WT/REG219/2/Rev.1
7 April 2015
(15-1881)  Page: 1/59
Committee on Regional Trade Agreements  
 
 FACTUAL PRESENTATION 
FREE TRADE AGREEMENT BETWEEN THE UNITED  STATES AND THE KINGDOM OF BAHRAIN 
(GOODS AND SERVICES) 
 Report by the Secretariat 
Revision 
This report, prepared for the consideratio n of the Free Trade Agreement between the 
United States and the Kingdom of Bahrain has been drawn up by the WTO Secretariat 
on its own responsibility and in full consultation with the Parties. The Factual Presentation reproduces as closely as possible the terminology used in the Agreement and in the comments provided and does not imply official endorsement or acceptance 
by the Secretariat of such terminology. Th e report has been drawn up in accordance 
with the rules and procedures contained in the Decision for a Transparency Mechanism for Regional Trade Agreements (WT/L/671) and thus does not imply any value 
judgement by the Secretariat regarding the contents of the Agreement.  
Any technical questions arising from this report may be addressed to 
Ms Rohini Acharya. (tel: +41 22 739 5874). Any statistical questions arising from this 
report may be addressed to Ms Rowena Cabos (tel: +41 22 739 5185). 
 
 WT/REG219/2/Rev.1 
 
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TABLE OF CONTENTS 
 
Page 
1   TRADE ENVIRONMENT ................................................................................................. 4  
1.1   Merchand ise Trade..................................................................................................... 4  
1.2   Trade in Servic es and Inve stment ................................................................................ 7  
2   CHARACTERISTIC ELEMEN TS OF THE AG REEMENT ...................................................... 9  
2.1   Background  Information ............................................................................................. 9  
3   TRADE IN  GOODS ...................................................................................................... 10  
3.1   National treatment and market access provisions on  trade in  goods ................................. 10 
3.1.1   Genera l provisions ................................................................................................. 10 
3.1.2   Import duties and charges, and quantitative restrictions .............................................. 10 
3.1.3   Liberalization of tariffs and trade .............................................................................. 12 
3.1.3.1   Liberalization by the United States ......................................................................... 12 
3.1.3.2   Liberaliza tion by Bahrain ...................................................................................... 14 
3.1.4   Tariff Rates Qu otas ................................................................................................ 16 
3.1.5   Rules of Origin ...................................................................................................... 17 
3.1.6   Export duties and charges,  and quantitative  restrict ions .............................................. 18 
3.2   Regulatory provisions on trade in goods ....................................................................... 18 
3.2.1   Standards ............................................................................................................. 18 
3.2.1.1   Sanitary and phytosanitary measures .................................................................... 18 
3.2.1.2   Technical barriers to trade .................................................................................... 18 
3.2.2   Safeguard mechanisms ........................................................................................... 19 
3.2.2.1   Global safeguards ............................................................................................... 19 
3.2.2.2   Bilateral safeguards ............................................................................................. 19 
3.2.2.3   Special safeguards .............................................................................................. 20 
3.2.3   Anti-dumping and countervailing measures ............................................................... 20 
3.2.4   Subsidie s and State-aid .......................................................................................... 20 
3.2.5   Customs-re lated procedures .................................................................................... 20 
3.3   Sector-specific provis ions on trad e in goods ................................................................. 21 
3.3.1   Textiles and clothing .............................................................................................. 21 
3.3.1.1   Emergency safeguards ......................................................................................... 21 
3.3.1.2   Specific Rules of Origin ........................................................................................ 22 
4   TRADE IN SERVICES .................................................................................................. 23  
4.1   Scope and definitions ................................................................................................ 23 
4.2   Denial of benefits ..................................................................................................... 25 
4.3   General provisions on trade in services ........................................................................ 25 
4.3.1   Mark et acce ss ....................................................................................................... 25 
4.3.2   National and MFN tr eatment .................................................................................... 25 
4.3.3   Local presence ...................................................................................................... 25 WT/REG219/2/Rev.1 
 
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  4.3.4   Movement of  natural persons .................................................................................. 25 
4.4   Liberalization commitment s/non-conforming  measures .................................................. 26 
4.4.1   The United States .................................................................................................. 26 
4.4.2   Bahrain ............................................................................................................... . 27 
4.5   Regulatory provisions on trade in services .................................................................... 30 
4.5.1   Domestic regulation ............................................................................................... 30 
4.5.2   Recognition ........................................................................................................... 30 
4.6   Commitments in sele cted services  sectors .................................................................... 31 
4.6.1   Communica tion services ......................................................................................... 31 
4.6.1.1   Express delivery services ..................................................................................... 31 
4.6.1.2   Telecommuni cations se rvices ................................................................................ 31 
4.6.1.3   Audiov isual services ............................................................................................ 33 
4.6.2   Financial services ................................................................................................... 33 
4.6.2.1   Scope and definitions ........................................................................................... 33 
4.6.2.2   Denial of benefits ................................................................................................ 34 
4.6.2.3   National and MFN tr eatment ................................................................................. 34 
4.6.2.4   Market access ..................................................................................................... 34 
4.6.2.5   Liberalization commitmen ts and non-confor ming measures ....................................... 35 
4.6.2.6   Other provisions ................................................................................................. 37 
4.6.3   Transportation services ........................................................................................... 38 
5   GENERAL PROVISIONS OF TH E AGREEMENT AFFECTING GOODS AND 
SERVICES ....................................................................................................................... 38  
5.1   Tran sparency ........................................................................................................... 38 
5.2   Current payments and capital movements .................................................................... 39 
5.3   Exceptions ............................................................................................................... 39 
5.4   A ccession  ............................................................................................................... . 39 
5.5   Institutio nal framework ............................................................................................. 39 
5.6   Disput e settlement ................................................................................................... 40 
5.7   Relationship with other agr eements concluded by the Parties .......................................... 42 
5.8   Government  Procurement .......................................................................................... 43 
5.8.1   Genera l provisions ................................................................................................. 43 
5.8.2   Tendering procedures ............................................................................................. 44 
5.9   Intellectual Property Rights ........................................................................................ 47 
5.10   Other .................................................................................................................. .. 49 
5.10.1   Labour ...............................................................................................................  49 
5.10.2   En vironm ent ....................................................................................................... 49 
ANNEX 1 ....................................................................................................................... . 51 
ANNEX 2 ....................................................................................................................... . 55 
ANNEX 3 ....................................................................................................................... . 58 
 WT/REG219/2/Rev.1 
 
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  Key Facts 
 
Parties to the Agreement:  The United States and Bahrain  
 
Date of Signature:   14 September 2005  
 
Date of Entry into Force:  1 August 2006  
 
Date of Notification:   15 September 2006  
 
Full implementation:   1 January 2015 
 
1  TRADE ENVIRONMENT1 
1.1.  The Free Trade Agreement (FTA) between the United States and the Kingdom of Bahrain 
(hereinafter referred to as "the Agreement") is the United States' third FTA with an Arab nation, 
following those with Jordan and Morocco. It is Bahrain's first FTA covering services. The Agreement is a part of the United States' initiative to create a Middle East Free Trade Area (MEFTA) by 2013. 
1.2.  In 2012, the United States' GDP was estimated at US$16,245 billion, while that of Bahrain 
was US$29,044 million in 2011. In the same year, the United States ranked third among the world's exporters of goods and first among the wo rld's importers (excluding intra-EU trade). Its 
merchandise exports amounted to US$1,545 billion (8.4% of global exports), while imports 
amounted to US$2,335 billion (representing 10%  of global imports). Bahrain ranked 51
st in terms 
of exports and 63rd in terms of imports; its total merchandise exports amounted to 
US$19,768 million, representing 0.11% of global exports, while imports amounted to 
US$12,830 million and represented 0.07% of global imports. The structure of their merchandise 
exports and imports are also considerably different, with the United States exporting and importing mainly manufactures, whereas Bahrain mainly exports fuels and imports fuels and 
manufactured products. 
1.3.  For services, the United States in 2012 was the world's second largest exporter and importer 
of commercial services (excluding intra-EU trade) , with total exports of US$630 billion and imports 
of US$416 billion (respectively 14.38% and 10.02% of world exports and imports). Bahrain was 
the 63
rd largest exporter and 94th largest importer in the same year, with commercial services 
exports of US$2,819 million and imports of US$1, 480 million (representing 0.06% and 0.04% of 
Bahrain's share in world exports and imports). The Parties' overall trade to GDP ratios are 
considerably different, 128.1 (2009-11) for Bahrain and 29.5 for the United States (2010-12). 
1.1  Merchandise Trade 1.4.  In 2013, the United States was Bahrain's eighth largest merchandise export market and fifth 
largest merchandise import source. Bahrain was the United States' 66
th largest export destination 
and 60th largest source of imports.2 
1.5.  Recent developments in global and intra-Party trade are presented in Chart 1.1. Over the 
period 2000-2013, the United States has run a constant merchandise trade deficit with the world. 
With Bahrain, it had a merchandise trade deficit for much of the period until 2007 but has had a surplus since then. During the same period, Bahrain's trade surplus with the world remained constant until 2006 when it widened as a result of an increase in exports but has since narrowed 
(data available up to 2010). 
                                               
1 Unless otherwise indicated, the data from this section are sourced from WTO Statistics Database, 
Trade Profiles (March 2014). 
2 UNSD, Comtrade database (2014). WT/REG219/2/Rev.1 
 
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  Chart 1.1 United States and Bahrain: bilateral and total merchandise trade 
012345
05101520
2000
2001200220032004
2005
200620072008200920102011B. Bahrain 2000-2011
(US$ billions)
Imports from USA (Right Axis)
Exports to USA (Right Axis)
Total Imports
Total Exports
05101520
05001,0001,5002,0002,5003,000
2000
2001
2002
20032004
2005
200620072008
2009
20102011
2012
2013A. United States 2000-2013
(US$ billions)
Imports from Bahrain (Right Axis)
Exports to Bahrain (Right Axis)
Total Imports
Total Exports
 
Source: UNSD, Comtrade database. 
1.6.  The commodity structure of trade between the Parties, as well as of their imports and exports 
to the world in the period 2003-2005, is shown in Chart 1.2 (before entry into force of the 
Agreement) and in Chart 1.3 for the period 2009-11 on the basis of the Harmonized System (HS) sections.  
1.7.  Chart 1.2 shows the United States' three top categories of exports to the world during 
2003-2005 were machinery and mechanical appliances (33.2%); vehicles, aircrafts and vessels 
(14.9%); and chemical or allied industries products (10.4%). The same three categories formed Bahrain's top imports from the United States, accounting for 62.5% of bilateral imports. Machinery 
also accounted for 25.7% of the United States' to tal imports from the world, followed by mineral 
products (15.2%), and vehicles, aircrafts and vessels (13.9%). During this period, over three-quarters of Bahrain's exports to the world were mineral products (76.5% of the total), followed by base metals (13.6%) and textiles (2.7%). In contrast, textiles and related articles 
alone represented 44.9% of imports by the United  S t a t e s  f r o m  B a h r a i n ,  f o l l o w e d  b y  c h e m i c a l s  
(16.7%) and base metals (12.9%). Mineral products accounted for 45.9% of Bahrain's global imports; machinery and mechanical appliances a ccounted for 12.8% of imports from the world and 
for 32.2% by the United States, vehicles, aircrafts and vessels represented 8.8% of global imports 
and 23.5% of bilateral imports. Prepared foodstuff and beverage also accounted for 11.4% of Bahrain's total imports from the United States, as its third largest import product category. 
1.8.  The Parties' bilateral trade appears to have become more specialized in more recent years as 
shown in Chart I.3. The share of the three largest categories of imports by the United States from 
Bahrain grew from almost 70% to 83%, with significant growth in the share of base metals and especially chemicals and a decline in the share of  textiles imports. The share of Bahrain's two 
largest categories of imports from the United States (machinery and vehicles) grew from 55% to 
63%, while the share of prepared foods (the third largest import category during 2003-05) fell from 11% to 4%. WT/REG219/2/Rev.1 
 
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  Chart 1.2 United States and Bahrain: produc t composition of merchandise trade, annual 
average (2003-2005) 
45
1713818United States imports from Bahrain (%)
26
15
147654332213United States' Global Imports (%)
7714334Bahrain's Global Exports (%)
32
2311744333324Bahrain's imports from United States (%)
46
1397633211Bahrain's Global Imports(%)
33
15
116554333229United States' Global Exports(%)Total: US$ 429 million Total: US$ 1,521 billion
Total: US$ 7.2 billionTotal: US$ 815 billionTotal:  US$ 8.1 billion
Total: US$ 256 million
 
Source: UNSD, Comtrade database. WT/REG219/2/Rev.1 
 
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  Chart 1.3 United States and Bahrain: produc t composition of merchandise trade, annual 
average (2009-2011)  
34
3415215United States imports from Bahrain (%)
26
19
108554332211United States' Global Imports (%)
781228Bahrain's Global Exports (%)
34
2985443337Bahrain's imports from United States (%)
50
148653311Bahrain's Global Imports(%)
26
15
12 8655543211United States' Global Exports(%)Total: US$ 499 million Total: US$ 1,944 billion
Total: US$ 15.2 billionTotal: US$ 1,271 billionTotal:  US$ 15.7 billion
Total: US$ 675 million
 
Source: UNSD, Comtrade database. 
1.2  Trade in Services and Investment 
1.9.  Chart 1.4 shows the breakdown of commercial services trade for the United States in 
2000-2012. The total value of commercial services increased by 25%, both in terms of exports and 
imports. The United States remains a net exporter of commercial services globally. The top three 
categories for both exports and imports were transportation and travel services, and 
communication services. Other key imports are insurance services, while royalties and licence fees and financial services are growing exports. WT/REG219/2/Rev.1 
 
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  Chart 1.4 United States trade in se rvices data with world, 2000-2012 
0100200300400500600700
2000 2002 2004 2006 2008 2010 2012A. United States imports from world
2000-2012
(US$ Billion) 
0100200300400500600700
2000 2002 2004 2006 2008 2010 2012B.United States exports  to world
2000-2012
(US$ Billion) 
 
Note:  no trade data in 2012 for Construction; Computer and information services; and Personal, cultural 
and recreational services. 
Source: WTO Statistics database. 
1.10.  Chart 1.5 shows the breakdown of commercial services trade for Bahrain in 2000-2012. 
Total exports of commercial services have increased steadily, especially from 2003. Imports have grown more slowly. Bahrain's exports and imports of commercial services are dominated by travel, 
and transportation services, with communication an d insurance services playing an important role 
in exports of services since 2003.  
Chart 1.5 Bahrain trade in services data with world, 2000-2012 
012345
2000 2002 2004 2006 2008 2010 2012A. Bahrain imports from world
2000-2012
(US$ Billion) 
012345
2000 2002 2004 2006 2008 2010 2012B.Bahrain exports  to world
2000-2012
(US$ Billion) 
 
Note: no trade data in 2000-2012 for Construction; Financial services; Computer and information services; 
Royalties and licence fees; and Personal, cultural  and recreational services. No trade data for 
Communications services (2000-2003). No export data for insurance services (2000-2003). 
Source: WTO Statistics database. 
1.11.  Chart 1.6 shows inward and outward stocks an d flows of FDI of the Parties with the world in 
2000-2012. The United States' outward investments have grown at an annual average rate of around 8%% over the period surveyed, reac hing US$5,191 billion in value by 2012. The 
United States' FDI from the world also grew, but at a lower rate, amounting to US$3,931 billion in 
value by 2012. Over the same period, Bahrain's inward stock of FDI has grown at an annual WT/REG219/2/Rev.1 
 
- 9 - 
 
  average rate of almost 10%, amounting to US$16.8 billion by value in 2012, while its stock of 
outward FDI grew by 16%, reaching US$9.7 billion  in value in 2012. FDI flows for both countries 
have been volatile during this period in part due to the global financial crisis. 
Chart 1.6 United States and Bahrain: FDI stock and flow with world 
01,0002,0003,0004,0005,0006,000
2000 2002 2004 2006 2008 2010 2012A. United States FDI stock with world
2010-2012
(US$ Billion) outward
inward
050100150200250300350400450
2000 2002 2004 2006 2008 2010 2012A. United States FDI flow with world
2000-2012
(US$ Billion) outward
inward
024681012141618
2000 2002 2004 2006 2008 2010 2012C. Bahrain FDI stock with world
2000-2012
(US$ Billion) outward
inward
-3-2-101234
2000 2002 2004 2006 2008 2010 2012D. Bahrain FDI flow with world
2000-2012
(US$ Billion) outward
inward
 
Source: UNCTAD. 
2  CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
2.1  Background Information 
2.1.  The Agreement was signed by the United Stat es and Bahrain (hereinafter referred to as "the 
Parties") on 14 September 2005 and entered into force on 1 August 2006.  
2.2.  The goods and services aspects of the Agreem ent were notified to the WTO by the Parties on 
15 September 2006 under Article XXIV of the GATT 1994 and the Understanding on the 
Interpretation of Article XXIV of GATT 1994, and Article V of the GATS, respectively (WT/REG219/N/1 and S/C/N/375). The text of the Ag reement is available, together with its related 
annexes, on the following official websites: 
U.S.:   http://www.ustr.gov/trade-agreements/free-tr ade-agreements/bahra in-fta/final-text   
Bahrain:  http://www.fta.gov.bh/categ oryList.asp?cType=Texts  
2.3.  The Agreement is composed of 21 Chapters and has a number of related Annexes to several 
Chapters and side letters3, as follows: 
                                               
3 The side letters are on tariff classification (Cha pter 4), gambling and immi gration (Chapter 10), cross 
border insurance suppliers and indepe ndent agents (Chapter 11), technology neutrality and interconnection WT/REG219/2/Rev.1 
 
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  Box 2.1 Structure of the Agreement 
Chapters, Annexes and Side Letters Title/description 
Preamble  
Chapter 1 Initial Provisions and Definitions 
Chapter 2 National Treatment and Market Access for Goods 
Chapter 3 Textiles and Apparel 
Chapter 4 Rules of Origin 
Chapter 5 Customs Administration 
Chapter 6 Sanitary and Phytosanitary Measures 
Chapter 7 Technical Barriers to Trade 
Chapter 8 Safeguards 
Chapter 9 Government Procurement 
Chapter 10 Cross-Border Trade in Services 
Chapter 11 Financial Services 
Chapter 12 Tele communications 
Chapter 13 Electronic Commerce 
Chapter 14 Intellectual Property Rights 
Chapter 15 Labour 
Chapter 16 Environment 
Chapter 17 Transparency 
Chapter 18 Administration of the Agreement 
Chapter 19 Dispute Settlement 
Chapter 20 Exceptions 
Chapter 21 Final Provisions 
Source: Free Trade Agreement between the United States and Bahrain. 
3  TRADE IN GOODS 
3.1  National treatment and market access provisions on trade in goods 
3.1.1  General provisions 3.1.  Under Article 2.2, each Party provides national treatment to the other Party's goods in 
accordance with Article III of the GATT 1994 and its interpretative notes, which are incorporated 
mutatis mutandis  into the Agreement. With respect to a regional level of government
4, each Party 
shall apply treatment no less favourable than the most favourable treatment that that level of 
government accords to any like, directly competitive, or substitutable goods, as the case may be, 
of the Party of which it forms a part.  
3.2.  Exceptions to national treatment (Article 2.2.1 and 2) and to provisions on import and export 
restrictions (Article 2.8.1 through 4) are contained in Annex 2-A These provisions shall not apply 
to measures relating to: (i) controls on the export of logs of all species; (ii) measures existing under domestic maritime transpor t legislation to the extent that such measures were mandatory 
legislation at the time the United States accede d to the GATT 1947 and have not been amended so 
as to decrease their conformity with Part II of GATT 1947, as well as their continuation or prompt 
renewal and the amendment of non-conforming pr ovisions thereof provide that the amendment 
does not decrease the conformity of the provis ion; (iii) actions authorized by the Dispute 
Settlement Body of the WTO; and (iv) actions authorized by the Agreement on Textiles and 
Clothing. Regarding Bahrain the provisions shall not apply to: (i) prohibitions on the import of retreaded tires for ten years from the effective date  of the Agreement; and (ii) actions authorized 
by the Dispute Settlement Body of the WTO. 
3.1.2  Import duties and charges,  and quantitative restrictions 
3.3.  Chapter 2 contains provisions on liberalization of trade in goods by a Party (Article 2.1), while 
the tariff elimination commitments are detailed in Annex 2-B and in each Party's Schedules to this 
Annex. Annex 2-B provides for a phase-out period of 10 years starting from the date of the 
Agreement's entry into force. Duty elimination shal l proceed in accordance with various stages as 
                                                                                                                                               
rates (Chapter 12), and limitations on liability for services providers, optical discs and public health 
(Chapter 14). 
4 Regional level of government  applies only to the United States and consists of, a state of the 
United States, the District of Columb ia and Puerto Rico (Article 1.3). WT/REG219/2/Rev.1 
 
