WORLD TRADE  
ORGANIZATION  RESTRICTED 
G/C/M/111 
3 October 2012 
 (12-5356) 
Council for Trade in Goods  
 
 
MINUTES OF THE MEETING OF THE COUNCIL FOR TRADE IN GOODS  
22 JUNE 2012 
 
Chairperson: H.E. Ambassador Tom MBOYA OKEYO (Kenya) 
   The meeting of the Council for Trade in Goods was convened by airgram WTO/AIR/3955 
and the proposed agenda for the meeting was c ontained in document G/C/W/671.  The meeting 
proceeded on the basis of the following agenda.  
I.  NOTIFICATION OF REGIONAL TRADE AGREEMENTS ............................................. 2  
II.  COMMITTEE ON MARKET ACCESS ISSUES ................................................................. 2  
III. FREQUENCY OF NOTIFICATIONS OF  STATE TRADING ENTERPRISES 
UNDER ARTICLE XVII OF GATT 1994 AND THE UNDERSTANDING ON 
THE INTERPRETATION OF ARTIC LE XVII OF GATT 1994 (G/STR/8) ..................... 3  
IV.  FACTUAL REPORT BY THE CHAIRMAN OF THE SAFEGUARDS 
COMMITTEE REGARDING ARTICLE 13. 1.(B) OF THE AGREEMENT ON 
SAFEGUARDS (G/SG/100) ..................................................................................................... 4  
V.  NOTIFICATIONS OF ACTIONS TA KEN UNDER THE 1999 WAIVER FOR 
PREFERENTIAL TARIFF TREATMENT FOR LEAST-DEVELOPPED COUNTRIES (WT/L/304) ........................................................................................................ 6  
VI.  PHILIPPINES - REQUEST FOR A WAIV ER RELATING TO THE SPECIAL 
TREATMENT FOR RICE OF THE PHILIPPINES (G/C/W/665) ..................................... 7  
VII. EUROPEAN UNION - RESTRICTIVE MEASURE ON BIODIESEL 
IMPORTS (MINISTERIAL ORDER I ET/822/2012, KINGDOM OF SPAIN) - 
REQUEST BY ARGENTINA ................................................................................................. 8  
VIII. RULING OF THE EUROPEAN COURT OF JUSTICE OF 6 SEPTEMBER 
2011 (CASE C-422/09) ISSUED IN TH E FRAMEWORK OF PROCEEDINGS 
FOR THE INTERPRETATION OF COMMUNITY LAWS FOLLOWING 
THE DETECTION IN HONEY OF POLLEN CONTAINING GENETICALLY 
MODIFIED MAIZE MON 810 - RE QUEST BY ARGENTINA ....................................... 10  
IX.  ARGENTINA'S IMPORT RESTRICTING POLICIES AND PRACTICES - 
REQUEST BY JAPAN AND THE UNITED STATES ........................................................ 12  
X.  INDONESIA'S IMPORT RESTRICTING POLICIES AND PRACTICES - 
REQUEST BY THE EUROPEAN UNION, JAPAN AND THE UNITED STATES. ....................................................................................................................... ........... 15  
XI.  ECUADOR MIXED TARIFFS - REQUES T BY THE EUROPEAN UNION, 
JAPAN, AND THE UNITED STATES................................................................................. 20  
XII. WORK PROGRAMME ON ELE CTRONIC COMMERCE ............................................. 23  
XIII. OTHER BUSINESS ................................................................................................................  24 G/C/M/111 
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   When adopting the Agenda, the delegate of Arge ntina referred to a pr ocedural issue relating 
to item IX of the Agenda "Argentina's Import Rest ricting Policies and Practic es" which was included, 
upon request, by Japan and the United States.   The matter was first raised in the Goods Council on 30 
November 2010and was thereafter included on all the ag endas of the 2011 meetings with the last one  
at the meeting of 30 March 2012.   Thus, it would be the sixth occasion that the CTG was examining 
this issue.  In her view, this indicated that some delegations seemed to be trying to include it as a 
permanent item on the CTG's agenda.  Her delegation considered that this was counter to the spirit 
and the letter of the Rules of Procedure that underpin  the work of the Council, particularly Rule 27 of 
the Rules of the General Council contained in doc ument W/T/L/61 which were applicable to the 
sessions of the Goods Council and which stated that representatives should make every effort to avoid 
the repetition of a full debate at each meeting on an i ssue that had already been debated in the past and 
on which there appeared to have been no change  on record in the positions of the Members.. 
 
  She indicated that at the five previous  meetings of the CTG, Members had had the 
opportunity to express their points of view and her delegation had given its replies and clarified its 
position, even with the presence of high official s from her capital who attended the meeting on 30 
March 2012.  Therefore, it was clear that the issue had been discussed in detail and that to continue 
including this item on the agenda was merely political.  She requested that her statement be reflected 
in the minutes and asked those Members who had requ ested the inclusion of this item on the agenda 
to comply with the Rules of Procedure.  
 The delegate from Ecuador reite rated the importance of Rule 27 of the Rules of Procedure as 
stressed by the Argentinian delegate and indicated  that under "Other Business", his delegation would 
inform the Council on different changes which had been introduced to Ecuador's import tariffs.   
 
 The delegate of Indonesia indicated that hi s delegation would support the statement to be 
made by Argentina under Agenda item VII.  
 
I. NOTIFICATION OF REGIONAL TRADE AGREEMENTS 
1. The Chairman recalled that, under the worki ng procedures agreed by the Committee on 
Regional Trade Agreements (CRTA) and follo wing adoption by the General Council of the 
Transparency Mechanism, the Counc il for Trade in Goods was to be kept informed of Members' 
notifications of new regional trade agreements.  He informed the CTG that the following regional 
trade agreements had been notified to the RTA Committee: 
 (A) FREE TRADE AGREEMENT BETWEEN CHILE AND GUATEMALA 
(CENTRAL AMERICA) (WT/REG312/N/1) 
 
 (B) FREE TRADE AGREEMENT BETWEEN PERU AND PANAMA 
(WT/REG313/N/1/REV/1) 
  (C) FREE TRADE AGREEMENT BETWEEN THE UNITED STATES AND 
COLOMBIA (WT/REG314/N/1) 
 
 The Council took note of the information presented. 
 
II. COMMITTEE ON MARKET ACCESS ISSUES 
2.1 The Chairperson noted that the Market Access Committee had forwarded two items for 
consideration by  the Council for Trade in Goods.  
  G/C/M/111 
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  A. COMMITTEE ON MARKET ACCESS – PERIODIC REPORT OF THE COMMITTEE TO THE COUNCIL 
FOR TRADE IN GOODS (G/MA/284) 
2.2 The Chairperson drew Members' attention to  the periodic report of the Committee on Market 
Access contained in document G/MA/284.  The repor t was factual in nature, and reflected the work 
undertaken in the Market Access Committee.   
 
2.3 The Council took note of the periodic report.   
 
B. DRAFT DECISION ON NOTIFICATION PROCEDURES FOR QUANTITATIVE RESTRICTIONS 
(G/MA/W/110)   
2.4 The Chairperson drew Members' attention to  the "Draft Decision on Notification Procedures 
for Quantitative Restrictions" (G/MA/W/110) and recalled that the current "Decision on Notification 
Procedures for Quantitative Restrictions", contained in document G/L/59, was adopted by this 
Council on 1 December 1995.  The Committee on Ma rket Access had been discussing this Decision 
since 2009 in the context of an exercise to improve  the timeliness and completeness of notifications 
and other information flows and that at its  formal meeting on 19 March 2012, the Committee 
approved the draft Decision contained in documen t G/MA/W/110.   This draft Decision, which 
would replace the current Decision, had been fo rwarded by that Committee to the CTG for its 
adoption.  He proposed that the Council adopt the draft decision contained in G/MA/W/110.  
 2.5 The Council adopted the draft Decision on Notification Procedures for Quantitative 
Restrictions contained in document G/MA/W/110.1  
 
III. FREQUENCY OF NOTIFICATIONS OF STATE TRADING ENTERPRISES UNDER 
ARTICLE XVII OF GATT 1994 AND THE UNDERSTANDING ON THE 
INTERPRETATION OF ARTICLE XVII OF GATT 1994 (G/STR/8) 
3.1 The Chairperson drew Members' attention to the recommendation adopted by the Working 
Party on State Trading Enterprises on 8 June 2012, cont ained in document G/STR/8, for the indefinite 
extension of the current frequency of notifications, a nd, on behalf of the Chairperson of the Working 
Party, read the following statement:  
"By way of background, on 11 November 2003 the Working Party on State Trading 
Enterprises adopted a recommendation containe d in G/STR/5 regarding the frequency of 
notifications.  This recommendation modified the frequency of state trading notifications to 
new and full notifications every two years rather th an every three years.  It also eliminated the 
need for updating notifications in the interveni ng years.  This was an effort to reduce the 
notification burden on Members and therefore help Members improve compliance with their 
notification obligations in the Working Party.  The recommendation took effect from 2004 and was implemented for an initial four-year tria l period, until 30 June 2008.  This frequency 
was extended by the Working Party in 2008 (document G/STR/6) and again in 2010 
(document G/STR/7) until 30 June 2012. 
Following informal consultations, Members indicat ed that they could agree on an indefinite 
extension of the current frequency.  At its fo rmal meeting on 8 June 2012, the Working Party 
adopted the recommendation in G/STR/8 to exte nd the current, less burdensome frequency of 
notifications on an indefinite basis. 
Thereby, the Working Party recommends to the Goods Council that:  
                                                      
