is the final report of the mediator public?  
b. Is the final report without prejudice to potential further dispute -settlement 
proceedings?  
Response from the delegations of Albania, Bosnia and Herzegovina,  Kosovo,  the Republic of Moldova, 
Montenegro, North Macedonia  and Serbia : 
 
 Disputes between CEFTA  Parties  may be resolved through consultations (including in the 
presence of a mediator , Article 42(3) of the CEFTA 2006 ), arbitration (Article 43 of the CEFTA 2006), 
and the WTO's Dispute Settlement Understanding . 
 
 Since the CEFTA 2006  entered into force , no Party has ever asked for the consultations to 
take place in the presence of a mediator. As the Agreement does not clearly prescribe if the final 
report of the mediator is to be made public, it is up to the Parties to decide  on the publication of the 
report. The final report of the mediator serves to facilitate the settlement of  possible dispute s among 
the Parties. Should a dispute not be settled on the basis of  the mediator report 's recommendation s, 
or by means of any other mutually agreeable solution through the  consultations, the Parties may 
refer the dispute  to arbitration.  
 
Disputes between the Parties , which have not been settled through direct consultations  in the 
Joint Committee  (including consultations which took place in the presence of a mediator ) within 90 
calendar days from  the date of receipt of the request for consultations , may be referred to arbitration 
by any Party. Article 43(3) of the CEFTA 2006 provides that the award of the Arbitral Tribunal is final 
and binding upon the Parties to the dispute. According to Article 43(4) of the CEFTA 2006, d isputes 
under consultation or arbitration under CEFTA are not to be submitted to the WTO for dispute 
settlement , nor shall an issue or a dispute pending before WTO dispute settlement procedures be 
submitted for arbitration under the CEFTA Agreement.  
 
Additional response from the delegations of Albania, Bosnia and Herzegovina, Kosovo, Montenegro, 
and Serbia : 
 
 The CEFTA Parties are currently considering to strengthen  the enforcement of CEFTA rules and 
making the existing CEFTA dispute settlement mechanism more effective. If any such developments 
were to o ccur, WTO Members would be informed accordingly .  
 
Additional response from the delegation of North Macedonia : 
 
 The CEFTA Parties are currently considering to strengthen  the enforcement of CEFTA rules and 
making the existing CEFTA dispute settlement procedures  more effective  with negotiations for 
                                                
3 If the Chair is a national or resident of one of the Parties concerned – then the first of his/her 
predecessors who is not will be selected.  WT/REG233/2  
 
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  dispute settlement mechanism . If any such developments were to occur, WTO Members would be 
informed accordingly.   
 
Questions fr om the delegation of Ecuador  
 
Provisions on trade in goods  
 
Rules of origin  
 
1.3.  Paragraph  3.24: "Annex II of the PEM Convention lists the working or processing 
required to be carried out on non -originating materials for the product to obtain 
originating statu s. The rules are generally chapter -specific with exceptions at the tariff 
heading level.  Origin is conferred according to four main criteria applied either 
independently or in combination with each other. These are: the "wholly obtained" 
criterion requiring that "all the materials of the chapter are wholly obtained"; the "change 
of tariff heading" criterion requiring non -originating materials to fall under headings other 
than that of the product; the import content test requiring the value of the no n-originating 
materials not to exceed a given percentage of the ex -works price of the product; and the 
technical test rule which sets out the working processes that non -originating materials 
have to undergo. In some instances, a combination of different ru les or choice between 
different rules is used ". 
 Regarding cumulation of origin and the import content test, what is the given 
percentage that imported components must not exceed for the end product to be 
considered as originating in the country in which i t was produced or assembled?  
 
Parties of the CEFTA Agreement express their gratitude to the delegation of Ecuador for the 
interest shown in the CEFTA Agreement.  
 
Response from the delegations of Albania, Kosovo, the Republic of Moldova, Montenegro, North 
Macedonia and Serbia : 
 
 The system of Pan -Euro-Mediterranean cumulation of origin allows for the application of 
diagonal cumulation between the EU, the EFTA States, Turkey, the Faroe Islands, the participants 
in the Barcelona Process, the participants in the EU's Stabilisation an d Association Process , and the 
Republic of Moldova. It is based on a network of Free Trade Agreements with identical origin 
protocols  which are being replaced by a reference to the Regional Convention on Pan-Euro-
Mediterranean preferential rules of origin (PEM Convention) . The Convention is published as Council 
Decision 2013/94/EU of 26 March 2012 on the conclusion of the Regional Convention on pan -Euro-
Mediterranean preferential rules of origin  in the Official Journal of the European Union (OJ L 54, 
26.2.2 013, p. 3 –158).  
 