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  detailed in the Annex and is to be completed by 1 January 2015. Each Party has set out in its 
Schedule additional staging categories for tariff reductions and elimination. For those products that were already exempted from customs duties on an  MFN basis, duty-free treatment was maintained 
when the Agreement entered into force. The Parties may at a later date discuss the possibility of 
accelerating the elimination of customs duties (Article 2.3.3). 
3.4.  In addition, the United States will apply a system of tariff quotas on specific agricultural 
products imported from Bahrain, as set out in its Schedule to Annex 2-B (see TRQs Section below). 
3.5.  Under Article 2.3, neither Party may increase any existing, nor adopt any new customs duty 
on an originating good. However, a Party may raise a customs duty back to the level established in its Schedule following an unilateral tariff reduction or maintain or increase a customs duty as authorized by the WTO's Dispute Settlement Body.  
3.6.  Article 2.4 prohibits the adoption of new, or the expansion of existing, waivers of customs 
duties based, explicitly or implicitly, on the fulfilment of a performance requirement. 
3.7.  There are also special regimes providing for the temporary duty-free entry of products. 
Regardless of their origin, duty-free temporary admission shall be granted for professional 
equipment; goods intended for display or demonstration; commercial samples and advertising films and recordings; and goods imported for sports purposes (Article 2.5.1). The period of 
temporary admission may be extended by a Party upon request of the interested person and for 
reasons its customs authorities consider to be valid. The only conditions which may be placed on the duty-free admission of such goods are listed in Article 2.5.3.
5 If any of these conditions has not 
been fulfilled, the Party may apply the customs duty or any other charge normally applicable to 
the good in question. Each Party shall also adopt procedures for the expeditious release of a 
temporarily admitted good, permit its export through a customs port other than that of admission, and relieve the importer or other responsible person from any liability for failure to export a good 
that has been destroyed. Where a good re-enters a Party's territory after reparation or alteration, 
it cannot be subject to customs duties, providing that such repair or alteration does not: (a) destroy a good's essential characteristics or create a new or commercially different good; or 
(b) transform an unfinished good into a finished good (Article 2.6). Duty-free entry shall also be 
granted to commercial samples of negligible value and to printed advertising materials imported from the territory of any of the Parties (Article 2.7).  
3.8.  Import and export prohibitions or restrictions may not be adopted or maintained by the 
Parties, except as provided for in Article XI of  the GATT 1994 and its interpretative notes, which 
are incorporated mutatis mutandis  into the Agreement. Such prohibitions include: (i) price 
requirements except under enforcement of coun tervailing and anti-dumping duty measures; 
(ii) measures conditioning the grant of an import license on the fulfilment of a performance 
requirement; or (iii) voluntary export restraints inconsistent with Article VI of GATT 1994, as implemented under Article 18 of the WTO Agreement on Subsidies and Countervailing Measures 
and Article 8.1 of the WTO Agreement on Implem entation of Article VI of GATT 1994. When a 
Party maintains a prohibition or restriction on the import from or export to a non-party of a good, it may prohibit or limit the import of that good of the non-party from the territory of the other Party. In such a case, the Parties shall consult to avoid undue interference with or distortion of 
pricing, marketing, and distribution arrangements in the other Party (Article 2.8).  
3.9.  Under Article 2.9, the Parties will ensure that all administrative fees and charges in 
connection with the import and export of goods ar e limited to the approximate cost of the service 
rendered and do not represent an indirect protection to domestic goods or a taxation of imports or 
exports for fiscal purposes. They shall also not require consular transactions, including related fees and charges, in connection with the import of any goods. The United States will also eliminate its 
merchandise processing fee on originating goods. The current list of fees and charges applied by 
the Parties in connection with imports and exports shall be made available on Internet. 
                                               
5 These include: that the good be used solely by or under the personal supervision of a national or 
resident of the other Party in the exercise of his or her business activity, trade, spor t or profession; not be sold 
or leased while in the Party's territo ry; be accompanied by a security equi valent to the charges otherwise owed 
on entry or final importation of the good; be capable of  identification when exported and be exported on the 
departure of the person temporarily im porting the good; be imported in a qu antity reasonable for its intended 
use; and be otherwise admiss ible under the Party's laws. WT/REG219/2/Rev.1 
 
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  3.1.3  Liberalization of tariffs and trade 
3.10.  Trade in goods under the Agreement is classified under the Harmonized Commodity 
Description and Coding System (HS), as adopted and implemented by the Parties in their respective tariff laws (Article 1.3). The elimination of tariffs will proceed in accordance with the 
phase-out period scheduled in Annex 2-B, where goods to which tariffs elimination applies are 
divided into three staging categories, as follows:  
a. Category A: customs duties on such goods are to be eliminated on the date of the 
Agreement's entry into force (1 August 2006);  
b. Category B: customs duties on such goods are to be reduced in ten equal annual stages 
beginning 1 August 2006 ("year one") and eliminated on 1 January of the tenth year (2015). As of the second year (2007), each annual tariff reduction shall take effect on 
1 January of the relevant year; and  
c. Category C: goods in this category shall continue to receive duty-free treatment.
6 
3.11.  The base rates of duty for determining the interim rate of custom duty at each stage of 
reduction is the rate of duty in effect in January 2003.  
3.1.3.1  Liberalization by the United States  3.12.  In its Schedule to Annex 2-B, the United States added four staging categories to those 
already provided for in the Annex, plus a system of tariff quotas mainly on agricultural products 
imported from Bahrain. The additional staging categories are:  
a. Category D: duties are to be reduced in five equal annual stages beginning on 
1 August 2006 and eliminated on 1 January 2010;  
b. Category E: duty-free treatment as from the Agreement's entry into force. For specific 
tariff lines listed in this category, duty-free means free without bond
7;  
c. Category F: duty-free treatment on the date  of the Agreement's entry into force in 
accordance with existing WTO duty elimination commitments by the United States in its 
WTO Schedule XX; and  
d. Category G: duties are to be eliminated on 1 January 2015. Until then, for articles and 
goods imported after being assembled abroad in whole or in part of fabricated 
components (under HS 98020080); for rum, tafia, liqueurs and spirituous beverages (under HS 98172205); and for articles of ski racing apparel specially designed to protect against injuries from ski racing (HS 9817610 1), the duty on the assembled imported 
article shall be applicable to the full value of the article itself under the staging 
obligations in Chapters 1-97 of the United States' Schedule.  
3.13.  Table 3.1 shows the United States' tariff elimination in terms of number of lines and value of 
trade, as applied to imports from Bahrain. The United States' MFN tariff schedule in the year of 
entry into force of the Agreement (2006) comprised 10,309 tariff lines at the HS 8-digit level, of 
                                               
6 Products falling in Category C already benefited from duty free treatment at the MFN level when the 
Agreement entered into force in 2006. In the case of Bahrain, only one tariff line (HS 3006.70.00, gel preparation used in human and veterinary medicine) was subject to a 5% duty, based on the 2003 MFN rates of duty. 
7 These products are covered under Section XXII, Chap ter 98 "Special classification provisions" of the 
United States HS, and include: Subchapter XII "Artic les admitted free of duty under bond for permanent" 
exhibition (9812.00.20; 9812.00.40); Subchapter XIII "Articles admitt ed temporarily free of duty under bond" 
(9813.00.05, 9813.00.10, 9813.00.15, 9813.00.20, 9813.00.25, 9813.00.30, 9813.00.35, 9813.00.40, 
9813.00.45, 9813.00.50, 9813.00.55, 9813.00.60, 9813. 00.70, 9813.00.75); and Su bchapter XIV "Tea 
admitted free under bond" (9814.00.50). WT/REG219/2/Rev.1 
 
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  which 10.7% held non ad valorem  duties.8 Before the entry into force of the Agreement, 
3,872 tariff lines (37.6% of the tariff) were already duty-free on an MFN basis. This figure corresponded to 17.4% of imports from Bahrain during the 2003-2005 period. Upon entry into force of the Agreement, an additional 6,091 tariff lines (59.1% of the tariff) became duty-free for 
imports from Bahrain although a number of these lines are already duty free under the 
Generalized System of Preference (GSP) market access offered by the United States to Bahrain. In 2010 an additional 68 lines (0.7% of total lines)  followed by 278 lines (2.7% of the total) in 
2015 are to be liberalized; the liberalization in 2015 includes those lines that are subject to tariff 
rate quotas during the implementation period (Section C below). As a result, 100% of the United States' tariff lines is to become duty-free by 2015, corresponding to 100% of its imports from Bahrain. 
Table 3.1 The United States' tariff elimin ation commitments under the Agreement and 
corresponding average trade 
Duty phase-out 
period Number of 
lines % of total lines in 
USA's tariff 
schedule Value of USA's imports 
from Bahrain (2003-
2005) 
in million US$ % of USA's total 
imports from 
Bahrain 
2003-2005 
MFN duty free (2006) 3,872 37.6 57.9 17.4 
2006 6,091 59.1 275.4 82.6 
2010 68 0.7 0.0 0.0 
2015 278 2.7 0.0 0.0 
Total 10,309 100.0 333.3 100.0 
Note: Excludes data beyond HS Chapter 97. 
Source:  WTO estimates based on data provided by the USA and the WTO-TPR (2006). 
3.14.  A more detailed perspective of the United  States' duty elimination up to the end of the 
transitional period (2015) is presented in Chart 3. 1. At the entry into force of the Agreement, 39% 
of the United States' tariff was already duty free on an MFN basis. In 2006, most (45%) of the 
additional tariff lines liberalized for imports from Bahrain, were subject to MFN duties up to 10%. 
The 68 tariff lines that are to be liberalized in 2010 (corresponding to Category D) consist of 7 lines with MFN duties up to 10%, 43 lines with duties up to 20%, and 18 lines with specific 
duties. At the end of the implementation period, th e additional 278 lines that are to be eliminated 
include 12 lines with rates above 50% and 113 with specific duties. 
Chart 3.1 United States' duty elimination under the Agreement 
0 1,500 3,000 4,500 6,000 7,500 9,000 10,500200620102015Year of duty-free treatment
Duty Free <=10 <=20 <=30 <=40 <=50 > 50 specific duty MFN is: 
Source: WTO Secretariat estimates based on data provided by USA and WTO-TPR. 
                                               
8 The non- ad valorem  duties are applied to 1,090 tariff lines, of which 637 are specific duties, 304 are 
compound duties, 7 are mixed duties and 142 ar e other duties. The Secretariat has used the ad valorem  
component of the tariff lines in its calculat ions for the purpose of  this presentation. WT/REG219/2/Rev.1 
 
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  3.15.  Table 3.2 shows the United States' tariff elimination commitments vis-à-vis Bahrain by 
HS section product categories. At the entry into fo rce of the Agreement (2006), in addition to the 
3,872 lines whose MFN duties were zero, 6,091 lines covering all HS Sections were made duty-free for imports from Bahrain. The additional 68 lines to be liberalized in 2010 mainly relate to 
agricultural products (Sections I-IV), while the remaining 278 lines mainly cover agricultural 
products (HS Sections I-IV) and footwear and articles  of stone, and are to be liberalized at the end 
of the implementation period in 2015.  
Table 3.2 USA: Tariff elimination un der the Agreement, by HS section 
HS Section MFN average% No. of lines MFN 2006 Number of duty-free lines  
2006 2010 2015 
I 4.7 428 150 187 4 87 
II 5.4 505 136 324 23 22 
III 3.7 67 18 44 2 3 
IV 11.4 647 133 352 38 124 
V 0.5 203 154 49   
VI 3.5 1,707 543 1,164   
VII 3.7 373 86 287   
VIII 4.3 222 44 178   
IX 2.2 193 119 74   
X 0.0 288 288    
XI 8.8 1,591 221 1,363 1 6 
XII 12.1 168 34 117  17 
XIII 5.0 283 96 176  11 
XIV 3.0 105 48 57   
XV 1.8 991 531 460   
XVI 1.6 1,442 796 638  8 
XVII 2.6 240 123 117   
XVIII 2.2 531 188 343   
XIX 1.2 40 25 15   
XX 2.8 278 132 146   
XXI 0.0 7 7    
Total 4.3 10,309 3,872 6,091 68 278 
Note: For tariff lines subject to TRQs only the out-of-quota duty is included in the tariff-related 
calculations; lines with sp ecific duties and the non- ad valorem  component of lines with compound 
and alternate rates are excluded from the calculations; excludes data beyond HS Chapter 97. 
Source: WTO estimates based on data provided by USA and the WTO-TPR. 
3.1.3.2  Liberalization by Bahrain 
3.16.  In the general note to its Schedule, Bahrain added two staging categories to those listed in 
Annex 2-B: 
a. Category H: duties are to remain at the 2003 MFN level during 2006-2014 and are to be 
removed on 1 January 2015. For these goods, Bahrain reserves the right to establish 
regulatory measures or apply fees or excise charges pertaining to their distribution, sale, 
or consumption, provided that such measures, fees, or charges are not inconsistent with the terms of the Agreement or the WTO Agreements; and  
b. Category I: contains products that are prohibited for import.
9 Duties for these products 
are to remain at the 2003 MFN level during 2006-2014 and are to be removed on 1 January 2015. Bahrain may continue to prohib it the import of such products, provided 
that the prohibition is not inconsistent with the terms of the Agreement or the WTO 
Agreements. In 2006 all the lines in category I were prohibited from import and do not 
have corresponding tariff rates, apart from niger seed (HS 1207.99.10) that was not prohibited in 2006 and had an ad valorem  duty rate of 5%.  
3.17.  In addition, Bahrain's Schedule includes 36 lines that were prohibited in 2006 on an MFN 
basis but were liberalized for import from the United States on the date the Agreement entered into force (Category A), except one line on retreaded or used rubber pneumatic tires used in motor 
                                               
9 The 16 tariff lines include live swine, ivory, mace, oils seeds, plants, vegetable saps and extracts, 
cocaine, cultured pearls, and worked ivory and ivory products. WT/REG219/2/Rev.1 
 
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  vehicles (HS 4012.11.00) which remains subject to a 5% duty until 2014 (Category H). Details on 
these lines are provided in Annex III to this presentation. 
3.18.  Table 3.3 shows Bahrain's overall tariff liberalization in terms of the number of lines and 
value of imports from the United States. Bahrain's MFN tariff schedule in 2006 comprised 
7,177 tariff lines at the HS 8-digit level, out of which 19 held non ad valorem  duties.10 Before the 
entry into force of the Agreement, 427 tariff lines (5.9% of Bahrain's tariff and 4.6% of imports from the United States) were already duty-free on an MFN basis. Upon entry into force of the 
Agreement, an additional 6,667 tariff lines became  duty-free. This figure corresponded to 92.9% 
of the tariffs and to 88.2% of Bahrain's total imports from the Unites States in the period 
2003-2005. The remaining 82 lines are to be liberalized by January 2015. As a result, at the end of the implementation period Bahrain will have liberalized all its tariff lines for imports from the 
United States. For imports under 16 lines (0.2% of tariff lines) Bahrain agreed to eliminate duties 
by January 2015 but reconfirmed its general right to prohibit these items if done in a manner that 
is consistent with the terms of the Agreement and with the WTO Agreement. 
Table 3.3 Bahrain's tariff elimination commitments under the Agreement and 
corresponding average trade 
Duty phase-out 
period Number of 
lines % of total lines 
in Bahrain's 
tariff schedule Value of Bahrain's 
imports from USA 
(2003-2005) 
in million US$ % of Bahrain's 
total imports 
from USA 
2003-2005 
MFN duty free (2006) 427 6.0 12.5 4.6 
2006 6,667 92.9 240.0 88.2 
2015* 82 1.1 19.6 7.2 
Total 7,176 100.0 272.2 100.0 
Note: *16 lines (0.2% of tariff lines) where Bahrain agreed to eliminate duties by January 2015 but 
reconfirmed its general right to prohibit the import of these products if done so in a manner that is consistent with the terms of the Agreement and the WTO Agreements.  
 Based on the HS 2002 nomenclature. 
Source: WTO estimates based on data pr ovided by Bahrain and the WTO-TPR. 
3.19.  Details of Bahrain's duty elimination up to  the end of the transitional period (2015) are 
shown in Chart 3.2. Almost all of Bahrain's tariff lines (92.9%) that were eliminated at the entry 
into force of the Agreement consisted of MFN duti es up to 10%. At the end of implementation, 
28 and 37 lines with MFN duties respectively of up to 20% and between 20% and 50% will be fully 
liberalized. 
Chart 3.2 Bahrain's duty elim ination under the Agreement 
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,00020062015
Number of duty-free lines (cumulative)Year of duty-free treatment
Duty Free <=10 <=20 <=50 specific duty MFN is: 
Source: WTO Secretariat estimates based on data provided by Bahrain and WTO-TPR. 
                                               
10 All of them are compound rate tariffs.  WT/REG219/2/Rev.1 
 
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  3.20.  Table 3.4 shows Bahrain's tariff elimination commitments vis-à-vis the United States by 
HS section product categories. At the entry into force of the Agreement (2006), 6,667 lines covering all HS Sections were made duty-free for imports from the United States; the remaining 66 lines, to be liberalized in 2015, cover mostly prep ared foods (Section IV) but also include swine, 
ivory and worked ivory and related articles; mace; oil seeds; plants; vegetable saps and extracts; 
cocaine; and cultured pearls. 
Table 3.4 Bahrain: Tariff elimination under the Agreement, by HS section 
HS Section MFN average% No. of lines MFN 2006 Number of duty-free lines  
2006 2015* 
I 3.3 334 113 217 4 
II 3.0 426 164 254 8 
III 5.0 61  61  
IV 14.9 389 16 336 37 
V 4.8 214 7 207  
VI 4.9 1,099 42 1,052 5 
VII 5.3 271  265 6 
VIII 5.0 98  98  
IX 5.0 196  196  
X 4.4 204 35 165 4 
XI 5.0 1,016  1,015 1 
XII 5.0 83  83  
XIII 5.0 229  229  
XIV 3.1 65 23 40 2 
XV 5.2 744  736 8 
XVI 5.0 949 1 948  
XVII 4.5 247 26 221  
XVIII 5.1 299  297 2 
XIX 5.0 26  26  
XX 5.3 216  211 5 
XXI 5.0 10  10  
Total 5.3 7,176 427 6,667 82 
Note: *16 lines (0.2% of tariff lines) where Bahrain agreed to eliminate duties by January 2015 but 
reconfirmed its general right to prohibit the import of these products if done so in a manner that is consistent with the terms of the Agreement and the WTO Agreements. 
 Based on the HS 2002 nomenclature. 
Source:  WTO estimates based on data provided by Bahrain and the WTO-TPR. 
3.1.4  Tariff Rates Quotas 
3.21.  The United States provides access, in addition to its WTO tariff rate quotas (TRQs), under 
the Agreement for imports of beef, dairy products, peanuts, sugar and sugar products, cotton and 
tobacco, covering 189 tariff lines at the HS 8 digit level (Annex 1 to the Tariff Schedule of 
the United States) (see Table A2.1 in Annex 2 to this presentation). The TRQ volume for all these products will be increased by approximately 10% every year, apart from sugar and sugar-
containing products, whose volume will expand by approximately 5% annually. The out-of-quota 
duties will be phased-out in accordance with the timetable of Category B (i.e. out-of-quota duties shall be removed in ten equal annual stages as from the Agreement's entry into force)
11; full 
liberalization is to be completed by 1 January 2015. The duty applied to imports from Bahrain 
within the quota quantity for each product is zero from the Agreement's entry into force.  
3.22.  Bahrain does not have TRQs either under the Agreement or in the WTO. 3.23.  Additional liberalization is also provided for textiles and clothing under the 
Agreement: under Article 3.2.8, each Party shall accord preferential tariff treatment to certain 
non-originating textiles and apparel products, mainly cotton or man-made fibre fabrics, and apparel and man-made articles, when imported within an annual total quantity of 65 million square 
meters equivalent in each of the first ten years after the Agreement's entry into force (see section 
on textiles and clothing). 
                                               
11 Originating goods included in Annex 1 are subject to the rates of duty as set out in the United States' 
Schedule to the Agreement in lieu  of the rates of duty set out in Chapters 1 through 97 of the United States 
HS. WT/REG219/2/Rev.1 
 
- 17 - 
 
  3.1.5  Rules of Origin 
3.24.  The Agreement provides for general disciplines on rules of origin under Chapter 4, with 
product specific rules under Annex 4-A (Certain Product-Specific Rules of Origin), and for textiles and clothing under Chapter 3 (Textiles and Apparel) (see section C.1 below).  
3.25.  According to Article 4-1, a good is originating when it is imported directly from the territory 
of one Party into the territory of the other and it is "wholly the growth, product or manufacture" of one or both of the Parties.
12 In addition, certain goods are covered by specific rules of origin in 
Annexes 3-A or 4-A (which are described below); a good may also be originating where it is 
"a new or different article of commerce" that has been grown, produced or manufactured in one or 
both of the Parties and the sum of (i) the value of  materials produced in the territory of one or 
both of the Parties, plus (ii) the direct costs of processing operations performed in the territory of 
one or both of the Parties, is not less than 35% of the appraised value of the good at the time it is 
imported into the territory of a Party (Article 4.1(b)).13  
3.26.  The calculation of the value of materials produced in the Parties' territories and the direct 
costs of processing operations are detailed in Ar ticles 4.5 and 4.6 respectively. Packaging, packing 
materials and containers for retail sales and shipment of a good, as well as the use of indirect material
14 shall be disregarded except if they count towards satisfying the 35% value requirement. 
Simple combining or packaging operations and dilution with water or another substance that does 
not materially alter the characteristic of the good do not qualify for considering a good to be a new or different article of commerce for the purpose of determining whether a good is an originating good (Article 4.3). In a Side Letter on Tariff Classification dated 14 September 2004, the Parties 
agreed to be guided by the specific rules in Section 102.20 of the United States' Customs 
Regulations to determine the status of a good in accordance with Article 4.1(b) of the Agreement.  
3.27.  The Agreement provides for bilateral cumulati on both in terms of processing operations and 
the value of materials produced in the Parties' territories (Article 4.4). In light of the Parties' desire 
to promote regional integration in the Middle East, at  a time to be determined by the Parties, they 
shall enter into discussions to determine the extent to which goods produced in the region can 
count towards meeting the Agreement's origin requir ement as a step towards this goal of regional 
integration (Article 4.13).  
3.28.  To qualify for preferential treatment, the originating good must be imported directly from 
the territory of the other Party without undergoing subsequent production, manufacturing, or any 
other operation outside the Parties' territories, other than unloading, reloading, or any other 
operation necessary to preserve it in good conditio n or to transport the good to the territory of the 
other Party (Article 4.9). The importer, to qualify for preferential tariff treatment, shall submit to 
the customs authorities of the importing Party, upon request, a declaration setting forth all 
pertinent information on the growth, production and manufacture of the good. The declaration should be requested only when: a Party has re ason to question the accuracy of a deemed 
certification for a good; the Party's risk assessment procedures indicate that the verification of a 
claim is appropriate; or when the Party conducts a random verification (Article 4.10).  
3.29.  The Parties agree to consult and cooperate to ensure the proper implementation of this 
Chapter and to establish, if necessary, ad hoc  working groups or a sub-committee of the 
Joint Committee to consider any matter relating to the Chapter on rules of origin (Article 4.12).  
3.30.  For prepared foods, including sugars  and sugar confectionary; cocoa and cocoa 
preparations; preparations of vegetables, fruits, nuts or other parts of plants; and miscellaneous 
edible preparations (HS Chapters 17-18 and 20-21 respectively), the status of originating good is 
obtained when: (i) each of the non-originating materials used in the production of the good undergoes an applicable change in tariff classification at the Chapter (HS 2-digit), heading 
(HS 4-digit) or sub-heading (HS-6 digit) levels as a result of production occurring entirely in the 
                                               