1 Circulated as G/L/59/Rev.1 G/C/M/111 
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  (a) This indefinite extension shall enter into force as of the year 2012, with the next new 
and full notification being due by 30 June 2014; and 
The guidelines for completing the Questionnaire on State Trading Enterprises are those 
contained in G/STR/3/Rev.1." 
3.2 The Chairperson invited the Council to ta ke note of the Working Party Chairperson's 
statement and approve the recommendation on the fre quency of notifications contained in document 
G/STR/8. 
3.3 The Council so agreed. 
IV. FACTUAL REPORT BY THE CHAIRMAN OF THE SAFEGUARDS COMMITTEE 
REGARDING ARTICLE 13.1.(B) OF THE AGREEMENT ON SAFEGUARDS 
(G/SG/100)  
4.1 The Chairperson informed Me mbers that the Council was to consider a factual report by the 
Chairperson of the Committee on Sa feguards regarding Article 13.1(B)  of the Agreement on Safeguards 
and contained in document G/SG/100.  This f actual report, submitted under the Chair's own 
responsibility, was discus sed informally by the Committee on Safeguards on 16 April 2012 when the 
Chair announced to delegations that she would send it to the Goods Council.  The Chair of the 
Committee formally informed the Committee at th e regular meeting held on 27 April 2012 that the 
factual report had been circulated. 
4.2 The delegate of Colombia thanked the Chai rman of the Safeguards Committee for the work 
done to take on board Colombia's request to ensure that the procedural requirements in the Safeguards 
Agreement had been applied on the safeguards me asures taken by Ecuador on wind shields.  
However, Colombia considered that the factual repor t did not fully respond to its request of ensuring 
that Ecuador had complied with the procedural re quirements. It only reflected the position of the 
parties despite the fact that, throughout the pr ocess, sufficient evidence was given which made it 
possible to establish that Ecuador violated the pr ocedures established in Article 12 of the Agreement 
on Safeguards by imposing the safeguard  measure without holding prior consultations.  She stated that 
Ecuador applied the measure on 23 September 2010 and it came into force on 11 October 2010; 
consultations were only held on 25 October; this violated the procedures established in Article 12.  
The report did not include the conclusions drawn du ring the consultations with Members such as the 
importance that the notifications reflect the le gal measures which were brought into force.   
 4.3 The negative precedent that a notification modi fies the implementation of a measure, nor that 
contrary information be given so as to cover the fl aws in the adoption of such measure should not be 
established at the WTO.  Colombia also noted that despite the fact that the documents which Ecuador 
appended to its request indicated that the measu re came into force on 11  October 2010, Ecuador 
changed the date in its notification to 11 November  2010.  Her delegation believed that that this type 
of conduct depleted the principles of the WTO and should be refused.  The report did not mention Ecuador's acknowledgement at the informal consultations held on 16 April 2012 that its customs 
officials had indeed been levying safeguard duti es as of 11 October 2010, prior to consultations. 
During these consultations Colombia had provided evidence in this regard.  
 
4.4 She also stated that mo st Members who spoke during th e informal consultations on 3 
February 2012 indicated that it was evident fro m the documents presented by Colombia that the 
measure came into effect before the consulta tion process and this was against the Safeguards 
Agreement.   Colombia had raised for the first time  in the history of the Safeguards Committee, the 
use of this mechanism as it considered it important  in the surveillance activity of the whole WTO 
membership so as to ensure full co mpliance with the rules establishe d in the Safeguards Agreement.   G/C/M/111 
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  Colombia believed that the scope of this mech anism established under Article 13.1(b) had been 
disregarded since the Ecuadorian measure remained in force and was damaging Colombia's industry. 
 4.5 The delegate of Ecuador stated that the re quest filed by Colombia in 2011 on the supposed 
violation by Ecuador of Article 12 of the Safe guards Agreement was to allow the Safeguards 
Committee to examine it under Article 13.1(b) of the Agreement.  Under this Article it is up to the 
Safeguards Committee to decide whet her the procedural requirements had been complied with.  It was 
quite clear that there was no other way of carryi ng out such surveillance but through the establishment 
of the facts as well as an objective and impartial assessment.  In Ecuador's view, the establishment of 
the facts and their assessment could be carried out in an appropriate way within the framework of a 
general application procedure.  Ecuador maintained that to comply with Article 13 1(b) the 
Committee should have adopted as a sine qua non  condition the procedures according to which such a 
request could be examined.  His delegation, jointly  with Cuba and Turkey, drew up a proposal on the 
matter, circulated in document G/SG/W/222, which id entified the particular features of the safeguard 
measures; established the framework in which Article 13 of the Safeguards Agreement was 
negotiated; mentioned the objectives of the Agreement; and, particularly, the role of the "exclusive 
jurisdiction clause" contained in Article 23.1 of the Dispute Settlement Understanding (DSU).  Since 
the Safeguards Agreement did not contain a criteria to  distinguish between subs tantive and procedural 
requirements, based on the opinion of specialists on rulings of some panel reports as well as on panels 
of the Appellate Body, the text contained a list of  procedural obligations.  Ecuador also drew up a 
procedural proposal according to which the Safeguards Committee could consider in a timely and 
expeditious way, the requests tabled under Article 13.1(b). 
4.6 Under Article 13.1(b) the Committee had to "ens ure" that the procedural requirements of the 
Agreement had been complied with; however, this was li mited to a strictly factual review.  Article 14 
of the Safeguards Agreement, the DSU and its exclus ive jurisdiction clause as well as the rulings of 
the Appellate Body in cases DS90 and DS34 re-confir med this scope unequivocally.  Contrary action 
would have led to usurpation of the competence granted to the WTO decision making bodies which, 
according to Article 3 2 of the DSU, were empowered to clarify the provisions of the covered Agreement and preserve the rights and obligations of  Members. His delegation highlighted the way in 
which the Chair of the Safeguards Committee fairly  dealt with this matter with the professional 
support of the experts in the Rules Division.  Sufficien t time was  given so that  the interested parties 
could carry out the necessary consultations; the process was limited to a very clear scope and all this 
was expressed in a factual report as was supposed to  be the case.  The "mere expectations" and the 
accumulation of statements made should, as was th e case, be considered objectively and the outcome 
was strictly factual.  The efficiency of a sy stem cannot be assessed according to an unconditional 
acceptance of "mere expectations" of the parties to a process.   
4.7 He quoted what Ecuador said in informal cons ultations and during the last formal meeting of 
the Safeguards Committee: "We have the docum ent evidence according to which the customs 
authorities levied between the 11 and 31 October, merely the regular duties.  However during this 
period some inconsistent actions were register ed for instance a transaction which took place on 19 
October".  His delegation also indicated that accordi ng to the Ecuadorian legislation, for undue levies 
by the customs administration there was an expediti ous procedure for claiming, administratively and 
judicially, the undue levy and payment of a customs duty.  Through this procedure, the affected 
Colombian company could seek compensation for undue application of this measure.  Ecuador 
deplored any assertions made out of context which were not exact.   
4.8 As to the substance, he indicated that Ecua dor had strictly complied with the procedural 
requirements established in the Agreement:  in Resolu tion 587 published in the Official Gazette of 11 
October 2010, a decision was adopted to apply a safeguard measure; on 15 October the WTO was 
notified of Resolution 587 and on 25 October consu ltations were held with Colombia; and, on 1 
November 2010, the safeguard measure adopted in Resolution 587was implemented.  On this point, G/C/M/111 
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  Ecuador regretted that there were still basic mis understandings: according to Article 12.1(c) of the 
Safeguards Agreement all Members would immedi ately notify to the Safeguards Committee the 
adoption of a decision to apply or withstand any saf eguards measure and, according to the Appellate 
Body ruling in Paragraph 120 of the US - Wheat Gl uten "to adopt a decision" was not tantamount to 
"implementing a decision".  
4.9 The Chairperson invited the Council to ta ke note of the factual report made by the 
Chairperson of the Committee on Safeguards in doc ument G/SG/100 and of the statements made. 
4.10 The Council so agreed.  
V. NOTIFICATIONS OF ACTIONS TAKEN UNDER THE 1999 WAIVER FOR 
PREFERENTIAL TARIFF TREATMENT FOR LEAST-DEVELOPPED COUNTRIES 
(WT/L/304)  
5.1 The Chairperson announced that there was a notification from Korea in document G/C/W/670 
on Preferential Treatment for LDCs.  This notifica tion had also been made to the Committee on Trade 
and Development (CTD), under the provisions in th e Transparency Mechanism for Preferential Trade 
Arrangements as contained in document WT/COM TD/N/12/Rev.1/Add.1 da ted 20 March 2012.  He 
recalled that this Council, at its meeting in March 20012, agreed to a method for handling notifications 
under the 1999 Waiver on Preferential Tariff Treatment  for LDCs.  Accordingly, such notifications 
shall be referred by the CTG to the Sub-Co mmittee on Least-developed countries for Members' 
consideration and advice.  The Sub-Committee would then report back to the CTG on its discussions.  
It was clear that this approach did not preclude the CTG from engaging in discussions of any matter in regard to the 1999 waiver.  However, he had been  informed by the Secret ariat that the Korean 
notification was on the agenda of the 84
th Regular Session of the Committee on Trade and 
Development (CTD), held on 11 April 2012, where Me mbers agreed to forward that notification for 
its substantive consideration by the Sub-Committee on  LDCs.  Accordingly, the Sub-Committee, at its 
65th Session held on 16 April 2012, had undertaken a subs tantive consideration of this notification, 
following an introduction by the Korean delegation. 
5.2 The representative of Korea took the opportunity  to share key elements of Korea's scheme for 
non-reciprocal preferential treatment for LDCs; Korea had been providing duty-free-quota-free 
market access for the products of interest to LD Cs since January 2000 and, as part of its good faith 
efforts to implement the 2005 Hong Kong Minister ial commitments, it decided to expand duty free 
quota free (DFQF) market access coverage to 95 per cent by 2012. On 25 November 2011, the Korean government modified the relevant Pr esidential Decree and extended its preferential tariff treatments to 
products originating from all 48 UN-defined LDCs whic h covered 4,802 tariff lines at 6-digit level of 
the HS 2007 nomenclature and which represented 95 per cent of its total tariff lines.  This modification entered into force on 1 January 2012.  Further to this expansion, the Korean government 
lowered the threshold for LDC origin in terms of va lue to 40 per cent from the previous level of 50 
per cent.  Korea believed that this enhanced ma rket access opportunity for LDCs would contribute to 
facilitating their integration into the world trading system as well as to the provision of predictable 
and favourable market access conditions for their pr oducts.  Korea considered  this mechanism as one 
of the most effective tools to contribute to  the economic growth an d development of LDCs. 
5.3 The delegate of the European Union welcom ed Korea's information concerning DFQF access 
to 95 per cent of its total tariff lines to LDCs.  This matched the 2005 Hong Kong Declaration which 
committed developed-country Members and devel oping-country Members declaring themselves in a 
position to do so, "to provide DFQF access to 97% of  products originating in LDCs".  However, the 
EU encouraged Korea to move further in this di rection and provide duty free quota free access to all 
                                                      
2 See document G/C/M/47  G/C/M/111 
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  LDC products – except arms – as the EU did.  The EU also called on other Members that had not yet 
done so to also move in this direction. 
5.4 He also highlighted the other half of Korea's commitment, which was to "ensure that 
preferential rules of origin applicable to imports from LDCs are transparent, simple and contribute to 
facilitating market access".   Since 1 January 2011 th e EU, in the framework of its General System of 
Preferences, had implemented new and simpler preferential rules of origin which were easier to 
comply with, and offered extended possibilities of cumu lation.  In this regard  he encouraged other 
Members that had not yet done so, to ta ke ambitious steps in this direction. 
 
5.5 The Chairperson invited the Council to take note of the Korean notification in document 
G/C/W/670 and the statements made.  
 
