RESTRICTED  
  
G/STR/M/33  
 
9 July 2018  
(18-4303) Page: 1/7 
Working Party on State Trading Enterprises  Original: English  
 
MINUTES OF THE MEETI NG 
HELD ON 31 MAY 2018  
CHAIR: ANTONIUS YUDI  TRIANTORO  (INDONESIA)  
1   ADOPTION OF THE AGEN DA ................................ ................................ ........................  1 
2   REVIEW OF NEW AND FU LL NOTIFICATIONS SUB MITTED BY MEMBERS  .....................  1 
3   REVIEW OF NOTIFICATI ONS PREVIOUSLY REVIE WED BY THE WORKING 
PARTY  ................................ ................................ ................................ ..............................  3 
4   CONTINUED NON -NOTIFICA TION OF STATE TRADIN G ENTERPRISES BY THE  
RUSSIAN  FEDERATION  ................................ ................................ ................................ ..... 6 
5   CONTINUED NON -NOTIFICATION OF STAT E TRADING ENTERPRISE S BY THE 
UNITED ARAB EMIRATES  ................................ ................................ ................................ . 6 
6   NON-NOTIFICATION OF STAT E TRADING ENTERPRISE S BY CHINA  .............................  6 
7   NON-NOTIFICATION OF STATE TRADING ENTERPRISES BY THE PHILIPPINES  ...........  7 
8   OTHER BUSINESS  ................................ ................................ ................................ ........  7 
9   DATE OF NEXT MEETING ................................ ................................ ..............................  7 
 
1  ADOPTION OF THE AGEN DA 
1.  The Chair started the meeting by thanking the outgoing Chair, Rike Octaviana for her 
successful leadership in chairing the past meeting and wished her success. The Chair then referred 
to the proposed agenda contained in WTO/AIR/STR/8, circulated on 18 May 2018. Nothing was 
raised under Other Business.  
2.  The Working Party adopted  the agenda.  
2  REVIEW OF NEW AND FU LL NOTIFICATIONS SUB MITTED BY MEMBERS  
3.  The Chair  recalled t hat, according to paragraph 5 of the Understanding on the Interpretation of 
Article XVII of GATT 1994, the Working Party was tasked with reviewing the notifications and 
counter -notifications presented by Members on their State Trading Enterprises (STEs). A s 
recommended by the Working Party (G/STR/8) and agreed by the Council for Trade in Goods on 
22 June 2012, these new and full notifications were now presented every two years.  
4.  The last new and full notification covering the years 2014 and 2015 was due on 30 June 2016 
and a call for new and full notifications covering the years 2016 and 2017 was contained in 
document G/STR/N/17. This document provided that the deadline for new and full notifications 
covering this period was 30 June 2018. The Working Party h ad already reviewed a number of the 
notifications for 2016 during its meetings in October 2016, May  2017 and November 2017, and 
this meeting's agenda included 2016 notifications received since that time, as well as recently 
submitted notifications correspo nding to other periods.  
5.  The Chair proposed that the Working Party review the notifications in the same way as in 
previous meetings, focusing on two main elements: (i) whether the notification responded 
adequately to the information requested in the Questi onnaire (G/STR/3/Rev.1); and (ii) whether 
more information was required in order to permit, in  the language of paragraph 2 of the G/STR/M/33  
 
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  Understanding, "a clear appreciation of the manner of operation of the enterprises notified and the 
effect of their operations  on international trade".  
6.  The Chair recalled that, as provided in the Working Party's 1995 Report (G/L/35), Members 
wishing to raise questions on a notification under review were to present them in writing to the 
delegation and to the Secretariat three wee ks before the meeting. Replies were also to be 
presented in writing. Both questions and replies would be distributed to all Members.  
7.  No questions were raised regarding the notifications of Barbados  (G/STR/N/16/BRB), 
Burundi  (G/STR/N/17/BDI), El Salvador  (G/STR/N/17/SLV), Hong Kong, China  
(G/STR/N/17/HKG), Iceland (G/STR/N/6/ISL to G/STR/N/17/ISL), Israel  (G/STR/N/16/ISR), 
Macao, China  (G/STR/N/17/MAC), Mali (G/STR/N/17/MLI), the Former Yugoslav Republic of 
Macedonia  (G/STR/N/15/MKD/REV.2 and G/STR/N/16/MKD/REV.2), Nicaragua  
(G/STR/N/16/NIC and G/STR/N/17/NIC), Singapore  (G/STR/N/17/SGP), Switzerland  
(G/STR/N/17/CHE), and Thailand  (G/STR/N/17/THA).  
