RESTRICTED  
  
G/C/M/131  
 
5 October 2018  
(18-6194) Page: 1/62 
Council for Trade in Goods    
 
MINUTES OF THE MEETI NG OF THE COUNCIL FO R TRADE IN GOODS  
23 AND 26 MARCH 2018  
CHAIRPERSON: HE MR K YONGLIM CHOI  (REPUBLIC OF KOREA)  
The meeting of the Council for Trade in Goods (CTG, or the Council) was convened by 
Airgram  WTO/AIR/CTG/10; the proposed agenda for the mee ting was circulated in 
document  G/C/W/751. The meeting proceeded on the basis of the following agenda:  
 
1   NOTIFICATION OF REGIONAL TRADE AGREE MENTS  ................................ ....................  2 
1.1   Economic Partnership Agreement between the European Union and the Southern African 
Development Community EPA States (WT/REG381/N/1/Add.1) ................................ .................  3 
1.2   Closer Economic Partnership Arrangement between Hong Kong, China and Macao, China 
(WT/REG390/N/1)  ................................ ................................ ................................ ...............  3 
2   STATUS OF NOTIFI CATIONS UNDER THE PR OVISIONS OF THE AGRE EMENTS IN 
ANNEX  IA OF THE WTO AGREEMENT (G/L/223/R EV.25)  ................................ .................  3 
3   APPOINTMENT OF O FFICERS TO THE SUBSI DIARY BODIES OF THE COUNCIL FOR 
TRADE IN GOODS  ................................ ................................ ................................ .............  5 
4   ACCESSION OF THE  REPUBLIC OF ARMENIA  AND OF THE KYRGYZ R EPUBLIC TO THE 
EURASIAN ECONOMIC UN ION: PROCEDURES UNDE R ARTICLE XXVIII:3 O F GATT 1994 – 
REQUEST FROM THE EUR OPEAN UNION  ................................ ................................ ...........  7 
5   ENLARGEMENT OF T HE EUROPEAN UNION: P ROCEDURES UNDER ARTI CLE XXVIII:3 OF 
GATT  1994 (G/L/1051/ ADD.9) – REQUEST FRO M THE EUROPEAN UNION  .......................  8 
6   JORDAN – REQUEST  FOR A WAIVER RELATI NG TO THE TRANSITION AL PERIOD FOR 
THE ELIMINATION OF T HE EXPORT SUBSIDY PR OGRAM FOR JORDAN (G/C/W/705; 
G/C/W/705/CORR.1; G/ C/W/705/REV.1; AND G /C/W/705/REV.2)  ..............................  9 
7   PROCEDURES TO EN HANCE TRANSPARENCY A ND STRENGTHEN NOTIFI CATION 
REQUIREMENTS UNDER W TO AGREEMENTS – COMM UNICATION FROM THE U NITED 
STATES (JOB/GC/148/R EV.1 – JOB/CTG/10/RE V.1)................................ .....................  10 
8   INDI A – QUANTITATIVE RES TRICTION ON IMPORTS OF BEANS OF THE SPEC IES 
VIGNA MUNGO HEPPER O R VIGNA RADIATA WILC ZEK – REQUEST FROM A USTRALIA  ... 20 
9   UNITED STATES – SECTION  232 INVESTIG ATIONS AND MEASURES ON IMPORTS OF 
STEEL AND ALUMINIUM – REQUEST FROM CHINA  AND THE RUSSIAN FED ERATION  ...... 22 
10   INDONESIA'S IMP ORT AND EXPORT RESTR ICTING POLICIES AND PRACTICES – 
REQUEST FROM THE EUR OPEAN UNION, JAPAN, AND THE UNITED STATE S ...................  27 
11   INDIA – CUSTOMS  DUTIES ON ICT PRODU CTS – REQUEST FROM C ANADA, CHINA, 
THE EUROPEAN UNION, JAPAN, NORWAY, CHINE SE TAI PEI, AND  
THE UNITED STATES  ................................ ................................ ................................ ...... 30 
12   UNITED STATES – MEASURES RELATED TO  IMPORTS OF FISH AND  SEAFOOD 
PRODUCTS – REQUEST F ROM CHINA AND THE RU SSIAN FEDERATION  ..........................  34 
13   THE RUSSIAN FED ERATION – TRADE REST RICTING PRACTICES – REQUEST FROM 
THE EUROPEAN UNION A ND THE UNITED STATES  ................................ ..........................  35 G/C/M/131  
 
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  14   MEXICO – CUSTOM S PROCESSING FEE IMP OSED BY MEXICO ON CE RTAIN IMPORTS 
ENTERING ITS TERRITO RY – REQUEST FROM EC UADOR  ................................ ................  38 
15   EGYPT – MANUFAC TURER REGISTRATION S YSTEM – REQUEST FROM  THE EUROPEAN 
UNION AND THE UNITED  STATES  ................................ ................................ ...................  38 
16   CHINA - CUSTOMS  DUTIES ON CERTAIN I NTEGRATED CIRCUITS – REQUEST FROM 
THE EUROPEAN UNION, JAPAN, CHINESE TAIPE I, AND THE UNITED ST ATES  ................  40 
17   VIET NAM – DECR EE ON THE REGULATION  ON CONDITIONS FOR A UTOMOBILES 
MANUFACTURING, ASSEM BLING, IMPORTING, AN D AUTOMOTIVE WARRANT Y AND 
MAINTENANCE SERVICES  – REQUEST FROM JAPA N AND THE UNITED STA TES ..............  42 
18   CHINA – NEW EXP ORT CONTROL LAW – REQUEST FROM JAPAN  .............................  44 
19   MONGOLIA - QUAN TITATIVE RESTRICTION S AND PROHIBITIONS O N IMPORTATION 
OF CERTAIN AGRIC ULTURAL PRODUCTS – REQUEST FROM  
THE RUSSIAN FEDERATI ON................................ ................................ ............................  45 
20   EUROPEAN UNION – AMENDMENTS TO THE DIRECTIVE 2009/28/EC , RENEWABLE 
ENERGY DIRECTIVE – REQUEST FROM MALAYSIA  ................................ ..........................  46 
21   CHINA – MEASURE S RESTRICTING THE IM PORT OF SCRAP MATERI ALS – REQUEST 
FROM THE UNITED STAT ES ................................ ................................ ............................  49 
22   IMPORT LEVY BY WTO MEMBERS OF THE A FRICAN UNION – REQUE ST FROM THE 
UNITED STATES  ................................ ................................ ................................ .............  51 
23   UNITED STATES – SAFEGUARD MEASURES AGAINST IMPORTED CRY STALLINE 
SILICON PHOTOVOLTAIC  CELLS AND RESIDENTIA L WASHERS – 
REQUEST FROM CHINA  ................................ ................................ ................................ ... 52 
24   WORK PROGRAMME ON ELECTRONIC COMMER CE ................................ ...................  54 
25   OTHER BUSINESS  ................................ ................................ ................................ .... 60 
25.1   Date of the next meeting  ................................ ................................ ........................... 61 
26   ELECTION OF CHA IRPERSON OF THE COUN CIL FOR TRADE IN GOO DS ....................  61 
 
Before the Agenda was adopted, the Delegation of China indicated that under Agenda item "Other 
Business" it intended to raise the following two issues : (i) the United States Section  301 
Investigation and related measures ; and (ii) the United States Civil Aviation Security Equipment 
Measures. The Chairperson indicated that, under the same agenda item, he would raise the matter 
of the date of the next meeting.  
 
The agenda was so agreed . 
 
