RESTRICTED  
  
G/C/M/129  
 
8 November 2017  
(17-6100) Page: 1/45 
Council  for Trade in Goods    
 
MINUTES OF THE MEETI NG OF THE COUNCIL FO R TRADE IN GOODS  
30 JUNE 2017  
CHAIRPERSON: HE MR KYONGLIM  CHOI  
The meeting of the Council for Trade in Goods (CTG, or the C ouncil) was convened by 
Airgram  WTO/AIR/CTG/8 ; the proposed agenda for the mee ting was circulated in 
document  G/C/W/739 . The meeting proceeded on the basis of the following agenda:  
 
1   NOTIFICATION OF REGI ONAL TRADE AGREEMENT S ................................ ....................  2 
1.1   Accession of Ecuador to the Trade Agreement Between the European Union and 
Colombia and Peru (WT/REG380/N/1)  ................................ ................................ ...................  2 
1.2   Economic Partnership Agreement Between the European Union and the SADC 
EPA States (WT/REG381/N/1)  ................................ ................................ ..............................  2 
1.3   Economic Partnership Agreement Between the European Union and Ghana 
(WT/REG382/N/1)  ................................ ................................ ................................ ...............  2 
1.4   Free Trade Agreement Between the Republic of Moldova, Azerbaijan, Georgia and 
Ukraine (GUAM)(WT/REG383/N/1)  ................................ ................................ ........................  2 
1.5   Accession of Panama to the Central American Common Market (CACM) 
(WT/REG384/N/1)  ................................ ................................ ................................ ...............  2 
1.6   Free Trade Agreement Between the Eurasian Economic Union (EAEU) and Viet Nam 
(WT/REG385/N/1)  ................................ ................................ ................................ ...............  2 
2   ACCESSION OF THE KYR GYZ REPUBLIC TO THE EURASIAN ECONOMIC 
UNION: PROCEDURES UN DER ARTICLE  XXVIII:3 OF GATT  1994 – REQUEST 
FROM THE KYRGYZ REPU BLIC  ................................ ................................ ..........................  3 
3   ACCESSION OF THE R EPUBLIC OF ARMENIA T O THE EURASIAN ECONO MIC 
UNION: PROCEDURES UN DER ARTICLE  XXVIII:3 OF GATT  1994 – REQUEST 
FROM THE EUROPEAN UN ION ................................ ................................ ..........................  4 
4   JORDAN – REQUEST FOR A WAIVER  RELATING TO THE TRAN SITIONAL 
PERIOD FOR THE ELIMI NATION OF THE EXPORT  SUBSIDY PROGRAMME FO R 
JORDAN (G/C/W/705; G /C/W/705/CORR.1; G/C /W/705/REV.1; AND 
G/C/W/705/REV.2)  ................................ ................................ ................................ .........  5 
5   TRADE RESTRICTIVE ME ASURES BY CERTAIN ME MBERS – REQUEST FROM 
QATAR  ................................ ................................ ................................ ..............................  6 
6   NIGERIA – IMPORT RESTRICTING P OLICIES AND MEASURES  – REQUEST 
FROM NORWAY AND THE UNITED STATES OF AME RICA  ................................ ...................  8 
7   BRAZIL – MEASURES RESTRICTING  SHRIMP IMPORTS – REQUEST FROM 
ECUADOR  ................................ ................................ ................................ .........................  9 
8   INDONESIA'S IMPORT A ND EXPOR T RESTRICTING POLICI ES AND PRACTICES 
– REQUEST FROM THE EUR OPEAN UNION, JAPAN, AND THE UNITED STATE S OF 
AMERICA  ................................ ................................ ................................ ........................  11 
9   BRAZIL – MEASURES RESTRICTING  BANANA IMPORTS – REQUEST FROM 
ECUADOR  ................................ ................................ ................................ .......................  14 G/C/M/129  
 
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  10   INDIA – IMPORT RESTRICTING M EASURES – REQUEST FROM CANADA,  THE 
EUROPEAN UNION, NORW AY, JAPAN, AND THE U NITED STATES OF AMER ICA ...............  15 
11   EGYPT – MANUFACTURER REGISTR ATION SYSTEM – REQUEST FROM T HE 
EUROPEAN UNION AND T HE UNITED STATES OF AMERICA  ................................ ............  18 
12   IMPORT LEVY BY WTO M EMBERS OF THE AFRICA N UNION – REQUEST FROM 
JAPAN AN D THE UNITED STATES OF AMERICA  ................................ ...............................  20 
13   CHINA – TRADE DISTORTING MEA SURES – REQUEST FROM THE UNI TED 
STATES OF AMERICA  ................................ ................................ ................................ ...... 21 
14   THE RUSSIAN FEDERATI ON – TRADE RESTRICTING PR ACTICES: EXPORT 
BANS, CEMENT STANDAR DS, GMP  CERTIFICATES – REQUEST FROM THE 
EUROPEAN UNION  ................................ ................................ ................................ .........  25 
15   UKRAINE – ANTI -DUMPING MEASURES ON IMPORTS OF CERTAIN 
NITROGEN FERTILIZERS  ORIGINATING IN THE R USSIAN FEDER ATION – 
REQUEST FROM THE RUS SIAN FEDERATION  ................................ ................................ .. 27 
16   UNITED STATES OF AME RICA – SECTION  232 INVESTIGATIONS O N THE 
EFFECT OF IMPORT S OF STEEL AND ALUMI NIUM PRODUCTS ON US  NATIONAL 
SECURITY – REQUEST FROM THE RUS SIAN FEDERATION  ................................ ...............  28 
17   UNITED STATES OF AME RICA – TRADE DISTORTING MEA SURES – REQUEST 
FROM THE PEOPLE'S RE PUBLIC OF CHINA  ................................ ................................ ..... 31 
18   TEMPORARY ADMISSION OF CONTAINERS, PALLE TS AND PACKING 
MATERIALS – COMMUNICATION FROM A USTRALIA (G/C/W/738)  ................................  34 
19   WORK PROGRAMME ON EL ECTRONIC COMMERCE  ................................ ...................  37 
20   OTHER BUSINESS  ................................ ................................ ................................ .... 45 
 
At the start of the meeting the Chairperson  announced that he would refer to t he date of the next 
CTG meeting under the agenda item "Other Business".  
 
The agenda was so agreed . 
 
1  NOTIFICATI ON OF REGIONAL TRADE  AGREEMENTS  
1.1.  The Chairperson  recalled that, under  the working procedures agreed by the Committee on 
Regional Trade Agreements (CRTA), and following adoption by the General Council of the 
Transparency Mechanism, the CTG was to be kept informed of Members' notifications of new 
regional trade agreements.1 He informed the CTG that the following trade agreements had been 
notified to the CRTA:  
1.1  Accession of Ecuador to the Trade Agreement Between the European Union and 
Colombia and Peru (WT/REG380/N/1)  
1.2  Economic Partnership Agreement Between the European Union and  the SADC  
EPA States (WT/REG381/N/1)  
1.3  Economic Partnership Agreement Between the European Union and Ghana 
(WT/REG382/ N/1) 
1.4  Free Trade Agreement Between the Republic of Moldova, Azerbaijan, Georgia  and 
Ukraine (GUAM)(WT/REG383/ N/1) 
1.5  Accession of Panama to the Central American Common Market (CACM) 
(WT/REG384/N /1) 
1.6  Free Trade Agreement Between the Eurasian Economic Union (EAEU) and Viet Nam 
(WT/REG385/N/1)  
                                                
1 See documents  WT/REG16 , WT/L/671 , and G/C/M/88 . G/C/M/129  
 
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  1.2.  The delegate of the United States of America  thanked the parties to the previous agreements 
for their notifications, and took the opportunity to again encourage those Members that had not 
yet notified Free Trade Agreements (FTAs) to which they were signatories to do so as quickly as 
possible so that  Members could all benefit from the transparency mandated under the 
WTO Transparency Mechanism for Regional Trade Agreements.  
1.3.  The Chairperson  proposed that the Council take note of the statement made and of the 
information provided.  
1.4.  The Council so agreed . 
2  ACCESSION OF THE KYR GYZ REPUBLIC TO THE EURASIAN ECONOMIC UN ION: 
PROCEDURES UNDER ART ICLE  XXVIII:3 OF GATT  1994  – REQUEST FROM THE KYR GYZ 
REPUBLIC  
2.1.  The Chairperson  informed the Council that , in a communication dated 16  June 2017, the 
delegation of the Kyrgy z Republic had requested the Secretariat to include this issue  on the 
agenda.  
2.2.  The delegate recalled that, at a previous meeting, the Council had approved the extension of 
the deadline for interested Members to withdraw substantially equivalent concessions until 
12 February  2018 so as to ensure that Members' rights remained preserved pendi ng the 
communication to the WTO  Secretariat of the agreements  reached in the context of 
GATT  Article XXIV:6 negotiations. His delegation stood ready to communicate further with relevant 
partners so as to proceed on the basis of a mutually beneficial cooperation.  
2.3.  The delegate of the Kyrgyz Republic  updated the Council on the processes under 
GATT Articles  XXIV:6 and XXVIII following modification of the Kyrgyz Republic's conces sions as a 
result of its accession to the Eurasian Economic Union (EAEU). The Kyrgyz Republic was continuing 
its informal consultations with those Members that had reserved their negotiating rights, clarifying 
and analysing statistical as well as other rel evant data submitted in their claims of interest. The 
Kyrgyz Republic continued to carry out an inter -governmental coordination exercise in order to 
finalize its responses to the claims of interest that had been submitted, and would respond to 
those claims  subject to consultations with and to the internal approval of its partners in the EAEU. 
He asked interested Members to be understand ing with regard to  these procedures and gave 
assurances  that the Kyrgyz Republic would keep interested Members infor med of further 
developments.  
2.4.  The delegate of the European Union  thanked the Kyrgyz Republic for the updated information 
on this issue but expressed deep concern about the lack of progress in the renegotiation process. 
The EU had already stated in this Council that since it had submitted its claim of interest, more 
than 15  months ago, the EU had still not received an answer that would allow it to engage in 
substantial ne gotiations with the Kyrgyz Republic. Unfortunately this situation had not changed 
since the last CTG  meeting. She urged the Kyrgyz Republic and Armenia not to delay the 
negotiations any further but rather to submit without delay an offer from Armenia, the Kyrgyz 
Republic, Kazakhstan, and the Russian Federation,  in reply to the EU  requests. Her delegation 
looked forward to resuming negotiations on that basis in earnest and stood available for bilateral 
rounds of negotiations. Otherwise, the EU would raise th is issue again at the CTG and at the 
General Council.  
2.5.  The delegate of Ukraine  emphasized the need to maintain a reliable, predictable , and 
mutually beneficial trading relationship between Ukraine and the Kyrgyz Republic and Armenia , 
particularly following their accession to the EAEU. He reiterated Ukraine's interest in the 
renegotiation process under Article  XXVIII of GATT  1994, and recalled that trade between Ukraine 
and these two countries was currently governed by bilateral free trade agreements and by t he 
Agreement on the Commonwealth of Independent States Free Trade Area. Since Ukrainian exports 
could be affected by the integration process within the EAEC, Ukraine would closely follow the 
evolution of the renegotiation process. Armenia and the Kyrgyz Republic should strictly foll ow the 
rules prescribed in GATT  Article  XXVIII so as to ensure predictability and  to avoid any adverse 
effects on other WTO  Members, including Ukraine,  arising from these countries' accession to the 
EAEC.  G/C/M/129  
 
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  2.6.  The delegate of Japan  thanked the Kyrgyz Republic for its update concerning the 
renegotiations and reiterated Japan's systemic interest in this issue. Japan looked forward to 
receiving an initial compensation offer from the Kyrgyz Republic so as to engage in negotiations 
and co nsultations with the Kyrgyz Republic and other interested Members, and in particular the 
members of  the EAEU.  
2.7.  The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
2.8.  The Council so agreed . 
3  ACCESSION OF THE REP UBLIC OF ARMENIA TO THE EURASIAN ECONOMI C UNION : 
PROCEDURES UNDE R ARTICLE  XXVIII:3 OF GATT  1994  – REQUEST FROM THE EUR OPEAN 
UNION  
3.1.  The Chairperson  informed the Council that , in a communication dated 19  June 2017, the 
delegation of the E uropean Union had requested the Secretariat to include this item on the 
agenda.  
3.2.  The delegate of the European Union  reiterated the points she had made under the previous 
agenda item concerning the accession of the Kyrgyz Republic to the EAEU. The EU again called 
upon Armenia and the Kyrgyz Republic not to delay the negotiations any longer and to submit a 
joint offer from Armenia, the Kyrgyz Republic, Kazakhstan, and the Russian Federation, in reply to 
the EU  request.  
3.3.  The delegate of Canada  encouraged Armenia to conclude its Article  XXVIII negotiations for 
compensatory adjustments by the extended deadline of January  2018. Canada looked forward to 
advancing discussions with Armenia regarding its claim of interest.  
3.4.  The delegate of Ukraine  reiterated the statement made under the same agenda item at the 
previous CTG  meeting.2 
3.5.  The delegate of Japan  reiterated Japan's systemic interest in this issue. Japan looked forward 
to engaging in negotiations and consultations with Armenia and other intereste d Members, in 
particular members of the EAEU, with a view to receiving appropriate c ompensation under 
GATT  Articles  XXIV and XXVIII.  
3.6.  The delegate of Chinese Taipei  again encouraged Armenia to engage in negotiations and 
consultations with his delegation and  other interested Members.  
3.7.  The delegate of Armenia  thanked delegations for their interest in Armenia's renegotiations 
under GATT  Articles  XXIV and XXVIII, following its accession to the EAEU. As a full member of the 
EAEU, Armenia had undertaken to coordina te its trade and economic policy with other 
EAEU  member countries. This implied a mutually agreed negotiation position. In this regard, 
Armenia had raised the issue of compensatory adjustment negotiations at the June  meeting of the 
EAEU  Council , where rele vant instructions had been adopted to facilitate the se ongoing 
negotiations. Intensive work was being undertaken by  EAEU  country members with a view to  
preparing a comprehensive reply to all WTO Member requests. Armenia stood ready to continue a 
pragmatic and constructive dialogue  with interested Members. His delegation would convey  
Members ' comments  to Capital . 
3.8.  With regard to Ukraine's statement, he reiterated Armenia's position on this issue , namely  
that, unfortunately, it could not formally accept the claim of interest and enter into 
GATT  Articles  XXIV and XXVIII procedures with Ukraine given that a free trade regime with 
Ukraine already existed . In light of that already fully operational free trade regim e, Armenia 
considered it redundant  to enter into tariff reduction or compensatory adjustment negotiations 
with a country with which Armenia had already been  trading at a zero tariff rate for more than 
two decades.  
                                                
2 See document  G/C/M/128, paragraph  6.6. G/C/M/129  
 
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  3.9.  Armenia would continue , on a regular basis , to inform the Council and all interested Members 
of ongoing compensatory adjustment negotiation s . 
3.10.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
3.11.   The Council so agreed . 
4  JORDAN – REQUEST FOR A WAIVER  RELATING TO THE TRAN SITIONAL PERIOD FOR 
THE ELIMINATION OF T HE EXPOR T SUBSIDY PROGRAMME FOR JORDAN (G/C/W/705; 
G/C/W/705/CORR.1; G/ C/W/705/REV.1; AND G /C/W/705/REV.2)  
4.1.  The Chairperson  drew Members' attention to document  G/C/W/705/Rev.2  containing a waiver 
request and a draft waiver decision submitted by Jordan in respect of the transitional period for 
the elimination of the export subsidy programme for Jordan. He recalled that , at the April  2017 
meeting of the Council , it had been agreed that the CTG would revert to this matter at its following 
meeting, at which  Jordan would update Members on any developments.  
4.2.  The delegate of Jordan , when updating Members on Jordan's  progress towards developing a 
WTO-consistent subsidie s programme to replace the existing programme , informed the Council 
that, having completed the data collection and a revision process, and having then finalized a 
report with the assistance of USAID  experts, the High Level Committee established by the 
government had met in April to decide on a new and WTO-consistent programme. The High Level 
Committee had recommended that, in compliance with the Agreement on Subsidies and 
Countervailing Measures (SCM), a certain percentage of the net income from industrial activities 
would be subject  only to income tax,  without any linkage to export activity. This recommendation 
had been sent to the Council of Ministers for its consideration and, if agreed by the Council of 
Ministers, the new programme would  then be submitte d to the legislative process. Consequently, 
once the new legislation had enter ed into force the current subsidy programme would be 
terminated.  
4.3.  He emphasized Jordan's commitment to the timetable contained in 
document  G/C/W/705/Rev.2  for the implementation o f a new subsidy programme. In the view of 
his delegation, the progress described above would  ensure that the WTO -compliant subsidy 
programme would enter into force as scheduled, and that the current export subsidy programme 
would automatically be terminate d by end -2018. He thanked Members for their cooperation and 
understanding of the critical circumstances currently challenging  the Jordanian economy and 
requested to include this agenda item in the agenda of the next CTG  meeting , in November  2017.  
4.4.  The delegate of the United States  thanked Jordan for its report on Jordan's efforts to make 
the necessary changes to the subsidy programme at issue, and noted that Jordan had requested 
that this item be included on the agenda for this meeting solely to pro vide Members with an 
update on Jordan's progress towards establishing a WTO -compliant replacement programme. The 
US had been actively involved in providing technical assistance to Jordan in the context of its 
reform efforts and acknowledged the concrete pr ogress that had already been  made  by Jordan . 
The US hoped that Jordan would continue to make progress so as to allow it to  implement the 
necessary programmatic changes as soon as possible.  
4.5.  The delegate of Australia  thanked Jordan for its update on the prog ress so far made to 
develop a replacement and WTO -compliant subsidy programme. He appreciated Jordan's 
transparency and open and constructive approach.  
4.6.  The delegate of New Zealand  also thanked Jordan for its efforts to bring its export subsidy 
programme in to WTO -conformity and its confirmation that, in any case, it would be terminated by 
end-2018. Her delegation remained ready to support Jordan in these efforts and looked forward to 
receiving further detail regarding Jordan's progress on this issue . 
4.7.  The del egate of Japan  welcomed Jordan's report and reiterated that Japan expected Jordan to 
eliminate the export subsidy program by end -2018 at the latest. Japan would continue to follow 
this issue  closely . G/C/M/129  
 
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  4.8.  The delegate of Chinese Taipei  appreciated Jordan's tran sparency and constructive approach 
to this issue, and welcomed Jordan's specific commitment to replace its current export subsidy 
programme with a new and WTO-consistent programme.  
4.9.  The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made and  that, as requested by Jordan, the Council agree to revert to 
this matter at its next meeting.  
4.10.   The Council so agreed . 
5  TRADE RESTRICTIVE ME ASURES BY CERTAIN MEMBERS – REQUEST FROM QATAR  
5.1.  The Chairperson  informed the Council that , in a communication dated 15  June 2017, the 
delegation of Qatar had requested the Secretariat to include this item on the agenda.  
5.2.  The delegate of Qatar  expressed deep concern regarding the measures adopted against Qatar 
in early June  2017 by the Kingdom of Saudi Arabia, the United Arab Emirates , and the Kingdom of 
Bahrain. These measures violated cornerstone WTO  obligations and commitments.  
5.3.  At the Servic es Council meeting on 16  June 2017, Qatar had highlighted a number of the 
measures imposed by the aforementioned Members that prejudiced Qatar's WTO  rights in relation 
to trade in services. Qatar wished also to highlight , at CTG  level, the impact of those measures on 
its rights with regard to trade in goods.  
5.4.  The sudden and unannounced embargo against Qatar violated fundamental provisions of the 
General Agreement on Tariffs and Trade  1994 (GATT  1994) and other WTO  agreements, including 
the new Trade Facilita tion Agreement (TFA). The measures in question uniquely targeted and 
discriminated against Qatar,  in violation of the Most Favoured Nation (MFN) principle , and included 
a complete prohibition on the importation from and exportation to Qatar of all goods. These 
measures had been applied in a variety of ways, ranging from closed land and maritime borders to 
absolute prohibition on the  discharge of goods from Qatar.  
5.5.  The measures not only denied Qatar's rights but also the rights of all WTO  Members with 
whom Qa tar traded by blocking freedom of transit of goods  through the territories of the 
aforementioned Members  that were either destined for or coming from Qatar . The Members 
concerned had recently reaffirmed their commitment to freedom of transit in the TFA; however, 
these measures violated key TFA requirements.  
5.6.  The measures affected a number of important sectors , ranging from trade in cable and 
satellite televis ion receivers, necessary for the supply of sports -related entertainment, to 
prohibition of the import and transit of aluminium originating in Qatar. Rather than pursuing their 
objectives in a WTO -consistent manner, the measures imposed against Qatar by the  
aforementioned Members constituted unilateral actions that were in gross disregard of Qatar i and 
other WTO  Member's rights.  
5.7.  The measures were especially pernicious given the customs union that existed between  
members of the Gulf Cooperation Council (GCC).  This customs union had facilitated regional 
economic integration and had thus established  an integrated single regional market in relation to 
which Qatari businesses were particularly sensitive, and especially with regard to any disruptions 
in that market . Qatar was disappointed that the measures at issue were being applied in a manner 
that favour ed commercial stakeholders from Saudi Arabia and the UAE but was to the detriment of 
the long-term interests of Qatar's commercial stakeholders. As in the Service s Council, in the 
Goods Council Qatar would like to ask the Members concerned to explain how their measures could 
be reconciled with the relevant WTO  rules, and also when those measures would be published , 
given that the instruments establishing the coerci ve economic measures at issue remained 
unpublished. Qatar looked forward to receiving prompt responses to these questions and reserved 
all of its rights under the WTO  Agreements.  
5.8.  The delegate of the Kingdom of Bahrain , on behalf of his delegation and of the delegations of 
the Kingdom of Saudi Arabia , the United Arab Emirates , and Egypt, argued that the measures 
were WTO -compliant and in accordance with GATT  Article  XXI, which provided  for emergency G/C/M/129  
 
