RESTRICTED  
  
G/C/M/132  
 
13 March 2019  
(19-1596) Page: 1/53 
Council for Trade in Goods    
 
MINUTES OF THE MEETI NG OF THE COUNCIL FO R TRADE IN GOODS  
3 AND 4 JULY 2018  
CHAIRPERSON: HE MR  STEPHEN CORNELIUS D E BOER  (CANADA)  
The meeting of the Council for Trade in Goods (CTG, or the Council) was convened by 
Airgram  WTO/AIR/CTG/11 and WTO/AIR/CTG/11/Add.1; the proposed agenda for the meeting was 
circulated in document  G/C/W/75 4 and G/C/W/75 4/Add.1.  The meeting proceeded on the basis of 
the following agenda : 
 
1   NOTIFICATI ON OF REGIONAL TRADE  AGREEMENTS  ................................ ....................  2 
2   PROPOSAL BY THE COMMITTEE ON REGIONA L TRADE AGREEMENTS ( CRTA) TO THE 
COUNCIL FOR TRADE IN  GOODS, T HE COUNCIL FOR TRADE  IN SERVICES, AND TH E 
COMMITTEE ON TRADE A ND DEVELOPMENT ON A TEMPLATE FOR NOTIFYI NG CHANGES 
TO AN EXISTING REGIO NAL TRADE AGREEMENT (WT/REG/28)  ................................ ...... 3 
3   ENLARGEMENT OF T HE EUROPEAN UNION: P ROCEDURES UNDER ARTI CLE XXVIII:3  
OF GATT  1994 – REQUE ST FROM THE EUROPEAN  UNION  ................................ .................  3 
4   KIMBERLEY PROCES S CERTIFICATION SCHE ME FOR ROUGH DIAMOND S – REQUEST 
FOR AN EXTENSION OF A WTO WAIVER – REQUE ST FROM THE EUROPEAN  UNION, AND 
AUSTRALIA, CAMBODIA,  CANADA, GUYANA, JAP AN, MALAYSIA, MAURIT IUS, NORWAY, 
RUSSIAN FE DERATION, SOUTH AFRI CA, SWITZERLAND, TUR KEY, UKRAINE, AND TH E 
UNITED STATES (G/C/W /753)  ................................ ................................ ........................  4 
5   JORDAN – REQUEST  FOR A WAIVER RELATI NG TO THE TRANSITIONAL PER IOD FOR 
THE ELIMINATION OF T HE EXPORT SUBSIDY PR OGRAM FOR JORDAN (G/ C/W/705; 
G/C/W/705/CORR.1; G/ C/W/705/REV.1; AND G /C/W/705/REV.2)  ..............................  5 
6   EUROPEAN UNION – QUALITY SCHEMES FOR  AGRICULTURAL PRODUC TS AND 
FOODSTUFFS – THE REG ISTRATION OF THE TER M "DANBO" AS GEOGRAP HICAL 
INDICATION – REQUEST  FROM THE UNITED STA TES AND URUGUAY  ...............................  6 
7   KINGDOM OF SAUDI  ARABIA, KINGDOM OF BAHRAIN, AND THE UNI TED ARAB 
EMIRATES – SELECTIVE  TAX ON CERTAIN IMPO RTED PRODUCTS – REQU EST FROM THE 
EUROPEAN UNION, SWIT ZERLAND, AND THE U NITED STATES  ................................ .........  8 
8   MEASURES TO ALLO W GRADUATED LDCS, WI TH GNP BELOW US$1000 , BENEFITS 
PURSUANT TO ANNEX  VII(B) OF THE AGREEMEN T ON SUBSIDIES AND  
COUNTERVAILING MEASU RES – COMMUNICATION FROM THE CENTRAL AFR ICAN 
REPUBLIC ON BEHALF O F THE LDC  GROUP (WT/ GC/W/742 – G/C/W/752 ) ....................  9 
9   MODIFICATION OF TARIFF CONCESSIONS A ND APPLICATION OF TA RIFFS HIGHER 
THAN THE LEVEL BOUND  IN HAITI'S SCHEDULE  XXVI – REQUEST FROM  THE 
DOMINICAN REPUBLIC  ................................ ................................ ................................ .. 12 
10   UNITED STATES – SECTION 232 INVESTI GATIONS AND MEASURES  – REQUEST  
FROM JAPAN AND THE R USSIAN FEDERATION  ................................ ...............................  14 
11   BAN ON THE OVER LAND EXPORT OF 23  PRODUCTS FROM THE DOMI NICAN  
REPUBLIC TO HAITI – REQUEST FROM THE DOM INICAN REPUBLIC  ...............................  18 
12   INDONESIA'S IMP ORT AND EXPORT RESTR ICTING POLICIES AND PRACTICES – 
REQUEST FROM THE EUR OPEAN UNION, JAPAN, AND THE UNITED STATE S ...................  19 G/C/M/132  
 
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  13   UNITED STATES – MEASURES RELATED TO  IMPORTS OF FISH AND  SEAFOOD 
PRODUCTS – REQUEST F ROM CHINA AND THE RU SSIAN FEDERATION  ..........................  22 
14   INDIA – CUSTOMS DUT IES ON ICT PRODUCTS – REQUEST FROM CANAD A, 
CHINA, THE EUROPEAN UNION, JAPAN, NORWAY , AND THE UNITED STA TES ................  24 
15   MONGOLIA – QUANTITATI VE RESTRICTIONS AND PROHIBITIONS ON  
IMPORTATION OF CERTA IN AGRICULTURAL PROD UCTS – REQUEST FROM THE 
RUSSIAN FEDERATION  ................................ ................................ ................................ ... 26 
16   EGYPT – MANUFAC TURER REGISTRATION S YSTEM – REQUEST FROM  THE 
EUROPEAN UNION  ................................ ................................ ................................ .........  27 
17   PAKISTAN – MEAS URES  RELATING TO SUGAR E XPORTS – REQUEST FRO M 
AUSTRALIA AND THAILA ND ................................ ................................ ...........................  28 
18   INDIA – MEASURE S RELATING TO SUGAR EXPORTS – REQUEST FR OM 
AUSTR ALIA AND THAILAND  ................................ ................................ ...........................  29 
19   CROATIA – REGUL ATION OF IMPORT AND SALE OF CERTAIN OIL PRODUCTS – 
REQUEST FROM THE RUS SIAN FEDERATION  ................................ ................................ .. 30 
20   VIET NAM – DECR EE ON THE REGULATION  ON CONDITIONS FOR A UTOMOBILES 
MANUFACTURING, ASSEM BLING, IMPORTING, AN D AUTOMOTIVE WARRANT Y AND 
MAINTENANCE SERVICES  – REQUEST FROM JAPA N AND THE UNITED STA TES ..............  31 
21   CHINA – MEASURE S RESTRICTING THE IM PORT OF SCRAP MATERI ALS – 
REQUEST FROM AUSTRALIA  AND THE UNITED STAT ES ................................ ..................  33 
22   INDIA – QUANTIT ATIVE RESTRICTIONS O N IMPORTS OF CERTAIN  PULSES – 
REQUEST FROM AUSTRALIA, CANADA, A ND THE UNITED STATES  ................................ .. 35 
23   CHINA – CUSTOMS  DUTIES ON CERTAIN I NTEGRATED CIRCUITS – REQUEST  
FROM THE EUROPEAN UN ION AND JAPAN  ................................ ................................ ..... 37 
24   CHINA – NEW EXP ORT CONTROL LAW IN D RAFT – REQUEST FROM THE 
EUROPEAN UNION AND J APAN  ................................ ................................ ......................  39 
25   THE RUSSIAN FED ERATION – TRADE REST RICTING PRACTICES – REQUEST  
FROM THE EUROPEAN UN ION ................................ ................................ ........................  40 
26   UNITED STATES – PROHIBITIVE PROPOSA L ON COMMUNICATION E QUIPMENT  
OR SERVICES RELEASED  BY THE FCC – REQUES T FROM CHINA  ................................ ...... 42 
27   IMPORT LEVY BY WTO MEMBERS OF THE A FRICAN UNION – REQUE ST FROM  
THE UNITED STATES  ................................ ................................ ................................ ...... 43 
28   UNITED STATES – MEASURES ON AVIATIO N SECURITY EQUIPMENT  – 
REQUEST FROM CHINA  ................................ ................................ ................................ ... 44 
29   WORK PROGRAMME ON ELECTRONIC COMMER CE ................................ ...................  45 
30   OTHER BUSINESS  ................................ ................................ ................................ .... 50 
30.1   European Union – Amendments to the Directive 2009/28/EC, Renewable Energy  
Directive – Request from Malaysia  ................................ ................................ ....................... 50 
30.2   Date of the next meeting  ................................ ................................ ........................... 53 
 
The Chairperson  informed delegati ons that , under Agenda item "Other Business ", he would raise the  
matter of the date of the Council 's next meeting.  
 
The agenda was so agreed . 
 
1  NOTIFICATION OF REGI ONAL TRADE AGREEMENT S 
1.1.  The Chairperson  recalled that, under the working procedures agreed by the Committee on 
Regional Trade Agreements (CRTA) , and following adoption by the General Council of the 
Transparency Mechanism, the CTG was to be kept informed of Members ' notifications of new regional  G/C/M/132  
 
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  trade agreements.1 He informed the CTG that there had been three  regional trade agreements 
notified to the Committee on Regional Trade Agreements:  
– Treaty on a Free Trade Area between Members of the Commonwealth of Independe nt 
States (CIS) (WT/REG343/N/3 ); 
 
– Free T rade Agreement between the EFTA  States and Georgia (WT/REG386/N/2) ; 
 
– Free Trade Agreement between China and Georgia (WT/REG391/N/1) . 
 
1.2.  The Chairperson  proposed that the Council take note of the information presented.  
1.3.  The Council so agreed . 
2  PROPOSAL BY THE COMM ITTEE ON REGIONAL TR ADE AGREEMENTS (CRTA) TO THE 
COUNCIL FOR TRADE IN  GOODS, THE COUNCIL FOR TRADE IN SERVICE S, AND THE 
COMMITTEE ON TRADE A ND DEVELOPMENT ON A TEMPLATE FOR NOTIFYI NG CHANGES TO 
AN EXISTING REGIONAL  TRADE AGREEMENT (WT /REG/28)  
2.1.  The Chairperson  drew Members ' attention to document  WT/REG/28 and the template 
reproduced in its annex to be used for notifications of changes to all existing RTAs. The document 
had been considered and adopted by the Committee on Regional Trade Agreements ( CRTA ), at its 
89th Session, on 19  June 2018, and had been recommended to the CTG, the Council for Trade in 
Services (CTS) , and the Committee on Trade and Development (CTD) , for adoption.  
2.2.  The delegate of Brazil  considered that it would be necess ary to reflect further on the template 
proposed by the CRTA. The CTD would also discuss the issue, and Brazil was for this reason not yet 
able to  approve the document in the CTG . Nevertheless, Brazil looked forward to continuing the 
discussion in the CTG a nd other fora.  
2.3.  The Chairperson  proposed that the Council take note of the statement made and agree to 
revert to th e matter at its meeting in November  2018. 
2.4.  The Council so agreed . 
3  ENLARGEMENT OF THE E UROPEAN UNION: PROCE DURES UNDER ARTICLE  XXVIII:3 OF 
GATT  1994 – REQUEST FROM THE EU ROPEAN UNION  
3.1.  The Chairperson  informed the Council that, in a communication dated  21 June 2018, the 
delegation of the European Union had requested the Secretariat to include this issue on the agenda.  
3.2.  The delegate of the European Un ion noted that negotiations following the EU  2013 enlargement 
had been finalized. The final agreement , with New Zealand,  would shortly be ratified by the European 
Parliament , and the EU  Council would conclude it  soon thereafter ; this would then lead, upon 
implementation,  to its entry into force. The EU would then submit an addendum to its notification of 
29 September  2017 on the corresponding final report on negotiation s under GATT  Article s XXIV:6 
and XXVIII.  
3.3.  The Chairperson  proposed that the Council take n ote of the statement made . 
3.4.  The Council so agreed . 
                                                
1 See documents  WT/REG16, WT/L/671, and G/C/M/88.  G/C/M/132  
 
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  4  KIMBERLEY PROCESS CE RTIFICATION SCHEME F OR ROUGH DIAMONDS – REQUEST FOR 
AN EXTENSION OF A WT O WAIVER – REQUEST FROM THE EU ROPEAN UNION, AND 
AUSTRALIA, CAMBODIA,  CANADA, GUYANA, JAP AN, MALAYSIA, MAURIT IUS, N ORWAY, 
RUSSIAN FEDERATION, SOUTH AFRICA, SWITZE RLAND, TURKEY, UKRAI NE, AND THE 
UNITED STATES (G/C/W /753)  
4.1.  The Chairperson  drew Members ' attention to  document  G/C/W/753, which had been submitted 
on 20  June 2018 by the European Union, and Australia, Cambodia,  Canada, Guyana, Japan, 
Malaysia, Mauritius, Norway, the Russian Federation, South Africa, Switzerland, Turkey, Ukraine, 
and the United States. The document contained a request and a draft decision for a six -year 
extension of the waiver of the Kimberley Pr ocess Certification Scheme for Rough Diamonds, effective 
1 January  2019, until 31  December  2024.  
4.2.  He recalled that, in May  2003, after consideration and approval by the CTG of a draft waiver 
decision, the General Council had adopted, in document  WT/L/518, a  waiver concerning the 
Kimberley Process Certification Scheme for Rough Diamonds, effective 1  January  2003, until 
31 December  2006. In December  2006, the General Council, after consideration and approval by 
the CTG of a draft waiver decision, had adopted i n document  WT/L/676, the extension of the said 
waiver, effective 1  January  2007, until 31  December  2012. Similarly, in December  2012, the 
General Council, after consideration and approval by the CTG of a draft waiver decision, adopted in 
document  WT/L/876,  had again extended  the said waiver , effective 1  January  2013, until 
31 December  2018.  
4.3.  The Chair also indicated that Sri Lanka and Brazil, in  communications dated 26  and 29  June, 
respectively, had both requested to be included in the list of countries anne xed to the Draft Decision.  
4.4.  The delegate of the European Union  said that the EU, together with other WTO co -sponsoring 
Members, were requesting the extension of this waiver until 31  December  2024, to allow each such 
Member to take or continue taking measures necessary to give effect to the trade restrictions relating 
to international trade in rough diamonds outlined in the Kimberley Process Certification Scheme.  
4.5.  The delegate of the Republic of Kore a said that her delegation supported the proposal , and 
again co -sponsored it as it had done previously, in 2003, 2006, and 2012.  
4.6.  The delegate of Sri Lanka  noted that the Kimberley Process Certification Scheme aimed to 
prevent conflict diamonds from enterin g the legitimate diamond trade, and that it played an 
important role in the process of economic growth and overall development of many countries, 
including various developing countries. At present, the Scheme had evolved into an effective 
mechanism , which  was recognized as a unique conflict prevention instrument promoting peace and 
security. In Sri Lanka, the export and import of rough diamonds were monitored by the National 
Gems and Jewellery Authority and Sri Lanka Customs. All imports into the country of rough diamonds 
had to be accompanied by a valid Kimberley Process Certificate , and it was also essential to obtain 
a licence from the National Gems and Jewellery Authority.  
4.7.  In addition, all re -export of finished products should be accompanied by a valid c ertificate 
issued by the National Gems and Jewellery Authority to the effect that such diamonds came from 
consignments that had been brought into the country in accordance with the provisions of the 
Kimberley Process Certification Scheme . As a founding Mem ber of that process, Sri Lanka wished to 
join the EU and other co -sponsors in their request for an extension of the waiver.  
4.8.  The delegate of Brazil confirmed Brazil 's support for the waiver request, and its willingness to 
be included in the Annex to the Dra ft Decision containing a list of waiver beneficiaries.  
4.9.  The delegate of India said that, as a member of the Kimberley Process Certification Scheme, 
India wished to co -sponsor the proposal and to be included in the Annex to the Draft Decision.  
4.10.   The delegate o f Singapore  said that his delegation supported the request for the waiver 's 
extension considering  the important role the Kimberley Process Certification Scheme played in 
breaking the link between trade in rough diamonds  and armed conflict . Singapore wished to be 
included in the annex to the draft waiver.  G/C/M/132  
 
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  4.11.   The delegate of Kazakhstan  registered his delegation 's support for the waiver extension  and 
co-sponsored the request.  
4.12.   The delegate of Panama  requested for Panama to be added to the list of  co-sponsors of the 
Kimberley Process waiver.  
4.13.   The Chairperson  reminded Members that the waiver also applied to measures implementing 
the Kimberley Process Certification Scheme taken by any Member not listed in the Annex to the 
Decision that desired to be c overed by the present waiver , and that n otified the CTG  accordingly or 
that had already done so pursuant to the existing waiver.  
4.14.   He proposed that the Council take note of the request contained in document  G/C/W/753 and 
of the statements made. He also propo sed that the Council agree to forward the Draft Waiver 
Decision contained in document  G/C/W/753 to the General Council for adoption, and to include in 
the Annex the Republic of Korea, Sri Lanka, Brazil, India, Singapore, Kazakhstan, and Panama.  
4.15.   The Council so agreed . 
5  JORDAN – REQUEST FOR A WAIVE R RELATING TO THE TR ANSITIONAL PERIOD FO R THE 
ELIMINATION OF THE E XPORT SUBSIDY PROGRA M FOR JORDAN (G/C/W/ 705; 
G/C/W/705/CORR.1; G/ C/W/705/REV.1; AND G /C/W/705/REV.2)  
5.1.  The Chairperson  drew Members ' attentio n to document  G/C/W/705/Rev.2 , containing both a 
waiver request and a draft waiver decision , submitted by Jordan in respect of the transitional period 
for the elimination of the export subsidy programme for Jordan. As agreed at the CTG  meeting of 
28 March  2018, he invited Jordan to update Members on any developments . 
5.2.  The representative  of Jordan  said that Jordan 's new WTO -compliant programme was in the 
legislative process to be incorporated in the Income Tax Law as of 1  January  2019, in line with the 
timetable for implementing a new programme established  in document  G/C/W/705/Rev.2. Jordan 
was also amending the 2014  Income and Sales Tax Law No.  34 to make it  compatible with Jordan 's 
commitments under the SCM  Agreement. It was also committed to terminating the existing subsidy 
programme by end –2018, in accordance with Regulation No.  106 of 2016, which stipulated that 
income f rom exports of local origin was totally exempted from tax only until 31  December  2018.  
Jordan had recently submitted for circulation its final notification to the Committee on Subsidies and 
Countervailing Measures (SCM)  regarding its existing subsidy progr amme. His delegation requested 
that the item remain  on the Council 's agenda.  
5.3.  The delegate of the United States  thanked and congratulated Jordan for its comprehensive 
report on reform efforts undertaken for the approval of its subsidies replacement programm e. The 
US looked forward to the termination of the support programme at issue and to implementation of 
the new programme in accordance with the schedule Jordan had reviewed with them.  
5.4.  The delegate of New Zealand  expressed his delegation 's appreciation for Jordan 's commitment 
to keeping the Council updated and to bringing their policy into conformity with the Subsidies 
Agreement.  
5.5.  The delegate of Australia  thanked Jordan for its update and expressed appreciation for Jordan 's 
transparency and constructive appr oach.  
5.6.  The delegate of Japan  expressed appreciation for Jordan 's comprehensive update. Japan would 
continue to monitor the issue  closely . 
5.7.  The representative  of Jordan  thanked previous delegations for their interest in Jordan 's subsidy 
programme and  indicated that her  delegation was willing to follow up with them if they had additional 
questions . She asked the Council to revert to this issue at its next meeting . 
5.8.  The Chairperson  proposed that the Council take note of the statements made and agree to 
revert to the matter at its next meeting.  
5.9.  The Council so agreed . G/C/M/132  
 
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  6  EUROPEAN UNION – QUALITY SCHEMES FOR  AGRICULTURAL PRODUC TS AND 
FOODSTUFFS – THE REGISTRATION OF  THE TERM "DANBO " AS GEOGRAPHICAL 
INDICATION – REQUEST FROM THE UN ITED STATES AND URUG UAY 
6.1.  The Chairperson  informed the Council that , in communications dated 13 and 21  June 2018, the 
delegations of Uruguay and the United States, respectively, had requested the Secretariat to include 
this item on the agenda . 
6.2.  The delegate of Uruguay  regretted to have to raise this issue at the Goods Council , but despite 
attempts to solve the matter at the TBT  Committee and in Brussels, concerns remained. As explained 
in documents  G/TBT/W/469 and G/TBT/W/543, in 2012 the Danish Government had submitted to 
the EU  authoritie s an application to register the terms "Danbo " and "Havarti " as geographical 
indications (GIs). Uruguay and other countries had argued that both terms were generic and 
therefore could not be registered as GIs and limited in their use.  
6.3.  Both applications had remained "pending " over several years and this had created legal 
uncertainty for producers and importers of Danbo cheese. Despite several requests to the EU at the 
TBT Committee to inform Members about the registration of such terms, the EU had limited  its 
response to commenting only that there was no thing to report. However, on 19  Octob er 2017, and 
without prior notice from the EU, Uruguay had noted the publication in the EU  Official Gazette of 
EU Directive  2017/1901 registering the term "Danbo " as a G I, which in Uruguay 's view  constituted 
a lack of transparency in its regard.  
6.4.  Codex Stan  264 had been approved in 1966 and updated on several  occasions , with 
EU approval. This standard, in Item  7.1 on labelling, clearly set out that the name "Danbo " could b e 
applied in accordance with Section  4.1 of the General Standard for the Labelling of Pre -Packaged 
Foods (Codex Standard  1/1985), provided that the product was in conformity with such standard. 
Additionally, Item  7.2 of Standard  264 set out that the countr y of origin, namely,  the country of 
manufacture, and not the country in which the name originated, should be declared. The general ly 
accepted  interpretation of Item  7 was that Members acknowledged "Danbo " as a generic term that 
could be produced in different regions as long as it met the requirements set out in the standard.  
6.5.  The findings of the panel in case EC – Sardines (DS231 ), had found that a Codex standard was  
a relevant international standard in lin e with Article  2.4 of the TBT  Agreement and therefore could 
be used as a basis for the elaboration of Members ' technical regulations. According to point  8 of 
EU Regulation  2017/1901, which granted the protection and registration of the term "Danbo " as a 
GI, in the present case the EU had n ot used the specific Codex Stan  264 as it s basis for registration 
of the term "Danbo ". 
6.6.  The measure as set out , and without considering any other option than "Danbo from Denmark ", 
was not only an unjustified barrier to trad e but also raised many  questions with regard to the use of 
international reference standards at the WTO, such as those of the Codex Alimentarius . From a 
systemic point of view, it was alarming that a WTO  Member would decide to ignore Codex 
Alimentarius  standards ; the EU could also have pursued  alternative solutions to meet its objective 
without the creation of unnecessary barriers to trade.  
6.7.  Finally, since March  2017, the EU had continued to claim in the TBT  Committee that the 
question should be addressed exclusively from the perspective  of intellectual property rights, and 
therefore should not be addressed in the TBT  Committee. The EU  delegation had forgotten that the 
Standard under which those rights were granted had been notified to the TBT  Committee by th e 
EU itself, on 18  November  2013, under Notification  G/TBT/N/EU/139.  
6.8.  Therefore, in accordance with the TBT  Agreement itself , and the findings of panels and the 
Appellate Body, Uruguay believed that the measure was not an intellectual property is sue but was 
relevant to the TBT  Committee, contrary to the EU 's claims. She therefore urged the EU to review 
the measure and to consider alternatives that would achieve the desired objective without creating  
unnecessary barriers to trade.  
6.9.  The delegate of the United S tates said that her authorities remained concerned by the 
registration of the term "Danbo " as a protected GI , completely disregarding an existing international 
Codex standard. The bilateral consultation process with the EU on the matter had been G/C/M/132  
 