12 As detailed in Article 4.14. 
13 A "new and different article of commerce" means a good that has been substantially transformed 
from a good or material that is not wholly the growth, product, or manufacture of one of both of the Parties 
and that has a new name, character, or use distinct from the good or material from which it was transformed 
(Article 4.2). 
14 Indirect materials are detailed in Article 4.14. WT/REG219/2/Rev.1 
 
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  territory of one or both of the Parties, or (ii)  if the good otherwise satisfies the applicable 
requirements of Annex 4-A where a change in tariff classification for each non-originating material is not specified; and (iii) the good satisfies other applicable requirements of the Chapter on rules of origin.  
3.1.6  Export duties and charges,  and quantitative restrictions 
3.31.  As noted, Article 2.8 prohibits the Parties from adopting any prohibition or restriction on 
imports and export of any goods except in acco rdance with Article XI of the GATT 1994 and its 
interpretative notes. Article 2.10 further prohibits the adoption or maintenance of any tax, duty, or 
other charge on the export of any good to the te rritory of other Party, unless the tax, duty, or 
charge is also adopted or maintained on the good when destined for domestic consumption. Export subsidies on agricultural products are dealt with in Article 2.11. 
3.2  Regulatory provisions on trade in goods 
3.2.1  Standards 3.2.1.1  Sanitary and phytosanitary measures 
3.32.  The Parties reaffirm their existing rights and obligations under the WTO Agreement on 
Sanitary and Phytosanitary Measures (SPS) (Article 6.3.3). Any SPS matter can be addressed through the Joint Committee established under Ar ticle 18.2 of the Agreement or a subcommittee 
(Article 6.3.2), but not through the Agreement's dispute settlement mechanism (Article 6.3.3). 
3.2.1.2  Technical barriers to trade 3.33.  Chapter 7 on Technical Barriers to Trade (TBT) applies to all standards, technical 
regulations, and conformity assessment procedures of the central level of government that may 
directly or indirectly affect the Parties' mutual trade except for technical specifications prepared by 
governmental bodies for their production or consumption and SPS measures as defined in Annex A of the WTO Agreement on SPS. The Parties reaffirm  their existing rights and obligations under the 
WTO Agreement on TBT. In determining whether an international standard, guide, or 
recommendation exists within the meaning of Arti cles 2 and 5 and Annex 3 of the TBT Agreement, 
the Parties agree to apply the principles set out in Decisions and Recommendations adopted by the 
WTO's TBT Committee since 1 January 1995. 
3.34.  With regard to conformity assessment procedures (Article 7.5) the Agreement recognizes a 
number of options for the parties to accept each others' procedures including: recognizing the results of conformity assessment by the other Pa rty; voluntary arrangements between conformity 
assessment bodies to accept each others' assessments; adoption of accreditation procedures for 
qualifying conformity assessment bodies in the ot her Party; designation of conformity assessment 
bodies in the other Party; and relying on the supplier's declaration of conformity. The Parties are 
to intensify discussions on the use of such option s. The Agreement also requires that each Party 
accredits, approves, licences or otherwise recogn izes a conformity assessment body in the other 
Party on terms no less favourable than it accords to its own conformity assessment bodies. If this 
is not the case, the Party shall, on the request of the other Party, explain the reason for its 
decision. When a Party does not accept either the results, accreditation, approval, licence, or recognition by the other Party's assessing conformity body, or a request from the other Party for negotiations or conclusion of an agreement on facilitating recognition, it must explain the reasons 
for its decision, upon the other Party's request.  
3.35.  To enhance transparency, the Parties agree to allow each others' persons on terms no less 
favourable than to their own persons, including non-governmental standardizing bodies, to 
participate and comment on the development of standards, technical regulations and conformity 
assessment procedures (Article 7.6). In order to facilitate this, each Party publishing a notice in accordance with Articles 2.9 or 5.6 of the TBT Ag reement (non-existence of relevant international 
standards), must include details of the objectives of the proposed technical standard or conformity 
assessment procedure, and the rationale for its approach. The information must be transmitted 
electronically to the other Party through its established enquiry point, at the same time as it notifies WTO Members, and publish its responses to any comments it receives no later than the WT/REG219/2/Rev.1 
 
- 19 - 
 
  date on which it publishes the new standard or procedure. Bahrain indicates that such steps have 
been taken and notifications are made at the same time as notification to the WTO.  
3.36.  Transparency is also to be enhanced thro ugh joint work on standards, technical regulations 
and conformity assessment procedures with a view to facilitating access to each others' markets. 
In particular, the Parties will try to identify trade facilitating bilateral initiatives in this area that are 
appropriate for certain issues or sectors, such as aligning national with international standards (Article 7.4). The Agreement establishes Coordinators, the United States Trade Representative for 
the United States and the Ministry of Commerce for Bahrain, to inter alia  monitor the 
implementation and administration of the TBT Chapter, enhance and facilitate cooperation in the development of standards and conformity assessmen t, including any sector-specific proposals, and 
for consultations on any matter arising under the Chapter (Article 7.7.1.(e)). 
3.2.2  Safeguard mechanisms 
3.2.2.1  Global safeguards 3.37.  The Parties retain their rights and obligations under Article XIX of GATT 1994 and the WTO 
Agreement on Safeguards. If a Party takes measures under those provisions, such measures will 
not confer any additional rights or obligations on the other Party (Article 8.4).  
3.2.2.2  Bilateral safeguards 
3.38.  As a result of the reduction or elimination of customs duties under the Agreement, if a good 
originating in one Party is imported by the other Party: (i) in such increased quantities, in absolute terms or relative to domestic production, and (ii) under such conditions that the imports constitute "substantial" cause of serious injury, or threat th ereof, to a domestic industry of the importing 
Party which produces a like or directly competit ive good, then the importing Party may apply a 
bilateral safeguard measure (Article 8.1), to the extent and for such time as may be necessary to prevent or remedy serious injury and to facilitate adjustment (Article 8.2.4.(a)).
15 
3.39.  Bilateral safeguards may take the form of: (i) suspension of the further reduction of 
customs duty on the good; or (ii) increased custom s duty up to the lesser of the applied MFN duty 
when the safeguard is taken and on the day immediately preceding the date of entry into force of 
the Agreement (Article 8.1). 
3.40.  A Party initiating an investigation, must notify, and consult with, the other Party as far in 
advance as practicable before applying a measure (Article 8.2.1). The Agreement incorporates the investigation procedures mutatis mutandis in Articles 3, 4.2(a), and 4.2(c) of the WTO Agreement 
on Safeguards (Articles 8.2.2 and 8.2.3). 
3.41.  Bilateral safeguards may not be imposed for more than three years (Article 8.2.4.(b)) 
(as compared to four years in the WTO Agreement on Safeguards) nor more than once against the 
same good (Article 8.2.5). If the expected durati on of the measure is longer than one year, the 
importing Party shall progressively liberalize it at regular intervals (Article 8.2.6). In addition, safeguard measures cannot be taken after a tran sitional period of 10 years except with the 
consent of the other Party (Articles 8.4.(c) and 8.5). 
3.42.  Compensation for the measures shall be given to the exporting Party in the form of 
concessions having substantially equivalent trade effects or equivalent to the value of the additional duties expected from the measure. If  an agreement on compensation cannot be reached 
within 30 days from the date the importing Party announces a decision to apply the measure, then 
the exporting Party can take a counter-tariff action, for the minimum period necessary and during the period of the applied measure (Article 8.3). 
                                               
15 Under Article 8.5, the Agreement follows the definiti on of "domestic industry", "serious injury", and 
"threat of serious injury" as in Article 4 of the WTO Agreement on Safeguards. In addition, the Agreement defines "substantial cause" as "a cause that is  important and not less than any other cause". WT/REG219/2/Rev.1 
 
- 20 - 
 
  3.43.  Once the safeguard measure has been term inated, the rate of customs duty must be the 
same as that agreed to in the Party's schedule of concessions. The Agreement does not contain a possibility of imposing provisional measures.  
3.2.2.3  Special safeguards 
3.44.  Emergency bilateral safeguard action is permitted under Chapter 3 on Textiles and Clothing 
if textiles and clothing products subject to libera lization under the Agreement are imported in such 
increased quantities as to cause or threaten to cause serious damage to a domestic industry 
producing like or directly competitive goods (Section C below). 
3.45.  In its tariff schedule (paragraph 5), the United States committed to exempt originating 
goods imported into its territory from any duties applied pursuant to Article 5 of the WTO Agreement on Agriculture. 
3.2.3  Anti-dumping and countervailing measures 
3.46.  The Agreement contains no specific provis ion on anti-dumping and countervailing measures. 
3.2.4  Subsidies and State-aid 
3.47.  Article 2.11 prohibits export subsidies on any agricultural products in trade between the 
Parties. However, where an exporting Party consider s that a non-Party is exporting an agricultural 
good to the territory of the other Party with the benefit of export subsidies, the importing Party 
shall, on written request of the exporting Party, consult with the exporting Party with a view to 
agreeing on specific measures that the importing Party may adopt to counter the effect of such subsidized imports. If the importing Party adop ts the agreed-on measures, the exporting Party 
shall refrain from applying any export subsidy to  exports of such good to the territory of the 
importing Party. The Agreement contains no specific provisions on state-aid. 
3.2.5  Customs-related procedures 3.48.  Chapter 5 on customs administration requires the Parties to publish their laws, regulations 
and administrative procedures on the Internet and to designate one or more enquiry points to 
address inquiries from interested persons (Article 5.1). In addition, the Parties will, to the extent 
possible, publish in advance any regulations of general application on customs matters that they 
propose to adopt and provide an opportunity for interested persons to comment on the proposals.  
3.49.  The Parties will adopt simplified customs procedures to provide for the release of goods by 
customs, to the extent possible, within 48 hour s of arrival and without interim transfers to 
warehouses. To facilitate customs procedures, the Parties shall endeavour to use information 
technology that expedites procedures for import, an d in deciding the information technology to be 
used for such procedures, take into account international standards (Article 5.3), and to adopt or maintain risk management systems to concentrate inspection activities on high-risk goods and 
simplify clearance of low-risk goods (Article 5.4). The Parties shall also adopt or maintain 
procedures for express shipments (Article 5.7). To this end, they shall cooperate in achieving compliance with their respective domestic laws and regulations in implementing the provisions of 
the Agreement relating to trade in goods (including the provisions on rules of origin), the 
Agreement on Customs Valuation and any other matters on imports and exports as agreed to by the Parties (Article 5.5).  
3.50.  Each Party may also request the other Party to provide confidential information that 
pertains to that activity and that is normally collected by the other Party in connection with the 
import of goods when it has "reasonable suspicion of unlawful activity"
16 relating to rules 
                                               
16 As specified in Article 5.5.5 "reasonable suspicio n on unlawful activity" means a suspicion based on 
relevant factual information obtained from public or private sources, including historical evidence that (a) a specific importer, exporter, producer , or other enterprise involved in the movement of goods between the 
Parties' territories has not complied with a Party's laws or regulations governing importation or (b) some or all 
of the enterprises involved in the movement of goods with in a specific product sector have not complied with a 
Party's laws or regulations governing im portation; or other information that th e Parties agree is sufficient in the 
context of a particular request. WT/REG219/2/Rev.1 
 
- 21 - 
 
  governing importation; the requested Party shall respond by providing any information that it has 
collected that is material to the request, provided that the confidentiality of information shall be maintained in accordance with Article 5.6. Each Party shall also ensure access to review and appeal procedures by the importer with regard to a determination on customs matters 
(Article 5.8).  
3.51.  The customs authorities of each Party must also provide written advance rulings prior to 
import, at the request of an importer, exporter or producer in the other Party, on matters relating 
to inter alia  tariff classification, customs valuation criteria, duty drawback, and qualification of the 
good as originating. The advance rulings, which are valid for three years unless there is a change in facts or circumstances on which the ruling was based, must be issued within 150 days of a request, provided that the requester has submitted all the necessary information (Article 5.10). 
The advance ruling requirement applies to Bahrain as of two years from implementation of the 
Agreement (Article 5.10.9).  
3.3  Sector-specific provisions on trade in goods 
3.3.1  Textiles and clothing 
3.52.  Chapter 3 contains provisions on emergency safeguards and specific rules of origin for 
textiles and clothing products. 
3.3.1.1  Emergency safeguards 
3.53.  When a textile or apparel good benefiting from preferential tariff treatment under the 
Agreement is being imported into the territory of a Party in such increased quantities, in absolute terms or relative to the domestic market for that good, and under such conditions as to cause 
serious damage, or actual threat thereof, to a domestic industry producing a like or directly 
competitive good, the affected Party may take emergency action, consisting of an increase in the rate of duty on the good to a level not to exc eed the lesser of: (a) the MFN applied duty at the 
time the action is taken; and (b) the MFN duty in effect on the date of entry into force of the 
Agreement (Article 3.1).  
3.54.  A Party shall determine the "serious damage", or actual threat thereof: (a) by examining 
the effect of increased imports on the particular industry, as reflected in changes in relevant 
economic variables such as, output, productivity, ut ilization of capacity, inventories, market share, 
exports, wages, employment, domestic prices, profits, and investment, none of which shall 
necessarily be decisive; and (b) by not considerin g changes in technology or consumer preference 
as factors supporting a determination of serious damage or actual threat thereof.  
3.55.  Emergency actions may not be maintained for a period exceeding three years; shall not be 
taken against a good beyond ten years after which the Party must eliminate customs duties on 
that good; shall not be taken more than once against the same good; and shall, on termination of 
the emergency action, apply to the good that was subject to the emergency action, the rate of duty that would have been in effect but for the action.  
3.56.  Any Party may take such emergency measures only after notification, in writing, to the 
other Party and only following an investigation by its competent authorities. On the request of the exporting Party, the importing Party shall enter into consultations regarding the matter.  
3.57.  The importing Party must provide the exporting Party with "mutually agreed trade 
liberalization compensation", in the form of concessions having substantially equivalent trade 
effects or equivalent to the value of the addition al duties expected to result from the emergency 
action. If the Parties do not agree on the compensation, the exporting Party may suspend tariff 
concessions having equivalent effect on bilate ral trade of the emergency action. Compensation 
shall be limited to textiles and apparel goods, unless the Parties agree otherwise, while suspension of tariff concessions may be taken against any good from the importing Party.  
3.58.  The Parties maintain the right to adop t safeguard measures in accordance with the 
WTO Agreement on Textiles and Clothing or the WTO Safeguard Agreement. However, if a good is WT/REG219/2/Rev.1 
 
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  subject to any of these WTO provisions, it ca nnot be subject to emergency action under the 
Agreement.  
3.3.1.2  Specific Rules of Origin 3.59.  Article 3.2.1 specifies that, in principle, the rules of origin provided for under Chapter 4 
apply to textile and apparel products, except as provided in Chapter 3 and its annex. However, 
upon request by either Party, the Parties shall consult to consider whether the rules of origin 
applicable to a specific textile or apparel good should be revised to address the issue of availability 
of supply of fibres, yarn, or fabrics in the territory of any of the Parties (Article 3.2.3). To this end, 
each Party shall provide the other with data that demonstrate "substantial production" in its territory of a particular fibre, yarn or fabric. "Substantial production" occurs when domestic producers of a Party are capable of supplying commerc ial quantities of fibre, yarn or fabric in a 
timely manner (Article 3.2.4). Consultations shall be concluded within 60 days after the 
submission of the request, and where the Parties agree to revise a rule of origin, the Agreement 
shall be amended according to the procedures described in Article 21.2 (Amendments).  
3.60.  A de minimis  clause applies to textiles or apparel goods considered to be not originating 
because certain fibres or yarns used in the production of its component that determines the tariff classification do not undergo a change in tariff classification, but the total weight of such fibres 
or yarns in that component does not exceed 7% of the total weight of that component 
(Article 3.2.6). This exception does not apply to elastomeric yarns.  
3.61.  Article 3.2.7 extends the status of originating good to textiles or apparel goods put up in 
sets for retail (in accordance with the General Rule  of Interpretation 3 of the HS) when each of 
them individually is an originating good or the total value of non-originating goods in the set does 
not exceed 10% of the value of the set.  
3.62.  In addition, preferential tariff treatment up to an annual limit of 65 millions square metres 
equivalent between 2006 and 2015 shall be granted to the following non-originating products, 
provided that they meet the applicable conditio ns for preferential treatment under the Agreement 
other than being an originating good:  
a. cotton or man-made fibre fabric goods in HS Chapters 52, 54, 55, 58, and 60 that are 
wholly formed in a Party's territory from yarn produced or obtained outside its territory; 
b. cotton or man-made fibre fabric goods in Annex 3-B
17 that are wholly formed in a Party's 
territory from yarn spun in its territory from fibre produced or obtained outside its 
territory;  
c. cotton or man-made fibre apparel goods in HS Chapters 61 or 62 that are cut or knit to 
shape, or both, and sewn or otherwise assembled in a Party's territory from fabric or 
yarn produced or obtained outside its territory; and  
d. cotton or man-made fibre made-up goods provided for in HS Chapter 63 that are cut or 
knit to shape, or both, and sewn or otherwis e assembled in a Party's territory from fabric 
wholly formed in a Party from yarn produced or obtained outside its territory.  
3.63.  Upon request by the exporting Party, the im porting Party shall allocate this quantity among 
the four categories in accordance with the request (Article 3.3.9).18 The exporting Party may 
request the importing Party to provide to an import er claiming preferential treatment, a certificate 
of eligibility, which must be properly completed and signed by an authorized official of the 
exporting Party.  
3.64.  Product specific rules of origin are provided in Annex 3-A for textiles and clothing products 
in HS Chapters 42, 50-63, 70 and 94. According to Article 1 of the Annex, a good is considered to 
                                               
17 Annex 3-B applies to cotton products in Chapte r 58 (45 lines) and to cotton and man-made fibre 
products in Chapter 60 (36 lines). 
18 To determine the quantity in square metres, the importing Party shall apply the "Textile Correlation of 
the US. Textiles and Apparel Category System with the Harmonized Tariff Schedule of the United States of America". WT/REG219/2/Rev.1 
 
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  be originating if (i) each of the non-originating materials used in its production in the territory of 
one or both of the Parties undergoes an applicable  change in tariff classification at the heading 
(HS 4 digit) or sub-heading (HS 6-digit) levels, or  the good otherwise satisfies the requirements of 
the Chapter where a change in tariff classification  is not required; and (ii) the good satisfies any 
other requirements on rules of origin under the Agreement.  
3.65.  Under Article 3.3, the Parties commit to cooperate to enforce measures affecting trade in 
textiles and apparel products, including those implementing international agreements, to verify the 
accuracy of claims of origin and to prevent ci rcumvention of any agreements. The exporting Party 
may verify the accuracy of claims of origin upon the request of the importing Party, regardless of whether an importer claims preferential treatment for the good, or on its own initiative (Article 3.3.2). When the importing Party has a reasonable suspicion of unlawful activity relating to 
trade in textiles and apparel products, it may request the exporting Party to verify compliance by 
the exporter or producer with applicable custom s measures (Article 3.3.3). The importing Party 
may assist in the verification process, including through visits to the exporting Party's territory. In 
case of refusal by the exporter, producer or enterprise, to consent to the visit, the importing Party 
may take appropriate actions including denying preferential tariff treatment to any textiles or apparel products exported or produced by the person subject to verification (Article 3.3.8). 
Appropriate measures may also be adopted when the importing Party (a) is unable to determine 
the accuracy of claims of origin or the existence of unlawful activities within 12 months after its request for verification, or (b) makes a negative determination, provided that the other Party has been notified of its intention to do so. Furthermore, the importing Party may suspend the 
application of preferential tariff treatment to the textiles and apparel product which is subject to 
verification. 
4  TRADE IN SERVICES  
4.1  Scope and definitions 
4.1.  Chapter 10 sets out the provisions governing cross-border trade in services. It applies to 
measures adopted or maintained by the Parties at the central, regional or local levels; or by 
non-governmental bodies in the exercise of powers delegated by central, regional or local 
governments or authorities (Article 10.1.2). The provisions of Chapter 10 do not apply to: financial services - except that disciplines on market access, domestic regulation, and transparency which apply where the service is supplied through an investment under the Bilateral Investment Treaty 
(BIT) (except a BIT investment in a financial institution) in a Party's territory; air services, 
including domestic and international air transportation services, whether scheduled or non-scheduled, and related services in support of air services, other than aircraft repair and 
maintenance services during which an aircraft is withdrawn from service and specialty air services; 
government procurement; and subsidies or grants provided by a Party, including government-supported loans, guarantees, and insurance (Article 10.4). Government procurement 
and financial services are addressed, respectively, in Chapters 9 and 11 of the Agreement.  
4.2.  Cross-border trade in services under Chapte r 10 covers the supply of services akin to GATS 
modes 1 (cross-border supply), 2 (consumption abro ad), and 4 (presence of natural persons). The 
supply of a service in the territory of a Party through a BIT investment (see below) (Mode 3), is 
exempted. However, pursuant to Article 10.1.3, provisions on market access (Article 10.4), 
domestic regulations (Article 10.7), and transparency (Article 10.8) apply to "measures of a Party affecting the supply of a service in its territory by a BIT investment". The Agreement does not 
contain a chapter on investment. Articles 10.4, 10.7 and 10.8 apply also to the establishment 
phase. 
4.3.  Under Article 1.3 of the Agreement, a "BIT investment"  means "covered investment" as 
defined in Article 1(e) of the Treaty Between the Government of the United States of America and 
the Government of the Kingdom of Bahrain Concerning the Encouragement and Reciprocal Protection of Investment, signed at Washington on 29 September 1999 and entered into force on 31 May 2001.
19 In the BIT, a "covered investment" is defined as investment of a national20 or a 
                                               
19 http://tcc.export.gov/Trade_Agreements/All_Trade_Agreements/exp_002777.asp  
20 "National" is defined as a "natural person who is national of a Party under its own laws" (Article 1(c) 
of the BIT). WT/REG219/2/Rev.1 
 