1  NOTIFICATI ON OF REGIONAL TRADE  AGREEMENTS  
1.1.  The Chairperson  recalled that, under the working procedures agreed by the Committee on 
Regional Trade Agreements (CRTA), and following adoption by the General Council of the 
Transparency Mechanism, the CTG was to be kept informed of Members' notifications of new regional  
trade agreements.1 He informed the CTG that the following two agreements  had been notified to the 
CRTA:  
                                                
1 See documents  WT/REG16, WT/L/671, and G/C/M/88.  G/C/M/131  
 
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  1.1  Economic Partnership Agreement between the European Union and the Southern 
African Development Community EPA States ( WT/REG 381/ N/1/Add.1)  
1.2  Closer Econom ic Partnership Arrangement between Hong Kong, China  and Macao, 
China  (WT/REG390/N/1)  
1.2.  The delegate of the United States  thanked the Parties to those RTAs for their respective 
notifications ; the US looked forward to learning more about these agreements during their review 
at the CRTA under the  Transparency Mechanism.  
1.3.  The Chairperson  proposed that the Council take note of the statement made and of the 
information provided.  
1.4.  The Council so agreed . 
2  STATUS OF NOTIFICATI ONS UNDER THE PROVIS IONS OF THE AGREEMEN TS IN 
ANNEX  IA OF THE WTO AGREEM ENT (G/L/223/REV.25)  
2.1.  The Chairperson  drew Members' attention to document  G/L/223/Rev.2 5, containing the status 
of notifications under the provisions of the Agreements in Annex  1A of the WTO  Agreement, and 
reminded delegation s that at the CTG's April 2017 meeting, and as requested by the delegation of 
New Zealand, a thorough discussion had taken place under this agenda item regarding Members' 
notification performance. He invited those delegations interested in again raising th e issue of 
transparency to address th is matter after the Council's consideration of the Annual Report of 
Notification Obligations prepared by the Secretariat . 
2.2.  Before opening the floor for comments on the Annual Report, he indicated that the Secretariat 
had requested him to remind delegations of the most recent  WTO Agreement, the Agreement on 
Trade Facilitation  (TFA) , which, in line with the amendment protocol adopted on 27  November  2014 
became, as from its entry into force on 22  February  2017, an Annex  IA Agreement of the Marrakesh 
Agreement , thus raising  the question of how to reflect th e TFA  notifications in the report prepared 
annually by the Secretariat, particularly as the TFA  contain ed a series of notification requirements 
of different kinds and with different ranges of coverage. A number of the TFA  notification 
requirements were somewhat specific in that they applied only to certain Members and consist ed 
essentially of information abou t when provisions were going to be implemented and whether  or not  
they require d support. But the TFA also mandate d more traditional types of transparency 
notifications, which appl ied to all WTO  Members. In this regard , and given that the Organization was 
Member -driven, the Secretariat fel t that Members'  guidance was required to understand how best 
to proceed. He therefore propose d that his successor h old consultations on this issue.  
2.3.  Returning to the  Annual Report , he informed delegations that certain information regarding the 
TBT notifications submitted by New Zealand had not been reflected accurately in the report and that 
a corrigendum w ould be issued in this regard.  
2.4.  The delegate of the European Union  thanked the Secretariat for th e Annual Report and for its 
early distribution , which  had allowed Members sufficient time to study it prior to the meeting. The 
EU had taken note of the Secretariat's comments on the TFA and would reflect upon th is issue in 
advance of the proposed consultations on how to include  TFA notifications  in the report . 
2.5.  The EU had two key concerns regarding  certain notifications  and these had  already been 
addressed at committee level : the first related to subsidies and state trading enterprises , and the 
second to import licensing . On the former, the EU was concerned that a significant number of 
notifications from major trading partners were outstanding , and that in certain cases  these 
outstanding notifications extended across several notification periods. She urged all Members to 
submit their missing notifications without further delay.  On import licensing , the overall notification 
performance appeared  to be deteriorating . The discussions at the Committee on Import 
Licensing  (CIL) on how to improve and streamline the notification process ha d unfortunately been 
blocked by certain Members but for reasons that were unclear to the EU.  
2.6.  Additionally, in the case of quantitative restrictions, t he overall level and quality of compliance  
was very low, and notification content and presentati on varie d widely. The EU looked forward to the G/C/M/131  
 
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  April 2018 workshop organized by the Committee on Market Access  (CMA)  to share experience s of, 
and discuss improvement s to, the notification process.  
2.7.  The EU was actively reflecting on how best to enhance notification performance and 
transparency . In its view, Members should discuss  not only how best to improve their notification 
record , but also how best to enhance the quality of the information provided  therein . The EU would 
wish these conversations to begin at Committee level, where notifications and reports about 
notification compliance were stand -alone items on committee agenda s. These conversations could 
then be brought together at CTG  level.  
2.8.  The EU also noted that it would be in contact  with the Secretari at with a few comments 
necessary to clarify certain information relating to the EU contained in document  G/L/223/ Rev.25. 
2.9.  The delegate of Brazil  indicated that, a fter the report's date of circulation , Brazil had submitted 
five notifications to the Committee  on Agriculture (CA) , on domestic support, market access, and 
export subsidies  (documents  G/AG/N/BRA/44 , G/AG/N/BRA/45, G/AG/N/BRA/46, G/AG/N/BRA/47, 
and G/AG/N/BRA/ 48). He asked the Secretariat to record this information in the se minutes and  in 
further revisions of its report.  
2.10.   The delegate of Japan  thanked the Secretariat for its report and reiterated its commitment to 
its notification obligations ; nevertheless, it remained a significant challenge to understand how best 
to coordinate between different authorities and how best to identify the specific information on laws 
and regulations  that was relevant and necessary . In this context, Japan believed that experience -
sharing opportunities, such as that offered by the upcoming workshop on quantit ative restrictions 
under the CMA, were an effective way to enhance Members' fulfilment of their notification 
obligations. Japan supported this type of approach.  
2.11.   On the Chair's statement on how best to reflect TFA notifications in the Annual Report, Japan 
was open to such a discuss ion among the Membership . 
2.12.   The delegate of Switzerland  stated that Members' compliance with their notification 
obligations, and the list ing of notification s contained in document  G/L/223/Rev.25 , was capital to 
the work of the WTO because it  provide d information essential to monitoring trade developments 
and rules. In this regard, Switzerland noted that the report reflected the status of notifications up to 
end-2017; nevertheless , Switzerland had submitted, since then, one  notificat ion on domestic 
support in agriculture , and a full notification pursuant to Article  25 of the SCM  Agreement. 
Switzerland stood ready to discuss with other Members the subject of how the TF  Agreement might 
best be reflected in the report.  
2.13.   The delegate of Canada thanked the Secretariat for having prepar ed and circulat ed its report 
in a timely manner. Canada had also taken note of the need to address the issue of TFA notification 
commitments in the  context of the  Annual Report , while taking into account  the innovative nature 
of certain elements of that Agreement as well as its early stage of implementation.  Canada 
encourage d all Members not only to review the report but also to use it as a means to evaluate and 
assess how best to ensure that all the nume rous outstanding notifications would be submitted as 
soon as possible.  
2.14.   The delegate of the United States  thanked and praised the Secretariat for its work on the 
report.  Her delegation would also consider the issue of TFA Notifications and looked forward to  
possible consultations on this matter.  
2.15.   The US considered transparency to be an issue of critical and fundamental importance in the 
work of the WTO, to the point that it had introduced a proposal , to be discussed under Agenda 
Item 7, on how to  enhanc e and strength en notifications and notification requirements . The US would  
present its substa ntive comments on transparency  under that agenda item . 
2.16.   The delegate of New Zealand  thanked the Secretariat for its report and informed delegations 
that New Zealand had now fulfilled its notification requirements also under Article  15.2 of the 
TBT Agreement . Consequently, it had informed the ISO of New Zealand's compliance with the Code 
of Good Practice. He requested the Secretariat to reflect this in the report.  G/C/M/131  
 