5.6 The Council so agreed.  
 
VI. PHILIPPINES - REQUEST FOR A WAIVER RELATING TO THE SPECIAL 
TREATMENT FOR RICE OF THE PHILIPPINES (G/C/W/665)  
6.1 The Chairperson recalled that at the me eting on 30 March 2012, the Philippines introduced 
document G/C/W/665, containing a request for a waiver relating to special treatment for rice from the 
Philippines.  At that meeting, the delegations who took the floor recalled that there were on-going 
consultations on this issue in the Committee on Agri culture; reiterated their interest in continuing 
discussing with the Philippines and in obtaining further clarification on the waiver request. 
6.2 The delegate of the Philippines when reporting on the status of the negotiations on the  
request for a waiver, reiterated the importance fo r the Philippines to continue with the special 
treatment for rice in view of adverse circumstances,  mainly natural extreme events in the past few 
years that had stalled the sector's resiliency pr ogram and capacity to sustain national food and 
livelihood security objectives.  The resiliency progr am was now being put back in place with the 
appropriate improvements to deal with climate change impacts, technological improvements to 
increase productivity, competitiveness and diversifi cation. He recalled that at the 30 March 2012 
meeting, many Members expressed general support  for the waiver initiative and indicated their 
interest to enter into negotiations with the Philippin es. He also recalled that prior to filing the waiver, 
the Philippines launched negotiations  at the November 2011 meeting of the Committee on Agriculture 
to continue the special treatment for rice under A nnex 5 of the Agreement on Agriculture .  However, 
the Philippines deemed it necessary to invoke the wa iver provisions of the WTO Agreement in view 
of the impending expiry of the special treatment and to avoid a protracted legal debate on whether Annex 5 allowed for further continuation of the speci al treatment, a major stumbling block for some 
Members to engage substantively and meaningf ully in the negotiations in the Committee on 
Agriculture. 
6.3 Since the March meeting, the Philippines ha d intensified consultations with interested 
Members in Geneva and in capitals.  However the c onsultations were not finished in time for this 
Council meeting.  Nevertheless, the Philippines re mained encouraged by the good progress that had 
been achieved as well as the positive indication from Members of their willingness for continued full 
engagement and co-operation in these negotiations, there still were opportunities for consensus in the 
very near future.  Consultations  would continue both in Geneva and in capitals thus, he called on 
Members to remain fully engaged in negotiations so that agreement towards consensus could be 
reached as expeditiously as possible.  
6.4 The delegate of the United States stated th at there were a number of concerns with the 
Philippines' waiver request as currently drafte d and that her delegation had provided written 
comments to the Philippines that accounted for th ese concerns.  Since the Philippines intended to G/C/M/111 
Page 8 
 
 
  continue consulting with Members on the specific wa iver language, her delegation looked forward to 
working together with other Members to resolve outstanding issues. 
 6.5 The delegate of Canada thanked the Philippi nes for the update and informed Members that 
her authorities were currently in the process of cons ulting with the Philippines on this issue and would 
continue to work very closely on this issue. Ca nada was confident that a solution would be found 
soon. 
 6.6 The delegate of Australia stated that her delegation was fully committed to work with the 
Philippines towards a consensus out come on the draft waiver and in doing so, Canada urged the 
Philippines to work expeditiously to conclude the consultations with other Members given that the 
deadline for the current special treatment was drawing close. 
 
6.7 The delegate of Thailand welcomed the pr esence of a delegation from Manila as well as the 
progress report on the way forward with regard to th e waiver request.  Thailand continued to support 
the Philippines' work and steps in pursuing the rice waiver and noted the need  to obtain the waiver 
before its expiry on 30 June 2012.  However, Th ailand had concerns about the draft waiver as 
submitted by the Philippines and the effects it might  cause.  Therefore, and without prejudging the 
outcome of the negotiations, Thailand could agree on the waiver at this juncture provided that its 
duration would only be as long as necessary for the ne gotiations to be completed; these details would 
be further consulted with the Philippines. 
 
6.8 The delegate of the Philippines thanked th e previous speakers for their engagement and 
commitment towards a positive conclusion on this particular issue. 
 
6.9 The Chairperson thanked delegations for stat ements made and recalled that the Council had 
been considering this waiver request since 30 Ma rch 2012.  Therefore, on 28 June 2012 the Council 
would have been considering it for over 90 days  and, in accordance with Article IX.3(b) of the 
Marrakesh Agreement, it was required to submit a repor t to the Ministerial Conference or, in this case, 
the General Council.  Since the next meeting of the General Council was scheduled to take place on 
25 July 2012 he would, in his capacity as Chair of the Council, provide a brief and factual report to 
the General Council indicating that the CTG would n eed further time to consider the request and 
would report back to the General Council once it its wo rk had been completed.  He proposed that the 
Council take note of the statements made and re vert to this matter at its next meeting. 
 
6.10 The Council so agreed.    
  
VII. EUROPEAN UNION - RESTRICTIVE MEASURE ON BIODIESEL IMPORTS 
(MINISTERIAL ORDER IET/822/2012, KINGDOM OF SPAIN) - REQUEST BY 
ARGENTINA  
7.1 The Chairman informed the Council that in a communication dated 11 June 2012,  Argentina 
requested inclusion of this item on the agenda of to day's meeting; this had been raised at the TBT 
Committee meeting on 13 - 15 June 2012 and it referre d to measures establishing a system for the 
allocation of biodiesel production volumes for the purpose of computing compliance with mandatory 
biofuel consumption targets.  
  
7.2 The delegate of Argentina recalled that at the beginning of the meeting, the delegation of 
Indonesia had requested to be included in the statemen t to be made by her delegation; thus, she would 
make a joint statement by Argentina and Indo nesia.  She expressed joint concern over the 
Government of Spain's Ministerial Order IET/822/ 2012 that entered into force on 22 April 2012 and 
which, ipso facto,  prohibited imports of extra-EU biodiesel. .  The order provides that computing for 
mandatory biofuel targets may only be conducted in relation to biodiesel produced entirely in plants  G/C/M/111 
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  located on the territory of Spain or of another EU Member State, and in line with previously allocated 
volumes, in accordance with the procedure established in the same Ministerial Order.  In Argentina 
and Indonesia's view this was prima facie  in clear violation of the obligation regarding national 
treatment incorporated into GATT since it did not a llow proprietors of manufacturing plants situated 
outside the EU or Spanish national borders to appl y for the allocation of biodiesel production volumes 
within the framework of the procedure set forth by  such norm.  The said Order nullified the benefits 
resulting from GATT 1994 by forbidding the use of bi odiesel not produced in the EU.  Thus, this 
measure protected the EU production and unjustif iably discriminated against imports causing 
distortion in the production and international trade of biodiesel.  
7.3 Argentina and Indonesia considered that the regulation violated Articles III and XI.1 of 
GATT 1994 and was not consistent with Articles 2, 5 and 12 of the Agreement on Technical Barriers 
to Trade (TBT), whilst it also nullified and impaired  benefits of tariff concessions accruing to other 
Members under Article II of GATT 1994 in the sen se of paragraph 1(b) of Article XXIII of GATT 
1994.  They regretted that the measure had been taken with a  supposed e nvironmental goal though 
without  scientific justification.  Additionall y, these types of measures notoriously deterred 
developing countries like Argentina and Indonesia from improving positions in the global value chain 
of production effectively limiting their participation in  the first stage of the chain as providers of raw 
materials.  This measure imposed severe obstacles  to industrialisation in developing countries that 
exported biodiesel as a final product.  They urged the EU to take immediate actions to respond to 
these concerns and bring Ministerial Order IET/ 822/2012 into conformity with its multilateral 
obligations.  Argentina and Indonesia reserved their rights to subsequently proceed with this issue. 
 
7.4 The delegate of Uruguay thanked Argentina for the joint statement and indicated that without 
prejudice to Uruguay's interest in hearing the expl anations and response from the EU, he shared the 
concern raised that the measure was prima facie  inconsistent with the WTO rules.  Pursuant to the 
DSB interpretation, this measure was a technical re gulation and it provided less favourable treatment 
to third countries producers as compared to the Spanish and intra-communitarian producers.  His 
delegation had two main concerns: firstly the risk  of  a spiral of action and counter-action and 
secondly, a temptation in the EU and its member States,  or some of them, to use a legitimate objective 
as a pretext to impose unjustified barriers to trade.  Thus, Uruguay had raised in the CTG and other 
fora, its systemic and trade concerns at this worrying trend which, like in the case of honey, 
represented the virtual loss of its main export mark et and had affected 12,000 small family producers 
because of an illogical and alleged possibility that  bees had been fed with genetically modified 
products.  There was also a long list of actions such  as labelling of organic products, wines, Grenelle 
II, REACH and other private standards that were affecting and threatening trade under the excuse of 
the importance to facilitate trade.  Uruguay calle d upon those Members applying such measures to 
assume their responsibility by using standards in the wa y they required others to use their standards. 
 
7.5 The delegate of Cuba indicated that as in othe r fora, her delegation shared the concerns raised 
by Argentina and Indonesia related to the prolifera tion, in developed markets, of such measures which 
were discriminatory in nature and affected deve loping countries without any scientific basis, thus 
violating the main principles of the multilateral trad ing system.  Their main objective was to protect 
national products under the pretext of protecting the environment.  She asked the EU to explain the 
basis and rationale of such rulings  and regulations and indicate whethe r or not it took into account the 
impact on trade of developing countries.  
7.6 The delegate of Indonesia, co-sponsor of the statement read by Argentina, indicated that as a 
country with a significant volume of biodiesel exports  to Spain, Indonesia had serious concerns on the 
policy adopted on imports of biodiesel.  This was not in line with the EU statements in various fora 
regarding the need for all Members to follow the WTO rules.  This policy would have detrimental 
effects to Members especially for biodiesel expor ts and trade between de veloped and developing G/C/M/111 
Page 10 
 
 
  countries, including Indonesia.  He urged the EU and in particular, the Spanish authorities, to 
seriously consider these concerns and bri ng the measures in line with WTO rules. 
 7.7 The delegate of Brazil indicated that any measu re that potentially restricted trade in biofuels 
was also of concern to Brazil.  His delegation was of the view that the impacts of the Ministerial 
Order IET/822/2012 deserved to be examined in greater detail. 
 