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  company of a Party21 in the territory of the other Party (Article 1 (e) of the BIT). An investment 
owned or controlled directly or indirectly by a national or a company from the other Party includes, but is not limited to, a company, shares, stocks and other forms of participation, contractual rights, moveable and immovable property and intellectual property rights (Article 1 of the BIT).  
According to the Parties, these terms are not defi ned in the BIT. The BIT grants national and MFN 
treatment to covered investments, with respec t to establishment, acquisition, expansion, 
management, conduct, operation and sale or other dispositions (Article 2). A Party may adopt or 
maintain exceptions to national and MFN treatment obligations. The Annex to the BIT lists the 
sectors or matters where the Parties reserve the right to adopt or maintain exceptions to these obligations as shown in Table 4.1 below. The obligation to grant market access under the Agreement (Article 10.4) applies also to investment in sectors subject to national treatment 
exceptions under the BIT except in cases where th ose measures fall also under the market access 
definitions or under the market access measure.  
Table 4.1 Exceptions to National and MFN treatment with respect to covered 
investments under the BIT 
United States 
Exceptions for existing and future measures Sectors 
National treatment Atomic energy; customhouse brokers; licenses for 
broadcasts by common carrier, or aeronautical radio 
stations; the Communications Satellite Corporation 
(COMSAT) ; subsidies or grants, including but not limited 
to, government-supported loans, guarantees or insurance; 
state and local measures exempt from Article 1102 of the 
NAFTA; landing of submarine cables. 
National and MFN treatment Fisheries; air and maritime transport and related 
activities; banking, insurance, securities and other 
financial services; one-way satellite transmissions of direct-to-home (DTH) and dire ct broadcast satellite (DBS) 
television services and of digital audio services 
Bahrain 
Exceptions for existing and future measures Sectors 
National treatment Ownership or control of television and radio broadcasting 
and other forms of mass media; fisheries; initial 
privatization of exploration or drilling for crude oil. 
National and MFN treatment Air transportati on; purchase or ownership of land; and 
until 1 January 2005, purchase or ownership of shares quoted on the Bahrain Stock Exchange. 
Source: The Bilateral Investment Treaty between the United States and Bahrain. 
4.4.  The BIT also contains disciplines on expropriation (Article 3), compensation for damages due 
to war or similar events (Article 4), transfers (Article 5), prohibition of performance requirements (Article 6), and rules for entry, sojourn and employ ment of nationals of the other Party (Article 7). 
Benefits under the BIT may be denied if nationals of a third country own or control the company of 
a Party and the denying Party does not maintain "normal economic relations" with the third country; or the company does not have substantial business activities in the territory of the Party 
under whose laws it is constituted or organized (Article 12). Dispute settlement provisions are 
addressed under Articles 8-11. Article 13 excludes tax matters from the scope of the BIT; the Parties maintain the right to adopt measures necessary for respecting their security 
interests (Article 14). 
4.5.  General definitions on trade in services under Chapter 10 are contained in Article 10.13. 
"Enterprise of a Party"  means an enterprise organized or constituted under the laws of a Party; 
and a branch located in the territory of a Party and carrying out business activities there; while, 
"service supplier" means a person that seeks to supply or supplies a service.
22  
                                               
21 "Company" is broadly defined as "a ll types of legal entities constitu ted or organized under applicable 
law and includes: corporations, trusts, partnership, sole proprietorship, branches, joint venture, and 
associations, but it explicitly excludes non-profit entities  as well as entities that are owned or controlled by the 
state" (Article 1(a)). "Company of a Party" is defined as a "company constituted or organized under the law of 
that Party" (Article 1(b) of the BIT). 
22 The Parties understand that for the purposes of Articles 10.2 and 10.3, "service suppliers" has the 
same meaning as "services and service suppliers" as used in Articles II and XVII of GATS. WT/REG219/2/Rev.1 
 
- 25 - 
 
  4.6.  Chapter 10 is accompanied by two Side Letters between the Parties on gambling and 
immigration, dated 14 September 2004. As far as gambling is concerned, the Parties confirmed their understanding that, the objectives of prot ecting public morals, preventing fraud, and 
deterring crime underlie much regulation of gambling and betting services at the central and 
regional levels, and that, in Bahrain all gambling and the provision of gambling services is 
prohibited and treated as a criminal offence. The Side Letter indicates that the Parties confirm their understanding that regulation of gambling and betting services at the central and regional levels 
would generally fall within the exceptions under GATS Article XIV, as incorporated into the 
Agreement. With respect to immigration, the Parties agree that no provision in the Agreement shall be construed as imposing any obligation regarding their measures concerning immigration (including with respect to visas) or, except as provided in the Chapter on Labour, the right to 
secure employment in their respective territories.  
4.2  Denial of benefits 4.7.  A Party may deny the benefits of the Chapter on cross-border trade in services to a service 
supplier of the other Party if the service is being supplied by an enterprise owned or controlled by 
persons of a non-Party, and the denying Party: (a) does not maintain diplomatic relations with the non-Party; or (b) adopts or maintains measures with respect to the non-Party or a person of the 
non-Party that prohibit transactions with the enterprise or that would be violated or circumvented 
if the benefits of the Chapter were accorded to the enterprise. Subject to consultations, a 
Party may also deny the benefits of the Chapter to a service supplier of the other Party if the service is being supplied by an enterprise that has no substantial business activities in the territory 
of the other Party and persons of a non-Party, or of the denying Party, own or control the 
enterprise (Article 10.11).  
4.3  General provisions on trade in services 
4.3.1  Market access 
4.8.  The Parties are prevented from adopting or maintaining, either at the regional or central 
level, measures that (a) constitute limitations on the number of service suppliers, the total value 
of service transactions or assets, the total number of service operations or the total quantity of 
services output, and the total number of natural persons that may be employed in a particular service sector; or (b) restrict or require specific types of legal entities or joint ventures through which a service supplier may supply a service (Article 10.4). This provision, like those of national 
and MFN treatment and local presence, is subject to reservations under Annexes 1 and 2. 
4.3.2  National and MFN treatment 4.9.  According to Articles 10.2 and 10.3, each Part y shall accord to services suppliers of the other 
Party treatment no less favourable than that accorded, in like circumstances, to its own service 
suppliers and to services suppliers of a non-party.  With respect to a regional level of government, 
national treatment means that each Party shall accord treatment no less favourable than the most 
favourable treatment accorded, in like circumstances, by that regional level of government to 
service suppliers of the Party of which it forms a part (Article 10.2.2).  
4.3.3  Local presence 4.10.  Neither Party may require a service supplier of the other Party to establish or maintain a 
representative office or any form of enterprise, or to be resident, in its territory as a condition for 
the cross-border supply of a service (Article 10.5).  
4.3.4  Movement of natural persons 
4.11.  The Agreement does not contain a separate chapter on movement of natural persons. The 
Side Letter on immigration clarifies that the Agreement's provisions place no obligations on the Parties with regard to their immigration or entry measures or the right to employment. WT/REG219/2/Rev.1 
 
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  4.4  Liberalization commitments/non-conforming measures 
4.12.  The Agreement follows a "negative-list appr oach" with all sectors and sub-sectors assumed 
to be covered by the Chapter's obligations, unless as specified in the Parties' Schedules. The Schedules to Annex I list any existing measures maintained at central, regional or local levels, that 
do not conform with Articles 10.2 (National Treatment), 10.3 (Most-Favoured-Nation Treatment), 
10.4 (Market Access) and 10.5 (Local Presence). In addition, these provisions do not apply to any 
future measures that a Party may adopt or maintain with respect to sectors, sub-sectors and 
activities listed in their Schedules to Annex II. Reservations to certain obligations of the Chapter 
on financial services are listed in the Parties' Schedules to Annex III (see Section 6(b) of this presentation).  
4.13.  A comparison between the Parties' liberalization commitments under the Agreement and 
their respective GATS schedules are presented in Tables 4.2 and 4.3 (the United States) and 4.4 
and 4.5 (Bahrain). This comparison has been dr awn up based on the Parties' non-conforming 
measures in Annexes I-III which are also summarized in tables below.  
4.4.1  The United States 
4.14.  The United States has improved a number of its liberalization commitments under the 
Agreement compared to its GATS Schedule of Commitments. Under Annex II of the Agreement, 
and with respect to Article 10.4 of the Agreement (market access), the United States reserves the 
right to adopt or maintain any measure that is not inconsistent with its obligations under Article XVI of the GATS. In the maritime tran sportation sector, for which it has made no 
commitments under the GATS, the United States has granted, subject to specific conditions, 
market access to suppliers from Bahrain. 
4.15.  Table 4.2 shows the United States' reservations for existing non-conforming measures at 
the central and regional levels (Annex I). These often relate to residency and nationality 
requirements. Under Annex I, the United States reserves the right to maintain all existing 
non-conforming measures of all the states of th e United States, the District of Columbia, and 
Puerto Rico. 
Table 4.2 Non-conforming measures listed by the United States in Annex I  
Sector Reservation Mode Description 
Business services - 
export conduct NT/LP CBTS Only a "person" who is a resident can apply for a certificate of 
review of export conduct. A foreign national or enterprise may 
receive the protection under a certificate of review by becoming a "member" (partnership or joint venture; a shareholder of a corporation; or a participant in an association, cooperative, or othe r form of profit or non-profit 
organization or relationsh ip, by contract or other 
arrangement) of a qualified applicant. 
Business services - 
export of controlled 
products NT/LP CBTS Residency requirements to apply for a licence.  
Air transport  NT/MFN/LP CBTS Authorizat ion/Nationality and other requirements 
Transportation services- 
Customs brokers NT/LP CBTS License/Nationality requirements 
Professional services- 
Practice before the 
Patent and Trademark 
Office NT/MFN/LP CBTS Nationality/ reside ncy and reciprocity requirements 
All sectors NT/MFN/LP CBTS All existing non-conforming measures at regional level 
Note:  CBTS: Cross-border trade in services; LP: Lo cal presence; MA: Market Access; MFN: Most-Favoured 
Nation treatment; NT: National Treatment. 
Source: The Free Trade Agreement between the United States and the Kingdom of Bahrain, Annex I. 
 WT/REG219/2/Rev.1 
 
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  4.16.  In its Schedule to Annex II, the United States lists its reservations for areas where it may 
adopt or maintain non-conforming measures (Table 4.3). With respect to Article 10.4 of the Agreement (market access), the United States reserves the right to adopt or maintain any measure that is not otherwise inconsistent with its market access obligations under Article XVI of 
the GATS. If Bahrain believes that such a nonconforming measure would materially affect its 
interests under the Agreement, it may request consultations.  The United States agrees to engage in such consultations and to give due consideration to Bahrain's views in this respect. 
Table 4.3 Non-conforming measures listed by the United States in Annex II
 
Sector Reservation Mode Description 
Communications MFN CBTS Differential treatment under reciprocity measures or international 
agreement in specific sectors (DTH and DBS television services 
and digital audio services) 
Social services NT/MFN/LP CBTS Measures on law enforcement and correctional services and 
specific services to the extent they are social services established 
or maintained for a public purposea 
Minority affairs NT/LP CBTS Measure according rights or preferences to socially or 
economically disadvantaged minorities, including corporations 
organized under the laws of the State of Alaska 
Transportation NT/MFN/LP CBTS Measures relating to maritime transportation 
All MA CBTS Any measures not inconsistent with market access obligations 
under the Uruguay Round Agreements . Possibility of consultation 
All MFN CBTS Reservation of according differential treatment under any bilateral 
or multilateral agreement prior to the entry into force of the 
Agreement, or after entry into force in the following sectors: 
aviation, fisheries and maritime matters (including salvage) 
a The specific sectors are income security or insuranc e, social security or insurance, social welfare, 
public education, public training, health and childcare. 
Note:  CBTS: Cross-border trade in services; LP: Local presence; MA: Market Access; MFN: 
Most-Favoured-Nation; NT: National Treatment. 
Source: The Free Trade Agreement between the United States and the Kingdom of Bahrain, Annex II. 
4.4.2  Bahrain 
4.17.  Bahrain's commitments under the Agreement go significantly beyond its GATS commitments 
which were limited to financial services. New liberalization commitments have been taken in all sectors with improved market access conditions being granted in financial services. 
4.18.  Under the Agreement, all existing non-conf orming measures maintained by Bahrain at the 
central and regional levels are listed in its Schedule to Annex I (Table 4.4). In selected sectors, Bahrain agrees to phase-out a requirement to maintain a place of business in Bahrain to supply services through the presence of natural persons.  The requirements are to be phased out within 
three
 years from the entry into force of the Agreement (i.e. 2008) for advertising, car rental, 
consultancy and management, debt collection, transportation and travel agency, tour operators and tourist guide services; and within seven years from the date of the signature of the Agreement 
(i.e. 2012) for accounting, financial auditing and bookkeeping services; architectural and 
engineering services; services incidental to mining; and construction and construction related services. These non-conforming measures cannot be construed to permit Bahrain to prohibit the 
cross border supply of services (Annex I). Notwit hstanding the local presence requirement, each 
US supplier of certain professional services, who is licensed and authorized in the United States to 
supply that service, may apply for up to three temporary licences to supply these services through the presence of natural persons in Bahrain without having to maintain a place of business in 
Bahrain. Each license shall be for an initial period of 12 months, renewable for another 12 months, 
and be granted in accordance with Article 10.7 of the Agreement (domestic regulation). 
4.19.  Furthermore Bahrain committed to phase-out existing non-conforming measures within 
5 years from the date of the Agreement's entr y into force (i.e. 2010) on the provision of 
advertising and publishing services by US suppliers in the territory of Bahrain. Where applicable, nationality includes citizens of Bahrain or of the Gulf Cooperation Council (GCC) Member States, WT/REG219/2/Rev.1 
 
- 28 - 
 
  except for: publishing of local newspapers; pilotage services; and Islamic pilgrimage services, 
which can only be supplied by Bahraini citizens who are resident in Bahrain. Bahrain has scheduled market access reservations in the energy sector  for the wholesale distribution of petroleum 
products, which is reserved for Bahrain's state-owned company; for water distribution services 
through pipelines; and for electricity distribution and transmission services, which are reserved for 
the Government.  
Table 4.4 Non-conforming measures  listed by Bahrain in Annex I 
Sector Reservation Mode Description Phase-out 
period 
Certain sectorsª LP CBTS Natural person needs to maintain a place of 
business in Bahrain 3/7 
years 
Legal services NT/MFN CBTS Nationality requirement*/Employment in a 
legal entity with license  n.a. 
Advertising-Public transmission of advertising NT/MFN CBTS Establishment of a branch office or 100% 
foreign owned company, must be managed by Bahraini citizens who are permanent residents.  5 years 
Publishing - Local 
newspaper and 
periodicals NT CBTS Nationality requirement n.a. 
Publishing NT/MFN CBTS Establishment of a branch office or 100% 
foreign owned company, must be managed by Bahraini citizens who are permanent residents. 5 years 
Freight and cargo 
services MA CBTS Exclusive supplier/limited number of 
concessions for supply n.a. 
Customs clearance 
services NT/MFN CBTS Nationality requirement* n.a. 
Pilotage and berthing 
services NT CBTS Reserved for Bahraini-flagged vessels and 
nationals n.a. 
Coastal water 
transportation services NT CBTS Reserved for Bahraini-flagged vessels n.a. 
Energy services-
wholesale distribution of 
petroleum products MA CBTS Reserved for state-owned Bahrain Petroleum 
Company n.a. 
Energy services-Water 
distribution services MA CBTS Reserved for Government of Bahrain n.a. 
Energy services-
Electricity distribution 
services MA CBTS Reserved for Government of Bahrain n.a. 
Telecommunication 
services LP CBTS Where a license is required, the licence must 
be a juridical entity, or branch of foreign company incorporated or licensed to operate in Bahrain/local presence of substantially all infrastructure and personnel n.a. WT/REG219/2/Rev.1 
 
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  Sector Reservation Mode Description Phase-out 
period 
Telecommunication 
services MA CBTS Limitation on supply to two operators in 
mobile telephony until 31.12.05 n.a. 
Real estate services NT CBTS At least 51% of business's capital must be 
owned by a Bahraini partner; or 
establishment of a branch office n.a. 
Islamic pilgrimage 
services NT CBTS Nationality/Residency requirements  n.a. 
Note: CBTS: Cross-border trade in services; LP: Loca l presence; MA: Market Access; MFN: Most-Favoured-
Nation; NT: National Treatment. 
ª Accounting, Financial Auditing, Bookkeeping, and Related Services; Advertising Services; 
Architectural and Engineering Services; Car Rental  Services; Census, Market Research, and Public 
Opinion Polling; Construction Services and Co nstruction Related Services; Consultancy and 
Management Services; Debt Collection Services; Legal Services; Private Security Guard Services; Publishing and Printing; Real Estate Services; Services Incidental to Mining; Small Business 
Services; Terrestrial over the Air Radio, Television, and Satellite Transmission and Subscription Services in the Territory of Bahrain; Tourism – Hotel Operations and Management; Transportation 
Services; Travel Agency Tour Operators and To urist Guide Services; and Wholesale and Retail 
Services. 
* Nationality also includes GCC nationals n.a. Not applicable. Source: The Free Trade Agreement between the United States and the Kingdom of Bahrain, Annex I. 
4.20.  Under Annex 2, Bahrain reserves the right to maintain existing measures, or adopt new or 
more restrictive measures that do not conform to the Chapter's provisions on national and MFN 
treatment, market access or local presence (Table 4.5). Bahrain reserves the right during a 
transition period of two years to adopt or maintain measures in certain sectors with respect to cross-border supply that are inconsistent with the Chapter's market access obligation, provided 
these are in conformity with Bahrain's obligations under the GATS. The sectors concerned are: real 
estate services relating to owned or leased prop erty; car rental services; census, market research 
and public opinion polling services; debt collection services; employment and temporary personnel services; private security guard services; and co nstruction and construction related services. 
During this period, either Party may request consultations to decide whether, after the transition 
period, the measures in these sectors should be listed in Annex I, or these sectors should be listed in Annex II or deleted from Annex II. The consul tations shall be concluded within 60 days. Except 
as otherwise provided in the reservation, Bahrai n's market access reservations with respect to 
these sectors shall terminate at the end of the transition period.  WT/REG219/2/Rev.1 
 
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  Table 4.5 Non-conforming measures  listed by Bahrain in Annex II 
Sector Reservation Mode Description 
Services related to 
fisheries NT/MFN CBTS Rules and regulations relating to the operation and 
management of fisheries 
All MFN CBTS Differential treatment under any bilateral or multilateral 
agreement prior to the entry into force of the 
Agreement, and after its entry into force for aviation and 
maritime matters (including salvage) 
Social services  NT/MFN/ 
MA/LP CBTS Measures on law enforcement and correctional services 
and certain services to the extent they are established 
or maintained for a public purposea 
Communications MFN CBTS Differential treatment under reciprocity measures or 
international agreements in specific audio and video 
sectors 
Certain sectors MA CBTS Any measure relating to cross border supply of services 
for 2 years from the Agreement's entry into force 
subject to consultations 
Transport and 
communication- 
Postal services except 
express delivery services NT/MFN/LP CBTS Exclusive provision of postal services 
a The services are income security or insurance, social security or insurance, social welfare, public 
education, public training, health and child care. 
Note:  CBTS: Cross-border trade in services; LP: Lo cal presence; MA: Market Access; MFN: Most-Favoured-
Nation; NT: National Treatment. 
Source: The Free Trade Agreement between the United States and the Kingdom of Bahrain, Annex II. 
4.5  Regulatory provisions on trade in services 
4.5.1  Domestic regulation 
4.21.  Article 10.7 on domestic regulation requires that measures relating to qualification 
requirements and procedures, technical standards,  and licensing requirements are: (a) based on 
objective and transparent criteria, (b) not more bu rdensome than necessary to ensure the quality 
of the service; and (c) in the case of licensing procedures, not in themselves a restriction on the supply of the service. Where a Party requires auth orization for the supply of a service, the Party's 
competent authorities shall, within a reasonable period of time and without undue delay, inform 
the applicant of the decision concerning its applic ation. Article 10.7 does not apply to authorization 
requirements for sectors, sub-sectors or activities as set out in the Parties' Schedules to Annex II. If the results of negotiations on Article VI of the GATS or any similar negotiations in other 
multilateral fora in which both Parties participate, enter into effect for both Parties, the Parties 
agree to consult and coordinate to amend Arti cle 10.7 of the Agreement as appropriate. The 
Chapter also contains a provision on transparency in the development and application of 
regulations, including those establishing or applying to licensing authorization or criteria 
(Article 10.8).  
4.5.2  Recognition 4.22.  Article 10.9 contains provisions concerning the Parties' fulfilment of their standards or 
criteria for the authorization, licensing, or certification of services suppliers. Either Party may 
recognize the education or experience obtained, re quirements met, or licenses or certifications 
granted in a particular country, including the other Party and non-parties. Such recognition, which 
may be achieved through harmonization or othe rwise, may be based upon an agreement or 
arrangement with the country concerned or may be accorded autonomously. Where such recognition is granted, neither Party may accord it in a manner that would constitute a means of 
discrimination between countries in the application of its standards or criteria for authorization, 
licensing or certification of services suppliers or constitute a disguised restriction on trade in services. Where a Party recognizes autonomously or through an agreement or arrangement, the education or experience obtained, or licenses or certifications granted in the territory of a 
non-party, it shall not be required to accord such  recognition to the other Party. However, it shall WT/REG219/2/Rev.1 
 