8.  Regarding the notification made by  New Zealand (G/STR/N/17/NZL), the r epresentative of the 
European Union  indicated that, although she did not have questions at this point, the 
European  Union intended to continue exchanging with New Zealand in the context of the 
Working  Party, in relation to the operations Zespri, a state tr ading enterprise specializing in kiwi 
fruits and would request that this notification be on the agenda of the next meeting. The 
representative of Chile said that his capital was currently reviewing the notification and would 
revert to it with questions. Th e representative of New Zealand  responded that his country looked 
forward to receiving the questions announced by the European Union and Chile.  
9.  Regarding the notification made by Norway  (G/STR/N/17/NOR), the European Union  recalled 
that it had posed quest ions about the government -owned alcoholic beverage retailer 
(Vinmomopolet). The European Union considered that the retail monopoly granted to this company 
made this company a state trading enterprise and asked why this company was not included in 
Norway's notification. The European Union also indicated that it had received a reply from Norway 
to its questions and that this reply was under review in Brussels. The representative of Norway  
indicated that since the full privatization of the producer in 2004, No rway did not maintain any 
state trading enterprise within the meaning of GATT Article XVII and the Understanding on the 
interpretation of GATT Article XVII. About Vinmonopolet, Norway indicated that it was a strict retail 
monopoly on sales of alcoholic bev erages which did not confer the right to produce or serve 
alcoholic beverages, nor the right to import alcoholic beverages, except for importation necessary 
to fulfil its obligation to offer beverages not in stock. According to Section 7.1 of the purchasin g 
regulation and the general purchasing rules for Vinmonopolet it had an obligation to offer 
beverages that it does not have in stock. This obligation gave consumers unlimited opportunity to 
acquire beverages and granted producers and importers of alcoholi c beverages full market access. 
In light of this, the level or direction of imports and exports was not influenced by Vinmonopolet's 
purchases or sales in the exercise of its exclusive or special rights or privileges. Hence Norway had 
not notified Vinmonop olet as a state trading enterprise.  
10.  Regarding the notification made by  the Kingdom of Saudi Arabia (G/STR/N/16/SAU and 
G/STR/N/17/SAU), the European Union  recalled that it had posed questions in writing to 
Saudi  Arabia. The European Union noted that accor ding to sources such as ICTSD or the 
South  Center, public stockholding programmes for food security purposes were in operation in 
Saudi Arabia, in the form of imports and/or stockpiling of cereals conducted by state trading 
agencies or authorized private c ompanies. The European Union asked why Saudi Arabia did not 
consider such enterprises (for example the Saudi General Grains Organization) as state trading 
enterprises in its notification. The representative of the Kingdom of Saudi Arabia  responded that 
the question had been forwarded to his capital and that a response would be provided at a later 
stage. The United States  took the floor to indicate that it shared the European Union's concern that 
such organizations as the Saudi General Grains Organization sh ould be notified and that it looked 
forward to Saudi Arabia's reply to the questions and to reviewing any revised notification if 
warranted. The Working Party took note  of the notifications, questions, answers and statements 
made.  
11.  The Chair drew the attention of delegations to document G/STR/19, which contains a Status 
of Notifications and noted that many, if not the majority, of Members were not fulfilling their 
notification obligations. Regarding the notification requirement for 2016, the Working Party had, to G/STR/M/33  
 
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  date, received notifications from just 50  Members. The Chair encouraged Members to work with 
their capitals to improve the notification record.  
12.  The United States  thanked the Chair for his initiative to encourage notifications and not ed that 
a number of Members had either failed to make any notification or had not done so for some time. 