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  2.17.   New Zeal and believed that Members should work towards  improving both the notification 
performance itself, and their awareness of their notification performance. He therefore encourage d 
the Secretariat to consider how it c ould present its report in such a way as to allow Members to 
extract a maximum value from it , and expressed New Zealand 's interest in exploring how the 
reporting c ould also be used to encourage Members to improve their notification performance.  
2.18.   New Zealand was aware that Members often faced impleme ntation challenges. However, in 
certain cases , failure to comply with notification obligations was particularly egregious  and 
persistent , and this undermine d the WTO  system.  The CTG should keep its attention on the issue of 
how Members c ould improve notifications, and what information was necessary  to ensure that the 
notification reports were helpful.  
2.19.   New Zealand also considered that the CTG could play an important and constructive role by 
working on the issue of transparency in conjunction with its subsidiary c ommittee s. On how best to 
reflect the TFA in the report, New Zealand looked forward to engaging in further discuss ion of this 
issue.  
2.20.   The Chairperson  proposed that the Council take note of the  statements made and of the 
information provi ded. He also informed the Council that a corrigendum to document  G/L/223/Rev. 25 
would be issued and that he would ask his successor to hold consultations with interested Members 
on how best to include the TFA notifications in the Annual Report on the Statu s of Notifications.  
2.21.   The Council so agreed . 
3  APPOINTMENT OF OFFIC ERS TO THE SUBSIDIAR Y BODIES OF THE COUN CIL FOR TRADE 
IN GOODS  
3.1.  At the 23  March  2018 session of th is CTG meeting, t he Chairperson  informed delegations that , 
as he had explained at the informal meeting that had taken place immediately prior to this formal 
meeting, he had held consultations with Group Coordinators and interested delegations in order to 
submit to the Council a balanced slate of names of propose d candidates to chair the CTG's subsidiary 
bodies . However, despite his best efforts he was not yet able to  submit such a slate  of names  for 
Members ' consideration. He therefore proposed to suspend this agenda item in order to hold 
additional consultation s on this issue , and that he would revert to it at the appropriate  time. 
3.2.  The Council so agreed . 
3.3.  At the 26  March  2018 session of this meeting, the Chairperson  reminded delegations that he 
had suspended this agenda item as there had been no consensus among Members regarding the 
slate of names that he had prepared after having held intense consultations with Group Coordinators 
and interested delegations. However, he had since been informed that the slate of names that he 
had prepared was no w acceptable to all delegations. In this regard , he reminded delegations that 
the Guidelines for the Appointment of Officers to WTO  bodies , contained in document  WT/L/510 and 
adopted by the General Council on  10 December  2002, provided that the Chairperson  of the Council 
for Trade in Goods would conduct consultations on the appointment of the chairpersons of the 
Council's subsidiary bodies. In addition , document  JOB/GC/22, considered by the General Council 
on 27  July 2012, indicated that Group Coordinators should be involved in this process at an early 
stage.  
3.4.  He also recalled that , on 7 March  2018, all Members and Group Coordinators had been informed 
that he would be accepting proposals for candidates to chair the subsidiary bodies of the CTG. The 
consultati ons that  he had then carried out on this matter had consisted of individual meetings with 
Group Coordinators and bilateral consultations with delegations that had expressed their interest in 
the consultation process.  Based on the proposals made and suggest ions received from Coordinators 
and Members that had  responded to his call, he had prepared a balanced slate of names for the 
chairs of the subsidiary  bodies of the CTG for 2018. The slate of names had been communicated to 
delegations in a fax dated 22  March 2018 and had been considered by Members in an open -ended 
informal meeting  immediately prior to this formal meeting . At that informal meeting, Members had 
agreed on the proposed slate of names; therefore, he believe d that he was then in a position to  
propose to this Council an agreed slate of names for the chairs of its subsidiary bodies , and which 
was a list that reflect ed the transparent manner in which the consultations had been carried out, as G/C/M/131  
 
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  well as the wide diversity of the WTO  Membership. He reminded delegations that he had already 
presented the slate of names at the informal meeting and that there had been no opposition  to it. 
3.5.  The list of names of Chairpersons for the subsidiary bodies read as follows:  
Chairpersons of CTG  Subsidiary Bodies  
Committee on Market Access  Ms Zsofia TVARUSCO (Hungary)  
Agriculture  Ms Debora CUMES MARISCAL (Guatemala)  
Sanitary and Phytosanitary Measures  Ms Noncedo VUTULA (South Africa)  
Technical Barriers to Trade  Ms Kate SWAN (New Zealand)  
TRIMs  Ms Carrie  I-Jen WU (Chinese Taipei)  
Anti-Dumping Practices  Ms Karine Mahjoubi ERIKSTEIN (Norway)  
Subsidies and Countervailing Measures  Mr Pedro NEGUELOAETCHEVERRY (Argentina)  
Safeguards  Mr Hyouk Woo KWON (Korea)  
Import Licensing  Mrs Lorena RIVERA (Colombia)  
Rules of Origin  Ms Thembekile MLANGENI (South Africa)  
Customs Valuation  Mr Yuichiro OKUMURA (Japan)  
State Trading Enterprises  Mr Antonius Yudi TRIANTORO (Indonesia)  
Committee of Participants on the Expansion of Trade 
in Information Technology Products ( ITA Committee)  Mr Muhammad Nur Hadri Bin SOPRI (Singapore)  
Trade Facilitation  Ms Dalia KADIŠIENĖ (Lithuania)  
 
3.6.  He proposed that the Council agree  with the nominations as indicated.  
3.7.  The Council so agreed . 
3.8.  The Chairperson  recalled that, while all other subsidiary bodies of the Council had provisions 
in their respective Agreement or rules of procedure requiring them to elect Chairpersons , Working 
Parties did not. As a result, he proposed that the Council appoint the nominat ed Chairperson , 
Mr Antonius Yudi TRIANTORO (Indonesia), for the Working Party on State Trading Enterprises.  
3.9.  The Council so agreed . 
3.10.   The Chairperson  then observed that, on the question of vice-chairpersons, his understanding 
was that, in cases where the opti on existed under the Agreement or rules of procedure, it would be 
for the subsidiary bodies themselves to decide if they needed a vice-chair, and that it was for the 
respective committee chair to hold the necessary consultations. He asked if the Council co uld 
proceed on that basis.  
3.11.   The Council so agreed . 
3.12.   The Chairperson  thanked all Members and coordinators of regional groups for their 
constructive  cooperation , speed , and flexibility , during the consultations, and thanked also those 
delegations that had decided to withdraw their candidacy in the course of the consultation process 
to help the Council agree on a slate of names . G/C/M/131  
 
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  4  ACCESSION OF THE REP UBLIC OF ARMENIA AND  OF THE KYRGYZ REPUB LIC TO THE 
EURASIAN ECONOMIC UN ION: PROCEDURES UNDE R ARTICLE XXVIII:3 O F GA TT 1994 – 
REQUEST FROM THE EUR OPEAN UNION  
4.1.  The Chairperson  informed the Council that , in a communication dated 12  March  2018, the 
delegation of the European Union had requested the Secretariat to include this item on the agenda.  
4.2.  The delegate of the European  Union  requested an update from Armenia and the Kyrgyz 
Republic regarding the compensation request it had submitted to both countries following their 
accession to the Eurasian Economic Union  (EAEU) . More than two years after its submission the EU 
was still waiting to receive a joint offer from Armenia, the Kyrgyz Republic, Kazakhstan,  and the 
Russian Federation,  to begin substantial negotiations. The EU understood that a compensation offer 
was now imminent and looked forward to receiving it. The compensatio n offer should address those 
tariff lines under which trade ha d been most affected by the EAEU  enlargement , and tariff cuts 
should be made by all the EAEU  members concerned. However, i n the case of TRQs for agricultural 
products, compensations might be off ered by Armenia and the Kyrgyz Republic  only. 
4.3.  The delegate of Ukraine  emphasized the need to maintain a reliable, predictable, and mutually 
beneficial trading relationship between Ukraine,  the Kyrgyz Republic,  and Armenia, particularly 
following the accession of these Members to the EAEU. He reiterated Ukraine's interest in the 
renegotiation process under Article  XXVIII of GATT  1994, and recalled that trade between their 
respective countries was currently gover ned by bilateral free trade agreements and by the 
Agreement on the Commonwealth of Independent States Free Trade Area. Since Ukrainian exports 
could be affected by the integration process within the EAEU , Ukraine would closely follow the 
evolution of the r enegotiation process. Ukraine urged Armenia and the Kyrgyz Republic to follow the 
rules set out in GATT  Article  XXVIII strictly to ensure predictability and avoid any adverse effects on 
other WTO  Members, including Ukraine,  arising from these countries' ac cession to the EAE U. 
4.4.  The delegate of Japan  reiterated Japan's systemic interest in this matter and its readiness to 
engage in the negotiations and consultations with Armenia and the Kyrgyz Republic,  respectively , 
with a view to receiving appropriate compen sation under GATT  Article s XXIV and XXVIII . 
4.5.  The delegate of Canada  reiterated Canada's interest in receiving an offer from Armenia in 
response to its claim of interest s ubmitted  some time ago. Canada l ooked forward to an update from 
Armenia but, still more importantly, to action on this issue.  
4.6.  The delegate of Chinese Taipei  urged Armenia to conclude th is renegotiation by the extended 
deadline of January  2019, and looked forward to engaging in discussion s with Armenia with a view 
to receiv ing appropriate compensation under GATT  Article s XXIV and XXVIII.  
4.7.  The delegate of Brazil  recalled that Brazil had also submitted a claim of interest to Armenia 
under GATT  Article  XXVIII, and thanked the EU for its call for a formal revised offer from Armenia.  
Like others, Brazil looked forward to receiving a revised offer from Armenia and stood ready promptly 
to resume bilateral consultations with Armenia on this matter.  
4.8.  The delegate of Armenia  informed the Council that a number of consultations and exchange s 
with interested Members had taken place since the CTG's previous meeting , including  discussion s 
and an exchange of information on issues  relating to the renegotiations . However, as a full 
EAEU  member , Armenia was legally bound to coordinate its trade and e conomic policy together with 
other EAEU  member countries ; this implied reaching an agreed negotiating position.  Armenia had 
made great efforts to intensify consultations with its EAEU  partners in order to accelerate the 
process ; these  substantive discussions had now resulted in a new proposal with regard to 
compensation request s, which included a comprehensive list of goods for which Armenia was ready 
to consider the possibility of further liberaliz ing bound import duties.  Accord ing to  EAEU  internal 
procedures , this list must first be approved by the Council and Board of the EAEU  Commission , 
following which Armenia would present its new proposal to the EU . Armenia hoped that this new 
proposal would serve as a good basis for a new round of substantive bilateral and/or multilateral 
negotiations with all interested Members, and that progress would be made . 
4.9.  Regarding  Ukraine's statement, he reiterated Armenia's position on this issue, namely that it 
could not formally accept Ukraine's claim of interest and enter into GATT  Articles  XXIV and XXVIII G/C/M/131  
 