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  afford adequate opportunity for the other Party, if  the other Party is interested, to negotiate its 
accession to such an agreement or arrangement; where it grants recognition autonomously, it shall afford adequate opportunity to the other Party to demonstrate that education, experiences, licenses or certifications obtained or requirements met in that other Party's territory should be 
similarly recognized.  
4.23.  Annex 10-B applies to standards and criteria for the licensing and certification of 
professional service suppliers. The Parties agre e to encourage the relevant bodies in their 
respective territories to develop mutually acceptable standards and criteria for licensing and 
certification of professional service suppliers and to provide recommendations on mutual recognition to the Joint Committee. The Joint Committee will review the recommendation within a reasonable period of time to ensure its consiste ncy with the Agreement. Following the review, and 
where appropriate, each Party will encourage its respective authorities to implement the 
recommendation within a mutually agreed time. In addition, where the Parties agree, each Party will encourage relevant bodies in its territory to develop procedures for the temporary licensing of 
professional services suppliers of the other Party. The Joint Committee must review the 
implementation of Annex 10-B at least once every three years. 
4.6  Commitments in selected services sectors  
4.6.1  Communication services 
4.6.1.1  Express delivery services 4.24.  For the purposes of the Agreement, expre ss delivery services are defined as the collection, 
transport and delivery of documents, printed matter, parcels, goods or other items on an 
expedited basis, while tracking and maintaining co ntrol of these items throughout the supply of the 
service. They do not include air transport se rvices, services supplied in the exercise of 
governmental authority, and maritime transport services and in the case of the United States, they 
also do not include delivery of letters subject to the Private Express Statutes but do include 
delivery of extremely urgent letters covered by ex ceptions to or suspensions to those Statutes.  
4.25.  Under the Agreement (Annex 10-A), the Parties endeavour to maintain at least the level of 
market access for express delivery services exis ting at the time the Agreement was signed. If a 
Party considers that the other is not maintaining this level of access it may request consultations. 
4.26.  In the GATS, Bahrain has no commitments in this sector, while the United States has 
inscribed land-based courier services in its GATS Schedule with no limitations on national 
treatment or market access in modes 1, 2, and 3 and its commitments under mode 4 are 
unbound. Under Annex II,  Bahrain reserves the right to adopt or maintain measures with respect 
to the exclusive provision of postal services, including conveying letters and postcards and the 
performance of all services incidental to receiving, collecting, dispatching, and delivering letters 
and postcards. This measure does not apply to express delivery services as defined in Annex 10-A of 
Chapter 10  and described above. 
4.27.  Where a Party's monopoly supplier of postal services competes, either directly or through an 
affiliated company, in the supply of express delivery services outside the scope of its monopoly rights, that Party shall ensure that the supplier does not abuse its monopoly position to act in its territory in a manner inconsistent with the Party's obligations under Articles 10.2 (national 
treatment), 10.3 (most-favoured-nation treatment), or 10.4 (market access) of Chapter 10. The 
Parties also reaffirm their obligations under Articl e VIII of the GATS and confirm that they have no 
intentions to direct revenues derived from the supply of postal monopoly services to confer an 
advantage to their own or any other compet itive supplier of express delivery services. 
4.6.1.2  Telecommunications services 4.28.  In comparison with its GATS commitments, the United States will not apply market access 
restrictions for suppliers from Bahrain. The only reservation listed by the United States in Annex
 II 
applies to MFN treatment due to the application of reciprocal measures or through international agreements involving sharing of radio spectrum , guaranteeing market access, or national 
treatment with respect to one-way satellite transmission of direct-to-home (DTH) and direct WT/REG219/2/Rev.1 
 
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  broadcasting satellite (DBS) television services and digital audio services. The same 
non-conforming measure may be taken by Bahr ain under its Schedule to Annex II. Other 
non-conforming measures listed by Bahrain in the Agreement include license requirements to supply telecommunication services in its territory and market access restrictions in the mobile 
telecommunications sector to two operators until 31 December 2005. Bahrain has not included 
telecommunications services in its GATS Schedule and the Agreement therefore implies significant liberalization by Bahrain in telecommunications services. 
4.29.  The Agreement contains a separate chapter on telecommunications (Chapter 12) which is 
modelled on the Reference Paper attached to the United States' GATS Schedule and deals with inter alia  rules on access to public telecommunications services, and the obligations of public 
telecommunications services and major providers. It applies to measures affecting trade in the 
telecommunications sector, but not to measures relating to broadcast or cable distribution of radio 
or television programming except to ensure that enterprises operating broadcast stations and cable systems have continued access to and use of public telecommunications services.  
4.30.   The disciplines of the Chapter on Te lecommunications and on access to the public 
telecommunications network largely draw on the A nnex and adds two elements (provide services 
to individual or multiple end users over leased circuits and perform switching, signalling, 
processing and conversion functions).Access to pu blic telecommunications services is assured for 
(i) any public telecommunications service, including leased circuits, offered in a Party's territory or across its borders, on reasonable and non-discriminatory terms and conditions; and (ii) the movement of information in a Party's territory or across its borders and for access to information 
contained in databases or otherwise stored in machine-readable form in the territory of either 
Party. However, the Parties may adopt any meas ures necessary to ensure the security and 
confidentiality of messages (Article 12.2).  
4.31.  Suppliers of public telecommunications services shall be granted interconnection at 
"reasonable rates", number portability (to the extent technically feasible)
23, and dialling parity 
(Article 12.3). In Annex 12-A, the United States exempts its suppliers of commercial mobile 
services from commitments on number portability and dialling parity; in addition, a US state 
regulatory authority may exempt a rural local exchange carrier, as defined under domestic law, from such obligations. Interconnection commitments in the Agreement mirror those by the United States in the GATS. Each Party shall also ensure that any supplier that it authorizes to 
operate a submarine cable system in its territory  as a public telecommunications service accords 
"reasonable and non-discriminatory" treatment with respect to access to that system (including landing facilities) to suppliers of public telecommunications services (Article 12.5).  
4.32.  All suppliers of public telecommunications services of a Party
24, and licensed in the territory 
of the other Party, are to be given no less favourable treatment than the major supplier accords to its subsidiaries, its affiliates, or non-affiliated service suppliers for the availability, provisioning, 
rates, or quality of like public telecommunications services; and the availability of technical 
interfaces necessary for interconnection. Both Parties must ensure that major suppliers provide interconnection for suppliers of public telecommunications services of the other Party on request and in a timely manner, at any technically feasible point in the major suppliers' network, at 
cost-oriented rates and under non-discriminatory terms and rates and of a quality no less 
favourable than provided by the supplier for it s own like services. The Agreement also contains 
"competitive safeguards" like those in the United States' GATS Schedule to prevent major 
suppliers, alone or together, from resorting to anti-competitive practices. For the provision of 
value-added services neither Party may require suppliers to provide services to the general public; cost justify or file tariffs for those services; interconnect its networks with any particular customer 
and conform with any particular standard or technical regulation other than for interconnection 
with a public telecommunications network. Nevertheless, a Party may take such actions to remedy any actions by a value-added service supplier that it deems to be anti-competitive. The Agreement's competition provisions are to be enforced by each Party's competent authority which 
                                               
23 This provision applies to Bahrain upon a determination by its telecommunications regulatory body 
that sufficient consumer demand exists for number portability.  
24 Service supplier of the other Part y means, with respect to a Party, a person that is either a BIT 
investment in the territory of the Party or a person of the other Party and that seeks to supply or supplies 
services in or into the territory of the Party, and includes a supplier of public telecommunications services (Article 12.17). WT/REG219/2/Rev.1 
 
- 33 - 
 
  shall include the ability to imposed effective sanctions including financial penalties and revocation 
of licences. Each Party may forbear, to the extent provided for in its law, from applying a regulation to a service that the Party classifies as a public telecommunications service, if its telecommunications regulatory body determines it  to be unnecessary to prevent unreasonable or 
discriminatory practices or for the protection of consumers, or that it is consistent with the public 
interest (Article 12.15).  
4.33.  The principle of transparency (Article 12.13); obligations related to universal services 
(Article 12.8) and provisions on allocation and use of scarce telecommunications resources 
(Article 12.10) are also included under the same terms and conditions as in the United States' GATS Schedule. For Bahrain, these are all new commitments under the Agreement. 
4.34.  A specific mechanism for the settlement of disputes relating to telecommunications matters 
envisages recourse to the Parties' Telecommunication Regulatory Bodies by enterprises and suppliers of public telecommunications services, which includes review and appeal procedures 
(Article 12.12).  
4.35.  Chapter 12 is accompanied by two Side  Letters on technology neutrality and on 
interconnection rates, dated 14 September 2004. In  the first letter, Bahrain indicated that its 
Telecommunication Regulatory Authority (TRA) had awarded licenses to two mobile services 
suppliers and that, unless the two operators exhibi ted anti-competitive conduct, Bahrain intended 
to maintain this duopoly until 31 December 2005. A consultative process in the TRA was to have started by the end of 2007, at the latest, to de cide whether to issue additional licenses for 
commercial mobile services. Bahrain indicated that it issued a third mobile licence in 2009. In the 
second letter, the United States, noted that a new Bahrain law on liberalization of the telecommunications services market had been enacted; the Parties' mutual expectation was that a 
competitive environment resulting from market liberalization would facilitate effective commercial 
negotiations that would drive international interconnection rates down to cost-oriented levels and that Bahrain's regulator would generally not intervene in interconnection arrangements unless it 
became apparent that liberalization had failed to result in cost-oriented interconnection rates. 
4.6.1.3  Audiovisual services 4.36.  The United States GATS commitments on audiovisual services applies limitations on market 
access to Mode 3 in the radio and television transmission services sub-sector, and on national 
treatment to Modes 1 and 3 in the motion pictur e and video tape production and distribution 
services sub-sector. Under the Agreement, the United States has scheduled no reservations in the audiovisual sector. For Bahrain, there were no commitments in this sector under the GATS and 
under the Agreement it maintains no reservations. 
4.6.2  Financial services 4.6.2.1  Scope and definitions 
4.37.  Chapter 11 on Financial Services applies to measures adopted or maintained by the Parties 
relating to: (a) financial institutions of the other Party
25; and (b) cross-border trade in financial 
services (Article 11.1). Financial institutions of the other Party refers to a financial institution, including a branch, located in the territory of a Party that is controlled by persons of the other 
Party. Cross-border trade in financial services includes the supply of a financial service: from the 
territory of one Party into the territory of the othe r Party; in the territory of one Party by a person 
of that Party to a person of the other Party; or by a national of one Party in the territory of the 
other Party, but does not include the supply of a financial service in the territory of a Party by an 
investor of the other Party, or a BIT investment, in a financial institution of the other Party (Article 11.21). Chapter 10 on trade in services applies to measures adopted under 
Chapter 11 to the extent that Chapter 10 or one of its articles is incorporated into Chapter 11. 
                                               
25 "Financial institution"  means any financial intermediary or other enterprise that is authorized to do 
business and regulated or supervised as a financial institution under the law of the Party in whose territory it is located. WT/REG219/2/Rev.1 
 
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  4.38.  Chapter 11 does not apply to activities or se rvices forming part of a public retirement plan 
or statutory system of social security; or to activities or services conducted for the account or with the guarantee or using the financial resources of the Party, including its public entities (Article 11.3). However, the chapter will apply to th ese activities if a Party allows these services to 
be provided by its financial institutions in competition with a public entity or financial institution 
(Article 11.1.3).  
4.39.  Definitions for Chapter 11 are contained in Article 11.21. "Financial services" means any 
service of a financial nature, including all insurance and insurance-related services, and all banking 
and other financial services (excluding insurance), as well as services incidental or auxiliary to a service of a financial nature. In Annex 11-E (definition of financial services), the United States specifies that Shariah -compliant financial services are covered under the Agreement 
and it will consider proposals by financial institutions from Bahrain to offer such services in the 
United States to the extent consistent with its laws, including any regulatory or supervisory requirements.  
4.6.2.2  Denial of benefits 
4.40.  As provided for under Chapter 10 for cross border trade in services, the benefits of 
Chapter 11 may be denied to an investor that is an enterprise of the other Party and to a financial 
institution of a Party that is a BIT investment of that investor if persons of a non-Party own or 
control the enterprise; and the denying Party does not maintain diplomatic relations with the non-Party; or adopts or maintains measures with respect to the non-Party or a person of the non-Party that prohibit transactions with the enterprise or that would be violated or circumvented 
if the benefits of the Chapter were accorded to th e enterprise or the financial institution. Benefits 
may also be denied to an investor that is an enterprise of the other Party and to a BIT investment of that investor if the enterprise has no substant ial business activities in the territory of the other 
Party and persons of a non-Party, or of the denying Party, own or control the enterprise. 
4.6.2.3  National and MFN treatment 4.41.  Under Article 11.2.1, each Party shall accord national treatment to financial institutions of 
the other Party in like circumstances, with respect to the establishment, acquisition, expansion, 
management, conduct, operation, and sale or other disposition of financial institutions. Article 11.3 grants MFN treatment for each Party's financial institutions and cross-border financial services suppliers. However, a Party may recognize a non-Party's prudential measures in the 
application of this Chapter, through unilateral re cognition, harmonization or other means, or as a 
result of an agreement or arrangement with the no n-Party. In such a case, the other Party shall be 
informed and have the opportunity to accede to or negotiate a comparable agreement 
(Articles 11.3.2-4).  
4.42.  Neither Party may require financial institutions of the other Party to engage individuals of 
any particular nationality as senior managerial or other essential personnel (Article 11.8). Where a 
Party requires a financial institution or a cross-border financial service supplier of the other 
Party to be a member of, participate in, or have access to a self-regulatory organization to provide a financial service in or into its territory, the Party shall ensure observance of national and MFN treatment obligations by such a self-regulatory organization (Article 11.12). 
4.6.2.4  Market access 
4.43.  Article 11.4 prohibits the Parties from adop ting or maintaining, with respect to financial 
institutions or investors of the other Party seeking to establish such institutions, measures that 
impose limitations on: the number of financial institutions; the total value of financial service 
transactions or assets; the total number of financial service operations or the total quantity of financial services output; the total number of natural persons that may be employed in a particular 
financial service sector or that a financial institution may employ and who are necessary for, and 
directly related to, the supply of a specific financial service; or that restrict or require specific types of legal entity or joint ventures through which a financial institution may supply a service.  WT/REG219/2/Rev.1 
 
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  4.44.  Under Article 11.6, each Party shall permit financial institutions from the other Party to 
supply any "new financial services"26 that the first Party would permit its own financial institutions, 
in like circumstances, to supply under its domestic laws, provided that the introduction of the new financial service does not require the Party to adopt a new law or modify an existing law. A Party 
may determine the institutional and juridical forms for the supply of the financial services and may 
require an authorization, providing that the decision to authorize is made within a reasonable time and is refused only for prudential reasons. In addition, Bahrain undertakes to consult with the 
United States, upon request, where an application by a financial institution from the United States 
to supply a new service has been denied (Annex 11-B). 
4.6.2.5  Liberalization commitments  and non-conforming measures 
4.45.  The Agreement, as it does for cross-border trade in services, adopts a "negative-list 
approach" for financial services with all sectors and sub-sectors assumed to be liberalized, unless 
as specified in the Parties' Schedules. Annex III contains the Parties' non-conforming measures with respect to Articles 11.2 (national treatment), 11.3 (MFN treatment), 11.4 (market access for 
financial institutions), 11.5 (cross-border trade) and 11.8 (senior management and boards of 
directors). However, pursuant to Article 11.5.1, for cross-border trade in financial services the Parties take a "positive list approach"; the services covered are specified by each Party in 
Annex 11-A.
27 For mode 1, both the United States and Bahrain list the following sectors in the 
annex: (a) insurance of risk relating to maritime shipping and commercial aviation and space launching and freight (including satellites)
28 and goods in international transit; and (b) reinsurance 
and retrocession services auxiliary to insurance29 and insurance intermediation, such as 
brokerages and agencies. For Bahrain, national treatment obligations are also extended to direct 
insurance (life and non-life) and to reinsurance and retrocession services. In addition, for both Parties, national treatment obligations pursuant to Article 15.5.1 apply to cross-border trade in 
financial services supplied by a national of a Party in the territory of the other Party (Mode 4). In 
banking and all other financial services (excluding insurance), each Party shall accord national treatment with respect to the provision and transfer of financial information and financial data 
processing and related software, and advisory and other auxiliary services (no intermediation).  
4.46.  In addition, the Parties have taken specific commitments in sectors listed in Annex 11-B. 
These relate to: expedited availability of new insu rance products subject to approval procedures by 
the Bahrain authorities; the supply of investment advice and portfolio management services by a 
financial institution (other than a trust company) outside its territory to a collective investment 
scheme located in the Party's territory
30; new financial services; and Bahrain's commitments in the 
insurance sector to ensure that any laws, regulations and rules that are developed as a result of 
the review will treat the United States' enterprise s on a non-discriminatory basis, subject only to 
non-conforming measures listed in Bahrain's Sc hedule to Annex III. Furthermore, insurance 
suppliers established in Bahrain's territory prior to  the date of signature of the Agreement shall be 
allowed to maintain, as well as increase the scope of their business activities in existence on that 
date. This provision shall not prevent Bahrain from applying future non-discriminatory prudential measures to such suppliers. 
4.47.  Following the "negative list" approach, the Parties exempt from obligations on national and 
MFN treatment (Articles 11.2 and 11.3), market access (Article 11.4), cross-border trade 
(Article 11.5), or senior management and board of directors (Article 11.8), any existing non-conforming measure that they maintain at the central, regional or local levels, as well as to its 
continuation, prompt renewal or amendment, as set out in their Schedules to Annex III.  
                                               
26 A new financial service  is defined as a financial service not supp lied in the Party's territory that is 
supplied within the territory of the other Party, and incl udes any new form of delivery of a financial service or 
the sale of a financial product that is not sold in the Party's territory. 
27 This obligation does not require a Party to permit such suppliers to do business or solicit in its 
territory. Each Party may define "doing  business" and "solicitation" for purp oses of this obligation, provided 
that those definitions are not inconsistent with the Article's provision. 
28 In such a sector, Bahrain's commitments will appl y one year after the Agreement's entry into force. 
29 As specified in Article 11.21(d): consultancy, actuarial, risk assessme nt, and claim settlement 
services. 
30 This commitment is subject to Article 11.1 (Scope and coverage) and to Article 11.5.3 (registration of 
foreign service suppliers). WT/REG219/2/Rev.1 
 
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  4.48.  Under Annex 3, the United States retains some reservations on national treatment, such as 
the criteria of "home state" in banking and "state of domicile" in insurance (Table 4.6). With respect to market access for financial institutions in banking and other financial services (not insurance), Article 11.9(c) (amendment of non-conforming measures) shall apply only to the 
United States' non-conforming measures on market access limitations (Paragraph (a) of 
Article 11.4) and not on specific types of legal entities or joint ventures (Paragraph (b)). With respect to market access for financial institutions in the insurance sector, the United States 
reserves the right adopt or maintain any measure that is not inconsistent with its obligations under 
Article XVI of the GATS.  
Table 4.6 Non-conforming measures listed by the United States in Annex III  
Sub-Sector Reservation Mode Description 
Banking and other Financial 
Services (excluding insurance) SMBD CBTS Nationality requirement 
Banking and other Financial 
Services (excluding insurance) NT/MA CBTS Nationality requirement 
Banking and other Financial 
Services (excluding insurance) NT/MA CBTS Credit Unions, savings banks or savings 
associations may not be established through branches of corporations organized under a foreign country's law 
Banking and other Financial 
Services (excluding insurance) NT/MA CBTS Requirement to establish an insured banking 
subsidiary for foreign banks to accept or maintain 
domestic retail deposits of less than US$100,000 
Banking and other Financial 
Services (excluding insurance) NT CBTS Registration of foreign bank as "investment 
adviser" to engage in securities advisory and investment management services 
Banking and other Financial 
Services (excluding insurance) NT CBTS Exclusion from participation in the Federal Reserve 
System and from voting for directors of the Federal 
Bank 
Banking and other Financial Services (excluding insurance) MA CBTS No commitments with respect to Article 11.4(b) for 
the expansion, through establishment or acquisition of a branch, of a foreign bank 
(application of national treatment) 
Banking and other Financial 
Services (excluding insurance) MA CBTS Interstate expansion by a foreign bank shall be 
accorded on a national treatment basis 
Banking and other Financial 
Services (excluding insurance) NT/MA CBTS Establishment of a federal branch or agency by a 
foreign bank in the United States prohibited 
Banking and other Financial 
Services (excluding insurance) MFN/MA CBTS Reciprocity test 
Banking and other Financial Services (excluding insurance) MFN/MA CBTS Reciprocity requirement  
Banking and other Financial 
Services (excluding insurance) MFN CBTS A broker-dealer registered under U.S. law that has 
its principal place of business in Canada may 
maintain its required reserves in a bank in Canada 
subject to supervision by Canada. 
Banking and other Financial 
Services (excluding insurance) NT CBTS Advantages for Government-Sponsored Enterprises 
Banking and other Financial 
Services (excluding insurance) NT/MFN/ 
MA/SMBD CBTS All existing non-conforming measures at the 
regional level 
Insurance NT/CBT CBTS Branches of foreign insurance companies are not 
permitted to provide surety bonds for US Government contracts WT/REG219/2/Rev.1 
 
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  Sub-Sector Reservation Mode Description 
Insurance NT/CBT CBTS Demonstration of first offer in the United States 
market for risks connected to maritime vessels 
Insurance MA CBTS Measures not conforming with Article XVI of GATS 
Insurance NT/MFN/ 
MA/SMBD CBTS All existing non-conforming measures at the 
regional level 
Note: CBTS: Cross-border trade in services; MA: Mark et Access; MFN: Most-Favoured-Nation treatment; 
NT: National Treatment; SMBD: Senior Management  Board of Directors; CBT: Cross-Border Trade 
Source: The Free Trade Agreement between the United  States and the Kingdom of Bahrain, Annex III. 
4.49.  Bahrain's Schedule of commitments in the GATS includes only financial services. These 
commitments are made in accordance with the GATS and the Annex on Financial Services. Under the Agreement, apart from a limited number of rese rvations the sector is liberalized for suppliers 
from the United States (Table 4.7). Some of these reservations apply for a limited period of time; 
for instance, the number of new licenses granted to supply general (non-life) insurance will be limited to six months as from the Agreement's entry into force, while new license for leasing 
service shall be provided no later than 12 months  after the enactment of the Agreement. Bahrain 
specifies that with respect to market access for financial institutions, juridical persons supplying financial services and constituted under the laws of Bahrain are subject to non-discriminatory 
limitations on juridical form. 
Table 4.7 Non-conforming measures  listed by Bahrain in Annex III  
Sub-Sector Reservation Mode Description 
Banking and other financial 
services  NT CBTS Advantages and exemptions for Bahrain 
Housing Bank and the Bahrain Development Bank 
Insurance MA CBTS Limitation on new licenses for 6 months from 
the Agreement's entry into force 
Leasing MA CBTS Limitation on license for 12 months after the 
Agreement's entry into force 
Money changers  MA CBTS Money changers must be incorporated in 
Bahrain  
Note: CBTS: Cross-border trade in services; NT: National Treatment; MA: Market Access  
Source: The Free Trade Agreement between the United  States and the Kingdom of Bahrain, Annex III. 
4.6.2.6  Other provisions 
4.50.  Transparency provisions are contained in Article 11.11, which requires the Party, to the 
extent practicable, to publish in advance any re gulations of general application and to provide 
interested persons and the other Party a reasonable opportunity to comment. Each Party shall also ensure that all measures of general application are administered in a reasonable, objective and 
transparent manner (Article 11.14). 
4.51.  Notwithstanding the provisions of the Ag reement, nothing shall prevent the parties from 
adopting measures based on prudential reasons,  including for the protection of investors, 
depositors, policy holders, or persons to whom a fi duciary duty is owed by a financial institution or 
cross-border financial service supplier, or to ensure the integrity and stability of the financial system. Article 11.17 does not require the Parties to furnish or allow access to any confidential 
information which would be contrary to the public interest or which would prejudice the legitimate 
commercial interests of a particular enterprise.  
4.52.  Article 11.18 establishes a Financial Services Subcommittee, which consists of each Party's 
authority responsible for financial services - for Bahrain, the Central Bank of Bahrain and for the 
United States, the Department of Treasury for banking and other financial services and the Office 
of the United States Trade Representative, in c oordination with the Department of Commerce for WT/REG219/2/Rev.1 
 