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  cases in internation al relations with any other WTO  Member when measures  were necessary to 
limit actions that would affect a Member's national security interests.  
5.9.  The delegate of Egypt  reiterated that paragraphs  (b) and (c) of GATT  Article  XXI related to 
security exceptions , that the measures adopted fell under this exceptional circumstance, that the 
measures were rooted in WTO  law, and that they were consistent with the said  provision.  
5.10.   The delegate of Turkey  expressed the wish of his delegation that the issue , involving certain 
GCC countries and other states in the region , come to a prompt solution. The current situation was 
a cause of unease and undermined the good relations among the Gulf countries. Turkey believed 
that a longer -term resolution would only make the situation more complicated , especially in terms 
of the economic and trade relations in the wider region and beyond. Pressuring the people of Qatar 
economically and in terms of their commercial life and activity was a particular concern that might 
only calcify the si tuation and make it still more difficult to resolve . Turkey believed that the states 
concerned  shared hundreds of years of strong fraternal ties and could therefore overcome this 
current situation and impasse.  
5.11.   The delegate of the United Arab Emirates  regre tted that Qatar had raised the situation in 
the Gulf at the CTG. The United Arab Emirates and its coalition partners had been forced to take 
measures in direct response to Qatar's failure to put an end to its funding and support of terrorism 
and extremism.  Qatar had refused to refrain from funding terrorist groups and had thereby 
deliberately undermin ed the international community's efforts to impose sanctions on individual 
supporters of terrorism within the country. Dangerous groups, such as AQAP, Daesh, a nd the 
Taliban , continue d to use Qatar as a source of funds, and the funds originating in Qatar continued 
to flow to groups that much of the world designated as terrorist organizations, including Al  Nusra, 
Hamas, and the Muslim Brotherhood. Qatar's continu ed funding and support for terrorism and 
extremism constituted a direct threat to the United Arab Emirates' national security. The United 
Arab Emirates would not waver in its commitment to fight terrorism and extremism. The 
Government of the United Arab Em irates had a solem n duty to protect its citizens.  
5.12.   Moreover, the United Arab Emirates , like other WTO  Members, had undertaken international 
commitments to combat terrorism funding under the various UN  Security Council Resolutions and 
international treaties , including Resolutions  1373/2001, 1624/2005, 2252/2015 and , more 
recently , Resolution  2354/2017. Qatar was also a signatory to both  the UN  Convention Against 
International Organized Crime and the International Convention for the Suppression of the 
Financing of Terrorism. UN Resolution  2354/2017 and other international agreements were 
therefore binding upon  Qatar, even as Qatar  had chosen to ignore those obligat ions. 
5.13.   Despite its repeated failure to honour its international commitments, Qatar was now looking 
to the WTO in the hope that the WTO would  intervene on its behalf. The United Arab Emirates 
considered this to be a dangerous ploy that should be rejected. An y endorsement at the WTO of 
Qatar's claims would be applauded by terrorist groups who would then view the WTO as an 
instrument that could be used to limit Members' attempts to block their funding.  
5.14.   The situation in the Gulf was very serious. At the core of the issues under discussion was 
the question of national security. However, these issues did not fall within the competence of the 
CTG or the WTO. Indeed, GATT  Article  XXI clearly recognized that WTO  obligations did not prevent 
any Member from taking any a ction it considered necessary to protect its essential security 
interest or to pursue its obligations under the UN Charter for the maintenance of international 
peace and security . 
5.15.   The delegate of the United States  urged all parties to remain open to negoti ation as the best 
way to resolve this matter, and encouraged them to minimize rhetoric and rather to exercise 
restraint so as to allow for productive diplomatic discussions. The US was not going to get ahead of 
the current diplomatic discussions, particula rly not in a technical WTO  body; nevertheless, it would 
continue to stay in close contact with all the Members concerned and would continue to support 
the mediation efforts of the Emir of  the State of  Kuwait. The US believed that its allies and 
partners were stronger when they worked together towards stopping terrorism and countering 
extremism. Each country involved had something to contribute to that effort.  G/C/M/129  
 
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  5.16.   The delegate of Qatar  expressed deep concer n with regard to the various allegations that 
had been made by the United Arab Emirates and reiterated that the issues raised fell outside the 
purview of the WTO . He encouraged discussions that were relevant to the WTO  Agreement and the 
specific measures u ndertaken and would therefore refrain from responding to those specific 
allegations.  
5.17.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
5.18.   The Council so agreed . 
6  NIGERIA – IMPORT RESTRIC TING POLICIES AND ME ASURES – REQUEST FROM 
NORWAY AN D THE UNITED STATES OF AMERICA  
6.1.  The Chairperson  informed the Council that , in communications dated 14 and 16  June 2017, 
respectively, the delegations of Norway and the United States had requested the Secret ariat to 
include this item on  the agenda . 
6.2.  The delegate of Norway  appreciated the constructive meetings that had been held between 
Norway and the Nigerian authorities. The currency restrictions issue and the import restricting 
measures imposed by Nigeria ha d been raised by Norway and other Members at the WTO and in 
other fora. However, Norway required further clarification as to whether or not the restrictions in 
place were in line with Nigeria's WTO  obligations , as well as an update regarding possible 
developments on t he currency restrictions issue.  
6.3.  The issue of customs valuation had also been raised on several occasions  by Norway . Indeed, 
to calculate the customs value of fish imports to Nigeria, particularly st ockfish, the Nigerian 
customs administration had made a calculation on the basis of a value that  was higher than the 
agreed price indicated on the invoice , which resulted in  additional duty and value added payments 
on imports. During its recent TPR , Nigeri a had replied to Norway's questions on this topic although 
there appeared to be no intention on the part of Nigeria actually  to change its customs valuation 
method . He therefore called upon Nigeria to ensure that the customs valuation methods used were 
in all cases in accor dance with WTO  methodology.  
6.4.  Norway recognized the importance of transparency with regard to Members' applicable 
import regulations, both in terms of currency restrictions and fish importation policy in general. A 
transparent, predictable,  and rules-based trading system had to be the  proper  basis for trade. 
Norway would continue its bilateral conversation with Nigeria and looked forward to a continued 
dialogue  on this issue  in the CTG as well as  at other WTO  fora. 
6.5.  The delegate of the United  States  recalled that for nearly two  years his delegation, together 
with other delegations, had raised concerns with regard to Nigeria's import restricting measures in 
each of the meetings of this Council. In mid -June 2017 WTO  Members collectively had had an 
opportunity for an in-depth discussion of these matters during Nigeria's Fifth  TPR. The discussion 
on that occasion was a testament to the value of the TPR  mechanism , which allowed Members to 
acknowledge areas where Nigeria had made progress but also to flag issues of ongoing concern.  
6.6.  The Government of Nigeria  had approached the TPR  exercise positively, using the occasion to 
outline its plans for future reform s. It had also committed to review ing policies that other 
governments had identified as problematic or potentially WTO -inconsistent. Therefore, the 
US Government would for the time being suspend  raising these matters in the CTG but would 
continue to monitor developments in Nigeria  closely , in all areas, so as to ensure that the 
Government follow ed through on  its intended reform s so as to meet its WTO  obligations. As his 
delegation had indicated at the TPR, the key to Nigeria's competitiveness and economic 
diversification lied in decreasing production costs and increasing the ease of doing business, not in 
maintaining counterproductive import restricting measures.  
6.7.  The delegate of the European Union  said that the EU continued to be concerned about  the 
issues mentioned by Norway and alluded to by the US. Her delegation had expressed its view on 
these issues in detail during past CTG  meetings and also recently during Nigeria's TPR. The EU G/C/M/129  
 
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  looked forward to Nigeria's replies to the follow -up questions that it had pos ed as part of the 
TPR exercise.  
6.8.  The delegate of Chile echoed the concerns expressed by other Members with regard to the 
restrictive measures imposed by Nigeria and , in particular , the grounds given to justify such 
measures. He called upon Nigeria to bring its measures in to conformity with the relevant 
WTO Agreements.  
6.9.  The delegate of Japan  shared the concerns raised by other Members , both on systemic and 
commercial grounds . Japan considered the foreign exchange restriction on certain imported 
products to be a de facto  import restriction that had negatively impacted upon the businesses of 
WTO Members, including those of Japan. Japan believed the measure to be inconsistent with the 
WTO Agreements and urged Nigeria to provide updated information on its domestic review 
procedures regarding th e measures highlighted. Japan also urged Nigeria to revise those measures 
and to ensure that they would not adv ersely impact upon Members' exports.  
6.10.   The delegate of Uruguay  echoed the concerns raised by Norway with regard to imports of 
fish and fish product s and requested Members to refer to Uruguay's statements delivered at 
previous meetings of the Council.3 
6.11.   The delegate of Thailand  echoed the concerns raised  by others . Thailand considered the 
Nigerian measures to be inconsistent with its WTO  commitments an d called upon Nigeria to 
remove them immediately . 
6.12.   In the absence of a delegate from Nigeria, the Chairperson  thanked delegations for their 
interventions and proposed that the Council take note of the statements made.  
6.13.   The Council so agreed . 
7  BRAZIL – MEASURE S RESTRICTING SHRIMP  IMPORTS  – REQUEST FROM ECUADOR  
7.1.  The Chairperson  informed the Council that , in a communication dated 15  June 2017, the 
delegation of Ecuador had requested the Secretariat to include this item on the agenda.  
7.2.  The delegate of Ecuador  stated that the long -standing prohibition imposed by Brazil on 
imports of Ecuadorian shrimp had yet to be resolved despite the efforts of her Government to  
achieve a resolution . As explained at meetings of the SPS Committee in March  2013, March  2014, 
October 2016, and March and April of 2017, for almost two  decades Ecuador had been call ing on 
the Brazilian Government to again allow market  access to exports of Ecuadorian shrimp so as to 
re-establish a trading relationship that had operated smoothly until 19 99. In November  1999, the 
"Instructive Normative  39" had been issued by Brazil,  temporarily suspending import of shrimps 
into its territory, with an eventual  reopening conditioned by a risk analysis to be carried out  by the 
Department of Animal Defence.  
7.3.  For almost 20  years, Ecuador had been providing  all the evidence necessary to address the 
concerns of the Brazilian sanitary authorities , including  technical visits, submission of information, 
and presentation of proposals ; all had been unsuccessful. In 2007, Ecuador had implemented a 
monitoring plan for residues and contaminants across  the entire supply chain. On 23  August  2010, 
the Brazilian Ministry of Aquaculture and Fisheries had publ ished the "Instructive Normative  12" on 
General Procedures for Risk Analysis of Fisheries and Aquatic Animal Imports , and in  April 2011, 
Ecuador had subsequently submitted to Brazil a report on sanitary controls on Ecuadorian fisheries 
and aquatic export products. After a third meeting of a working group between Ecuador and Brazil,  
in November  2011, Brazil had assured Ecuador that Ecuador's request would be taken care of and 
that the conclusion of the first  phase would be communicated  shortly thereafter . When Ecuador 
had expressed its ongoing  concern at the SPS  Committee meeting of March  2013, Brazil had again 
indicated that the risk analysis report would be published imminently . On the 5 June 2014, Brazil 
produced a risk analysis on the import of shrimp. At around that time, a delegation of Brazilian 
inspectors had also travelled to Ecuador to conduct a verification of information  mission . During a 
meeting in June 2016 with officials from the Brazilian Ministry of Agriculture, Brazilian officers in 
                                                
3 See document  G/C/M/126, paragraph  8.15 G/C/M/129  
 
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  charge of the tec hnical report had admitted that there had been a delay beyond the normal risk 
assessment period. On 2 February  2017, th rough Memorandum N o. 6, the Department of Animal 
Health of the Ministry of Agriculture of Brazil had established the sanitary requirement s for imports 
of crustaceans. On 9 May 2017, through communication No. 9/26, the Brazilian Ministry of 
Agriculture had established  that the Ecuadorian inspection system for sea food exports was to be 
understood as equivalent for the purposes of Brazilian sanitary requirements, meaning that 
exports would then be authorized.  
7.4.  Ecuador hoped that the measure , which  had been in force for almost 20 years , and which had 
done such great harm to Ecuador,  would at last be repealed . However, on 24  May 2017, a public 
civil action had been lodged by Brazilian producers to suspend the authorization of import ed 
Ecuadorian shrimps , and a  federal judge had subsequently upheld the request to suspend imports 
of Ecuadorian shrimps, alleging that thousands of job s and the creation of new job opportunities 
were at risk . 
7.5.  Ecuador emphasized that the import prohibition imposed by Brazil on Ecuadorian shrimp was 
inconsistent with Articles  2.2, 5.1, 5.7, 2.3, 5.6, 5.5, 3.1 and the Annex  C.1(a) of the Agreement 
on the Ap plication of Sanitary and Phytosanitary Measures. The measure was also inconsistent 
with GATT  Article  XI, since it was a prohibition that was applied on ly to shrimp imports from 
Ecuador. The time that had elapsed without the issue being resolved indicated to Ecuador that 
Brazil's measure exceeded Brazil's  legitimate stated intention with regard to its introduction of 
SPS measures , namely that they were  to protect Brazil  from entry into its territory of pests or 
disease, and that Brazil was in reality imposi ng unjustified trade restrictions that were greatly 
harming Ecuador, which was a small developing country.  
7.6.  Ecuador expressed its systemic concern over Brazil's failure to resolve this issue and found it 
extraordinary that almost twenty  years could go by without one WTO Member completing a 
validation process of the SPS conditions of another WTO  Member, and especially bearing in mind 
that Ecuadorian shrimps were exported to a large number of markets where  SPS standards  were 
very high . Such practices hindere d small and vulnerable economies, such as Ecuador's , from 
benefit ting fully  from their trade and develop ment potential . 
7.7.  The delegate of Brazil  thanked the delegation of Ecuador for raising the issue and for 
informing the Council of certain new elements. He  believed that positive developments had been 
seen since the last CTG  meeting, including some already mentioned by the Ecuadorian delegation. 
His understanding was  that the Brazilian market had already been opened for shrimp imports from 
Ecuador and that this change  had been formally communicated to the Ecuadorian authorities in the 
letter mentioned by the delegation of Ecuador, Letter  No. 926 of 9 May 2017, from the Brazilian 
Ministry of Agriculture.  
7.8.  He noted that Ecuador's inspection system for fisheries now enjoyed equivalence status in 
Brazil, meaning that plants were automatically authorized to export with the only remaining 
requirement being product registration. The sanitary and public health requirements were 
contained in the international sanitary c ertificates (CSI) for the export of fisheries or fish products 
to Brazil, which were supplemented by the animal health requirements contained in Circular 
Memorandum No. 6 of 2017, also mentioned by Ecuador, and which had also been communicated 
to the relev ant Ecuadorian authorities. Exporting plants from Ecuador had also to formalize their 
requests for labelling approval to the appropriate Brazilian authorities, meaning the Department 
for Inspection of Animal Products. With regard to the ongoing judicial pr oceedings relative  to this 
matter, he stated that the federal government was taking appropriate measures to reverse or to 
try to reverse the preliminary measure that had been adopted by the judicial body in question.  
7.9.  The Chairperson  thanked delegations for  their interventions and proposed that the Council 
take note of the statements made.  
7.10.   The Council so agreed . G/C/M/129  
 
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  8  INDONESIA'S IMPORT A ND EXPORT RESTRICTING  POLICIES AND PRACTIC ES – 
REQUEST FROM THE EUR OPEAN UNION, JAPAN, AND THE UNITED STATES OF AME RICA  
8.1.  The Chairperson  informed the Council that, in communications dated 16 and 19  June 2017, 
the delegations of the European Union, Japan, and the United States, had requested that the 
Secretariat include this issue on the agenda.  
8.2.  The delegate of the European Union  noted that her delegation had been raising this issue for 
a very long time but unfortunately to no avail. Despite the reforms announced in Indonesia in 
2015 the high number of restrictive trade measures applied by Indonesia had not yet decreased. 
Rather, additional barriers had recently been issued or reinstated. The persistently high number of 
restrictive and protectionist trade and investment measures as well as the lack of predictability 
and transparency negatively affected the busine ss environment. For example:  
– Use of local content requirements persisted in various sectors , such as telecoms, 
retail, energy, construction, and public procurement;  
 
– high and discriminatory minimum capital requirements of USD800,000 to establish a 
new c ompany ; for freight forwarders, USD4  million versus only USD150,000 for local 
companies;  
 
– complex and time-consuming import requirements applied  in a wide range of sectors ; 
for instance, in the meat and dairy industry ; for fresh plants, horticulture, wood , and 
forestry products ; and for cosmetics. The measures were often amplified by the 
implementation of quantitative restrictions ; for example , on meat, alcohol products, 
and steel;  
 
– export restrictions continued to be applied to  certain raw materials . These measures 
disrupted international markets, increased input costs for producers, and led to  
uncertainty in terms of supply;  
 
– burdensome and discriminatory conformity assessment procedures as well as a 
growing proliferation of mandatory technical st andards, which were trade barriers that 
should not be maintained because o f their adverse impact on trade;  
 
– a very far -reaching halal law , which  affected food and beverages, pharmaceuticals, 
cosmetics, and leather goods exports. Its implementing measures, once finalized, 
could bring trade in these goods to a complete halt.  
 