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  procedures given that a free trade regime with Ukraine already existed. Armenia considered it 
redundant to enter into tariff reduction or compensatory adjustment negotiations when  Armenia had 
already been trading with Ukraine at a zero tariff rate for over two decades.  
4.10.   The delegate of the Kyrgyz Republic  informed delegations that the Kyrgyz Republic was still 
in the process of conducting consultations, both internally and with other EAEU  members , intended 
to clarify data and other issues concerning the initial claims submitted by interested Members to his 
authorities. Following the next meeting of the Council of the Eurasian Economic Commission, the 
Kyrgyz Republic w ould provide answers to Member s' questions. His delegation hoped that the EU 
and other interested delegations would understand that this process took time . The Kyrgyz Republic 
would continue to keep Members informed of progress . 
4.11.   The delegate from the Russian Federation  took note of the concerns raised by the E U and 
other Members regarding the compensatory adjustment negotiations of the Republic of Armenia and 
the Kyrgyz Republic.  His delegation stood ready to engage in constructive discu ssion with the E U 
and other Members with a view to achiev ing a mutually satisfactory agreement on compensatory 
adjustment and look ed forward to further negotiations on this matter.  
4.12.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements  made.  
4.13.   The Council so agreed . 
5  ENLARGEMENT OF THE E UROPEAN UNION: PROCE DURES  UNDER ARTICLE  XXVII I:3 OF 
GATT  1994 (G/L/1051/ADD.9 ) – REQUEST FROM THE  EUROPEAN UNION  
5.1.  The Chairperson  drew Members ' attention to document  G/L/1051/Add.9, concerning the 
accession of the Republic of Croatia to the European Union on 1  July 2013. In this communication, 
the EU had indicated that it would not assert that Members that had submitted a claim pursuant to 
Article  XXIV:6 of GATT  1994 were precluded from withdrawing substantia lly equivalent concessions 
under Article  XXVIII:3 of GATT  1994 because this withdrawal occurred later than six  months after 
the EU's  withdrawal of concessions, provided that the claiming WTO  Member withdrew concessions 
no later than 63  months after the EU' s modification of concessions. He recalled that the CTG had 
extended the deadline on nine  occasions, namely at its meetings of 27  November  2013; 9  April and 
17 November  2014; 26  March and 10  November  2015; 15  March and 17  November  2016; and 
6 April and 10  November  2017.  
5.2.  The delegate of the European Union  stated that, as indicated at the previous CTG  meeting, the 
EU consider ed the negotiations following the accession of Croatia to the EU in 2013 as finali zed. She 
noted that the a greements with China, Uruguay,  and Brazil had already been notified and reported 
to the Committee on Market Access , in September  2017, and that these we re already in force and 
implemented. The last agreement , with New Zealand,  had been signed on 13  March  2017, and was 
currently  in the process of being ratified by the European Parliament . Following ratification , this 
agreement would enter into force and be implemented, and the  EU would then submit an addendum 
to the notification already made and to the  corresponding reports.  She did not expect these last 
steps to require much time ; nevertheless , the EU had preferred to request a three -month extension 
of the period in which affected Members would be allowed to withdraw substantially equivalent 
concessions . 
5.3.  The delegate of New Zeala nd thanked the EU for its continued engagement and celebrate d the 
signature of New Zealand's  agreement  with the EU . His delegation l ooked forward to the agreement 
soon entering into force.  
5.4.  The delegate of the Russian Federation  express ed Russia's deep concern over the E U's 
exclusion of the Russian Federation from the negotiations on compensatory adjustment under 
GATT  Article  XXIV:6 , following the EU's 2013 enlargement . His delegation had already raised its 
concerns on multiple occasions bilaterally  and at previous CTG meeting s. Despite these calls, the EU 
had repeatedly refused to engage in substantive discussion, arguing that Russia' s request had been 
submitted after the deadline set by the applicable Procedures for Negotiations under Article  XXVII I, 
adopted in 1980 ( that is, established within ninety  days from the date when the EU had circulated 
its import statistics).  G/C/M/131  
 
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  5.5.  The Russian Federation was of the view that the EU was acting inconsistently with the 
WTO rules provided for in GATT  Article  XXVIII  for the following reasons : (i) GATT  Article  XXVIII:1 
establishe d that a Member proposing to modify or withdraw a concession m ight do so by negotiation 
and agreement "with any Member determined by the Contracting Parties to have a principle 
supplying inter est". Moreover, paragraph  4 of the interpretative note to Article  XXVIII:1 state d that 
a Member "with a larger share in the trade affected by the concession shall have an effective 
opportunity to protect the contractual right w hich it enjoys" under the GAT T; (ii) with regard to 
certain products in the EU's notification, Russia was identified as a WTO Member with a larger share 
in the trade affected by the concession. In other words, the EU had recognized Russia as a 
WTO Member having principal supplying int erest; (iii) the Procedures for Negotiations under 
GATT  Article  XXVIII were not legally binding on Members , and according to the ir Chapeau they 
serve d as guidelines f or renegotiations . Their non-binding nature had also been supported by the 
Panel in EU – Poultry Meat (China)  (DS492).  In sum, the Russian Federation was of the view that 
the 90 -day guidelines should not be interpreted in a way that prevent ed any Member with a larger 
share in the tra de affected by the concession fro m being given an  effect ive opportunity to protect 
its contractual rights under the GATT.  He therefore called again upon the EU to abide by its 
WTO obligations and to engage in compensatory adjustment negotiations with Russia.  
5.6.  The delegate of the European Union , in response to th e Russian Federation,  indicated that , 
according to WTO  procedures for negotiations under GATT  Article  XXVIII , "Any contracting party 
which considers that it has a principal or a substantial supplying interest (…) should communicate 
its claim in wr iting to the contracting party.  (…)", and that "Claims of interest should be made within 
ninety  days following the circulation of the import statistics".  She reminded Members that Russia 
had asked to enter into n egotiations in a letter dated October  2013, well beyond the deadline that 
was set by the applicable Procedures. Moreover, the letter neither indicated any specific claim nor 
provided supporting evidence.  Moreover, in 2016, Russia had submitted a specific request for 
compensation on poultry , but even  if the request had been submitted in conformity with the 
procedures and within the deadlines, the Russian Federation would still not have had any entitlement 
to compensation. Indeed, the Russian Federation did not export poultry to Croatia during th e 
reference period set up for establishing compensation and nor did Russia hold either negotiation or 
consultation rights on the tariff lines concerned.  
5.7.  The Chairperson  proposed that the Council take note of the statements made and the 
EU communication con tained in document  G/L/1051/Add.9 . He also proposed that the Council agree 
on the extension of the de adline as indicated in document  G/L/1051/Add.9 , until 1  October  2018. 
5.8.  The Council so agreed . 
6  JORDAN – REQUEST FOR  A WAIVER RELATING T O THE TRANSITIONAL P ERIOD FOR THE 
ELIMINATION OF THE E XPORT SUBSIDY PROGRA M FOR JORDAN (G/C/W/ 705; 
G/C/W/705/CORR.1; G/ C/W/705/REV.1; AND G /C/W/705/REV.2)  
6.1.  The Chairperson  drew Members' attention to document  G/C/W/705/Rev.2 , contain ing a waiver 
request and a draft waiver decision submitted by Jordan in respect of the transitional period for the 
elimination of the export subsidy programme for Jordan.  He recalled that, at the Council's 
November  2017 meeting, it had been agreed that the CTG would revert to this matter at its following 
meeting, at which Jordan would update Members on any developments.  
6.2.  The delegate of Jordan  inform ed delegations that its new and WTO-compliant program me had 
been agreed by the Council of Ministers and was currently in the legislative process with a view to it 
being incorporate d into the Income Tax law . This process was  in line with the timetable for 
implementing a new program me contained in document  G/C/W/705/Rev.2. The new program me, 
which would be implemented as from 1  January  2019, complied with the Agreement on Subsidies 
and Countervailing Measures (SCM) as it had no  linkage to export activity . He assured Members that 
the current program me would be terminated by end-2018, and indicated that R egulation 
No. 106/2016 o n the income law state d that income resulting from exporting goods of local origin 
was totally exempted from income only until 31  December  2018.  Furthermore, Jordan was preparing 
its final notification to the SCM  Committee of the current subsidy program me. Jordan was grateful 
for, and appreciate d, Members' cooperation and understanding with regard to the challenges fac ed 
by the Jordanian economy , and request ed that this agenda item be included in th e agenda  of the 
next meeting.  G/C/M/131  
 