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  unsatisfac tory, including a lack of responsiveness to their requests at the TBT  Committee for clarity. 
The registration lacked sufficient transparency, such as an explanation as to how the EU viewed  
existing Codex standards.  
6.10.   The US was also opposed to the EU grantin g GI protection for Havarti considering  the 
international Codex Alimentarius  standard for Havarti, which Codex members, including the EU, had 
reconfirmed in 2007, 2008, and 2010.  Additionally, this application also lacked transparenc y and 
required a status  update.  
6.11.   The EU Council 's own decision , upon the EU 's accession to the Codex Alimentarius  
Commission , affirmed that "Codex standards have acquired increased legal relevance by virtue of 
the reference made to Codex in the WTO  Agreements and the presumption of conformity which is 
conferred on national measures when they are based on such standards ". The EU and its member 
States had also supported and agreed to the Codex Committee on Milk and Milk Products ' individual 
cheese standards, which contained labellin g provisions, under Section  7, which preserved the 
generic nature and use of the names of those cheeses.  
6.12.   The terms "Danbo " and "Havarti " had undergone rigorous review to prove their use in the 
public domain and international trade , which indicate d a need for clarification as to whether or not 
the EU 's view of the legal relevance of Codex standards had changed since the publication of the 
Council 's Decision.  
6.13.   The delegate of New Zealand  endorsed the previous statements and emphasized the centrality 
of the standard -setting bodies, and the FAO  Codex Alimentarius  in particular . The nature of the  
decision taken by the EU went against its previous statements and good faith in that Organization. 
Moreover, the EU had helped to update the standard for "Danbo ", most recently in 2010 , and had 
admitted that the existence of the country of origin statement in the standard underscored the 
generic nature of that cheese, as would also be the case for Havarti.  
6.14.   Producers in many countries had invested in producing and m arketing "Danbo " cheese under 
the legitimate expectation that they were entitled to use this term; and they were no doubt 
encouraged , too,  by the Danish and EU  authorities , which continued to assert the term 's generic 
nature. For example, as recently as 20 08, the Danish dairy board  had explicitly recognized that 
"Danbo " was a generic term.  
6.15.   "Danbo " cheese had been produced in New Zealand. In addition to New Zealand, national 
standards existed in nine  different countries, including in several  developing countries , such as 
Uruguay, Argentina,  and Kenya. The Danish Development Agency had assisted developing countries 
with the production of "Havarti " and "Danbo " cheese. The EU  measure was an abrogation in a trading 
environment in which existing e conomic operators had legitimate expectations to produce an export. 
There were other options available to the EU, such as "Danbo Denmark ", which they had chosen not 
to use. New Zealand requested the EU to provide a status update on the Havarti GI  applicati on, and 
urged the EU to reconsider its position on "Danbo ". 
6.16.   The delegate of  Argentina  echoed previous interventions. The registration of the term "Danbo " 
as a GI for Denmark did not take into consideration the international Codex standards, and the 
consult ation process for the registration also lacked transparency. The term "Danbo " could not be 
registered as a GI and nor could its use be limited in any way.  
6.17.   The delegate of the European Union  said that the procedures for granting protection of the 
term "Danbo " as a GI in the EU had been finalized and were contained in Com mission Implementing 
Regulation  EU2017/1901 of 18  October  2017, which was publicly available. As stated in 
TBT Committee meetings, any issues strictly concerning intellectual property rights should be 
discussed in the appropriate fora, notably, the TRIPS  Council. The Application for the registration of 
Havarti cheese as a geographical indication was u nder assessment by EU  services.  
6.18.   The Chairperson  proposed that the Council take note of the statements  made . 
6.19.   The Council so agreed . G/C/M/132  
 
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  7  KINGDOM OF SAUDI ARA BIA, KINGDOM OF BAHR AIN, AND THE UNITED ARAB 
EMIRATES – SELECTIVE TAX O N CERTAIN IMPORTED P RODUCTS – REQUEST FROM THE 
EUROPEAN UNION, SWIT ZERLAND, AND THE UNI TED STATES  
7.1.  The Chairperson  informed  Members that, in communications dated 21  June 2018, the 
delegations of the European Union , Switzerland, and the United States , respec tively, had requested 
the Secretariat to in clude this item on the agenda.  
7.2.  The delegate of the European Union  said that the EU was concerned about the selective tax on 
energy drinks, carbonated soft drinks, and tobacco products, which had been implemented b y the 
Kingdom of Saudi Arabia, the United Arab Emirates, and the Kingdom of Bahrain, in 2017. The 
selective tax had been implemented at 100% on energy drinks and tobacco, and 50% on carbonated 
soft drinks.  
7.3.  The EU had not received any convincing evidence nor scientific justification of the product 
selection , nor any indications that the measure would be notified to the WTO. The negative impact 
had been greater on importer s than on domestic producers.  
7.4.  Saudi Arabia, the United Arab Emirates , and Bahrain should  indicate their rationale for targeting 
only carbonated soft drinks, with and without sugar, as well as energy drinks. Many non -carbonated 
sugary drinks not subject to the tax had a much higher sugar content than those products that were 
covered by the sel ective tax.  
7.5.  There were a number of questions to be answered . For example, if the intention  of the measure 
was to reduce sugar intake, what was the scientific rationale behind taxing carbonated soft drinks 
with almost no sugar content , and excluding many  domestically available products that contained 
similar or even higher amounts of sugar? Had the use of an ad valorem  excise tax instead of a tax 
based on the volume or quantity of the relevant ingredients been recommended by the World Health 
Organization (WHO)? Would the tax  rates of 100%, and 50% be reduced , given that they exceeded 
the WHO 's recommendations for such selective taxes?  
7.6.  The EU looked forward to receiving responses from the countries concerned and would continue 
to engage with them constructi vely with a view to resolving the issue.  
7.7.  The delegate of Switzerland  said that Switzerland shared the legitimate objective of such a tax 
but was concerned about its design and implementation. Despite discussions with GCC  members in 
search of clarification of the tax at issue , concerns remained regarding its unusual ly high rate and 
implementation. No clear explanation nor scientific basis had been provided to justify  the imposition 
of a tax rate that was twice as high for energy drinks as for carbonated soft  drinks that, in certain 
instances, contained far more sugar than the energy drinks themselves. For exporters, the effect 
was clear: the consumption of imported energy drinks had fallen by half and consumers had shifted 
to cheaper sugar -containing drinks , which had showed no reduction in rate of consumption. This was 
a clear indication of the discriminatory effect of the ad valorem  tax. 
7.8.  When imposing a 100% ad valorem  tax on tobacco products,  100% on energy drinks, and 
50% on carbonated soft drinks, GCC members seemed no t to have followed WHO  recommendations 
regarding fiscal policies for diets and prevention of non -communicable diseases, which 
recommended to use a specific excise tax based on either the sugar content or the volume of a 
drink. Such a t ax, as opposed to a tax based on percentage of price, was the most effective way to 
achieve the goal of protecting the population 's health. A specific tax based on sugar content or 
volume was likely to be the most effective approach as it would reduce ince ntives for consumers to  
revert to cheaper products.  
7.9.  Switzerland encouraged the GCC  finance minist ers at their meeting in October  2018 to make 
modifications to the tax , in line with WHO  recommendations , which would not discriminate between 
locally  produced and imported products that contained similar quantities of sugar. Switzerland also 
requested to be regularly informed of any developments, and to receive further details regarding 
the possible future application of a selective tax to other sugar -containing  products, as well as to 
luxury goods.  G/C/M/132  
 
- 9 - 
 
  7.10.   The delegate of the United States  supported the efforts made by Saudi Arabia, the United 
Arab Emirates, and Bahrain,  to prevent and control non -communicable diseases , but expressed 
concern over the imposition of taxes  on US  companies that sold carbonated beverages with both 
sugar and other sweeteners. She encouraged the Members concerned to repeal the tax and instead 
to apply measures known to achieve  better results than regressive taxes; and she also called upon 
other  GCC member states not to implement such a tax. Instead, they should develop evidence -based 
measures that targeted improving public health outcomes.  
7.11.   The US considered the measures being implemented to be overly broad in certain respects 
and arbitrary in ot hers, since they applied to diet beverages but not to other non -carbonated 
sweetened beverages. While food and beverage taxation might create shifts in consumer purchasing 
patterns, taxation had never been shown to improve public health outcomes.  
7.12.   The deleg ate of the Kingdom of Bahrain , speaking on behalf of Bahrain, Saudi Arabia, and the 
United Arab Emirates, indicated that the main objective of the Excise Tax measures concerned the 
protection of human health and the environment , but not the pr otection of d omestic industry. The 
Excise Tax measures were fully compliant with GATT  Article  III as they were imposed on both 
domestic and imported products and were not intended to protect local industry. The Excise Tax 
measures were not applied to imported products at a higher or discriminatory rate than that imposed 
on domestic products , and nor did they confer any preferential treatment to domestically produced 
products ; they were therefore fully in accordance with th e principle of national treatment . 
7.13.   The three cou ntries stood ready to engage with any other interested Member to provide any 
requested additional clarification of the GCC  Common Agreement on Excise Tax.  
7.14.   The Chairperson  proposed that the Council take note of the statements made.  
7.15.   The Council so agreed . 
8  MEASURES TO ALLOW GR ADUATED LDC s, WITH GNP BELOW US$ 1000, BENEFITS 
PURSUANT TO ANNEX  VII(B) OF THE AGREEM ENT ON SUBSIDIES AND  COUNTERVAILING 
MEASURES – COMMUNICATION FROM THE CENTRAL AFRICAN REPUBLIC ON BEHALF O F 
THE LDC  GROUP (WT/GC/W/742 – G/C/W/752)  
8.1.  The Chairperson  reminded Members that, in a communication dated 13  June 2018, the 
delegation of the Central African Republic, on behalf of the LDC  Group, had requested the Secretariat 
to include this item on the agenda.  
8.2.  The representative of the Central Afric an Republic , on behalf of the LDCs, highlighted the 
importance of the request made by their Ministers of Trade in the Declaration adopted at MC11 to 
correct a technical oversight relating to Annex  VII of the Agreement on Subsidies and Countervailing 
Measur es (SCM  Agreement ). The proposal, submitted on 19  April 2018, in document  WT/GC/W/742 
– G/C/W/752, contained a request and a draft decision to be adopted by the General Council 
concerning the possibility for graduated LDC  Members to benefit from the except ion provided under 
Article  27.2(a) of the SCM  Agreement to developing countries listed in Annex  VII(b).  This would 
facilitate a smoother integration into the global economy for graduated LDC  Members , and would 
also support the goals of the Istanbul Program me of Action for LDCs for 2011-2020. The proposal 
referred to the possibility for recently graduated LDCs to continue to benefit from this flexibility 
provided that their GNP per capita remained below US$1,000, an issue that was not clear in the 
2001 Doha Decision on Implementation. In contrast, it did seem  clear that graduated LDCs should 
benefit, like developing countries, from the exception provided to Members unde r Annex  7 of the 
SCM Agreement.  
8.3.  The LDCs asked Members to accept their proposal and to transmit the draft decision on 
graduation to the General Council for  adoption at its next meeting.  
8.4.  The delegate of Nepal  joined the previous statement and indicated that the Doha Declaration 
had also emphasized the need for implementation of the provision s of Article  27.2 and Annex  VII(b) 
of the SCM  Agreement. Graduating LDCs might have to relinquish several international support 
mechanisms  upon graduation,  including duty-free quota -free (DFQF ) and preferential market access, 
preferential rules of origin, the LDC services waiver, and aid for trade, among others. It would be an G/C/M/132  
 
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  injustice if the generally accepted principle on the application of flexibilities for graduating LDCs were 
not applied. Several developing countries had been beneficiaries of Annex  7 of the SCM  Agreement 
when they had achieved less than US$1,000 in income in 1990  constant price s. 
8.5.  Graduation was a continuous process of socio -economic development for a country; therefore , 
it was important to emphasize sustainable graduation. The LDC  propo sal was relevant and could 
support achievement of the legitimate development objectives of graduating LDCs ; nor did it seek 
any amendment to the SCM  Agreement.  
8.6.  The delegate of Bangladesh , on behalf of his Ambassador , said that Bangladesh echoed the 
stateme nts made by previous delegations. The  issue of  LDC Graduation had received momentum 
after adoption of the Istanbul Plan of Action for LDCs by the United Nations, wherein a target was 
set to enable half of all LDCs to meet the graduation criteria by 2020. U NCTAD had projected that 
16 LDCs were likely to graduate from LDC  status by 2024.  
8.7.  The proposed revision would bring clarity to Annex  VII of the SCM  Agreement by addressing 
the concerns of graduated LDCs , allowing them to benefit from  the flexibilities cont ained therein. 
The revision did not envisage these flexibilities being extended to all graduated LDCs . Nor did it 
foresee that those graduated LDCs enjoying the possibility of such flexibilities  would automatically 
use them; rather, they would turn to them only when necessary , a matter dependent largely upon 
availability of resources.  
8.8.  The representative of Chad supported the statement made by the LDC  Coordinator. The LDCs 
had always shown flexibility and open -mindedness. They had expressed their willingness to move 
forward on this issue and had always believed in negotiation as the way to reach consensus or 
compromise. LDCs were in a very vulnerable position ; they faced specific structural challenges that 
preve nted them from integrating fully into global trade flows. The LDC proposal was intended to 
accelerate  and to improve their integration, given the LDCs' very low level of global t rade in terms 
of market share , at just 1% . 
8.9.  Certain LDCs had specific needs and  challenges that hampered their access to global markets, 
including those linked , in some cases,  to a landlocked geographical location. Taking such important 
challenges into consideration, LDCs had made considerable efforts to graduate out of their 
LDC category, not least because no country wished to be categorized as an LDC – an uncomfortable 
position.  
8.10.   The aim of the proposal suggested by LDC  Ministers of Trade at MC11 was to allow graduated 
LDCs to continue for a certain period  to benefit from the flexibilities provided under Article  27.2 of 
the SCM  Agreement on the exemption from the provision of export subsidies, provided that the 
GNP per capita of the country remained below US$1,000. The progress made by LDCs towards 
graduation had led t o this proposal because LDCs wanted the WTO to correct a technical oversight 
and enable graduated LDCs to benefit from Annex  VII if their GNP per capita again fell below 
US$1,000. The Decision did not introduce any new concept . 
8.11.   The delegate of Brazil  expre ssed his delegation 's support for the draft decision and its 
submission to the General Council for adoption.  
8.12.   The delegate of the United States  thanked the LDC  Group for the opportunity to discuss the 
proposal but questioned the need to change the rules in this area, particularly as the UN  process 
already provided for a rather lengthy transition out of the LDC  category, including possible 
extensions. The specific need for the proposal was also unclear as there did not appear to be export 
subsidy programmes i n place for which an extension might be needed. To continue to discuss the 
matter in a meaningful way , the US considered that  it would be helpful if the relevant Members could 
provide a subsidy notification to clarify the issue. The US also stood ready and willing to share its 
experience and technical knowledge, should any technical assistance  be required.  
8.13.   The delegate of Norway  said that his delegation saw some merit in the proposal but required 
more time to study it.  
8.14.   The delegate of the European Union  reiterated the EU 's readiness to engage constructively on 
development issues, particularly those concerning LDCs , but to do so based on  analysis that clearly G/C/M/132  
 
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  explained where the specific problems  were, and which  justifi ed specific courses of action. 
Developing countries , and LDCs in particular , should have access to flexibilities  that would , in general 
terms, help them to achieve their development objective s; however , such flexibilities should be 
needs -driven and evidence -based. At this stage , the EU could not agree to any more general 
automatic exemption for all developing countries from existing rules and considered that, in the 
meantime, the countries concerned should seek assistance in reshaping any export subsidies to 
adapt them and make them fully WTO-compatible. In addition, the EU noted that graduated LDCs 
would remain on the list of Annex  VII(b) until their GNP per capita reached US$1,000 in constant 
1990 dollars for three  consecutive years.  
8.15.   The EU asked if , once that condition was met, the pro vision of Article  27.2(b) of the 
SCM Agreement would still apply to graduated LDCs, thereby allowing them to grant export subsidies 
for eight years after leaving  the list?  
8.16.   The delegate of Switzerland  welcomed the proposal and shared the concerns expressed by 
LDCs. Even though the proposal 's intention  was to correct an overs ight in Annex  VII(b) to the 
SCM Agreement, Switzerland required more time to consider  the details of the request  and, in 
particular , to consider the process to follow for possible  amend ment to  the annex es to the 
SCM Agreement , and the possible implications  thereof . Like other s, Switzerland had questions about  
the real need for a ministerial decision for such an amendment, and about  which LDCs would benefit 
from such an exemption, current ly or soon. 
8.17.   The delegate of Japan  highlighted the importance of the issues relating to graduation from 
the LDC  category and indicated that LDCs should be supported by the international community in 
navigating smoothly  the process of grad uation, and in realizing further integration into global trade 
with a view to achieving sustainable development. Japan was currently reviewing this proposal but 
remained open to engaging further in the discussion. He requested that the proponents provide 
Members with additio nal and detailed information as to which countries could benefit , based on latest 
statistics and relevant information on the domestic policies of the countries concerned . 
8.18.   The delegate of Canada  indicated that Canada appreciated the need for flexibility for  LDCs, 
as recognized in Annex  VII to the SCM  Agreement. However, Canada, like others,  required further 
time to assess the implications of the proposal and looked forward to bilateral discussions  on the 
issue. Canada also sought clarification from the propo nents on issues such as which of the recently 
graduated LDCs would currently benefit from the proposal; how future determinations would be 
made to identify those Members that would benefit from the proposal; and how the proposal would 
operate in terms of f luctuations in GNP per capita above or below the US$1,000 mark.  
8.19.   The delegate of Cuba said that her delegation supported the proposal and considered it to be 
fair. Cuba considered that  policy space should be available to LDCs based on their social and 
econo mic realities and  agreed to the proposal being forwarded to the General Council for adoption.  
8.20.   The delegate of Pakistan  said that Pakistan would analyse the proposal in light of the current 
discussion. His delegation requested the Secretariat to prepare, if  possible, a brief document 
detailing the original negotiating history of Annex  VII, with any relevant details, including the per 
capita GNP of developing and LDC  Members likely to graduate.  
8.21.   The delegate of the Russian Federation  said that Russia was asses sing the proposal and 
suggested that the Council revert to the issue at its next meeting.  
8.22.   The delegate of India expressed India's support for the proposal and  agreed with the principle 
that the GNP per capita threshold for graduation from Annex  VII should be extended to include newly 
graduated LDC  Members. India also supported the adoption of the draft decision.  
8.23.   The delegate of Australia  said that his delegation wished to further discuss the proposal. 
Australia acknowledged the benefit of ensuring tr ansparency where an LDC  Member had graduated ; 
for example, the SCM  Committee could be apprised of graduations of LDC  Members into the 
Annex  VII(b) category. This could be achieved with the help of technical assistance from the 
WTO Secretariat. Additionally , the Secretariat could prepare a factual document updating Members 
on which LDC  Members had graduated. This would be similar to the Secretariat updates relating to 
the calculations for the purpose of the Ministerial Decision on Annex  VII(b).  G/C/M/132  
 
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  8.24.   The delegate of the Bolivarian Republic of Venezuela  expressed the support of his delegation 
for the proposal and its adoption at the next meeting of the General Council.  
8.25.   The delegate of  Sri Lanka  supported the proposal but considered that the issue required 
additional  time and further discussion . 
8.26.   The delegate of Chinese Taipei  also said that they needed more time to assess the proposal 
and looked forward to further bilateral discussions with the Members concerned.  
8.27.   The delegate of Guatemala  supported the LDC  Group 's proposal; however, Guatemala was 
still consulting on the issue and reserved its right to revert to it in future Council  meetings . 
8.28.   The delegate of Afghanistan  associated his delegation with the statement delivered by the 
Central African Republic on behalf of t he LDC  Group. His delegation favoured the adoption of the 
proposal at the next General Council meeting.  
8.29.   The delegate of China  said that his authorities continued to study the proposal and would 
follow the se discussion s closely.  
8.30.   The delegate of Bangladesh  thanked Members for their statements and indicated that the 
LDCs were not seeking a new flexibility but wished rather to address a missing element in the 
Uruguay Round and the Doha Declaration. In response to some of the statements made, he said 
that five  LDCs had already been graduated, and that two others were in the process  of graduation . 
The Secretariat could estimate or calculate the GNP per capita by US$1990 values based on  the date 
when the LDC graduated officially; otherwise , it would be very difficult to do so, and difficult , too,  to 
identify which LDCs should or could  benefit from the Decision. The Secretariat regularly updated the 
Annex  VII(b) list and , if agreed, the Secretariat could also prepare a paper on this issue.  
8.31.   The delegate of the Central African Republic  thanked Members for their interventions. Almost 
all of the  delegations that had intervened had considered it necessary to address the needs of LDCs. 
At the WTO, all countries were united in multilateralism , and it  was a Member 's duty to give and 
grant the same advantages to all, without discr imination or injustice. The LDC  proposal claimed a 
perfectly legitimate right and was in perfect accord with the spirit of multilateralism.  
8.32.   The Chairperson  proposed that the Co uncil take note of the statements made and revert to 
the issue at its next meeting.  
8.33.   The Council so agreed . 
9  MODIFICATION OF TARI FF CONCESSIONS AND A PPLICATION OF TARIFF S HIGHER 
THAN THE LEVEL BOUND  IN HAITI 'S SCHEDULE  XXVI – REQUEST FROM THE DO MINICAN 
REPUB LIC 
9.1.  The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of the Dominican Republic had requested the Secretariat to include this item on the 
agenda.  
9.2.  The delegate of the Dominican Republic  referred to document  G/SECRET/39, dated 
10 February  2017, which contained Haiti 's notification of the modificat ion of Schedule  XXVI under 
GATT  Articles  XXIV and XXVIII , and to the statement made by the Dominican Republic at the 
meeting of the Committee on Market Access (CMA) h eld on 26  April 2018, on the same topic. In that 
notification, Haiti had submitted a list of 895  tariff lines whose concessions it hoped to modify in line 
with Haiti 's accession to CARICOM and in order to apply the Common External Tariff (CET) as of 
1 October 2017.  
9.3.  Three bilateral meetings had taken place between the two  Members aimed at conducting 
negotiations on the modifications to these tariff lines, in S eptember  2017, and February and 
May 2018. At the May meeting, the Dominican Republic had set forth a  reduced list of 140  tariff lines 
on which it had a principal supplier interest. However, Haiti had not made any counterproposal with 
a view to achieving a reciprocal and mutually advantageous level of  concessions as set out in 
GATT  Article  XXVIII:2 ; rathe r, Haiti had deemed that the negotiations had been concluded , and that G/C/M/132  
 
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  it would apply new tariff levels on a unilateral basis. While the negotiation process on Haiti 's 
modification of tariff concessions had yet to be conclude d, based on  its Finance Laws , Haiti had 
already been applying tariffs above the bound level for a number of products, including rum, 
cigarettes, and pasta. The Dominican Republic reserved all its rights at the WTO as set out in 
Articles  II, XXIV, and XXVIII of GATT  1994.  
9.4.  Article  XXVIII was intended for use in exceptional cases and for only a small number of tariff 
lines. However, Haiti had proposed to modify 890  tariff subheadings , which covered 40% of the 
Dominican Republic 's exports and amounted to a trade total of $289  million per year. This had 
adversely affected the Dominican Republic 's exports and had resulted in an enormous social and 
economic impact. The proposed new tariff levels were extremely high, with some reaching 300% 
and, in many cases, they we nt far beyond CARICOM 's CET. The immediate effect of the 
indiscriminate use of Article  XXVIII would establish a serious precedent and produce serious 
systemic damage that could lead to retaliation and disputes before the DSB. Article  XXVIII was 
intended to protect these advantages ; therefore , the main responsibility was to achieve a balance 
created and  applied on a good faith  basis. 
9.5.  Haiti's Schedule  XXVI was an integral part of the Agreement Establishing the WTO as well as 
of Part  I of the GATT  1994, and th erefore Haiti 's Schedule , with its bound tariff obligations , must 
remain unchanged. Without prejudice to the Dominican Republic 's rights under GATT  Article  XXIV, 
Haiti must accede to CARICOM using the range of flexibilities available to LDCs. Haiti was req uested 
to keep the Council informed of any progress in this regard . 
9.6.  The delegate of the United States  said that the US had significant systemic concerns with Haiti 's 
request to raise hundreds of tariff lines well above CARICOM 's applied tariff rates; this was not 
acceptable. The US also questioned the basis of Haiti 's request given the extensive flexibilities 
afforded to CARICOM  Members in the ir application of a CET , noting that it  would be a source of 
concern if Haiti 's request were to open the door to oth er CARICOM  Members seeking to raise their 
own bound tariff levels. If Haiti were to proceed to raise  its tariffs via its current budget process, it 
would do so without agreement from WTO  Members, including the US , and the US urged Haiti not 
to take such a step. The US stood ready to assist Haiti to the extent possible in narrowing its tariff 
request so that Haiti 's needs could then be met in a WTO -consistent way and without at the same 
time causing undue harm to Haiti 's neighbours and trading partners.  
9.7.  The delegate of Brazil  said that Brazil had submitted  a claim of interest under 
GATT  Article  XXVIII and had undertaken and engaged in consultations and negotiations with Haiti in 
this regard . Brazil wished  to see continued engagement on the part of Haiti,  including by proceed ing 
with consultations.  
9.8.  The delegate of Canada  said that Canada had submitted a claim of interest to Haiti in response 
to its notification  G/SECRET/39, and looked forward to furthering its discussions with Haiti in this 
regard . 
9.9.  The dele gate of Japan  said that Japan had submitted a claim of interest to Haiti and had 
requested Haiti to provide an update . Japan looked forward to further discussing the matter with 
Haiti.  
9.10.   The delegate of Haiti said that Haiti was fully aware of the problem be ing highlighted, and 
indicated that the negotiation process had two  separate goals: (i) to harmonize Haiti 's tariff 
concessions with CARICOM 'S CET so that Haiti could trade fully with other CARICOM  Members; and 
(ii) to ensure that Haiti 's WTO  Schedule of C oncessions was compliant with WTO  rules. Negotiations 
had begun with one of the five  Members to have raised their interest, but agreement had not been 
reached due to some substantive divergences in opinion. Nevertheless, Haiti was committed to 
ongoing bilateral discussions and negotiations with all Members that had submitted a claim of 
interest. The results of the concluded negotiation s would be notified to the WTO  in due course . 
9.11.   The Chairperson  proposed that the Council take note of the statements made.  
9.12.   The Council so agreed . G/C/M/132  
 