According to the latest data circulated by the Secretariat, 38 Members had not made a notification 
in the last ten years. Transparency was an important  requirement for all WTO Members and 
notifications and counter -notifications were sometimes the only way that other Members could be 
properly informed of certain Members' activities in any given area. Low levels of compliance 
undermined the transparency fu nction of the Working Party. The United States also noted that if it 
were a matter of updating a notification, the notification process need not be cumbersome, as 
much of the information to be provided in the context of STE notifications had been provided and 
discussed in the Trade Policy Review process, in the WTO Committee on Agriculture, or had been 
otherwise provided to the WTO. The non -notification issue was a serious problem for the 
Working  Party and required some kind of action. The United States sup ported the Chair's initiative 
in this regard. The United States encouraged members to think creatively as to how compliance 
with notification requirements could be improved. The representative of the United States recalled 
that Document JOB/CTG/10/Rev.1 co ntained a proposal seeking to address the issue of missing 
notifications across a number of Committees. She said that although some Members had raised 
concerns with some aspects of the proposal, the interest for this proposal was growing and the 
United Sta tes had started to meet with interested Members.  
13.  The representative of the European Union  took the floor to echo the Chair's and United States 
delegation comments on the need to improve transparency. She said that the work of WTO 
committees made no sense w ithout transparency and she encouraged Members to submit their 
complete notifications and responses to questions asked by Members. She considered that more 
could be done in terms of both the timeliness and content of the notifications. The European Union 
recalled that there had been exchanges over the last years in the context of the Working Party on 
how to improve transparency and the European Union was open to discussing any creative idea on 
how to improve transparency.  
14.  The Working Party took note  of the statement made.  
3  REVIEW OF NOTIFICATI ONS PREVIOUSLY REVIE WED BY THE WORKING P ARTY  
15.  The Chair noted that this item concerned the review of notifications previously reviewed by 
the Working Party. Delegations had asked that the Working Party revert to three not ifications.  
16.  Regarding the notification of China  the United States had presented a second 
counter -notification (G/STR/Q1/CHN/9).  
17.  The representative of the United States  said that Paragraph 1 of the Understanding provided 
for a notification requirement for all WTO Members to ensure the transparency of the activities of 
STEs. Paragraph 4 of the Understanding stated that "any Member which has reason to believe that 
another Member has not adequately met its notification obligation may raise the matter with the 
Member concerned. If the matter is not satisfactorily resolved it may make a counter -notification 
to the Council for Trade in Goods, for consideration by the Working Party…" The representative of 
the United States recalled that this was the second counter -notification that the United States had 
had to make regarding China's state trading enterprises. Although China had stated that much of 
the information could not be provided because the information was "business secret", the 
United  States had conducted its  own research and noted that much of the missing information 
could be found in publicly -available information such as the website of the STEs. The United States 
indicated that it had raised the issue with China on multiple occasions in 2017 and that it had  to 
act as provided under paragraph 4 of the Understanding. The representative of the United States 
noted that, to date, China had not provided any information nor any response to the information 
contained in the second counter -notification of the United S tates. The representative called upon 
China to use the information provided in the counter -notification, to conduct its own due diligence 
and to provide the information that is normally required on a STE notification by all WTO Members.  
18.  The European Union  thanked the United States for the information contained in the counter -
notification and invited China to verify and if necessary to provide information on the entities G/STR/M/33  
 
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  mentioned in the counter -notification. The European Union indicated that, like last yea r, it was still 
interested in China's notification for 2016 and asked when China envisaged circulating it. The 
European Union recalled that it had made remarks on the content of the notification and in 
particular that each STE should be presented individua lly.    
19.  China  stated  that the notification of STEs was never  an easy task , because it required a lot of 
internal coordination and data collection and China believed that many Members shared the same 
views. In spite of this,  and in order to comply with WTO transparency commitments,  China had 
made a real effort and had submit ted a notification in 2015 , covering the period 2003 -2014 
including such information as the legal basis for state trading administration, the products covered 
and import and export volumes. China believed that Members had been well informed by this 
notification. For the time being it was technically impossible  for China  to present statistics 
separately for each STE , for the reasons stated at previous meetings : first, statistics pertaining to 
individual entities were their internal information and were considered as business secrets. 