8.3.  The EU expressed its concern over the new trade restrictions issued by Ind onesia. For 
example, a new regulation , Regulation  No. 77/2016, reintroduced limits on the importation of 
tyres. In addition, new draft rules in the dairy sector included a stipulation that "imports of milk 
would only be conducted if domestic production was  not able to fulfil national demand". Her 
delegation urged Indonesia to eliminate existing trade barriers and to refrain from issuing new 
ones in  line with its G20  commitments.  
8.4.  The delegate of Japan , as it and many other WTO  Members had done on many previo us 
occasions, at meetings of this Council and in other Committees, expressed its deep concern over  a 
protracted series of laws and regulations  introduced by Indonesia , namely, the Mining Law, the 
Law on Trade and Industry, restrictions in the retail sector , local content requirements on 
4G mobile phones, and local content requirements for investment in the telecommunications 
sector. Japan strongly urged Indonesia seriously to review those laws and regulations and to 
implement the measures at issue in a mann er consistent with the relevant WTO  Agreements. 
Japan also urged Indonesia to share with WTO  Members updated information about these 
measures, as requested at the CTG's previous meeting.  
8.5.  Japan had suffered adverse trade effects since January  2017 and the i ntroduction in 
Indonesia of local content requirement s for 4G  LTE Mobile devices . Some Japanese companies had 
been obliged to cease exporting their products to Indonesia as a result . Japan considered the 
Indonesian measures , and specifically the imposition of local content requirements , to be 
inconsistent with GATT  Article  III:4 and Article  2 of the TRIMS  Agreement, because the measures 
gave incentives to use domestic products and treated imported products less favourably than  G/C/M/129  
 
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  domestic products. Accordingly, Japan again requested Indonesia to remove these measures and 
local content requirement s. 
8.6.  On the issue of the Mining Law, the delegate of Japan noted that, in terms of low grade nickel 
ore, and based on the regulation issued  in January  2017, mining companies were allowed to 
export their ores for a period of five  years, although only if they did so in conformity with certain 
very strict conditions. Japan appreciated the reforms that had been made partially to lift the 
complete  prohibition of nickel ore exports , as well as the export licences issued by the Indonesian 
government . However, Japan considered the measures to prohibit or restrict exportation of 
mineral ores by imposing certain export conditions to be inconsistent with  GATT  Article  XI. Japan 
would continue to follow  closely  how Indonesia dealt with the revision of the measures at issue so 
as to bring them into conformity  with the relevant WTO  Agreements. He emphasized that Japanese 
industries had suffered economic injury as a result of the measures. Japan would also continue to 
monitor closely the situation surrounding the exportation of nickel and copper. Japan also urged 
Indonesia to share updated information on those measures  with WTO  Members , including 
information on  Indonesia's  local content requirement s and mining -related measures . He noted that 
the same request had already been made at previous meetings of the CTG and the 
TRIMs  Committee.  
8.7.  The delegate of the United States  noted that the Council was well aware of hi s delegation's 
breadth of concerns with regard to an ever growing number of trade and investment restrictions in 
Indonesia, which  affected a broad range of sectors, including information and communications 
technology, agriculture, consumer goods, and energ y. The measures that Indonesia had adopted 
included localization requirements, import licensing requirements, standards requirements, 
preshipment inspection requirements, and export restrictions, including taxes and prohibitions, 
among others. The United S tates had  on previous occasions  also expressed its concern about a 
general lack of transparency in Indonesia. In  addition, in  previous intervention s in this body, the 
United States had provided detailed information about specific policies as issues and con cerns had 
emerged , and for the US  those issues and concerns remained. He also noted that other Members 
had expressed concern about the policies at issue, at the CTG and other WTO  Committees.  
8.8.  Indonesian officials had acknowledged that the Government's polic ies were intended to 
promote domestic manufacturing and to move the Indonesian economy up the value chain to a 
higher level of development. He noted that , while his delegation understood those objectives, the 
implementation of the policies at issue were damaging to Indonesia's trading partners. US efforts 
to work with the Indonesian Government, bilaterally and at the WTO, to address US concerns had 
to date produced relatively disappointing results , with only limited exceptions. The United States 
had been very patient while working with Indonesia on these issues and his delegation hoped that 
efforts in this and other WTO  bodies, including bilateral work, would soon produce the results 
necessary to ensure free and fair trade.  
8.9.  The delegate of Australia  stated that his Government continued to share the concerns of 
other WTO  Members about Indonesia's import restricting policies in recent years, particularly as 
they affected agricultural trade. Australia noted that Indonesia frequently amended its regulation s 
on the importation of agricultural products, often without notification and, when notified, with only 
limited opportunity for consultation with trading partners. He stated that notification and 
consultation were critical to the continuing effectiveness o f the rules -based global trading system 
under the WTO. Consultation with trading partners also provided an opportunity for trade 
measures to be implemented in the most efficient way for all parties.  
8.10.   The delegate of Brazil  reiterated, as on previous occasio ns in the CTG, his delegation's 
support for the expression s of concern voiced by previous delegations regarding restrictive 
Indonesian trade policies, in particular , in the case of Brazil,  regarding poultry and beef. A number 
of the restrictive measures we re currently being examined in proceedings in the dispute settlement 
mechanism. Brazil urged Indonesia to bring its trade measures into full conformity with its 
WTO obligations, especially in light of developments under the dispute settlement mechanism 
involving Indonesia n measures . 
8.11.   The delegate of New Zealand  echoed the concerns raised by the European Union, Japan, the 
United States, and other Members. As her delegation had noted at previous meetings of the 
Council, New Zealand believed that Indonesia's restrictions on agricultural imports undermined 
core WTO  principles and were inconsistent with key obligations in the WTO  Agreements. New G/C/M/129  
 
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  Zealand continued to have significant concerns over a number of import restrictions in Indonesia's 
laws and regulation s that affected trade across a range of agricultural products, including 
horticultural and animal products. As her delegation had said before, Indonesia's restrictions did 
not hurt only exporters , but also Indonesian consumers, processors, and producers , all of whom 
had also been affected negatively by these measures;  Indonesia's measures had contributed to 
rising food prices in Indonesia, including for basic foodstuffs and on ingredients for the domestic 
manufacturing sector. New Zealand hoped that Indones ia would in future implement its reform 
plans using policies that were consistent with its WTO  obligations.  
8.12.   The delegate of the Republic of Korea  shared the concerns voiced by other Members but, 
given that this item had been on the agenda of the CTG for a number of years, he chose on this 
occasion to address just two  main issues of concern. First, his delegation had requested the 
Indonesian Government to reform the pre -paid corporate income tax on importers under Article  22 
of the Income Tax Law of Indonesi a in order to make it consistent with WTO  rules. The tax in 
question was an unfair and discriminatory measure against imported goods. Second, Korea 
continued to have concerns over the Industry Law and the Trade Law of Indonesia and strongly 
encouraged Indo nesia to formulate the ir implementation regulations in conformity with WTO  rules 
and to share any progress made in a fully transparent manner. His delegation would continue to 
monitor these issues closely and hoped for a positive response from Indonesia in  the near future.  
8.13.   The delegate of Norway  shared the concerns raised by other speakers. Norwegian exporters 
had reported experiencing difficulties with the Indonesian import regime, in particular with regard 
to import licensing and customs procedures. The measures were affecting a broad range of 
sectors, including the seafood industry. Norway looked forward to continue working together w ith 
Indonesia on the issues  in question . 
8.14.   The delegate of Switzerland  echoed the concerns raised by other Members regarding 
regulations relating to Indonesia's halal law and, despite constructive bilateral exchanges, 
Switzerland would still welcome further clarification of the  issue. He also indicated his delegation's 
interest in Indonesia's new draft regulation on supply and distribution of milk products. 
Switzerland would welcome from Indonesia any update on and/or clarification of this issue. 
8.15.   The delegate  of Chinese Taipei  stated that her delegation continued to be concerned about 
Indonesia's import and export restricting policies in recent years, and in particular the use of local 
content requirements for import licences for 4G -enabled devices. Chinese Ta ipei found that the 
requirements in question continued to be a significant and unnecessary obstacle to trade and again 
urged Indonesia to remove the trade restricting measures. Chinese Taipei had noted that, at the 
meeting of the Committee on Safeguard Mea sures of 23  June,  Indonesia had notified to Members 
its intention to extend safeguard measures on the importation of Flat -Rolled Product s of Iron or 
Non-Alloy Steel. At the same time, she noted that safeguard measures were among  the most trade 
restrictive instruments and should be adopted with caution and only to protect fair trade in very 
exceptional circumstance s, if absolutely necessary,  and as a last resort. Chinese Taipei urged 
Indonesia promptly to withdraw the measure s at issue . 
8.16.   The delegate of Canada  welcomed the recent progress made on improving Indonesia's 
business climate but considered that more still needed to be done. Canada continued to share the 
concerns of other Members regarding Indonesia's ongoing import restricting policies and pract ices. 
Canada was particularly concerned by restrictions in the mining and oil and gas sectors, increasing 
local content requirements across many sectors, including renewable energy, and uncertainties 
surrounding halal certification requirements. Canada als o remained concerned by import licensing 
requirements on horticultural products. Canada continued to encourage Indonesia to respect its 
WTO obligations.  
8.17.   The delegate of Indonesia  took note of the concerns raised, which would be forwarded to 
Capital for appropriate consideration and in order to discuss the measures in question or undertake 
any necessary changes. Prior to the meeting, her delegation had contacted her Capital but 
unfortunately had not yet received any updates on some of the questions or concer ns that 
Members had raised. She stated that Indonesia was willing to work with interested Members, in 
particular with those direct ly concerned or affected by certain aspects of Indonesia's  national 
legislation. Picking up on certain points raised at previo us CTG  meetings, Indonesia would like to 
assure Members that its policies were implemented on an equal basis for all Members, and 
including in relation to its own nationals. The current administration was taking bold steps to G/C/M/129  
 
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  ensure predictability and ease  of doing business in Indonesia while at the same time also ensuring 
that the social aspect of economic development would benefit Indonesia. Indonesia wanted to 
make sure that trade could be utilized as one avenue for growth and believed that it was the 
responsibility of each government to fulfil such an ideal while at the same time confirming a 
commitment to international rules. In that sense, certain policy spaces were necessary so as to 
address certain specific issues pertaining to the economy.  
8.18.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
8.19.   The Council so agreed . 
9  BRAZIL – MEASURES RESTRICTING  BANANA IMPORTS – REQUEST FROM ECUADOR  
9.1.  The Chairperson  informed the Council that , in a communication dated 15  June 2017, the 
delegation of Ecuador had requested the Secretariat to include this item in  the agenda.  
9.2.  The delegate of Ecuador  stated that , since 1997,  Brazil had suspended banana imports from 
Ecuador for SPS  reasons linked to the alleged presence of disease, specifically the Black Sigatoka 
fungus. In June  2002, Brazil had referred to "Standard  41", indicating that it would determine 
what was required to assess whether or not the fungus was present in Ecuadorian bananas ; Brazil 
would also inspect in particular bananas originating in areas infested with this plague . In 
July 2009, Brazil had issued Normative Instruction No.  29, establishing the criteria and procedures 
for fighting against this particular fungus so as again to allow  bananas to be exported to Brazil. 
Following these procedures, Ecuador had provided all the technical information necessary to meet 
the requirements and satisfy Brazil's concerns. In this vein , a Memorandum of 
Understanding  (MOU) was signed in which Brazil  committed itself to provide an official response to 
Ecuador. However, to date , Brazil had still not provided any official response. In January  2012, an 
Ecuadorian delegation visited Brazil with the intention of resolving the  issue and submitted a 
technical report according to which it was not possible to detect scientifically the plague in bananas 
originating in the Ecuadorian Amazonia. In turn , and in response to Ecuador's request, the 
Brazilian authorities issued a report q uestioning the health and SPS  quality of Ecuadorian bananas.  
9.3.  During a further visit of an Ecuadorian delegation to Brazil,  in November  2013, Brazil 
submitted a report concerning a particular virus that had been attacking bananas and announced 
that a techni cal visit to Ecuador's banana plantations would take place in order to inspect the 
Ecuadorian certification procedures and SPS  measures on bananas in place in  Ecuador. As a result 
of that visit, which took place in December  2013, a new agreement was signed  that laid out  a road 
map for identify ing the presence of potential plagues that could prevent Ecuadorian bananas  from 
enter ing the Brazilian market.  
9.4.  In October  2014, Ecuador had set out a work plan that was then submitted to the relevant 
Brazilian authori ties. In 2015 , the Brazilian authorities had requested further information , which 
Ecuador had provided in April  2016. Despite the above -mentioned exchange of information , and 
the actions taken by Ecuador in 2017 , Brazilian customs nevertheless refused a co ntainer of 
Ecuadorian bananas , arguing that the container did not have the necessary authorization to allow 
it to enter the Brazilian market.  
9.5.  Ecuador's economy was highly dependent up on exports and its main non -oil export products 
were shrimps and bananas,  two sectors that created  millions of jobs in Ecuador. Therefore, a ban 
on imports of Ecuadorian bananas not only had a severe impact on Ecuador's economy but also 
ran counter to WTO rules. Ecuador considered the Brazilian ban  of Ecuadorian bananas to be 
excessive , particularly as it had provided to the Brazilian authorities all the necessary guarantees 
and had also proven that its products were safe. Ecuador had met all the relevant 
SPS requirements although Brazil's measures had not followed the risk assessment and ran 
against Articles  5.1, 5.5, 2.2, 2.3 , and 6 of the SPS  Agreement , as they constituted an arbitrary 
and unjustified discrimination against a particular product and were not justified under Article  5.7 
either becau se the measures were  not provisional cautionary measure s. 
9.6.  Ecuador hoped that the Brazilian customs authorities had now received the instructions that 
had been published in Brazil in March  2014, and  which detailed  the SPS  standards that had been G/C/M/129  
 
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  implemented  by Ecuador and the agreement that had been established between Ecuador and the 
Brazilian authorities. Brazil should honour the commitme nts it had made to  Ecuador.  
9.7.  The delegate of Brazil  indicated that his delegation had very recently received some updates  
and inputs on this issue that it had not been able to convey bilaterally to Ecuador. He explained 
that the Department of Plant Health of the Secretariat of Agricultural Protection had set up a 
Working Group to finalize the risk analysis process regarding plagues that affect bananas 
originating from Ecuador, and particularly the Mycosphaerella fijiensis. On 16  June 2017, the 
Department of Plant Health had asked Ecuador to modify two  aspects of the Work Plan for plague 
risk mitigation that Ecuador had presen ted, and had also requested to receive a new version of the 
Plan containing those modifications. Furthermore, Brazil had given consideration to a comment 
submitted by Ecuador regarding Normative Instruction No.  3/2014 and was currently introducing 
certain adjustments to that regulation. Brazil hoped to  be able to  engage with Ecuador bilaterally 
on this issue and to provide copies of those communications , which had already been sent to 
Ecuador. He also requested Ecuador to provide its statement in written fo rm. 
9.8.  The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
9.9.  The Council so agreed . 
10  INDIA – IMPORT RESTRICTING M EASURES – REQUEST FROM CANADA,  THE 
EUROPEAN UNION, NORW AY, JAPAN, AND THE UNITED STATES OF AMERIC A 
10.1.   The Chairperson  informed the Council that , in communications dated 16 and 19  June 2017, 
respectively, the delegations of Canada, the European Union, Norway, Japan, and the United 
States requested the Secretariat to include this item o n the agenda.  
10.2.   The delegate of Canada  reiterated the concerns rais ed by her delegation in the 
WTO Committees on ITA and Market Access regarding India's Customs Notification No.  11/2014 , 
which referred to an increase in India's applied rates over the bound r ates for several IT  products. 
This was inconsistent with India's bound commitments and ran contrary to the objective of tariff 
liberalization.  
10.3.   Canada had a commercial interest in exporting some of the goods whose applied rates had 
been increased and was co ncerned that the tariffs in question might have an adverse impact upon 
Canada's exports of such goods to India. This was particular ly the  case for tariff line  8517.62.90, 
bound by India at a rate of 0% while the rate actually applied was 10%. In 2016, Canada had 
exported US$24 million to India on this tariff line alone. Wit h regard to India's responses to the 
questions from certain Members about Customs Notification No.  11/2014, Canada asked India to 
confirm the tariff classification o f the goods mentioned therein. Canada did not accept India's 
justification for applying tariffs above the rates set in India's bound commitments and sought 
clarification regarding recent reports that India was planning to raise its applied rates above its 
bound commitments also on additional products. Canada likewise urged India to consider the 
domestic impact of imposing tariffs on IT  products, which had become an integral part of a 
growing and innovative economy. Canada believed that providing industry wi th access to 
competitively priced inputs was key to their success, whether finished goods were consumed 
domestically or exported for consumption abroad. She invited India to respe ct its Schedule of 
Concessions.  
10.4.   The delegate of Japan  echoed Canada's concern s about India's applied customs duties on 
ICT products, an issue that had long been discussed in the ITA and Market Access Committees, 
and in the CTG. Despite the repeated calls that had been made to India these concerns remained 
unaddressed and India cont inued to apply duties of 10% on four ICT products that were higher 
than the bound duties of 0% for the same products. This was inconsistent with India's binding 
commitment. Japan called upon India to clarify in which HS  code it classified the four  ICT products 
in question,  and looked forward to receiving India's prompt response. As stated at prev ious CTG, 
Market Access , and ITA  Committee meetings, Japan continued to be particularly interested in 
digital cameras (HS  8525.8020) and pr inted circuit assemblies (HS 8538.9000) , as well as in the 
imposition of customs duties on imported mobile phones. He called upon India promptly to clarify 
these issues.  G/C/M/129  
 
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  10.5.   The delegate of the European Union  recalled that her delegation had raised this issue on 
several occasions in this Council, in the ITA  Committee , and in the Market Access Committee. The 
EU shared the concerns about the 10% import duty applied by India on ICT  products under 
HS code 8517, wh ich were already covered by the ITA and therefore bound at 0% in India's tariff 
Schedule. In its replies to the EU 's questions, India had confirmed that this was not an issue of 
classification, that the 10% duty was applied to a number of ICT  products, and  that India did not 
consider itself to be bound by its ITA  commitments in this case, given that the products in question 
did not exist at the time that those commitments had been under taken. However, the EU remained 
unconvinced by these arguments. India co nsidered that these products were "new" products and 
therefore not covered by the ITA. The EU was of the view that this argument did not hold, 
particularly in light of past WTO  case law on IT products in the European Communities, and in light 
of the fact t hat the ITA covered all products that had been classified in the WTO  Model List of 
Items contai ned in JOB (07)/96. These products were identified through their harmonized system 
classification, which was regularly updated to take into account different HS  revisions. Therefore, 
all of them fell within the scope of the ITA Agreement, regardless of their description , and enjoyed 
a 0% duty rate as bound in India's Schedule of Concessions. She called upon India to share its 
point of view on these aspects  of the i ssue, as highlighted by the EU . 
10.6.   On previous occasions , the EU had also mentioned the cases of digital video cameras and 
so-called "other electronic integrated circuits (EICs)", classified under HS  codes  8525.80 .20 and 
8542.39 .00, respectively, which were two ICT  products for which the applied tariff was neither in 
conformity with India's bound  Schedule of Concessions , nor the ITA. The EU had also been 
informed recently that India intended to reintroduce customs duties on mobile phones, which also 
fell within the scope of the ITA, and which were also bound at 0% in India's Schedule of 
concessions. With these measures, India was continuing to ignore the EU 's requests , and 
continu ing to be in breach of its WTO  commitments. India  should also clarify this new is sue. 
10.7.   The EU regretted to be compelled to raise these issues again , but after several attempts to 
solve them in different committees , as well as bilaterally , India had still not addressed them. Given 
the importance of these products in international trade, the EU again called upon India promptly to 
eliminate these tariffs, which violated its WTO  commitments and created barrier s to trade that 
were in opposition to the G20's call to roll back protectionism. The EU would continue carefully to 
monitor India's co mpliance with its WTO commitments.  
10.8.   The delegate of Norway  echoed the concerns raised by previous speakers; there was indeed 
a discrepancy between India's applied rates and its bound commitments on certain products. 
Furthermore, reports in the Indian press had referred to discussions about or plans to increas e 
customs duties on other IT  products. In Norway's view, a Member's applied tariffs might not 
exceed those listed in their schedules and technological advancement within the product segment 
did not in an y way alter that simple fact. If this were not the case, a very large number of 
Member's commitments  would then be put into question . Given the economic and systemic 
implications of this issue, Norway looked forward to receiving additional clarification fr om India on 
this issue.  
10.9.   The delegate of the United States  reiterated the concerns already raised by the US on 
multiple occasions , in Geneva, Washington , and Delhi , regarding the 10% applied tariffs imposed 
by India on four categories of telecommunications equipment, pursuant  to Indian Customs 
Notification  11/2014. Despite the various calls made to India to clarify the tariff classification for 
the product categories  identified in its Notification  11/20 14, India had repeatedly failed to provide 
any information, arguing that "the main issue here is not the classification but the tariff binding 
commitments". The US agreed with India that the issue was fundamentally a qu estion of India's 
binding tariff commitments – namely, the potential discrepancies between India's WTO bound 
commitments to provide duty-free access to certain products, and the non-zero import duties that 
were actually being applied at the border. If the telecommunications products identified in India's 
Notification  11/2014 had indeed been classified in a tariff subheading for which India's 
WTO schedule reflected a zero duty rate, then a decision by India to impose any tariff rate other 
than zero would be inconsistent with India's WTO binding commitment.  
10.10.   Indeed, India's WTO  bound schedule for HS  subheading  8517.62 was 0% but India's 
published and applied MFN  schedule indicated a 10% duty for products classified within this 
subheading. This was certainly an issue of tariff binding commitments , as indicated by India; 
therefore, India must abide by its WTO  commitments and revoke Customs Notification  11/2014.  G/C/M/129  
 