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  6.3.  The delegate of the United States  thank ed Jordan for  the comprehensive report on its reform 
efforts . The US looked forward to its completion before the end of this year  and for the termination 
of the current support programme in accordance with Jordan's schedule as submitted to Members . 
6.4.  The delegate of New Zealand  thank ed Jordan for its efforts in bringing its export subsidy 
program me into conformity with WTO  rules, and for confirm ing that the program me would be 
terminate d by end-2018. New Zealand appreciated Jordan's effort s, remain ed ready and willing to 
support Jordan in its efforts , and looked forward to receiving Jordan's further update later in the 
year. 
6.5.  The delegate of Japan  said that Japan expected Jordan to fulfil its commitment by eliminating 
its export subsidy program me by end-2018. Japan would continue to closely monitor this issue.  
6.6.  The delegate of Chinese Taipei  also thanked J ordan for its efforts to bring its export subsidy 
program me into WTO  conformity and for confirm ing that the program me would be terminated by 
end-2018. Chinese Taipei a ppreciate d Jordan's transparent approach to this matter and look ed 
forward to receiving further details of progress made on this issue.  
6.7.  The delegate of Australia  thanked J ordan for its update on progress made concerning t he 
develop ment of  a replacement WTO-compliant subsidy programme . Australia appreciate d Jordan's 
transparency and open and constructive approach , and would welcome any further details of steps 
taken towards implementation of the new program me. 
6.8.  The Chairperson  thanked Jordan  for its update and delegations for their interventions ; 
proposed that the Council take note of the statements made ; and proposed , in addition, and as 
requested by Jordan, that the Council revert to this matter at its next meeting, in July  2018, when 
Jorda n would again report on progress made.  
6.9.  The Council so agreed . 
7  PROCEDURES TO ENHANC E TRANSPARENCY AND S TRENGTHEN NOTIFICATI ON 
REQUIREMENTS UNDER WTO  AGREEMENTS – COMMUNICATION FROM THE UNITED 
STATES (JOB/GC/148/R EV.1 – JOB/CTG/10/REV.1)  
7.1.  The Chairperson  drew Members' attention to document  JOB/GC/148/Rev.1 – 
JOB/CTG/10/Rev.1 , dated 12  March  2018 and circulated at the request of the delegation of the 
United States, concerning a draft decision for the General Council's consideration on procedures to 
enhance tran sparency and strengthen notification requirements under WTO  Agreements.  
7.2.  The delegate of the United States  indicated that, among the WTO systemic and institutional 
areas on which the US remained focused and wished to reinvigorate activity so as to put the 
Organization on a path towards a more successful and sustainable future,  transparency was an 
especially important area of work , in particular to address the deficiencies and gaps in notification 
obligations. T he Secretariat 's Annual Report on Notifications , considered under Agenda Item 2 of 
this meeting , clearly indicated that compliance with notification requirements under the various 
WTO Agreements remain ed inadequate.  
7.3.  In this regard, she  drew Members ' attention to a revised version of the proposal on procedures 
to enhance transparency that had been tabled by the US in October  2017 and considered by the 
CTG at its meeting  of November  2017.  The revised proposal not only introduced changes that 
reflected Members' feedback at that meeting , but also took into consideration that MC11 had already 
taken place , and  thus that the US no longer sought a Ministerial outcome but rath er a General 
Council Decision . Therefore, the explici t provisions pertaining to TBT  notifications and the specific 
enhancements propo sed regarding fisheries subsid y notifications  had been removed . However, o n 
fisheries subsidies, a paragraph had been included to take into account the Minist erial Decision 
agreed during MC 11 to recommit to the implementation of existing notification oblig ations and to 
note that the Negotiating Group on Rules (NGR) would develop enhanced notification procedures as 
part of those ongoing negotiations.  
7.4.  An aspect of the original proposal that had not been significantly modified  was the section on 
administrative measures. Nevertheless, a minor change had been introduced to this section and G/C/M/131  
 
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  consisted of the removal of any reference to the term "delinquent ", over which many Members had 
expressed their  concern . At the same time, the ad ministrative me asures had been maintained as 
previously proposed  because,  although the US remained open to discussion and negotiation of these 
measures, her authorities strongly believed that Members that had chose n not to provide 
transparency in a timely manner should be held to account. Furthermore, the US had to date not 
heard any clear reasoning as to why such measures,  which were well -established WTO  mechanisms 
derived from Budget Committee procedures, should not apply to compliance with existing notif ication 
requirements.  Indeed, the administrative measures proposed were already and currently applied by 
the WTO  for Members in arrears , as set out in document  WT/BFA/W/410 , entitled "Outstanding 
Contributions from Members and Observers ". The US looked forward to receiving comments and 
questions , which would be forwarded  for consideration to Capital , and remained open to discussing 
the proposal on a bilateral basis ; in particular , the US  welcome d additional ideas from Members as 
to how best to confront the serious problem of lack of n otification and transparency.  
7.5.  The delegate of Ukraine  shared the view s of the US concerning the need to enhance 
transparency procedures under the WTO  Agreements.  The WTO  Committees ma de every effort to 
improve Members ' compliance with transparency requirements under the respective Agreements, 
providing guidance, technical assistance, and thematic workshops.  Nevertheless , additional steps  
remained necessary,  such as those outlined in the US  proposal . 
7.6.  Concerning the proposal , "To instruct appropriate committees to report annually on Members ' 
compliance with notification obligations" , he noted that some Members may not have compl ied with 
their transparency obligations  because of  limited resources . In this regard, he  proposed that the 
respective WTO committees c ould organize specialized workshops focus ed on ways to strengthen 
capacity, while also highlighting the practical benefits of transparency by showcasing Members' 
success stories in this area . Committees should also examine the reasons given by Members for 
non-compliance  with transparency obligations and include this information in their annual reports 
for further consideration and action.  
7.7.  On the proposal on "counter -notification on behalf of another Member" , he indicated that a 
number of notification procedures already contained clear indications and/ or formats for counter -
notification, namely in the area of non-tariff measures , such as the Agreements on Balance -of-
Payment (BOP) , Import Licensing Procedures ( ILPs), and S CM. Encouraging counter -notifications 
could be a good first  step to be considered by Committees with a view to amend ing their notification 
procedures and format s, as necessary.  Ukraine favoured engaging in a frank discussion of all other 
availa ble and potential options for giving  relevance to the issue of transparency.  
7.8.  The delegate of Mexico  thank ed the United States for the revised proposal.  Mexico was in 
favour of any efforts directed at strengthening the fulfilment of notification obligations.  The 
US proposal was being carefully examined in Capital and, as part of this review process , Mexico 
addressed the fol lowing questions to the US . Paragraph  1(a) and (b ) made a distinction between the 
Agreement on Agriculture and other Agreement s and instruments.  What was the reason for this  
distinction , and w hy had the TFA not been mentioned? Mexico acknowledged that the question of 
how these specific notifications should be handled was already under discussion but considered it 
important , never theless,  to address and include them in any effort undertaken to enhance 
compliance in the area of notifications.  Mexico noted that there were also other agreements that 
had not been included in the proposal and sought clarificat ion from the US in this regard.  
7.9.  Paragraph  7 of the proposal  made reference to counter -notifications, in particular under th e 
Agreements mentioned in paragraph  1. Mexico asked the US if the US was in fact proposing to 
incorporate counter -notifications into all of the agreements li sted there , including those which d id 
not currently contain specific counter -notification clauses , such as the Agreements on Rules of 
Origin  (ROO) and Customs Valuation  (CV). 
7.10.   With regard to paragraph  8, Mexico asked for clarification from the US as to why those 
Members that were overdue in their notifications should justify that  delay, when in the case of 
Agriculture notifications there remained a two -year deadline . 
7.11.   Mexico added that what was being  proposed by the US in paragraph  10 was similar to the 
provisions  contained in Annex  1 of document  WT/BFA/W/410 , but in the proposal a one -year period 
was granted with regard to the time -line proposed by the Committee on Budget and Finance. Mexico G/C/M/131  
 