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  10  UNITED STATES – SECTION 232 INVESTI GATIONS AND MEASURES  – REQUEST FROM 
JAPAN AND THE RUSSIA N FEDERATION  
10.1.   The Chairperson  informed the Council that , in communications dated 21  June 2018, the 
delegations of the Russian Federation and Ja pan, respectively, had requested the Secretariat to 
include this item on the agenda.  
10.2.   The delegate of Japan  expressed his delegation 's concern over the additional customs duties 
and quotas imposed by the United States on steel and aluminium , arguing that th ese measures 
could not be justified on the basis of national security.  
10.3.   Japan was deeply  concern ed that potential measures based on the ongoing Section  232 
investigation of imports of automobiles, including cars, SUVs, vans, light trucks, and automotive 
parts, would cause serious disruption to the world market considering  the huge proportion of global 
trade accounted for by these products. Such measures could trigger a spiral of countermeasures and 
result in the collapse of the multilateral trading system ba sed on WTO  rules. Any trade measures 
introduced needed to be consistent with the WTO  Agreement s. Japan would take any appropriate 
and necessary future action in light of how the situation  developed . 
10.4.   The delegate of the Russian Federation  recalled that his delegation had raised previously the 
issue of Section  232 investigations on steel and aluminium , and regretted that the situation had 
worsened  in the meantime . Indeed, the use of Section  232 was now not only limited to metals. On 
23 May 2018, an investigat ion had been initiated with respect to imports of automobiles , but no 
clarity had been given on product and geographical scope, the possible form that the measures  
might take , and their rationale. Moreover, according to publicly available information, the 
US Department of Commerce may soon decide to begin a new investigation into imports of uranium 
products. The Russian Federation was deeply concerned by such prospects.  
10.5.   The proclaimed objective of the measures was to bring relief to US  industries in order t o 
strengthen the US  economy ; however, the appropriateness of recourse to Section  232 in pursuit of 
such aims was doubtful. In fact, the US was punishing its own economy, as deliberate elimination 
of competition by the US  authorities would only lead to high er prices and poorer quality  goods , with 
the result that the ability of US  downstream companies t o export would also be reduced.  
10.6.   The potential p olitical gains for the US were as blurred and unclear as any potential economic 
gains to be derived from the mea sures  at issue . The US was losing its reputation as a trusted trading 
partner and was also establishing the record as the WTO  Member posing the greatest  threat to the 
rules-based trading system; this had become a systemic  challenge for the entire WTO Membe rship. 
The Russian Federation urged the US to reconsider its approach to trade defence instruments and 
to give up measures that brought reciprocal harm both to itself and to its trading partners. The US 
should abide by WTO rules, stop the ongoing Section  232 investigations , and re frain from starting 
new Section  232 investigations.  
10.7.   The delegate of the European Union  expressed the EU 's concerns over the launch of the new 
US investigation under Section  232 on imports of cars, car parts, and light trucks. In the EU's view, 
there was no justification for measures restrict ing imports of these products on grounds of national 
security. Nor was there any apparent economic threat to the US  automobile industry which, having 
steadily expanded domestic production in the last 10  years , was healthy . Any trade -restrictive 
measure in this sector would have a serious negative impact not only on the EU but also on the 
global economy  overall . The EU was determined , in a WTO -compatible manner , to fully protect its 
commercial inte rests. 
10.8.   The delegate of Canada  said that Canada had requested consultations with the US under the 
WTO's dispute settlement mechanism concerning the US  measures on imports of steel and 
aluminium from Canada pursuant to Section  232. Canada was concerned about  the use by the US 
of Section  232 investigations and potential tariffs as protectionist tools. There was no link between 
US national security concerns and imports of au tomobiles and automotive parts.  
10.9.   The delegate of Switzerland  said that Switzerland was al so affected by the tariffs on steel and 
aluminium imposed by the US under Section  232. The US customers of Swiss steel and 
aluminium -producing firms bought their steel and aluminium from Switzerland not because the G/C/M/132  
 
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  products were cheaper but because they were unable to find the same products at home. Indeed, 
the additional tariffs in force sinc e 23 March  2018 were already having a negative impact on the 
supply chain, on Swiss producers and exporters, on US  downstream industry, and therefore, in turn , 
on US  consumers. The US had granted the possibility for US -based companies to request product 
exemptions , but the procedure was cumbersome, costly, and, in addition to the high  number of 
requests, very slow.  
10.10.   Switzerland echoed the concerns expressed by many other  delegations and had doubts about 
the conformity of the US  measures with WTO  rules, which had started to trigger a dynamic of 
measures and countermeasures that were harmful to all. Certainly , there was a serious problem of 
global overcapacity in the steel and aluminium sectors ; however, to impose import duties at the 
border would not solve the global overcapacity problem. Instead, it needed to be addressed and 
resolved through dialogue and negotiation between those Members primarily concerned. The 
OECD  Global Forum on Steel and Excess Capacity had been established exactly to solve the 
overcapacity issue , and Switzerland urged the main players to work constructively towards a solution 
in that context, and to refrain from taking unilate ral measures.  
10.11.   The delegate of Norway  joined others in expressing Norway 's deep concern over new 
potential trade barriers for autos and auto parts. Norway had both commercial and systemic interests 
in the matter and urged the US to take into consideration t he serious consequences of any such 
action for the US, the global economy, and the  multilateral trading system  (MTS). 
10.12.   The delegate of Turkey  reiterated that US export duties on steel and aluminium imports 
could not be justified on the basis  of national sec urity, and that such unilateral action breached the 
core principles of the WTO. Any action applied to the automotive indust ry would only worsen the 
situation. The measures applied by the US were safeguard measures , which had not been adopted 
in accordance with the substantive and procedural requirements of GATT  Article  XIX and the 
Agreement on Safeguards.  
10.13.   In line with the Agreement  on Safeguards , Turkey had suspended concessions against the 
US in response to its safeguard measures, which were substantially equivalent to the amount of 
trade affected by the US  measures. Imposing unilateral tariffs , and protectionism in general, only 
worsened Members ' welfare and ignited protectionist measures worldwide, as could already be 
observed. Turkey called on the US to reconsider its measures in light of the need to maintain the 
integrity of the rules -based MTS. While continuing dialogue and cooperation with the whole 
Membership, including the US, Turkey reserved its rights under  the WTO  rules and Agreements.  
10.14.   The delegat e of Costa Rica  expressed Costa Rica 's concern over the situation facing global 
trade. The rules -based trading system had been a key pillar in Costa Rica 's development policies. 
Costa Rica considered that there was scope to continue strengthening and improving the MTS, and 
that the best way to do so was through enhanced  commitments , strengthened disciplines, and better 
governance. Only through further and  improved involvement a nd collective effort would it be 
possible to b uild a more robust proposal for updating the WTO  system to enable it to meet current 
needs. Costa Rica call ed upon Members  to open all possible channels for dialogue and to prioritize 
solutions that were in line with the WTO rules-based system , while at th e same time  respect ing 
those  rules and making all necessary  efforts to render the MTS stronger and more inclusive.  
10.15.   The delegate of Hong Kong, China  said that , since March , there had been increasing trade 
tensions globally, which in turn were creating furth er uncertainties in the international trading 
environment. The unilateral tariff measures implemented by one  Member had triggered 
countermeasures by others. There  was currently no sign of these tensions abating , and if the 
situation persisted no economy would remain unaffected. In the end, everyone stood to lose. Hong 
Kong, China, was deeply concerned not only about the impact on its own businesses, but also about 
the implication s for the rules -based multilateral trading system  in general . For these reaso ns, Hong 
Kong, China, called on all parties to exercise restraint and to engage in constructive dialogue with a 
view to reaching WTO-compatible solutions.  
10.16.   The delegate of the Bolivarian Republic of Venezuela  reiterated Venezuela 's systemic 
concerns regardi ng the implementation  by one  Member  of unilateral measures, including 
investigations and measures under Section  232 on National Security; these measures had adversely 
affected  other countries ' interests.  G/C/M/132  
 
- 16 - 
 
  10.17.   The delegate of Singapore  expressed deep concern over the punitive tariffs imposed by the 
US on several products , which would adversely affect global supply chains and global growth. There 
would also be a downstream impact on those US industries that depended on these imports. More 
broadly, such actions undermined the rules -based multilateral trading system, and the continuing 
escalation of tensions was worrying. Singapore urged all Members to exercise restraint and avoid 
escalating the tensions  further . Trade conflicts had a wide -ranging impact and would  hurt the global 
economy, global growth, and ultimately workers , and consumers , too . Singapore had both 
commercial and systemic concerns  regarding the US  Section  232 tariffs on steel and aluminium. Its 
companies had expressed concerns over both the direct and the knock -on effects of the measure on 
their exports , and remained concerned , too,  over the uneven treatment of exports from different 
Members. Singapore was closely monitoring the ongoing Section  232 investigations on automobiles 
and auto parts given the potential negative impact of the measures on Singapore.  
10.18.   The delegate of China  said that the US  import duties on steel and aluminium products, under 
Section  232, were not consistent with WTO  rules. In March  2018, the US had decided to impose 
additional tariffs on imported steel and aluminium products on the grounds of national security. 
However, most steel and aluminium products imported by the US were products intended for civilian 
purposes, which could not prejudice US  national security. Section  232 measures had been adopted 
to protect the commercial interests of US  domestic industries. Therefore, the measures were purely 
trade -protectionist , posing  under the guise of national security concerns, and would se riously 
undermine the MTS. In contrast, China consistently supported the authority and stability of the MTS.  
10.19.   On 5 April 2018, China had raised a case under the WTO  dispute settlement system against 
the US  measures under Section  232, and afterwards, WTO  Members, including Canada, the EU, 
India, Mexico, Norway, and the Russian Federation, had also requested cons ultations under the DSU. 
The US  measures had therefore been strongly opposed by most WTO  Members. China urged the US 
to respect the WTO 's multilateral  trading rules and to withdraw the measures at issue as soon as 
possible.  
10.20.   China also recalled that Mr  Peter Navarro, the Director of the US  White House National Trade 
Council , had recently said that any country currently exempted from the tariff would subsequently 
be subject to a quota and other restrictions. China sought clarification from the US as to whether or 
not this statement was true, and also as to whether or not the US had reached any agreement of 
quota or any form of voluntary export restriction with those WTO Members exem pted from the 
Section  232 measures.  
10.21.   China also noted that, despite the strong opposition from most WTO  Members, on 
23 May 2018 a new Section  232 investigation had been initiated against imported automobiles and 
parts thereof. Automobiles and parts and components thereof imported by the US were mostly 
products for civilian purposes and did not involve any risk to national secu rity. Chin a believed that 
the frequent US  investigations under Section  232 were protectionist investigations, under the guise 
of "national security " concerns, which would significantly distort global market s and value chains. 
Such abuse of so -called nation al security measures not only disturbed the normal international trade 
order of the products  concerned , but also brought serious challenges to the MTS.  
10.22.   China and other WTO  Members had repeatedly expressed their clear opposition to such 
measures and investi gations. China would follow development s closely and work together with all 
WTO Members to tackle this challenge while at the same time  taking all  necessary steps to safeguard 
China 's legitimate rights and interests. In the context of the current complicat ed and difficult 
international economic and trade situation, China would continue to take concrete actions to 
safeguard the authority of the WTO, and called on the whole Membership to join China in firmly 
fighting against u nilateralism and protectionism.  
10.23.   When China referred to the US  Section  301 investigation and the relevant unilateral 
protectionist actions, and indicated that on 15  June 2018, the USTR had announced the imposition 
of an additional duty of 25% on $50  billion worth of Chinese imports, under  Section  301 of the 
US Trade Act, the delegate  of the United States  raised a point of order given that China was taking 
the opportunity to raise an issue that did not fall under the agenda item , and that China h ad not 
inscribed on the agenda.  G/C/M/132  
 
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  10.24.   The delegate of China  responded that the reference to Section  301 formed part of China 's 
integral statement under the current agenda item as China had s ignificant concerns over the 
US unilate ral and protectionist measures.  
10.25.   The Chairperson  invited China to limit its comme nts to Section  232 only and  observed  that 
China should have indicated that it would raise th e Section  301 issue under "Other Business ". 
10.26.   The delegate of China  indicated that the US  actions amounted to  a severe violation of the 
fundamental pri nciples of the WTO, would seriously damage the MTS and disrupt the global trade 
order, and that Section  301 and Section  232 investigations were typical unilateral actions that were 
inherently incompatible with the multilateral trading system.  
10.27.   The delegate of the United States  again raised  a point of order , reiterating that at the start 
of the meeting China had not indicated its inte ntion to refer to Section  301. Therefore,  the point of 
order raised by the US referred both to this agenda item and to  any inte ntion that China may have 
to raise a Section  301 issue under "Other Business ". 
10.28.   The Chairperson  requested China to limit its comments to Section  232, as indicated in the 
title of the agenda item . 
10.29.   The delegate of China  said that Section  232 investigations were typically unilateral actions , 
which were inherently incompatible with the MTS. History showed that if unilateralism went 
unrestrained it would bring destruction to the world economy and all WTO  Members, especially  
developing Members.  
10.30.   While it was not clear which country and which product would be the next target of 
US unilateralism, if WTO  Members were not able to fight and control the current unilateralism and 
protectionism, the whole WTO  Membership, including the  United States, would be the victims  of it. 
10.31.   China wished  the United States to respect both the facts and the rules. At the same time, 
China would take all necessary measures to fight against unilateral actions and defend its legitimate 
rights and interests  under the multilateral trading system.  
10.32.   The delegate of Brazil  said that , like other Members , Brazil had emphasized on several 
occasions, in the CTG and elsewhere , its systemic concerns with investigations and measures 
conducted or adopted by the US under its Section  232 investigations , justified on the grounds of 
national security.  
10.33.   Recent developments, particularly the launching of similar investigations regarding 
automobiles and auto parts , further highlighted the risks inherent in a flexible interpretati on of the 
security exception contained in GATT  Article  XXI. Brazil urged the US to reconsider its approach.  
10.34.   The delegate of  the Republic of Korea  said that Korea had serious concerns over recent 
developments. History had shown that the spread of trade -restrictive measures did not bring about 
desirable outcomes in the long run. Therefore, the notion of national security in GATT  Article  XXI 
must be interpreted in a very limited and cautious manner in order to secure the rules -based MTS.  
10.35.   The delegate of Mexico  joined other speakers in expressing concern over the implementation 
of Section  232 measures. Problems linked to overcapacity in certain sectors, such as steel and 
aluminium , did exist ; nevertheless,  imposing unilateral measures would never be the solution . 
Solutions came  instead  through dialogue and strict respect for multilaterally agreed rules. In 
Mexico 's view, the US investigation regarding light vehicles, trucks, and their parts, and the 
application of such measures , would have a devastating impact on  international trade.  
10.36.   The delegate of Qatar  joined other Members in stating the ir concern about  the 
US Section  232 measures and their implications for the MTS. For its part, Qatar was committed to 
the multilateral trading system and the rules -based system of dispute settlement. Within this 
context, Qatar did recognize that certain measures were permissible when intended to protect 
essential security interests. However, Members needed to exercise restraint before they invoked 
such defences.  G/C/M/132  
 
- 18 - 
 
  10.37.   If ther e were to be a dispute concerning WTO -inconsistent measures that were be ing justified 
on the grounds of essential security interests, then it would be the WTO rules-based framework that 
would provide the proper forum for settling such a dispute. As with any affirmat ive defence, a party 
invoking the defence had to prove the elements it put forward, and any defence measure would be 
subjected to multilateral oversight.  
10.38.   The delegate of Thailand  shared the concerns of other Members regarding the systemic and 
commercial im pact resulting from the US  measure and its extension into imports of automobiles and 
auto parts. The measure had already resulted in a direct and indirect negative impact on global trade 
and economic growth and  had also escalated the risk of retaliations a nd counter -measures. Thailand 
had noted the connection between the measure and the issue of over -capacity and  urged all 
Members to resolve their trade issues in compliance with WTO  rules and obligations.  
10.39.   The delegate of India joined other Members in expressing concern over the US Section  232 
trade policy measures enforced on steel and aluminium products. It was an important systemic issue 
and a misuse of the security exceptions under the GATT. Such unilateral measures had no p lace in 
the trade arena and Members needed to exercise restraint and to respect the WTO rules. The 
application of such measures should not have the objective of creating trade barriers. Such measures 
should also be consistent with Members ' WTO commitments.  
10.40.   Since the impact of the measure on India 's exports of aluminium and steel products  was 
substantial , India had taken action under the Agreement on Safeguards, and had also expressed its 
concerns by resorting to the WTO  Dispute Settlement Mechanism for the matter 's early resolution. 
India would be watching developments  closely . 
10.41.   The delegate of the United States  said that its Section  232 investigation on steel and 
aluminium was an issue that had been referred to the Dispute Settlement Body . Matters subject to  
dispute did not belong on the agenda of the Council. Members should refer to the US  statements 
that had been made in the SCM  Committee as well as at the DSB for further information on the 
US position.  
10.42.   The Chair person  proposed that the Council take note of  the statements made.  
10.43.   The Council so agreed . 
11  BAN ON THE OVERLAND EXPORT OF 23  PRODUCTS FROM THE DO MINICAN REPUBLIC 
TO HAITI – REQUEST FROM THE DO MINICAN REPUBLIC  
11.1.   The Chairperson  informed the Council that , in a communication dated 21  June 2018, the 
delegation of the Dominican Republic had requested the Secretariat to include th is item on the 
agenda.  
11.2.   The representative of the Dominican Republic  expressed her authorities ' concern  over the 
effects on their expor ters of the ban on overland export applied by Haiti since October  2015.  Haiti's 
measure consisted in the ban on overland export of 23  products from the Dominican Republic into 
Haiti that, even though it had been  imposed almost three  years ago, had  still to  be notified to the 
WTO. The ban was leading to enormous losses for Dominican Republic producers of the 23  products, 
which cover ed 60 tariff headings. Additionally, a resulting domino effect  had resulted in considerable 
unpredictability and insecurity for traders , which was negatively affecting a total of 1,227  tariff lines.  
11.3.   The measure affect ed a whole range of categories of goods, including : food products such as 
flours, vegetable products, edible oils, pasta, and drinking water ; construction products, su ch as 
cemen t, rods, and PVC tubes ; and other products, such as washing powder, soap, and mattresses.  
Since the implementation of th e measure , Dominican Republic exports of products covered by the  
ban had fallen by 48% and overall exports from the Dominican Republic to Haiti had fallen by 43%.  
11.4.   Haiti was an important trading  partner of the Dominican Republic, a ccount ing for 56% of 
Dominican Republic exports of the 60  tariff lines directly affected by the ban ; and more than 37% 
of the tariff lines aff ected by the ban  represented 50% of Dominican Republic exports. Additionally, 
Haiti was the only export market for the remaining 11% of the tariff lines affected by the ban . G/C/M/132  
 
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  11.5.   Since the ban had been applied exclusively to overland exports  it only affected products from 
the Dominican Republic,  as the Dominican Republic was the only country to share a land border  with 
Haiti. Since t he same products from third  countries continue d to arrive to Haiti by sea , Dominican 
Republic exports ha d been replaced by products  originating in other countries.  
11.6.   The ban on overland export consequently led to a very costly and burdensome export process 
that mean t that exporters from the Dominican Republic had to  export their goods by sea, which 
made the process of export extremely expensive , consequently undermining the competitiveness of 
the Dominican Republic products concerned . This clearly had an impact on  trade flow s between the 
two nations , and  treatment given to products from the Dominican Republic was discriminatory 
because it was less favourable than the treatment given to similar products imported from 
elsewhere . 
11.7.   In addition , the measure  taken  by Haiti ha d not been published in the Official Journal , meaning 
that governments and traders had not been made aware of how the mea sure was being 
implemented. Interested economic operators ha d not been given an opportunity to comment on the 
regulations , and the measure ha d not been notified to the WTO.  The ban affect ed the export of other 
products, too, since it had also been extended  to include transport operators from the Dominican 
Republic. As a result, goods were being removed from vehicles at the Haiti border in order to be 
transported i n Haitian territory by Haitian transport operators.  
11.8.   The measure, which had not been officially notified, was inconsistent with Articles  I:1; V; X:1 
and X:2; and XI , of the GATT  1994.  For developing countries like the Dominican Republic,  
predictability and transparency were key factors to earning the trust of investors leading to the 
development of its trade and export capacity . The MTS and its rules had to be respected by all 
Members  and Haiti should therefore withdraw its measure , respect the relevant rules , and keep the 
Goods Council inform ed of the measures that it was taking or intended to take to resolve the 
situation.  
11.9.   The delegate of Haiti said that the aim of his Government was not to create unnecessary 
obstacles to trade but rather to address the porousness of the land border between the 
two countries.  Following the earthquake that had struck  Haiti in 2010, which had destroyed certain 
physical infrastructure, customs offices , and police stations , the border between the two  countries 
had become even more porous , resulting in increase d smuggling and, consequently, to a loss in 
customs revenue fo r the Haitian State.  
11.10.   Statistics showed that there ha d been a net decrease in revenue generated by imports 
transported over land compared to revenue from imports transported by sea. To address this 
problem, Haiti ha d introduced the temporary measure while i t sought a viable solution.  In this 
regard, the customs authorities of both countries were fully aware of the severity of the problem 
and, following a number of working meetings, had together engaged to exchange information and 
other practices to help fight contraband and smuggling. However, there had been to date no positive 
results and t he measure had therefore remained in force.  
11.11.   Haiti wished to continue to work closely with the Dominican Rep ublic to find a viable solution 
that would lead to the removal of th e measure  at issue . 
11.12.   The Chairperson  propose d that the Council take note of the statements made . 
11.13.   The Council so agreed . 
12  INDONESIA 'S IMPORT AND EXPORT RESTRICTING POLICIES  AND PRACTICES – 
REQUEST FROM THE EUROP EAN UNION, JAPAN, AN D THE UNITED STATES  
12.1.   The Chairperson  informed the Council that , in communications dated 21  June 2018, the 
delegations of the European Union, Japan, and the United States, respectively, had requested the 
Secretariat to  include this item on the agenda.  
12.2.   The delegate of the European Union  noted that, despite some efforts made to address them, 
including a certain simplification of import procedures , there remain ed a high number of 
cumbersome trade -restrictive measures in Indonesia 's trade policy that were of a symptomatically G/C/M/132  
 