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  10.11.   Moreover, as indicated by his delegation at the meeting of the Committee on Market 
Access , in May  2017, concerns also existed over India's intention to increase import duties on 
mobile phones, and other technology products , in support of its "Make in India" campaign. He 
therefore drew Members' attention to India's Schedule of Concessions, specifically tariff  
line 8517.12.00 , which covered "telephones for cellular networks and for other wireless networks", 
and for which India's binding tariff commitment was zero. The US called upon the Indian 
government to abide by its WTO  commitments when considering whether or not to raise customs 
duties on imported mobile phones o r any other technology product.  
10.12.   The delegate of Chinese Taipei  echoed the concerns raised by previous speakers and 
recalled that these concerns had been repeatedly raised in the ITA and Market Acces s Committees, 
and at previous CTG  meetings. Chinese Taipei also considered that an applied rate that stood 
above the bound rate of 0% for items under HS  code 8517 was inconsistent with India's bound 
commitments. She urged India to honour its WTO  commitments.  
10.13.   The delegate of Australia  shared the concerns r aised by previous speakers.  
10.14.   The delegate of Singapore  expressed Singapore's concern with regard to this issu e, which 
had already appeared on the agendas of this Council, and the Market Access and  ITA Committees.  
10.15.   The delegate of Thailand  shared the same concerns on this issue  that other delegations 
had already expressed . Thailand held a commercial interest in the products in question and wou ld 
closely follow up on this issue.  
10.16.   The delegate of Switze rland also shared the concerns already expressed by other Members 
regarding India's imposition of import duties on information technology products that were above 
the rates bound by India in its Schedule of Concessions, namely a bound rate of 0%. This 
represented a breach of India's WTO  commitments  and deserved clarification. Switzerland also 
urged the Indian Government to reconsider its intention to impose import duties on additional 
IT products, such as mobile phones, for which India's bound rate  was also  at 0%, as reflected in 
India's HS2007 certified Schedule for its tariff line  8517.12.00. Any decision to impose an import 
duty on these goods would be fully inconsistent with that commitment.  
10.17.   The delegate of  the Republic of Korea  said that, as an IT-exporting country, Korea had 
significant systemic concerns about this issue. India's tariff policy was not WTO-compliant and the 
arguments that it had raised at the last CTG  meeting were not convincing. Concerns also existed 
with regard to India's  intentio n to expand import duties to other ITA  products , such as mobile 
phones. India should provide further clarification and just ification of its tariff policy.  
10.18.   The delegate of India thanked Members for their continued interest in India's customs duty 
regime on certain electronics, IT, and telecom (ICT)  products. The concerns raised by Member s 
referred to three issues: (i)  the imposition of customs duties on certain ICT  items indicated in 
Customs Notification  11/2014; (ii)  the apparent disparity in applied duties  on certain tariff lines – 
such as 8525 .80.20 and 8542 .39.00, that covered digital still video cameras and EICs, with India's 
zero binding commitment under the ITA and WTO  Schedule of concessions; and (iii)  the likely 
imposition of customs duties on certai n other goods , such as mobile phones.  
10.19.   In respect of the first concern, he referred to document  G/IT/W/42 , containing India's 
written responses to the questions posed by certain Members in document  G/IT/W/45 , as well as 
to the replies that had been provided  by India at the meeting of the Committee on Market Access , 
on 2 May 2017, and at the CTG  meetings of 17 November  2016 and 6  April 2017. Since there had 
been no change in India's position, interested Members might refer to India's written replies as 
well as to its oral statements made at the aforesaid meetings.  
10.20.   With regard to the second issue, he informed the Council that no duty had been applied on 
ITA items falling under tariff lines  8525.80.20 and 8542 .39.00. India had exempted those items 
from customs duty through specific customs notifications.  
10.21.   On the issue of mobile phones, he indicated that the concerns raised by Members at this 
and previous meetings of the CTG and the Committees on Market Access and ITA had been and G/C/M/129  
 
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  would be forwarded to his  authorities for consideration, and that, in addition, there was no 
customs duty on mobile phones to date.  
10.22.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
10.23.   The Council so agreed . 
11  EGYPT – MANUFACTURER REGISTR ATION SYSTEM – REQUEST FROM THE EUR OPEAN 
UNION AND THE UNITED STATES OF AME RICA  
11.1.   The Chairperson  informed the Council that , in communications dated 16 and 19  June 2017, 
respectively, the delegations of the European Union and the Un ited States had requested the 
Secretariat to include this item on  the agenda.  
11.2.   The delegate of the European Union  recalled the calls her delegation had made to Egypt in 
the TBT  Committee inviting Egypt to suspend its measures that formed the basis of the 
manufacturers' registration system so as to fully abide by WTO  rules. These measures overlapped 
with existing requirements in a number of sectors and lacked transparency. Like many other 
Members, the EU was concerned about the disproportionate obstacles to trade that these 
measures created , and  which, in addition, were detrimental to Egypt's economy , and which had 
hampered EU  exporters from reach ing Egyptian markets for more than a year.  
11.3.   The EU acknowledged that the measures had been adopted in a context  of serious foreign 
currency shortages but , following the recent implementation of an economic reform programme, 
including flo atation of the Egyptian currency, foreign reserves were now almost at pre -2011 levels ; 
there was thus no further need to maintain rest rictive measures aimed at reducing imports. 
Therefore , once the files submitted by the companies concerned had been accepted and 
processed, the EU would appreciate the prompt granting of authorizations by the Ministry of 
Foreign Affairs for mandatory regis tration of foreign companies wishing to export to Egypt under 
Decree  43/2016 . 
11.4.   She again called upon Egypt not only to suspend the measures without further delay , and 
actively to reconsider and revise them in consultation with stakeholders, but also to noti fy them to 
the TBT  Comm ittee before their enforcement.  
11.5.   The delegate of the United States  said that , after many discussions of this issue in the 
TBT Committee, including at the most recent meeting , in mid -June 2017, the US was raising its 
concerns to the CT G in the hope that Egypt would now address them. Egypt's Ministerial Decree 
No. 43/2016 required that imports of products listed in HS  Chapter  25, including apparel, toys, 
chocolate, cosmetics, milk and dairy products, motorcycles, and washing machines, wo uld only be 
allowed into Egypt if produced by manufacturing facilities, or imported from companies owning 
trademarks, that were registered with the Ministry of Trade's General Organization for Export and 
Import Control, or GOEIC. However, it was unclear wh ether Egyptian manufacturing plants and 
companies were also subject to similar registration, surveillance , and inspection requirements , or 
whether some companies or countries were receiving exemptions from the Decree's requirements.  
11.6.   Additionally, Decree  No. 991/2015 required pre -shipment inspection of 23  products listed 
therein. These largely overlapped with products listed in Decree  No. 43/2016 to ensure their 
conformity with relevant Egyptian quality standards and regulations that were also managed und er 
the GOEIC.  
11.7.   As previously noted in the TBT  Committee, the decrees in question raised concerns about 
National Treatment and the fulfilment of Egypt's obligations under the WTO  Technical Barriers to 
Trade (TBT) Agreement, which required there to be non -discrimination in the application of 
technical regulations, and that technical regulations should be no more trade restrictive than 
necessary in order to achie ve their legitimate objectives.  
11.8.   Egypt's backlog in processing applications had a negative impact upon the trade in goods. 
Given the failure of US efforts to address these issues  bilaterally and during the TBT  Committee 
meetings, the US rest ated its priorities as follows:  G/C/M/129  
 
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  (i) Egypt should suspend the application of the measure and allow further time for 
submission and consideration of comments by interested parties. As part of this 
consideration, Egypt should consider three TBT  requirements:  
 
– take the opportunity to consider whether its requirements needed to be altered 
to take into account the nature of  particular goods and industries  so as to avoid  
unnecessary obstacles to trade;  
 
– consider if a use of international standards could ap propriately meet Egypt's 
objectives;  and 
 
– consider the need to avoid unnecessarily duplicative requirements ; 
 
(ii) in order to provide greater confidence with regard to the processing of the applications 
in an efficient manner, Egypt should provide an update on: (a)  the number of 
applications ; (b) how many had been approved ; (c) how many had been rejected ; 
(d) how many  were under consideration and when di d Egypt expect to complete 
them;  
 
(iii) Egypt should continue its engagement with the US and interested parties by 
continuing to provide updates on the development, adoption, and enforcement of this 
measure.  
 
11.9.   The delegate of Thailand  echoed previous speakers and registered Thailand's interest in this 
issue.  
11.10.   The delegate of Switzerland  referred to the concerns on this issue expressed by his 
delegation at previous CTG and TBT  Committee meetings. He thanked Egypt for having provided 
some responses to the questions that Switzerland posed to it in the TBT  Committee and in written 
communications. Switzerland encouraged Egypt to consider a less trade restrictive approach and 
to bring its legislation and implementation into compliance with WTO  principles and rules, including 
the TBT  Agreement. Switzerland remained concerned about the systems' lack of transparency as 
well as the lack of clarity in the registration process.  
11.11.   The delegate of Chile thanked the EU and the US f or their statements , which also reflected 
Chile's concern over Egypt's registration system. Chile also wished for further clarity on the system 
and called upon Egypt to bring it s measures  into conformity with the WTO  Agreements, particularly 
the TBT  Agreem ent which required that any TBT  measure not be more trade  restrictive than 
necessary. He called upon Egypt to bring these measures in to conformity with WTO  rules so as to 
improve the predictability of trade between the ir two countries.  
11.12.   The delegate of Turkey thanked the EU and the US for having placed this issue on the 
Council's agenda. Turkey had been closely following and was concerned about Egypt's 
manufacturer registration system. Despite their previous attempts  to do so , at bilateral and 
multilateral l evels, Turkey had still not seen any improvement in the situation and many Turkish 
companies were still awaiting registration by the so-called GEOIC, even when the required 
formalities had all been completed. Others were yet to be informed about the relevant registration 
process. The Egyptian Registration System procedures were lengthy, costly, and complicated. 
Turkey considered that both the pre -application and the implementation of the registration system 
were burdensome, non -transparent , and create d unnecessary obstacles to trade. Turkey therefore 
called upon Egypt to consider removing its manufacturer registration system.  
11.13.   The delegate of Egypt  thanked the speakers for their statements and explained that there 
were two  different decrees, Decree No.  43/2016, which required the registration of manufacturing 
plants and trademarks eligible to export their products to Egypt, and Decree No. 991/2015, 
regarding pre -shipment inspection to ensure conformity of the imported products with the relevant 
Egyptian standards. Both decrees had been notified to the TBT  Committee where they had already 
been examined by Members.  
11.14.   Since its notification of Decree  No. 43/2016, Egypt had held a number of constructive 
consultations with its trading partners and had also provi ded written responses to comments 
received through its TBT  enquiry point. Egypt believed that any discussion relating to the G/C/M/129  
 
- 20 - 
 
  implementation of these decrees should occur under  the TBT  Committee. However, Egypt 
considered it appropriate to underline several  points, mainly regarding Decree  No. 43/2016. This 
Decree did not deal with or require broader compliance with new or current specific technical 
regulations as its nature was merely administrative and it therefore did not impose further burdens 
on producer s or companies so as to comply with specific technical regulations.  
11.15.   Although Egyptian importers of products listed in the Decree represented only a fraction of 
total Egyptian imports, the Egyptian market had witnessed in the last years a sharp increase in the 
volume of such products; this was the consequence of illegal and counterfeited manufacturing 
which had a negative impact upon consumers' health and safety. Egypt also believed that this 
Decree represented an opportunity, rather than an obstacle, as it provided credible producers with 
a better competitive environment as it allowed for great control of counterfeited products imported 
into Egypt.  
11.16.   With regard to the registration backlog, he confirmed that the registration process largely 
depended on compani es submitting a complete file, including all requested data and certificates. 
However, it was to be noted that, since the full implementation of the Decree, hundreds of 
producers and manufacturers had in fact been registered  successfully . 
11.17.   He also confirmed that Egyptian manufacturing plants and companies were also subject to 
registration surveillances and to inspection requirements by numerous Egyptian regulatory 
authorities so as to ensure their compliance with relevant regulations. Egypt was fully committed 
to the WTO and believed that the registration requirement under Decree  No. 43 was not more 
trade  restrictive than necessary , and that it complied with WTO  rules, and with the TBT  Agreement  
in particular . He encouraged interested delegat ions to approach Egypt bilaterally or in the context 
of the TBT  Committee.  
11.18.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
11.19.   The Council so agreed . 
12  IMPORT LEVY BY WTO M EMBERS OF THE AFRICAN UNION – REQUEST FROM JAPAN 
AND THE UNITED STATES OF AME RICA  
12.1.   The Chairperson  informed the Council that , in communications dated 16 and 19  June 2017, 
respectively, the delegations of Japan and the United States had requested the Secretariat to 
includ e this item on  the agenda.  
12.2.   The delegate of Japan  first welcomed the contributions made by the African Union  (AU) to 
peacekeeping activities and then reminded delegations that , at the last CTG  meeting, the 
AU Group Coordinator had indicated that Members' co ncerns on AU import levies would be 
conveyed to his Group for discussion at its next coordination meeting. Japan asked whether or not 
this issue had been discussed among WTO  Members of the AU and , if so, how they intended to 
implement the AU  Assembly Decision on import levies. Japan had heard that a few AU Members  
intended to impose , in addition to customs duties,  a 0.2%  duty on imported products from other 
Members , but without imposing the same duties on African Members. If this were  the case  it would 
be inconsistent with the WTO's MFN principle. Japan sought from all AU  members that were also 
WTO Members further information as to how they intended to collect  the required payments of 
0.2%  of total import duties. Japan emphasized that any decisions on this matter should be 
implemented in a  consistent manner with the WTO  obligations of AU  members that were also 
WTO Members, including the MFN  principle and a Member's binding commitments.  
12.3.   The delegate of  the United States  appreciated having this opportunity to discuss the 
trade -related aspects of the African Union's Decision for AU  members to finance 100% of the 
AU's operational budget, 75% of its program me budget, and 25% of the AU  Peace Fund by 2020, 
which had been unanimously adopted by AU member  states in Kigali in July  2016. 
12.4.   The US had a number of updates to report since the April  CTG meeting , as follows : (i) on 
15 June, the US had reported to the UN  Security Council that it continued to support the 
AU's efforts to increase financial self -reliance and advance plans to reinvigorate and endow the G/C/M/129  
 
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  AU Peace Fund. At that meeting, the US had emphasized its interest in working with African 
countries to identify non -trade mechanisms through which to raise funds for AU  financing – rather 
than on th e basis of trade mechanisms, which the US could not support ; (ii) the US had 
understood that at least two  AU members had indicated their intention to impose a new import 
levy as a revenue source for contributions to the AU  and, at least in one  case, that i t was 
reportedly intended to apply the levy only to non -AU members, in contravention of the 
MFN principle. At least a few AU  member governments had informed the US that they intended to 
use non -trade mechanisms to meet their AU  commitments, and many Africa n countries were still 
discussing in their Capitals how they intended to finance their contributions to the AU.  
12.5.   The US clarified that it was not in a position to support any WTO  waiver that would 
authorize the use of trade measures to finance AU  activities . The US looked forward to discussions 
outside the WTO on options for non -trade mechanisms that would support the AU's  efforts to 
self-finance.  
12.6.   The delegate of the European Union  reiterated the EU's support for the purpose and cause 
of the measure, which aimed at enabling the AU to finance its own activities and , in doing so,  to 
support African countries. However , it wished to  receive more information about the levy from 
AU members that were also WTO  Members , and specifically to receive information with regard to 
their intentions and any measures that had already been adopted. The EU attached utmost 
importance to transparency and encouraged African WTO  Members to notify the measures in 
question. The EU called upon African Members to adopt only WTO-compatible and co mpliant 
measures on this issue.  
12.7.   The delegate of Canada  reiterated Canada's support for the AU 's efforts to increase African 
resource mobilization to fund the operations and programmes of the African Union  Commission. 
And, like African states themselves, Canada would like to see sustained, predictable, and flexible 
funding mechanisms identified by means of which to support the AU's peacekeeping operations. 
His delegation was encouraged by Africa's efforts t o provide more sustainable funding, including 
for African Union -led peacekeeping operations, the AU  Peace Fund. While Canada was pleased to 
support Africa's regional integration and free trade efforts, it was also keen to continue to develop 
its own trade with Africa, and so encouraged AU  members that were also WTO  Members to begin 
discussions with other WTO  Members to ensure that any proposed import levy would be 
WTO-consistent in its implementation. Canada looked forward to receiving an update from the 
AU WTO Members on how they planned to approach this issue.  
12.8.   The delegate of Rwanda , speaking on behalf of the African Group , took note of the 
statements that had been made and would convey these to the relevant authorities.  
12.9.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
12.10.   The Council so agreed . 
13  CHINA – TRADE DISTORTING MEA SURES – REQUEST FROM  THE UNITED STATES OF 
AMERICA  
13.1.   The Chairperson  informed the Council that , in a communication dated 16  June 2017, the 
delegation of the United States had requested the Secretariat to include this item on the agenda of 
today's meeting.  
13.2.   The delegate of the United States  said that his delegation had two  specific concerns with 
regar d to China's trade practices , and specifically with regard to the timeliness and completeness 
of China's subsidies notifications; at the same time, he noted  that these same concerns had 
already been expressed by  several Members in various CTG  subsidiary co mmittees . 
13.3.   In 2016, China had reported on its subsidies at the sub -central level  for the first  time. 
However, China had not covered all of its provinces in its reporting, and had also omitted several 
important sectors, such as steel, aluminium, and fisheries. This was significant given the important 
role sub -central governments had played in keeping failing firms afloat, especially in sectors 
experiencing overcapacity. The US urged China to address this problem promptly given that G/C/M/129  
 
- 22 - 
 
  China's practice to  date had prevented Members from accessing crucial information about these 
programmes so as to better understand their operation and trade effects, and to engage with 
China on reform.  
13.4.   WTO Members had repeatedly expressed concern over China's government int ervention and 
support in several key industrial sectors, such as steel and aluminium. China's practices had led to 
severe overcapacity, with much of the surplus Chinese product s being dumped around the world. 
Members had repeatedly urged China to take conc rete steps to stop its harmful government 
intervention and support and to rein in its excess capacity and excess production in these key 
sectors. Instead, China's efforts to address excess capacity had not resulted in meaningful 
reductions in total capacit y and production had continued to increase even in the face of 
decreasing demand.  
13.5.   China also appeared set on increasing its intervention and support in other ways, as 
evidenced by a significant infusion of money into semiconductors and the "Made in China  2025" 
industrial plan, which targeted 10  manufacturing industries for technology acquisition, market 
share dominance in China, and significantly increased global market share by 2025. In other 
words, much more excess capacity and excess production was on it s way.  
13.6.   In response to China's unwillingness to resolve these issues on its own, Members had had 
no choice but increasingly to adopt anti -dumping measures to address the resulting injury to their 
own industries. For example, of the 22  Members that had repor ted anti -dump ing activity in the last 
six months, 18  Members (or 82% of the total) had done so vis -à-vis China. Of those 18  Members, 
16 (or 89%) had involved steel or aluminium exports from China.  
13.7.   The US urged China to change its course and truly to commit  to the market -based reforms 
it had promised to undertake when it joined the WTO. Until this occurred, industries injured by 
dumped imports would continue to seek relief, and their governments to provide it , to an extent  
commensurate with China's governmen t intervention. The US looked forward to  address ing this 
issue with China.  
13.8.   The delegate of the European Union  recalled that , in April  2017, the EU had highlighted its 
concern about the existence and rapid growth of overcapacity in multiple sectors, both traditional 
and advance d, high-tech fuelled  sectors ; about the internal policies of certain Members, notably 
China ; and about a recourse to non-market -oriented decisions that had led directly to 
overcapacity. Examples  of such policies could be found in an extensive myriad of support 
measures that had led to a backlash against free trade. The EU thus called upon China to tackle 
the distortions that threatened the very foundations of the free trade system , a free trade system 
from which China had clearly benefitted since its accession to the WTO. However, China had not 
yet taken positive action on any of these issues. The intertwined web of subsid ies granted to 
pre-defined strategic and pillar sectors had also been further amplified by a lack of notification 
under Article  25 of the SCM  Agreement, which required Members to notify subsidies and whose 
objective was to ensure transparency so as to allo w Members to review each other's actions in the 
area of subsidies . 
13.9.   Unfortunately, Members' level of compliance with this requirement had deteriorated 
significantly since 1995 , as the share of Members that had notified their subsidies had decreased 
from 50%  to 38%. Despite Members' obligation to notify their subsidies, out of 162  Members only 
62 had notified their use of subsidies by 30  June 2015 during that year's cycle. Equally worrying 
was the fact that, while notifications were required for subsidies programmes implemented at both 
the central and sub -central levels of government, some Members, including China, did not notify 
sub-central subsidy programmes at all, or else did so in notifications that were inadequate. 
Indeed, the quality of actual notifi cations  was often doubtful , including attempts by some 
Members , like China, to notify subsidy programmes that clearly fell outside the scope of the 
SCM Agreement  so as to create an appearance of transparency without subjecting actual industrial 
subsidies t o global scrutiny ; this practice  also deserved attention. The EU urged other Members, 
notably China, to start complying fully with their subsidy notification obligations under WTO  rules 
and called upon China to avoid any trade spillovers as a consequence of overcapacity, particularly 
as these posed a systemic risk to global trade relations.  G/C/M/129  
 
- 23 - 
 
  13.10.   The delegate of Japan  echoed previous speakers and stated that , as had been recognized 
at the G20 and G7  meetings, measures such as the granting of subsidies based on 
non-market -oriented policies distorted the market and were one  cause of the global overcapacity 
problem. The need to strengthen the market function in response to those issues had also been 
recognized at the G20 and G7  meetings.  
13.11.   Japan had made a joint propos al at previous SCM  Committee meetings highlighting the 
need to tackle subsidies that contributed to overcapacity in certain industries, including the steel 
and aluminium industries. Japan believed that it would be beneficial to deepen the discussion 
among WTO Members as to how best to respond to this issue. As also indicated at the last 
SCM Committee meeting, Japan considered that China's subsidy notifications were unsatisfactory, 
particularly regarding subsidies given at sub -national level. Therefore, Japan once again called 
upon China to submit the relevant notifications.  
13.12.   The delegate of Canada  recalled Canada's call s at previous CTG  meetings to take urgent 
action to address the problem of global excess manufacturing capacity . In Canada's view, such 
actions should be aimed at addressing the underlying causes of excess capacity, including 
government intervention in key sectors such as steel and aluminium. The persistence of 
government intervention and over -capacity in these sec tors had led to an increase in the use of 
anti-dumping measures to address the dumping of goods onto the global market. Trade remedies 
were legitimate and necessary tools to remedy injurious dumping and would continue to be used if 
dumping  persisted in int ernational markets. Canada reaffirmed again the importance of the 
WTO framework for rules-based trade in responding to these issues.  
13.13.   The delegate of China  took note of the previous statements and indicated that it was the 
second  time that this issue had be en raised at the CTG , where China had already provided its 
responses. Further,  the issue of overcapacity did not form part of the CTG's nor of the 
WTO's terms of reference, thus the CTG was not the appropr iate forum for this discussion.  
13.14.   China said that , in spite of the fact that certain Members' trade policy stances were under 
pressure to take an inward turn, as certain Members were swayed by an undercurrent of 
de-globalization and confronted with rising protectionism, China remained committed to its policy 
of further opening up and deepening reform. Indeed, in January  2017, President  Xi Jinpin, in his 
visit to the World Economic Forum in Davos, and the UN  headquarters in Geneva, had made clear 
China's policy of advocating economic globalization, s afeguarding free trade, and upholding 
multilateralism. China would continue to promote trade and investment liberalization and 
facilitation, continue to commit unequivocally to anti -protectionism, and continue to proceed  with 
its consistent and strong supp ort for an open, transparent, inclusive , and non -discriminatory 
multilateral trading system.  
13.15.   Moreover, since the 3rd Plenary Session of the 18th CPC Central Committee, China had 
taken measures to comprehensively push its reforms to greater depth and active ly and 
increasingly  to open up to the world. The following three  examples illustrated China's position in 
this regard:  
(i) The supply -side structural reform: Reforms had been conducted in major areas, 
market access had been broadened, and the transaction c osts of enterprises had been 
cut as a result of reduced taxes and fees. New industries, and new business formats 
and models , had been developing rapidly , and in a sound manner, thereby 
contributing to the transformation and upgrading  of the Chinese economy ; 
 
(ii) Opening up further to foreign investment: In January  2017, the State Council issued a 
Circular on "Several Measures for Expanding, Opening Up and Actively Utilizing 
Foreign Capital", relating to measures to further boost foreign investment in secto rs 
such as services, manufacturing, and mining. China would  continue to implement 
facilitation measures and treat domestically funded and foreign invested enterprises 
on an equal footing;  
 
(iii) Further improvement to the rules based and business enabling environment. In 
September  2016, the National People's Congress of China revised four  laws regulating 
inbound investment, which provided for a negative list regime for the establishment of 
foreign invested enterprises. The types of investment that were outs ide the negative G/C/M/129  
 
- 24 - 
 
  list were not subject to pre -establishment examination or approval and only required 
filing for record. This approach would be further advanced and perfected.  
 