 As noted in the Factual Presentation, Annex II of the PEM Convention lists the working or 
processing required to be carried out on non -originating materials for the product to obtain 
originating status.  Requirements regarding the minimum obligatory operations or processing 
required on non -originating goods, including the percentage that imported components must not 
exceed for the end product to be considered as originating in the country in which it was produced 
or assembled , differ from p roduct to product and are outlined in columns 3 and 4 of Annex II to the 
Origin Protocols.  
 
Response from the delegation of Bosnia and Herzegovina : 
 
According to the Title II Definition of the concept of "originating products " of the Appendix I 
The definition of the concept of "originating products " and methods of administrative cooperation of 
the PEM Convention, in cumulation of origin entirely origin ating materials are used. We first confirm 
if that good is not excluded from the cumulation according to the Free trade agreement in subject.  
 
If we are talking about sufficiently worked or processed products, we can use origin ating and 
non-originating mat erials. In this case, non -originating materials which, according to the conditions 
set out in the list in Annex II of Appendix I, should not be used in the manufacture of a product may 
nevertheless be used, when the set out conditions in PEM Convention are  fulfilled.  
 WT/REG233/2  
 
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  General provisions of the Agreement  
 
Other provisions  
Electronic commerce  
 
1.4.  Paragraph 4.47 states:  "The Parties agree to promote the development of electronic 
commerce between them, by cooperating on market access and regulatory issues raised 
by electronic commerce, recognizing that the use of electronic means increases trade 
opportunities in many sectors (Article 28) ". 
Do the countries have any joint methodology for recording information on transfers 
made through electronic commerce?  
 
Response from the delegations of Albania, Kosovo, the Republic of Moldova, Montenegro, North 
Macedonia and Serbia : 
 
 The CEFTA Parties do not have any joint methodology on e -commerce statistics. Based on 
Article 28 of the CEFTA 2006, the Parties are about to launch a dialogue on regulatory issues on 
e-commerce. The matter of statistics may be addressed within this dialogue.  
 
Response from the delegation of Bosnia and Herzegovina : 
 
 CEFTA  2006 Agreement regulates E -commerce only by Art 28. There is no t any joint 
methodology for recording information on transfers made through electronic commerce between 
CEFTA Parties.   
 
How are the companies that engage in electronic commerce in each countr y 
recorded?  
 
Response from the delegation of Albania : 
 
 Pursuant the law no. 10128 dated 11.05.2009 "On the electronic commerce ", service provider 
is a legal or natural person  whom operate in the field of the electronic commerce and does not need 
a specific licence or authorisation. These companies are registered in the National Business Centre 
in accordance with the law no.9901 dated 14.04.2008 "On companies and entrepreneurs ".  
 
Response from the delegation of Bosnia and Herzegovina : 
 
According to the Constitution of Bosnia and Herzegovina and the relevant laws of Bosnia and 
Herzegovina, the Entities and the Brčko District of BiH, the flow goods and services in BiH are free.  
 
Pursuant to the Decision on the Classification of Activities of Bosnia and Herzegovina 2010, 
the conduct of trade via the Internet was classified in the area G - Wholesale and retail trade; repair 
of motor vehicles and motorcycles, branches 47.9 Retail sal e not in stores, stalls or markets and 
class 47.91 - Retail sale via mail order houses or the Internet.  
 
If a legal or natural person carries out e -commerce on their own web site and is engaged in 
information service activities, such activity is classified  in branch 63.1 Data processing, hosting 
services and related activities; web portals, class 63.11 Data processing, hosting and related 
activities and 63.12 web portals.  
 
The laws of BiH, the Entities and the Brcko District of BiH laws stipulate that the s eller is 
obliged to make relevant information for customers available on the customer's website, which 
includes information about the seller, regulations, prices, conditions of sale, etc.  
 
The laws of the Entities of BiH and the Brcko District of BiH stipu late that e -commerce can 
only be organized by a duly registered merchant (at competent court or municipal office by the place 
of business) for that type of trade, whether it is exclusive or one of several activities that performs.  
 