- 20 - 
 
  protectionist nature , and which did not help to develop Indonesia 's trade , business , and investment 
climate.  The unclear legal framework and the uncertain state of implementation of various of 
Indones ia's laws generated  legal uncertainty.  
12.3.   The EU cited examples of such laws, as follows : the use of local content requirements in 
telecom s, retail, energy, construction, transport, and shipping of key commodities and public 
procurement ; the complex and burde nsome import requirements for meat and dairy products, fresh 
plants, horticulture, wood and forestry products, alcohol, and cosmetics ; cosmetics further subjected 
to recently increased, very high registration fees; quantitative restrictions on meat, steel,  and tyres; 
export  restrictions on certain raw  materials; burdensome and discriminatory conformity assessment 
procedures ; and the growing proliferation of mandatory technical standards.  
12.4.   The EU request ed Indonesia to provide precise information on the state  of play of the 
implementing regulations of Halal Law  33/2014. The scope of th e Law was extremely broad and 
would affect food and beverages, pharmaceuticals, cosmetic s, and leather goods. If fully 
implemented, it would bring trade to a halt. Since at least  two governmental regulations were under 
preparation , Indonesia should provide Members with precise information with regard to their scope, 
object, and the timing of the measures , and also to notify them in accordance with WTO rules. In 
the EU 's view, Indonesia should rather apply voluntary Halal certification and labelling, which would 
be a less trade -restrictive measure.  
12.5.   The EU also request ed to receive information about the state of play of the rules and standards 
regulating the production of processed m ilk and relevant investments  and of Ministerial 
Decree  82/2017 , which appear ed to mandate  that export and import of key commodities was to be 
carried out and insured by domestic companies.  Indonesia was urged to eliminate its many  trade 
barriers and , in line with its G-20 commitments , to refrain from erecting  new barriers . 
12.6.   The delegate of Japan  referred to its statement s delivered at the previous CTG and 
TRIMs meetings, and again register ed its significant  concern over the various trade -restricting 
measures of Indonesia, such as LCO on 4G  mobile phones. Japan urged Indonesia to fully update  
Members on those measures and to explain its concrete actions in a manner compliant with the 
WTO Agreements.  With regard to t he Mining Law, Japan continue d to belie ve that relaxation of the 
complete export prohibition of nickel ore was still inconsistent with GATT  Article  XI. 
12.7.   At the last meeting  of the Council , Indonesia had stated that the purpose of th e measure was 
to protect its natural resources from exploitation . However, th at argument d id not justify the fact 
that natural resources were allocated in  a discriminatory manner that ga ve favourable treatment to 
the domestic industry , a point  clearly supported by the Decision in China – Rare Earths  (DS431) . 
12.8.   The delegate of the United States  said that , in previous interventions at this Council , her 
delegation had reviewed in some detail the broad range of US concerns, including its concerns over 
localization requirements, and requirements on import licensing s tandards, pre -shipment inspection, 
and export restrictions, including taxes and prohibitions, among others.  
12.9.   The US had also  expressed its concern over Indonesia 's general lack of transparency with 
regard to these measures.  In particular, the US was signifi cantly concern ed by Indonesia 's systemic 
use of local content requirements , as imposed by Indonesia across a broad range of sectors, 
including telecommunications, mobile technology, energy, agriculture, retail, and franchising.  The 
US also noted that, at the most recent TRIMS  Committee meeting, more than half of the matters 
raised, six of eleven, had concerned Indonesia.  
12.10.   Despite US efforts to reduce the number of Indonesia 's localization requirements, Indonesia 
continue d to forge ahead with these  policies b y implementing local purchase requirements on dairy 
products , and by developing new local content requirements for human and veterinary 
pharmaceutical products.  
12.11.   In addition to the increasing number of localization requirements, the US also remain ed 
concerned by various other trade -restrictive measures in Indonesia.  Regarding agriculture, for 
example, Indonesia was developing new requirements on soy beans, which would ba n imports during 
the domestic soy bean harvest period.  G/C/M/132  
 
- 21 - 
 
  12.12.   Indonesia 's recent regulat ion that establishe d tariff lines for electronically transmitted 
software and digital goods  was also a cause of concern, particularly as reports indicated that 
Indonesia plan ned to raise the import duty rates on th ose tariff lines , a move that could  contra vene 
the moratorium on customs duties on electronic transmissions.  
12.13.   The US hoped that its work would soon produce results that would ensure that trade between 
Indonesia and the US  would be free and fair . 
12.14.   The delegate of Thailand  share d the concerns of other  Members regarding Indonesia 's 
import -restrictin g measures, especially Indonesia 's import licensing and quantitative restrictions on 
horticultural products, which ha d been found to be inconsistent with WTO  rules.  Thailand 's 
agriculture exports ha d been negatively affected by these trade -restrictive measures.  Thailand 
encourage d Indonesia to bring all its measures into conformity  with the  WTO's rules and obligations 
and to p rovide updates on any actions that it had undertaken  to that end . 
12.15.   The delegate of  the Republic of Korea  share d other Members ' concerns  and encourage d 
Indonesia to formulate its implementing regulations in line with WTO  rules and to share any progress 
made in this regard in a timely manner.  
12.16.   The delegate of Switzerland  also share d other Memb ers' concerns regarding Indonesia 's 
regulation No. 26/17 on the supply and distribution of milk products.  Companies continue d to 
confront the significant negative impact of Indonesia 's local content requirement regime , and trade 
was either interrupted or under threat of being interrupted.  
12.17.   Indonesia should provide detailed information and ensure full transparency under the new 
regulation and its implementation measures, particularly the procedure for granting import 
recommendations by  the Ministry of Agriculture and the way s in which these are translated into 
import permits by the Ministry of Trade.  The delay in providing adequate information was a critical  
issue for supplying countries and d id not help them to develop confidence in In donesia 's new regime.  
12.18.   Indonesia should  ensure the full compatibility with WTO  rules of its new law s and their 
implementation , and local content requirements should not be applied in such a way as to 
discriminate against foreign exporters and to exclude the m from the Indonesia n market.  
12.19.   The delegate of New Zealand  echoed Members ' previous  concerns . New Zealand believe d 
that Indonesia 's restrictions on agricultural imports undermine d core WTO  principles and were 
inconsistent with key obligations under  the WTO  Agreements.  New Zealand continued to h ave 
significant concerns over the number of import restrictions that were affecting trade across a range 
of agricultural products , and p articularly over the recent introduction of measures that restrict ed 
imports of dairy and horticultural products.  
12.20.   However, New Zealand welcome d Indonesia 's commitment to implement the 
recommendations of the Dispute Settlement Body in Indonesia – Import Licensing Regime s, 
(DS477/478 ), and it was hopeful that the implementat ion process would result in meaningful  
long-term reforms to Indonesia 's restrictive import regime.  Indonesia 's restrictions did not just hurt 
exporters  but also Indonesian consumers, processors, and producers , as the new measures  
contributed to rises in fo od prices in Indonesia, including for basic foodstuffs and ingredients in the 
domestic manufacturing sector.  New Zealand hoped that Indonesia would in future implement its 
reform plans using policies that were WTO-consistent . 
12.21.   The delegate of Canada  continu ed to share the concerns of other Members regarding 
Indonesia 's persisting import restricting policies and practices, although Canada also welcomed the 
limited progress that had been made on improving the business climate in Indonesia; nevertheless , 
more progress was required. Restrictions in the mining, oil , and gas sectors, increasing local content 
requirements across many sectors, including renewable energy, and the uncertainties surrounding 
Halal certification requirements, caused particular concern. C anada also remained concerned by the 
import licensing requirements in place for horticultural products . Canada concluded by encouraging 
Indonesia to adhere to its WTO  commitments.  
12.22.   The delegate of Brazil  shared other Members ' concerns regarding the trade -restrictive 
measures that, in the case of Brazil, had been particularly harmful to its exports of poultry and beef. G/C/M/132  
 
- 22 - 
 
  Brazil had initiated two  dispute settlement procedures concerning these issues, one of which, DS484 , 
had been the object of a panel report fav ourable to Brazil 's main requests. Brazil encouraged 
Indonesia to adopt measures that eliminated barriers and to implement the pane l recommendations 
and findings  in the case of DS484 . 
12.23.   The delegate of Australia  said that Australia valued its trading relatio nship with Indonesia 
but continued to share other Members ' concerns over  Indonesia 's import -restricting policies in recent 
years, particularly as those policies increased the risks and costs of agricultural trade. Indonesia 
frequently amended its regulatio ns on the importation of agricultural products, often without 
notification and, even when notified, did so giving only limited opportunity for consultation with 
trading partners.  
12.24.   Notification and consultation were critical to the continuing effectiveness o f the rules -based 
global trading system under the WTO. Consultation with trading partners also provided the 
opportunity for trade conditions to be implemented in the most efficient way for all parties, and for 
the benefits of trade to flow efficiently also to Indonesian consumers and producers who relied on 
imported inputs for their production.  
12.25.   The delegate of Chinese Taipei  said that her delegation continued to share other Members ' 
concerns regarding a series of laws and regulations introduced by Indonesia , particularly concerning 
trade and industry restrictions in the retail sector , and local content requirements on 4G  mobile 
phones. They had already voiced their concerns in other meetings but now had a particular concern 
over Indonesia 's increasing use of  local content requirements. Chinese Taipei urged Indonesia to 
inform WTO  Members of any developments, and to make further efforts to review the measures  at 
issue to ensure that they were fully compliant with the WTO  Agreements.  
12.26.   The delegate of Indonesia  said that Indonesia had carefully considered the concerns raised 
by Members regarding a number of its policies or measures that had been  interpreted to be  trade 
restrictive in nature. However, Indonesia nevertheless considered that its trade policies 
corresponded  well to its WTO  commitments.  
12.27.   Those measures that certain Members had perceived to be restrictive in nature, could well 
be a result of  Indonesia 's efforts to cope with certain outstanding problems and negative impact that 
they were confronting in r elation to Indonesia 's process of opening up to international trade. 
Indonesia had updated Members on the measures at issue in the WTO's relevant bodies . 
12.28.   Indonesia had also noted that exports of goods to Indonesia from those Members sponsoring 
the agenda  item had in fact shown a positive growth , well beyond their average total global export 
growth for 2016 -2017. In donesia stood ready to discuss these  concerns bilaterally with a view to 
finding a mutually beneficial solution.  
12.29.   The Chairperson  proposed that th e Council take note of the statements made.  
12.30.   The Council so agreed . 
13  UNITED STATES – MEASURES RELATED TO  IMPORTS OF FISH AND  SEAFOOD 
PRODUCTS – REQUEST FROM CHINA AND THE RUSSIAN FEDE RATION  
13.1.   The Chairperson  informed the Council that , in communications dated 21  June 2018, the 
delegations of the Russian Federation and China, respectively, had requested the Secretariat to 
include this item on the agenda.  
13.2.   The delegate of the Russian Federation  indicated that the US  Seafood Import Monitori ng 
Program (SIMP , or US  SIMP)  consisted of two  major elements: reporting at point of entry in the 
United States, and record keeping of information on chain of custody for two  years. The programme 's 
objective was the exclusion from the US  market of misrepre sented  and illegal, unreported , and 
unregulated (IUU) fish products . 
13.3.   The US  SIMP had become effective in January  2017, with mandatory compliance effective as 
from 1  January  2018. It was foreseen that the SIMP would eventually  cover all fish species exporte d 
to the United States; however, only 11  species were currently subject to the new requirements. The G/C/M/132  
 
- 23 - 
 
  differentiation between fish species was unclear and raised questions about SIMP 's compliance with 
the MFN  principle. The new requirements were burdensome for importers and exporters of fish and 
seafood products and could amount to being  a measure more trade restrictive than necessary. The 
Russian Federation would continue to monitor closely the SIMP 's implemen tation in order to verify 
its com pliance with WTO  rules.  
13.4.   The delegate of China  said that China also considered the SIMP to be inconsistent with 
WTO rules, as it not only lacked transparency but was also applied only to imported seafood. In 
addition,  the SI MP was subject to conformity assessment procedures (CAPs) under the 
TBT Agreement, public consultations had only taken place in the United States, and the Programme 
had not been notified to the TBT  Committee. Thus, Members had not enjoyed  at least 60  days to 
comment on these requirements , and nor had they been extended a transition period of at least 
six months, as required by the WTO  transparency provisions.  
13.5.   The US  National Oceanic and Atmospheric Administration (NOAA) had indicated that the SIMP 
would only apply to imported shrimp and abalone once the commensurate reporting and/or record  
keeping requirements had been established for the US  domestic aquaculture raised shrimp and 
abalone production. However, according to a recent announcement in the US  Federal Register, the 
programme would apply to imported shrimp and abalone by end-2018. China therefore sought 
clarification from the US as to whether or not the commensurate reporting and/or record  keeping 
requirements had been established.  
13.6.   Moreover, the SI MP lacked scientific justification as it covered all imported seafood without 
distinction between high and low risk products, or between aquaculture and fishing products. China 
believed that , given its lack of scientific basis , the SIMP should not include aquaculture products.  
13.7.   The SIMP also created  unnecessary trade restrictions , in particular because of the complexity 
of its data requirements for the entry of seafood into the US, which made it difficult to collect the 
complete traceable information  as requ ired by the program . The program also overlapped with other 
existing monitoring measures that, taken together , resulted in delays and increased financial costs 
for enterprises, thus creating unnecessary restrictions on international trade.  
13.8.   China urged the US to adjust the SIMP to ensure its WTO  consistency , and to avoid erecting 
new trade barriers ; in this way,  a normal bilateral flow of seafood trade between China and the US  
would again be possible . 
13.9.   The delegate of Norway  expressed Norway 's concerns over the US  SIMP's negative effects on 
its trade with the US, particularly as the US was a key market for Norway 's seafood exports. The 
Atlantic Codfish species had been included in the SIMP despite good management regimes being 
already in place for th e protect ion of codfish. The US  SIMP treated all seafood at species level and 
did not consider that various stock  components could have different stock  status and therefore be 
subject to different management regimes. Norway had an internationally recognized, well-
functioning management regime , and a good track  record in combatting IUU  fisheries.  
13.10.   The US  authorities had indicated that the SIMP would be extended to cover all seafood. This 
would constitute a fundamental departure from the risk -based approach that allowe d that importing 
countries could only implement such import restrictions in concrete cases supported by a  well-
documented  risk analysis.  
13.11.   The delegate of the United States  said that the SIMP 's objective was to combat IUU  fishing 
and seafood fraud. The final  rule required US  importers to report certain information upon entry into 
the US and to retain other information that allowed the shipment to be traced  back to the point of 
catch or harvest in order to prevent the US  market from being used as a place to sell fraudulently 
marketed seafood or seafood products from IUU  fishing.  
13.12.   The final rule was the result of a transparent process of public notice and comment involving 
all interested stakeholders , as well as direct outreach to exporting nations. Compliance with 
SIMP requirements for 11  priority sp ecies had come into  effect on 1  January  2018. The NOAA had 
recently published  a final rule that required two  additional species, shrimp and abalone, to comply 
with the SIMP  requirements as of 31  December  2018. Shrim p and abalone had been included in the G/C/M/132  
 
- 24 - 
 
  SIMP but had been stayed indefinitely as gaps were being identified in the traceability requirements 
for domestic aquaculture -raised shrimp and abalone.  
13.13.   NOAA was also working to promulgate a comparable domestic regula tion for the collection 
and retention of information for domestic aquaculture shrimp and abalone products. It was 
committed to advising shrimp and abalone importers and exporters on SIMP  requirements.  
13.14.   The Chairperson  proposed that the Council take note of the statements made.  
13.15.   It was so agreed . 
14  INDIA – CUSTOMS DUTIES ON I CT PRODUCTS – REQUEST FROM CANADA , CHINA, THE 
EUROPEAN UNION, JAPA N, NORWAY, AND THE U NITED STATES  
14.1.   The Chairperson  informed the Council that, in commun ications dated 21  June 2018, the 
delega tions of Canada, China, the European Union, Japan, Norway, and the United States, 
respectively, had requested the Secretariat to i nclude this item on the agenda.  
14.2.   The delegate of Canada  expressed Canada 's disappointment that, despite the concerns raised 
by WTO Members at the CTG , as well as at the Committees on Market Access (CMA) and the 
Information Technology Agreement (ITA),  India had, as part of its 2018 –2019 Budget, further  
increased its tariffs on a range of ICT  products above its zero  bound commitments in India 's 
Schedule of Concessions. This wa s inconsistent with India 's WTO  commitments and ran contrary to 
the objectives of multilateral tariff liberalization.  
14.3.   Canada had both systemic and commercial concerns over India's decision to introduce  tariffs 
on products that surpassed its bound rate , and found India 's justification unacceptable. India should 
immediately rescind the se tariff increases and refrain from pursuing any further tariff increases  
above its WTO  commitments.  
14.4.   The delegate of the European Union  said that India 's increased duty rates constituted a prima 
facie violation of India 's WTO  commitment s as the tariff lines in question were subject to duty -free 
treatment in India 's Schedule of Concessions. European industry, including European companies that 
had invested in India, was concerned about India 's move towards import substitution and increased 
protectionism. The "Make in India " initiative should not lead to foreign compa nies be ing increasingly 
concerned about the initiative 's protectionist impact or a bout India 's commitment to respecting 
WTO rules.  
14.5.   The EU disagreed with India 's claim that the products at issue were not covered by 
ITA-1 concessions. The panel in EC – IT Products  had concluded that a wide range of characteristics  
and technologies fell under  the scope of and were therefore covered by ITA-1 concessions, including 
certain products  that had not exist ed at the time that  the ITA-1 had been concluded.  
14.6.   Between 2017 and 2018, the EU 's Ambassador to India had addressed communications to the 
Indian Minister of Communications, the Electronic s and IT  Secretary, and the Revenue Secretary. In 
May 2018, the EU  Commissioner for Trade had also contacted the Indian Trade Minist er, indicating 
that the EU had been assessing all possible means of  finding a solution to the increased import 
duties.  
14.7.   The re-introduction  of and increases in import duties on ICT products had not only negatively 
impacted European and other foreign compani es but  had also led to higher prices for Indian 
consumers and hampered the deve lopment of "Digital India ". 
14.8.   The delegate of Japan  said that the current customs duty rates of 20% on mobile phones and 
15% on their parts violated India 's zero  per cent bound co mmitment at the six -digit level. Japan 
continued to have commercial and systemic concerns in this regard and  urged Indi a immediately to 
reinstate zero  duties on the ICT  products in question. Japan also requested to receive an official 
response to the communication that it had sent to the Indian authorities, specifying the legal issues 
and products  concerned . G/C/M/132  
 
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  14.9.   The delegate of the United States  expressed US concern s over India's continued actions to 
increase its duties on telec ommunication s and other ICT  products , which appeared to breach India 's 
WTO bound commitments. India had not yet responded to the concerns raised by numerous 
Members in the WTO and, to the contrary, had increased duties on additional ICT  products in early 
April 2018. The most recent increases, together with the implementation of India 's 
2018-2019 budget proposal, had doubled the list of ICT  products for which India had increased 
tariffs in the first half of 2018, and included product categories for which Ind ia had a WTO  duty-free 
bound obligation.  
14.10.   The US rejected India 's arguments that the products concerned were new technologies. Any 
product classified within the scope of a tariff category that was covered by India 's bound duty -free 
commitments must benefit from duty -free treatment even if it were a product that had not been on 
the market at the time when India had undertaken  its binding commitments.  
14.11.   The delegate of China  said that India 's increased tariff rates had exceeded its WTO  bound 
rates, were inconsistent with the ITA and with GATT  Article  ІІ, and nullified China 's interests. India 
should readjust its duty rates and bring them into conformity with its WTO bound rates.  
14.12.   The delegate of Norway  referred to Norway 's statement on this issue delivered  at the CTG 's 
previous meeting (see document  G/C/M/131 , paragraph  11.10 ), and emphasized that India 's 
interpretation , which implied that a product segment could automatically be released from binding 
commitments upon technological advancement , would seriou sly undermine the WTO  system.  
14.13.   The delegate of Thailand  reiterated Thailand 's commercial interest in the products in question 
and the systemic concerns and implications that would result from India's application of tariffs above 
its bound rates. 
14.14.   The delegate of the Republic of Korea  reiterated Korea 's systemic concerns over India's 
imposition of duties  on additional products under HS  tariff lines subject to the ITA tha t exceeded 
India's bound rates.  
14.15.   The delegate of Singapore  reiterated Singapore 's concern s over India's continued imposition 
of duties on ICT  products cove red by India 's ITA commitments.  
14.16.   The delegate of Australia  reiterated Australia 's concerns al ready expressed at previous 
CTG meetings regarding India's compliance with its WTO  obligat ions. 
14.17.   The delegate of Switzerland  said that Switzerland considered that IT  products listed in India 's 
Schedule of Concessions and bound at zero  rates should not be subject to any import duty when 
imported into India. In this regard,  the MFN  tariffs published by India for mobile phones were 
inconsistent with India 's commitment in its 2015  certified Schedule. Switzerland requested India to 
abide by its WTO  commitments.  
14.18.   The delegate of Chinese Taipei  expressed concern over India's increased import dutie s on 
seven  products, including mobile phones, digital cameras, microwave ovens, and other ICT  products 
listed in its 2018 –2019 budget proposal. Such increase s were totally inconsistent with 
GATT  Article  II. 
14.19.   The delegate of India thanked delegations for the ir continued interest in India 's customs 
duty regime on certain telecommunication s and other products.  
14.20.   With regard to the concerns raised over India's imposition of customs duties and its increases 
on certain IT and telecom items, as well as with regard to  India's views on the transposition of 
certain items such as cellular phones, PCBs, and base stations, under HS96 and HS2007, he indicated 
that India had already provided its written responses to the questions addressed to it in 
document  G/IT/W/45. India h ad also addressed  these concerns at various meetings of the CMA, the 
CTG, and the ITA  Committee.  
14.21.   With regard to products other than those allegedly contained in ITA -1, he said that, 
according to Members ' rights under the WTO, India had increased the duties within its bound rates G/C/M/132  
 
- 26 - 
 
  and, as evidenced over several decades, India had displayed caution when  raising any such duties 
despite the policy space it enjoyed at the WTO.  
14.22.   India was fully aware of its oblig ations and commitments under the ITA -1 and had been 
abiding by them. India had signed the ITA -1 in 1997 and had presented its Schedule of Concessions , 
which had been certified in document  WT/Let/181. India did not intend to make any commit ment 
beyond the s cope of its ITA -1 commitments . 
14.23.   There had been extensive stakeholder consultations among relevant agencies on the 
coverage of ITA -1 products and India 's ITA  commitments, and India considered that the items on 
which duties had been raised were not part of the ITA-1 that India had signed. He invited delegations 
to share their perceptions of the coverage of those products listed under the ITA-1, as well as on 
the customs duties imposed by other Members on such pro ducts.  
14.24.   The precise scope of the products covered  under ITA -1 was a complex matter , involving  
consideration of the technical nature and description of the items originally included, the 
technological innovations and developments that had occurred over time, as well as the fact that 
there was a strong pos sibility of certain ambiguities in the HS  transpositions that had taken place 
since ITA -1 had first come into  effect.  
14.25.   India remained willing  to consider any specific views regarding the technical aspects of the 
products at issue as well as their classifica tion, while keeping in perspective both the question of 
technological progression, as well as HS  transposition of telecom and IT  products. Capital -based 
experts likewise stood ready  to engage at the technical level with their counterparts from the 
complain ing Member in order to help them to better understand specific concerns and apprehensions 
and to resolve any issue in an effective manner.  
14.26.   With regard to India 's bound rates for certain specified products in its HS2007  Schedule , as 
notified to the WTO, he said that Members had the right to revisit it s Schedule  and to make the 
necessary rectification requests before the ITA  Committee. India was working on this  and would 
revert to the matter at Committee level.  
14.27.   The Chairperson  proposed that the Council take note of the statements made.  
14.28.   It was so agreed . 
15  MONGOLIA – QUANTITATIVE RESTRI CTIONS AND PROHIBITI ONS ON IMPORTATION 
OF CERTAIN AGRICULTU RAL PRODUCTS – REQUEST FROM THE RU SSIAN FEDERATION  
15.1.   The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of the Russian Federation had requested the Secretariat to include this item on the 
agenda.  
15.2.   The delegate of the Russian Federation  said that , in 2013 , Mongolia had established a quota 
regime for t he importation of certain agricultural products, including wheat flour, wheat, milk, 
drinking water, and beef. According to Mongolia 's Government Resolution No.  77 of 2  March  2013, 
each year the responsible authority determined the volumes of corresponding  quotas. Imports 
beyond those quotas were prohibited.  The resolution had also set out the basic criteria for 
determining quota volumes. The responsible authority calculated the quotas based on annual 
required importation and exportation of certain agricultural products. However, such a  system 
created uncertainty for Russian exporters. Indeed, Mongolia 's Ministry of Food, Agr iculture, and Light 
Industry had established an import prohibition on wheat flour, late in 2016, which remained in force. 
As a result, Mongolia 's wheat flour imports had dropped significantly , and Russian exporters had 
suffered substantial losses during th e course of the past  two years. The Russian Federation 
requested clarification from Mongolia with regard to  its import restrictions, covering both quotas and 
import prohibitions, and including an explanation of how these measures complied with Article  XI of 
the GATT, the general elimination of quantitative restrictions, and Article  4.2 o f the Agreement on 
Agriculture.  G/C/M/132  
 