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  asked the US to clarify the reasoning behind this proposal. Furthermore, Mexico sought clarification 
regarding the difference between paragraph  10(a)(iv) and paragraph  11 of the US  proposal , and the 
specific role of the Director -General when contacting the Minister of a Member late in submitting its 
notifications.  
7.12.   Mexico had understood that paragraph  12 would take into account the Buenos Aires Decision 
on Rules, particularly with regard to the notification procedures relating to fisheries.  This Decision 
also set out that  "Members renew their commitment to the fulfilmen t of obligations in force in terms 
of notifications, as set out in paragraph  13 of Article  XXV of the A greement on SCM" , but made no 
reference to a specific sector. Mexico was in favour of any initiative intende d to strengthen 
notification procedures , including transparency measures. However, such an exercise m ight either 
distract Members o r double their workload under the NGR. Therefore, the SCM Committee was surely 
the appropriate body to undertake this work.  Mexico looked forward to receiving the US  responses 
to the se concerns.  
7.13.   The delegate of Canada  referred to Canada's earlier statemen t on this issue,  delivered at the 
CTG's previous meeting , which remained valid . Canada agreed with the US that poor notification 
records hinder ed the work of t he WTO , and welcome d this further opportunity to discuss th e 
US proposal.  Ideas such as those contained in paragraphs  2 and 6 of the proposal , which referred 
to the organization of workshops at Committee level , and assessment of notification performance in 
Trade P olicy Reviews , were helpful and constructive in terms of improving  the Membership's 
performance in the area of transparency obligations.  He cited , by way of example,  the workshop on 
the preparation of notifications on quantitative restrictions (QRs) , organized by the CMA,  which 
would take place on 24 –26 April 2018. Based on  the agenda prepared by the Secretariat, the event 
certainly promise d to be a useful exercise in terms of raising the bar on QR transparency . He 
therefore encouraged Members to parti cipate in the event , including and especially the 130  Members 
that ha d not yet submitted a ny QR notification.  
7.14.   Regarding the revised US proposal , he acknowledged that  the US had scaled down the 
provisions on fisheries subsidies  in response to Members' feedback at the CTG's November  2018 
meeting . Canada agreed that the NGR wa s the most appropriate forum for fruitful discussion on 
enhanced transparency requirements in the area of fisheries subsidies.  
7.15.   Finally,  Canada asked the US  delegation if it had refle cted further up on the numerous 
comments made by Members during the November  meeting on the so -called administrative 
measures set out in the proposal.  Canada shared some of the concerns raised with regard to certain 
aspects of those provisions . Canada also questioned whether restricting access to documentation 
and technical assistance would serve to enhance notification performance among those Members 
currently striving to meet their commitments but lacking the resources or capacity effectively to do 
so. Similarly, Canada shared the concerns raised by other Members over whether the proposed 
administrative measures might  not serve to weaken rather than strengthen Members' capacity to 
provide timely notifications.  And even if the proposed new measures were inspired by pre-existing 
WTO measures, Canada questioned whether provisions currently used in a budget ary or financial 
context would really be appropriate for work in other areas.  
7.16.   The delegate of New Zealand  thanked the US for its revised proposal. Members ha d clear and 
binding obligations ; therefore , persistent non -compliance needed to be addressed through the 
development of appropriate incentives. New Zealand  supported the general intent of the US proposal 
and many of its specific elements, especially with regard to the suggestions it contained for potential 
Secretariat work . New Zealand was interested in exploring the proposal in more detail with the wider 
Membership.  
7.17.   Like Mexico, New Zealand wished to receive  clarification from the US concerning the scope  of 
its proposal . New Zealand again questioned the "differential treatment " in the US  proposal  between 
the Agreement on Agriculture , certain other  goods agreements , and certain missing agreements ; 
the absence of notification obligations under the MC10  Expor t Competition Decision , and the 
MC9 TRQ Decision , were examples of the latter . New Zealand wished to know if and how these would  
be covered.  
7.18.   Equally, on domestic support in agriculture, New Zealand  was eagerly awaiting notifications 
from a number of Member s, including major subsidizers . In that regard , New Zealand continue d to G/C/M/131  
 
- 13 - 
 
  question the rationale behind the generous extension of the time -frame for agriculture notifications, 
from its current 90  days, to as many as 720  days.  
7.19.   New Zealand understood that some Members ha d complex domestic support systems  but was 
of the view that those Members able to administer such complex systems also tended to be those 
best able to compile  the relevant information concerning their systems and then to provide that 
informa tion to Members. Members should therefore ensure that the incentives proposed were the 
right ones, and not those that would instead serve simply to reinforce disengagement . In other 
words , it was also important to provide support and assistance to Members,  in a combination of 
carrots as well as sticks.  
7.20.   The delegate of the Republic of Korea  thanked the US for its revised proposal , which was 
currently being assessed in Capital. Korea shared the proposal's objective of strengthen ing and 
enhancing transparency, particularly as notification requirement s were fundamental elements in 
WTO obligations.  However, given this issue's technical character, and the comment s made by  
previous speakers, Korea believe d that sufficient time should be set aside for its further discussion.  
7.21.   The delegate of the European Union  welcomed the revised proposal and reiterated the 
importance the EU placed on  enhancing transparency and improving the quality of notifications . The 
US proposal was valuable in this regard.  Further, the EU appreciated US efforts to address Members' 
concerns and believed that the revision ha d led to an improved document . Nevertheless, the EU 
wished to make  the following preliminary comments : (i) the EU agree d that it was preferable , in the 
area of  notifications,  to rely on specialized committees rather than solely on the CTG. In fact, all 
subsidiary bodies under the CTG should be called upon to critically assess the notification 
performanc e in their respective areas , and whether or not the regular reporting and reviewing 
mechanisms were effective.  The EU believed that reporting and discussion at the Committee level 
should focus not only on the number and timeliness of notifications received but also on qualitative  
aspects, such as  whether or not the information contained in a notification was pertinent in light of 
the notification requirement s set out , as well as operators'  needs in terms of transparency.  In this 
regard, the committees m ight benefit from horizontal guidance ; (ii) the EU support ed the 
reactivati on of the Working Group on Notification Obligations and Procedures  (WGNOP or WG) , which 
had carried out some useful work in the 1990s , and suggested that Members discuss in detail their 
expectations with regard to the WG and, in particular,  how it should interact with the committees.  
An outcome of the W G's deliberations was the document discussed under agenda item  2, on the 
listing of notification obligations and compliance therewith. As stated under that agenda item, the 
document in question provided a useful overview across agreements , but the scope and  potential 
was there for making the document more useful  still. The WG could also consider how reporting on 
notifications could in future incorporate certain qualitative aspects ; (iii) the EU also agree d that it 
would be worthwhile to update the 20-year old Technical Cooperation Handbook on Notifications 
(WT/TC/NOTIF/INF/3) ; however, f or this purpose , the Services and TRIP s Councils would also need 
to be involved ; (iv) at previous CTG meeting s various doubts had been expressed concerning the 
suggestion to impose on  Members systematically lagg ing behind in their notification obligation s 
similar administrative measures to those currently applied to Members in financial arrears. Certainly, 
the EU believed that systematic  and deliberate non -compliance with key WTO  rules should not be 
without consequence. Therefore, the EU was open to giving its consider ation to the question of  how 
certain  measures used in the context of the Budget Committee could  be adapted for non-compliance 
in the area of notification obligations; at the same time, the EU considered that any such measures 
must be realistic and proportionate , and this appeared doubt ful in the case of cutting  off a Member 
from access to official W TO documentation or to the WTO  website ; (v) the EU believed that the 
prepar ation of timely  and complete notifications was resource  intensive , and smaller developing 
country Members may often experience capacity challenges  in this regard , despite assistance  already 
available ; for this reason,  sanctions or administrative measures should be matched, where 
necessary, with adequate capacity building . In addition , a Member 's exemplary performance , and 
specific key improvements , were equally as important as highlighting another Member's negative 
performance. The W G would perhaps be well placed to formulate appropriate  incentives and to 
assess , in cooperation with the Secretariat , whether or not existing technical assistance and training 
on notifications neede d to be made more effective.  
7.22.   The EU st ood ready to discuss this matter further, and considered it important to continue 
the present discussion not only at CTG  level, but also at committee level , and  informally with 
Members.  G/C/M/131  
 