13.16.   As to the concerns raised at this meeting, China had already provided explanati ons and 
clarifications on a number of occasions a nd in various fora of the WTO. Overcapacity was a global 
issue that could not be overemphasized and that required collective international effort to be 
solved. Following the G20  call in 2016, a "Global Forum  on Stee l Excess Capacity"  (GFSEC) had 
been established to deal with this problem through regular sessions. Therefore, China did not see 
any justification in introducing this issue into the WTO, and believed there was no causal link 
between steel overcapac ity and any so -called "interventions" or "policy support" involving the steel 
sector. Relevant policies in China were generally aimed at encouraging environmental protection 
and energy conservation, supporting technological research, development , and innov ation, as well 
as facilitating industrial structural adjustment. These policies were not specifically provided to the 
steel industry or  to any steel companies, and nor were they contingent at all upon export 
performance, or intended for import substitution . China believed that similar policies were also 
applied in other countries and regions. Moreover, China had taken the initiative to directly address 
this global problem by pressing ahead with the supply -side structural reform and by phasing out 
excess steel capacity. In 2016 alone , over 65  million  tons of steel capacity and 290  million tons of 
coal capacity had been eliminated. These were tangible efforts undertaken by China as a part of its 
contribution to the international community. Indeed, the steel an d iron products produced by 
China were mainly targeted for its internal demand, and figures from 2016 show that steel and 
iron products exported from China only made up about 14% of China's total output in the country, 
which was far below the 40% equivalen t in Japan.  
13.17.   China, as a responsible WTO  Member, attached great and serious importance to its 
transparency obligations and notifications under the WTO. With regard to the concerns about 
transparency raised by previous speakers, she indicated that China had provided detailed 
explanation s and clarification s during each and every session of the SCM  Committee meetings in 
2015-2017, and that in recent years China had also made continuous efforts to further enhance 
transparency with regard to its subsidy policies,  and in particular at the sub -central government 
level. China acknowledged that a few years ago it had had some gaps with regard to its 
submission of  notifications  of this type . However, back in October  2015, it had submitted details of 
its central government level support of subsidy programmes, and immediately before China's 
Sixth TPR, in mid -2016, it had submitted the first  sub-central government level subsidy notification 
to the SCM  Committee . Members were asked also to recall that China was a vas t country with an 
uneven level of development among its regions; therefore, the collection and compilation of all the 
different kinds of information needed for these highly technical notifications required a very high 
knowledge capacity from local officers . Nevertheless , China had successfully notified these 
subsidies  and was currently at the same rate and level of notifications as the Members represented 
by the previous speakers, with the except ion of  Japan,  which had recently submitted its 2017  cycle 
of subsidy notification s, while China and the aforementioned Members were still in the process of 
preparing their notifications  for the current cycle . This positive track record had been recognized 
and recorded  in SCM  Committee meetings.  
13.18.   With regard to the com pleteness and timeliness of notifications, she reiterated China's 
position , expressed at the most recent SCM Committee meeting , that Members were required to 
consider two  points when addressing this matter. First , that the so -called "specificity" issue might 
be different for each and every Member; the SCM  Agreement thus authorized a Member to submit 
its notifications based on its own understanding of the subsidy definitions, as provided by Article  1, 
and on its own understanding of the specificity as pro vided for in Article  2 of the Agreement. 
Second, Members' understanding of the definition of subsidies at different levels might also be 
different. For China, for example, sub-central level subsidies in the absence of a clear definition in 
the SCM  Agreemen t referred to programmes funded by local government alone , or jointly funded 
by central and local government, whereas the programmes solely funded by central government 
were central level subsidies. As it had done in the past, China would continue to respo nd to the 
questions raised by the US and other Members based on the rules and disciplines in the 
SCM Agreement. However, China  contested the US's invariable and groundless complaints as to 
China's alleged un willingness to fulfil its obligations, which ign ored the tremendous progress that 
China had already made  in this direction . China could not accept  such a constant ly negative tone 
with regard to its record on subsidy notifications.  G/C/M/129  
 
- 25 - 
 
  13.19.   Nor could China see any logical link between the so -called "incompleteness" of a 
notification with an abusive use of anti -dumping or countervailing measures; this was not a 
forceful argument or reasoning in defence of an abusive use of trade defence tools.  
13.20.   With regard to the "Made in China Programme  2025", she indicated that this programme 
had been formulated according to China's current level of industrialization and that it was 
consistent with the WTO  core objective of improving the quality of Chinese products and 
equipment. The implementation of this prog ramme would bring about huge market opportunities 
for both domestic and foreign companies alike, and more overseas equipment and manufacturing 
products and technology were expected to flow into the Chinese market. More sino-foreign 
cooperation in the area of equipment and technology would also be witnessed. With regard to the 
green development aspect of the programme, the same policy support would be provided to both 
domestic and foreign companies registered in China.  
13.21.   In conclusion , she invited interested M embers to study China's statements and responses 
already provided in the CTG's subsidiary bodies, like the SCM  Committee, very carefully; in doing 
so, they would enjoy a clearer understanding of what China was achieving with regard t o its 
transparency obligations.  
13.22.   The delegate of the United States  thanked China for its responses to the concerns raised 
but indicated that , whatever reductions or eliminations of capacity had been undertaken by China, 
there had been no decrease in overall capacity , but rather the opposite. Further, with regard to the 
completeness of notifications , he noted that China would have Members believe that they did not 
have a single subsidy programme to support their steel and aluminium industries.  
13.23.   The delegate of China  said that sh e did not know the source of the statistics mentioned by 
the US  delegate regarding the absence of reduction in overcapacity and repeated that in China's 
view the appropriate place to deal with this issue was the Global Platform. She also indicated that , 
at the spring meeting of the SCM  Committee, China had submitted an Article  XXV:8 reque st for 
information regarding US  support measures in the steel sector; two of those measures wer e at 
federal level and four  at state and local levels. However, none of the support measures in question 
had been notified. She repeated that overcapacity was a global issue that involved  many factors 
and players . Therefore, rather than incriminating others , it would be more appropriate to join 
efforts, to exchange information at the appropriate forum, and to search a solution and agree an 
outcome. Indeed, China had displayed a leading role  in this regard,  as China had taken its own 
initiative s to eliminate  so-called excess capacity. However, China would like to know what others 
had done or to what degree they had conducted similar internal efforts  to this end . In addition , 
China did not find it proper to exercise protectionism in the name of overcapacity, and Members 
should be against an abusive use of protectionist measures ; this was particularly the case in the 
current climate, where protectionism was gaining ground.  
13.24.   The delegate of the United States  welcomed China's expression of interest in working 
directly with the US on some of these issues, particularly regarding the s ubsidy notifications issue, 
and looked forward to meet ing bilaterally with China after all these years to discuss these issues in 
advance of future subsidy committee meetings.  
13.25.   The Chairperson  thanked delegations for their interventions and proposed that th e Council 
take note of the statements made.  
13.26.   The Council so agreed . 
14  THE RUSSIAN FEDERATI ON – TRADE RESTRICTING PR ACTICES : EXPORT BANS, 
CEMENT STANDARDS , GMP CERTIFICATES – REQUEST FROM THE EUR OPEAN UNION  
14.1.   The Chairperson  informed the Council that, in a comm unication dated 19  June 2017, the 
delegation of the European Union had requested the Secretariat to include this issue on the 
agenda.  
14.2.   The delegate of the European Union  regretted to refer again to the same four  issues that 
had already been raised at the la st CTG  meeting but no progress had been made  since then. The 
four issues in question were as follows : (i) the GOST  cement standard, which was a concern raised G/C/M/129  
 
- 26 - 
 
  not only in this Counci l but one that had also been discussed at the TBT  Committee; (ii)   good 
manufacturing practices for pharmaceuticals; (iii)  the ban on exports of skins and hides; and 
(iv) the list of goods subject to export bans.  
14.3.   With regard to the GOST  standards, the EU deplored the fact that the Russian Federation 
had resorted to certificat ion requirements and enforced them without prior consultation or even 
notification (for example, the 2017  amendments to the GOST  standard on cement certification, the 
standard GOST  R 56836  2016 had not been notified). She requested Russia immediately to ma ke 
public the content of the legislation. Russia had not consulted pri or to the adoption of the 
first GOST  Standard in 2016 and had notified it only after its enforcement. The current system was 
such that all imports had become  impossible except for a few white cement shipments , for which it 
seemed that Russia was not self -sufficient ; this could possibly have explained why the 
authorization was made on a piecemeal basis for EU  exports. There was no rationale for such 
disproportionate certification requireme nts and controls, which included , among others,  strength 
tests to be carried out exclusively at the border, and quality controls to be issued by bodies that 
were not nominated . These technical questions had also been raised by the EU in the 
TBT Committee.  
14.4.   With regard to the "good manufacturing practice" certificates for pharmaceuticals, this was 
a requirement that had not yet been notified to the WTO, although it had been adopted , in 
December  2015, and had entered into force on 1  January  2016 for new produc ts, requiring them 
to have marketing authorization. It entered into force on 1  January  2017 for renewal s of marketing 
authorization. In addition, her delegation had indicated at the last TBT  Committee meeting that 
the requirement in question implied a high  number of controls abroad, which was hardly 
compatible with the existing Russian resources in terms of trained and available inspectors. For 
that reason, the EU  had called for several measures  to be taken by the Russian Federation , 
including an appropriat e transition time,. Finally, they had also requested that the specific issue of 
veterinary products of double inspection of sites manufacturing "Active Pharmaceutical 
Ingredients" and final products be reconsidered by the Russian Federation.  
14.5.   On the issue of the ban on exports of skins and hides introduced by Government Decree 
No. 826 of 19  August  2014, she recalled that it had been established initially for a period of 
six months but had been several times extended  subsequently . As a result, the export ban would 
be in place for approximately three  years if one considered that it had been introduced in 
August  2014 and had been recently renewed up to 18  August  2017. Therefore, the EU no longer 
considered it to be a temporary ban but rather a ban that had been in place for three  years. Her 
delegation had raised the issue several times in the Market Access Committee but the replies from 
Russia had not been convincing, especially since the latest renewal of the ban, already in place, 
would invalidate GATT  Article  XI(2)(a). Her delegation would appreciate further details and 
explanations regarding the latest renewal of the ban.  
14.6.   On the updated list of goods that could be subject to export ban she indicated again that 
Government Decree No.  19 of 18  January  2017 introd uced amendments to the list of goods that 
were essential to the internal market of the Russian Federation and in respect of which temporary 
restrictions or export bans could be imposed in exceptional cases. Her delegation would appreciate 
knowing what Russ ia's intentions were in that regard and if Russia planned to adopt export 
restrictions/bans on that basis for birch logs HS  code 4403 95 0001, for example.  
14.7.   The delegate of Ukraine  shared the concerns raised by the EU and urged the Russian 
Federation fully to comply with its WTO  notification commitments in order to ensure predictability 
and transparent conditions for trade, and to remove unjustifiable bans and discriminatory barriers 
to trade.  
14.8.   The delegate of the United States  echoed the concerns raised by t he EU with regard to 
various measures and practices adopted by the government of Russia that were having an adverse 
impact on US  exports. The US had noted Russia's failure to notify TBT  measures, and the resulting 
lack of transparency. It was a fundamental principle of the WTO that measures should be notified 
prior to their adoption in order to allow interested Members sufficient time to provide comments, 
and for those comments to be take n into account. Like the EU, the US had raised concerns about 
the "good manufacturing practice (GMP)" certificates for pharmaceuticals, most recently in the 
March  meeting of the TBT  Committee  and in the April  meeting of the CTG , but the situation since 
then had not changed.  G/C/M/129  
 
- 27 - 
 
  14.9.   The US had also raised a number of questions in the TBT  Committee about Russia's good 
manufacturing practices measure and looked forward to receiving timely and fulsome responses 
from Russia. The US also looked forward to the imminent re moval of Russia' s continued 
"temporary ban " on exports of skins and hides that continued to be in place , which in fact 
suggested that it was not temporary at all. As also noted at the April  meeting , the US was troubled 
by Russia's expansion of the list of products that could be subject to export restrictions , contained 
in Government Decree No. 19 of 18 January  2017, and looked forward to receiving an explanation 
from Russia about its intentions regarding the possibility to export any of the products on the list, 
as well as confirmation of the consistency of these measures with Russia's WTO obligations.  
14.10.   The delegate of the Russian Federation  thanked the delegations of the EU, Ukraine, and 
the US , for their interventions. With regard to the export ban on leath er semi -products, she 
indicated that the measure had been reintroduced several times following certain intervals of time  
during which export s of skins and hides had been possible. The measure was first reintroduced 
from 1  February to 1  August  2017 by Government Resolution No.  20 of 18  January  2017. The 
Russian Federation had carefully considered the EU 's question on this matter and was still 
preparing the appropriate answers.  
14.11.   With regard to the list of goods mentioned by the EU and the US , she indicate d that this 
related to the Federal Law "On the Fundamentals of State Regulation of Foreign Trade Activity" 
No. 164-FZ of 8  December  2003, and clarified that the goods that had been qualified as 
significantly important were not necessarily intended to be su bject to any export limitations. She 
also indicated that the quantitative restrictions, currently in force, had been notified by Russia in a 
timely manner in the document  G/MA/QR/N/RUS/3. Regarding the GMP and cement certifications , 
she recalled that the i ssue had already been raised at the last TBT  Committee, where the Russian 
Federation had provided explanations and comments on the measures at issue. Russia had 
discussed the matter with interested delegations and was ready to continue working with them.  
14.12.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
14.13.   The Council so agreed . 
15  UKRAINE – ANTI -DUMPING MEASURES ON IMPORTS OF CERTAIN NITROGEN  
FERTILIZERS ORIGINAT ING IN THE RUSSIAN F EDERATI ON – REQUEST FROM THE 
RUSSIAN FEDERATION  
15.1.   The Chairperson  informed the Council that, in a communication dated 19  June 2017, the 
delegation of the Russian Federation had requested the Secretariat to include this issue on the 
agenda.  
15.2.   The delegate of the Russi an Federation  said that , despite the calls made to Ukraine by his 
delegation at the last meeting of the Anti-Dumping  Committee regarding Ukraine's anti -dumping 
investigation on imports of nitrogen fertilizers, in May  2017 Ukraine had imposed definitive 
anti-dumping measure s on imports of these products.  
15.3.   Indeed, when the main facts of the investigations had been disclosed, these had shown 
that, after having established a range of dumping margins for different Russian exporters 
(between 19 and 31.84%), Ukr aine had decided to apply a flat measure on the basis of  the highest 
duty rate to all Russian exporters and thus completely disregarded the individual results of the 
investigation.  The GATT  and Anti -Dumping Agreements explicitly stated that the duty rate h ad to 
be "not greater in amount" and "shall not exceed" the margin of dumping. Additionally, the 
Appellate Body (AB) in US – Zeroing  had confirmed that "the margin of dumping established for an 
exporter or foreign producer operates as a ceiling for the tot al amount of anti -dumping duties". By 
imposing on all Russian exporters the same duty, equal to the highest dumping margin calculated 
within the investigation, Ukraine had violated its WTO  obligations.  
15.4.   Russia also believed that Ukraine was in violation of Article  2.2 and Article  2.2.1.1  of the 
Ant-dumping Agreement ( ADA) in its construction of the normal value by rejecting natural gas 
costs actually incurred by Russian exporters and replacing them with the price of gas exported 
from Russia to Ukraine. This also contradicted recent Appellate Body findings in , for example,  the G/C/M/129  
 
- 28 - 
 
  case of EU – Biodiesel , where it had established that the exporter's costs could not be evaluated 
"pursuant to a benchmark unrelated to the cost of production in the country of origin".  
15.5.   There were many other flaws in the investigation at issue, but Russia 's intention was to 
highlight Ukraine's practices in the area of determining normal values and appropriate levels of 
final anti -dumping duties. Overall, in violation of its WTO  obligation s, Ukraine was now applying 
artificially inflated duties on all Russian fertilizers without considering the results of the 
investigation and actual exporters' price policies. Consequently, Russia believed that Ukraine' s sole 
intention was to squeeze Russia n products out of the Ukrainian market. He urged Ukraine to bring 
this measure in to conformity with WTO  rules by immediate ly terminating its application.  
15.6.   The delegate of Ukraine  informed delegations that the decision on the application of 
definitive anti -dumping measures on imports to Ukraine of certain nitrogen fertilizers originating in 
the Russian Federation had been adopted in December  2016 based on the findings of the 
Anti-Dumping Investigation ( ADI). This investigation had been conducted in accordanc e with the 
requirements of the ADA taking into account current Ukrainian legislation. Moreover, during the 
anti-dumping investigation all interested parties, and Russian producers and exporters in 
particular, were given the opportunity to provide written e vidence and other information in defence 
of their interests. The decision to apply definitive anti -dumping measures had been taken in 
accordance with the positive conclusions reached with regard to the existence of dumping of 
certain nitrogen fertilizers o riginating in the Russian Federation, the injury to national producers , 
and a causal link between the dumped imports and a material injury. As indicated by Russia, 
anti-dumping measures on imports of certain nitrogen fertilizers originating in Russia came into 
operation in Ukraine on 22 May 2017.  
15.7.   Ukraine believed that WTO  rules allowed Members to use trade defence instruments, 
practices, and requirements within the WTO  framework, while responding attentively to the 
legitimate concerns of any WTO Member. Ukraine abided by these rules and remained ready to 
cooperate and clarify its obligations under the WTO  Agreements  if requested to do so . 
15.8.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the sta tements made.  
15.9.   The Council so agreed . 
16  UNITED STATES OF AMERIC A – SECTION  232 INVESTIGATIONS O N THE EFFECT OF 
IMPORTS OF STEEL AND  ALUMINIUM PRODUCTS O N US  NATIONAL SECURITY – REQUEST 
FROM THE RUSSIAN FEDERATION  
16.1.   The Chairperson  informed the Council that , in a communication dated 19  June 2017, the 
delegation of the Russian Federation had requested the Secretariat to include this issue on  the 
agenda.  
16.2.   The delegate of the Russian Federation  indicated that, in April  2017, the United States had 
initiated two  invest igations on the effect of imports of steel a nd aluminium products on US  national 
security. Both procedures had been authorized by Section  232 of the Trade Expansion Act of 1962. 
Currently, the US  Department of Commerce (US  DOC) was considering whether steel and 
aluminium were being imported into the United States in such quantities and under such 
circumstances as to threaten to impair national security. In the case of an affirmative finding, the 
US DOC would recommend remedy  measures to adjust imports of those products.  
16.3.   To illustrate Russia' s substantial interest in both cases she indicated that , in 2016, Russian 
exports of iron and steel products into the US  accounted for US$1 .36 billion, which represented 
6% of total US  imports under HS  group  72. Russia had become the fifth  largest supplier in the 
US market of such goods , and in certain segments was the  leading  supplier . For example, 58% of 
US imports of pig iron originated in the Russian Federation, and Russia was a lso the second  largest 
supplier of semi -finished products , accounting for 31% of US  imports.  
16.4.   As for aluminium, in 2016, the R ussian Federation was the third  largest US  trading partner , 
guaranteeing 7% of total US  foreign supplies under HS  group  76. In absolute fig ures, this G/C/M/129  
 
