WT/REG297/2  
28 June 2013  
(13-3386)  Page: 1/6  
Committee on Regional Trade Agreements  Original: English/Spanish  
 
  FREE TRADE AGREEMENT BETWEEN GUATEMALA AND THE SEPARATE CUSTOMS 
TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU 
(GOODS AND SERVICES) 
QUESTIONS AND REPLIES 
 The following communication, dated 24 June 2013,  is being circulated at the request of the 
delegations of Guatemala and the Separate Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu. 
 
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 This document reproduces the questi ons addressed to the parties and the 
responses submitted. 
Questions from the delegation of Australia 
General comment 
 Tables 4.1 and 4.2 clearly show the significant improvements in the level 
of commitments made by Guatemala and Chinese Taipei  on services compared with both 
countries' GATS commitments. Australia suppo rts ongoing liberalization of services 
trade and the reduction in gaps between co mmitments on services and actual levels 
of market openness, and commends both Guatem ala and Chinese Taipei on their efforts. 
 
1.1.  Paragraph 4.4 and 4.6: Why did the Parties decide to exclude cross-border financial 
services from Chapter 11 (cross-border trade in services)? And also exclude measures 
relating to financial services  from Chapter 10 (investment)? 
 To date, the issue of financial services has not been a priority in the trade relationship 
between the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu and Guatemala. 
The focus is on the exchange of goods and non-fina ncial investment projects. In addition, there is 
no great demand for either Party to provide financial services or to set up a financial presence in the economy of the other. For these reasons, both  Parties agree that financial services between 
them be regulated in accordance with the GATS/WTO, and that no additional arrangements are 
necessary in the bilateral Agreement between them. 
 1.2.  Paragraph 4.11: Australia notes that the Agreement has an article requiring each 
Party to set out any quantitative restrictio ns, and that Guatemala has listed land cargo 
transport services, while Chinese Taipei di d not list any sectors. Why did the parties 
decide not to include a market access prov ision along the lines of GATS Article XVI 
(market access)? 
 Along with the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, 
Guatemala has signed the Maritime Transport Agreement, which contains regulations concerning the maritime operations in Guatemala of the Separate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu's transport companies. Anne x IV of the FTA with the Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu establishes that Guatemala reserves the right to let shipping companies hire the services of several trucking companies in accordance 
with the provisions of Article XVI of the GATS/WTO. Although the wording of Article 11 of WT/REG297/2 
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  the FTA quantitative restrictions may differ from that of GATS Article XVI, it still covers generally 
the same measures as regulated by GATS Article XVI.  1.3.  Paragraph 4.6.1: Australia notes the Agre ement contains a specific Chapter on 
Maritime Services, which is not a chapter ty pically contained in FTAs. Has either Party 
previously included a specific Chapter on  Maritime Services in their other FTAs? 
Could the Parties elaborate on the types of  provisions covered in this chapter? 
Response from the delegation of the Separate Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu  
 
 There are no chapters specifically on Maritime Services in other FTAs of either of the Parties. 
The inclusion of the Maritime Transportation Chapter in this FTA was for the purpose of "Desiring 
to develop further these relations harmoniously, taking into account the freedom of maritime transport and to strengthen, as much as possible, international cooperation in this field;" as stated 
at the very beginning of the Agreement, as well as in the interests of trade and trade facilitation. 
These are general provisions with no details specified.  
Response from the delegation of Guatemala 
 
 Guatemala confirms that in trade agreements it has signed, there are not specific chapters on maritime services, except in the FTA with th e Separate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu, which strengthens relations on maritime transport between the Parties, in 
benefit of trade and trade facilitation.   
Questions from the delegation of Colombia 
1.4.  Section 3.1.2 on page 10 of the orig inal states that: "Table 3.1A. shows 
Guatemala's overall tariff elimination. In 2006 when the Agreement 
entered into force, 48.9% of Guatemala's ta riffs (3,285 tariff lines) were duty free 
on an MFN basis, corresponding to 36.6% of Guatemala's average imports 
from  Chinese Taipei during 2003-2005.1 Upon entry into force of the Agreement, 
an additional 16.0% of tariff lines were liberalized, accounting for 12.4% 
of Guatemala's imports from Chinese Taipei. Further liberalization is due to take place 
between 2006 and 2020. After ten years of implementation, in 2015, Guatemala has committed to liberalize 67.7% of its tariffs, corresponding to 57.6% of its 
imports from Chinese Taipei. At the end of the implementation period, in 2020, 
1,771 tariff lines (26.4% of tariffs) are to remain dutiable, corresponding to 39.2% 
of Guatemala's imports from Chinese Ta ipei in 2003-2005". In this connection, 
Colombia would like to know whether the parties consider that effect is being 
given to Article XXIV of the GATT 1994 in  respect of the substance of trade. 
 The FTA has been in force for six years and according to liberalization schedules, 
over 78% of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu's tariff lines 
and 63% of Guatemala's tariff lines are duty free. In addition, the figures concerning the 
liberalization commitments reflect the results of the negotiations between both parties, taking into consideration each Party's specific interests or concerns. Moreover, as GATT Article XXIV does 
not specify a quantitative benchmark for assessing substantial trade, it is important to note 
that Article XXIV does not specify a term quantitative criterion for substantial trade evaluation. 
1.5.  The FTA entered into force on 1 July 2006 and was notified to the WTO 
on 11 July 2011. It would be much apprecia ted if the Members involved could explain 
the reasons why the notification took so lo ng in the light of Articles XXIV:7(a) 
of the GATT and Article V:7(a) of the GATS (paragraph 2.2). 
 The delay in notifying the FTA to the WTO was due to domestic administrative procedures 
and the discussion between both parties to make a joint notification. 
 