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  15.3.   The delegate of Canada  said that , as a significant global exporter of wheat, Canada had a 
commercial interest in the use of measures that lim ited or restricted wheat imports. Despite the 
issue having been raised at the Council already in March  2018, no progress had yet been made.  
15.4.   The delegate of Australia  expressed his country 's concerns regarding Mongolia 's complianc e 
with its WTO  commitments.  
15.5.   The delegate of Mongolia  thanked the previous speakers for their interest in its measures. At 
the Council meeting of 23  March  2018, Mongolia had informed Members that the measures at issue 
had been introduced in accordance with the Laws on Food and Food S ecurity, which explicitly named 
only a few products, including flour, wheat, and milk, as strategic and staple foods that were 
essential for the livelihood and well -being of the people of Mongolia. Mongolia had held a bilateral 
meeting with the Russian Fed eration on 25  April 2018 at which it had informed the Russian 
Federation that a decision had been taken to abolish the import prohibition on wheat flour and milk. 
Moreover, a working group had been established  to address  the Russian Federation 's concerns , and 
the Council would be informed accordingly. Mongolia stood  ready to engage in further bilateral 
discussions with the Russian Federation and other interested Members.  
15.6.   The Chairperson  proposed that the Council take note of the statements made.  
15.7.   It was so agreed . 
16  EGYPT – MANUFACTURER REGIST RATION SYSTEM – REQUEST FROM THE EU ROPEAN 
UNION  
16.1.   The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of the European Union had requested the Secretariat to i nclude this item on t he agenda.  
16.2.   The delegate of the European Union  said that , despite numerous bilateral exchanges following 
the TBT  Committee and CTG  meetings , the implementation of the two  Egyptian Ministerial Decrees, 
No. 1991/2015, and N o. 43/2016, respectively, continued to create unnecessary obstacles to trade. 
The EU industry, especially small and medium -sized enterprises (SMEs), continued to report serious 
difficulties with regard to duplication of procedures and, in particular, to long delays in the 
registration process. Moreover, the process was not transparent, as the list of registered companies 
had not been made available to the public . The EU asked Egypt to suspend application of the 
measures, to review them in light of WTO  principl es, and to re -notify them under the 
TBT Agreement.  
16.3.   Without prejudice to the EU 's request that Egypt suspend the application of the measures  at 
issue, the EU wished also to encourage the Egyptian authorities to consider certain  improvements 
to the implement ation of the Decrees, in particular, and as mentioned on other occasions: (a)  setting 
a strict deadline for the decision on registration requests; (b)  creating a publicly accessible database 
of registered companies; (c)  providing companies with an opportun ity to appeal in the case of a 
refused registration; and (d)  registering without further delay all the companies that had already 
submitted their complete documentation and that were awaiting ministerial approval of the ir 
registration. The EU also encourag ed Egypt to avoid the need for repeated registrations by the same 
companies for the same products in various registries. Once a company had been listed as a "trusted 
importer " under Decree  991, this should already be considered sufficient assurance of the quality 
and safety of its products. The EU called upon Egypt to take these comments into account and to 
inform Members of the steps being taken to make its manufacturer registration system less 
burdensome for companies.  
16.4.   The delegate of Switzerland  reiterated her country 's ongoing  concern over Decree 
No. 43/2016. The non -transparent application of the quality certification and registration 
requirements, the lack of time-periods  for the registration process , and the subsequent  decree by 
the Minister of Foreign Trade resulted in a significant  additional burden for the industry. Switzerland 
was concerned that the se requirements had driven Swiss companies out of the Egyptian market. 
She thanked Egypt for their bilateral exchanges on the issue and looked forward to further 
construc tive cooperation on this topic.  G/C/M/132  
 
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  16.5.   The delegate of Brazil  indicated that some Brazilian exporters had also reported delays in the 
registration process or in the renewal of their registrations; this was a source of uncertainty with 
regard to their commercial relationships in Egypt. If it were not possible for Egypt to suspend these 
requirements entirely, Brazil encouraged Egypt at least to implement them in a less burdensome 
way. 
16.6.   The delegate of Egypt  thanked previous speakers for the ir interventions and  referred them to 
Egypt 's replies contained in the minutes of the previ ous meetings of the CTG and TBT  Committee.2 
16.7.   He noted that , in the first four  months of 2018, Egyptian imports had increased by 22% when 
compared to the same period in 2017. This indicated that Egypt was not imposing restrictions on 
imports from its trading partners, and also showed that the registration requirements under Decree 
No. 43/2016 were not more trade restrictive than necessary. This registration process was  
administrative in nature and any credible manufacturer could easily comply with its requirements. 
Moreover, the Decree did not impose further burdens on producers or companies to comply with 
specific technical regulations but instead  provided credible pro ducers with a better competitive 
environment in the Egyptian market.  
16.8.   In order to address the issue of  possible delays resulting from the verification of documents 
or the large number of applications, and in response to the concerns of its trading partners,  the 
Egyptian authorities had made significant  efforts to accelerate the registration process and improve 
its transparency. In this regard , his delegation would hold bilateral discussions with interested 
Members , under  the scope of the TBT  Committee , on any remaining obstacles to the Decree 's 
implementation.  
16.9.   Egypt periodically reviewed and assessed its measures and regulations that affected imports , 
and its foreign trade in general, with the ultimate goal of enhancing Egypt 's business environment 
and to facilitating trade. Egypt remained ready to engage constructively with any interested 
delegation and to provide assistance to foreign companies regarding any implementation obstacles  
they may be facing . 
16.10.   The Chairperson  proposed that the Council take note of the statements made.  
16.11.   It was so agreed . 
17  PAKISTAN – MEASURES RELATING T O SUGAR EXPORTS – REQUEST FROM AUSTRA LIA 
AND THAILAND  
17.1.   The Chairperson  informed the Council that, in communications dated 21  June 2018, the 
delegations of Australia and Thailand, respectively, had requested the Secretariat to include this 
item on the agenda.  
17.2.   The delegate of Australia , when referring to Pakistan 's measures affecting sugar exports , 
sought confirmation that Pakistan 's freight sup port had ended on 31  May 2018, as had been stated 
by Pakistan at the June  2018 meeting of the Committee on Agriculture (CoA). Australia would also 
welcome more detailed responses to its questions posed at that  meeting and  expected all 
WTO Members to take t heir obligations seriously. It would closely monitor developments regarding 
sugar measures in Pa kistan.  
17.3.   The delegate of Thailand  expressed Thailand 's concern that Pakistan 's cash freight support on 
exports of approximately 2  million tonnes of sugar could negatively impact the international sugar 
market and  requested Pakistan 's confirmation that the freight programme would not be continued. 
Thailand invited Pakistan to provide detailed clarification of the measure, together with an update 
on the status of possible amendment s to its sugar subsidies programme and any relevant reforms 
to be undertaken.  
17.4.   The delegate of Guatemala  expressed his country 's concern over this issue, both as a sugar 
producer and as a sugar exporter. Guatemala would continue to follow this issue closely . 
                                                
2 Document  G/C/M/131, paragraphs  15.7–15.9, and document  G/TBT/M/75, paragraphs  4.134 -4.135.  G/C/M/132  
 
- 29 - 
 
  17.5.   The delegate of Canada  said that the sugar industry was concerned by the effect s of Pakistan 's 
support measures on the international sugar market. Canada encouraged Pakistan to reconsider its 
measures and to refrain from exporting sugar  that had benefitted from subsidies.  
17.6.   The delegate of Brazil  shared the concerns expressed by other Members regarding the trade -
distorting effects, actual or potential, as well as  the WTO  consistency , of support measures and 
policies adopted by Pakistan in relation to its sugar exports. Brazil would continue to follow this issue 
closely.  
17.7.   The delegate of Pakistan  recalled that Pakistan had been addressing these  concerns at 
meetings  of the CoA and had also held bilateral discussions on the issue  with various M embers . 
Members ' concerns had been duly conveyed to Capital. The measure, which had been consistent 
with the Agreement on Agriculture, had already expired. Nevertheless, Pakistan would continue to 
engage constructively with Members to further clarify their concerns.  
17.8.   The Chairperson  proposed that the Council take note of the statements made.  
17.9.   It was so agreed . 
18  INDIA – MEASURES RELATING T O SUGAR EXPORTS – REQUEST FROM AUSTRA LIA AND 
THAILAND  
18.1.   The Chairperson  informed the Council that, in communications date d 21 June 2018, the 
delegations of Australia and Thailand, respectively, had requested the Secretariat to include this 
item on the agenda.  
18.2.   The delegate of Australia  expressed Australia 's concern over India's failure to respond 
substantively to the question s raised by Australia at numerous WTO  Committees regarding India 's 
sugar overproduction, including substantial new financial support announced on 6  June 2018. 
Australia remained concerned by the WTO  consistency of India 's sugar export arrangements.  
18.3.   He soug ht clarifi cation from India regarding the WTO  basis for India's mandatory requirement 
to export 2  million tonnes of sugar  in 2017 -2018, as announced on 28  March  2018, and new 
payments to the sugar industry, as announced on 9  May 2018. Furthermore, what was  the 
WTO basis for India's duty -free import authorization scheme , which waived future import duties on 
sugar between 2019 and 2021 for those millers that had exported sugar before 30  September  2018? 
The Australian Government was committed to defending Aust ralia's trade interests.  
18.4.   The delegate of Thailand  said that the measures announced by India, which included a 
2 million tonne export quota for all grades of sugar, a minimum indicated e xport quota, the removal 
of 20%  export duty on sugar, an increase in th e import tariffs on sugar from 50% to 100%, and 
financial assistance to sugar mills for clearing cane juice for farmers, could adversely affect the world 
sugar market. Thailand requested India to provide a detailed written clarification of each measure. 
In addition, Thailand had yet to receive any substantial response to the questions that it had 
addressed to India at the previous CoA  meeting . 
18.5.   The delegate of the European Union  said that her comments on this issue also applied to the 
previous agenda item , "Pakistan – Measures Relating to Sugar Exports ". The EU fully shared the 
views expressed by Australia and Thailand, and recalled that her delegation had already expressed 
its concern , at the CoA 's previous  meeting , over the introduction of export subsidies following the 
Nairobi Ministerial Decision. The recent development showed the need for Members that could 
benefit from Article  9.4 of the Agreement on Agriculture to correctly report their actions. The EU was 
especially concerned by India's announcement , in the week of 25  June 2018, indicating that India 
would support the export of 60,000  tonnes of skimmed milk powder from the dairy company Amule.  
18.6.   The delegate of Canada  said that India was currently experiencing a surge in sugar production 
and that it had subsequently introduced  a suite of measures to support the domestic price of sugar. 
These  measures were having a spill over effect on to international sugar markets.  G/C/M/132  
 
- 30 - 
 
  18.7.   Canada 's sugar industry was concerned by India's use of support mechanisms to export sugar 
and the resulting dampening effect on the world sugar market. Canada, therefore, encouraged India 
to reconsider its measures and to refrain from exporting sugar using subsidies.  
18.8.   The delegate of Brazil  shared the concerns of other Members regarding the trad e-distorting 
effects, actual or potential, and the WTO  consistency , of support measures and policies adopted by 
India in relation to its sugar exports. Brazil would continue to follow this issue closely.  
18.9.   The delegate of Guatemala  said that Guatemala,  as an  exporter of sugar, was concerned by 
the measure and its impact on the global sugar economy. Guatemala would continue to follow this 
issue closely . 
18.10.   The delegate of India said that, on 28  March  2018, India 's Department of Food and Public 
Distribution had in dicated a quota of 2 million tonnes for export by the sugar mills. Questions had 
been asked at the CoA  meeting held in June  2018, at which partial responses had been provided to 
the questions  posed . The measure had been introduced  only recently ; therefore , the responses to 
issues like the administrative implementation of the measure would be provided to the CoA  in due 
course . 
18.11.   India had introduced  a basket of measures to alleviate the suffering of small and marginal 
sugar farmers because of non -clearance of dues of sugarcane farmers by sugar mills, including 
incentives for increasing internal production capacity and for upgrading sugar  plants so as to enable 
them to operate on an increased number of working days.  
18.12.   India's duty -free import authorization scheme had been available since 2007 and neutralized 
the duty on imports incurred in the manufacture of the finished product, which was permitted under 
the SCM  Agreement. He asked if Australia had a specific issue with regard to t he scheme . 
18.13.   With regard to the issue raised by the EU on dairy product support, India would discuss this 
further with the  EU bilaterally . 
18.14.   The Chairperson  proposed that the Council take note of the statements made.  
18.15.   It was so agreed . 
19  CROATIA – REGULATION OF I MPORT AND SALE OF CE RTAIN OIL PRODUCTS – 
REQUEST FROM THE RUS SIAN FEDERATION  
19.1.   The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of the Russian Federation had requested the Secretariat to i nclude this item on the 
agenda.  
19.2.   The delegate of the Russian Federation  reiterated the concerns of his delegation regarding 
Croatia 's Decree of 2014 on the procedure for wholesale trade with third  countries of certain types 
of goods. For example, p aragraph  3 of Article  2 of the Decree established a minimum volume of 
containers for wholesale trade in certain oil products – 300m3 for oil products and  100m3 for biofuel s. 
Paragraph  2 of the same article indicated that the requirements regarding minimum volume of 
containers f or wholesale should be applicable to all imports except imports from the European Union 
member States, the European Economic Area, and the Republic of Turkey. Consequently, petroleum 
products from those countries enjoyed more favourable treatment in Croati a compared to similar 
products imported from the Russian Federation. Such a differentiated wholesale trade regime was 
in violation of  Croatia 's obligations under GATT  Article  I and other WTO  provisions.  
19.3.   Although  the Russian Federation had raised this issue bilaterally  with the EU , and also during 
the April meeting of the Committee on Market Access, there had been no change or  developm ent on 
the EU  side, and nor  had Russia received any information from the EU with regard to a potential 
modification or recons ideration of the Decree. The Russian delegation requested the EU to provide 
furthe r clarification of this issue.  
19.4.   The delegate of the European Union  said that Croatia continued to revise its regulation s on 
imports of certain oil products , and that the  resulting revised measures would be fully consistent G/C/M/132  
 
- 31 - 
 
  with WTO  law. Preparations for the revision were taking longer than expected due to the currently 
ongoing consideration of a reallocation of responsibility for those measures between different 
governmen tal ministries of Croatia. The EU would inform the Council as soon as the revised measure 
became  available.  
19.5.   The Chairperson  proposed that the Council take note of the statements made.  
19.6.   It was so agreed . 
20  VIET NAM – DECREE ON THE REGUL ATION ON CONDITIONS FOR AUTOMOBILES 
MANUFACTURING, ASSEM BLING, IMPORTING, AN D AUTOMOTIVE WARRANT Y AND 
MAINTENANCE SERVICES  – REQUEST FROM JAPAN A ND THE UNITED STATES  
20.1.   The Chairperson  informed the Council that , in communications dated 21  June 2018, the 
delegations of Japan and the United States had requested the Secretariat to include this item on the 
agenda.  
20.2.   The delegate of Japan  said that the impact on the export of automobiles to Viet Nam of Viet 
Nam's Decree  No. 116 of 1  January  2018 had been significant, and requested Viet Nam quickly to 
take measures to improve the system, while considering also the comments that had been submitted 
by industry stakeholders. In particular, Japan noted that, in relation to the import of finished 
automobiles, Viet Nam 's Decree  No. 116 required the  submission of a copy of the quality certificate 
of automobile types issued by foreign authorities. Japan believed that such form of re gulation was 
without precedent.  
20.3.   Since domestically produced automobiles required only vehicle type approval issued by the  
Vietnamese authorities, Japan requested that the same treatment be applied also to imported 
automobiles. As for the requirement for a security/emissions inspection and test, carried out lot -by-
lot, Japan noted that, in comparison with domestically produce d automobiles, imported automobiles 
were subject to stricter and less favourable treatment in terms of the frequency of inspections. Japan 
therefore requested that the same treatment be granted to imported automobiles as applied to 
domestically produced au tomobiles. At the same time, Japan urged Viet Nam to ensure that its 
measures were in accordance with WTO  principles, which stipulated that Members not discriminate 
between domestic and foreign products or impose greater trade restrictions than necessary t o fulfil 
a legitimate policy objective.  
20.4.   The delegate of the United States  supported Japan 's comments. The US continued to have 
significant  concerns over both the substance and the timing of Viet Nam 's Decree  No. 116. Decree  
No. 116 had imposed new restrict ions on imported motor vehicles given its  almost immediate and 
burdensome new certification and testing requirements , which had disrupted trade for US  auto 
companies. The US requested Viet Nam immediately to suspend its implementation of Decree 
No. 116 and  its implementing circular, and instead to develop a long -term and workable solution 
that did not effectively close the marketplace to foreign vehicles. The US  also requested that the 
decree and circular be amended in consultation with industry stakeholder s and the US  Government , 
so that US  automobile manufacturers could again resume exporting their vehicles into Viet Nam.  
20.5.   The delegate of Thailand  said that Thailand was concerned by the serious impact of Decree 
No. 116 on the trade in automobiles. The implementation of Decree No. 116 was inconsistent with 
Viet Nam 's WTO  obligations and had been undertaken in a non -transparent, trade restrictive, and 
discriminatory manner. Furthermore, Members ' automotive industries  had not been  afforded a  
reasonable time-period between the publication and entry into force of the Decree, given that  
importers needed several months of lead -time prior to importation. The Decree also required Vehicle 
Type Approval (VTA) certificates and inspections f or every lot of imported cars, which unreasonably 
increased the cost of imports , besides being  also inconsistent with international practice. In addition, 
it also appeared that cars of Vietnamese origin were treated more favourably than those originating 
in other countries, since their testing results and  certificates were valid for 36  months, whereas 
imported cars were subjected to lot -by-lot inspection. Thailand urged Viet Nam to suspend the 
requirement for the inspection and testing of each shipment, and  to take Members ' concerns into 
consideration . It also urged Viet Nam to  honour its obligations under the WTO and to eliminate all 
unnecessary obstacles to international trade.  G/C/M/132  
 
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  20.6.   The delegate of Canada  echoed the concerns raised by other Members over Viet Na m's 
automobile measure in Decree No. 116. The automotive industry was a n important sector in  the 
Canadian economy , and some of its industry stakeholders had raised their concerns with regard to 
Decree No. 116, especially over  the Vehicle Type Approval Certificate requirements and the lot -by-
lot testing. Canada requested  Viet Nam to confirm whether it planned to m odify, delay, or suspend 
Decree  No. 116. 
20.7.   The delegate of the European Union  shared the concerns of other Members regarding Viet 
Nam's Decree No. 116. The new testing procedures and the request for a vehicle type approval 
certificate different from that of the UNECE would create delays at customs and impose additional 
costs on EU exporters, which would in turn harm their  long-term competitiveness vis -à-vis locally 
manufactured automobiles . 
20.8.   The EU regretted that, while the Decree had entered into force on 1  January  2018, it had 
been notified to the TBT  Committee only on 7 March  2018, thus not allowing Members time to 
comme nt on it. The EU recalled that, to be in accordance with the TBT  Agreement, notifications to 
the WTO should take place at an early and appropriate stage, when amendments to the measure 
could still be introduced , that a reasonable time for comment should be  allowed for  Members ' 
comments , and that these comments should  then be taken into consideration. Since the 
implementation in early  2018 of Viet Nam 's Decree  No. 116, car imports into Viet Nam had 
plummeted; this clearly demonstrated that the measure create d an unnecessary barrier to trade.  
20.9.   The EU requested Viet Nam to postpone the application of Decree No. 116 so as to allow 
sufficient time to receive Members ' comments and to involve all stakeholders, including importers 
of foreign cars, in the current cons ultations to develop further legislation. Furthermore, Viet Nam 
should allow for a reasonable interval of time between the publication and the enforcement of the 
adopted measures  in order  to afford producers from exporting Members sufficient time to adapt their 
products or methods of production to new Vietnamese requirements. Finally, the EU emphasized 
that conformity assessment procedures should not be prepared, adopted, or applied with a view to, 
or with the effect of, creating unnecessary obstacles to tr ade. 
20.10.   Finally, the EU noted that  Viet Nam 's written response s to its comm ents, submitted through 
the TBT  Contact Point, were not relevant to the questions actually posed by the EU; additionally , 
responses  should in any case be substantiated with objective d ata and analysis. Specifically, the 
EU concerns on discrimination against  imported vis -à-vis domestically produced vehicles , stemming 
from Article  6 of the Decree , had not yet been addressed. The EU therefore requested Viet Nam to 
reconsider its concerns . 
20.11.   The delegate of the Russian Federation  shared Members ' concerns regarding Viet Nam 's 
Decree  No. 116, and requested Viet Nam to suspend the application of the Decree and to provide 
sufficient time for Members to comment on it. 
20.12.   The delegate of Viet Nam  said that the objective of Decree No. 116 was to protect customer 
safety and contribute to environment al protection efforts. The VTA  requirement was mandatory not 
only for imported but also for domestically manufactured and/or assembled automobiles. Since its 
entry into force, Viet Nam 's Register Authority of the Ministry of Transport had accepted 
119 applications for imports of 56  different types of motor vehicle. It had also granted technical and 
environment al safety certificates for 26  types of vehicle , thus  enlarging the number of automobiles 
allowed to circulate in the domestic market. To date, many car manufacturers and exporters from 
the United States, the Republic of Korea, Thailand,  and the European Union had successfully cleared 
all the  necessary  impor t procedures such that their automobiles were now ready for sale in Viet 
Nam.  
20.13.   The lot -by-lot testing and inspection applied to imported automobiles was intended to ensure  
uniform quality across  vehicles. Indeed, such measure s were applied by many countries  together  
with type -approval requirement s. Therefore, it could not be straightforwardly concluded from such 
measures and requirements that automobiles imported into Viet Nam were subject to stricter and 
less favourable  treatment than domestically manufactu red automobiles in terms of frequency of 
inspections. His delegation would in any case convey Members ' comments to Capital . 
20.14.   The Chairperson  proposed that the Council take note of the statements made.  G/C/M/132  
 