- 29 - 
 
  constituted US$1 .37 billion. Russia' s major export item was unwrought aluminium , since 16% of 
US imports came from  Russian companies.  
16.5.   In Russia's  view, both of the current procedures lacked transparency and predictability since 
the key parameters of the investigations remained obscure. She asked for clarification from the US 
of the following issues: (i)  the intended dates of the reports ' publication and the introduction of the 
measures , because the US  DOC would have 270 days to carry out its investigation but US  officials 
had indicated that they expected both the outcome and the report to be published imminently ; 
(ii) the product scope which  had not been defined  in either instance; t he official publications 
merely referred to "steel" and "al uminium" imports in a broad sense; (iii)  the geographical scope , 
as apparently the measures had been designed with differential restrictions according to a 
product's source , that is, special treatment may be granted to countries with which the US had a 
free trade agreement or so -called "allied relationship" ; (iv) the right of defence , because the 
interested parties had been given an opportunity to provide written commen ts, but some 
exporters, including Russian exporters , had not been granted a comparable opportunity to present 
their cases in oral hearings. Thus, it was not clear on the basis of what ground s and rationale the 
Russian exporters were being  treated different ly; (v) the commercial aims , because the opinion of 
US officials published so far had suggested that the investigations were intended to help to 
overcome the effects of dumping, subsidies, and overcapacity. This created doubts as to the need 
on the part of the US to impose additional trade limitations on top of the 154  anti-dumping 
measures and countervailing orders currently applicable to steel and aluminium imports. The US 
should clarify its justification for imposing  more limitations ; (vi) the form of the measures , as there 
was still no official indication as to their configuration, except for a limited indication from 
US officials that the measures may take the form of tariffs or quotas. The US  should clarify the 
form or forms the measures would take  and reassure Members that any planned measures  would 
fall within US  bound levels and not constitute quanti tative import restrictions.  Additionally , the US 
should confirm that such measures were consistent with its obligations under GATT  Articles  I, II, 
VI, X, XI, XVI , and XIX, under the ADA, under the SCM  Agreement , and under the Safeguards 
Agreement.  
16.6.   Overall, the Russian Federation believed that , to stabilize world markets of steel and 
aluminium it would be better if the US refrained from introducing any tr ade restrictive measures 
following the investigations at issue, given that such restrictions would not eliminate the root 
causes of the market imbalances and would not therefore provide any lasting solutions. What was 
needed was a more energetic and concer ted international action from the G20 in the context of 
best efforts made at the Global Forum on Steel Excess Capacity. The Russian Federation looked 
forward to receiving the replies and confirmatio ns from the US concerning these issues.  
16.7.   The delegate of the European Union  recalled that no GATT  exception justified an import 
restriction taken outside of the framework of trade remedies for the purpose s of protecting a 
domestic industry against foreign competition. While GATT provided for secu rity exemptions, the 
scope of such exemptions was circumscribed by specific situation s and conditions that appeared to 
be absent in the cases at issue.  
16.8.   The EU believed that a proliferation of Section  232 actions would create an unacceptable 
systemic risk a nd that the issue related to overcapacity, which was an issue addressed earlier by 
the EU under agend a item  13, in support of the US.  
16.9.   The EU had been informed about the acceleration of the Section  232 investigation of the 
US DOC into the national security aspects of US  imports of steel. Apparently, the report was 
imminent and might recommend restriction s on imports from third  countries, including the EU. The 
EU regretted that normal procedure and due process had not been followed in this investigation. 
There had been no in -depth study of the sector by the International Trade Commission, no 
questionnaire had been sent to producers on downstream users of steel, the public hearing had 
been hasty and had allowed for only a limited number of stakeholders to make  their views known. 
The investigation was not petitioned by industry but self -initiated by the administration. US  steel 
production, if one examined price, stock market valuation of relevant companies, and production 
volumes, was in fact picking up , and was much healthier than it had been a few years ago.  
16.10.   All indications suggested that the EU would be the US  trading partner most affected by 
these possible measures. If Canada and Mexico were excluded from the measures, and considering 
that Chinese exports were  for the most part already subject to trade defence measures, the G/C/M/129  
 
- 30 - 
 
  EU could be the  WTO Member  most affected by the import restricting action under consideration . 
The EU  would be firm in taking all necessary actions if import restrictions were applied to its  
exports.  
16.11.   The delegate of China  echoed the points made by the Russian Federation as China was 
also concerned about the US  investigations under Section  232 initiated in April  2017 on the import 
of steel and aluminium products , which intended  to assess the i mpact of imported products on 
national security grounds. National security was a wide concept and lacked a clear definition.  
16.12.   China believed that imports of steel and aluminium  products had not threatened 
US national security and that the current Section  232 investigations were inconsistent with 
Article  XXI of GATT  1994. Only two  months after launching the investigation did the US  DOC 
indicate its decision to publish in the near future the result s of this investigation . A number of 
WTO Members, including China, were highly concerned with the due process unfairness of 
US investigation proceedings. Accuracy, adequacy, and completeness of investigation evidence for 
such complex investigations had been conducted in a rush and within a very limited period of ti me. 
China urged the US to take a prudent and restrained attitude regarding the use of these trade 
policy tools . 
16.13.   In conclusion, China argued that the impact of Section  232 investigations needed to be 
assessed carefully and fairly so as to avoid creating tra de barriers in the name of national security, 
which would definitely affect the normal flow of international trade, and the flow in trade of steel 
and aluminium products  in particular . 
16.14.   The delegate of Brazil  echoed the views expressed by previous speakers,  namely the EU, 
and China , and noted that Brazil had already transmitted its specific comments to the 
US authorities with regard to the ongoing Section  232 investigation.  
16.15.   WTO Members were familiar with the provisions and very strict boundaries of 
GATT  Article XXI. Brazil did not exclude the possibility that, within those boundaries , 
circumstances may arise where essential security interests were at stake. However, Brazil was 
concerned by the systemic implications for trade if Members did not continue to fol low the 
time-tested approach of not resorting to trade restrictive measures based on security concerns 
unless those concerns fell clearly within the bounds of Article  XXI. On the contrary, an elastic 
interpretation of what constituted security interests fo r purposes of international trade could le ad 
to results that would not be in the interests of any Member.  
16.16.   The delegate of Japan  expressed interest in this issue and would closely follow US  actions 
to address it.  
16.17.   The delegate of Australia  stated that Australia's steel and aluminium industries had also 
been affected by global excess and a range of government interventions in the sectors at issue. 
Australia had imposed trade remedy measures to address injurious dumping and subsidization of 
imports in Australia's market. Undoubtedly, this was a global challenge and Australia shared the 
concerns of others that , in addressing this global challenge, international trade rules should 
nevertheless still be upheld.  
16.18.   Australia acknowledged that US  Section 232 investigations to determine the extent to 
which steel and aluminium imports impaired US  national security interests were still under  way, 
and believed that any recommendations and subsequent actions resulting from these 
investigations might still r emain consistent with international trade rules and be objectively 
justifiable. Any unjustifiable measures could further exacerbate global market distortions and 
result in retaliation and tit -for-tat measures, which would then harm Members ' economies.  
16.19.   The delegate of Chinese Taipei  indicated that her delegation also had a systematic concern 
with regard to this issue and would be closel y monitoring the investigation  as it proceeded . 
16.20.   The delegate of the United States  thanked the Russian Federation for its int erest in 
Section  232 investigations on the effect of imports of steel and aluminium products on national 
security. The Secretary of Commerce had initiated investigations under Section  232(b)(1)(a) of the 
Trade Expansion Act of 1962 to determine the effects  on national security of steel and aluminium G/C/M/129  
 
- 31 - 
 
  imports. As required by the statute, the investigation would consider a number of factors, 
including the following:  
(i) The domestic production needs and capacity of domestic industries to meet such 
requirements  existing in anticipated availabilities of human resources, products, raw 
materials, and other supplies and services essential to the national defence, the 
requirements of growth of such industries and such supplies and services included in 
the investment,  exploration, and development necessary to assure such growth, and 
the importation of goods in terms of their quantities, availabilities, character, and use 
of those affect such industries in the capacity of the US to meet nationa l security 
requirements;  
 
(ii) the close relation of the economic welfare of the nation to the US  national security, as 
well considering the impact of foreign competition in steel and aluminium on the 
economic welfare of  individual domestic industries;  
 
(iii) any substantial unempl oyment, decrease in revenues of government, loss of skills or 
investment, or other serious effects resulting from the displacement of any domestic 
products by excess ive steel and aluminium imports;  
 
(iv) the status and likely effectiveness of US  efforts to  negotiate a reduction in the levels 
of excess steel and aluminium capacity worldwide.  
 
16.21.   The Secretary of Commerce had initiated these investigations in light of the critical role 
steel and aluminium served in the US  national security industrial base, and the continued increase 
in steel and aluminium imports. The Department of Commerce had issued official notices notifying 
the public of the investigations and public hearings and soliciting public comments. Public hearings 
were held, on 24  May 2017 for steel , and on 22  June 2017 for Aluminium, with 37 and 
32 witnesses, respectively.  
16.22.   Close  to 200  written comments had been submitted on the steel investigation and about 
60 comments had been submitted on the aluminium investigation, and a representative of the 
Russian Federat ion had testified at both hearings.  
16.23.   The Secretary of Commerce would report to the President on the findings of the 
investigation.  
16.24.   If the Secretary of Commerce found that steel or aluminium was indeed being imported 
into the United States in su ch quantities or under such circumstances as to threaten to impair the 
national security, the Secretary would recommend actions and steps to be taken to adjust the 
imports of steel and aluminium so that those imports would no longer threaten to impair the 
national security.  
16.25.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
16.26.   The Council so agreed . 
17  UNITED STATES OF AME RICA – TRADE DISTORTING MEA SURES – REQUEST FROM 
THE PEOPLE'S REPUBLI C OF CHINA  
17.1.   The Chairperson  informed the Council that , in a communication dated 19  June 2017, China 
had requested the Secretariat to include this item on the agenda.  
17.2.   The delegate of China  reminded delegations that China had already brought to the Councils'  
attention its concerns over US trade -distorting measure s. China believed that the USTR  2017 
President Trade Policy Agenda submitted to US  Congress , and its implementation , had sent 
troubling signals with regard to the US' commitments to its international obligations, to 
safeguarding the authority of the WTO  Dispute Settlement Mechanism, and to its adherence to the 
cause of multilateralism. China was concerned about the trajectory of the US' trade policies and 
their potential impact on the global economy an d world trad e. G/C/M/129  
 
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  17.3.   The four  issues that China wished specifically to raise were in reference to the following : 
US Seafood Import Monitoring Program (SIMP); abuse of trade remedy measures; failure to 
implement the obligation under Article  15 of China's Accessio n Protocol to stop using "surrogate 
country" methodology in anti -dumping investigations; and Section  232 investigations on the effect 
of imports of steel and aluminium products on US  national security. China had raised these 
concerns on various occasions, including in this Council and in its subsidiary bodies, but these 
concerns were still to be addressed by the US.  
17.4.   Regarding the SIMP, published by the US  National Oceanic and Atmospheric Administration 
in February  2016, China believed that: (i)  it lacked tr ansparency as it was a conformity 
assessment procedure (CAP) that had been published within the US but never notified to the 
TBT Committee ; nor had the US, according to the TBT  requirement, provided Members with at 
least a period of 60  days for comments an d a six month transition period ; (ii) it was inconsistent 
with the non -discrimination principle. The US  requirement of traceability and catch certification for 
species at risk only applied to imported fish and fish products, but not to domestically caught and 
sold products. This was inconsistent with the WTO  principle of national treatment ; (iii) it lacked 
scientific justification as it was applicable to all imported aquatic products regardless of the ir 
respective  risk levels or the difference between aquac ulture products and wild capture fisheries. 
Thus, the US  should remove the aquaculture products from the list of species ; (iv) it posed 
unnecessary barriers to international trade because it required excessively burdensome 
information and data to be filed and retained for imported aquatic products given the huge 
difficulty in getting complet e information on traceability.  
17.5.   The program also overlapped with other US  regulations, and the above -mentioned issues 
significantly increase d the time cost and cost of fu nds for enterprises exporting to the US and also 
constituted unnecessary restrictions on international trade.  
17.6.   Regarding trade remedies, China was concerned about the abusive US use of these 
measures, including with respect to subsidy investigations, the de signation of public bodies, the 
selection of external benchmarks, and the identification of the specificity of a subsidy.  
17.7.   With respect to anti -dumping investigations, China urged the US to fulfil its WTO  obligations 
on trade remedy investigations, to incre ase transparency, and to stop using such practices as 
separate rates, the abuse of adverse facts available, the addition of the VAT  export rebate, and the 
addition of preferential rates to the dumping margin in anti -dumping investigations. According to 
recent statistics, since the new US  administration had taken office, the US  Department of 
Commerce had initiated 24  anti-dumping and countervailing investigations against products from 
12 Members. Of those , seven  investigations had targeted China , and in those anti -dumping and 
countervailing investigations against China, the US  investigation authority (IA) had adopted 
irrational practices and artificially increased the rates of anti -dumping duty and the rates of 
countervailing duty. For example, in the bia xial integral geogrid products case, the anti -dumping 
duty rate for all enterprises concerned was as high as 372.8%, and the countervailing duty rate, 
as high as 152.5%. In the amorphous silica fabric case, the anti -dumping duty rate was as high as 
162.47% , and the countervailing duty r ate, as high as 165.39%.  
17.8.   In addition , China had noticed that the US had recently initiated Section  201 investigations 
on Crystalline Silicon Photovoltaic Cells and Modules. Members should remember that the 
Section  201 Investi gations on steel and iron products launched by the US back in 2002 had 
triggered a surge of steel safeguard measures globally. China was concerned by the possible 
negative impact on the flow of international trade of such trade restricting actions as they reflected 
the protectionist  bias of US  trade policy. She asked the US to clarify the reasoning behind and 
legitimate goals of the increasing number of trade restrictive measures it had recently taken.  
17.9.   On 16  January  2015, the WTO  DSB had adopted the Appella te Body (AB) report and panel 
report on DS437, US—Countervailing Duty Measures  on Certain Products from China . In that case, 
15 US countervailing measures against China were found to be in violation of WTO  rules. To 
comply with the case rulings, the US  had reinitiated the investigations. However, the US  had 
continued with its practices , although they had already been found to be in violation of WTO  rules, 
and specifically its practices on such key issues as public bodies, external benchmark s, and the 
specificity of raw materials ; it had then upheld the original investigation determination , and 
continued to apply the countervailing measures to the  products  in question . China was concerned G/C/M/129  
 
- 33 - 
 
  about such practices, which n ot only unfairly impaired C hina's national and industrial interests but 
also harmed the rules-based multilateral trading system.  
17.10.   Article  15 of China's Accession Protocol was a sunset clause for the "surrogate country" 
methodologies in anti -dumping investigations against Chinese impo rts, and after 
11 December  2016, Members were no longer to use "surrogate country" methodologies in their 
anti-dumping investigations against Chinese products and companies. This had been agreed 
16 years ago in a bilateral agreement between China and the U S. The deadline had been clearly 
set. The words had been written in black and white. Sixteen  years ago, the US  negotiators at the 
time had also delivered a clear statement to Congress.  
17.11.   Chinese companies had waited 15  years for this "sunset". All they were asking for was that 
the US honour its commitment. China had emphasized that it was a legal issue and therefore 
should not be politicized. It was an international obligation that should not be circumvented by 
reference to domestic law. It had nothing to do with the so -called "market economy status" (MES), 
so the US should not use the "MES"  requirement in its domestic laws as an excuse to stop 
honouring its international obligations. China urged the US to respec t its obligations under 
Article  15 of China's Accession Protocol and to stop using "surrogate  country" methodologies in 
anti-dumping investigations against Chinese companies, and to do so in a timely manner.  
17.12.   In conclusion , and as China had already indicated under agenda item  16, China was highly 
conce rned about the Section  232 Investigations on imports of steel and aluminium products to 
assess the impact of imported products on US  national security, and urged the US to take a 
prudent and restrained attitude toward the use of trade policy tools, to assess the impact of the 
Section  232 investigations in a cautious and fair manner, to avoid triggering a surge of trade 
barriers put up in the name of national security, and to refrain from negatively affecting the flow of 
international trade  and, in particula r, the trade in steel and aluminium products.  
17.13.   The delegate of the Russian Federation  shared China' s concerns over the US  SIMP and 
recalled that her delegation had raised certain issues in that regard at the CTG  meetings of 
April and November 2016 and of April 2017.  Russia reaffirmed its interest in this issue and wished 
to see how the measure would be implemented in practice, especially the data verification aspect 
requiring proof that fish and seafood were not from IUU  fishing. Russia believed that , in the 
absence of such verification, new requirements could be considered simply as excessively 
burdensome for importers, exporters, and processors of seafood  alike, and especially for SMEs.  
17.14.   The Russian Federation was of the view that the measures on comb ating IUU  fishing 
should be an essential part of a government's fisheries management policy. Nevertheless, such 
measures should comply with the relevant provisions in the WTO  Agreements, should be drawn up 
in close cooperation with other countries and shou ld not be more trade-restrictive than necessary.  
17.15.   The delegate of the United States,  when referring to the SIMP , indicated that concerns with 
regard to this program  had already been raised in the past in the CTG and that the US had 
addressed them previously , both in the TBT  Committee and in this Council. The US  position had 
not changed since then.  
17.16.   As stated earlier by the US, there was a rising trend among WTO  Members, both in 
number and types of action, to find ways to address the injurious and systemic imp act that 
imports were having on Members ' systems. Much of this impact was a result of the unnecessary 
creation of an overcapacity situation in strategic and sensitive industries. Such overcapacity could 
have been avoided had Members simply operated under market-oriented principles. As this  had 
not been the case the need for action had escalated. The types of action being contemplated by 
the US simply underscored how past attempts to deal with this challenge had b een inadequate.  
17.17.   The US believed that all these concerns could have been avoided , and that they showed 
the seriousness of the situation now facing the US,  where seldom used tools were now needed as 
other conventional tools had proven inadequate. In any case , the US believed that the CTG was 
not the appropriate forum in which to discuss a matter that was currently before the DSB , where 
the US had already presented this issue in great detail. In the DSB , the US had explained to 
Members that the expiration of a single provision of China's Protocol of Accession to the WTO did 
not require Members to grant China market economy status, or to discontinue using a non-market G/C/M/129  
 