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  7.23.   The delegate of Japan  thanked  the US for its revised proposal . Japan not only support ed the 
purpose and intended direction of this new proposal , but also believe d it to be essential to the work 
of WTO  bodies in implementing existing WTO  Agreements.  Japan was currently reviewing the details 
of the proposal and had taken note of Members ' concerns over whether or not administrative 
measures would truly contribute to wards  strengthening notification compliance . For exam ple, 
blocking access to the WTO  Members ' websi te, training , and technical assistance , might in fact 
discourage Members from fulfilling the ir obligations , and even be come  an obstacle to them doing so . 
Members should therefore be cautious about adopting such an approach.  Japan stood ready to 
discuss thi s issue further among all Members.  
7.24.   The delegate of Chinese Taipei  appreciated ongoing  US efforts to enhance transparency  and 
thanked it for the revised proposal that now took into account certain concerns that Members had 
raised at the CTG's previous meeting.  Her delegation was still reviewing the new text but 
nevertheless wished to share some preliminary comments , particularly  on paragraph  7, relating to 
counter -notification in the absence of a Member 's own notification . Chinese Taipei noted, for 
exam ple, that  it might be problematic al to notify technical requirements or conformity a ssessment 
procedures  (CAPs), in particular in light of Article  2.9 of the TBT  Agreement , because Members held 
different opinions on the issue of how to recognize whether or not a technical regulation or CAP did 
or did not have a significant impact on another Member 's trade.  She requested the US also to take 
these particular aspects into consideration.  
7.25.   With regard to paragraph  10, her delegation continued to  reflect upon and  look carefully at 
the kind of impact a punishment or an incentive -based system might have on improving and 
increasing notification compliance. In any case, Chinese Taipei attach ed great importance to 
enhancing transparency  and believed that further consult ations sh ould be held  in this regard.  
7.26.   The delegate of Brazil  thanked the US for its revised proposal , and previous speakers for their 
comments , which help ed Members to develop a clearer understanding and evaluation of th e 
proposal , particularly  with regard  to certain shared doubt s and questions  in line with those  raised 
by Mexico and Canada.  Brazil attache d great importance to transparency provisions and notification 
obligations in the WTO  Agreements  and remained open to discussing any initiative that c ould 
contribute to improvements in the implementation and monitoring of these commitments on the 
part of the Membership.  
7.27.   In this vein, Brazil recognize d the improvements introduced in the revised US proposal, bo th 
in language and in substance, and in particular the changes made to paragraphs  2 and 3, which 
reinforce d cooperative action to promote transparency, an aspect important to Brazil . Likewise, an 
attempt had been made in paragraph  9 to address concerns raised  by Members at the CTG's meeting  
in Novemb er about the Secretariat role in making notifications on Members' behalf.  
7.28.   Brazil also welcomed the new approach i n paragraphs  4 and 12, which , as indicated by 
Canada, reflected specific improvements in the area of notifications to the relevant committees o f 
agricultural and fisheries subsidies. Nevertheless , Brazil still held reservations and doubts concerning 
the proposed differential treatment for agriculture indicated in paragraph  8. 
7.29.   While praising the proponent 's effort s to take into account certain of the concerns expressed 
by Members at the CTG's meeting in November  2018, Brazil considered that the approach proposed 
by the US for tackling the problem in question remain ed the same, as had been recogn ized by the 
US delegation  itself earlier in the meeting.  This was particularly the case as concerned paragraphs  8 
to 11, which ha d remained essentially intact.  Brazil considered that, at the end, this proposed 
approach could undermine the collaborative nature of the work being carried out in the regula r 
committees, without a ny clear benefit in terms of notification  quality . In this regard, Brazil 
considered that the quality of notifications was as important as the ir timeliness, a point also made  
earlier by the EU.  
7.30.   For Brazil, doubts also existed over the legal character of the approach proposed in 
paragraphs  8 to 11 of the revised proposal.  Brazil did not share the view that one approach to 
notification non -compliance could be to draw an analogy with administrative measures applied to 
Members in arrears with their financial contributions to the Organization . In Brazil's view, this was 
not appropriate , as the design and application of administrative measures applied to Members in G/C/M/131  
 
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  arrears with their financial contributions to the Organization was mandated by Article  7.2(b) of the 
Marrakesh Agreement. No such framework exist ed for non -compliance with notification obligations.  
7.31.   In Brazil's view, if the US wished to pursue this path, a General Council Decision would 
probably not be the appropriate instrument ; rather, it  would be necessary to propose these 
measures as amendments to the multilateral agreements.  Nevertheless, Brazil stood ready to 
continue to engage in discussions on this important issue , with the US and the entire 
WTO Membership.  
7.32.   The delegate of Singapore  welcome d efforts to improve transparency  and appreciate d the 
revised US proposal.  Singapore ha d been supportive of and continue d to support efforts to enhance 
Members' compliance with their notification obligations.  Members' timely and complete notifications 
were crucial to the WTO's monitoring function and contribute d to the overall predictability of the 
MTS. 
7.33.   Singapore considered it useful to understand the underlying reasons for non -notification. 
Sometimes non -notifications were the result of a lack of understanding or technical expertise 
necessary to fulfil the notification obligations  in question; in this regard, Singapore support ed 
capacity -building efforts to address these challenges.  Singapore considered the US suggestion to 
update the Techn ical Cooperation Handbook on Notifications to be a constructive one ; such an 
update could  take into account more recent committee decisions and recommendations with regard 
to notifications.  
7.34.   Singapore was concerned by certain  aspects of the administrative m easures laid out in 
paragraph  10 of the proposal but nevertheless wished  to engage with the US and all Members on 
the issue of how to improve transparency and adherence to WTO  notification obligations ; Singapore 
would therefore welcome further discussion of this proposal.  
7.35.   The delegate of Hong Kong, China  indicated that h er delegation supported all efforts to 
improve notification performance , considered transparency crucial to the well -functioning of the WTO 
and a predictable trading environment , and thanked  the US for its revised proposal.  
7.36.   Hong Kong, China support ed the suggestions in paragraph  2 of the revised proposal , namely  
that the appropriate committees and working groups could enhance  efforts to assess and make 
recommendations to improve Members' notification compliance.  Indeed, the complexity and  
technicalities involved in the notification obligations var ied across different WTO  Agreements , and 
the WTO  body responsible for a particular Agreement would be best placed to assess Members' 
difficulties in relation to the notification obligations for that Agreement, and to address the ir 
challenges in the most effective and efficient way , whether by streamlining the notification 
procedures , by targeted technical assistance, or by setting an appropriate target  and timetable for 
raising the compliance rate.  
7.37.   Concerning the role of the W GNOP mentioned in paragraph  3 of the revised proposal , she 
sought clarification from the US with regard to the 'systemic and specific improvements' that the 
WG would consider, and on how duplication of work between this WG and the current committees 
could be avoided. The WGNOP, established in 1995 under the Marrakesh Decision on Notification 
Procedures, with specific terms of reference , had not been active after completion of its report to 
the CTG in 1996 . Hong Kong, China wondered whether the WG needed a modified mandate under 
the proposal.  
7.38.   Regarding the Secretariat's role in providing notification s on behalf of a Member , Hong Kong, 
China had doubts about such an option because of the limitations established in Article  VI of the 
Marrakesh Agreement Establishing the WTO, which require d that "[…] staff of the Secretariat shall 
not seek or accept instructions from any government … ". She asked the Secretariat to provide 
information in this regard.  
7.39.   Concerning the administrative measures suggested in paragraphs  10 and 11, Hong Kong, 
China doubted if punitive measures would be effective in raising the rate of notification compliance  
in light of the  operational challenges caused by the large  number of different notification types and 
different timing s for submissions. She asked if the same administrative measure would apply to a 
Member that could not submit any notification  at all, as to another Member that had submit ted all G/C/M/131  
 