7.8 The delegate of the European Union indicated  that his delegation was aware of Argentina's 
interests in the development of the EU policy for the promotion of biofuels, which had helped to 
create significant demand and mark et opportunities. The EU had e ngaged with partners in a 
transparent manner and had discussed this matter with Argentina on previous occasions.  Targets 
adopted for the use of biofuels in road transport fuels was a key component of the EU's response to 
achieving climate and environmental objectives, in pa rticular its Kyoto targets of Green House Gas 
emissions. The Renewable Energy Directive (RED) and the Fuel Quality Di rective (FQD) enhanced 
the demand for biofuels and agricultural feedstock used  for the production of biofuels, and, as a result, 
created new market opportunities under appropriate and strict sustainability criteria applicable to both 
EU and foreign suppliers, in orde r to meet environmental objecti ves. Given the rising demand for 
biofuels, this was resulting in the development of both EU domestic produc tion and enhanced import 
opportunities for biofuels and their components from other WTO Members. 
 7.9 The EU's RED and FQD were implemented by EU member States. The Spanish Ministerial 
Order of 20 April 2012 laid down technical rules concerning biodiesel production to fulfil national 
targets on use of renewable energy in the transpor t sector. This should be seen in the context of the 
RED, whose objective was the protection of the environment by increasing the use of renewable 
energies complying with defined targets at the nationa l level, and to contribute to the security of 
supply of energy and energy products.  The Span ish Order was in line w ith the RED objectives and 
did not prevent the import of biodiesel from Argentina or any other trading partner.  Furthermore, the 
EU would consider the efforts made by other countri es to increase the share of  renewable energy use, 
including through market regulations conducive to that objective. Thus, the EU stood ready to also 
discuss Argentina's own experience in the implementa tion of blending rules, tax advantages and other 
incentives from which companies establi shed in Argentina benefited.  
 
7.10 The delegate of Argentina stated that her de legation was ready to be included in the bilateral 
discussions taking place with some WTO Members on the Spanish law. 
 
7.11 The Chairperson invited the Council to take note of the statements made and the Council so 
agreed.  
 
VIII.  RULING OF THE EUROPEAN COURT OF JUSTICE OF 6 SEPTEMBER 2011 
(CASE C-422/09) ISSUED IN THE F RAMEWORK OF PROCEEDINGS FOR THE 
INTERPRETATION OF COMMUNITY LA WS FOLLOWING THE DETECTION IN 
HONEY OF POLLEN CONTAINING GENETICALLY MODIFIED MAIZE MON 810 
- REQUEST BY ARGENTINA  
8.1 The Chairman informed the Council that , in a communication dated 11 June 2012, the 
delegation of Argentina requested inclusion of  the above mentioned issue on the agenda.  
 
8.2 The delegate of Argentina re iterated the concern that her de legation had raised before the 
TBT and SPS committees and before this Council on the ruling of th e EU Court of Justice of 6 
September 2011, Case C-442/09 and concerning the interpretation of Community laws following the 
detection in honey of pollen containing genetica lly modified maize MON810.  According to the 
ruling, honey containing pollen from MON810 maize and therefore honey containing pollen from authorised GMOs by the European Union, were foods produced on the basis of GMOs which fell  G/C/M/111 
 Page 11 
 
 
  within Article 3.1.c of Ruling 1829/2003, where the scope of the application had been established.  
This ruling adopted a new interpretation of the scope of the EC Regulation No. 1829/2003 on 
foodstuffs and animal feed which were genetica lly modified; this was not accompanied by the 
pertinent scientific justification.  The ruling also interpreted that pollen was an ingredient of honey 
and not a natural component; thus, this interpretati on ran counter to what was spelt out in the honey 
standard of CODEX Alimentarius , CODEX STAN 12-1981 Rev. 2001, and with the European 
regulations, Annex II of Directive 2001/110/CE and Ar ticle 6 Paragraph 2(c) of Directive 2000/13, 
where it was stipulated that honey was an ingredient per se  and therefore pollen must not be 
mentioned as an ingredient on the labelling of honey.   
 
8.3 The ruling of the European Court of Justice had triggered legal uncer tainty and exports of 
honey from Argentina to the EU had been affected  with an impact on regional economies and small 
producers.  Therefore, after nine months since the ruling of the European Court of Justice, Argentina 
was repeating its request to the EU to rapidly take all the necessary measures to lift the legal uncertainties stemming from this ruling and eliminat e its impact on the imports of honey from third 
countries into the EU.  This implementation should not lead by any means to a measure restricting 
imports of honey into the EU.    
8.4 The delegate of Uruguay thanked Argentina fo r raising an issue which was also of great 
systemic and trade importance to his country.  Uru guay also considered that this ruling had caused 
serious negative effects on the micro and smal l producers.,  Uruguay asked the EU to take the 
necessary measures to restore stability and predictability  to trade in this sector and to impede such a 
ruling from leading to a trade restrictive measure.  This measure, with no rationale or scientific 
justification, could; be set aside given its im pact on the growth of food production; and cause 
problems when responding to the growing needs in food production at world level. 
 
8.5 The delegate of Canada  stated that, consistent with Cana da's previous statements on this 
issue, his delegation shared the concern that th e European Court of Justice ruling had created 
uncertainty and had led to disruption in trade, in cluding for Canadian exporters of honey to the EU.  
He asked the EU to take expeditious action to prev ent trade disruption and assure consistency with the 
EU's WTO obligations and scientific evidence.  
8.6 The delegate of Mexico echoed the concerns expressed by Argentina.  As her delegation had 
done in other WTO bodies, Mexico wanted to see a prompt solution to this matter. 
 
8.7 The delegate of the United States shared th e concerns expressed by Argentina on the impact 
of the ruling on exports of honey to the EU.  The de termination that pollen w as an ingredient in honey 
did not reflect either the natural process by which hon ey was made by bees, or the definitions that had 
been established by international bodies including the Codex Alimentarius  Commission.  The ruling, 
and the resulting need to test and possibly labe l honey, imposed a significant and unwarranted burden 
on honey exporters.  
 
8.8 The delegate of the European Union stated that  the EU was aware of the impact that the ruling 
of the European Court of Justice might have on imports of honey to the EU.  His authorities were 
reflecting on the best possible approach to ensure  the proper implementation of the ruling without 
causing unnecessary disruptions to the supply of hone y to EU consumers, whether from domestic or 
imported production.  To this end, the Europ ean Commission had had several discussions with the 
countries concerned on this issue, including Argentin a. The EU would continue to discuss this issue 
bilaterally with Argentina and ot her affected trading partners.  
 
8.9 In the meantime, the Commission had undertaken  different steps to mitigate the consequences 
of the Court's ruling by asking companies affected to submit an application for authorization of the 
pollen in honey. The Commission had also asked th e EU Joint Research Centre to develop reliable G/C/M/111 
Page 12 
 
 
  methods of detection of GM pollen in honey to harm onize the official controls within the EU member 
States. 
 8.10 The Chairperson invited the Council to take note of the statements made and the Council so 
agreed.  
 
IX. ARGENTINA'S IMPORT RESTRICTING POLICIES AND PRACTICES - REQUEST 
BY JAPAN AND THE UNITED STATES  
9.1 The Chairperson informed the Council that the delegations of the United States and Japan, in 
communications dated 11 June 2012, requested inclusion in agenda of  the above mentioned issue. 
 9.2 The delegate of the United States expressed, on ce again, their deepest concern over the effect 
that Argentina's import license procedures and othe r restrictions were having on the rules-based 
international trading system and recalled that at this Council's meeting on 30 March 2012, fourteen 
WTO Members – both developed and developing count ries - issued a joint statement contained in 
G/C/W/667.  They, along with eight additional WTO Members who voiced their support, urged 
Argentina take immediate steps to remove or term inate its import-restrictive measures and practices.  
The US noted with concern that, instead of easing,  the restrictions seemed to be tightening and 
becoming even more onerous. As noted during th e 30 March 2012 CTG meeting, Argentina had not 
provided any solution to these problems; on the contrary, it had introduced new measures and 
reinforced existing ones, creating even mo re restrictions for the US exporters. 
 
9.3 She furthered that unfortunately Argentina "cat egorically rejects" the statements and concerns 
of the many countries that had expressed them, calling them politically motivated.  It seemed that 
Argentina was deliberately seeking to redirect attent ion from the real issues that relate to specific 
practices which Argentina had chosen to apply to imports and which we re creating global trade 
problems. Argentina had attempted to cast this  as a politically-motivated attack by developed 
countries.  This was a ploy to deflect attention away  from the specific and leg itimate concerns raised 
by a broad range of WTO Members - both deve loped and developing country Members - about 
Argentina's trade restrictive measures and practices. 
 9.4 The US believed that the WTO was wher e trade issues like these could and should be 
resolved according to an agreed set of rules.  Her authorities were increasingly disheartened that 
despite the collective protestations, Argentina see med unwilling even to acknowledge the factual basis 
of the concerns and the need to respond to them in a factual manner.  These questions and concerns 
were well-known to Argentina, and she did not inte nd to repeat them once again at this meeting; 
however the US hope was that Argentina would ac knowledge its concerns a nd terminate these import-
restrictive measures and practices immediately.  In short, the US question for Argentina, again today, 
was "When will the government put an end to th e non-transparent and restrictive measures and 
practices that have been the source of such longs tanding irritation and growing frustration to so many 
of Argentina's fellow WTO Members?"  
 
9.5 The delegate of Japan echoed the US statemen t; Japan was also disappointed by the fact that 
despite concerns expressed on various occasions by ma ny delegations including a joint statement by 
fourteen countries in the previous session of this  Council, Argentina continued to maintain import 
restrictive measures and practices such as the ove rly broad use of non-automatic import licensing, 
trade balancing requirements and pr e-registration and pre-approval of  all imports into Argentina.  
Several measures had been taken since the date of  the last Council which unfortunately increased 
Japan's concerns.  Argentina earlier requested the pr oposal of this agenda item to refrain from raising 
the same issue repeatedly in light of Rule 27 of  the CTG proceedings.  Japan would look at this 
request seriously, but at the same time noted w ith concern that further measures, having trade 
restricting effect, had been taken and ex isting measures had been strengthened.    G/C/M/111 
 Page 13 
 
 
   
9.6 Argentina was a member of G-20 and the l eaders of G-20 were firmly committed to open 
trade and investment expanding markets and resistin g protectionism in all its forms.  Japan hoped 
Argentina to roll back these protectionist measur es as soon as possible in light of the recent G-20 
leaders' commitment.  He concluded by indicating th at, given these circumstances, Japan desired to be 
joined to the consultations requested by the EU  on 30 May 2012 in "Argentina - Measures affecting 
the Importation of Goods". 
 9.7 The delegate of Turkey supported the previous statements and indicated that Turkey's 
concerns with Argentinean restrictive practices co ntinue unabated.  He once again sought Argentina 
to act in a constructive manner so  as to ease Turkey's concerns as e xporters to Argentinean markets. 
 
9.8 The delegate of Switzerland shared the con cerns expressed by the US and Japan with regard 
to Argentina's import restrictive measures, in cluding trade balancing import requirements, the 
increasing use of non-automatic import licences and pr e-approval and pre-registration of all imports 
into Argentina.  These reasons led Switzerland to co -sponsors the joint statement made at this Council 
meeting on 30 March 2012.  Switzerland was surprised  that despite the concerns expressed by many 
WTO Members for the past two years, Argentina continued to maintain those import restrictive 
measures and urged it again to put its import regi me in conformity with its WTO obligations. 
 9.9 The delegate of Australia recalled that he r delegation co-sponsored the joint statement and 
that it also raised these issues more substantively in April at the meeting of the Committee on Import 
Licensing.  Thus, Australia supported the statements made by the US and Japan. 
 
