WT/REG373/M/1  
 
23 May 2018 
(18-3029) Page: 1/3 
Committee on Regional Trade Agreements  
Eighty -eighth Session    
 
ECONOMIC PARTNERSHIP  AGREEMENT BETWEEN  JAPAN AND MONGOLIA,  
GOODS AND SERVICES   
NOTE ON THE MEETING OF 9-10 APRIL 2018  
Chairm an: Ambassador Julian BRAITHWAITE (United Kingdom)  
1.1.  The 88th Session of the Committee on Regional Trade Agreements (hereinafter ' CRTA' or the 
'Committee') was convened in Airgram  WTO/AIR/RTA/13 /Rev.1  dated 29 March 2018. 
1.2.  Under Agenda Item H.II of the Session, the CRTA considered the  Economic Partnership  
Agreement between Japan a nd Mongolia , goods  and services , (hereinafter "the Agre ement").  
1.3.  The Chairman  said that the Agreement had entered into force on 7 June 2016. It ha d been 
notified to the WTO by the Parties on 1 June 2016 under Article XXIV:7(a) of the GATT 1994 and 
the Understanding on the Interpretation of Article XXIV of GATT 1994 as an Agreement 
establishing a free trade area (document WT/REG373/N/1) and under GATS Article V:7(a) as an 
Agreement providing for the liberalization of trade in services within the meaning of Article V of the 
GATS (document S/C/N/863). The text of t he Agreement was available, together with its Annexes, 
on the Parties' official websites. The Factual Presentation on the goods and services aspects 
(document WT/REG373/1 and WT/REG373/1/Corr.1 (in French only) dated 15 November 2017 and 
28 February 2018) and questions and replies on this Agreement (documents WT/REG373/2 dated 
26 March 2018 and WT/REG373/2/Add.1 dated 3 April 2018) had been distributed.  
1.4.  The representative of Mongolia  thank ed Members for their interest in the Agreement . He also 
thanked the WTO Secretariat for  the preparation of the detailed factual presentation  and Canada, 
the European Union, Mexico, Thailand, Trinidad and Tobago, and the Separate Customs Territory 
of Taiwan, Penghu, Kinmen and Matsu (hereinafter Chinese Taipei) for their ad vance questions 
regarding the Agreement. He thanked  the delegation of Japan for their continuous cooperation in 
the preparation of the review. He was delighted to brief Members on the Agreement.  
1.5.  Mongolia had been devoted and faithful to the multilateral tr ading system. It became the last 
Member of the WTO to conclude a bilateral free trade agreement. Mongolia had negotiated and 
concluded its first agreement with Japan, one of its largest trade and economic partners. The 
negotiations o n the Agreement  were la unched in June 2012. After seven rounds of negotiations, 
the Agree ment had been  concluded in July 2014, signed in February 2015  and it had entered into 
force on 7 June 2016. The Agreement complemented the multil ateral trading system and allowed  
deeper trad e and economic integration between the Parties .  
1.6.  The Agreement cover ed a broad range of issues pertaining  to, among others,  trade in goods, 
services, IPR, competition, TBT , SPS, e-commerce  and economic cooperation. The Agreement had 
the following objective s: reducing trade barriers, improving market access, increasing two -way 
trade, promoting investment, facilitating trade, easing customs procedures, enabling transfer of 
technology and skills, diversifying exports, strengthening business ties between the tw o countries 
and building greater confidence in the trade and investment regime. The Parties had made 
progress in the delivery of commitments under the Agreement.  
1.7.  Japan continue d to be one of the largest trade and investment partners of Mongolia. 
According  to Mongolia 's statistics, two way trade amounted to US$378 million in 2017, which WT/REG373/M/1  
 
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  made Japan Mongolia's  4th largest trading partner. Trade had increased by 9.7% over the previous 
year and 28% over 2015. Exports from Mongolia to Japan had increased by 5.6% over 2017.  
1.8.  Regarding investment, Japan was among the top 5 investors in Mongolia with total 
investment of nearly US$700 million. Investment from Japan had increased in recent  years : in 
2017, investment increased by 2.2 times year on year  reaching almost US$100 million , and it had 
increased 8 times compared to 2015. The Agreement  continued  to benefit businesses as well as 
the overall trade and economic relations between the Parties .  
1.9.  The Agreement, as a pioneer ing free trade agreement for Mongolia,  was a major 
breakthrough in Mongolia's  history of  free trade agreements and a milestone in its bilateral 
relationship with Japan . Mongolia would continue to work actively and closely with Japan with a 
view to creating a solid ground for further s trengthening trade and investment ties as well as 
ensuring a mutually beneficial implementation of the Agreement. He thank ed again the Secretariat 
for the work  that had enabled the review process.  
1.10.   The representative of Japan  thanked the Committee for the opportunity to present the 
elements of the Ag reement under review and consideration  by WTO members.  He also thanked  the 
Secretariat for preparing the Factual Presentation and Canada, the European Union, Mexico , 
Thailand, Trinidad and Tobago  and Chinese Tai pei for their questions which had helped Members to 
better understand  the Ag reement .  
1.11.   Japan and Mongolia had signed the Agreement in February  2015 and it had entered into 
force in June 2016. The Agreement was the 15th agreement for Japan and the first for Mongolia. As 
a result, every WTO Member now had at least one RTA  in force  and he was proud that Japan was 
the first partner for Mongolia . 
1.12.   The Agreement establishe d rules to strengthen bilateral economic relations in a wide range 
of areas such as trade in goods, rules of origin, customs procedures and trade facilitation, SPS, 
TBT, trade in services including movement of natural persons, e-commerce, investment, 
competition, intellectual property, improvement of the business environment and cooperation.  
1.13.   Japan  expect ed that the Agreement would promote liberalization and facilitation of trade 
and investment between both Parties , and deepen ed the mutually beneficial economic partnership 
in various  areas.  Also, he believe d that the Agreement w ould contribute to strength ening  the 
strategic partnership  between Japan and Mongolia.  Japan aimed  at further strengthen ing 
comprehensive  economic ties with Mongolia through steady implementation of various measures 
specified in the Agreement . 
1.14.   The Agreement established a free trade area consistent with Article XXIV of GATT and 
Article V of GATS. In terms of trade in goods, it would eliminate tariffs for approximately 96% of 
the value of two-way trade as of 2012 within ten years after the date of entry into forc e. In 
addition, t he Agreement set forth a broad range of high-level legal framework s, including for e-
commerce , investment,  trade in services  and improvement of the business environment .  
1.15.   Regarding e-commerce, the Agreement was Japan 's first RTA with a developing country that 
includ ed an e-commerce chapter. The chapter on e-commerce provide d for the maintenance of the 
practice of not imposing customs duties on electronic transmissions between the Parties, non -
discriminatory treatment of digital pr oducts, and a prohibition on  the requirement concerning the 
location of computing facilities  and the transfer or access to the source code of software.  
1.16.   The investment chapter of the Agreement provide d for national and MFN treatment for both 
pre-establishme nt and post -establishment investment s, as well as fair and equitable treatment of 
investment  and ISDS . In addition, the chapter prohibited  performance requirements, including on 
royalty  regulation . 
1.17.   Regarding the improvement of the business  environment, the sub-committee on 
improvement of the business environment was established. One of its functions was to address, 
and seek ways to promptly resolve issues relating to the business environment with a view to 
facilitating trade and investment.  Also, the chapter on improvement of the business  environment 
set forth the designation of a liaison office in each government.  The functions of such liaison 
office s include d receiv ing complaints and inquiries from the  enterprises of the other Party, WT/REG373/M/1  
 