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  insurance (Annex 11-D). The Subcommittee shall meet  annually, or as otherwise agreed, and be 
responsible for the implementation and further elaboration of Chapter 11 and for considering any issue referred to it by the Parties. It shall be informed of the results of consultations on any matter relating to financial services (Article 11.19).  
4.53.  For disputes pertaining to financial services, panellists must have expertise or experience in 
financial services law or practice and must be chosen on the basis of objectivity, reliability, and sound judgment. Where a panel finds that a measure is inconsistent with the Agreement and the 
measure in question affects any sector other than the financial services sector, the complaining 
Party may not suspend benefits in the financial services sector; if it finds that the measure is inconsistent with the financial services sector and any other sector, the complaining Party may suspend benefits in the financial services sector that have an effect equivalent to the effect of the 
measure in the Party's financial services sector (Article 11.20).
31 
4.54.  Chapter 11 is accompanied by three Side Le tters concluded by the Parties on cross-border 
insurance suppliers, independent agents and non-life insurance, dated 14 September 2004. In the 
first letter, the Parties agree that each of them may require registration or authorization of the 
relevant financial institutions and/or intermediaries for prudential purposes (excluding the obligation of local presence) and that Bahrain may require non-Bahraini insurance companies 
(excluding those already present in Bahrain) to be classified by an internationally recognized 
classified institution. They also specify that Article 11.10.4 (Exceptions) allows each Party to 
require the relevant financial services suppliers to comply with rules and regulation prescribed by the relevant authorities. In the letter on independent agents, Bahrain commits to ensure that any 
laws, regulations, and rules that are developed as a result of a review of the insurance sector will 
permit United States insurance suppliers to sell their products through independent agents. In the side letter on non-life insurance, the Parties agree that the six-month period provided for in 
Bahrain's Schedule to Annex III may be extended by mutual agreement of the Parties.  
4.6.3  Transportation services 4.55.  In transportation services the United States' commitments under the Agreement exceed 
those in its GATS Schedule in the maritime transport sub-sector. Maritime transport is not included 
in either Party's Schedule to the GATS. The United States' Schedule in Annex II reserves the right to adopt non-conforming measures in the maritime transportation sector for national and MFN treatment and local presence, except for and subject to reciprocity: (a) vessel construction 
and repair and (b), landside aspects of port ac tivities, including operation and maintenance of 
docks; loading and unloading of vessels directly to  or from land; marine cargo handling; operation 
and maintenance of piers; ship cleaning; steved oring; transfer of cargo between vessels and 
trucks, trains, pipelines, and wharves; waterfront terminal operations; boat cleaning; canal 
operation; dismantling of vessels; operation of marine railways for dry-docking; marine surveyors, except cargo; marine wrecking of vessels for scrap; and ship classification societies. 
5  GENERAL PROVISIONS OF THE AGREEMENT AFFECTING GOODS AND SERVICES 
5.1  Transparency 5.1.  Article 17.1 requires the Parties to promptly  publish or make publicly available their laws, 
regulations, procedures, and administrative rulings  of general application. The Parties must also, 
to the extent possible, notify each other of any proposed or actual measure that might materially 
affect the operation of the Agreement or substantially affect the interests of the other Party (Article 17.2.1). Even if a Party does not notify a measure to the other Party, that other Party can 
request information on that measure and should receive a prompt response (Article 17.2.2). 
A review and appeal mechanism shall be established or maintained through impartial and independent judicial, quasi-judicial, or administrative tribunals (Article 17.4.1).  
5.2.  The Parties are determined to eliminate bribery and corruption in international trade and 
investment and will jointly pursue this aim in relevant international fora. At the domestic level, 
they will adopt or maintain the necessary legislative or other measures to establish criminal offences against bribery and corruption affecting international trade or investment (Article 17.5).  
                                               
31 Provisions on dispute settlement under Articl e 11.20 modify Chapter 19 (Dispute settlement). WT/REG219/2/Rev.1 
 
- 39 - 
 
  5.3.  In the financial services sector, transparency shall be granted through publication in advance 
of any regulations and through the possibility for any person to comment on such regulations. The time-frame for the adoption of administrative decisions relating to the supply of a financial services shall not be more than 120 days (Article 11.11).  
5.2  Current payments and capital movements 
5.4.  Under Article 10.10, each Party shall perm it all transfers and payments relating to the 
c r o s s - b o r d e r  s u p p l y  o f  s e r v i c e s  t o  b e  m a d e  f r e e l y ,  i n  u s a b l e  c u r r e n c y  a t  t h e  m a r k e t  r a t e  o f  
exchange prevailing at the time of transfer and without delay into and out of its territory. A Party 
may, however, deny a transfer or payment in case  of: (i) bankruptcy, insolvency, or the protection 
of the rights of creditors; (ii) issuing, trading,  or dealing in securities, futures, options, or 
derivatives; (iii) financial reporting or record k eeping of transfers when necessary to assist law 
enforcement or financial regulatory authorities; (iv) criminal or penal offences; or (v) compliance 
with orders or judgments in judicial or administrative proceedings.  
5.5.  Each Party shall grant financial institutions  of the other Party access to payment and clearing 
systems operated by public entities, and to official funding and refinancing facilities available in the 
normal course of ordinary business. This paragrap h is not intended to confer access to the Party's 
lender of last resort facilities (Article 11.13). 
5.3  Exceptions 
5.6.  Exceptions to the Agreement's provisions are laid down in Chapter 20. Article XX of 
GATT 1994 is incorporated into and made part of the Agreement, mutatis mutandis , with regard to 
provisions contained in Chapters 2-7, while Ar ticle XIV of the GATS applies with regard to 
Chapters 10, 12 and 13, including environmental me asures necessary to protect human, animal or 
plant life or health (Article 20.1). The Agreement shall not apply to measures adopted for security reasons (Article 20.2), and on taxation (Article 20.3), and shall not require the Parties to disclose 
any information relating to their laws on personal privacy or financial affairs and accounts of 
individual customers of financial institutions (Article 20.4).  
5.4  Accession 
5.7.  Under Article 21.4, any country or group of countries may become a Party to the Agreement, 
subject to terms and conditions to be agreed be tween such country or countries and the Parties 
and following approval in accordance with the applicable legal requirements and procedures of each country.  
5.8.  Either Party may terminate this Agreement 180 days following written notice to the other 
Party (Article 21.5.2). 
5.5  Institutional framework 
5.9.  A Joint Committee has been established under Article 18.2 comprising government officials of 
both Parties and chaired by the United States Trade Representative and Bahrain's Minister of Finance and National Economy, or their designees. The Committee shall convene in regular session 
every year, and in special session within 30 days of a request from a Party. The functions of the 
Joint Committee are: review of the general functioning of the Agreement; review and 
consideration of specific matters; settlement of disputes, including through consultation; consideration and adoption of any amendment or other modification to the Agreement; 
consideration of ways to further enhance trade relations; and cooperation between the Parties. The 
first meeting of the Joint Committee was held in 2008, during which a broad range of issues were discussed including a review of progress under th e Agreement; implementation and GCC issues; 
the status of WTO DDA negotiations; follow-up mechanisms and interim meetings among experts. 
The second meeting was held in 2009 which discussed efforts by the Parties to effectively implement key customs related aspects of the Ag reement, including through targeted technical 
assistance to Bahrain's customs authorities and trade initiatives of the GCC. Officials also signed a 
Joint Committee Decision on the Government Pr ocurement Annex and a Protocol making changes 
to Annex 3-A of the Agreement on the HS Description and Coding System. The Parties also discussed initiatives to monitor implementation and compliance with the labour and environmental WT/REG219/2/Rev.1 
 
- 40 - 
 
  obligations of the Agreement and additional cooper ative efforts on labour rights and environmental 
protection. The third meeting has not yet been scheduled.  
5.6  Dispute settlement 5.10.  Chapter 19 describes the procedure for the avoidance or settlement of disputes between the 
Parties on matters relating to the interpretation or application of the Agreement, or wherever a 
Party considers that: (a) a measure by the other Party is inconsistent with its obligations; (b) the other Party failed to carry out its obligations; or (c) a benefit the Party could reasonably have 
expected to accrue to it under Chapters 2 (National Treatment and Market Access for Goods), 
4 (Rules of Origin), 9 (Government Procuremen t), 10 (Cross-Border Trade in Services), or 
14 (Intellectual Property Rights) is being nullified or impaired as a result of a measure that is not inconsistent with the Agreement (Article 19.2).
32 Under Article 19.4, the complaining Party may 
select the forum for the settlement of the disput e by notifying the other Party of its selected 
forum; the forum chosen must be used to the exclusion of other possible fora. The procedure for 
the settlement of a dispute is summarized in the Chart below. 
                                               
32 Neither Party may invoke this paragraph with re spect to a benefit under Chapter 10 (Cross-Border 
Trade in Services) or Chapter 14 (Intellectual Property Ri ghts) if the measure is subject to an exception under 
Article 20.1 (General Exceptions). WT/REG219/2/Rev.1 
 
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  Chart 5.1 Synopsis of the Agreement's dispute settlement provisions 
 
Source: The Free Trade Agreement between the United States and Bahrain, Chapter 19. 
5.11.  Specific provisions apply to disputes concerning labour, environment, telecommunications 
and financial services. In these cases, the panellists must have expertise or experience relevant to the subject matter that it is under dispute. For environmental and labour disputes, the monetary 
assessment shall be paid into a fund established by the Joint Committee and be used for 
appropriate labour or environment related initiatives (Article 19.12.4).
33  
                                               
33 Article 19.12.2 specifies that the amount of the assessment shall not exceed US$15 million annually, 
adjusted for inflation as specified in Annex19-A. Referral to the Joint Committee   (Art. 19.6) Consultations (Art. 19..5) 
60 or 20 days (perishable goods) 
60 or 30 days (perishable goods) 
Written request for establishing a Panel  
(Art. 19.7) 
Composition  (Art. 19.7) 
Rules of procedure  (Art. 19.8) 
Max 60 days for composition 
Panel examination  (Art. 19.9) 
180 days 
Panel  initial report to be sent to 
the parties (Art. 19.9.1) 
45 days 
Panel final report  (Art. 19.9.4) 
15 days from parties release 
Report becomes public (Art.19.9.4) Implementation 
In agreement by the parties (Art. 19.10) 
45 days from receipt of final report 
failure to reach agreement 
Non-implementation 
Negotiations on mutually acceptable 
compensation (Art. 19.11.1) No retaliation Retaliation (Art. 19.11..3) 
- 30 days after retaliation notice; or 
- after panel determination (See below) 
30 days from retaliation notice 
Panel reconvenes 
upon request from losing party (Art. 19.11.3) 
90 or 120 days from panel reconvention 
Panel determination  (Art. 19.11.4) 
Monetary assessment (Art. 19.11.5)  
upon notice from the losing Party within: 
- 30 days from notice of retaliation; or 
- 20 days from panel determination 
Failure to pay monetary assessment Notice of retaliation (Art. 19.11.2) 
-If no agreement on compensation (30 days); or 
-failure by non-conforming party to observe agreed 
compensation or resolution WT/REG219/2/Rev.1 
 
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  5.12.  The Joint Committee shall review the implemen tation status of the Agreement not later than 
five years after its entry into force, or within six months after benefits have been suspended or monetary assessments have been imposed in five proceedings initiated under this Chapter, whichever occurs first (Article 19.14).  
5.7  Relationship with other agreements concluded by the Parties 
5.13.  Each Party affirms its existing rights and obligations under existing bilateral and multilateral 
agreements to which both Parties are party, in cluding the WTO Agreements. The Agreement shall 
not be construed to derogate from any legal obligation between the Parties that entitles goods or 
services, or suppliers of goods or services, to treatment more favourable than it accords (Article 1.2). 
5.14.  Table 5.1 lists all other regional trade agr eements (RTAs) notified and not notified to the 
GATT/WTO and in force to which the United States and Bahrain are party. 
Table 5.1 United States and Bahrain: Pa rticipation in other RTAs (notified and 
non-notified in force), as of 9 December 2014 
RTA Name Date of 
entry into 
force Coverage GATT/WTO Notification 
Year WTO Provision  
UNITED STATES 
US - Panama 31-Oct-12 Goods & Services 2012 GATT Art. XXIV & GATS Art. V 
US - Colombia 15-May-12 Goods & Services 2012 GATT Art. XXIV & GATS Art. V 
Republic of Korea - US 15-Mar-12 Goods & Services 2012 GATT Art. XXIV & GATS Art. V 
US – Peru 01-Feb-09 Goods & Services 2009 GATT Art. XXIV & GATS Art. V 
US - Oman 01-Jan-09 Goods & Services 2009 GATT Art. XXIV & GATS Art. V 
Dominican Republic - Central 
America - United States Free Trade Agreement (CAFTA-DR) 01-Mar-06 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
US - Morocco 01-Jan-06 Goods & Services 2005 GATT Art. XXIV & GATS Art. V 
US - Australia 01-Jan-05 Goods & Services 2004 GATT Art. XXIV & GATS Art. V 
US - Singapore 01-Jan-04 Goods & Services 2003 GATT Art. XXIV & GATS Art. V 
US – Chile 01-Jan-04 Goods & Services 2003 GATT Art. XXIV & GATS Art. V 
US - Jordan 17-Dec-01 Goods & Services 2002 GATT Art. XXIV & GATS Art. V 
North American Free Trade 
Agreement (NAFTA) 01-Jan-94 Goods  
Services 199319
95 GATT Art. XXIV 
GATS Art. V 
US - Israel 19-Aug-85 Goods 1985 GATT Art. XXIV 
BAHRAIN 
Gulf Cooperation Council 
(GCC) 01-Jan-03 Goods 2008 
2009  Enabling Clause  
GATT Art. XXIV 
Pan-Arab Free Trade Area (PAFTA) 01-Jan-98 Goods 2006 GATT Art. XXIV 
EFTA - GCC 01-Jul-14 Goods & Services Not notified 
Singapore - GCC 01-Sep-13 Goods & Services Not notified 
Source: WTO Secretariat. 
5.15.  Article 21.3 says that if any provision of the WTO Agreement that the Parties have 
incorporated into the Agreement is amended, the Parties shall consult to consider amending the 
relevant provision of the Agreement, as appropriate, in accordance with the amendment procedure.  WT/REG219/2/Rev.1 
 
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  5.8  Government Procurement 
5.8.1  General provisions 5.16.  Chapter 9 and related annexes contain detailed provisions on government procurement.
34 
The Agreement covers procurement: of goods, services or both by any contractual means- 
including build-operate-transfer and public works concession contracts, with a value equal to or 
exceeding thresholds specified in Annexes 9-A-1 and 9-A-2 and by entities listed therein.35 
Services excluded from the scope of Chapter 9 are listed in the Parties' respective schedules to 
Annex 9-C, as shown in Box 5.1. Chapter 9 also does not apply to procurement by one Bahraini 
government entity of a good or service obtained or acquired from another Bahraini government entity, nor to set-asides on behalf of small or minority-owned businesses of the United States (Annex 9-E).  
Box 5.1 Procurement of services excluded by the scope of the Agreement 
Schedule of Bahrain 
• Arbitration and conciliation services. 
• Financial intermediation services, except: investment banking and related services, insurance and pension 
services. 
• Management of government-owned facilities, including: administrative facilities and service buildings, 
airfield, communications, missile facilities, educational, hospital and industrial buildings, the Royal Court, the 
Prime Minister's Court, and the Crown Prince's Court buildings, warehouse buildings, research and 
development facilities, other buildings, conservation and development facilities, highways, roads, streets, 
bridges, dams, Electric Power Generation (EPG) facilities, utilities, other non-building facilities. 
• Printing of revenue stamps, bank notes, and religious material.  
• Research and Development.  
• Public Utilities.  
• Telecommunications and Telecommunications Network Management Services 
Schedule of the United States 
• Research and development: all classes. 
• Information processing and related telecommunication services, including transmission, ADP teleprocessing 
and time-sharing, telecommunications ne twork management system services. 
• Maintenance, repair, modification, rebuilding and installation of goods/equipment including. 
• Maintenance, repair, modification, rebuilding and installation of equipment related to ships and non-nuclear 
ship repair. 
• Operation of all government-owned facilities operated by  the Department of Defence, Department of Energy, 
and the National Aeronautics and Space Administration  and, for all entities, research and development 
facilities. 
• Utilities: all classes 
• Transportation, travel and relocation services: all classes except travel agent services. 
• The procurement of any service in support of military forces overseas.  
Source: The Free Trade Agreement between the United States and Bahrain, Annex 9-C. 
                                               
34 The United States is a member to the WTO Government Procurement Agreement (GPA) since its entry 
into force (1 January 2006), while Bahrain is an observer. http://www.wto.org/english/docs_e/legal_e/gpr-
94_01_e.htm  
35 The Chapter on government procurement does not apply to: (a) non-contractual agreements or any 
form of assistance that a Party or a government enterp rise provides to persons or to state, regional, or local 
governments; (b) purchases funded by international grants, loans, or other international assistance where the 
provision of such assistance is subjec t to conditions inconsistent with the Chapter; (c) acquisition of fiscal or 
depository agency services, liquidation and management services for regulated financial institutions and sale 
and distribution services for government debt; (d) proc urement by any entity not listed in Annexes 9-A-1 or 
9-A-2; (e) the procurement of transpor tation services that form a part of , or are incidental to, a procurement 
covered by this Chap ter (Article 9.1.3). WT/REG219/2/Rev.1 
 
- 44 - 
 
  5.17.  All construction services are covered by the Agreement according to Annex 9-D, except: 
(i) for Bahrain, construction services for buildings intended for religious purposes and general construction services of civil engineering works by a covered entity on behalf of a non-covered entity; and (ii) for the United States, the proc urement of dredging services. "Buy national" 
requirements for articles, supplies, or materials acquired for use in construction services contracts 
covered by Chapter 9 shall not apply to goods of ei ther Party that are covered by the Agreement.  
5.18.  Each Party may modify its coverage under this Chapter by notifying, in writing, the other 
Party and, where required, by providing acceptable  compensation to the other Party to maintain a 
level of coverage comparable to that existing before the modification. The notified Party has 30 days to object. Compensatory adjustments are not needed: (a) in case of formal rectification or minor amendments to a Party's schedule to Annex 9-A-1 or 9-A-1 accepted by the other Party; or 
(b) when the proposed modification covers a proc uring entity over which the Party no longer has 
control or influence (Article 9.12). The Joint Commit tee will be responsible for the adoption of any 
such modification. 
5.19.  National treatment and non-discrimination principles are recognized under 
Article 9.2. Accordingly, each Party, including its procuring entities, must accord unconditionally to 
the goods and services, as well as to suppliers of the other Party offering the goods and services of 
a Party, treatment no less favourable than that accorded to its own goods, services, and suppliers. 
A procuring entity shall not discriminate between locally established suppliers on the basis of 
foreign affiliation or ownership, nor on the basis th at the goods or services provided are offered by 
a supplier of the other Party.
36 Transparency should be ensured through prompt publication of all 
laws, regulations and administrative rulings of genera l application in officially designated electronic 
or paper media, as well as through publication of notice of intended procurement by procuring 
entities of each Party (Article 9.3). The use of o ffsets in the qualification and selection of suppliers, 
goods and services, in the evaluation of tend ers or the award of contracts is prohibited 
(Article 9.2.4). 
5.8.2  Tendering procedures 
5.20.  Under Article 9.5, except for certain circumstances, the deadline for submission of tenders 
must be at least 40 days from the date of  the publication of the tendering notice.37 The time limit 
may be reduced by up to five days if the notice is issued electronically. 
5.21.  A procuring entity shall provide to any interested supplier tender documentation including 
all necessary information and shall not require any technical specification for goods or services 
being procured that may create obstacles to trade between the Parties. Where technical specifications are indicated, these should be stated in terms of performance and functional 
requirements, rather than design or descriptive  characteristics and be based on international 
standards, and may be aimed at promoting the cons ervation of natural resources or to protect the 
environment (Article 9.6).  
5.22.  Where there are requirements that suppliers fulfil certain conditions for participation in 
procurement these should be limited to those that are essential to ensure that the supplier has the 
legal, financial and technical abilities to meet the requirements; be based on the global business 
activities of the supplier and on the conditions for participation provided in advance by the 
supplier; and permit all suppliers that satisfy the conditions to participate in the procurement 
activity. Procurement may also be based on a "multi-use list" inviting interested suppliers to apply for inclusion in the list: applications shall be possible at any time, and when a supplier satisfies the 
conditions for participation, may be included on the list within a reasonably short time 
(Article 9.7.4). Under Article 9.10, each Party may adopt or maintain procedures to declare 
                                               