Second, apart from the TRQs al located to STEs , the entities could also act as agents: therefore it is 
technically difficult to differentiate transactions conducted on their own or on behalf of other 
enterprises. Thus, t he information on the websites of the STEs or in their annual repor t could not 
serve as a basis for an official notifica tion. China wa s now working on the notification for the 
subsequent years and would try  to submit a notification  in the second half of 2018. Despite the 
technical difficulties, China was looking at the po ssibility of notifying the statistics separately for 
each STE in the future.  
20.  The United States  commented that it would have preferred to avoid making a second counter -
notification , but China had to be held accountable to the rules that all WTO Members must  follow. 
China was not the only Member to have not lived up to its  notification obligation. H owever, given 
the large role that state trading enterprises play ed in China's economy, and the distortive impact 
that these entities ha d on all WTO Members, it was  critical for China to be fully transparent about 
its STEs as required by its WTO obligations.  
21.  The Chair  invited the Working Party to take note  of the statements made.  
22.  Regarding the notification of India  (G/STR/N/14/IND), questions had been posed by Aust ralia 
(G/STR/Q1/IND/15) and by Canada (G/STR/Q1/IND/16).  
23.  The representative of Australia  said that Australia had raised a number of questions in writing 
on matters which had been  also addressed in other WTO committees, in particular in relation to 
the expo rt activities of India's STEs. He looked forward to receiving answers to those questions. 
Australia noted that the Food Corporation of India had confirmed that it had been exporting 
publicly held stocks of rice and wheat in the previous financial year desp ite India's repeated claim 
that it did not and had not been exporting publicly held stocks. Public stocks of both rice and 
wheat were rapidly growing in India, with another large crop currently under harvest and 
marketing, and Australia wanted to know how India intended to deal with its excess stocks and 
how it would ensure that subsidized stocks were not dumped onto world marke ts and that India's 
programmes we re not detrimentally impacting the food security of neighbouring countries. 
Australia also remaine d seriously concerned about quantitative restrictions imposed on imports of 
pulses, which had been recently expanded. India appeared to have a structural surplus of pulses 
and the resources of the Food Corporation of India and other associated entities had  been used to 
procure these excess stocks and to support India's domestic prices. This had impacted Australia's 
exports of pulses dramatically. The questions posed on pulses would help understand the activities 
of the Food Corporation of India and other bo dies in dealing with the current situation. In 
particular, Australia was interested in whether exports of publicly procured stocks of pulses had 
occurred. Australia expected all WTO Members to take their obligations seriously. Unfortunately, 
India had been  reluctant to provide full responses to questions on these issues in other WTO 
Committees. India's STE notification was now well out of date. According to information on the 
website of the Food Corporation of India as well as according to responses made to  questions in 
the context of the Working Party, it was clear that the Food Corporation of India was engaged in 
exports activities and Members needed to know the full extent of import and export privileges that 
India's STEs had been provided . The representa tive encouraged India to submit an updated 
notification as soon as possible.  
24.  The representative of the European Union  said that she subscribed to the questions posed by 
Australia and encouraged India to submit an updated STE notification because this had not G/STR/M/33  
 
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  happened since 2012. She noted that the issues raised by Australia had appeared both in this 
Working Party and in the context of  other WTO Committees and the European Union had itself 
asked clarifications on the operations of the Food Corporation of India before and had not received 
enough clarifications on the points raised. The European Union remained interested in additional 
information and clarifications on the export activities of the Food Corporation of India and statistics 
on grains which should be provided as part of the questionnaire on STEs. The European Union also 
had concerns with India's policy related to pulses and fur ther information from India would be 
welcome. Finally, the European Union recalled its concerns about the operations of TASMAC and 
indicated it would have further questions at the next meeting of the Working Party.  
25.  Canada  supported Australia's questions o n wheat and rice exports from stocks by the Food 
Corporation of India and was concerned with India's lack of transparency in the Working Party.  
26.  The United States  said it shared the concerns expressed by Australia, the European Union and 
Canada and was loo king forward to India's answers. The United States was particularly interested 
in hearing not only about direct exports made by the Food Corporation of India, but also about 
food stocks exports made by other Indian STE s.  