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  20.15.   It was so agreed . 
21  CHINA – MEASURES RESTRICTIN G THE IMPOR T OF SCRAP MATERIALS  – REQUEST 
FROM AUSTRALIA AND T HE UNITED STATES  
21.1.   The Chairperson  informed the Council that, in communications dated 21  June 2018, the 
delegations of Australia and the United States, respectively, had requested the Secretariat to include 
this item on the agenda.  
21.2.   The delegate of the United States  reiterated her country 's concern over China 's measures 
notified on 18  July 2017 to the TBT  Committee, and their subsequent implementation banning or 
severely limiting the import of scrap materials (CHN 1211 and 1212). The notified measures banned 
the import of scrap post -consumer plastics, mixed paper, and textiles, and set new border inspection 
and identification rules for materials that China classified or qualified as "waste ". China had 
implement ed these measures on 31  December  2017. On 15  November  2017, China had also notified 
CHN 1224 to 1234 restricting the import of a variety of scrap materials through revised quality 
parameters; the commodities covered included industrial plastics, paper and paperboard, non -
ferrous scrap and wire, ferrous scrap and wire, and metal and electrical appliance scrap, among 
others. These new barriers had entered into force on 1  March  2018. In many cases, the new quality 
parameters were technically infeasible and , as a result , acted as a de facto  ban on the import of  
many scrap materials.  
21.3.   Most recently, China had announced an expansion of its import ban to include most plastics 
and all wood, automotive, appliance, electric motor, and vessel scrap. China had noted that  it did 
not intend to not ify the new measures to the TBT  Committee. Furtherm ore, in May  2018, China had 
announced and then implemented on the following day, new border inspection rules requiring 
100%  inspection and lab testing at the border for all scrap c ommodities ; on that  same day, China 
had also arbitrarily halted pre -shipment inspection in the US for a period of 30  days, leading to a 
complete halt in US  exports of recycled commodities to China. These  measures outright banned or 
effectively banned imports of scrap materials that were destined for recycling and reuse in 
downstream manufacturing processes.  
21.4.   While the US recognized and appreciated China 's interest in addressing environmental 
concerns, including potentially by pursuing measures to improv e its management of recovered scrap 
materials, the approach that China was taking appeared to be having the opposite effect. The US 
had observed that these new barriers had entered into force without any reasonable time interval 
during which industry could  make the necessary adjustments to their supply chains. As the world 's 
largest processor of scrap materials, China 's implementation of the measures had had an immediate 
and significant impact on global recycling networks. Further, the abrupt implementation  of the 
measures had created a global shortfall in recycling capacity that had undermined the value of 
recycled commodities, forcing recyclers that had not been able to locate alternative processing 
facilities to dispose of otherwise valuable recycled comm odities.  
21.5.   The measures also concerned China 's national treatment obligations. China had no mandatory 
commensurate domestic standard in place for a vast number of materials outlined in China 's ban 
and import control standards. The broadly trade restrictive n ature of the import control measures 
and apparent fundamental differences between requirements for foreign and domestic commodities 
also raised concerns.  
21.6.   Finally, China 's recent refusal to notify new technical measures consistent with its 
TBT obligations, as well as its arbitrary and abrupt halt to pre -shipment inspection in the United 
States,  had heightened US  concerns over the intent ion of the actions and their consistency with 
China 's WTO  obligations.  
21.7.   The US requested China immediately to halt implementa tion of the measures and to revise 
them in a manner consistent with existing international standards for trade in scrap materials, which 
provided a global framework for transparent and environmentally sound trade in recycled 
commodities.  
21.8.   The delegate of Australia  stated that his country appreciated China 's efforts to reduce pollution 
through a broad range of measures. However, the Australian Government had a number of concerns G/C/M/132  
 
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  with regard to  China 's measures on certain waste and scrap imports . The measures would have a 
significant impact on Australian exporters, and might cause a large amount of waste to go to landfill, 
instead of being recycled in China and recovered for intermediate materials. Australia would 
appreciate further information on what were the  specific public health, animal or plant, and 
environmental protection objectives, and how these would be fulfilled by the measure. Australia 
questioned whether the measure was more trade restrictive than necessary to achieve the desired 
objectives, and so ught clarification as to what measures were applied to China 's domestic waste 
products, how such measures were enforced, and if the domestic waste contamination standards 
were the same as those for foreign waste. If not, then what were the reasons for such  different 
standards. Australia urged China to reconsider these standards and to allow for a comprehensive 
consultation process.  
21.9.   The delegate of the European Union  said that the EU shared the environmental objectives of 
China that were behind this measure.  However, the short time-period  provided for the entry into 
force of China 's measures would have a counter -productive effect in the short term. Indeed, the  
scheduled exports to China would be rerouted to third  countries that might not have adequate 
facilities for safe recycling, or end up in landfill or incineration, thus resulting in a negative impact 
on the global environment. A more reasonable time -period would be necessary in order to avoid 
such undesirable effects. Furthermore, the short time -period did not allow for a discussion in the 
TBT Committee of the notified measures, including comments on the lack of clarification in relation  
to the products affected, the science -based justification for the measures , in particular contaminant 
levels, the possible alternative measures available to fulfil the same environmental goals, and the 
application of similar measures to domestic production. The EU sought clarification on how the 
implementation was being controll ed, and especially with regard to all the relevant customs 
procedures.  
21.10.   Furthermore, the import ban for end -of-life vessels that China intended to put in place in 
2019 would in all likelihood  also undermine global efforts to upgrade ship recycling stan dards , as 
set down in the 2009  Hong Kong Convention. The EU asked for China 's view on the rationale behind 
its measure, notably its links to the Hong Kong Convention, and if exemptions to the ban would  or 
could be considered.  
21.11.   The delegate of Canada  shared the c oncerns raised by previous speakers regarding China 's 
restrictions on the importation of solid waste and resultant disruptions in trade and uncertainty for 
traders. China 's prohibition on imports of recyclable post -consumer plastics, even those that met 
the standard applicable to the same products from industrial sources, should not be unnecessarily 
trade restrictive. Canada encouraged China to ensure that any trade measures implemented in 
pursuit of its objective to limit harmful environmental impact be th e least trade restrictive possible.  
21.12.   The delegate of the Republic of Korea  encouraged China to share with Members sufficient 
information on its relevant decisions , and also to implement its measures in the least  trade restrictive 
manner. The impact of China 's measures on trade in Korea 's relevant domestic industries had 
already been substantial, and Korea would be carefully following any future developments.  
21.13.   The delegate of China  stated  that, in accordance with internationally recognized principles 
of waste generator responsibility and disposal to the nearest, every country had the obligation to 
dispose of its domestically generated solid wastes. Accordingly, each Member was obliged properly 
to dispose of their domestically  generated solid wastes. As the developing country with the largest 
population, it was imperative that China improve its domestic solid waste treatment and disposal 
while also restricting and prohibiting imports of solid wastes. Given the need to protect the 
environment and public health  it was imperative to control and regulate imports of solid waste. In 
the adjustment process relative to its  relevant policies, the Chinese Government would take into full 
consideration the demands of both domestic and international communities, coordinate eco nomic 
growth and environmental protection, balance trade and non -trade interests, and safegu ard a 
smooth transition policy.  
21.14.   Companies from many WTO  Members had exported huge quantities  of solid waste to China 
over decades and had , in consequence , gained enormous economic benefit. China hoped that these  
exporting Members would  now actively shoulder their international responsibilities while at the same 
time making their due contribution. All Members should be working hard to reduce, reprocess , and 
recycle the waste produced within their own territory, thereby resolving the issue of waste material G/C/M/132  
 
- 35 - 
 
  in an appropriate manner , while also  contributing to the global promotion of green , low carbon, 
sustainable development, and the creation of a clean and bea utiful world.  
21.15.   The Chairperson  proposed that the Council take note of the statements made.  
21.16.   It was so agreed . 
22  INDIA – QUANTITATIVE RESTRI CTIONS ON IMPORTS OF  CERTAIN PULSES – REQUEST 
FROM AUSTRALIA, CANA DA, AND THE UNITED S TATES  
22.1.   The Chairperson  informed the Council t hat, in communications dated 21  June 2018, the 
delegations of Australia, Canada, and the United States, respectively, had requested the Secretariat 
to include this item on the agenda.  
22.2.   The delegate of Australia  expressed his Government 's serious co ncerns over India's 
restrictions on imports of pulses. Since August  2017, Australia had made repeated representations 
to India about its trade restrictions, including at Prime Ministerial level. When Australia had first 
raised its concern , at the June  2018 Committee on Agriculture, India had said that it had recently 
lodged a notification of its quantitative restrictions to the Committee on Market Access.  
22.3.   India's notification on Quantitative Restrictions (QRs), dated 21  June 2018, contained a 
reference to its import licensing notificatio n but failed to clarify the WTO  basis for 'its QRs on certain 
pulses. However, India had declined to respond to Australia 's questions  on this matter  at the meeting 
of the WTO  Comm ittee on Import Licensing on 20  April 2018.  
22.4.   In light of India 's confusing replies to the questions addressed  to it, Australia sought further 
clarification concerning  the WTO  basis for India 's QRs, a s well as about India 's 100,000  tonne QR on 
peas, that had been  announced on 25  April 2018, and that ha d lapsed on 30  June 2018, and in 
particular whether India 's latest notification granted an additional quota, such as an additional 
100,000  tonnes, or whether the original 100,000  tonne quantitative restriction applied from 25  April 
until 30  September  2018.  However, with no warning  notice , India had announced that its QRs on 
peas had been extended until 30  September  2018.  
22.5.   Australia believed that India 's extension of the QR  period without providing additional quota 
access might constitute an effective prohibition on imports. India sho uld also clarify whether or not 
the 7%  export incentive under the Merchandise Exports from India Scheme for exports of chickpeas, 
active from 21  March until 20  June 2018, had  indeed  now lap sed. Australia expected all 
WTO Members to take their obligations seriously and was closely monitoring developments in India's 
trade regime . 
22.6.   The delegate of Canada  said that , as the largest supplier of pulses to  India, Canada had been 
most negatively affected by India 's recent measures to limit the import of pulses , which were an 
important source of protein for many Indian consumers. Since November  2017, Canada 's exports  
value  of pulses  to India , including dry pe as, had drastically declined. Canada had exported a monthly 
average value of $7.6  million in pulses to India from November  2017–April 2018, as compared to a 
monthly average value of $120.1  million during the same period of the previous year. Canada 's 
average monthly value of exports of dry peas had dropped from $63.8  million to $3.6  million over 
the same period.  
22.7.   The elimination of quantitative restrictions was a fundamental principle of both the GATT and 
the Agreement on Agriculture. It was therefore  disappointing that , on 25  April 2018, India had 
introduced a quantitative restriction on imports of dried peas ( HS0713 –1000) (through Notification 
No. 4/2015–2020). This QR, originally announced for the period from 1  April 2018 to 30 June 2018, 
had been e xtended through Notification No.  15.2015–2020, until 30 September  2018. The date of  
this notification had been extended , while the total volume associated with the restriction remained 
the same . Canada was not only disappointed with the extension of the re striction on imports of dried 
peas beyond the original termination date of 30  June 2018,  but was also concerned by India's lack 
of transparency with regard to  its QR  restriction. Canada sought clarification from India on the 
WTO basis for its QR. G/C/M/132  
 
- 36 - 
 
  22.8.   At the June 2018 meeting of the CoA, India had indicated that its QR on dried peas had been 
included in notifications submitted to the Committee on Import Licensing Procedures (CILPs) and 
the CMA. However, India 's quantitative restriction on dried peas had not been listed in Section  1 of 
India's notification, document  G/MA/QR/N/IND/2. Section  2 of this notification cross-referenced 
India's notifications to the CILPs and indicated that the "WTO Justification and Grounds for the 
Restriction " included in the notifica tion was simply "GATT  1994". Canada looked forward to further 
discuss ion of India's notification at the next CMA  meeting but, in the meantime, requested India to 
provide fu rther detail on a specific WTO  Agreement and provision under which its QRs on dried peas 
could be justified . 
22.9.   The delegate of the United States  expressed her concern that , in 2017 and 2018 , India had 
adopted a number of trade -distorting policies in relation to various pulses. The se policies had 
included multiple increases in tariff rates, the introduction of quantitative import restrictions, and 
import -limiting licensing arrangements. In addition to the quantitative restrictions on certain pulses 
introduced in 2017, the Indian Ministry of Commerce and Industry had also published Notification  
No. 4/2015–2020, on 25  April 2018.  
22.10.   The United States asked India to provide clarity by answering the following questions.  What 
was the basis for the introduction of these  measures , and how could they be said to comply with 
India's WTO commitme nts? Were the notified quantitative restrictions announced in 2017 still in 
place? Did India have plans to institute additional  QRs on imports of agricultural products and, if so, 
on which products?  
22.11.   Additionally, the US had not yet received responses to th e questions that it had addressed 
to India at the CoA's February and June  2018 meetings, see king clarification of its QRs.  
22.12.   The delegate of Ukraine  shared the concerns  of other Members . Ukraine sought clarification 
from India with regard to the measure s at issue, which from a systemic point of view  had resulted 
in a negative impact on trade. Ukraine called upon India to provide transparency and predictability 
in its trade policies.  
22.13.   The delegate of the European Union  expressed concern over India's management of its pulse 
crop markets over recent months , the implications of which for trade and traders  were severe . 
Furthermore, the EU was not convinced that the measures taken were in the long-term interest s of 
pulse producers, including those in Ind ia. As a consequence of the increased duties on pulses, 
EU exports, mostly peas, had come nearly to a standstill ; and EU farmers had been directly affected , 
since the prices for pulses in the European market had decreased as a consequence of India's 
measur es. The EU was also concerned by India's QRs , and their im plementation.  
22.14.   The delegate of New Zealand  was concerned over the apparent limitation of a quantitative 
restriction, which would be in contravention of the rules set out in the WTO  Agreement , and  
encouraged India promptly to bring its measures into conformity with  the WTO 's rules and principles.  
22.15.   The delegate of Singapore  said that her authorities were closely monitoring the situation.  
22.16.   The delegate of the Russian Federation  expressed his authorities ' concern over the policy 
applied by India with regard to the import of yellow peas , whose import  tariffs were increased by 
India,  in November  2017, by up to 50%. In addition, in April  2018, India had introduced a QR on 
imports of yellow peas restricting to 100,000  tonnes the quantity of yellow peas allowed to be 
imported durin g the period from 1  April until 30 June 2018. Russia believed that WTO  Members were 
not permitted to apply quantitative restrictions without proper justification, and requested India to  
indicate the rationale behind its measure, to confirm whether or not the measure were still in force, 
and to repeal the extension of the restriction.  
22.17.   The delegate of India said that India had already notified its measures to the CILPs , and the 
CMA, and that it also had responded to Members ' concerns  at the CoA's June 2018 meeting.  
22.18.   With India being the world's largest producer and consumer of pulses, the decision to impose 
a quota was based on domestic demand and supply situation, and was intended to  alleviate the 
distress caused to small and marginal farmers by an influx of cheap imported pulses , and its 
consequent impact on food and livelihood security. It had been observed  that in the case of certain G/C/M/132  
 
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  pulses, a mere increase in import tariffs was in sufficient. The objective of India's  agricultural policy 
was to balance the interests of consumers and producers.  
22.19.   The Wholesale Price Index (WPI) for pulses in India had dropped  from 205.2 in 
December  2016 to 134.2 in December  2017, and had further dropped, to 120.8 , in April  2018, 
revealing a sharp decline during this period. This fact showed that current prices of pulses in 
domestic markets were below those from the corresponding period of the previous year, and 
confirmed that the measures taken we re in the overall interests of both consumers and producers. 
Therefore, the Government 's imposition of QRs on pulses was intended to protect India 's small and 
marginal farmers. Given the circumstances, the measure had to be imposed quickly ; however, it 
was temporary in nature. The measure had been extended on 2  July 2018, for a period of 
three  months , on certain varieties  of pulses . No additional quota had been provided during the 
extension  period. As requested by Australia, India would provide pertinent in formation in the CoA, 
and would also revert to the Council  with it s justification of the measure.  
22.20.   The Chairperson  proposed that the Council take note of the statements made . 
22.21.   The Council so agreed . 
23  CHINA – CUSTOMS DUTIES ON C ERTAIN INTEGRATED CI RCUITS – REQUEST FROM THE 
EUROPEAN UNION AND J APAN  
23.1.   The Chairperson  informed the Council that , in communications dated 21  June 2018, the 
delegations of the European Union and Japan, respectively, had requested the Secretariat to include 
this issue on the agenda.  
23.2.   The delegate of Japan  thanked China for the detailed explanation of its classification of 
Insulated Gate Bipolar Transistors (IGBT), and for having provided the relevant documents during 
the bilateral consultations. However, Japan still had a number of  conce rns and asked China to explain 
the HS transposition methodology it had used, based on document WT/L/995, and its reason , in 
particular,  for China having chosen the fourth  methodology, or the arithmetic average of the 
previous rates of duty , but not the oth er three  methodologies recommended in the document. Japan 
also asked China to clarify its classification of IGBT -Intelligent Power Module s (IGBT -IPM) given that , 
in accordance with the WCO 's classification opinions, these should have been  classified as pow er 
module s under tariff line HS854239 . However, China treated the IGBT -IPM differently , classifying it 
as IGBT-IPM, under HS854044 , and imposing on it a 5% customs duty rate.  
23.3.   The delegate of the European Union  recalled that this issue had been on the agenda of the 
Goods Council , and other WTO  Committees , for a very long  time. Nevertheless, she thanked China 
for its engagement on this issue, both bilaterally and in other contexts, such as the GAMS . 
23.4.   Following exchanges on this matter at the CTG, the ITA,  and the M A Committees, China had 
finally provided its calculation method for the transposition of tariffs on MCOs , towards tariff 
heading  8542, under HS2017, for which the EU was grateful. Although the method that China had 
used was now clearer to the EU,  a number of questions that had been raised at the last CTG  meeting 
remained open. For example, why did China not make an ex -out for those lines that it had already 
applied at zero? When implementing reclassification under HS2017, China had calculated 
two different averages: one of 3.4%, obtained by averaging the previous duty rates of the 
17 MCO lines; and the other of 3.2%, averaging the previous duty rates of only 16 of the 17  product 
lines (Isolated Gate Bi -Polar Transistors (IGBT)  modules were excluded ). China allocated the 3.2% 
average to one  single subheading , and the 3.4% to three  different subheadings. This led to the 
following outstanding questions: Why had China applied two separate averages to MCOs? Could 
China explain the criteria  that it had used to allocate the 3.2% and 3.4% to the different products? 
In addition, one specific line – IBGT tariff line HS  8504.40.91 – had been treated differently. 
Assuming that IGBT had been  considered as an MCO, could China explain why neither the 3.4% nor 
the 3.2% average duty rate had been applied, but why a duty rate of 5% had been applied instead?  
23.5.   The delegate of the United States  echoed Members'  previous statements , and reiterated 
US concerns over a change in China 's applied duty rates for semiconductor products, an issue 
previously raised by her delegation in this Council , the ITA  Committee , and the CMA.  G/C/M/132  
 
- 38 - 
 
  23.6.   The delegate of Switzerland  registered Switzerland's ongoing concern over this issue . 
23.7.   In its ITA II schedule in HS2007, China had made a clear commitmen t to bind duties at zero 
for all electronic integrated circuits classified under HS  heading  8542. Switzerland therefore invited 
China to preserve the compatibility of its methodology with the WTO 's rules, and to provide additional 
explanation s in this regard. 
23.8.   The delegate of the Republic of Korea  shared the concerns  of other Members . Korea believed 
that HS  transposition was inevitable when ever new HS  nomenclature was introduced ; however, this 
process should fully respect the spirit and principle of the ITA by maintaining the existing balance of 
commitment s among Members. It was regrettable that China had not yet provided sufficient  
information on this issue. Korea hoped that China would soon clarify all of the concerns that had 
been raised by Members.  
23.9.   The delegate of Chinese Taipei  indicated that her delegation continued to be concerned over  
this issue , which had been repeatedly raised at the ITA and MA  Committees. Chinese Taipei 
continued to question if China 's measure was in conformity with WTO  rules and China 's commitment 
under the Agreement on ITA  Expansion. She asked China to provide justification for its measure , 
and also to provide the necessary recent import data for the MCO  products at issue . She urged China 
immediately to remove the tariff rate s applied to imports of the MCO products at issue.  
23.10.   The delegate of Singapore  again registered its interest in this issue.  
23.11.   The delegate of China  said that his delegation had taken note of Members'  concerns and 
questions. China had responded on this issue at  previous meetings of the CMA, the ITA , and this 
Council, and had also conducted bilateral consultations with several Members in order to respond to 
and clarify their technical questions.  
23.12.   He reiterated that China was a major trading partner in IT products,  that it had fully 
participated in the ITA  Expansion negotiations , and that it had been seriously implementing its 
commitments. In accordance with the results of the ITA  Expansion negotiation, MCO  products 
covered 17  ex-out tariff lines in China 's tariff n omenclature of 2007. These ex -out tariff lines had 
been changed to five  national tariff lines in the HS  2017 transposition, in accordance with the WCO 
HS amendment. As such, specific parts of several subheadings had been regrouped in to new 
subheadings.  
23.13.   Given that it had been  impractical to establish reasonably accurate trade allocations  and, 
pursuant to document  WT/L/995, China had adopted to use the fourth method ology , which consisted 
in the application of the simple average of previous rates of duty. Such a methodology was fully 
consistent with WTO  rules on HS2017  transposition. Technically, it was unavoidable to increase duty 
rates on some products using the simple average method, while duty rates on other products were 
reduced. In this case, even the duty rates on 10  MCO products were relatively higher compared to 
those in HS2012, and the duty rates on 7  MCO products had been substantially  reduced . 
23.14.   China had undertaken seriously , and would continue to fulfil , as scheduled,  its tariff reduction 
commitme nts undertaken in the ITA expansion. In this context, the linear reduction of duties on 
MCO products would be implemented through a five-year period. According to China 's tariff reduction 
commitments undertaken in the ITA expansion, all duties on the MCO  products would be eliminated 
by July  2021.  
23.15.   The questions raised  by Members would be conveyed to Capital , and clarifications w ould be 
provided in due course.  
23.16.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
23.17.   The Council so agreed . G/C/M/132  
 
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  24  CHINA – NEW EXPORT CONTROL LAW IN DRAFT – REQUEST FROM THE EU ROPEAN 
UNION AND JAPAN  
24.1.   The Chairperson  informed Members that, in a communication dated 21  June 2018, the 
delegations of the European Union and Japan , respectively, had requested the Secretariat to include 
this issue on the agenda.  
24.2.   The delegate of Japan  referred again to China 's draft new Export Control Law , released by the 
Chinese Government in June  2017. The draft law, currently being considered by the National 
Congress, raised several concerns , including that it could establish a wider scope of covered products 
subject to restriction, including the protection of important strategic raw materials, that the 
requirement for disclosure of technological information at export could be more stringent than 
necessary, and that the draft law also provided for response  measures that could be taken against 
discriminatory export control measures introduced by other countries. Such measures would not be 
consistent  with international export control regimes.  
24.3.   At the CTG's meeting  of March  2018, China had indicated that it would comply with the ruling 
in the DS  case concerning  rare materials, including rare earth s, and that it would also abide by 
international regimes in terms of requirements for disclosure of technological information. Japan 
welcomed these explanations. Nevertheless , Japan asked China to clarify the scope of the products 
subject to control, the types of documents required for export permission, and whe n and how the 
relevant authority would implement the se requirements.  
24.4.   With regard to  response measures, Japan believed that these should be eliminated as they 
could be considered to be unilateral measures not subject to national security. Japan therefore 
requested the Chinese authorities to take into account its concerns with regard to this draft law , and 
to provide an update on how China would reflect the public comments , and the comments made at 
this Council , in its draft law. Japan asked China to confirm that the draft law would be reviewed 
before being submitted to Parliament, and encouraged China to submit its implementation schedule  
in a transparent manner , including its detailed enforcement declarations. Japan also urged China to 
ensure a sufficient tr ansition period for the law 's implementation.  
24.5.   The delegate of the European Union  noted that the EU had submitted its comments to China  
in July  2017, during the consultation period . The EU welcomed China 's efforts to consolidate various 
existing export control provisions into a single draft export control law. The EU attached great 
importance to the convergence of export controls globally for preserving international security and 
ensuring a level playing f ield, and acknowledged that the draft law could consolidate and strengthen 
China 's export control system, its strategic export controls derived from international obligations 
and commitments, and related objectives in terms of international security and no n-proliferation of 
weapons of mass destruction. Against this background, the draft law nevertheless contained certain 
provisions that required further clarification in terms of their alignment with international security 
standards , and their conformity wit h the WTO's multilateral trade rules.  
24.6.   The EU sought China 's explanation of the reference to the "development interests of the 
State", which was mentioned in Article  1 of the draft law as being an objective of Chinese export 
controls , and a basis for export  control decisions and, in particular, of its compatibility with 
international law and China 's WTO commitments. The same concerns applied to a number of other 
references, found throughout the draft Law, to economic development and industrial 
competitivenes s factors that should be taken into account when developing the list of controlled 
goods. Considering that strategic export controls reflected international security considerations and 
were not conceived as trade defence instruments, the EU would appreciat e receiving further 
information from China about the reference to their use as retaliatory measures against 
"discriminatory export control measures", including whether such a  principle were compatible with 
China 's WTO commitments and international law . 
24.7.   The EU noted that the scope of the draft law included military and dual -use items, but also 
potentially other items , and asked if the scope of controlled goods might be set too broadly, 
especially in light of the reference, in the draft explanation, to the  "protection of important strategic 
rare materials". The EU was concerned about such scope , and also that unnecessarily excessive 
technology disclosure might be required as part of the licence  application process set out in Article  33 G/C/M/132  
 