                                               
1 In 2008, Chinese Taipei's tariff consisted of  8,839 tariff lines at the HS 8-digit level. 
Of these 157 lines (1.78%) are subject to non- ad valorem  rates of duty, with 89 lines having 
specific duties and 68 mixed rates of duty. WT/REG297/2 
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  1.6.  We would appreciate further inform ation on how the Agreement applies 
the GATT Article XI criteria in regulating matters relating to quantitative restrictions in preferential trade (paragraph 4.11). 
Response from the delegation of Guatemala 
 Reply relating specifically to the area of trade in goods: Article 3.09 of the FTA provides 
for quantitative restrictions on imports and exports of goods, in accordance with Article XI of the GATT 1994. These have been incorporated into Annex 3.09, which contains a list of the goods 
subject to such measures. 
Response from the delegation of the Separate Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu 
 The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu and Guatemala 
agreed not to adopt or maintain any prohibitions or restrictions on the importation of any goods of 
the other Party or on the exportation or sale for export of any goods destined to the territory of the other Party, except in accordance with Article XI of GATT 1994. 
1.7.  We would be grateful if Guatemala would explain the limitations on the principle 
of national treatment in real estate under this Agreement (paragraph 4.31). 
 Decrees No. 38-71 and No. 48-72, and the amendments thereto found 
in Decree No. 118-96, provide for the programme for the colonization of the Northern Department 
of El Petén as part of the State of Guatemala's constitutional obligation to make available and distribute national land suitable for agricultural colonization and incorporate it into the private property regime through colonization programmes regulated by the legislation (ownership, leasing 
or use of national land), with a view to prov iding peasants and small and medium-sized farmers 
with the necessary means to improve their quality of life and increase domestic production. The legislation and its amendments also provide legal certainty to the beneficiaries of plots of land 
located in the department of El Petén, by ensuring that they receive definitive title deeds 
in the shortest amount of time possible, which in turn increases inhabitants' confidence and furthers the integral development of the department and its full legal incorporation. As a State 
programme, and given that the department of Petén is strategic in terms of economic 
development and national security, being on th e border with one country (Mexico) and with 
another territory in dispute (Belize), it is vital that colonization policies be conducted only by Guatemalans or companies controlled 100% by Guatemalans, which limits national treatment 
in the acquisition of such land. Meeting this fundamental nationality requirement to become 
a beneficiary of the land involves the condition th at they do not own plots of land exceeding 45 ha 
in other departments of the country and do not own established commercial, industrial or mining 
companies, i.e. have no productive assets. Howe ver new companies formed to operate in El Petén 
whose partners meet the above-mentioned requirements may own, lease and use national land in that department. 
1.8.  With regard to trade remedies, in the FTA between Guatemala and Chinese Taipei, 
in addition to the three types of safegu ard applied – global, bilateral and balance 
of payments - the parties also agreed on a special safeguard measure for a list of sensitive products. Can the safeguard me asures be applied simultaneously, or are 
they mutually exclusive? 
 This FTA does not have any provision stipulating whether global and bilateral safeguard 
measures can be applied simultaneously or are mutually exclusive. However, the parties are of the 
view that the three types of Safeguards are mutually exclusive in their application because each 
of them has a different activation mechanism. In other words, each safeguard mechanism has its own purpose and scope. In addition, it is important to mention that none of the safeguard 
mechanisms have been activated. WT/REG297/2 
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  Questions from the delegation of the European Union 
Provisions on Trade in Goods 
Liberalization of trade and tariff lines 
1.9.  According to the factual presentation the de  facto coverage of tariff reductions are 
low: in the case of Chinese Taipei's impo rts from Guatemala, 80.8%  of imports remains 
dutiable, while Guatemala's imports from Chinese Taipei, 39.2% remains dutiable. 
a. Could the Parties provide clarification of  the very low coverage and explain how 
this Agreement fulfils the criteria of covering 'substantial trade'? 
 The FTA has been in force for six years and according to liberalization schedules, 
over 78% of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu's tariff line 
and 63% of Guatemala's tariff line is duty free. In addition, the figures concerning the 
liberalization commitments reflect the results of the negotiations between both parties, taking into 
consideration each Party's specific interests or concerns. Moreover, it is important to note that GATT Article XXIV does not specify a quantitative benchmark for assessing substantial trade. 