27.  With regard to Australia's first q uestion, India responded that in 2017 -2018, it had provided 
non-commercial humanitarian assistance consisting of 110,000 tons of wheat and 2 ,100 tons of 
rice coming from public stockholdings through the Ministry of External Affairs to Afghanistan, 
Zimbabwe , Namibia, Lesotho and Sri Lanka. In relation to Question 2, India indicated that the FCI 
was not an export STE and did not enjoy export privileges. On Question 3, the Government of 
India had not authorized the export of pulses procured on its behalf and t here had been no exports 
of publicly held stocks of pulses.  
28.  Canada  noted that since India's last notification in November 2012 , there had been 
developments related to India's STEs around the procurement, import and export of pulses. This 
included the Food Corporation of India, and other State trading corporations. Canada wanted to 
understand the role played by these STEs in the trade of pulses and was looking forward to the 
questions posed in writing. Canada also encouraged India to submit an updated STE no tification.   
29.  India indicated in response to Canada's first question that it was in the process of updating its 
STE notification. In relation to the second question, the representative of India indicated that there 
had been no exports of pulses from the pu blic stockholding. In response to question 4, India 
indicated that these agencies had no r ole in import quotas since there were no procedures notified 
by the office of DG FT. On the remaining questions , written replies would be submitted in due 
course.  
30.  The Chair  invited the Working Party to take note  of the statements made.  
31.  Regarding the notification of Viet Nam  (G/STR/N/15/VNM  - G/STR/N/16/VNM), the 
United  States  referred to its  follow -up questions in G/STR/Q1/VNM/3  and to its counter -notification 
in docu ment G/STR/Q1/VNM/4. The representative of the United States  indicated that the situation 
with Viet Nam  was similar to the one that members had heard earlier with regard to China. In June 
2016, the United States had submitted questions regarding Viet Nam 's first STE notification since 
accession. In those questions, the United States noted that only two entities had been identified by 
Viet Nam  as STEs, while 15 had been identified at the time of accession. In response, Viet Nam  
stated that the previously -identified STEs operated under market economy principles or had been 
re-organized to become subsidiaries of parent companies. Like with China, the United States had 
independently researched Viet Nam 's claims and the publicly -available information indicated th at 
there appeared to be a number of entities that Viet Nam  had failed to identify as STEs, and 
relevant information as to their import -export activities was rea dily available. Throughout 
2016-17, the United States had engaged in bilateral discussions in an  attempt to satisfactorily 
resolve the notification issue. But finally, the United States had to act, as provided under 
Paragraph 4 of the Understanding. The United States not ed that, like China, Viet Nam  had not 
provided any reply to the information conta ined in the United States' counter -notification, nor had 
it replied in writing to the follow -up questions submitted in November 2017. The United States 
called upon Viet Nam  to use the information provided in the counter -notification, to conduct its 
own due  diligence and to provide the information that was normally required in a ST E notification 
by WTO Members.  G/STR/M/33  
 
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  32.  The European Union  indicated that it found the information contained in the counter -
notification interesting and encouraged Viet Nam  to verify the in formation and , where necessary , 
to provide updates.  
33.  The representative of Viet N am indicated that work on the questions asked was still ongoing 
and that Viet Nam  hoped to submit responses before the next meeting of the Working Party.  
34.  The Working Party took note  of the statement s made.  
4  CONTINUED NON -NOTIFICATION OF STAT E TRADING ENTERPRISE S BY THE 
RUSSIAN  FEDERATION  
35.  The European Union  reiterated its concern with the lack of notifications of Russian STEs under 
GATT Article XVII. On the basis of replies submi tted by the Russian Federation at previous 
meetings of the Working Party and in the context of its Trade Policy Review, the European Union 
had understood that Russia granted exclusive rights to several companies, as established by the 
relevant orders of th e government of the Russian Federation. At the last meeting of the 
Working  Party, Russia had indicated that the preparation of the notifications was ongoing. The 
European Union regretted that Russia had not yet fulfilled its notification obligation and urg ed it to 
transform its announcements into concrete actions.  