- 40 - 
 
  of the draft, and hop ed that the written comments that the EU had provided would be taken into 
consideration when developing this particular aspect of the draft legislation.  
24.8.   At the CTG 's previous meeting , China had explained that it had introduced changes to the 
draft based on  the stakeholder input that had been received in 2017. The EU had been among those 
that had submitted their comments, raising some of the above -mentioned issues, and would 
appreciate to receive further information from China in this regard and , in particul ar, concerning any 
changes that may have been introduced , and what China 's timeline was for finalizing this draft law. 
The EU looked forward to further discussion s with China with a view to achieving a mutually beneficial 
convergence of export controls in line with international rules and standards.  
24.9.   The delegate of the Republic of Korea  indicated that his country had systemic concerns over 
the potential impact of China's draft law. When introducing the law, China should ensure its 
consistency with relevant international law, including WTO  rules.  
24.10.   The delegate of China  said that his delegation had taken note of the statements made , and 
of the systemic or specific concerns and questions that had been raised. As already explained at the 
CTG's previous  meeting, t he draft Export Control Law had been  published on the internet , for public 
comment , in June  2017. Based on the comments received from the general public and the relevant 
authorities, China's Ministry of Commerce had introduced further modification s and imp rovements  
into the draft law . In February  2018, the draft had been submitted to the State Council, while the 
Ministry of Justice had conducted its  legislative review of the  draft.  
24.11.   For China,  it was clear that opening  up its nation to the world was a fundam ental national 
policy. This open policy would not change because  China attached great importance to creating a 
non-discriminatory and transparent business environment, and to adhering to WTO  principles, 
including national treatment, while treating all mark et entities , including foreign companies , in a fair 
and equitable manner. The purpose of this draft Export Control Law was to safeguard the rights and 
interests of all parties; therefore, it did not discriminate against foreign companies. As a matter of 
fact, in the legislative development  of this Export Control Law, China had followed an open and 
democratic process, drawing on international experience and best practice. Therefore, China had 
welcomed suggestions on how to improve this legislation , which would be submitted to the relevant 
Chinese legislative authorities in the follow -up to the legislative process.  
24.12.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
24.13.   The Council s o agreed . 
25  THE RUSSIAN FEDERATI ON – TRADE RESTRICTING P RACTICES – REQUEST FROM THE 
EUROPEAN UNION  
25.1.   The Chairperson  inform ed the Council that, in a communication dated 21  June 2018, the 
delegation of the European Union had requested the Secretariat to include  this issue on the agenda.  
25.2.   The delegate of the European Union  said that the EU had no other option but to raise most of 
the same issues that it had raised already at the CTG's previous meeting, since there had been little 
change since that time . 
25.3.   The cement  certification requirement, introduced in March  2016, had continued to block 
EU exports to Russia; importing companies still faced difficulties in obtaining certificates; and 
systematic border controls amounted to clear discrimination. This issue had been raised at least 
six times by the EU in both the TBT  Committee and the CTG. Indeed, the discriminatory nature of 
the Technical Regulation currently in place (GOST  standard on cement certification , or 
GOST  R 56836 -2016) had been recognized by the Russian Fed eral Anti -Monopoly Service , in 
August  2017; however, the technical regulation had still not been adjusted. EU cement  exports  (with 
the except ion of  white cement , which was  required by Russian industry ) had been blocked since the 
introduction of the requirement. The EU had requested Russia to correct this discriminatory 
dimension and, in doing so, to respect all of the WTO's rules, including  in terms of notification to 
other WTO  Members, and especially given that the current measure had not been properly notified. 
The EU also called upon Russia and the other four  members of the Eurasian Economic Union  (EAEU) G/C/M/132  
 
- 41 - 
 
  not to replicate the discriminatory character of this measure in the technical regulation that was 
currently  under preparation at EAEU  level.  
25.4.   The requirement of "good manufacturing practice" (GMP) certificates for pharmaceuticals, 
which had still not yet been notified to the WTO, also remained an important obstacle to imports 
into the Russian Federation of pharm aceutical products. The procedure to obtain GMP  certificates 
was more complicated for importing companies than for domestic producers because  there were too 
few inspectors. Moreover, obtaining GMP  certificates was necessary before a request could be made 
for a marketing authorization, and this  was not the case for domestic producers. Since the Duma 
had approved amendments to Federal Law No. 61, the EU requested the Russian Federation to 
update Members on its schedule for the entry into force of such amendme nts, and also to ensure 
that there would be a smooth transition period for the industry and stakeholders concerned . 
25.5.   Concerns still remained over the Russian Federation's embargo on fishery products from 
Estonia and Latvia that had been in place since June  2015, allegedly for SPS reasons. The EU had 
raised this specific trade concern in the SPS  Committee on several occasions, but without having 
ever obtained a proper explanation and reply from the Russian Federation.  
25.6.   The Russian Federation's wine  taxation re gime, as modified in 2017 , had also not evolved 
positively. Indeed , in mid -2017, Russia had passed a law establishing an excise duty taxation regime 
that was heavier on imported than on domestic wines ; only GI wines could benefit from lower 
taxation rates , but only domestic Russian wines would  qualify as GI  wines.  
25.7.   An additional concern was the increasing difficulty that importing companies (for goods) , and 
foreign companies (for services) , faced in terms of participation in Russian SOEs ' purchases. A series  
of measures had been introduced since 2015 , to restrict the access of importing and foreign 
companies to these purchases, with the most recent dating to December  2017, which had introduced 
a further control of purchases of aeroplanes and ships. The EU and  other WTO  Members had raised 
these measures several times at the TRIMs Committee. The EU urged Russia to reply to the EU 's 
questions on this matter.  
25.8.   Last but not least, another issue of concern was the regime to be applied to the automotive 
sector as of 1  July 2018. When joining the WTO in 2012, Russia had been allowed to maintain several 
WTO-incompatible measures. Those measures had allowed the Russian Federation to import car 
parts free of duty on condition of local content requirements, an exemption tha t was due to end by 
30 June 2018. The EU urged Russia to inform WTO  Members , firstly,  of its decision effectively to put 
an end to the current WTO -incompatible regime and, secondly, to give information on the measures 
planned for the post -30 June period, i ncluding adjustment to the EAEU  customs codes. The EU was 
of the view that the whole regime needed to be removed because  selective amendments would not 
be sufficient to make  it WTO -compatible.  
25.9.   The delegate of the United States  echoed the EU 's concerns  and reminded delegations that 
the US had itself raised similar concerns , and on the same range of issues , at previous meetings of 
the CTG; however, those concerns had remained unaddressed. The US would continue to monitor 
this situation , and requested the Russian Federation to address the concerns that had been raised 
on these issues.  
25.10.   The delegate of the Russian Federation  indicated that the practice of the GOST -R (56836 -
2016) application had shown the necessity for changes and, in order to i mplement those changes, 
draft amendments to the GOST -R had recently been developed and published on the website of the 
Federal Agency for Technical Regulation and Metrology. Public consultations on the draft had ended 
on 1 March  2018, and the final text wa s being finalized , taking into consideration all of the comments 
that had been received during the public consultation process. The draft provided, inter alia , for 
elimination of additional inspection control s. Russia expected that this draft would be adop ted by 
end-summer  2018. 
25.11.   On GMP  certification, she assured interested Members that the GMP  certification system was 
fully compatible with international standards and recommendations in this area. The State Institute 
of Pharmaceutical Products and Good Pract ice was the body authorized to conduct GMP  inspections . 
She noted that , during the period 1  January  2016 to 30  October  2017, the Institute had conducted 
738 inspections for compliance with GMP  rules, including 626 inspections of foreign manufacturers, G/C/M/132  
 
- 42 - 
 
  and 112 of domestic manufacturers . The number of inspections of foreign manufacturers in 2016 
had been  188, and 438 during the first  ten months of 2017. Statistics therefore demonstrated that 
the number of inspections of foreign manufacturers was almost six  times t he number of inspections 
of domestic manufacturers . 
25.12.   In addition, the number of foreign manufacturers ' inspections in 2017 had increased and 
stood 2.5 times higher compared to 2016.  
25.13.   The schedule for GMP  inspections was published on the website of the M inistry of Industry 
and Trade, and as from February to August  2018 it had included more than 300  inspections.  
25.14.   On the step -by-step registration procedures raised by the EU, she indicated that such 
procedures had been streamlined. The draft amendments to the  Federal Law on the circulation of 
medicines had been  adopted by Federal Law No.  140-FZ, which had entered into force on 
15 June 2018. To initiate the medicine registration process , the amendments allowed for the 
provision of either a copy of the GMP certificate , or else a copy of the decision of the Ministry of 
Industry and Trade.  
25.15.   In addition, the amendments allow for a GMP  certificate not to be provided, and for repeat 
inspection in the case of changes in the quality of the medicine , and/or its m ethods of control. The se 
changes had been designed to simplify and accelerate the registration of new medicines on the 
Russian market.  
25.16.   Turning to the regime for fish imports from Estonia and Latvia, she indicated that good 
progress had recently  been made . On 15 December  2017, following inspections carried out in 2016, 
Russia 's veterinary service lifted its restrictions on one Estonian and one  Latvian establishment. 
Results of the above -mentioned inspections would be sent to the EU  competent authorities in d ue 
course.  
25.17.   On state -owned enterprises and industrial assembly issues, the Russian delegation had 
already provided WTO  Members with the necessary clarifications at the TRIMs  Committee meeting 
of1 June 2018. She referred interested Members to Russia 's interv entions at that meeting.  
25.18.   With regard to wine taxation , the Russian Government was aware of EU  concerns , and 
continued its elaboration of a transparent and sustainable way to develop the use of geographical 
indications protection by national producers of high-quality  wine.  
25.19.   The Russian delegation stood  ready to discuss with interested Members and to address all 
of the issues that had been raised.  
25.20.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
25.21.   The Council so agreed . 
26  UNITED STATES – PROHIBITIVE PROPOSA L ON COMMUNICATION E QUIPMENT OR 
SERVICES RELEASED BY  THE FCC – REQUEST FROM CHINA  
26.1.   The Chairperson  informed Members that, in a communication dated 21  June 2018, the 
delegation of China had requested the Secretariat to include this issue on the agenda.  
26.2.   The delegate of China  observed  that China had noticed , in May 2018, that the US  Federal 
Commun ications Commission (FCC) had issued an announcement on the Federal Register that 
intended to prohibit the use of the Universal Service Fund to purchase equipment or services from 
any communications equipment or service providers identified as posing a nat ional security risk to 
the communications networks or the communications supply chain.  
26.3.   The FCC  proposal would restrict the commercial purchases of telephone, broadband service s, 
and healthcare providers. China called upon the United States to adhere to WTO  rules during the 
proposal's legislation process, especially by ensuring the transparency of the measure and its 
compliance with the MFN  principle. China also noted that the  proposal would violate the G/C/M/132  
 
- 43 - 
 
  MFN principle if the measures provided a nationality -based discriminatory treatment in law or in 
practice.  
26.4.   China also noted that the US had recently launched a series of so -called National Security 
measures, including Section  232 measures on imported steel and aluminium. China was seriously 
concerned over this  policy trend  and was opposed to protectionism under the guise of National 
Security.  
26.5.   During the 2016  G20 Summit, the Chinese and US  leaders had reached consensus on and 
committed to the following declaration, quoted in relevant part: " … consistent with 
WTO agreements, [to] commit that their respective generally -applicable information and 
communication technology (ICT)  security -related measures in commercial sector (1)  should treat 
technology in a non -discriminatory manner, (2)  are not to unnecessarily limit or prevent commercial 
sales opportunities for foreign suppliers of ICT  products or services, and (3)  should be narrowly 
tailored, taking into account international norms, and be non -discriminatory, and not imposing 
nationality -based con ditions or restrictions, on the purchases, sales, or use of ICT  products by 
commercial enterprises unnecessarily".  
26.6.   China therefore urged the US to honour this commitment, and to ensure the compliance of 
its FCC measures with WTO  rules.  
26.7.   The delegate of the United States  noted  that the proposed rule raised by China,  issued by the 
US Federal Communications Commission (FCC) , dealt exclusively with matters of national security. 
In particular, the proposed rule was intended to  ensure that universal service funds were not spent 
on telecommunications equipment or services from suppliers that posed a national security threat 
to the integrity of communications networks or the communications supply chain. Such a rule would 
fall squarely within the WTO  exception for ess ential security interests. Indeed, this Council would 
not expect any Member to procure goods or services the use of which it determined would pose a 
national security threat.  
26.8.   The proposed rule -making had been conducted through a transparent and open proces s. The 
FCC had released a lengthy description of the proposed rule on its website , including an extensive 
discussion of its rationale , and had welcomed comments from the public up until the close of the 
comment period just a few days before . 
26.9.   Since the FCC was an independent regulator , she referred interested Members to  the fcc.gov 
website, where further updates on this matter would be posted as they became available.  
26.10.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
26.11.   The Council so agreed . 
27  IMPORT LEVY BY WTO M EMBERS OF THE AFRICA N UNION – REQUEST FROM THE 
UNITED STATES  
27.1.   The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of the United States had requested the Secretariat to again include this issue on the 
agenda.  
27.2.   The delegate of the United States  said that the US considered it necessary to continue raising 
its concerns over the trade -related aspects of the African Union 's (AU) Decision, unanimously 
adopted by Heads of State in July  2016 in Kigali, for AU  members to finance 100% of the AU 's 
operational budget, 75% of its program me budget, and 25% of the AU  Peace Fund by 2 020. The US 
had repeatedly expressed its support for the AU 's self -financing initiative, including efforts to fund 
25% of the AU  Peace Fund. However, it did not support the use of trade measures to fund the 
Decision. And it  seemed that, in order to generat e funds to implement the Kigali Decision, some 
AU members were already implementing new country -specific import levies, while others were 
contemplating doing so. In all likelihood, these  levies contravened the AU's WTO  obligations.  G/C/M/132  
 
- 44 - 
 
  27.3.   As stated at the CTG  meeting of March  2018, the US had understood that the following 
countries, at a minimum, were already collecting a 0.2% levy on imports onto the Continent: 
Cameroon, Chad, Côte d'Ivoire, Djibouti, Ethiopia, Gabon, the Gambia, Guinea, Kenya, Morocco, the 
Democ ratic Republic of the Congo, Rwanda, Sierra Leone, and Sudan. Additionally, as of earlier this 
year, at least , Benin, Ghana, Malawi, and Senegal had initiated internal legal and administrative 
processes to allow for the implementation of such a levy.  
27.4.   The more than 40  AU members that also belonged to the WTO, and the nine that were in the 
process  of accession , needed to apply any funding mechanism, including an import levy, in a 
transparent manner and in line with their WTO  commitments. The lack of transpar ency over the 
actions that  these countries were taking in this area was a cause for  concern. Was each country 
applying the levy to all goods, or were there exclusions? Was it correct that intra -African trade was 
excluded from the levy? Were exporters from African FTA  partners, including, for instance, the 
European Union, excluded from the levy? Were exporters from countries with significant new 
investments on the continent, like China, excluded from the levy? Where were levy -generated funds 
directed  – to the Peace Fund or to the African Union operational and program me budgets?  
27.5.   The United States  had repeatedly requested transparency from AU  members in this Council 
but to date  had received none , and this despite the fact that some countries had for months been 
applying non -transparent levies against US  exports and, presumably, against the exports of others 
outside of Africa, too . When would AU WTO Members applying a levy provide details of it to this 
Council? The US would continue to raise this issue, as approp riate, at multiple venues , including at 
the General Council, at country TPRs, and in WTO accession negotiations , until it was assured that 
AU members were abiding by their WTO  obligations. The US also encouraged any AU member  
country applying the levy to b egin by providing to all WTO  Members a basic level of transparency , 
and to do so as soon as possible . The US would welcome and encourage discussion s between Capitals 
on non -trade measures that could be used to accomplish the same policy objectives.  
27.6.   The del egate of the European Union  recalled that on previous occasions her delegation had 
strongly supported the purpose and cause of the 0.2  % levy, intended to enable  the AU to finance 
its activities in support of African countries. However, AU  Members should provide more information 
about this process, and on the measures that they had already adopted or envisaged adopt ing. The 
EU attached utmost importance to transparency and had encouraged AU  WTO Members to notify the 
measures in question, whi ch should be WTO -compatible.  
27.7.   The delegate of Canada  reiterated Canada 's support for AU efforts to increase African resource 
mobilization to fund the AU 's operations and programmes, and to Africa 's regional integration and 
free trade efforts  in general . In this regard, Canada also w elcomed the signature of the AU  Free 
Trade Area . At the same time, Canada encouraged AU  members to engage in  discussions with other 
WTO Members to ensure that any current or future funding mechanism or implemented levy would 
be transparent and WTO  consistent.  
27.8.   The delegate of Japan  also supported the objective s of the AU 's peace support operation. 
However, the implementation status of its Decision on the 0.2%  levy was not clear , and generated 
concern over its WTO consistency. Japan requested the AU 's WTO  Members to provide detailed 
information on its status.  
27.9.   The delegate of South Africa,  on behalf of the African Group, indicated that South Africa  had 
taken note of the statements made and questions posed regarding the AU 's import levy. The 
message would be duly conveyed to the African Union . 
27.10.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
27.11.   The Council so agreed . 
28  UNITED STATES – MEASURES ON AVIATIO N SECURITY EQUIPMENT – REQUEST FROM 
CHINA  
28.1.   The Chairperson  informed the Council that, in a communication dated 21  June 2018, the 
delegation of China had requested the Secretariat to include this issue on the agenda.  G/C/M/132  
 
- 45 - 
 
  28.2.   The delegate of China  said that the US  Transportation Security Administration (TSA) was the 
US authority responsible for certifying civil aviation security equipment (TSA  certification) and for 
obtaining airport security equipment. One of the conditions on the procurement of c ertain security 
equipment was to obtain TSA  certification. However, in the case of applications for TSA  certification 
submitted by Chinese enterprises  but refused by the US  authority , the US  authority had not 
explain ed the specific reasons  for its refusal , nor respond ed to any further enquiries ; instead, it had  
simply  informed applicants by e -mail that their applications  had not been accepted . 
28.3.   Consequently , Chinese exports of aviation security equipment to the US and other countries 
with which there existed  transportation cooperation with the US were blocked. Furthermore, as 
TSA certification was to be adopted by more countries  in future , manufacturers of  Chinese aviation 
security equipment were facing difficulties in exporting to the global market.  
28.4.   China be lieved that the US TSA certification was inconsistent with the TBT  Agreement on the 
grounds that  it was inconsistent with the conformity assessment procedures of central government 
agencies. In addition , the TSA  certification body communicated  only by e-mail, and no longer 
accept ed certification applications, including for aviation security equipment from Chinese 
companies. The TSA had also failed to respond to China 's further enquiries. The TSA  certification 
also lacked transparency given that  it had never  been notified to the TBT  Committee. In short, the  
TSA certification was inconsistent with the principle s of the TBT  Agreement , which required Members 
not to impose unnecessary obstacles to trade.  
28.5.   The United States  had stated that TSA  certification was clo sely related to TSA  procurement 
and should be seen as a part of government procurement ; however,  China believed that 
TSA certification and TSA  procurement constituted two  different practices. As TSA  certification had 
a significant influence on markets outs ide the US, many applications for TSA  certification were not 
applications for TSA procurement. Therefore, TSA  certification was independent from 
TSA procurement and should not be treated as a government procurement exception.  
28.6.   China called upon the United States to follow and abide by the relevant provisions and 
principles of the TBT  Agreement and to treat Chinese companies and products in an equal manner, 
including by providing national and MFN  treatment, and by eliminating  these technical barriers to 
trade.  
28.7.   In addition to US explanation s provided in bilateral consultations , and at previous 
TBT meetings,  China looked forward to receiving further information from the US  on these issues . 
28.8.   The delegate of the United States  said that the aviation security  measures raised by China at 
this meeting , and at the previous TBT  Committee meeting , dealt with national security matters , and 
airplane security, in particular. China 's concerns should therefore  be addressed to the 
US Transportation Security Administratio n, the competent authority on these issues. Being security -
specific, the issue  should not be addressed at this Council.  
28.9.   The delegate of China  expressed China 's disagreement with the US  view that this was a 
national security issue. The US was not the only Member  to face security issues – China faced  them 
too, although  did not , on these grounds,  prevent certification or procurement of US  aviation security. 
Furthermore, Chinese aviation security equipment was present worldwide, including in the European 
Union. Chinese aviation security equipment met all of the most stringent safety technical standards 
and requirements and had been recognize d on the EU and other global markets  on that basis . 
Therefore, China believed that the security issue should not be used as an excuse to restrict normal 
bilateral trade  relations in this area . 
28.10.   The Chairperson  thanked delegations for their interventions and  proposed that the Council 
take note of the statements made.  
28.11.   The Council so agreed . 
29  WORK PROGRAMME ON EL ECTRONIC COMMERCE  
29.1.   The Chairperson  recalled that , in the Ministerial Decision adopted at MC11 in Buenos Aires , 
Ministers had agreed to maintain the exist ing Work Programme on E -Commerce (Work Programme G/C/M/132  
 
- 46 - 
 
  or WPEC), and to endeavour to reinvigorate the WTO 's work on E -Commerce. The Ministerial 
Decision had also instructed the General Council to hold periodic reviews in its sessions of July and 
December  2018 an d 2019 , based on the reports submitted by the relevant bodies, among them the 
Goods Council; and to maintain the current practice of not imposing customs duties on electronic 
transmissions. Since the CTG had again been tasked to discuss the E -Commerce aspe cts relating to 
trade in goods, in order to fulfil this mandate, the E -Commerce issue was a standalone agenda item. 
He therefore invited delegations to continue to express their opinions and to make suggestions as 
to how to work on the preparation of the p eriodic review to be held in the General Council at its 
session of July  2018. In order to fulfil this mandate, it was also his intention to submit to the General 
Council a factual report under his own responsibility. He informed delegations that he would a lso 
report to the Council on the informal consultations that he had held on a possible workshop on "Cross 
Border E -Commerce and Trade in Goods".  
29.2.   The delegate of China  briefed delegation s about the Workshop on E -Commerce for 
Development under the Multilater al Trading System that had taken  place in China from 8  to 
21 May 2018, and which had been  sponsored by the Chinese Government . Twenty -five participants, 
including Vice -Ministers and DGs from Capitals , as well as Ambassadors and senior diplomats from 
Geneva Missions of 15  developing Members , had attended the event.  
29.3.   Over the two-week workshop, seven  thematic discussions and 11  field trips had been  
organized in Beijing, Shanghai, and Hangzhou. The partic ipants had interacted with relevant 
stakeholders in China 's E-Commerce ecosystem, including government departments, E -Commerce 
platforms, logistics companies , and e -payment service providers. A snapshot -type although 
comprehensive review of E -Commerce deve lopment s in China had enabled participants to develop 
a clearer understanding of E -Commerce as a development enabler. Specifically, at government level, 
seminars had been  arranged on the drafting of E -Commerce Law, Customs ' experiences in Cross -
border E -Commerce (or CBEC) regulation and facilitation, and the overall development of 
E-Commerce in China. The speakers from the Standing Committee of the National People 's Congress 
(NPC), General Administration of Customs and Ministry of Commerce , had shared the l egislative 
institutional design and regulatory concept as well as innovative practices to enable E -Commerce to 
promote development in China. Visits had also been  made to the  Shanghai Pilot Free Trade Zone 
and Hangzhou Comprehensive Pilot Zone for CBEC, whe re the "single  window" CBEC  approach to 
trade facilitation and streamlined import and export procedures were demonstrated.  
29.4.   At the business level, visits had taken  place to E -Commerce platform companies of various 
scale, including Alibaba, Netease, JD.com, and Jolly Information Technology. By exploring their 
operational model s and business development, participants had gained further understanding of how 
Chinese companies integrate d into Global Value Chains through Cross -border E -Commerce (CBEC) , 
and how the large platforms had been  helping MSMEs, women , and young entrepreneurs to sell and 
buy globally and benefit from inclusive trade. Alipay and WeChat Pay had elaborated on their 
e-payment services and had also given  a demo nstration  in supermarkets of how to  use payment 
apps for daily consumption. YTO and JD had arranged tours to their logistics facilities and command 
centres , while sharing their business philosophy and development prospects. Participants had also 
visited the Infrastructure Company Huawei, le arning about the latest communication technologies  
and their development orientation, as well as about how Huawei was helping African countries in the 
construction  of their telecommunications infrastructures . A clearer picture had also been presented 
of the important supporting role played by business in E-Commerce development.  
29.5.   At the level of International Organizations, WCO  Deputy Secretary General Chapa had 
introduced the WCO 's work on promoting CBEC, and an expert from the ITC had shared the latest 
research and reaffirmed the inevitable links between E -Commerce and development. Visits had also 
been made to the Operation Centre  of the Asia-Pacific Model E -port Network (APMEN), which had 
displayed how APEC  promote d the interconnection of e -ports in the region and thereby improve d 
the level of trade facilitation. The valuable practices of these international organizations had provided  
valuable input for the Workshop discussions.  
29.6.   He indicated that China's  position remained consistent in terms of valuing and supporting 
multilateral discussions on E -Commerce  that were centred  upon development. China had reiterated 
in the CTG and other relevant WTO  bodies that E -Commerce had the potential  not only to help the 
WTO to remain  relevant by responding to business needs, but also to assist MSMEs, women , and 
young people in developing Members to participate in international trade and board the high -speed 
train of economic development.  G/C/M/132  
 