9.10 The delegate of the European Union supported the previous statements on the trade-restrictive 
measures taken by Argentina, which included the overly broad use of non-automatic import licensing, 
trade balancing requirements, and pre-registra tion and pre-approval of all imports and which 
adversely affected imports from a growing number of WTO Members.  He reiterated the EU's concern over Argentina's long standing import restricting policies and lack of transparency and predictability. 
After numerous attempts to address these protecti onist measures, both bilaterally and multilaterally, 
the EU on 25 May 2012 requested consultations  with Argentina under WTO dispute settlement 
understanding.  
 
9.11 The delegate of Colombia also recalled th at at the previous meeting of the Council, his 
delegation had expressed its concern over the non-automatic import licensing system in Argentina.  
Colombia indicated that such measures had become de facto a quantitative restriction to imports with 
tangible impact on Colombia's exports.  His delega tion reported that the negative effects of these 
measures on Colombian exports to Argentina had been aggravated over the first four months of 2012.  
Global exports to the Argentinean market had dropped by 6 per cent in April and May 2012 as 
compared to the same period of 2011.  Imports from Argentina had however increased by 54 per cent.  
During the same period, 13 tariff lines impacted by the non-automatic import licensing had seen a 
drop in their exports to Argentina by 91 per cent.  The products affected were tyres, paper and 
clothing.  As stated on previous occasions, some of these tariff lines were exports from small and 
medium sized enterprises (SMEs), therefore alongside the economic impact of these, there was also a 
social impact that had to be borne in mind.  Th ree months on, no solution had been given to this 
matter despite the numerous expressions of concern which had been brought fo rward and the attempts 
to ring-in together through the different bilateral channels which had had no e ffective response.  Thus, 
Colombia wanted to repeat the need  to ensure reciprocal treatment in  bilateral trade; the trade deficit 
between both countries was increa sing in an accelerat ed manner and these trade restrictions 
contributed even more to create an imbalance in bilateral trade alongside th e problems this posed for 
SMEs.    G/C/M/111 
Page 14 
 
 
  9.12 Colombia also regretted the lack of effectiv e response to these legiti mate concerns and called 
upon Argentina to start a dialogue through the appropria te channels with a view to eliminating these 
restrictive measures as. His delegation reiterated its opinion that that these measures were inconsistent 
with Argentina's commitment within the WTO and th erefore Colombia reserved its right to reach a 
rapid solution to this matter.  At the beginning of the meeting, Argentina had indicated that repeating 
the inclusion of this item on the Council's Agenda s eemed to be a political interest; this was not the 
case, the concern responded to a real problem witnes sed by figures, it was a problem which continued 
to increase and deserved prompt attention.  
9.13 The delegate of New Zealand also recalled that her delegation supported the joint statement 
made at the CTG meeting in March and she endorsed  the comments and statements made by other 
Members at today's meeting. New Zealand continue d to have serious systemic concerns over the 
nature and impact of the range of import restri cting measures that were being maintained and 
introduced by Argentina.  
9.14 The delegate of Israel thanked Japan and th e US for requesting the inclusion of this item on 
the Agenda of today's meeting.  Israel supported th eir statements and also echoed the various concerns 
expressed in the past regarding Argentina's impo rt restriction practices.  His delegation would 
continue to monitor developments closely. 
 9.15 The delegate of Malaysia echoed the previ ous statements; his delegation hoped this issue 
would be resolved as soon as possible. 
 9.16 The delegate of Hong Kong, China expressed  systemic concern on the issue and emphasized 
that any trade restrictive measures were not conduc ive to the development of bilateral economic ties 
and mutual cooperation, therefore they s hould be eliminated as far as possible. 
 
9.17 The delegate of Chinese Taipei shared the concerns expressed by previous speakers and urged 
Argentina to apply its measures in a transpar ent and predictable manner and without causing 
impediments to the flows of international trade. 
 9.18 The delegate of Argentina recalled that when adopting the Agenda of the meeting her 
delegation had stated that it was opposed to the use of the Goods Council for an on-going singling out 
of other Members' policies.   Members who had re quested the inclusion of this agenda item should 
respect Rule 27 of the Rules of Procedure of this  Council.  Her delegation was of the view that 
Members' policies were being singled out, as it was the case of Argentina, and in this context it was 
difficult to distinguish which were th e issues of trade inter est or concern that could be identified and 
improved in the points that had been raised.  Her delegation's position on the issues, as raised by 
delegations, had already been clarified at th e last Council meeting on 30 March 2012 when senior 
officials from her capital travelled to Geneva.  Ar gentina's statement was circulated in document 
G/C/W/668 and the key aspects of what was stated by  her delegation at that time were also contained 
in document G/C/M/110.  Argentina endorsed the leg itimacy of its policies and their consistency with 
WTO rules. 
 
9.19 The Chairperson proposed that the Counc il take note of the statements made; invited 
delegations to continue their discussion and to in form the Council of the result thereof. The Council 
so agreed.  
 
  G/C/M/111 
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  X. INDONESIA'S IMPORT RESTRICTING POLICIES AND PRACTICES - REQUEST 
BY THE EUROPEAN UNION, JAPAN AND THE UNITED STATES.  
10.1 The Chairman informed the Council that, in communications dated 11 June 2012, the 
delegations of the European Union and the United States requested the Secretariat to include in 
today's agenda the abovementioned item.   
 
10.2 The delegate of the United States informed Members of the US concerns about trade policy 
trends in Indonesia, especially the growing number of  laws and regulations that could have systemic 
consequences for access to Indonesia' s market, its attractiveness as a trading partner and its ability to 
fulfil its WTO commitments.  She indicated that In donesia was an important partner of the US, that 
the two-way trade was almost $29 billion, $27 billio n in goods and a much smaller amount, $2 billion, 
in services and that US companies had invested al most $16 billion in Indonesia.  Therefore, US 
exporters and investors had high hopes for an expanded relationship with Indonesia which was a 
large, diverse, and fast-growing country, with real  GDP growth consistently  ranging from 4 to 7 per 
cent over the past decade.  Even in 2009, when  the global economy was flat, Indonesia's economy 
grew at 5 per cent.  Moreover, the IMF forecasted Indonesia's real GDP growth at 6 to 7 per cent for 
the next five years and, as its economy had expande d, Indonesia had taken a more prominent role in 
the WTO, in the G-20 and in APEC.  The US valu ed its cooperation with Indonesia in all these 
forums. 
 10.3 Despite its impressive economic performance, Indonesia's government and legislature had 
introduced a large number of new trade and investment restrictions such as import licensing 
requirements, trading rights limitations, pre-ship ment inspection requireme nts, local content and 
domestic manufacturing requirements, including those in the energy sector, and export restrictions 
including taxes and prohibitions.  Individually, eac h policy created burdens for traders.  Together, 
these requirements created a complex web of approva ls that threaten to make Indonesia's market 
impenetrable. 
 10.4 In the area of trading rights, Indonesia's Trade Ministry was implementing Regulation 27, a 
sweeping new import restriction which was comp lex and traders found its operation difficult to 
understand.  Her authorities were told that pr oducers would be allowed to import inputs for 
production, but not finished goods for resale; this requirement was a significant problem for 
companies with global production operations that re lied on trade to serve customers in different 
countries.  Regulation 27 also included new restrict ions on companies that did not produce goods in 
Indonesia, i.e., general importers.  These compan ies might no longer import a diverse range of 
products; instead, each importer was confined to pr oducts falling in one chapter of Indonesia's tariff 
schedule.  So, a company that previously imported a dozen diverse products across different chapters 
of Indonesia's tariff schedule might now need to break  itself into a dozen specific legal entities, each 
capable of handling one product, or  find partners to do the importing for them. Also, companies might 
not act as both producer-importers and general-importers.  The conse quence of Regulation 27, if fully 
enforced, would be an intricate web of company-spec ific import restrictions.  Because this regulation 
applies to all Indonesian imports, it could have syst emic market access consequences.  Apparently,  
Regulation 27 was intended to implement an Indon esia Supreme Court finding that imports "clash" 
with domestic products and interfe re with national development obj ectives.  The substance of the 
Supreme Court's decision raised thought-provoki ng questions about the openness of Indonesia's 
economy and its ability to fulfil its WTO commitment s, including commitments related to market 
access and national treatment. 
 10.5 There were similar concerns about Indonesia's import licensing regime.  In recent years, 
Indonesia had introduced import licensing requirement s on many products; those of greatest interest 
to the United States included livestock products, textiles and apparel, a nd final consumer goods 
including electronics, household appliances, and food and beverages.  Recen tly, the government had G/C/M/111 
Page 16 
 
 
  proposed new licensing requirements for horticu ltural products.  In the Committee on Import 
Licensing, Indonesia had characterized these licens es as automatic.  However, in practice, these 
licensing procedures were non-automatic and comp lex, and there was no assurance that Indonesia 
implemented them in a consistent and predictabl e manner.  Before granting the licenses, different 
ministries or offices within ministries subjected th e license requests to multiple layers of review.  
Under the proposed new horticulture  regulation, for instance, the US estimated that each of the import 
transactions might undergo six or seven different a pprovals.  Adding to the cost and difficulty of 
compliance were other requirements that the government frequently introduced in the context of import licensing regulations such as the require ment that Indonesian government-designated 
surveyors might inspect shipments in loading ports.  These verification requirements were pre-
shipment inspection requirements under another name and were costly and unnecessary, in that the 
elements being verified – item, quantity, destin ation, and HS number of the product shipped – 
duplicated the functions of Indonesian customs when  goods arrived in Indonesia.  Indonesia had never 
credibly explained why these requirements were ne cessary or what the government expected traders 
to do if an appointed surveyor was not available at a loading port.  In the Committee on Customs 
Valuation, Indonesian officials had been reluctan t to even address these policies and had failed to 
respond to repeated requests for additional information.   
10.6 The most troubling aspect of Indonesia's licensing regime was that officials were empowered 
to consider local market conditions such as domes tic production, prices, consumption, and demand in 
deciding whether or not to grant licenses.  For at  least one product, Indonesian producers sat on the 
committee deciding whether or not to permit imports .  For horticultural products, a task force was 
being set up to consider local market conditi ons, including whether or not there was domestic 
production that would be disrupted by imports. Language elsewhere in  the regulations suggested the 
possible establishment of an import quota as the gove rnment sought to balance supply and demand.  
For livestock products, import quantities were set by the Coordinating Ministry based on Agriculture 
Ministry recommendations; these decisions were known  to stakeholders, however it seemed they were 
generally not published.  Since her authorities we re not aware of any quantitative restrictions on 
Indonesia's market access schedule, the WTO basi s for these import quotas was highly uncertain.  
Indonesian officials openly acknowledged that th ese policies were intended to promote domestic 
production, create jobs, and move the Indonesian economy up the value chain to a higher level of development.  The US could understand these objec tives, however closing the market, was not the 
best way to achieve them.  Instead of highligh ting Indonesia's natural advantages as a place to do 
business, the expanding web of import restrictions , export taxes, local processing requirements, 
foreign equity restrictions, and other polici es reduced the transparen cy, predictability, and 
competitiveness of Indonesia's commercial environment. 
 10.7 There had been a lot of national and inte rnational press attention recently to trade and 
investment policy developments in Jakarta.  Clear ly, government officials, legislators, and business 
leaders were continuing to put forward new proposal s aimed at restricting trade and protecting local 
industry – for instance, by banning exports, by forcing investors to build local processing facilities, by 
timing imports so they are countercyclical to harv ests, by allocating import rights to companies that 
have invested in Indonesia, by requiring retailers  to buy from special distributors rather than 
importers, or by seeking to confine imports to  the narrow wedge between domestic production and 
demand.  To the extent that Indonesia operationali zed these and similar proposals in its laws and 
regulations, its trade policy regime could become inconsistent with its WTO commitments and G-20 
pledge to refrain from trade-distorting policies at this important time for the global economy. 
 10.8 Her delegation appreciated the opportunity to raise these concerns with the Indonesian 
delegation and the WTO membership and encourag ed Indonesia to respond to these concerns by 
reviewing proposed new laws and regulations w ith a view to ensuring they are supportive of 
Indonesia's WTO commitments, including those related to market access and tran sparency.  In this 
context, the US recalled that in Article V III of the GATT, the whole WTO membership had  G/C/M/111 
 Page 17 
 