36 As specified in Article 9.2.5, national treatment an d non-discrimination do no t apply to customs duties 
or charges of any kind imposed on or in connection with  importation, the method of levying such duties and 
charges, other import regulations or formalities, and measures affecting tr ade in services other than measures 
governing covere d procurements. 
37 The circumstances in which this period may be reduced up to a minimum of 10 days are where: 
(i) the entity has published a separate notice at least 40 days and not more than 12 months in advance; (ii) the entity procures commercial goods or services, except that the pr ocuring entity may not rely on this 
provision if it requires suppliers to satisfy conditions for participation; or (iii) in duly substantiated cases of 
extreme urgency caused by events unforeseeable by th e procuring entity and where the 40 day deadline would 
result in adverse consequences to the entity or to the relevant Party. WT/REG219/2/Rev.1 
 
- 45 - 
 
  ineligible for participation in its procurement, either indefinitely or for a specified time, suppliers 
that it has determined to have engaged in fraudulent or illegal actions in relation to procurement. The list of such suppliers and other relevant information shall be made available to the other Party on request. Under Article 9.8.2, a procuring entity may also contact a supplier or suppliers of its 
choice, providing that it is not intended to avoid competition, protect domestic suppliers, or 
to -discriminate against suppliers of the other Party, when: in response to a prior notice of intended procurement/invitation, no tenders were submitted or did not conform to essential 
requirements or satisfy conditions for participation; the goods or services can be supplied only by 
a particular supplier and no alternative goods or services exist; for additional deliveries of goods and services by the original supplier; for goods purchase on a commodity market; for procurement 
of a prototype, and when, for reasons of extrem e urgency brought about by events unforeseeable 
by the procuring entity, the goods or services could not be obtained in time.  
5.23.  The award for the contract must be publishe d no later than 60 days from the award decision 
(Article 9.9.7). Each Party shall provide the su pplier with "timely, effective, transparent and 
predictable means" to challenge the conduct of a covered procurement, through the establishment 
of at least one impartial and independent authority (Article 9.11). The authority shall be authorized to take prompt interim measures pending the resolu tion of challenges, including the suspension of 
the award or the performance of a contract (Article 9.11.4).  
5.24.  Exceptions to the government procurement provisions include measures adopted or 
maintained by the Parties to protect public morals, public order, or safety; human, animal, or plant life or health - including environmental measures-; intellectual property; or measures relating to 
goods or services of handicapped persons, of ph ilanthropic institutions, or of prison labour 
(Article 9.14).  
5.25.  The provisions of the Agreement apply for the United States to the same 52 central 
government and 7 other entities (List A and List B entities, respectively) as listed in its 
WTO GPA Appendix 1. Bahrain listed 28 central governmental entities and 17 other entities (only List A entities). Procurement of certain goods an d services by these entities furthermore is not 
subject to the requirements of Chapter 9 (Box 5.2). In addition, procurement of the following 
categories by the United States Department of Defence are excluded from the Agreement: nuclear 
ordnance; space vehicles; fibre optics materials, components, assemblies, and accessories; ammunition and nuclear ordnance boxes, packag es & special containers; there are additional 
exclusions for other government bodies and "other entities", as detailed in Box 5.2. For the 
United States, these exclusions partially reflect the exclusions indicated in its Appendix to the WTO GPA. 
Box 5.2 Goods and services excluded from Chapter 9, by entities 
Notes to Schedule of Bahrain 
 
1. Ministry of Interior, Ministry of Defence, and the National Guard : Goods: (a) Nuclear ordinance; 
Space vehicles; Ships, small craft, pontoons, and fl oating docks; Ship and ma rine equipment; Combat, 
assault & tactical vehicles, tracked; Hand tools; Measuring tools; Fibre optics materials, components, 
assemblies, and accessories; Ammuni tion & nuclear ordnance boxes, packages & special containers; 
(b) Weapons fire control equipment;  Ammunitions and explosives; Guided  missiles; Aircraft and airframe 
structural components; Aircraft components and accessories; Aircraft launching, landing, and ground 
handling equipment; Ships, small craft, pontoons, and floating docks; Ship and marine equipment, 
Engines, turbines, and components ; Bearings; Communications, detection, and coherent radiation; 
Electrical and electronic equipment components; Automa tic data processing equipment, software, supplies, 
and support equipment; Metal bars, sheets, and shapes (these items are generally excluded pursuant to 
Article 20.2 on Essential Security); Services: (a) Design, development, integration, testing, evaluation, 
maintenance, repair, modification, rebuilding and installation of military systems and equipment. 
2. Ministry of Foreign Affairs : goods and services for the construction  and operation of chanceries outside 
the territory of Bahrain.  
3. Ministry of Transportation : procurement by Civil Aviation Affairs. 
4. Radio & TV Corporation : acquisition, development, or produc tion of programmed material or the 
procurement of broadcasting time.  
 
 WT/REG219/2/Rev.1 
 
- 46 - 
 
  Notes to Schedule of the United States 
 
1. Department of Agriculture : agricultural goods in furtherance of agricultural support programs or human 
feeding programs. 
2. Department of Commerce : shipbuilding activities of the US  National Oceanic and Atmospheric 
Administration. 
3. Department of Defence: (a) Nuclear ordnance; Space vehicles; Ships, small craft, pontoons, and 
floating docks (classified as naval vessels or major components of the hull or superstructure thereof); Ship 
and marine equipment (classified as naval vessels or  major components of the hull or superstructure 
thereof); Buses for passenger; Combat, assault & tactical vehicles, tracked; Hand tools; Measuring tools; 
Fibre optics materials, components, assemblies, and accessories; Ammunition & nuclear ordnance boxes, 
packages & special containers; Textiles, leather, furs, apparel, shoes, tents, and flags (other than pins, 
needles, sewing kits, flagstaffs, fla gpoles and flagstaff trucks); Clothing, individual equipment, and insignia 
(other than luggage); Subsistence (other than tobacco products); (b) "Specialty metals," defined as steels 
melted in steel manufacturing facilities located in the United States or its possessions, where the 
maximum alloy content exceeds one or more of the follo wing limits, must be used in products purchased 
by the Department of Defence: (i) manganese, 1.65%; silicon, 0.60%; or copper, 0.60%; or which 
contains more than 0.25% of any of the following elements: aluminium, chromium, cobalt, columbium, 
molybdenum, nickel, titanium, tungsten , or vanadium; (ii) metal alloys consisting of nickel, iron-nickel, 
a n d  c o b a l t  b a s e  a l l o y s  c o n t a i n i n g  a  t o t a l  o f  o t h e r  a l l o y i n g  m e t a l s  ( e x c e p t  i r o n )  i n  e x c e s s  o f  1 0 % ;  ( i i i )  
titanium and titanium alloys; or (iv) zirconium base alloys; (c) Weapons fire control equipment; 
Ammunitions and explosives; Guided  missiles; Aircraft and airframe structural components; Aircraft 
components and accessories; Aircraft launching, landin g, and ground handling equipment; Ships, small 
craft, pontoons, and floating Docks; Ship and mari ne equipment; Engines, turbines, and components; 
Bearings; Communications, detection, and coherent radiation; Electrical and electronic equipment 
components; Metal bars, sheets, and shapes (these ar e generally excluded pursuant to Article 20.2 on 
Essential Security). 
4. Department of Energy : national security procurements made  in support of safeguarding nuclear 
materials or technology and entered into under the au thority of the Atomic Energy Act, or oil purchases 
related to the Strategic Petroleum Reserve. 
5. Department of Homeland Security: procurement by the Transportation  Security Administration. The 
essential security considerations applicable to the Department of Defence are equally applicable to the 
U.S. Coast Guard. 
6. Department of Transportation: procurement by the Federal Aviation Administration. 
7. General Services Administration: Hand tools; Measuring tools; Cutlery and flatware. 
8. United States Agency for International Development : procurement for the direct purpose of 
providing foreign assistance. 
9. The Rural Utilities Service: any restrictions on financing fo r telecommunications projects. 
10. Other Entities : restrictions attached to Fede ral funds for airport projects.  
Source: The Free Trade Agreement between the United States and Bahrain, Annexes 9-A-1 and 9-A-2. 
5.26.  Thresholds vary for different group of entiti es according to goods, services or construction 
services, and are subject to a "Threshold Adjustment Formula" (TAF) indicated in Annex 9-F. The 
thresholds for goods and services procurement by Central Government entities and by List B entities (i.e. Rural Utilities Services) in the United States Schedule are the US dollar equivalents of the thresholds indicated in Special Drawing Rights (SDRs) in its WTO GPA Appendix 1. These are: 
SDR 130,000 for goods and services procured by Central Government entities and SDR 400,000 
for goods and services procured by List B entities. Bahrain will benefit from a higher threshold of US$200,000 for procurement of goods and services  by central entities, and US$8 million for 
construction services, for a period of 2 years from the Agreement's entry into force. Bahrain's 
temporary threshold shall not be subject to the adjustment formula in Annex 9-F. 
5.27.  For construction services, the threshold is based on the US rate of inflation (measured by 
the Producer Price Index for finished goods of the US Bureau of Labor Statistics) over a two year WT/REG219/2/Rev.1 
 
- 47 - 
 
  period. It shall be adjusted every two years, with the first adjustment taking effect on 
January 1, 2006. The threshold for construction  services in the GPA is SDR 5 million. The 
United States shall notify Bahrain of the adjusted threshold values which will be converted into Bahraini Dinar at the official conversion rate of the Central Bank of Bahrain and be promptly 
notified to the United States.  
5.9  Intellectual Property Rights 5.28.  Provisions on intellectual property rights (IPRs) are set out in Chapter 14 and in three Side 
Letters between the Parties on the liability of se rvices providers, optical discs and public health, 
respectively, dated 14 September 2004.  
5.29.  The Agreement requires the Parties to ratify or accede to international treaties on 
intellectual property rights, including WIPO treaties
38,  a s  w e l l  a s  m a k e  b e s t  e f f o r t s  t o  r a t i f y  o r  
accede to the Patent Law Treaty (2000) and the Hague Agreement Concerning the International 
Registration of Industrial Designs. More extens ive protection and enforcement of IPRs may be 
provided by the Parties in their domestic laws (Article 4). The IPRs covered by the Agreement 
include: trademarks, geographical indications, copyright and related rights, and patents. The 
principle of national treatment applies to nationals39 of each Party with regard to the protection 
and enjoyment of such the rights under the Agr eement (Article 14.1.5). Each Party may derogate 
from the application of national treatment in relation to its judicial and administrative procedures, 
providing that it is necessary to secure compliance with laws and regulations that are not inconsistent with this Chapter; and it is not applied in a manner that would constitute a disguised restriction on trade (Article 14.1.6). National treatment does not apply to procedures under 
multilateral agreements under the auspices of th e World Intellectual Property Organization (WIPO) 
in relation to the acquisition or maintenance of IPRs (Article 14.1.7). Pursuant to Article 14.1.7, each Party shall ensure transparency in its la ws, regulations, and procedures concerning the 
protection or enforcement of IPRs.  
5.30.  With regard to trademarks, including geographical indications (Article 14.2), each Party shall 
provide a system for registration, including an electronic database available to the public, for no 
less than 10 years on a renewable basis. If a Party provides for the means to apply for protection 
or recognition of geographical indications (GIs), it must process applications or petitions for GIs with a minimum of formalities, make regulations governing filing of such applications or petitions made readily available to the public, and provide for a means of petition or opposition to a GI. 
Article 14.4 requires protection of copyright and re lated rights to be not less than the life of the 
author plus 70 years after the author's death if based on a natural person, or not less than 70 years from the end of the calendar year of the first authorized publication (or the creation) of 
the work, performance or phonogram (compared to not less than 50 years under the 
TRIPS Agreement). Protection of encrypted progra mme carrying satellite signals from unauthorized 
decoding activity is enforced through civil re medies, including compensatory damages, for any 
person injured by such activity, as well as through criminal penalties (Article 14.7).  
5.31.  With regard to patents, the Agreement permits the Parties to exclude from patentability 
inventions as necessary to protect ordre public or morality, including to protect human, animal, or 
plant life or health or avoid serious prejudice to the environment, provided that such exclusion is 
not made merely because the exploitation is prohibited by law. Each Party may also exclude from 
                                               
38 Article 2 includes: the Patent Cooperation Treaty (1970), as amended in 1979; the Convention 
Relating to the Distribution of Programme-Carrying Signals Transmitted by Satellite (1974); the Protocol 
Relating to the Madrid Agreement Concerning  the International Registration of Marks (1989); the Budapest 
Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure 
(1977), as amended in 1980; the International Convention for the Prot ection of New Varieties of Plants (1991) 
(UPOV Convention); the Trademark Law Treaty (1994); the WIPO Copyright Treaty (1996); and the 
WIPO Performances and Phonograms Treaty (1996). Article 3 includes: the Patent Law Treaty (2000); and the 
Hague Agreement Concerning the Internatio nal Registration of Industrial Designs (1999). Each Party shall 
ratify or accede the Convention Relating to the Distribution of  Programme-Carrying Signals Transmitted by 
Satellite (1974) and ); the Budapest Treaty on the International Recognition of the Deposit of Microorganisms 
for the Purposes of Patent Procedure (1977), as amended in 1980 within one year the Agreement's entry into 
force (Article 14.11.2). 
39 "National" of a Party shall also mean, in respect of the relevant right, an entity located in the Party 
that would meet the criteria for eligibility for protection  provided for in the agreements listed in Article 14.1.2 
and the TRIPS Agreement. WT/REG219/2/Rev.1 
 
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  patentability animals and diagnostic, therapeutic,  and surgical procedures for the treatment of 
humans or animals. However, patents shall be made available for plants and for any new uses or methods of using a known product, including products to be used for particular medical conditions, subject to the exclusions listed above and the conditions of patentability (Article 14.8). 
"Unreasonable" delays in granting the patent (over four years from the date of application or two 
years after the request for examination, whichever is the later) must be compensated through an 
adjustment of the term of patent protection, at the request of the patent owner. For 
pharmaceutical products, such an adjustment must also take into account the marketing approval 
process.
40 If information concerning the safety or efficacy of a pharmaceutical or agricultural 
chemical product is required to grant marketing approval for that product, including evidence 
concerning the safety or efficacy of a product that was previously approved in another territory, 
the Party shall not, without the consent of the person who submitted the request for approval, 
grant marketing approval to another person for the same or similar product for a period of five years for pharmaceuticals (three years where new clinical information is required for product that 
includes a chemical entity that has previous ly been approved for marketing in another 
pharmaceutical products) and 10 years for agricultural chemicals.  
5.32.  To enforce IPR protection, each Party shall publish final judicial decisions or administrative 
rulings of general applicability pertaining to IPR enforcement; make available to rights holders civil 
judicial procedures concerning the enforcement of any IPRs; establish or maintain a system of pre-established damages for copyright and related rights, as well as trademark counterfeiting; grant provisional measures, upon request, for relief inaudita altera parte expeditiously; and provide for 
criminal procedures and penalties to be applied at least in cases of wilful trademark counterfeiting 
or copyright or related rights piracy on a commercial scale (Article 14.10). With regard to border measures, each Party shall provide its competent authorities with the ability to initiate border 
measures ex officio with respect to imported, exported or in transit merchandise. Each Party shall 
also provide that where a Party's competent authorities have determined that goods are counterfeit or pirated, they shall be destroyed, except in exceptional cases the Party shall and not 
allow them to be exported or be subject to other customs procedures, except in exceptional 
circumstances (Article 14.10.20). The Parties shall provide for criminal procedures and penalties including imprisonment and monetary fines at least for wilful trademark counterfeiting and copyright and related rights piracy on a commerc ial scale. With respect to providing enforcement 
procedures for effective action against infringement of copyright, each Party shall also provide: 
legal incentives for service providers to cooperate with copyright owners in deterring the unauthorized storage and transmission of copyrighted materials; and limitations in its law 
regarding the scope of remedies available agains t service providers for copyright infringements 
that they do not control, initiate or direct (Article 14.10.29). 
5.33.  In the side letter on limitation on liability for services providers, Bahrain agrees to adopt 
requirements for (a) effective written notice to service providers with respect to materials that are 
claimed to be infringing IPRs and (b) effective written counter-notification by those whose material is removed or disabled and who claim that it was removed or disabled by mistake or misidentification. The Side Letter on optical discs requires Bahrain to grant licenses for the 
manufacture of optical discs and to mark such licenses with a manufacturer's code; to establish 
and maintain a register of the licenses granted; to carry out regular inspections and provide for 
fine or imprisonment in case of violations; and to prohibit trade in any optical discs that do not 
respect the licence's requirements.  
5.34.  The side letter on public health confirms the Parties' understanding that the obligations in 
Chapter 14 do not affect the ability of either Party to take necessary measures to protect public 
health by promoting universal access to medicines, in particular for illnesses such as HIV/AIDS, 
tuberculosis, malaria, and other epidemics as well as circumstances of extreme urgency or national emergency. Chapter 14 does not prevent the effe ctive utilization of the provisions on the 
TRIPS Agreement and public health, and in case  of amendments to the TRIPS Agreement which 
violate Chapter 14, the Parties shall immediately co nsult to adapt Chapter 14 as appropriate in the 
light of the amendment. 
                                               
40 In cases where the marketing approval process is  based on information concerning the safety and 
efficacy of the same or similar product in another te rritory, the extension shall also take into account the 
marketing approval process in the other territor y as well as in the Party (Article 14.8.6). WT/REG219/2/Rev.1 
 
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  5.10  Other 
5.10.1  Labour 5.35.  Under Chapter 15 on labour, the Parties reaffirm their obligations as members of the 
International Labour Organization (ILO), and strive to ensure that their labour laws are consistent 
with internationally recognized labour rights and are enforced through appropriate access to 
tribunals (Articles 15.1 and 15.3). The Agreement requires the Parties to effectively enforce labour laws that affect inter-Party trade while recognizing their right to exercise discretion with respect to 
investigatory, prosecutorial, regulatory or compliance matters, or decisions regarding the 
allocation of resources (Article 15.2.1). The Parties agree that it is inappropriate to weaken or reduce the level of labour protection in their domestic laws to encourage trade or investment (Article 15.2.2). 
5.36.  Annex 15-A establishes a labour cooperation mechanism between the Parties on any related 
matter, inter alia , social safety net programme; and enhancing procedures for admitting, 
regulating, and protecting foreign workers.  
5.37.  Institutional arrangements on labour issues are dealt with by the Joint Committee, which 
may establish a Subcommittee on Labour Affairs (the Subcommittee was established) in 2012), and contact points within the U.S. Department of  Labor's Office of Trade and Labor Affairs and 
Bahrain's Ministry of Labour, Office of International Relations (Article 15.4). 
5.38.  The Parties can consult each other on any matter under the Chapter and unresolved matters 
can be taken to the Subcommittee. If a Party considers that the other Party has not fulfilled its obligations under Article 15.2.1 (a), it can either initiate consultations under the 
Chapter (Article 15.6.1) or under the Agreement's Dispute Settlement procedures (Article 19.5). 
However, once consultations have been initiate d under Article 19.5, they cannot be requested 
under Article 15.6.1. 
5.10.2  Environment 
5.39.  Under Chapter 16, the Parties ensure that their domestic environmental laws and policies 
provide for high levels of environmental protection (Article 16.1) and recognize it to be 
inappropriate to encourage trade or investment by weakening or reducing the protections afforded 
by domestic environmental laws (Article 16.2.2).
41 They commit to encourage the development of 
voluntary mechanisms to enhance environmental performance by involving the private sector and local communities (Article 16.4). In the event of a violation of environmental laws, each Party shall 
ensure that interested persons have appropriate access to "judicial, quasi-judicial, or 
administrative proceedings", which shall be administrated in a "fair, equitable, and transparent" manner (Article 16.3). The Parties remain committed to multilateral environmental agreements to 
which they are both party, and recognize the im portance of current and future environmental 
cooperation that may be undertaken outside the Agreement.  
5.40.  With regard to the settlement of disput es, neither Party may have recourse to dispute 
settlement under the Agreement for any matter arising under Chapter 16 other than on the 
application and enforcement of environmental laws (paragraph 1 (a) of Article 16.2).
42 In all other 
cases, they have recourse to a consultation mechanism in the Subcommittee on Environmental Affairs under Article 16.8. If the Joint Committee has not established the Subcommittee as of the 
date a Party requests consultations, it shall do so during 30 days of the submission of the request. 
The Subcommittee has not yet been established. 
                                               
41 "Environmental law"  means any statute or regulation of a Party, or provision thereof, the primary 
purpose of which is the protection of the environment, or the prevention of a danger to human, animal, or 
plant life or health, through: (a) the prevention, abatemen t or control of the release, discharge, or emission of 
pollutants or environmental contaminants; (b) the cont rol of environmentally hazar dous or toxic chemicals, 
substances, materials, and wastes, and the dissemination of information related thereto; or (c) the protection or conservation of wild flora and fa una, including endangered species, their habitat, and specially protected 
natural areas, in areas with respect to which a Party exer cises sovereignty, sovereign rights, or jurisdiction, but 
does not include any statue or regula tion, or provision thereof, directly related to worker safety or health 
(Article 16.10). 
42 Article 16.8.5 of the Agreement. WT/REG219/2/Rev.1 
 
- 50 - 
 
  5.41.  The Parties will also undertake cooperative environmental activities pursuant to a 
"United States-Bahrain Memorandum of Understanding on Environmental Cooperation" and attached to the Agreement. The Memorandum highlights six areas of ongoing and future 
environmental cooperation: strengthening laws and regulations; improving impact assessments; 
encouraging incentives and voluntary programmes; developing projects and programmes on air 
quality; promoting public participation; and im proving the protection of water resources. The 
Parties established a "Joint Forum on Environmental Cooperation", comprised of their government 
representatives, which will meet regularly to discuss ways of cooperation to improve Bahrain's 
capacity to protect the environment. The Joint Foru m is expected to develop a Plan of Action and 
should consider any views and recommendations of the Joint Committee or any relevant subcommittee established under the FTA. The Parties are to develop ways in which the work of the 
Joint Committee and of the Joint Forum can inform one another. 
 WT/REG219/2/Rev.1 
 