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  29.7.   In order to share the insights of the Workshop with the broader Membership , the Friends of 
E-Commerce for Development (FED) had held a seminar in Geneva on 28  June 2018. Three  experts 
from Alibaba, Huawei , and YTO had been invited to make presentations on platforms enabling SMEs, 
E-Commerce infrastruct ure, and E -Commerce logistics, and many Workshop participants had also 
shared their thoughts in this regard.  
29.8.   As a developing country and a member of the FEDs, China indicated that it would continue to 
contribute to capacity building , within its capabilitie s, and to share its national experiences with 
other WTO  developing Members. With 30  million people yet to be lifted from poverty, China faced a 
huge development divide between its urban and rural regions , and between east and west ; therefore , 
development remained at the  top of China 's agenda. However, China had not wait ed until everything 
had been ready before embracing the opportunities provided by E -Commerce and, since 1998, had 
witnessed the transformation of E -Commerce from a little-known  concept to a way of life in China 
today. China would be  happy to continue to share with fellow Members insights into how it had 
benefited and what it had learned in the course of its  development of E -Commerce.  
29.9.   During the course of the Workshop and the foll ow-up seminar, many participants had also 
shared information concerning the status of E -Commerce development in the context of their own 
economies, and their success stories and constraints, which had thereby made the discussion a fully 
interactive exercis e that had contributed  to exploring, under the MTS , how best to improve and 
benefit from E -Commerce to promote development, while bearing in mind China 's specific conditions. 
China was looking  forward to more of such in -depth information -sharing opportunit ies and was 
likewise hoping  to see more Members seize the development opportunities presented by 
E-Commerce with a view to achieving the objective of inclusive development.  
29.10.   China considered it worthwhile to maintain and reinforce the momentum of multilateral 
discussion on trade -related aspects of E -Commerce in this and other relevant WTO  bodies. 
Regarding the CTG , he asked the following  questions.  What could be done to improve the efficiency 
of internet -enabled cross-border trade in goods? What we re Members ' best practices to further 
facilitate cross -border E -Commerce? China welcomed constructive input from Members  in order for 
Members to deepen their common understanding of these issues from various perspectives.  
29.11.   The representative of Pakistan  thanked China for the opportunity provided to Pakistan to 
benefit from the two -week workshop  referenced above ; this had been an enriching experience that 
had allowed the participants to witness first -hand how E -Commerce and development had truly come 
together  in the wake of Chinese efforts.  
29.12.   As coordinator of the FEDs, Pakistan had considered that this enabling feature of 
E-Commerce for Development had been striking. One lesson learned among many , was that 
E-Commerce thrived when all segments of the economy came together to make it effective ; in 
particular, this meant the coming together  not only of the enabling services of E -Commerce, such 
as financial payment systems, but also the logistics, technology, the communication networks, and 
first and foremost, the p roduction channels for cross -border delivery of products through 
E-Commerce. The collective impact of these elements became more pronounced when micro, small, 
and medium -sized enterprises gain ed global connectivity and thereby helped to lift scores of peop le 
out of poverty by creating new jobs.  
29.13.   On the request of many delegations that could not attend the workshop in May, the FED had 
hosted, along with China, a seminar for sharing with Members the various experiences ; this seminar 
was well attended.  
29.14.   The dele gate of Australia  thanked China for its presentation and for its willingness to share 
its experiences under this agenda item. Australia welcomed the discussions in the CTG under the 
1998 Work Programme and would continue to engage with Members on the relevant issues as they 
were raised.  
29.15.   The Chairperson , in the absence of further interventions, and as he had indicated in his 
introductory remarks that he would , then reported to  the Council on the internal consultations that 
he had held in May and June  2018 on a possible workshop on cross -border E -Commerce and Trade 
in Goods. In this regard, he recalled that at the last CTG  meeting, on 23 and 26  March  2018, under 
the agenda item on E -Commerce, it had been  proposed that a "Workshop on Cross -Border G/C/M/132  
 
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  E-Commerc e and Trade in Goods" be organized this year, under the aegis of the CTG. Various 
Members had supported this initiative and, since there had been  no opposition signalled to it, his 
predecessor had indicated that he, as incoming Chair of the CTG, should hol d consultations in this 
regard.  
29.16.   Consequently, in a fax dated 8  May 2018, he had invited delegations, acting in some cases 
also as group coordinators, to an initial consultation meeting to share their preliminary views on this 
proposal , including on certain  elements of the proposed workshop, in particular with regard to 
possible themes and speakers to be included in an initial agenda; and a possible date for the 
workshop and, in particular, whether the workshop should be held back -to-back with the CTG 's 
autumn meeting.  
29.17.   A first round of informal consultations had taken  place on 16  May 2018 and, having heard 
Members ' views on various aspects, he concluded those consultations by noting that there had 
appeared to be general support for such a Workshop, even if  many delegations were clearly of the 
view that it would have been helpful to have first received a draft programme in order  to have 
facilitated discussions on possible themes and speakers.  
29.18.   China, as the Member that  had originally proposed this Workshop, had requested the 
Secretariat 's assistance in elaborating a first version of a draft programme. A draft programme had 
subsequently been elaborated that had attempted to take into account the various points that had 
been raised during the consultations. Thes e had included the fact that the Workshop should be a 
WTO event but nevertheless afford Members an opportunity to get a sense of the work being done 
by other International Organizations, such as the WCO, the UPU, the OECD, UNCTAD, etc.; that it 
should also  afford Members an opportunity to share information, experiences , and practices; that it 
should cover the development component and related aspects ; and that it should also consider the 
implications for MSMEs for both developing and developed Members.  
29.19.   The idea had been to revise the initial draft programme on the basis of comments provided 
by delegations during a second  round of informal consultations. In this vein, the same delegations, 
including again the Group Coordinators, had been  invited to attend a s econd  round of consultations 
on 20  June 2018.  
29.20.   Comments that had been received from Members during the second  round of consultations 
included the following : the workshop should not duplicate other E -Commerce events; the draft 
programme should be streamlined  and reduced to a one -day event; an information session dedicated 
to E-Commerce discussions at the WTO, initially intended  for Capital -based officials from developing 
and LDC  countries, whose participation would be funded by the ITTC, should instead be open to all 
participants , and should also include information on the Joint Statement Initiative on E -Commerce. 
At the same time, concerns were voiced over the process and substance of the workshop. The point 
was made that the purpose of the workshop was unclear, and that the draft programme seemed to 
be based on a flawed premise that goods purchased online should enjoy  a special status at the 
border for customs purposes. Also, an additional concern was that , contrary to what may have  been 
understood, the pr ocess seemed to suggest that Members had already agreed to the idea of a 
workshop , when this was in fact not so . 
29.21.   In light of these  comments, he had considered it prudent not to circulate any draft 
programme for discussion by the Council , but rather to limi t himself only to report ing, at this 
meeting , on the discussions that had taken  place during t hese preliminary consultations.  
29.22.   The delegate of China  thanked the Chairperson for his report and for organizing these rounds 
of consultations for the CTG –E-Commer ce Workshop. China also thanked the Secretariat , for having 
prepared the draft agenda , and Members , for sharing their various comments and perspectives . 
China believed that E -Commerce was essential to achieving the development objectives in the WTO , 
and al so for E-Commerce -enabled  trade in goods to contribute to the participation and integration 
of developing countries into global markets  and the digital age. Therefore, China considered that 
such workshop s were necessary in the context of the CTG, and suggested that a future workshop 
focus on cross -border E -Commerce in Goods, taking into consideration the valuable work undertaken 
not only at the CTG , and in other WTO Committees , but also the work being carried out in such 
international organizations as  the WCO and the ITC, for example.  G/C/M/132  
 
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  29.23.   The delegate of Chinese Taipei  thanked the Chair for his report , and indicated that her 
delegation had already made various  comments on this subject during the informal consultation s. 
Her delegation believed that the inte rnet had changed the landscape for doing business , and that it 
was now necessary to analyse  the fundamental difference s between E -Commerce and traditional 
trade.  
29.24.   The various forms of barriers to traditional trade, like customs duties, non -tariff barriers, or 
others, usually took effect at or just after a border. However, the barriers to digital trade and 
E-Commerce via the internet were very different. They were usually apparent  during the early stage s 
in the transaction, in the areas of price comparison and deciding where to place an order . On process , 
she noted  that the issue had apparently attracted the attention of the broad Membership; therefore , 
informal consultations on this issue, and any other matter concerning the workshop , should advance 
in a sp irit of transparency and be open to all Members.  
29.25.   The delegate of the United States  thanked the Chair for his report and indicated that it might  
be of interest to Members to know that the US was one of the delegations that had expressed 
concerns with regard  to process ; the US likewise had questions regarding the specific objective of 
this proposed workshop.  
29.26.   The US believed that many previous events had effectively covered similar topics and , at 
this point , they were unconvinced that this workshop was in fact  additive. However, if there were to 
be a consensus among Members to organize  a workshop addressing the interests of all Members, 
the US believed that discussion s should begin on the basis of a Member -driven consensus process , 
and that a new programme should be developed in an inclusive and bottom -up manner. If the Chair 
intended to continue holding consultations on such a workshop she would suggest that these be 
carried out in an open -ended format so that all Members could participate and so that the 
development of such a workshop would then indeed be a Member -driven process.  
29.27.   The delegate of the European Union  thanked China for its report on the workshop that had 
taken  place in Beijing , and also for its proposal for a workshop on cross -border E-Commerce and 
trade in goods. As indicated  in earlier consultation s, the EU was willing to work with others to make  
the workshop relevant and interesting , and had put forward various suggestions on how to 
streamline the programme while at the same time broadening the scope of the discussion. The EU 
looked forward to continuing to exchange ideas on the workshop with other Members on the basis 
of a revised draft programme.  
29.28.   The delegate of Japan  indicated that all WTO  Members had agreed in Buenos Aires to 
reinvigorate the work being carried out under the 1998  Work Programme. Thus, Japan supported 
any suggestions that were in line with that decision. On the workshop suggested by China, Japan 
positively evaluated the suggestion , considering it a concrete suggest ion in line with the Work 
Programme of 1998. Once the workshop had been agreed,  the agenda should be formally or 
informally discussed among Members in a transparent manner. Japan was committed to actively 
participating  in that discussion.  
29.29.   The delegate of the Republic of Korea  thanked China for sharing information on the 
E-Commerce Workshop that had been held in Beijing , and thanked the Chair for holding informal 
consultation s on a possible workshop under the WPEC. Korea was generally suppor tive of the idea 
of holding an E-Commerce Workshop , and hoped that the current proposal would be developed in 
line with the Work Programme adopted in MC11. Korea remained engaged to develop the 
CTG Workshop programme with other Members . 
29.30.   The Chairperson  thanked delegations for their interventions and , in light of Members' 
comments, concluded that he should continue to hold consultations , in open -ended mode,  with 
interested delegations on this issue . He also proposed that the Council take note of the statemen ts 
made.  
29.31.   The Council so agreed . 
29.32.   As indicated earlier, and in order to fulfil the Buenos Aires mandate, he also proposed that 
he, under his own responsibility,  would  submit a factual report to the General Council in July  2018, 
based on the discussions held in this Council meeting, and that which had taken  place in April  2018.  G/C/M/132  
 
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  29.33.   The Council so agreed . 
30  OTHER BUSINESS  
30.1  European Union – Amendments to the Directive 2009/28/EC, Renewable Energy 
Directive – Request from Malaysia  
30.1.   The Chairperson  reminded delegations that, at the start of the meeting, the delegation of 
Malaysia had requested to include, under "Other Business" , an issue regarding the Amendments to 
the EU  Directive  2009/28/EC, Renewable Ener gy Directive.  
30.2.   The representative of Malays ia referred to Malaysia 's statement delivered at th e last 
CTG Meeting, on 23  March  2018, on the amendments to the European Union Renewable Energy 
Directive (EU  RED, or RED)  and indicated that Malaysia commended the political agreement on the 
ambitious bind ing renewable energy target for the EU of at least 32% , and a target of at least 
14% for renewable energy in transport , by 2030, reached at the trialogue negotiations in Brussels, 
on 14  June 2018.  
30.3.   However, Malaysia remained concerned over the compromise te xt of the EU  RED. For 
example, the  compromise text  agreed on the phasing -out of food -crop biofuels with high indirect 
land-use change (ILUC) by 2030 , through a cer tification process for low ILUC  biofuels, which was to 
be set up by the EU  Commission. Throug h a delegated act to be adopted in 2019, the Commission 
would set  out detailed criteria for identifying both ILUC  risk biofuels and high ILUC  risk biofuels, to 
be reviewed in 2023. The European Union claims that this delegated act would be based on the 
latest and best available scientific data.  
30.4.   The press release of the European Parliament on 14  June 2018 read , in relevant part, as 
followed : "Food -crop biofuels like palm oil, which have a high 'indirect land use change ' (that is, 
changing how land from non -crop cultivation, such as grasslands and forests, with a negative impact 
on carbon dioxide emissions is used), will be phased out through a certification process for low 
indirect land use change (ILUC) biofuels, which is to be set up '. This press release wa s a source of 
great concern for Malaysia,  since the calculations of emissions from ILUC in the proposed  certification 
process for ILUC  biofuels were still questionable , and had not yet been fully endorsed by a majority 
of experts.  
30.5.   Indeed, various ILUC  models produced highly  inconsistent results , as indicated by studies 
ordered and carried out by the European Commission itself. For this reason , the European 
Commission had until now refrained from including the ILUC in its computations of greenhouse gas 
(GHG)  emissions.  
30.6.   There were also many uncertainties with regard to the assumptions being made,  including, 
among others, with regard to the methodologies  and inputs relative to oil palm plantations , and 
when estimating the GHG  emissions in the production of palm oil and projections of oil palm 
expansion on types of land that would be used.  
30.7.   Therefore, Malaysia urged the EU to ensure that its certification process for ILUC  biofuels , 
proposed to be set up by the EU  Commission , be supported by scientific evidence , and that any 
measures relating to the imposition of technical regulations be in compliance with Articles  2 to 4 , 
and other relevant articles and annexes , of the TBT  Agreement.  
30.8.   Malaysia also highlighted that the data used for the calculations of the typic al and default 
GHG emission  savings in the proposed EU  RED was not clearly specified. Malaysia had undertaken 
research on GHG emission savings on biofuels and bioliquids from palm oil, and the results indicated 
higher GHG  emission savings compared to the typical and default values in Annex  V of the new 
proposed Directive. Malaysia therefore requested  the EU 's cooperation  in shari ng the data used for 
the calculation so as to ensure its fairness, impartiality, and transparency.  
30.9.   Malaysia reiterated its readiness to extend its collaboration and to work together with the EU 
through an evidence -based approach to provide scientific data for the calculation of the typical and 
default GHG  emission savings for the production of biofuels and bioliquids from palm oil. Malaysia 
had also submitted technical data to both the Joint Research Centre of the European Commission G/C/M/132  
 
- 51 - 
 
  (JRCEC ), and the Europe an Commission itself , and requested that serious consideration be given to 
that data. 
30.10.   Malaysia, as one of the major producers and exporters of palm oil, was concerned about  the 
proposed Directive, which, in its view, was unfair and imposed unnecessary barriers on the trade in  
biofuels and bioliquids produced from palm oil.  
30.11.   As indicated in the past, Malaysia, among several other Members that were most likely to 
be affected by the proposed measures on palm oil, called again upon the European Union to notify 
its draft measures to the relevant WTO  Committee . Receiving more detailed information on the draft 
measures at an early stage , and  before they were finalized and adopted , would provide an 
opportunity not only for Malaysia but also for other Members to provide their comments. Malaysia 
would continue to monitor development s in the intended amendments to the EU RED, and looked 
forward to the EU 's response.  
30.12.   The delegate of Indones ia thanked Malaysia for raising  this issue , and wished also to register 
its own concerns. Indonesia looked forward to receiving further clarification of the EU  policy 
regarding the amendment of the EU  RED, which had been agreed jointly by the European Parliament, 
the Council of Europe, and the European Commission , in trialogue , on 14  June 2018.  
30.13.   Despite the agreement reached at the above -mentioned trialogue meeting, and also the 
clarification s that the EU ha d made and provided to Indonesia on 16  June 2018, her authorities 
wished nevertheless  to receive further information from the EU regarding the initial compromise 
relative  to a palm oil ban and phase -out of palm oil within the biofuel mix by 2030. For examp le, 
could the EU confirm that this would  no longer be applicable , and that there would in fact be no ban 
on palm oil, or phasing out of palm oil, within the EU  biofuel targets by 2030? EU  clarification had 
also emphasized that the agreement that had been reached had included a gradual reduction of the 
amount of certain categories of biofuels being counted towards the EU  renewable energy target. 
Could the EU clarify the categories concerned? Indonesia looked forward to further discuss ion of  this 
matter with the EU.  
30.14.   The delegate of Colombia  also thank ed Malaysia for having included this item on the agenda, 
and reiterated the comments that it  had made two  weeks earlier, at the TBT  Committee meeting. 
Colombia appreciated and valued the EU 's intention in adopting a policy aimed at protecting the 
environment focusing on renewable energy sources. However, Colombia also shared the concern s 
voiced by Malaysia and Indonesia,  in that this policy must be implemented in a manner not more 
trade restrictive than necessary so that it would not constitute an unnecessary barrier to trade.  
30.15.   Colombia considered that , if the current measure were to be adopted , it would be 
incompatible with the MFN  and National Treatment obligations set out under the TBT  Agree ment and 
Articles  I and III of the GATT  1994. In Colombia's view , the agreement reached in the trialogue 
could not be understood to be the final version of the EU  RED, given that the legislative process in 
the European Union contemplated the possibility of  suggesting new amendments to the proposed 
directive. Therefore, Colombia wished to register its concern regarding whether or not these 
amendments would be WTO-compatible, particularly in terms of biofuels based on palm oil.  
30.16.   He quoted information stating that, "[t]he contribution of biofuels and bioliquids from palm 
oil would be zero  per cent as of 2030", which thus explicitly indicated  that biofuels from palm oil 
would not contribute to the target in terms of land and railway transport by 2030. This would 
constitute a clear disincentive for transportation to resort to biofuel made from palm oil, and would 
make  it difficult for EU  member States to achieve the required  minimum levels of energy 
consumption on the basis of renewable sources.  
30.17.   For Colombia, the p rovision was discriminatory toward s palm oil because it would not affect 
like products such as biofuels made from other kinds of vegetable oils, such as soya and sunflower 
oil, and therefore the provision clearly favoured vegetable oils that were being produced in the 
European Union. This was not an incentive to use biofuels based on palm oil, and would negatively 
impact upon Colombia,  since palm oil was a significant and important product in its economy . He 
therefore sought clarification from the EU with regard to  its process , and  urged the EU  to avoid 
discriminatory treatment of palm oil producers , and instead to ensure coherence with the EU 's 
obligations in terms of National and MFN  treatment.  G/C/M/132  
 
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  30.18.   Colombia also requested to receive additional information concerning the trialogue 
negotiations so as to be promptly and officially informed about what had been agreed upon on 
14 June 2018 between the Counc il and the European Parliament.  
30.19.   The delegate of Guatemala  thanked Malaysia for having raised  this agenda item , which was 
one of great importance to Guatemala, in particular because of its impact on bilateral trade and on 
palm oil production, employment, and the overall situation in her country. If , as indicated in the 
media , palm oil would not be included in calcul ating biofuels for 2030, Guatemala considered that 
the trialogue negotiations may have reached a result but not a text. Therefore , the EU should confirm 
the timelines for its legislative process internally in the European Union,  and when this issue would 
be included on the agenda of the European Parliament.  
30.20.   She also seconded  Malaysia 's questions , and requested more clarity on the data used to 
determine the respective GHG. Guatemala would follow up on this issue and was ready to work on 
it jointly, both in Geneva and in Brussels.  
30.21.   The delegate of Ecuador  also registered her country 's concerns regard ing the outcome of 
the trialogue negotiations on the EU  RED. The gradual reduction of the use of palm oil leading to a 
possible total ban by 2030 would result in  a huge trade impact on palm oil producing countries.  
30.22.   She also sought further clarification fro m the EU as to if and how the way s in which palm oil 
was produced in each country would be taken into account, and whether  or not,  at this stage of the 
debate, it was still possible to make comments on the EU  RED with a view to avoid ing the negative 
impact  it would have on oil palm producing countries  in its current form . Ecuador was ready to 
participate in the drafting process of any regulation that would set down criteria for the certification 
of biofuels, which would not incur, or at least had a low risk  of incurring, ILUC.  
30.23.   The delegate of Thailand  echoed the concerns of other Members and  noted  that Thailand 
would continue to monitor this issue  closely . 
30.24.   The delegate of Honduras  said that her country had already addressed this issue in other 
WTO bodies. Ho nduras respected WTO  Members ' legitimate right to adopt public policies intended 
to protect the environment. However, such measures were required to be WTO  compliant , and must 
not restrict trade more than necessary. Palm oil was a huge industry for Honduras,  which generated 
many jobs and opportunities for small -scale farmers. Honduras controlled and supervi sed the entire  
process of palm oil production so as to protect its tropical forests. Honduras had observed  a 
significant increase in the generatio n of palm oil with a minimum environmental impact; therefore , 
it would appreciate further clarification from the EU regarding the questions addressed to it  by 
Malaysia, including in relation to the outcome of the trialogue negotiations on the EU  RED. 
30.25.   The d elegate of Costa Rica  expressed Costa Rica's interest  in the revision process of the 
EU RED; his authorities were carefully looking at the EU's methodology and would be shortly sending 
additional questions to the EU  on this issue . Costa Rica looked forward  to receiving the EU 's replies 
to the questions addressed  to it in the context both of the various WTO  bodies here in Geneva, and 
in Brussels.  
30.26.   The delegate of the European Union  indicated that the revision of the EU  RED had been 
discussed at a number of  recent bilateral meetings among experts. She also confirmed that an 
agreement had been reached among the co -legislators, the Council , and the European Parliament. 
This agreement included a gradual reduction of the amount of certain types of biofuel toward s the 
EU renewable energy targets. This was not a ban or an import restriction on palm oil or palm 
oil-based biofuels in the EU , but instead concerned the extent to which certain biofuels could be 
counted towards the EU  renewable energy targets. The text d id not single out palm oil or any other 
specific biofuel or feedstock.  
30.27.   She noted that there  was still further work at a technical level to be finalized , and that the 
agreement also foresaw that the Commission would develop rules to implement this provision  on 
the basis of the latest , best available , and  most solid, scientific information. The EU remained 
available for discussion s on this issue via the appropriate bilateral channels.  G/C/M/132  
 
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  30.28.   The Chairperson  thanked delegations for their interventions and proposed th at the Council 
take note of the statements  made.  
30.29.   The Council so agreed . 
30.2  Date of the next meeting  
30.30.   The Chairperson  informed the Council that the next meeting of the Goods Council would be 
held on Monday , 12 November , and Tuesday , 13 November  2018. T he agenda  would close at 
4.30p m on Thursday , 1 November  2018. With regard to the closing of the agenda, he reminded 
delegations that, according to the rules of procedure, meetings of WTO  bodies were convened by a 
meeting notice issued not less than ten  calendar day s prior to the date set for the meeting. 
Therefore, the  agenda itself  closed one WTO working day prior to circulation of the meeting notice ; 
in other words, 11  calendar days before the date set for the meeting.  
30.31.   The meeting was closed . 
__________