b. Could the Parties clarify what steps have be en already taken, if any, to increase 
the coverage of the Agreement and/or if  they envisage any plan to decrease 
the proportion of the dutiable trade under the FTA? 
Response from the delegation of Guatemala 
 So far the Parties have come together to agree on mechanisms to follow in fulfilling these 
commitments; it is expected that the technical committees and commission administrator can meet in a short time. 
Response from the delegation of the Separate Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu 
 We are considering holding a meeting of the FTA Free Trade Commission in due course 
and will take this issue into account. 
General provisions of the Agreement 
Intellectual Property Rights 
1.10.  Article 15.02 Protection of Ge ographical Indications of the 
Chinese Taipei-Guatemala FTA foresees that within two years the Parties will initiate 
consultation on protection and/or reco gnition of the geographical indications 
of both parties. 
a. Could the Parties provide further informat ion if indeed such consultations are 
in progress or concluded and if so with what results? 
b. Could the Parties clarify what is the ti meline for notifying each other of the 
protected geographical indications? 
 No consultation has been initiated. Both Parties will work together on the relevant 
arrangement where necessary. 
Regulatory provisions on trade in goods 
Standards 
Sanitary and phytosanitary measures 
1.11.  Chapter 8 on Sanitary and Phytosanitary Measures of the 
Chinese Taipei-Guatemala FTA reconfirms th e Parties' commitment to use international 
standards, guidelines such as OIE, CODEX, IPPC and adopt SPS measures on scientific 
basis. Article 8.08 on Recognition of Pest- or  Disease-Free Areas an d Areas of Low Pest 
or Disease Prevalence of the Chinese Taipei-G uatemala FTA provides that the Parties will WT/REG297/2 
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  recognize the pest- or disease-free area s and the areas of low pest or disease 
prevalence according to international stan dards, guidelines or recommendations, 
taking into account geographical situatio n, ecosystems, epidemiological surveillance 
and the effectiveness of sanitary and phytosanitary controls in the area. 
a. Could Chinese Taipei confirm that it a pplies specific additional procedures 
for recognition of disease-free st atus for Guatemala under the FTA?  
 We apply the same procedures to every trading partner as far as the recognition 
of disease-free status is concerned. 
b. Could Chinese Taipei provide an expl anation why it does not follow OIE 
guidelines on recognition of disease-fr ee status and maintains an additional 
procedure for areas listed by OIE as free? 
 According to Article 6 of the SPS Agreement rela ting to the adaptation of regional conditions, 
exporting members shall provide the necessary  evidence in order to objectively demonstrate 
to the importing member their disease-free status. Furthermore, the OIE only grants official 
recognition for foot and mouth disease (FMD), bovine spongiform encephalopathy (BSE) 
and contagious bovine pleuropneumonia (CBPP). If the exporting member has been recognized 
by the OIE as disease free of the above-mentioned diseases, we will take it into account 
and expedite the procedures. 
Relationship with other agreements concluded by the parties 
Table 5.1 
1.12.  According to the information contained in  table 5.1, three agreements have not 
yet been notified to the WTO: 
 the Cross-Strait ECFA entered in to force on 1 January 2011; 
 Panama (Panama-Central America) entered into force in 2009; 
 Cuba (LAIA) RTA entered into force in 2001. 
a. Could the relevant Party (either Guat emala or Chinese Taipei, depending 
on the Agreement) clarify why the above mentioned agreements have not been 
formally notified? 
Response from the delegation of Guatemala 
 The Panama (Panama-Central America) notification has been made. The WTO Secretariat 
has published it under document number WT/REG336/N/1/Rev.1-S/C/N/692/Rev.1 
on 26 April 2013. 
Response from the delegation of the Separate Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu 
 We submitted to the Secretariat in May 2011 an early announcement on the Cross-Strait 
ECFA with its text and annexes, which has already been included in the RTA database. 
Since the ECFA is only a framework agreement, with follow-up agreements to be negotiated, 
we shall formally notify the WTO of the ECFA an d its follow-up agreements after those agreements 
are signed. 
b. Do they envisage to notify  them in the near future? 
 With respect to the Cuba (LAIA) RTA with Guatemala, a bilateral meeting of the Commission 
of both parties is pending in order to coordinate the terms of said notification before the WTO. WT/REG297/2 
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  c. With reference to the Cuba agreement, signed under the umbrella of LAIA, 
could Guatemala submit the list of addi tional concessions granted bilaterally 
on goods? 
 Guatemala believes that the information on th e Cuba agreement requested in this question 
is irrelevant and unrelated to the Free Trade Agreement with Chinese Taipei that is currently under 
consideration. However, in order to answer the question, the list of additional concessions regarding the Cuba agreement can be accessed using the following web link: 
http://portaldace.mineco.gob.gt . 
 
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