- 34 - 
 
  economy methodology. Rather, the WTO  Agreements permitted Members to treat China as a 
non-market  economy for as long as the facts on the ground showed that such was the case. The 
US referred delegations at the CTG  level to the statement that it had made in the DSB, and which 
it would be glad to provide.  
17.18.   The delegate of Japan  said that Japan was of th e view that the WTO  Agreement, including 
China's Accession Protocol, continued to allow WTO  Members to use methodologies that were not 
based on a strict comparison with domestic prices or costs in China.  
17.19.   The delegate of China , with regard to the US  respons e and Japan' s intervention , indicated 
that China looked forward to hearing from the US  side with regard to any updates on the SIMP, 
and indicated that the over -capacity issue had already been discussed at length . China reiterated 
its position that overcapa city should never be used as an excuse for any protectionist or abusive 
use of trade remedies. The US and Japan had stated that the WTO allowed Members to use either 
the so -called market economy status or to treat any other Member as a non -market economy. 
However, there was no definition of the so -called "Market Economy Status " in the WTO  Rulebook , 
even if a definition  could be found in the domestic laws of certain Members. However, domestic 
laws could not supersede the international obligations undertaken by a Member over 16 years ago.  
17.20.   Rather  than pointing at other Members' trade policies, she invited the US to be an example 
of a Member faithfully implementing its international obligations , avoid ing the imposition  of trade 
protectionist measures , and avoidi ng to send protectionist signals to the rest of the world. China 
expected the US  delegation seriously to address China's  and other Members'  concerns with a view 
to preserving the multilateral trading system.  
17.21.   The Chairperson  thanked delegations for their in terventions and  proposed that the Council 
take note of the state ments made.  
17.22.   The Council so agreed . 
18  TEMPORARY ADMISSION OF CONTAINERS, PALLE TS AND PACKING MATER IALS – 
COMMUNICATION FROM A USTRALIA (G/C/W/738)  
18.1.   The Chairperson  drew the Council 's attention to document  G/C/W/738, dated 19  June 2017, 
which contained  a communication from Australia on the temporary admission of containers,  
pallets, and packing material.  
18.2.   The delegate of Australia  introduced the document , which contained an initiative that 
Australia believed would reduce trade costs, assist MSMEs, was environmental ly friendly , and of 
benefit to all. Packed goods were travelling faster and more frequently and to a greater spread of 
destinations than ever before. This included stackable containers for f ood, customized containers 
for car parts, and containers used to dispatch garments. With so many goods criss-crossing the 
globe, pallets, container , and packing costs had a significant impact on world trade and on the 
environment.  
18.3.   The aim of the initiative  was to establish binding international rules ensuring the duty -free 
temporary admission of containers, pallets , and packing materials. The concept behind it was 
simple: containers, pallets , and packing materials should be provided duty -free temporary 
admission at the border. This would reduce trade costs and bureaucracy at the border, the costs of 
which were normally passed on to businesses and consumers.  
18.4.   It would also assist MSMEs , which were disproportionately affected by bureaucratic red 
tape. Indeed, t he reduction of bureaucratic, costly, and inefficient measures was at the heart of 
this initiative. Businesses would also benefit from a clear universal approach. Currently, the 
disparate customs procedures between countries meant that businesses could not  be certain of the 
measures they would face.  
18.5.   As the initiative concerned the use of reusable containers, pallets , and packing materials, 
the initiative was environmental ly friendly  and reduced post -harvest losses and food waste by 
facilitating the use of c ontainers designed to protect their contents. Certain customs authorities G/C/M/129  
 
- 35 - 
 
  currently imposed duties on the return of empty containers, effectively penalizing this more 
sustainable method  of transport . 
18.6.   The initiative also built upon the achievements of the T FA, which provided for temporary 
admission of goods but did not specifically address the issue of containers, pallets , and packing 
materials.  
18.7.   It was also in line with a number of conventions in this area to which many Members were 
parties, such as the Revised Kyoto Convention, where 103  parties had provided recommended 
practice for temporary admission for containers, pallets, and packing. The relevant annex of the 
Istanbul Convention, with 50  parties, had also included temporary admission concerning 
containers, pallets , and packing. Moreover, in recognition of the volume of goods now shipped 
globally , and the overall significance of this issue , the International Chamber of Commerce (ICC) 
had also indicated a need for progress in this area.  
18.8.   Australia woul d hold an information session on this issue after the summer break; all 
Members would be invited to attend it and further details would be conveyed in due course. 
Australia would also welcome Members ' engagement in developing a formal proposal with the aim  
of securing an outcome at MC11.  
18.9.   The delegate of Switzerland  thanked Australia for introducing its communication and 
registered Switzerland's interest  in this issue. Switzerland was also of the view that avoidance of 
taxing temporary goods was a strong fac ilitating measure that would primarily benefit not only 
small companies, but especially small companies in developing countries , where the average size 
and value of parcels would be significantly lower. Switzerland looked forward to the information  
session  to be held in September so as to cont inue a discussion of this issue.  
18.10.   The delegate of Chinese Taipei  thanked Australia for its efforts to facilitate international 
trade by submitting this proposal. Her delegation shared the Australian approach, supported the 
proposal, and would welcome an  outcome on this issue at MC11.  
18.11.   Chinese Taipei made additional  comments about packing materials for future 
implementation at the border by customs authorities. Customs officials in her Capital had indicated 
that they could  easily identify the containers and the pallets but that this was not the case for 
packing material s. Australia's proposal did not contain any definition or scope for the term 
"packing material "; this could be due to the multiple use s and broad scope of the packing 
material s themselves . Chinese Taipei believed that the term "packing material ", subject to 
temporary admission , should be clearly identified and that there was a need for a clearer  scope 
and understanding of what constituted " packing materials ". She hoped that Australia would 
consider these arguments and further develop a formal proposal. Her delegation looked forward to 
working constructively with Australia in this regard.  
18.12.   The delegate of Japan  expressed Japan's interest in the Australian initi ative. Indeed, the 
temporary admission of containers, pallets , and packing materials , could well facilitate trade and 
lower trade costs , which Japan believed should be  explore d. Japan therefore supported this 
initiative but was of the view that the coverag e of the temporary admission, in particular for 
pallets and packing materials, needed to be carefully examined throughout the discussions, and 
particularly in light of the international conventions and individual schemes of each country  that 
were already i n place . Japan looked forward to engaging in this work with other M embers.  
18.13.   The delegate of New Zealand  thanked Australia for having explained its proposal and 
indicated that this could both facilitate trade and reduce costs for business and consumers. A 
reduction in red tape and bureaucracy would add value for SMEs, particularly those in developing 
Members , who were often disproportionately affected by these kinds of trade barriers. New 
Zealand looked forward to participating in the ongoing dialogue on this proposal prior to MC11.  
18.14.   The delegate of the European Union  thanked Australia for its submission and i ts worthy 
objectives. However, the substance of the emerging proposal need ed to be further developed and 
clarified. Currently , it did not seem necessary, nor timely, to seek to build on, or to complement , 
the TFA, which already contained a closely related commitment. Given that the Istanbul 
Convention on Temporary Admission remained the primary instrument to assist Members to enjoy  G/C/M/129  
 
- 36 - 
 
  the benefits in question, it would be appropriate to consult first with the World Customs 
Organization , which administered it . Such technical analysis and support would be pertinent to the 
proposal.  
18.15.   The delegate of the Russian Federation  welcomed the initiative to discuss way s to reduce 
costs and facilitate logistical processes, an issue that had already been covered by the Istanb ul 
Convention on Temporary Admission and some other international t reaties. Given that not all 
WTO Members were parties to these treaties Russia believed that a consideration of the 
elimination of duties and other taxes on containers and pallets used in th e transportation of goods 
at the multilateral level , within the WTO  framework , would improve the business climate and 
facilitate trade. The initiative would also contribute to improving the predictability of engaging in 
trade across the board. Russia suppo rted the idea, saw it as a possible deliverable at MC11, and 
looked forward to receiving the textual proposal so as to continu e a discussion of this issue.  
18.16.   The delegate of Singapore  welcomed all initiatives , such as that from Australia , under 
discussion, w hich would contribute to trade facilitation  and, in particular, Singapore welcomed 
those initiatives that responded directly to commercial realities in contributing to a facilitation of  
MSMEs' participation in international trade. Singapore looked forward to engaging with Australia 
and other interested Members on this issue.  
18.17.   The delegate of the Republic of Korea  supported Australia's initiative on temporary 
admission for containers, pallets , and packaging materials. Korea believed that eliminating 
obstacles to the admission of containers, pallets, and packaging was necessary to fulfil the purpose 
of the TFA. Korea would cooperate closely with Australia and other Members in the discussion in 
the information session foreseen , and whose intention would be to develop a more specif ic 
proposal on this initiative.  
18.18.   The delegate of China  indicated that, in principle, China could support Australia's proposal , 
the main aspects of which were currently being examined in Capital. As a preliminary comment , 
she indicated that Article  10.9 of the TFA provided disciplines for the temporary admission of 
goods. China would appreciate clarification from the Secretariat regarding the relation between the 
definiti on of "goods" in the said Article , and the containers, pallets , and packing material s that 
were the focus of the Australian proposal.  
18.19.   The delegate of Guatemala  welcomed the proposal and indicated that it was necessary to 
identify the tariff code s for conta iners, pallets  and, in particular , for packing material. Guatemala 
was analysing the issue bearing in mind that the products in question formed part of the 
NAMA  negotiations. Like China and Chinese Taipei, Guatemala requested clarification of these 
issues and indicated that it would engage fully in any discussion of this topic.  
18.20.   The delegate of the United States  thanked Australia for its submission , which was  intended 
to contribute towards the development of a formal proposal for Members' consideration. In t his 
regard , the US was concerned by  the disruptions that such a proposal might create in relation to 
the ongoing efforts by Members to implement the TFA. The US asked Australia to be mindful of the 
WTO collective priority to see the TFA  ratified and implemented by all WTO  Members. Members 
already had processes under way to implement the TFA, including stakeholder consultations in 
order to complete their Category  B Notifications relating to transition periods. Moreover, numerous 
Members were still in t he process of formalizing domestic acceptance and ratification of the 
Agreement. The US remained concerned about any proposals that could detract from the very 
important work that was currently being undertaken to implement the TFA and its ratification by 
all Members.  
18.21.   The delegate of South Africa  indicated that the Australian proposal was still being assessed 
in her Capital as for South Africa it raised certain questions and concerns. Her delegation reserved 
its right to revert to this issue  at a later stag e. 
18.22.   The delegate of Brunei Darussalam  thanked Australia for its proposal and its initiatives to 
further facilitate trade and looked forward to a further di scuss ion of  the issue with Australia and 
other interested Members . G/C/M/129  
 
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  18.23.   The delegate of Australia  thanked M embers for their interest and for their comments on its 
proposal. Australia looked forward to working on this initiative with all interest ed Members. The 
initiative built upon what had already been achieved in the TFA and the commitments that a 
number of M embers had already undertaken in other conventions. Australia believed that its 
proposal would bring clarity to an important aspect of the TFA. Modern times needed modern 
rules. Rules on temporary admission would provide clarity to business es, reduce costs  to 
economies, and help the environment. Australia looked forward to worki ng on this issue with all 
interested Members.  
18.24.   With regard to China's request for the Secretariat to provide clarification of some of the 
issues concerning the TFA, the Chairperson  indicated that it was primarily Members' responsibility 
to interpret WTO  Agreements. Consequently , the issue could be discussed at the information 
session proposed and to be organized by Australia. He also thanked delegations for their 
interventions and proposed that the Council take note of the statements made.  
18.25.   The Council so agreed . 
19  WORK PROGRAMME ON EL ECTRONIC COMMERCE4 
19.1.   The Chairperson  reminded delegations that , at the Council's previous meeting , the interim 
Chairperson had reca lled that Ministers in Nairobi had adopted the  decision contained in 
document  WT/L/977 on the "Work Programme on Electronic Commerce" (Work Programme , or 
WPEC). In that Decision, Ministers had reaffirmed not only the mandate of the "Work Programme 
on Elect ronic Commerce", adopted on 25  September  1998 and contained in document  WT/L/274, 
but also the subsequent Ministerial Declarations and Decisions on the Work Programme. Therefore, 
Ministers had decided to continue the work under the WPEC since the last sess ion, based on the 
existing mandate and guidelines and on the basis of proposals submitted by Members in the 
relevant WTO  bodies , as set out in paragraphs  2 to 5 of the Work Programme. To this end, they 
had instructed the General Council to hold periodic re views in its sessions of July and 
December  2016 and July  2017 and to report to the next session of the Ministerial Conference 
based on the reports that might be submitted by those WTO  bodies entrusted with the 
implementation of the Work Programme. In this vein, and in order to fulfil the mandate, he invited 
delegations to express their opinions and to make suggestions as to how to work on the 
preparation of the periodic reviews to be held in the General Council at its session of July  2017.  
19.2.   He also recalled that, at the last CTG  meeting , an extended discussion of E-Commerce had 
taken place , in which 27 delegations had taken the floor to explain the specifics of their 
submissions and/or to express their views on different aspects of E -Commerce. As indicated in  the 
meeting's Agenda, four  JOB documents had been submitted by a number of delegations and to 
various WTO  bodies, including this Council. He therefore invited those delegations that had 
submitted documents on this issue to take the floor first, to be followed by other delegations that 
also wished to provide comments and views on the proposals tabled or with re gard to any 
particular aspect or topic of E -Commerce, mindful of the fact that at the next meeting of the 
General Council he would , under his own responsibility, present a factual report of the discussions 
held in this Council.  
                                                
4 The following documents were submitted to the CTG:  
(i) COMMUNICATION FROM THE PEOPLE'S REPUBLIC OF CHINA (JOB/GC/110 – JOB/CTG/2 – 
JOB/SERV/243 – JOB/DEV/39);  
(ii) COMMUNICATION FROM ARGENTINA, BRAZIL AND PARAGUAY (JOB/GC/115 – JOB/CTG/3 - 
JOB/SERV/247 - JOB/IP/20 - JOB/DEV/41);  
(iii) COMMUNICATION FROM CANADA, CHILE, COLOMBIA, CÔTE D'IVOIRE, THE EUROPEAN UNION, 
THE REPUBLIC OF KOREA, MEXICO, THE REPUBLIC OF MOLDOVA, MONTENEGRO, PARAGUAY, 
SINGAPORE, TURKEY AND UKRAINE (JOB/GC/116/REV.2 - JOB/CTG/4/REV.2 - 
JOB/SERV/248/REV.2 - JOB/IP/21/REV.2 JOB/DEV/42/REV.2)  
(iv) NON-PAPER FROM BRUNE I DARUSSALAM; COLOMBIA; COSTA RICA; HONG KONG, CHINA; 
ISRAEL; MALAYSIA; MEXICO; NIGERIA; PAKISTAN; PANAMA; QATAR; SEYCHELLES; 
SINGAPORE; AND TURKEY (JOB/GC/117 - JOB/CTG/5 - JOB/SERV/249 - JOB/IP/22 - 
JOB/DEV/43);  
(v) COMMUNICATION FROM ASEAN (JOB/GC/126 – JOB/CTG/6 – JOB/SERV/260 – JOB/IP/23 – 
JOB/DEV/44).  G/C/M/129  
 
- 38 - 
 
  19.3.   The delegate of China  remind ed delegations that , in November  2016, China and Pakistan 
had submitted a communication on the WPEC to this Council, the CTS, the CTD , and the General 
Council. At the CTG  meetings of November  2016 and April  2017, China had provided detailed 
explanations of its proposal, and had reiterated its position that, at the current stage, the 
discussions on E -Commerce in the WTO should continue on the basis of the existing mandate, 
should uphold the development dimension, and should focus on the areas of common inter est to 
Members. China had also encouraged Members to exchange information and compare best 
practice on E -Commerce under the relevant WTO  bodies, so as to facilitate a better understanding 
of E-Commerce among Members, especially developing country Members , and thereby to enable 
the development of E -Commerce and benefit from it while fully reflecting the inclusiveness of the 
multilateral trading system.  
19.4.   The proponents and Members had made pragmatic contributions and provided inputs that 
had served as a basis for the discussions on E -Commerce. In turn, China wanted to share some of 
its practices in  the area of  facilitating cross -border trade in goods enabled by the internet, as 
China believed that this would stimulate discussion  of this topic with a view to seeking a possible 
landing zone of common interests.  
19.5.   As Members were aware, thanks to the increasing enthusiasm among  Chinese consumers 
for overseas products, and thanks also to an improvement in policy environment, cross-border 
E-Commerce had developed ra pidly in China and had now become a new engine in the expansion  
of foreign trade, and an important factor driving economic growth. The Hangzhou cross-border 
E-Commerce comprehensive pilot -zone was the most relevant example of facilitated development 
of cross-border E -Commerce in China. Located in the customs free -zone in Hangzhou, it was 
launched in 2014 as an imports business specialized in cross -border E -Commerce,  and currently it 
had up to 249,000  square meters' of bonded warehouses for cross-border E -Commerce purposes. 
In this pilot -zone, bonded stocking or bonded retail import was the main model for carrying out 
cross-border E -Commerce. It operated as follows: the merchants of cross-border E -Commerce 
platforms, also called "E -Commerce business operators", imported and transported batches of 
goods from overseas into the zone, based on international logistics, and then stored the imported 
goods in bonded warehouses.  Following receipt of an online  order from a customer, the 
E-Comm erce business operator , for inspection and clearance purposes, was required to submit to 
the customs authorities the relevant information regarding the order, including the freight bill, and 
payment  details , after which the goods were packed and delivered to the custo mer using domestic 
logistics.  
19.6.   In this process, "bonded warehouses" in the "free -zones" played an important role. As 
special customs regulatory areas located in a Member's territory but outside its customs territory, 
free-zones not only had facilitated imports of cross -border E -Commerce, but had also delivered 
threefold  benefits to the E -Commerce operators, customers, and regulators. For operators, 
imported goods could be stored in advance of purchase in the bonded warehouses located in the 
free-zones, and then be delivered directly to consumers upon electronic order. Consequently, t he 
intermediate stages of cross -border delivery had been decreased and the supply chain efficiency 
had been impro ved. For customers, the waiting time for the purchased  goods had been reduced 
and their shopping experience enhanced. For regulators, cross-checking the transaction 
information, logistics , and payment information, and ensuring the authenticity and effectiveness of 
trade had not only helped in the accuracy of trade statistics, but had also made the regulation of 
such trade more convenient and effective.  
19.7.   "Free -zones" and "bonded warehouses" were not new concepts; their definitions could be 
found in the "Specific Annex  D" to the Kyoto Convention, whose specific t itle was "International 
Convention on the Simplification and Harmonization of Customs Procedures". The free -zones and 
bonded warehouses had not only played an important role in traditional trade, but had also played 
a key role in facilitating the development of E -Commerce. This facilitating role comprised ensuring  
that the relevant goods were permitted to be stored, unpacked , and grouped, collected for 
repacking, and packed at free-zones and customs warehouses in the importing destinations. They 
then followed the standard importing procedures, including customs declaration, payment of 
tariffs , and internal taxes , in accordance with the electronically placed transaction orders , and then 
were transported from free -zones and customs warehouses for deli very to the buyer. Such 
free-zones and customs warehouses were also located sometimes in a third  territory , other than 
that of the importing or exporting country , but nevertheless offered the same facilities in support 
of the importation of the goods  as me ntioned earlier . G/C/M/129  
 
- 39 - 
 
  19.8.   Such a facilitation role might sometimes also include permitting relevant goods to be stored, 
unpacked , and grouped, collected for repacking, and packed in the free-zones and customs 
warehouses also of the exporting source, where  the relevant exporting procedures , including 
export declaration, export tax refund, and so on, would then be completed in due course . 
Following these operations , and based on the location of the electronically placed order , the goods 
could be transported and delivered to the final destination upon completion of all necessary import 
procedures, including customs clearance, tariffs , and internal tax payments. China believed that it 
was likely that other Members applied similar practices with regard to free -zones  and customs 
warehouses so as to facilitate cross-border E -Commerce.  
19.9.   In China, cross -border E -Commerce had promoted trade to the benefit of all participants. It 
had also encouraged a win -win cooperation among its participants.  China invited other Members t o 
share their experience in this area, and to promote and to deepen discussion as to how to facilitate 
E-Commerce  still more effectively.  China stood ready to continue its engagement with Members  on 
this subject  with a view to achieving positive progress in the WTO  context.  
19.10.   The delegate of Canada  said that an important exchange of views had taken place at the 
last CTG  meeting under this agenda item, and thanked Members for their submissions , and China 
for sharing its views on E -commerce. Canada observed an ongoing  interest among Members for 
substantive work on E -Commerce  to be carried out  in the context of the CTG. Fruitful discussions 
at past meetings had ranged over a number of topics , including electronic authentication, robust 
implementation of the TFA, the contribution of the ITA and its expansion, as well as the customs 
duty moratorium. Canada looked forward to continuing these discussions in future meetings of the 
Council.  
19.11.   The dele gate of the European Union  welcomed all communications but the new 
communication by ASEAN in particular, as it highlighted the benefits to SMEs and emphasized the 
importance of legal certaint y in regulatory frameworks.  
19.12.   The EU, a co -sponsor of document  JOB/CTG/4/Re v.2, welcomed the additional 
co-sponsorship by the Republic of Moldova and Ukraine, and expressed its satisfaction with the 
discussion generated by this proposal in the regular bodies. This communication had the 
advantage of mapping out all the rel evant issues pertaining to trade and the digital economy. 
Discussions had also referred to several elements relating to trade in services , where multilateral 
rules in the WTO  context would also be beneficial. This was reflected in this proposal, which had 
also been submitted to th e Council for Trade in Services –Special Session (CTS –SS). 
19.13.   The EU believed that the discussions on trade in goods needed to be deepened and 
intensified. In this vein, the EU welcomed China's submission on E -Commerce , which allowed 
Members the possibility to focus their attention onto more concrete and practical issues . The EU 
looked forward to engaging further on these concrete E -Commerce aspects of the trade in goods.  
19.14.   The delegate of Singapore , when referring to document  JOB/CTG/5 entitled "Electronic 
Commerce and Development", indicated that Singapore continued to support further discussion on 
the relationship between E -Commerce and development. With regard to Members ' interest in 
paperless trading and e -signatures, raised by some Members at previous meetings, Singapore had 
shared its experience on the National Single Window, and its effort s to upgrade this to a "National 
Trade Platform". Singapore would welcome hearing other Members ' perspective s and experiences 
with regard to these issues.  
19.15.   Regarding document  JOB/CTG/6, entitled "Can E -Commerce Trade Rules Help MSMEs from 
Developing Countries" , she informed Members that this paper had grown from a lunch  panel held 
during the UNCTAD E -commerce Week, on 27  April 2017. The event had be en organized by ASEAN 
with a view to find ing synergies between discussions in UNCTAD and WTO on the development 
aspect of E -Commerce. Thailand's Vice -Minister for Commerce had provided the opening remarks , 
and several panellists from the WTO, Singapore, Ca mbodia, the Global Express Association, and 
ITC, had  made presentations that had encouraged a broad discussion of the issue, including with 
regard to existing WTO  rules that apply to E -Commerce, and the common types of E -Commerce 
rules found in RTAs. Panel lists also referred to how E -Commerce had enabled MSMEs to int egrate 
more fully into the global economy.  G/C/M/129  
 