- 51 - 
 
  ANNEX 1 
DETAILS OF THE TARIFF LIBERALIZATION UNDER THE AGREEMENT  
1. A comparison between the scheduled elimination of tariffs applied to the Parties' mutual 
imports and the MFN rates applied by the United States and Bahrain is shown in Tables A1.1 
(the United States) and A1.2 (Bahrain) below, by total products, agricultural products and 
non-agricultural products. 
2. The United States' average applied MFN rate in 2006 was 4.3%; the average applied tariff 
on agricultural products was higher at 8%, co mpared to 3.8% for non-agricultural products. 
Duty-free tariff lines account for 4.3% of all tari ff lines. In 2006 when the Agreement entered into 
force Bahrain's exporters enjoyed an absolute margin  of preference for agricultural goods of 4.9%. 
For non-agricultural goods, the average applied tariff fell to 0.1%, giving Bahraini exporters an 
absolute margin of preference of 3.7%. Overall, Bahrain's exporters enjoyed an absolute margin of 
preference of 3.8% vis-à-vis  the prevailing average applied MFN tariff. By the end of 
implementation 100% of tariffs and trade are due to be covered by the Agreement. 
Table A1.1 United States: Indicators of MFN tariff rates and preferential rates for 
imports from Bahrain 
Origin 
of 
goods Year ALL PRODUCTS Agricultural productsa Non-agricultural products 
Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) 
MFN 2006 4.3 7.2 37.6 8.0 12.7 23.4 3.8 6.5 40.3 
Bahrain 2006 0.5 24.7 96.6 3.1 26.0 80.8 0.1 18.2 99.6 
 2007 0.5 21.6 96.6 2.7 22.8 80.8 0.1 16.2 99.6 
 2008 0.4 18.6 96.6 2.3 19.5 80.8 0.1 14.2 99.6 
 2009 0.3 15.5 96.6 1.9 16.2 80.8 0.1 12.2 99.6 
 2010 0.3 16.2 97.3 1.5 18.0 85.0 0.0 10.1 99.6 
 2011 0.2 13.0 97.3 1.2 14.4 85.0 0.0 8.1 99.6 
 2012 0.2 9.7 97.3 0.9 10.8 85.0 0.0 6.1 99.6 
 2013 0.1 6.5 97.3 0.6 7.2 85.0 0.0 4.1 99.6 
 2014 0.1 3.2 97.3 0.3 3.6 85.0 0.0 2.0 99.6 
 2015 0.0 0.0 100.0 0.0 0.0 100.0 0.0 0.0 100.0 
a WTO Definition. 
Note: For tariff lines subject to TRQs only the out-of-quota duty is included in the tariff-related 
calculations; lines with sp ecific duties and the non- ad valorem component of lines with compound 
and alternate rates are excluded from the calculations; excludes data beyond HS Chapter 97. 
Source: WTO Secretariat estimates based on data provided by USA and the WTO-TPR  
3. Bahrain's average applied MFN rate in 2006 was 5.3%; as for the United States, the average 
applied tariff on agricultural products was higher at 7.4%, compared to 4.9% for non-agricultural 
products. Duty-free tariff lines on an MFN basis accounted for 5.9% of all tariff lines. At the entry 
into force of the Agreement, exporters from the United States to Bahrain enjoyed an absolute 
margin of preference for agricultural goods of 2.8%, with an average tariff rate of 3.6%. For 
non-agricultural goods, the average applied tariff was 0.1%, with a substantive absolute 
preferential margin of 4.8%. Overall, the United States' exporters enjoyed an absolute margin of 
preference of 4.7% vis-à-vis  the prevailing average applied MFN tariff. By the end of 
implementation in 2015, all of Bahrain's tariffs ar e expected to become duty free although 16 lines 
may be subject to import prohibition. WT/REG219/2/Rev.1 
 
- 52 - 
 
  Table A1.2 Bahrain: Indicators of MFN tariff rates and preferential rates for imports from 
the United States 
Origin 
of 
goods Year ALL PRODUCTS Agricultural productsaNon-agricultural 
products 
Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) 
MFN 2006 5.3 5.7 5.9 7.4 9.4 20.7 4.9 5.1 3.2 
USA 2006 0.6 70.2 98.8 3.6 111.5 95.7 0.1 17.6 99.4 
 2007 0.6 69.4 98.8 3.6 111.5 95.7 0.1 15.6 99.4 
 2008 0.6 68.5 98.8 3.6 111.5 95.7 0.1 13.7 99.4 
 2009 0.6 67.7 98.8 3.6 111.5 95.7 0.1 11.8 99.4 
 2010 0.6 66.8 98.8 3.6 111.5 95.7 0.0 9.8 99.4 
 2011 0.6 66.0 98.8 3.6 111.5 95.7 0.0 7.9 99.4 
 2012 0.6 65.1 98.8 3.6 111.5 95.7 0.0 6.0 99.4 
 2013 0.6 64.3 98.8 3.6 111.5 95.7 0.0 4.0 99.4 
 2014 0.6 63.0 98.8 3.6 110.8 95.7 0.0 2.1 99.4 
 2015 0.0 0.0 99.8 0.0 0.0 98.9 0.0 0.0 99.9 
a WTO Definition. 
Note: Calculation excludes specific rates and include the ad valorem  part of compound rates. 
Source: WTO Secretariat estimates based on data provided by Bahrain and the WTO-TPR (2006). 
4. Table A1.3 and A1.4 show the market access cond itions in the United States and Bahrain for 
their respective top 25 exports (aggregated at the HS 6-digit level). The United States represented 
an important market for Bahrain's top 25 exports, which accounted for 95.8% of its global export 
during the period surveyed. The main category wa s light oils and preparations with a share of 
73.9% in Bahrain's global exports. Thirteen tariff lines at the HS 8-digit level were duty-free on an 
MFN basis. All 37 tariff lines which were dutiable became duty-free upon the entry into force of the 
Agreement. 
Table A1.3 United States: Market acce ss opportunities under the agreement for 
Bahrain's top 25 exports 
Bahrain's top export products in 2003-2005 Access Conditions to USA's import 
markets 
MFN (2006) Duty-
free 
in Average 
MFN 
applied 
rate 
(%) Number of tariff 
lines 
HS number and description of the product Share in global 
exports (%) Duty-
free Dutiable 2006 
271011 Light oils and preparations 73.9 7.0  5 5 
760429 Other 6.7 3.5  3 3 
260112 Agglomerated 2.6 0.0 1   
760611 Of aluminium, not alloyed 2.1 2.9  2 2 
620462 Of cotton 1.5 8.2 1 3 3 
760410 Of aluminium, not alloyed 1.5 3.5  3 3 
310210 Urea, whether or not in aqueous 
solution 1.3 0.0 1   
290511 Methanol (methyl alcohol) 0.8 2.8 1 1 1 
760110 Aluminium, not alloyed 0.8 1.3 1 1 1 
870324 Of a cylinder capacity exceeding 
3,000 cc 0.6 2.5  1 1 
760421 Hollow profiles 0.6 1.5  1 1 
760511 Of which the maximum cross-
sectional dimension exceeds 7 mm 0.5 2.6  1 1 
520921 Plain weave 0.5 7.7  1 1 
870323 Of a cylinder capacity exceeding 
1,500 cc but not exceeding 3,000 cc 0.3 2.5  1 1 
620342 Of cotton 0.3 9.0 1 2 2 
841510 
 Window or wall types, self-
contained or "split-system" 0.2 1.1 1 2 2 WT/REG219/2/Rev.1 
 
- 53 - 
 
  Bahrain's top export products in 2003-2005 Access Conditions to USA's import 
markets 
MFN (2006) Duty-
free 
in Average 
MFN 
applied 
rate 
(%) Number of tariff 
lines 
HS number and description of the product Share in global 
exports (%) Duty-
free Dutiable 2006 
480300 Toilet or facial tissue stock, towel or 
napkin stock and similar paper of a 
kind used for household or sanitary 
purposes, cellulose wadding and 
webs of cellulose fibres, whether or 
not creped, crinkled, embossed, 
perforated, surface-coloured, 
surface-decorated or printed, in 
rolls or sheets. 0.3 0.0 2   
760310 Powders of non-lamellar structure 0.2 5.0  1 1 
281420 Ammonia in aqueous solution 0.2 0.0 1   
330300 Perfumes and toilet waters. 0.2 0.0 3   
520513 Measuring less than 232.56 decitex 
but not less than 192.31 decitex 
(exceeding 43 metric number but 
not exceeding 52 metric number) 0.2 6.9  2 2 
391723 Of polymers of vinyl chloride 0.2 3.1  1 1 
761410 With steel core 0.2 4.9  2 2 
392350 Stoppers, lids, caps and other 
closures 0.2 5.3  1 1 
760711 Rolled but not further worked 0.1 4.7  3 3 
Total of above 95.8  13 37 37 
Source: WTO estimates based on data provided by USA, WTO-TPR (2007) and UNSD, Comtrade database. 
5. The United States' top 25 exports accounted for 27.5% of its global exports to Bahrain over 
the period 2003-2005. Ten tariff lines were already duty-free on an MFN basis before the 
Agreement entered into force. Almost all the tariff lines which were dutiable became duty-free upon the entry into force of the Agreement (88 ou t of 89); the last remaining dutiable line which 
relates to other instruments and appliances is to become duty-free in 2015. 
Table A1.4 Bahrain: Market access opport unities under the agreement for USA's top 25 
exports 
USA's top export products in 2003-2005 Access Conditions to Bahrain's import 
markets 
MFN (2006) Duty-free 
in Average 
MFN 
applied 
rate 
(%) Number of 
tariff lines 
HS number and description of the product Share in 
global 
exports (%) 
Duty-free 
Dutiable 
2006 
2015 
854221 Digital 3.7 5.0  1 1  
880240 Airplanes and other aircraft, of an 
unladen weight exceeding 15,000 kg 2.8 0.0 1    
847330 Parts and accessories of the 
machines of heading 84.71 2.2 5.0  1 1  
880330 Other parts of airplanes or 
helicopters 1.7 5.0  1 1  
870323 Of a cylinder capacity exceeding 
1,500 cc but not exceeding 3,000 cc 1.6 5.0  9 9  
870324 Of a cylinder capacity exceeding 
3,000 cc 1.3 5.0  8 8  
870899 Other 1.3 5.0  1 1  
300490 Other 1.1 0.0 2    
870829 Other 1.1 5.0  2 2  
854229 Other 1.0 5.0  1 1  
841191 Of turbo-jets or turbo-propellers 1.0 5.0  1 1  
120100 Soya beans, whether or not broken. 0.9 5.0  2 2  
271019 Other 0.9 5.0  15 15  
710239 Other 0.8 5.0  1 1  
100590 Other 0.6 0.0 4    WT/REG219/2/Rev.1 
 
- 54 - 
 
  USA's top export products in 2003-2005 Access Conditions to Bahrain's import 
markets 
MFN (2006) Duty-free 
in Average 
MFN 
applied 
rate 
(%) Number of 
tariff lines 
HS number and description of the product Share in 
global 
exports (%) 
Duty-free 
Dutiable 
2006 
2015 
847180 Other units of automatic data 
processing machines 0.6 5.0  1 1  
901890 Other instruments and appliances 0.6 6.7  9 8 1 
843143 Parts of boring or sinking machinery 
of subheading 8430.41 or 8430.49 0.6 5.0  1 1  
847989 Other 0.6 5.0  13 13  
870431 g.v.w. not exceeding 5 tonnes 0.6 5.0  9 9  
852520 Transmission apparatus incorporating 
reception apparatus 0.5 5.0  9 9  
100190 Other 0.5 0.0 3    
847160 Input or output units, whether or not 
containing storage units in the same 
housing 0.5 5.0  1 1  
851790 Parts 0.5 5.0  2 2  
852990 Other 0.5 5.0  1 1  
Total of above 27.5  10 89 88 1 
Source: WTO estimates based on data provided by Bahrain, WTO-TPR (2007) and UNSD, Comtrade 
database. WT/REG219/2/Rev.1 
 
- 55 - 
 
  ANNEX 2 
TARIFF RATE QUOTAS UNDER THE AGREEMENT  
Table A2.1 United States Tariff-rate quotas in favour of Bahrain's suppliers under the 
Agreement, agricultural products 
HS tariff line code (description) Base out-of-
quota duty In-quota quantity In-
quota 
duty Date 
quota 
removed 
Bovine meat fresh, chilled or 
frozen     
02011050, 02012080, 02013080, 
02021050, 02022080, 02023080  
 26.4% 15 metric tonnes (MT) in 2006, 
plus approximately 10% 
compounded annually (c.a.) 
every year thereafter; unlimited 
in 2015. 0 2015 
Dairy products (liquid)     
04013025, 04039016  77.2 
cents/litre; 1,000 litres in 2006, plus 
approximately 10% c.a. every 
year thereafter; unlimited in 
2015. 0 2015 
21050020  
 50.2 cents/kg 
+ 17%   
Cheese      
04061008, 04061088, 04062091, 
04063091, 04069097 US$1.509/kg 15 MT, plus 9% c.a. every year 
thereafter, unlimited in 2015. 0 2015 
04061018, 04062028, 04062063, 
04063018, 04063063, 04064070, 
04069074 US$2.269/kg   
04061028, 04062033, 04062067, 
04063028, 04063067, 04069012, 04069078,  US$1.227/kg   
04061038, 04062039, 04062071, 
04063038, 04063071, 04069054, 
04069084,  US$1.055/kg   
04061048, 04062048, 04062075, 
04063048, 04063075, 04069018, 04069088,  US$1.803/kg   
04061058, 04062053, 04062079, 
04063079, 04069032, 04069037, 
04069042, 04069068,  US$2.146/kg   
04061068, 04062083, 04063053, 
04063083, 04069092 US$1.386/kg   
04061078, 04062087, 04063087, 
04069094, 19019036 US$1.128/kg   
04069048 US$1.877/kg   
Milk powder      
23099028, 23099048  US$0.8/kg + 
6.4% 5 MT, plus approximately 10% 
c.a. every year thereafter; unlimited in 2015. 0 2015 
04021050, 04022125 86.5cents/kg   
04022150, 04039055 US$1.092/kg   
04039045 87.6cents/kg   
Butter     
04013075, 04039078 US$1.646/kg 5 MT, plus approximately 10% 
c.a. every year thereafter, 
unlimited in 2015. 0 2015 
04022190, 04039065 US$1.556/kg   
04051020 US$1.541/kg   
04052030, 21069026, 21069036 US$1.996/kg   
04059020 US$1.865/kg + 
8.5%   
Other dairy products     
04022950 US$1.104/kg + 
14.9% 5 MT, plus approximately 10% 
c.a. every year thereafter, 
unlimited in 2015.  
 0 2015 
04029170, 04029190 31.3 cents/kg   
04029945, 04029955 49.6 cents/kg   
04029990 46.3 cents + 
14.9%   
04031050 US$1.035/kg + 
17%   
04039095 US$1.035/kg + 
17%   
04041015 US$1.035/kg + 
8.5%   WT/REG219/2/Rev.1 
 
- 56 - 
 
  HS tariff line code (description) Base out-of-
quota duty In-quota quantity In-
quota 
duty Date 
quota 
removed 
04049050 US$1.189/kg + 
8.5%   
04052070, 21069066 70.4 cents + 
8.5%   
15179060 34.2 cents/kg   
17049058 40 cents/kg + 
10.4%   
18062026, 18062036, 18063206, 18063216 37.2 cents/kg 
+ 4.3%   
18062028, 18062038, 18063208, 
18063218 52.9 cents/kg 
+ 4.3%   
18062082, 18063208 37.2 cents/kg 
+ 8.5%   
18062083, 18062089 52.8 cents/kg 
+ 8.5%   
18063270, 18069008, 18069018, 18069028 37.2 cents/kg 
+ 6%   
18063280, 18069010, 18069020, 
18069030 52.8 cents/kg 
+ 6%   
19011030, 19011040, 19011075, 19011805 US$1.035/kg + 
14.9%   
19012015, 19012050 42.3 cents/kg 
+ 8.5%   
19019043, 19019047 US$1.035 + 
13.6%   
21050040 50.2 cents + 
17%   
21069009 86.2 cents/kg   
21069087 28.8 cents/kg 
+ 8.5%   
22029028 23.5 cents/litre 
+ 14.9%   
Peanuts     
12022080, 20081115, 20081135, 20081160  131.8% 1 MT, plus approximately 10% 
c.a. every year thereafter, unlimited in 2015 0 2015 
12021080 163.8%   
    
Sugar and sugar-containing 
products      
1701115 33.87 cents/kg 15 MT, plus approximately 5% 
c.a. every year thereafter, unlimited in 2015 0 2015 
17011250, 17019130, 17019950, 
17029020, 21069046 35.74 cents/kg   
18061015 21.7 cents/kg   
18061028, 18061038, 18061055, 
18061075 33.6 cents/kg   
17022028, 17023028  16.9 cents/kg 
of total sugars + 5.1%   
17024028, 17026028, 17029058, 
17029068 33.9 cents/kg 
of total sugars 
+ 5.1%   
17049058, 17049068, 17049078 40 cents/kg + 
10.4%   
18062093, 18062077 30.5 cents/kg 
+ 8.5%   
18062094, 18062098, 18069039, 
18069049, 18069059 37.2 cents/kg 
+ 8.5%   
19012070 42.3 cents/kg 
+ 8.5%   
19019054, 19019058 23.7 cents/kg 
+ 8.5%   
21011238, 21011248, 21011258, 
21012038, 21012048, 21012058 30.5 cents/kg 
+ 8.5%   
21039078 30.5%/kg + 
6.4%   
21069072, 21069076, 21069080 70.4 cents + 
8.5%   
21069091, 21069094, 21069097 28.8 cents/kg 
+ 8.5%   WT/REG219/2/Rev.1 
 
- 57 - 
 
  HS tariff line code (description) Base out-of-
quota duty In-quota quantity In-
quota 
duty Date 
quota 
removed 
Cotton     
52010018, 52010028, 52010038, 
52010080, 52030030  31.4 cents/kg 5 MT, plus approximately 10% 
c.a. every year thereafter 
unlimited in 2015 0 2015 
52029930 7.8 cents/kg   
Tobacco     
24011065, 24012035, 24012087, 
24013070, 24031090, 24039147, 
24039990 350% 5 MT, plus approximately 10% 
c.a. every year thereafter, 
unlimited in 2015 0 2015 
c.a. Compounded annually. 
Source: WTO estimates, based on the Agreement and on information provided by the United States. 
 WT/REG219/2/Rev.1 
 
- 58 - 
 
  ANNEX 3 
LIST OF PROHIBITED LINES COVERED UNDER THE AGREEMENT 
Table A3.1 Bahrain: prohibited products whose  tariffs are due to be phased out by 2015 
under the Agreement 
HS code Description Base Category 
2006 
2007 
2008 
2009 
2010 
2011 
2012 
2013 
2014 
2015 
12079100 Poppy seeds 5% A 0 0 0 0 0 0 0 0 0 0 
22072019 Other 5% A 0 0 0 0 0 0 0 0 0 0 
25240000 Asbestos 5% A 0 0 0 0 0 0 0 0 0 0 
29399190 Other 5% A 0 0 0 0 0 0 0 0 0 0 
29399900 Other 5% A 0 0 0 0 0 0 0 0 0 0 
40121100 Of kind used on 
motor cars 
(including station 
wagons and 
racing cars) 5% H 5 5 5 5 5 5 5 5 5 0 
40121200 Of a kind used on 
buses or lorries 5% A 0 0 0 0 0 0 0 0 0 0 
40121300  Of a kind used 
on aircraft 5% A 0 0 0 0 0 0 0 0 0 0 
40121900 Other 5% A 0 0 0 0 0 0 0 0 0 0 
40122000 Used pneumatic 
tyres 5% A 0 0 0 0 0 0 0 0 0 0 
40129000 Other 5% A 0 0 0 0 0 0 0 0 0 0 
68111000 Corrugated 
sheets 5% A 0 0 0 0 0 0 0 0 0 0 
68112000 Other sheets, 
panels, Tiles and similar articles 5% A 0 0 0 0 0 0 0 0 0 0 
68113010 Ventilating Pipes 
and the like 5% A 0 0 0 0 0 0 0 0 0 0 
68113020 Conduits 5% A 0 0 0 0 0 0 0 0 0 0 
68113030 Pipe joints and 
washers 5% A 0 0 0 0 0 0 0 0 0 0 
68113090 Other 5% A 0 0 0 0 0 0 0 0 0 0 
68119010 Tanks 5% A 0 0 0 0 0 0 0 0 0 0 
68119020 Basins Fixed 
bathroom equipment 5% A 0 0 0 0 0 0 0 0 0 0 
68119030 Vases 5% A 0 0 0 0 0 0 0 0 0 0 
68119090 Other 5% A 0 0 0 0 0 0 0 0 0 0 
68125000 Clothing, 
Clothing 
accessories, 
footwear and 
headgear 5% A 0 0 0 0 0 0 0 0 0 0 
68126000 Paper, millboard 
and felt 5% A 0 0 0 0 0 0 0 0 0 0 
68127000 Compressed 
asbestos fibre 
jointing, in 
sheets or rolls 5% A 0 0 0 0 0 0 0 0 0 0 
68129010 Filter blocks and 
table mats 5% A 0 0 0 0 0 0 0 0 0 0 
68129020 Iron spheres and 
cones coated 
with asbestos for 
fighting fire In 
gas mains 5% A 0 0 0 0 0 0 0 0 0 0 
68129090 Other 5% A 0 0 0 0 0 0 0 0 0 0 
68131000 Brake linings and 
pads 5% A 0 0 0 0 0 0 0 0 0 0 
68139000 Other 5% A 0 0 0 0 0 0 0 0 0 0 WT/REG219/2/Rev.1 
 
- 59 - 
 
  HS code Description Base Category 
2006 
2007 
2008 
2009 
2010 
2011 
2012 
2013 
2014 
2015 
71161010 Articles of 
personal 
ornamentation 5% A 0 0 0 0 0 0 0 0 0 0 
85252090 Other  5% A 0 0 0 0 0 0 0 0 0 0 
85438930 Electrical mine 
detonators  5% A 0 0 0 0 0 0 0 0 0 0 
87083100 Mounted brake 
linings 5% A 0 0 0 0 0 0 0 0 0 0 
87149400 Brakes, including 
coaster braking 
hubs and hub 
brakes, and parts 
thereof 5% A 0 0 0 0 0 0 0 0 0 0 
95038000 Other toys and 
models, Incorporating a motor 5% A 0 0 0 0 0 0 0 0 0 0 
95039000 Other 5% A 0 0 0 0 0 0 0 0 0 0 
96019000 Other 5% A 0 0 0 0 0 0 0 0 0 0 
Source: Bahrain authorities.  
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