 
  recognized the importance of minimizing the in cidence and complexity of import and export 
formalities and simplifying import a nd export documentation.  Indonesia' s trade regime seemed out of 
synchronization with this objective.  
10.9 The US had understood that the government of  Indonesia was considering revisions to both 
Regulation 27 as well as the horticultural licensing regul ations, welcomed this news but requested the 
government of Indonesia to postpone implementati on of these regulations pending the outcome of an 
examination of its import procedures, in order to ensure that they were no more burdensome than 
necessary and were in line with Indonesia's WTO commitments.  She urged Indonesia to notify any 
revised regulations to the WTO and to provide a r easonable time period prior to implementation.  The 
US looked forward to further addressing these issues with the Indonesian government and, where it 
had not yet done so, the US hoped that Indonesia's government would promptly respond to 
outstanding questions to allow Members to have a better understanding of unfo lding developments in 
key areas.    
10.10 The delegate of the European Union shar ed the US statement; the EU was increasingly 
concerned about the recent trade restrictions intr oduced by the Indonesia especially regulations from 
the Ministry of Trade and Ministry of Agriculture  which were affecting trade negatively since, in 
some cases, they had effectively stopped imports and, in other cases, were adding to the costs of 
imports through the various licenses and permissions  required under these regulations.   In this 
respect, the EU would raise its concerns over Indonesia's regulations from the Ministry of Trade, 
Regulations 24/2011, 50/2011 and 3/201 2 which relate to the imports of  horticulture products, animal 
and animal products.  Moreover, the EU was c oncerned about the implementation of regulation 
30/2012 which - although postponed by three and a half months - still raised concerns about its 
burdensome requirements and effective ban on im ports depending of domestic availability. 
 
10.11 Furthermore, the implementation of Re gulations 89/2011 and 90/2011 as amended in 
Regulations 42 and 43 on the port of entry, shoul d be done in a non-discriminatory way allowing all 
WTO Members to obtain country recognition on an equa l footing.  In this respect, the EU would like 
to know the procedures by which apparently some WTO Members - in a very short time frame - had 
been given preferential access and, would also lik e to ask Indonesia to provide more information on 
these procedures in view of negotiating Country R ecognition Agreements.  In this regard, the EU 
should be recognized as such and not per individual EU member State. 
 10.12 In addition, Indonesia's Ministry of Trade im plementation of Regulation 27/2012 was also of 
great concern since it placed new limitation on wh at companies were permitted to import. The 
regulation was complex and traders find its operatio n difficult to understand.  Regulation 27, if fully 
enforced, would create an intricate web of compa ny-specific restrictions on who can import what.  
Since this regulation applied to all imports, it could have systemic consequences for access to 
Indonesia's market.  The EU considered that any im port condition should be transparent and nontrade 
distortive.  However, these new regulations seem ed to introduce important new procedures to 
Indonesia's import licensing regime, set quantitative r estrictions for a number of products and add 
burdensome administrative measures.  
 
10.13 Despite introducing important changes in  Indonesia's import licensing regime, these 
regulations had not been notified to the WTO, excep t the draft of Regulation 50/2011.  The EU would 
once again like to reiterate the importance of comp lying with Members' notification obligations set up 
in the different WTO agreements, as it was acknow ledged by Ministers during the MC8 in December 
2011. Thus, the EU would be grateful to hear I ndonesia's answers to the qu estions posed and how it 
intended to address the concerns raised today in th is Council as well as those questions and concerns 
raised in the different CTG subsidiary bodies earlier this year. The EU also encouraged Indonesia to 
submit notifications concerning the abovementioned new regulations to the WTO Secretariat as soon G/C/M/111 
Page 18 
 
 
  as possible.  In the meantime, while seeking a solu tion to these concerns, the EU invited Indonesia to 
consider postponing the implementa tion of the referred Regulations. 
 10.14 The delegate of Japan stated Indonesia was and would continue to be one of the most 
important trade partners in East Asia and, that for Indonesia Japan was the biggest export destination 
and the third largest origin of import.  Furthermor e, Indonesia was indeed a part of a very vibrant 
supply chain in East Asia.  With this backgr ound, Japan had been seriously concerned with 
Indonesia's recent restrictions on import licensing on industrial products and import restrictions on agricultural products.  Not only from the systemic point of view regarding market access of Indonesia 
but also its undesirable impact on the competitiveness of Indonesia both in trade and investment 
aspects.   
10.15 Since 2 May, Indonesia's Trade Ministry had been implementing Regulation 27 under which 
trading companies that were not manufacturers can  import products falling und er only one section of 
Indonesia's HS code.  General trading houses were re quired to establish different companies to import 
different sections of products in order to maintain  the current level of importing activities.  Revisions 
were under way with regard to the possibilities of Japanese general trading houses importing more 
than two sections of products on certain conditions.  Unless these conditions were flexible enough, the 
general trading houses could be seriously affect ed by this new regulation which also imposed 
restrictions on manufacturers.  Those manufacturers were allowed to import only the inputs needed for their production process but were not allowed to import finished goods for resale unless these 
were for market research, also called "Complementary Goods" in Indonesia.   
 10.16 Japan had similar concerns about the licen sing requirements on horticu ltural products under 
the Ministry of Agriculture Regulation No. 3 and the Ministry of Trade Regulation No. 30.  Under 
those regulations, the importers of horticultural pr oducts were required to obtain a recommendation 
letter from the Ministry of Agriculture and to apply for an import licence from the Ministry of Trade.  
In addition, those regulations seemed to suggest th at the import licences could be issued within a 
possible import quota.  Although Indonesia's authorities decided to postpone the implementation of 
these measures until September 2012, should they come into effect the measures could have trade 
restrictive impacts. In addition, according to the Ministry of Agriculture Regulation No. 89 of 2011, 
Jakarta's port of Tanjung Priok was now closed to importation of fresh fruits and vegetables unless 
these were from designated countries.  This meas ure would be trade restrictive given that the 
alternative port was very far away from the market.  
10.17 Japan appreciated that the Indonesian government was re-examining those measures, 
including the possibilities of changing some parts.  In Japan's view, Indonesia should not put those 
measures in full effect unless those new measures b ecome non-trade restrictive and WTO consistent 
as a result of on-going revisions.  Japan acknowledged that those measures had been taken to protect 
domestic industry and jobs, however careful consideration should be gi ven to the consistency of those 
policy objectives with Indonesia's WTO obligations.  Japan drew Members' attention to the G-20 
leaders declaration, adopted on 19 June 2012 where G-20 leaders, including Indonesia, fully 
recognized the importance of investment for boos ting economic growth and committed themselves to 
maintaining and supporting business e nvironment for investors.  Japan regretted to raise these issues 
just a few days after the G-20 leaders expressed co ncern about rising instances of protectionism and 
reaffirmed their standstill commitment until the end of  2014.  Japan urged Indonesia to comply with 
those commitments so that the positive envir onment for investment can be maintained. 
 10.18 The delegate of Korea indicated that his au thorities had been following closely and carefully 
Indonesia's agricultural import related measure.  Korea welcomed Indonesia's recent decision to 
postpone implementation of the new import regula tion of horticultural products from June to 
September 2012.  Even though Korea had alrea dy discussed this matter with Indonesia, it was  G/C/M/111 
 Page 19 
 