- 40 - 
 
  19.16.   The panel addressed  with interest the question of how E -Commerce cut across 
development levels in ASEAN, where there already existed some E -Commerce disciplines, such as 
the ASEAN  Australian -New Zealand FTA. Moreover, ASEAN  Members were looking to negotiate an 
ASEAN  E-Commerce Agreement. All these reflections were summarized in the submission and 
Singapore looked forward to engaging constructi vely with other interested Members on how in the 
WTO to take forward the work on E-Commerce.  
19.17.   The delegate of the Russian Federation  said that the number of submissions tabled clearly 
indicated Members' interest in E -Commerce. Most of the submissions had be en circulated 
horizontally to the WTO  bodies mentioned in the Work Programme. This confirmed that 
E-Commer ce was  a cross-cutting issue. 
19.18.   The submissions to the CTG contained topics that Russia would like to see explored 
further, such as creating an enabling  environment for MSMEs, streamlining customs procedures for 
the online trade in goods, including paperless trade and end-secure online payments, e -platforms, 
e-signature s, and e -contracts, online consumer protection, and privacy and security issues. 
Howeve r, the complexity of the topics , although  related to goods, did not exclusively fall within the 
goods context ; they might also raise and affect services, intellectual property, and development 
issues. Russia reiterated its view that E -Commerce discussions should primarily be held 
horizontally and in a n holistic manner. By identifying cross-cutting issues and appropriate ways to 
discuss them, Members could then finally move to exploring  the issue of  E-Commerce in 
substance.  
19.19.   The delegate of South Africa,  on behalf of the African Group (AG) , recalled the statement 
delivered at the last CTG  meeting on this issue5, and thanked the proponents for their 
submissions. And, in the view of the African Group, tabling these documents  in the CTG was  fully 
in accordan ce with paragraph  1.1 of the WPEC, as reaffirmed in paragraph  1 of the Nairobi 
Ministerial Decision.  
19.20.   She recalled that , for the African Group , the appropriate exploratory approach for 
discussions under the WPEC was one giving paramount importance to the development 
implications of E -Commerce, taking into account the economic, financial, and development needs 
of developing countries. In this vein , the African Group had invited Members to exchange their 
views and experiences in the CTG on the basis of the c urrent Work Programme. The African Group 
believed that priority should be given to a complete assessment of the wide-ranging disruptions 
that would result from the Fourth  Industrial Revolution, the growth of digital trade, and 
E-Commerce.  
19.21.   As discussions co ntinued under the Work Programme, the African Group wanted the CTG  
to take up the issues related to the needs of developing and  least developed countries on 
E-Commerce and to place them at the centre of the discussions, and especially the challenges of 
the digital economy for developing and least -developed countries , the possible ways to enhance 
their participation in E -Commerce, in particular with regard to exporters of electronically delivered 
products, and the role of improved access to infrastructure, t ransfer of technology, and the 
movement of natural persons.  
19.22.   An informal meeting of the African Group on digital industrial policy and development that 
had taken place the previous day had served two  purposes: it was the first  concrete step towards 
scoping the depth of the challenges faced by developing countries and the digital divide, 
particularly for countries that were striving to industrialize, and it also helped to identify the types 
of national measures that some Members had employed to build their national capabilities so as to 
place themselves in a leadership position in today's global E -Commerce landscape . During the 
discussion it had become apparent that, much as a digital transformation was under way, and that 
digital  technologies and solutions were emerging, many of these would be seriously disruptive to 
many economies around the world, and that developing countries and LDCs were still confronted 
by the reality of a deep, widening, and persistent digital and technolog ical divide.  
19.23.   Discussions had also shown that Members' paths towards achieving global leadership in the 
digital economy had not all been the same, and that active policies and deliberate efforts were 
required to develop the necessary infrastructure and to m anage digital flows for a national digital 
                                                
5 See document  G/C/M/128 , paragraphs  20.63–20.68 . G/C/M/129  
 
- 41 - 
 
  catch up. Other lessons learnt were that global integration needed to be preceded by the building 
of national capabilities through what was described as a " digital industrial policy ". The importance 
of digital rig hts and how a balance needed be found on the international a genda with regard to 
issues pertaining to E -Commerce and internet governance had also eme rged from the panel 
discussion.  
19.24.   The African Group looked forward to seeing more engagement on these issues and 
encouraged Members to share their experiences with regard to  specific policy, regulation, 
infrastructure development, and measures that they had used in order to achieve digital 
integration and advancement . The E -Commerce discourse had compelled the Af rican Group to 
consider the importance of digital rights, since data was the raw material of the digital economy, 
and there was value held in its control, management, and flow.  
19.25.   Given the extremely high market concentration levels existing in the current gl obal 
E-Commerce space, evident both in terms of how E -Commerce trade was distributed across the 
global economy and in terms of the number of firms that dominated the space in terms of their 
capitalization , the African Group believed that it would benefit from a discussion of these issues as 
it explore d its own policy options through which to respond to changes brought on by the so-called 
Fourth  Industrial Revolution, vis -à-vis Africa's long-standing developmental objectives of industrial 
development, structural transformation, and employment.  
19.26.   The delegate of Tanzania,  on behalf of the LDCs  Group , recalled the statement delivered at 
the last CTG  meeting and requested that it be included in  the records of this meeting.6 He 
indicated that the WPE C had allowed its Members sufficient opportunity to engage in an extensive  
and exhaustive discussion of E-Commerce. The WPEC had no negotiating mandate and its 
discussions were exploratory in nature.  
19.27.   He noted that the E-Commerce phenomenon in theory provid ed a critical gateway for 
consumers and businesses in weak er countries , allowing them to surmount some of the obstacles 
they traditionally faced when competing internationally and with enterprises from among the 
strong er players in the trading system. Howe ver, in reality, most LDCs faced a number of 
constraints due to insufficient basic infrastructure and access to the internet, and the high cost of 
broadband connectivity, among others. These obstacles acted as bottlenecks that hindered LDCs 
from taking advantage of the opportunities th eoretically available to them through E -Commerce 
flat platforms.  
19.28.   Different agencies had organized various seminars that had benefitted LDCs; during these, 
it had become apparent that there were Members, including developing  Members , which had 
generated a lot of revenue from E -Commerce. What had not been clearly indicated was the kind of 
domestic regulatory policy frameworks that had been adopted by those Members, especially the 
developing countries that afforded their domest ic industries the necessary policy space and 
protection to grow and to thrive until such a time that they had become strong, emerging , or 
dominant players. The LDC  Group therefore requested that major players share their experience 
with regard to the digit al industrial policies that they had put in place and that had helped to 
guarantee their digital rights and to ensure their current prosperity.  
19.29.   In this context , the LDCs  Group appreciated the panel discussion organized by the African 
Group on digital indus trial policy and development. For the first  time in the WTO, Members of the 
LDCs Group had had the opportunity to listen to a realistic narrative on E -Commerce, according to 
which the benefits were neither self-evident nor automatic, and that countries had  to undertake 
deliberate measures with a view to ensuring and guaranteeing that there was a trickledown effect 
from those benefits. As envisaged under the 1998  WPEC, t his was precisely what his Group had 
always suggested in this Council and at other regular bodi es. 
19.30.   One thing learnt from the panel discussion was that the digital divide between developed, 
developing, and least developed countries , was huge and still growing, and that if it was not 
addressed it would create even bigger future divides, su ch as in the areas of technology, income, 
workforce, and infrastructure , between those who had and those who did not have the necessary 
infrastructure. In other words, inequality would increase and most developing and least developed 
countries would be lef t further behind because multilateral rules would entrench these imbalances. 
                                                
6 See document  G/C/M/128, p aragraphs  20.69–20.77 . G/C/M/129  
 
- 42 - 
 
  The existing global E -Commerce space was extremely asymmetrical and the gains were not shared 
equitably.  
19.31.   A further lesson learnt was that data was the raw material of the future , and that the way s 
in which countries treated, managed , and exported data would determine their development path 
in the digital age. It was also of note that there was not a single prescriptive theoretical policy or 
regulatory approach that would be a guara nteed recipe for success, but rather that Members had 
used policy space to nurture and develop their domestic industries. While development might 
mean different things to different Members, the implication s of the Fourth  Industrial Revolution, 
which would be driven by the digital age, would be far reaching. It was therefore important for 
Members to develop industrial policies and to avoid constraining their policy space in their digital 
economies . 
19.32.   His Group had previously stated that most of the submissions  on the table fell outside the 
scope and mandate of the Work Programme. He therefore reiterated the request to Members to 
narrow their submissions to issues specific to each particular body and that , if this were not 
possible, to focus on the development -related aspects of the Work Programme with a view to 
examining ways to achieve  improved access to infrastructure, transfer of technology, movement of 
natural persons, and use of information technology in the integration of developing and least 
developed cou ntries  into the digital economy . These issues were at the heart of the discussion on 
the digital divide and they needed to  be resolved so as to build on E -Commerce -readiness before 
LDCs would be in a position to engage in any kind of  rules-setting in this area. 
19.33.   The delegate of the Bolivarian Republic of Venezuela  indicated that his authorities were 
looking at E -commerce issues in a holistic manner, and were also examining in detail the various 
proposals submitted by Members to this Council and other WTO  bodies, as well as the outcomes of 
other discussions of this issue taking place in parallel in other multilateral organizations. 
Technological development was under way, the results of which had yet to be quantified by most 
Members. E -Commerce was only a part of a more complex revolution, but unfortunately not all 
Members were ready and prepared for this revolution, and confronting it on equal conditions. 
Given these many complexities, Venezuela called upon Members to reflection further upon these 
issues and t o proceed with great caution and acting always within the boundaries of the existing 
Work Programme. As South Africa and Tanzania had already indicated , Venezuela considered that 
this Council was required to consider the interests of developing and LDC  Members and to engage 
with those Members in an exchange of experiences.  
19.34.   The delegate of Chinese Taipei  thanked ASEAN for its submission on the subject of  how 
E-Commerce could help MSMEs. In this regard first UN -MSMEs  Day had taken pla ce the previous 
day, where the discussion addressed the question of how  E-Commerce had changed the way of 
doing busines s in the modern world , and also the experience of how E -Commerce had allowed 
MSMEs , as well as young entrepreneurs , to gain access to the global market for the ve ry first time.  
19.35.   She stated that Chinese Taipei believed that the WTO could and should play a crucial role 
in the promotion and facilitation of E -Commerce, and that it was important to narrow the gap in 
digital connectivity. Ways had to be found to bridge  the digital divide so as to help LDCs and 
developing Members gain access to the necessary ICT infrastructure and services so as to enhance 
their E -Commerce readiness. The m ost useful way to analyse the E -Commerce topic was by 
examining  the fundamental dif ferences that existed between E -Commerce and traditional trade.  
19.36.   The availability and efficiency of digital transmission had created a new trading method as 
well as more opportunities to trade, such as  in the case of  e-books, 3D  printers, tele -medicine, 
cloud computing, and so on . E-Commerce had not only blurred custom s borders but had also given 
rise to "barriers to digital trade" which were quite different from those that occurred in the context 
of traditional trade , where customs duties and/or non -tariff barriers were familiar and well known  
challenges . Indeed, most of the "cyberspace trade barriers" were applied during the early stages 
of the transactions and usually in the context of  comparing the price or location of  an order. In 
other words, when certa in barriers were applied that restricted access to data or information on 
the internet they actually prevented potential buyers from becoming aware of the existence of a 
foreign commodity. If the necessary data or information was not transmitted efficientl y, any 
comparison of goods or services in subsequent  orders and shipments was not possible . Thus, such  
a "cyberspace trade barrier" could often and at an early stage completely wipe out all competing 
trade opportunities. This was a serious problem for MSMEs , which might not have any other G/C/M/129  
 
- 43 - 
 
  channels  through which  to access potential foreign buyers. Consequently, Chinese Taipei 
considered it to be of fundamental importance that the WTO ensure that all Members enjoy 
reciprocally equal access to the internet .  
19.37.   Her delegation looked forward to further dis cussion of  the proposal with other Members.  
19.38.   The delegate of Japan  said that it was meaningful and useful to concen trate the discussion 
at the CTG  level on the positive impact of E-Commerce on the trade in good s, and how to address 
the technical i ssues created by the development of E-Commerce and digital trade. In this vein , 
Japan thanked China for its explanation of its experiences with E-Commerce  and, in particular , 
China's experience in the area of cross-border zones. Japan was ready to engage fully in such 
discussion s in the context of the CTG.  
19.39.   The delegate of Norway  welcomed the new submission from ASEAN. Norway considered it 
useful, as part of experience -sharing, to hear more about the work towards and the objectives of 
an ASEAN  Agreement on E -Commerce, and whether such work might also draw upon parts of the 
WTO Agreements. Norway considered that Members should now concentrate on  the following:  
development and MSMEs  issues ; how E -Commerce was an enabler for trade ; and what was 
required from domestic and global regulations to support these aspects of E -Commerce. Such a 
discussion  would include concrete technica l conditions for cross-border E -Commerce, such as 
electronic signatures, authentication, and certific ates that pertained to E -Commerce, both for 
goods and for services.  
19.40.   The WTO worked with rules but did not work in an isolated environment. Therefore, it was 
important to take into account a wide general perspective  that included  what was being done by 
governments, and domestic and international businesses, as well as by bilateral and multilateral 
development organizations , to put in place the necessary infrastructure and capacity in developing 
countries. This exchange of information should continue in seminars and at the Council.  
19.41.   The delegate of Hong Kong, China,  also thanked ASEAN for its submission , focusing on 
MSMEs from developing countries , and  which highlighted not only the opportunities but also the 
critical challenges for MSMEs in the area of E-Comm erce. Since there were a large number of 
MSMEs in Hong Kong, China,  her delegation supported all initiatives that help ed to create a reliable 
business environment so that MSMEs could effectively leverage E-Commerce in order successfully 
to access global markets.  
19.42.   The delegate of New Zealand  thanked the proponents for their submissions, some of which 
had been co-sponsored by a number of both developed and developing Members. Previous 
discussions in the CTD, CTS, and TRIPS  Council, had reinforced the diversi ty of interests in the 
area of E-Commerce , as well as its broad relevance across the membership. These discussions had  
also underscored the wider transformative effect of digital technologies and services on Members' 
economies. He therefore  welcomed the ne w ASEAN  submission.  
19.43.   New Zealand also welcomed the messages  that had come  from the UNCTAD  panel 
discussions , which had demonstr ated the ongoing relevance of E -Commerce to the WTO  agenda , 
as well as the need for further work in the WTO  on a liberalization an d facilitation agenda, as these 
too both affected and were affected by E -Commerce.  
19.44.   Further to a Work Programme of some 20  years, it was now time for the WTO seriously to 
address the digital economy. Members needed to consider how to move from a general dis cussion 
in this Council and at other W TO bodies to more co ncrete and focused work on MC11  deliverables, 
including laying a path for future work.  
19.45.   The delegate of Australia  again thanked proponents for their submissions and 
presentations. She recalled Australia's intervention at the previous CTG meeting on the  subject of 
these  submissions and also welcomed the ASEAN  document. In view of MC11, Australia welcomed 
the ongoing engagement by Me mbers on E -Commerce issues and reiterated the role of 
E-Commerce in promoting inclusive global growth.  
19.46.   The delegate of India thanked the proponents for their submissions. India agreed that 
E-Commerce was indeed becoming a major driving force in internation al economic activity, G/C/M/129  
 
- 44 - 
 
  including international trade. Even in India itself,  E-Commerce was transforming the way business 
was done and was one of the fastest growing segments of the economy, witnessing  exponential 
growth over the past few years. However, as with any new and emerging area of technology, the 
regulatory frameworks and institutions to support E -Commerce were still at an evolutionary stage.  
19.47.   It was also well known that most developing countries and LDCs were grappling with basic 
access and connecti vity issues , such as providing an uninterrupted power supply, improving patchy 
internet connectivity , and enhancing bandwidth. In India, around 70% of the population , often in 
rural areas,  did not have access  to the internet . There  was therefore a huge dig ital divide within 
and among WTO  Members and this digital divide needed to be bridge d. Furthermore, the growth of 
E-Commerce activities had given birth to new challenges, both for domestic as well as 
cross-border trade, including issues relating to consume r protection, sale s of counterfeit goods and 
services, safety of online payments, balancing cross-border data flows and privacy concerns, 
digital signatures, taxation of the digital economy, issues relating to a lack of skilled workforce , 
human resource de velopment, and logistics. In India, as in most developing countries, regulatory 
frameworks on these and related areas were still evolving. There was therefore  a need to discuss 
how Members had addressed these issues domestically and especially within a developmental 
context.  
19.48.   Given that the growth of E -Commerce activities and digital trade had given birth to many 
new challenges, cooperation among WTO  Members through a sharing experiences and best 
practice relating to the issues mentioned above would be of particular value . Members should 
focus on collectively address ing ways to reduce  the digital divide and promote increased internet 
access, as well as on enhancing  ways of financing the needs of developing countries, in particular 
LDCs, so as to ensur e that the necessary  digital infrastructure  was in place . 
19.49.   India agreed that E -Commerce could become a driver of inclusive growth and sustainable 
development. However, in order to realize its full potential, significantly larger efforts were 
required by nat ional governments and the international community to enhance the readiness of 
many developing and least -developed countries and to bridge the digital divide; only then would 
these countries be in a position to engage in and benefit fr om multilateral rules in the area of 
E-Commerce.  
19.50.   The delegate of  the Republic of Korea  reiterated that Korea was actively engaged in the 
discussion on E-Commerce with a view to achieving a meaningful outcome on E-Commerce at 
MC11 . Korea therefore welcomed the various proposals  that had been tabled  and recognized their 
value. Korea believed that Members should exchange their experiences in E -commerce at the CTG 
and hoped that the discussions in this Counci l would contribute to the larger and overarching 
E-Commerce discussion. Gi ven the holistic nature of E -Commerce, Korea was of the view that 
Members needed to explore the issue of the appropriate forum for this discussion and what would 
be a feasible path toward s a substantive outcome on E -Commerce at MC11 and beyond. Korea 
would  continue to be constructively engaged in this discussion.  
19.51.   The Chairperson  thanked delegations for their interventions , which had contributed to a 
new round of rich discussion on  the subject of  E-Commerce. Based on the interventions , he 
considered that the re continued to be a very significant interest among Members on this issue , 
including with regard to an exchange of  experiences, practices, and viewpoints . However, 
differences remained as to perspectives and priorities and he had not observed any indicati on of 
an emerging convergence in any particular direction. He therefore encouraged all delegations to 
continue to reflect on this issue, to talk to one an other, and to build on common elements. His 
doors would remain open to any delegation wishing  to appro ach him and to share with him its 
views and proposals on this issue. He proposed that the Council take note of the statements made.  
19.52.   The Council so agreed . 
19.53.   The Chairperson  reminded delegations that, as indicated in his opening remarks on this 
issue, in order to fulfil the Nairobi Mandate, and based on the discussions held in  this Council in 
April and July  2017, it was his intention to make, on his own responsibility, a factual report  to the 
General Council in July  2017; he asked the Council if this could  be agreed.  
19.54.   The Council so agreed . G/C/M/129  
 
- 45 - 
 
  20  OTHER BUSINESS  
20.1.   The Chairperson  informed the Council that its next meeting had been scheduled to take 
place on Thursday , 9 November  2017. The agenda would close on Friday , 27 October  2017.  
20.2.   With regard to the closure of the  CTG Agenda, he reminded delegations that, according to 
the Rules of Procedure, meetings of WTO  bodies were convened by a meeting notice (Ai rgram) 
issued not less than ten  calendar days prior to the date set for the meeting. The agenda itself 
therefore clo sed one  WTO working day prior to circulation of the meeting notice; in other words, 
11 calendar days before the date set for the meeting (or, if the date fell on a weekend, the 
previous Friday).  
20.3.   The meeting was closed . 
__________