There are no differences  in founding. A trader organized as a legal entity may commence its 
business activity, perform its business activities and change the conditions of its business when it 
registers with the registration court for conducting commercial activities in accordanc e with the law WT/REG233/2  
 
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  governing the registration of business entities, while a trader organized as an entrepreneur may 
commence business activities, to perform the activities and to change the conditions of its 
performance when it receives from the registration a uthority a decision on the registration of 
entrepreneurs in accordance with the law governing the performance of craft and entrepreneurial 
activities.  
 
Regulations governing e -commerce in Bosnia and Herzegovina:  
 
1. Law on Foreign Trade Policy of BiH ( "Official Gazette of BiH ", Nos. 7/98 and 35/04)  
2. Law on Electronic Legal and Business Traffic ( "Official Gazette of BiH ", No. 88/07)  
3. Law on Consumer Protection in Bosnia and Herzegovina ( "Official Gazette of BiH ", Nos. 
25/06 and 88/15)  
4. Law on Fiscal Systems ( "Official Gazette of BiH ", Nos. 22/16 and 48/18)  
5. Law on Internal Trade of the FBiH (( "Official Gazette of FBiH " No. 40/10)  
6. RS Law on Trade ("Official Gazette of the Republika Srpska", N os. 06/07, 52 / 11,67 / 
13 and 106/15)  
7. Law on Trade of the Brcko District of BiH ( "Official Gazette of the Brcko District of BiH ", 
Nos. 40/04 and 19/07)  
8. Relevant Rulebooks at Entity and Brcko District level of BiH  
 
Response from the delegation of Kosovo : 
 
Kosovo does not yet have the Law on Electronic Commerce. But law no. 04/L -094 on the 
Information Society Services partially treats electronic commerce. These companies are registered 
in the Kosovo Business Registration Agency in accordance with the Law no. 06/L-016 on Business 
Organizations.  
 
Response from the delegation of the Republic of Moldova : 
 
The companies that engage in the e -commerce in the Republic of Moldova are registered in 
conformity with the basic, general legal existent framework like any oth er legal entity dealing with 
any other type of economic activity. Thus, the state registration of legal entities, subsidiaries and 
representations shall be made in conformity with art. 2, art. 5, art. 7 -15 of law 220/2007, art. 55 -
67 of the Civil code of t he Republic of Moldova and article 9, Law 284/2004 on electronic commerce.  
 
The right to conduct electronic commerce is obtained from the moment of the legal registration 
in the State Registration Chamber of the legal entities or of the individual entrepreneur under the 
conditions of the Law no. 220/2007 regarding the state regist ration of legal entities and individual 
entrepreneurs (and under article 9, Law 284/2004 on electronic commerce).  
 
Additionally, it shall be mentioned that according to the legal framework, the right to work as 
a provider of services is not subject and li mited to the condition of obtaining of special permits or to 
comply with other requirements with equivalent effect.  
 
Response from the delegation of Montenegro : 
 
 The companies engaged in e -commerce in Montenegro are registered under  the usual 
procedure in accordance with the Company Law and Law on the classification of activities, on the 
basis of which this activity is classified within the  sector G: wholesale and retail trade. Namely, t here 
are sub-sectors within this sector, as fol lows:  
 
• 46.1 Wholesale trade, including a fee, which includes wholesale trade via the Internet and  
• 47.91 Retail sale via mail order houses or via the Internet.  
 
Response from the delegation of North Macedonia : 
 
 The e -commerce legal framework in North Maced onia is regulated  by the : 
• Law on Trade (OG RNM 16/04, 128/06, 63/07, 88/08, 159/08, 20/09, 99/09, 105/09, 
 115/10, 158/10, 36/11, 53/11, 148/13, 164/13,  97/15, 129/15 , 53/16 , 120/18 );  
• Law on Electronic Commerce ( OG RNM 133/07, 17/11, 04/15,192/15 ), Law for electronic 
 communications (OG RNM 39/14,188/14, 44/15,193/15) ;  WT/REG233/2  
 