 
  interested in working closely with Indonesia, bot h bilaterally and multilaterally, in order to find a 
mutually accepted solution. 
 10.19 The delegate of Canada shared the concerns  voiced over Indonesia's Regulations 3, 30 and 27, 
complex and non-transparent and that could significantly impede trade.  Canada also appreciated 
Indonesia's recent announcement to delay the implem entation of Regulations 3 and 30 on horticultural 
products to 28 September 2012 and Indonesia's willingn ess to consult with its trade partners on those 
regulations.  This was a positive step; neverthe less, Canada remained concerned about the 
introduction of protectionist measures by Indonesia in  general and recalled the recent commitment at 
the G-20 level to resist the introduction of such me asures.  As noted in the Committee on Agriculture 
on 20 June 2012, Canada was part icularly concerned with new procedures applied to livestock and 
livestock products that could inhibit the growing an d mutually beneficial bilateral co-operation in 
trade in this sector.  Import procedures applied to livestock and livestock products linked the number 
of import licences issued with domestic production leve ls and prices; this might be in violation of 
Article 2 of the Agreement on Import Licensing Pr ocedures.  Indonesia also appeared to be 
introducing new import restricting policies affecting finished products via Regulation 27 which came 
into effect on 31 December 2011.  Canada urged Indonesia to respect its WTO obligations, to 
promptly notify all its import meas ures and looked forward to con tinue working bilaterally with 
Indonesia to find a satisfactory resolution to these concerns. 
 10.20 The delegate of New Zealand welcomed the re cent developments in bilateral trade between 
Indonesia and her country, including postponement of  the implementation of Regulations 3/2012 and 
30/2012 that would have restricted horticultural im ports according to domestic supply and demand.  
However, a number of Indonesia's re gulations, particularly those that affected trade in agricultural 
products, had had and continued to  have a significant negative effect on New Zealand's exports to 
Indonesia.  Indonesian Regulations governing the im portation of beef and live cattle based permission 
to import on a calculation of domestic supply and de mand.  In practice, these imposed quantitative 
restrictions that appeared inconsistent with  Indonesia's obligations under GATT 1994 as well as the 
Agreement on Agriculture.  Between 2010 and 2011, New Zealand's exports of beef products to 
Indonesia fell by over $50 million per year and, with  a more restrictive quota in 2012, trade was likely 
to drop further.  New Zealand's horticultural expor ts to Indonesia had decreased by 58% in the first 
four months of 2012 compared with the same period last year.  Indonesia's restrictive trade regulations 
had had a negative impact on businesses in New Ze aland and were denyin g Indonesian consumers 
access to imported products.  More recently, the Mi nistry of Agriculture Regulations 3/2012 and 
30/2012 had been introduced a nd though implementation had r ecently been postponed; these 
regulations would establish a similar supply an d demand calculation as the basis for granting 
permission to import horticultural produce.  This, co mbined with the closure of Indonesia's main port 
at Tanjung Priok to horticultural products through Agriculture Regulations 89 and 90 of 2011, had 
erected significant barriers to horticultural imports th at again appeared inconsistent with Indonesia's 
commitments under the Agriculture and SPS Agreements.    
10.21 As mentioned by other Members, trade Regulation 27/2012 issued on 1 May 2012 would 
limit the importation of finished products; this re gulation was opaque and had not yet been notified to 
WTO Members and a preliminary analysis raised serious questions about its consistency with 
Indonesia's WTO obligations and indicated that it would have a significant impact on companies 
manufacturing advanced food products in Indonesia.   New Zealand recognized Indonesia's rights to 
pursue legitimate objectives such as food safety a nd increasing domestic agricultural production.  
New Zealand stood ready to assist Indonesia in  those objectives and indeed was investing 
significantly in capacity building in the agricultural sector in Indonesia but contended that restricting 
imports was not a legitimate or even effec tive pathway to achieving these objectives.   
 10.22 New Zealand welcomed Indonesia's commitment at the recent G-20 Summit to reaffirm the 
standstill commitment until the end of 2014 as regards to  measures affecting trade and investment and G/C/M/111 
Page 20 
 
 
  the pledge to rollback any new protectionist me asures that might have arisen.  New Zealand 
encouraged Indonesia to notify draft regulations to  the WTO and enter into a discussion on the issues 
of concern raised by Members so that Indonesia could find non-trade restricting and WTO consistent 
means of reaching its legitimate policy objectives. 
 
10.23 The delegate of Australia thanked the EU and US for having requested the inclusion of this 
item on today's Agenda. She also thanked Indonesia for its constructive engagement on a number of 
these issues of concern to her authorities over the p ast few months and which had resulted in some 
positive developments.  Australia looked forward to further discussion with Indonesia on a number of 
the postponed proposed regulations, particularly on agricultural products, and to that end encouraged 
Indonesia to notify all measures to the relevant WTO committees.  
10.24 The delegate of Argentina stated that the refe rence made twice by the US in its statement to 
export restrictions did not correspond to export tax es; export taxes were legitimate measures under the 
WTO rules.  
 
10.25 The delegate of Indonesi a informed the Council that r ecent policy developments on the 
importation of agricultural products in Indonesia,  communicated to Member s in the Committee on 
Agriculture several days ago, constituted real ev idence that Indonesian government had the intention 
to continue discussing to address various concerns of  trading partners. Indonesia would do the same in 
other sectors that were currently discussed in va rious committees such as TRIMs, Import Licensing, 
and SPS.  The consultation process was still going and his authorities were preparing answers to 
question from Members and the notifications of new regulations.  They were also in the process of 
reviewing some of the regulations that had been mentioned by Members and had postponed 
Regulations No. 3/2012 and   No. 30/2012.   
 
10.26 As a developing country with a population of  260 million, of which about 40 million still 
living below the poverty line, his government need ed to consider very seriously developmental 
aspects and people's economic empow erment. Therefore, Indonesia's policy was not and would not 
only be focused in addressing demands for mark et access opportunities from Members, especially 
from developed countries, but rather all the polici es would be directed to address the developmental 
and economic empowerment needs of millions of poor people in his count ry. He finally noted that in 
the context of the works of the WTO bodies, Indonesia would continue to work with Members in 
addressing their concerns.   
10.27 The Chairperson proposed that the Council ta kes note of the statements made and the Council 
so agreed.  
 
 
XI. ECUADOR MIXED TARIFFS - REQUEST BY  THE EUROPEAN UNION, JAPAN, 
AND THE UNITED STATES 
11.1 The Chairperson informed the Council that  in communications dated 11 June 2012, the 
European Union, Japan and the United States, request ed the Secretariat to include in the agenda of 
today's meeting the issue of "Ecuador's Mixed Tariffs  - Request by the European Union, Japan and the 
United States.   
 
11.2 The delegate of the United States thanked Ecuador for its responses to Members questions 
contained in document G/C/W/645, the additional in formation it had provided regarding Presidential 
Decrees 367 and 372, which changed its tariff schedule with respect to a large number of products as 
well as for document G/C/669 of 26 April, 2012 c ontaining Ecuador's statement at the last Goods 
Council.  However, and despite th is additional information, the US noted that Ecuador had still not 
provided the required transparency on its ad valorem  equivalents (AVEs) since it had not submitted in  G/C/M/111 
 Page 21 
 
 
  writing the AVEs for the more than 300 tariff lines cove red by the decrees, nor an explanation of the 
methodology used to calculate the AVEs. She asked once again Ecuador to provide this information 
as soon as possible.    
11.3 Considering Ecuador's statement in G/C/669 that  "...a modification of the tariff on jute bags, 
which would do away with the existing compound tari ff and introduce a 30 per cent ad valorem tariff, 
along with a zero per cent tariff deferral up to Decembe r 2014, is scheduled to be introduced shortly.  
Furthermore, Ecuador will soon be re viewing the tariff structure in r espect of 19 selected  tariff lines, 
such as those relating to television sets", her dele gation had the following additional questions: what 
was the status of Ecuador's plan with regard to th e jute and with regard to the 19 selected tariff lines, 
such as those relating to television sets that it had cited in G/C/669 and what did Ecuador mean by "a 
zero per cent tariff deferral"?  What was a "tariff de ferral"?  What were the 19 tariff lines that Ecuador 
had selected? What were its plans to change the tariff structure of these lines and what methodology 
did it plan to use to ensure that the changes ar e in compliance with Ecuador's tariff bindings? And 
finally, when would Ecuador bring its tariffs into line with its bound tariff rates in light of its WTO 
commitments?  For the US tariff bindings were a core  tenet of the rules-based trading system, whether 
or not a country was developed or developing.  He r delegation was ready to provide these questions in 
writing if Ecuador so requested.  
 
11.4 The delegate of Japan supported the US stat ement on the mixed tariff system of Ecuador.  
Japan had expressed on several occasions in this Counc il, its systemic concerns with regard to the 
mixed tariff system for footwear, textiles, and appa rel.  Although Japan appreciated Ecuador's efforts 
to explain the system and to show that it did not l ead to the decrease of its imports of those products, 
Japan was concerned because Ecuador had not show n the calculation method for translating the mixed 
tariff rates to AVEs.  In this vein, Japan welcom ed the additional questions opposed by the US and 
looked forward to the replies to these with convinci ng explanations so that Members could leave this 
item behind as soon as possible. 
 11.5 The delegate of the European Union supported the previous statements; this issue had been 
raised on several occasions in this Council and the EU thanked Ecuador's for the information it had 
provided to some of the EU's questions. However,  there had not been any meaningful and specific 
reply to one of the more important questions ra ised, including on AVEs.  In the responses Ecuador 
had given assurances that the introduction of a system of mixed tariffs for a number of products was 
fully compatible with WTO rules. However, in the absence of a methodology for the calculation of 
the AVEs, which the EU had understood these did not exist, it was difficult to understanding how 
Ecuador established that the mixed tariffs were in line with its WTO commitments. 
 11.6 This concern also related to the daily opera tion of the mixed tariffs system, where the absence 
of a methodology for the calculation of the AVEs woul d not ensure that Ecuador's tariff bindings were 
actually respected. Thus, the EU requested Ecuador  to provide specific information on the AVE for 
each of the tariff lines covered and the methodology used  to calculate their AVE.   This was needed to 
ensure that bound tariffs had not been exceeded.  He also asked Ecuador to indicate if there was a 
specific duration for which Ecuador was planning to implement the new tariff structure on these 
items. The EU also looked forward to hearing Ecua dor's response to the questions posed by the US. 
 11.7 The delegate of Switzerland shared all the previous concerns.  Switzerland did not understand 
why Ecuador had not provided the requested in formation regarding the AVEs' methodology it had 
used for relevant textiles and footwear tariff lines.  
11.8 The delegate of Ecuador requested his full st atement to be recorded in the minutes of this 
meeting; he also recalled that, as stated in the Tr ade Policy Review of November 2011, Ecuador was  
carrying out in-depth legal and social reforms so as to develop, strengthen and give momentum to the 
domestic market thanks to the strategic objectives  established in the national development plan.  G/C/M/111 
Page 22 
 
 
  Tariffs were one of the main tools of Ecuador's trade policy. The average of MFN tariffs had gone 
down from 11.4% in 2005 to 9.2% in 2011; simila rly, almost 53.5% of the applied MFN tariffs 
applied currently run between 0 and 5%.  Furthermor e, the average rate of imports of industrial goods 
had dropped by 3 per cent points down to 7.6 per cent.  There were tariff quotas for some 17 
agricultural products which have not been used.  The opening index had gone from 53.2% in 2005 to 
63.3% in 2010.  The non-oil trade balance had had a deficit for several years and the cumulative trade 
deficit for non-oil products be tween 2005 and 2010 reached $30 b illion.  Oil income represented 
between 14 and 20 per cent of the GDP, more than half of the income coming from exports and between 20 and 30 per cent of public income.   
 
11.9 He recalled, as on previous occasions, that Ec uador did not have its own currency and used 
the US dollar.  This had two shortcomings for the co untry, loss of its own monetary policy and lack of 
monetary tools to influence the economy and, furt hermore, the increase of the Ecuadorian dependency 
on external factors.  Since 2001 and up and until 2011 Ecuadorian exports of  agricultural and non-
agricultural products had not represented more than 0.09% and 0.2%, respectively, of the world trade 
in these products.  In other words, Ecuador, despite its  efforts to export, continued to represent a small 
part of international trade and furthermore, it was also subject to the many variations of foreign 
currencies and to oil variations, an  essential product to its economy.   
 