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  transmitting them to the relevant government authorities , and seeking responses from those 
authori ties. 
1.18.   He thanked once again the Committee for the opportunity to  submit the report on the 
Agreement. The Agreement had  provided a foundation for further growth in bilateral trade and 
investment as well as for strengthening the political  ties between Japan and Mongo lia. He hoped 
that the implementation of the Agreement would contribute to strengthen ing the multilateral 
trading system with the WTO at its core . 
1.19.   The representative of Mexico  commend ed Japan and Mongolia for having signed the 
Agreement which was the first FTA for Mongolia. He thank ed the parties for the responses to 
Mexico' s questions on services and investment.  
1.20.   The representative of the European U nion thanked the Parties for the comprehensive 
presentations and the Secretariat for preparing the factual presentation. The EU was happy to 
participate in the discussion on the first RTA concluded by Mongolia. The EU had submitted a 
number of questions on  aspects of the risk management system, SPS and on restrictions  imposed 
under the Agreement  on the movement of information within and across borders and on SMEs . 
She thank ed Japan and Mongolia for the replies and she did not have follow up questions. The E U 
appreciated the ambitious scope of the e -commerce  chapter of the Agreement  and looked forward 
to cooperating with Members to see to wh at extent elements of e -commerce  chapters in RTAs 
could usefully serve as a reference for regulatory disciplines in the WTO framework. She also noted  
that the Agreement  contain ed several provisions aimed at improving  transparency and on  the 
general business environment . She asked whether any concrete activity had been carried out by 
the sub -committee on improvement of the business environment who se tasks were the 
improvements of transparency and the simplification of procedures.  
1.21.   The representative of the United States  thank ed the Parties and the Secretariat for the hard 
work in the preparati on of the review  of the Agreement . He congratulate d Mongolia on the review 
of its first RTA in the CRTA . He noted the importance placed on the growing investment 
relationship  between the Parties and the disciplines in the Agreement  that foster ed it. He als o 
noted the improvements in the services sectors relative to their commitments under the GATS and 
welcome d the additional commitments that they had undert aken, specifically the foc us put on the 
additional annexes  on financial services and telecommunication s. Those were important features of 
moder n RTAs and the additional disciplines in critical sectors  would support development and 
increase trade. He commend ed the ambitious scop e of the e -commerce chapter which included  
customs duties moratorium, discipline s on the location o f computing  services  and on source codes, 
and MFN and national treatment for digital products. Those were state of the art commitments for 
e-commerce chapters.  
1.22.   The representative of  Chinese Taipei  thanked the Parties for their response s to the advance 
questions. He appreciate d the achievement  by the Parties and thank ed the Secretariat  for the 
excellent work.  
1.23.   The representative of Canada  thank ed Japan and Mongolia for their responses to the 
advance questions. There were no further questio ns. 
1.24.   The representative of Japan  thank ed the Members  for their comments . Regarding the 
question by the European Union, the sub -committee had not met yet but he would share the 
information once available.  
1.25.   The Chairman  said that consideration of the Goods  and Services Aspects of the Economic 
Partnership Agreement between Japan and Mongolia  had allowed the Committee to clarify a 
number of questions and it could now conclude oral discussion of the RTA in accordance with 
paragraph 11 of the Transparency Mecha nism. If any delegations wished to ask follow -up 
questions they were invited to forward submissions in writing to the Secretariat by 16 April 2018  
and Parties were asked to submit replies in writing by no later than 30 April 2018 . In accordance 
with paragraph  13 of the Transparency Mechanism all written submissions, as well as minutes of 
the meeting would be circulated promptly, in all WTO  official languages, and would be made 
available on the WTO website.  
1.26.   The Committee took note of the comments made.  
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