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  • Law for services for quick transfer of money (OG RNM 77/03, 54/07, 48/10, 67/10, 17/11, 
 135/11, 187/13, 154/15);  
• Law for payments (OG RNM113/07, 22/08, 159/08,133/09, 145/10, 35/11, 11/12, 
 59/12,166/12,170/13, 153/15, 199/15, 193/17, 7/19);  
• Law on Data in Electronic Form and Electronic Signature  (OG RNM 34/01, 16/02, 98/08, 
 33/15), and other laws and bylaws.  
 At the Eleventh WTO Ministerial Conference in Buenos Aires (December 2017), recognizing 
the need to keep pace with the developments in the global economy, the Republic of North 
Macedonia co -sponsored the initiatives to continue work on e -commerce and on domestic regulation 
on services, as well as to create an info rmal Working Group on Micro, Small and Medium enterprises 
(MSMEs) at the WTO.4  
 
 The banks are offering e -banking services. E -commerce trading may be performed by legal 
entities and entrepreneurs. They are registering in one of commercial banks for performing 
e-commerce operations. The  registration procedure  is according the prescribed banking procedures 
and within this there is no difference compared to procedures for classic commercial activities.  
 
Response from the delegation of Serbia : 
 
 Pursuant  to the Law on Trade (OG RS, No. 52/19), trade (including e -commerce) may be 
performed by legal entities and entrepreneurs. They are registered by Business Registers Agency in 
accordance with the Law on Registration Procedure at the Agency for Business Ent ities (OG RS, 
No. 99/2011, 83/2014 and 31/2019). The  registration procedure is short and fast and there  is no 
difference to classic commerce.  
 
 Also, the Law on Electronic Commerce (OG RS, No. 41/2009, 95/2013 and 52/2019) provides 
that the information service provider is a legal or natural person. The provision of information 
services for commercial purposes (which may be e - commerce) may be perf ormed by a legal or 
natural person, who is registered to perform a particular activity in accordance with the Law.  
 
Questions from the delegation of Mexico  
 
Intellectual property rights  
 
1.5.  Paragraph 4.33  states : Does Article 39 of the Agreement contain an obligation 
distinct from the most -favoured nation treatment obligation under Article 4 of the TRIPS 
Agreement?  
Could the parties to the Agreement provide further information on the provisions of 
Part D, which are subject to the evolutionary clau se? 
 
Parties of the CEFTA Agreement thank the delegation of Mexico for the interest shown in the 
CEFTA Agreement.  
 
Response from the delegations of Albania, Bosnia and Herzegovina, Kosovo, Montenegro, the 
Republic of Moldova, North Macedonia  and Serbia : 
 
 Under CEFTA 2006, the CEFTA Parties undertook to conduct their mutual trade relations in 
accordance with the rules and disciplines of the WTO, and no provision of the Agreement may be 
interpreted as exempting the CEFTA Parties from their obligations under other international 
agreements, especially the WTO agreements.  
 Article 39 of the CEFTA 2006 regulates the possibility of extending the rights and obligations 
of the CEFTA Parties in case any CEFTA Party, after entry into force of this Agreement, should o ffer 
a third party additional advantages or preferences with regard to intellectual property rights beyond 
what has been agreed under Part D of Chapter  VI of the CEFTA 2006. It is recalled that out of the 
                                                
4 Joint Ministerial Statements, WT /MIN(17)/60, WT/MIN(17)/61, and WT/MIN(17)/58, respectively, all 
dated 13 Decemb er 2017.  WT/REG233/2  
 
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  current CEFTA Parties, only Albania, North Macedonia and Moldova5 were Members of the World 
Trade Organization at the moment when the CEFTA Agreement entered into force .  
 It is important to note that, until now, no CEFTA Party has ever asked for consultations in line 
with Article 39 of the CEFTA 2 006. Also, t here have been no developments with regard to Part D of 
Chapter VI o the CEFTA 2006. If any related development were to occur in the future, WTO Members 
would be informed accordingly.  
 Comprehensive information on Part D of Chapter VI of the C EFTA 2006 on 'Protection of 
Intellectual Propert y' (i.e., Articles 37 to 39 of the CEFTA 2006) is provided in paragraphs 4.31 and 
4.32 of the Factual Presentation. Most notably, according to Article 38(1) of the CEFTA 2006, the 
CEFTA Parties "shall grant a nd ensure adequate and effective protection of intellectual property 
rights in accordance with international standards, in particular with TRIPS, including effective means 
of enforcing such rights provided for in international conventions and treaties ". 
 
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5 Montenegro joined the WTO in 2012.