11.10 As mentioned in a previous occasion in this Council, statistics confirmed the inexistence of 
any impact of the trade flows over the different products that had mixed or compound tariffs. As a 
matter of fact, during 2011, Ecuador registered an in crease of imports of apparel of about 64 per cent, 
of footwear of 33 per cent and for textiles of 11 per cent, compared to the figures for 2010.  He therefore highlighted that global trade flows of the tariff lines under the compound tariffs for the 
period 2009 - 2011 showed not only an increase but al so that the measures in Decrees 367 and 372 
had not impacted trade flows.  For 2012, the figures available for the first four months of the year 
indicated that the global trade of compound tariffs products had increased by 4% as compared to the 
same period for 2010, with an important increase in footwear which now reached 41%.  These preliminary figures for 2012 confirmed the trend noted for 2009 - 2011 that the application of such 
tariffs had not had any impact nor limited trade in  such products; this might be considered by 
Members because since Ecuador's policy for these products was fully consistent with the WTO objectives, the multilateral trading disciplines and the WTO agreements.  
 
11.11 With regard to Article X of GATT 1994 he a dded that it referred to the publication of trade 
measures which could have an im pact on trade measures; that the Decrees had been published in the 
official bulletin.  Furthermore, Ecuador insisted  that the commitments established in the WTO 
Agreements in no way limited the possibilities for a Me mber to review or modify its tariff structure 
according to its economic, commercial and trade circ umstances.  For this reason Ecuador considered 
that the measures at issue did fully respect the pr ovisions of Article II of GATT 1994.  Therefore the 
tariff Ecuador's reform implemente d by Ecuador in 2010 and which modified the tariff structure of 
some non-agricultural products was consistent with Ecuador's rights and obligations when it joined to 
the WTO in February 1996.  
 
11.12 In conclusion, he echoed what  Argentina had mentioned before on the Rules of Procedure and 
reminded the Council that Ecuador's compound tariffs had been considered by the goods Council on 
30 November 2010, 31 January, 21 March, 26 May a nd 7 November 2011 and 30  March and today 22 
June 2012.  His delegation, at the meeting of 27  May 2011, made a point of information to the 
Chairperson of this Council so that the Secretariat could take note of the number of sessions in which 
these matter had been dealt upon.  Therefore, Ecuador  recalled the Rules of Procedure of this Council 
and in particular Rule 27 which stated that "Rep resentatives should make every effort to avoid the 
repetition of a full debate at each meeting on any issu e that has already been debated in the past and 
on which there appears to have been no change  in Members' positions already on record." 
  G/C/M/111 
 Page 23 
 
 
  11.13 The Chairperson proposed that the Council ta ke note of the statements made and the Council 
so agreed. 
 
XII. WORK PROGRAMME ON ELECTRONIC COMMERCE 
12.1 The Chairperson recalled that at the last meeting of this Council on 30 March 2012, it was 
agreed to include again the issue of the Work Programme on Electronic Commerce as an agenda item 
of this meeting in order to fulfil the mandate of the Ministerial Decision contained in document 
WT/L/843 where Ministers decided:   
"To further instruct the General Council to hol d periodic reviews in its sessions of July and 
December 2012 and July 2013, based on the re ports submitted by the WTO bodies entrusted 
with the implementation of the Work Programme, to assess its progress and consider any 
recommendations on possible measures related to electronic commerce in the next session of 
the Ministerial Conference,"   
12.2 The delegate of Ecuador referred in extenso  to the Information Economy Report 2010 
prepared by UNCTAD, particularly where it stated that poverty had an important dimension related to 
information as very frequently the population lacked  access to essential information for it to exist and 
for its living standards, a fact which only increased it s vulnerability.  The report also indicated that, in 
the past ten years, the scope of information a nd communication technologies which could have an 
impact on development and poverty, had expanded in different areas and that, indeed, it was currently 
generating more possibilities for these technologies to  positively impact development.  At the same 
time, the participation of developing countri es, low income revenue population and several 
communities as consumers and producers of IT and communication technologies, was also evolving.  
In this scenario, the Report highlighted the impor tance of exploring all possibilities which could 
increase the impact of this new reality on developm ent.  Industrial growth could have an important 
contribution on declining poverty through income ge neration due to the diversification and/or 
improvement of existing economic activities and in establishing a new undertaking.  IT and 
communication technologies in this area could contri bute and had the capacity to offer access to poor 
population to more information a nd better communications; this would help increase income and 
living standards.  With regard to poverty alleviati on and increased development, it would be important 
to focus the attention on companies which interest ed more the poor population - micro companies 
which generated income to one third of the popul ations in developing countries as well as SMEs.  
Evidence showed that small compan ies created most jobs even tho ugh it was also the segment which 
showed the greatest job destruction.   
 
12.3 On electronic trade, the UNCTAD report indicat ed that the opportunities created by electronic 
commerce had not yet had, up to now, an impact on the smaller producers and low income countries 
and that there was limited evidence showing that producers in developing countries traded, via online, 
an important amount of goods and services.   Elec tronic commerce in the Bu siness to Business (B2B) 
and Business to Consumer (B2C) modalities had faile d in increasing the potential and tapping in the 
benefits which were expected at the beginning of  the decade; there was slow progress in electronic 
commerce with a direct impact on small producers and micro businesses.   
 
12.4 With a view to develop, in particular in  developing countries' micro and SMEs, activities 
which would promote the better tapping and use of electronic commerce and IT and communication 
technologies, it would be appropriate to consid er general objectives such as  creating capacity 
building for small producers including micro compan ies and SMEs so as to better use or exploit e-
commerce and information and communication t echnologies; use of e-commerce and IT and 
communication technologies to improve business production of small producers, including micro 
companies and SMEs and, facilitate free trade flow of the necessary technologi es to use and increase 
use electronic commerce.  He therefore invited dele gations to express their views and suggestions to G/C/M/111 
Page 24 
 
 
  work towards the preparation of the periodic review s by the General Council in its sessions of July 
and December 2012.  These reviews would be based on the reports submitted by the WTO bodies 
entrusted with the implementation of the Work Programme.  
12.5 The delegate of Cuba recognized the Counc il's efforts in considering this matter and 
supported Ecuador's statement.  She urged the CTG to  continue its work to coordinate and complete 
pending issues under the Work Programme on E-comme rce based on the existing mandate and on the 
proposals submitted by Members, including issues rela ted to the development dimension which were 
agreed by consensus at the past MC8.   
 
12.6 The delegate of the United States stated that her delegation was still reflecting on this 
important issue and would revert to this item once internal consultations on how best to proceed had 
been completed in her capital.  Over the years,  a number of Members including developing countries, 
had recognized the importance of keeping the electr onic delivery of digital products free of customs 
duties.   The US was interested in working with these and other Members to explore ways in which 
the customs duties moratorium could be more permanen t.  It was certainly an approach that a number 
of countries took in bilateral trade agreements; it ought  to be one adopted at the multilateral level and 
would also be useful to explore the various mech anisms in the WTO by which the moratorium could 
be made permanent.  
 12.7 The delegate of Nicaragua endorsed Ecuador and Cuba's stat ements.  Nicaragua attached 
great importance to e-commerce for the productive de velopment of its micro-small and SMEs.  In 
particular, e-commerce offered advantages to ensu re free access and competition to ICT for greater 
efficiency in countries' integration onto international markets. 
 
12.8 The delegate of Venezuela also supported the statements made by Ecuador, Cuba and 
Nicaragua which had stressed the importance of this mechanism; it was necessary to explore 
possibilities to put into practice the Work Programme adopted at MC8.  
12.9 The delegate of Argentina supported and shared  the interest and views expressed by Ecuador 
and Cuba. 
 
12.10 The Chair thanked delegations for their st atements and proposed to make, on his own 
responsibility, a purely factual report to the General Council on 25 July, based on the discussions in this 
Council3.  He also proposed to revert to  this issue at the next meeting of the Council in November 2012 
and the Council so agreed.  
 
XIII.  OTHER BUSINESS 
A. ECUADOR – APPLIED TARIFFS MFN 
13.1 The Chair recalled that at the start of the meeting Ecuador had requested to include under 
Other Business an item concerning its applied tariffs.  
 
13.2 The delegate of Ecuador informed the Counc il that the II Trade Policy Review (TPR) of his 
country on 15 November 2011, the Secretariat in  document WT/TPR/S/254 pa ge 39, paragraph 3, 
identified 19 tentative lines where Ecuador w as applying tariff MFN rates higher from 5-15 
percentage points than the bound rates.  Ecuador ha d been working intensivel y to make the necessary 
tariff adjustments and was pleased to inform that  the Ecuadorean Foreign Trade Committee, on 18 
April 2012, decided to modify 15 subheadings of  Annex I of the national import tariff through 
                                                      
3 See document G/C/49.  G/C/M/111 
 Page 25 
 
 
  Resolution 53 which was published in the Official Re gister number 711.  This was an additional proof 
of the good faith and swift compliance of Ec uador with its international commitments. 
 13.3 The Chairperson thanked Ecuador for its statem ent and invited the Council to take note of it. 
The Council so agreed.  
 
B. ROOM DOCUMENT RD/CTG/1  CONTAINING THE REVISED FORMAT OF THE "UPDATING OF THE 
LISTING OF NOTIFICATION OBLIGATIONS AND TH E COMPLIANCE THEREWITH AS SET OUT IN 
ANNEX III OF THE REPORT OF THE WORKI NG GROUP ON NOTIFICATION OBLIGATIONS AND 
PROCEDURES " 
13.4 The Chairperson recalled at the last meeting under Agenda item II:  "Status of Notifications 
under the Provisions of the Agreements in Annex IA  of the WTO Agreement", it was agreed that the 
Secretariat would explore ways to reduce the volume of the document containing the annual 
notifications and that a revised format, purely of  a technical nature, would be presented at this 
meeting for Members' consideration.  The reduced format proposed by the Secretariat was contained 
in Room Document RD/CTG/1.  The structure of  the current document (G/L/223 and Revisions) had 
not been changed but the reduced format containe d only notifications of the preceding three years 
under the different provisions in the Agreements in Annex A of the Marrakesh Agreement, with 
references to previous documents a nd revisions thereof in the G/L series.  It was not his intention to 
discuss this reduced format at the meeting, but invite d delegations to  prepare for its discussion, in an 
informal mode, before the next formal meeting of  the Council.  An electronic version of the room 
document was made available on Docs for Meetings.  He proposed that the Council take note of the 
information he had provided. The Council so agreed. 
 
C. DATE OF THE NEXT MEETING  
13.5 The Chair informed the Council that the ne xt meeting was scheduled to take place on 
Monday, 26 November 2012.  The agenda w ould close on Thursday, 15 November 2012. 
13.6 The meeting was adjourned. 
_________