36.  The United States  regretted that this was the seventh consecutive meeting that this topic was 
on the agenda and the sixth year that this issue had been raised in the Working Party. Russia had 
made an effort to meet its transparency commitments in other WTO bodies, but the United States 
regretted that this effort was not being exhibited in this Working Party. Russia had missed three 
consecutive notification cycles, or six years, as indicated in Secretariat document G/STR/17 of 
20 October 2017, and had not fulfilled a single STE notification since it had joined the WTO. This 
being said, the United States welcomed Russia's indication at the October 2016 meeting of the 
Working Party that companies had been granted the exclusive right to export liquefied natural gas. 
In addition,  the United States noted that according to a Presidential Decree from March 2009, 
JSC United Grain Company and its subsidiaries were state agents that conducted procurement and 
commodity interventions in the grain market, with mandates to increase (1) grai n export volumes, 
(2) the volume of grain purchases, and (3) sales on the domestic market. These entities all 
appeared to have elements and activities that fell under the working definition of a STE in the 
Understanding on the Interpretation of Article XVI I. The United States trusted that Russia would 
provide all the required information in its eventual notifications, both for the past six years and 
going forward. Russia had repeatedly stated in the Working Party that its STE notification was 
"nearly finali zed and would be submitted in the near future". Transparency was an important WTO 
requirement that Russia agreed to abide by when it joined the WTO. It allowed WTO Members to 
better understand and evaluate a Member's STE operations and its compliance with relevant 
WTO obligations. The United States urged Russia to fulfil its notification obligation as quickly as 
possible. It was willing to further engage with Russia either here in the Working Party, or outside 
the room if that would be helpful, on helping i t make its required  notification.  
37.  The representative of the Russian Federation  confirmed that the Russian Federation paid 
particular attention to its WTO commitments. He indicated that the preparation of the notification 
was in its final stage.  
38.  The Workin g Party took note  of the statements made.  
5  CONTINUED NON -NOTIFICATION OF STAT E TRADING ENTERPRISE S BY THE UNITED 
ARAB EMIRATES  
39.  The United States  noted that the delegation of the United Arab Emirates was not in the room 
and required that this item be carried  forward to the next meeting of the Working Party.  
6  NON-NOTIFICATION OF STAT E TRADING ENTERPRISE S BY CHINA  
40.  The representative of the United States  noted that China's last notification to the 
Working  Party had been made in 2015 and covered the period 2003 t o 2014. The United States 
recalled that it had already discussed the shortcomings of that notification, the actions it had had G/STR/M/33  
 
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  to take and the need for additional action to be taken by China. However, the United States noted 
that, in addition to not provid ing the additional information required for earlier notifications, China 
still had not made a notification covering the 2014 period forward, despite having a biennial 
obligation to do so. The United States was encouraged to hear that an updated notificatio n was in 
preparation and was looking forward to seeing it when available.   
41.  The representative of the European Union  noted two aspects of China's response under a 
previous agenda item, which she found encouraging: first, she took note that China was workin g 
on an updated notification to be submitted later this year; and second, that China was looking at 
the possibility of notifying STEs individually.  
42.  China  respond ed that it had submitted notification for the years 2003 to 2014 and that it was 
currently wor king on updated notifications covering subsequent  notification periods.    
43.  The Working Party took note  of the statements made.   
7  NON-NOTIFICATION OF STAT E TRADING ENTERPRISE S BY THE PHILIPPINES  
44.  The United States  noted that the Philippines had last made the r equired STE notification in 
2002, for the period covering 1998 -2001. The United States had attempted to reach out to the 
Philippines to discuss this issue, but it had not received a substantive response. Therefore, the 
United States was raising this issue to inquire as to when the Philippines would make the required 
notification to the Working Party for the period 2002 -2016, noting that the notification for the 
most recent period would be due as well at the end of June 2018.  
45.  Since the representative of the  Philippines was not present, the Working Party took note  of 
the statement made by the United States.  
8  OTHER BUSINESS  
46.  The Working Party took note  that no issue had been raised under other business.  
9  DATE OF NEXT MEETING  
47.  The Chair indicated that the Working Party was holding two meetings per year and interest 
had been expressed in continuing with this approach. The Chair proposed to hold the next meeting 
on 19 October 2018 . The draft annotated agenda would be circulated on 28 September 2018  
and the airgram  would be issued on 9 October 2018 . 
48.  The meeting was adjourned . 
__________