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  but one of its notification s within the established deadlines . Considering the proposal  tabled, and the 
possible role of working groups  and committees in assessing and recommending how to improve the 
overall rate of notification compliance, perhaps it would also be worth  leaving more flexibility for the 
WG or the relevant committee  concerned  to decide on the measures most appropriate.  Hong Kong, 
China,  looked forward to contributing constructively to this process.  
7.40.   The delegate of Norway  thanked the US for its initiative t o improve notifications . In Norway's 
view, the proposal contained several elements that could be reflected upon  further , such as to revive 
the W G, to review and update the notification requirements and formats of the Committee on 
Agriculture, and to use th e TPRs more actively.  However, Norway was not of the view that  the 
Secretariat should actually provide notifications on a Member 's behalf, not even with the prior 
approval of the Member in question; nevertheless, the Secretariat did play an important role in 
assisting Members with capacity constraints to fulfil their notification requirements in a timely 
manner . Norway also believed that , if a Member d id not comply with its notification commitments 
by a given deadline, the Member in question should explain the reasons for the delay and indicate 
to the Membership the intended date on which the notification would  be submitted to the WTO.  
7.41.   As pointed out at the CTG's previous  meeting, Norway believe d that positive incentives m ight 
prove more effective than punit ive actions in achieving the results desired; in particular, Norway did 
not believe that the suggestions put forward in paragraph  10(a)(1 -3) would be conducive to better 
reporting, nor those put forward in paragraph  10(b) and paragraph  11, and these sectio ns of the 
Draft Decision should , in Norway's view,  be deleted . By contrast, Norway did wish to review 
paragraph  10(a)(4 -6). 
7.42.   Concerning  the ongoing fisheries subsidies  negotiations , Norway believe d that the instructions 
given at MC11 were sufficient at this  stage ; it was therefore unnecessary  to seek additional 
guidelines . 
7.43.   The delegate of Switzerland  noted that t ransparency was a fundamental and key element in  
a well -functioning MTS, as well as a prerequisite for effective monitoring of WTO  rules. Switzerlan d 
had been a long -time advocate for enhanced transparency at the WTO  and welcome d the objective 
of the proposal  and its revision . Nevertheless, Switzerland had some comments and questions 
concerning the issue of counter -notifications in paragraph  7, such a s how such a mechanism would 
work in practice, on the basis of what information , and with what consequences . 
7.44.   Regarding  the proposed sanctions , Switzerland noted their similarity to those established 
under the Budget Committee.  However, doubts remained over  how such administrative measures 
as placing a restriction on access to documentation, or to the WTO  Members' website, would 
effectively improve notification compliance rates.  Instead, Switzerland believed that m ore 
consideration should be given to a stron ger role for positive incentives and support.  
7.45.   Switzerland recognized the distinct nature of the notification obligations under the T FA, but 
recalled the importance given to timely and complete notifications in that case as well.  Switzerland 
stood ready to engage constructively in further discussion of how to enhance transparency and 
strengthen notification requirements, and look ed forward to clarification from the U S on the various 
points that had been raised.  
7.46.   The delegate of South Africa  indicated that her  delegation had taken note of the revised 
US proposal. However, at the CTG's November  2017 meeting , South Africa had provided comments 
on the initial draft  that the US had not taken into consideration , particularly as concerned  
administrative measures . She stated that, although transparency was a vital ly important element in 
the WTO's work, the primary objective of the Organization wa s of still greater importance , including 
the development of a trade environment that support ed and contribute d to further development and 
growth globally , in particular for developing  and LDC countries.  
7.47.   South Africa did not believe that the institutional effectiveness of the WTO would be enhanced 
by expanding the transparency mandate to include punitive administrative measure s, the 
consequences of which would render Members inactive and without access to WTO  resources. Such 
an approach  could also subject WTO  Members to dispute settlement. In short, the proposed course 
of action would have a disproportionately negative impact on the very Members requiring most 
assistance , that would effectively be further penaliz ed as a result  of their capacity constraints , a G/C/M/131  
 
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  cause for deep and genuine  concern. Moreover, i t was unclear from the proposal how once -only 
notifications, ad hoc notifications , and notifications without a ny clear deadline would also be 
subjected to punitive administrativ e measures based on timelines.  
7.48.   In addition , the proposal d id not adequately consider how the varied reasons for inadequate 
notification complianc e could be addressed  in such a way as to assist and encourage Members to 
notify. And it was important to note that the reasons for delays in submission and absence of 
notifications were various and depended on  a number of different factors.  
7.49.   The WTO  Secretariat already monitor ed Members ' compliance with regular notification 
obligations through its updates of document  G/L/223 on  the status of notifications in the different 
committees ; and  TPRs also gave often an update o f Members ' notification status. In this context, it 
was not clear what the proposed standardized focus on notifications for trade policy review would in 
fact entail. In any case, TPRs were not intended to serve as a basis for the enforcement of specific 
obligations under the WTO Agreemen ts, for dispute settlement procedures , or to impose new 
commitments, but were intended instead to provide a clearer understanding of Member s' trade 
policies and practices.  
7.50.   In addition, the WTO Secretariat could not submit notifications on behalf of Members  
regard ing the agreements covered by th e proposal when there was no mandate and certainly no 
agreement among Members for it to do so.  Most WTO  Agreements contain ed GATT  Article  X-type 
provisions, referring to publication and administration of trade regulat ions; these provisions 
concerned  transparency and procedural due process. Therefore, the US should explain why the 
proposal focuse d only on Annex  1A Agreements , with a specific and standard focus on notifications 
relating to these agreements in Members ' TPRs, while it exclude d the Annex  1B General Agreement 
on Trade in Services.  
7.51.   South Africa d id not agree that this proposed decision should be considered by the General 
Council ; rather, all  monitoring and notification requirements c ould be reviewed in the relevant 
WTO Committees. Nevertheless , South Africa did remain open to further discussion of how to 
improve Member s' compliance with transparency procedures and obligatio ns in the relevant 
committees.  
7.52.   The delegate of Cuba thanked the US for its revised pro posal but regret ted that the concerns 
raised by her delegation, in line with those  raised by other delegations from developing countries, 
remained unaddressed. She therefore indicated that the statement made by Cuba on 
10 November  2018 remained valid.  From the earlier discussion , it was clear that no  Member 
contested the importance of transparency within th e WTO . However, it concern ed Cuba  that the  
proposal adopted a punitive approach  to the issue of notification non -compliance . Cuba's  view was 
that it was the DSU 's role  to examine the applica tion of administrative measures, and that the issue 
already formed part of the discussions in that forum on framework and negotiations.  The idea of 
adopting a mandate that would correspond to the subsidiary bodies was not in line with the logic 
followed in the WTO that preserve d a bottom -up approach, and t he initiatives on specific items, 
which include d agriculture, should instead be submitted to the proper technical committees.  
7.53.   Cuba also considered that the recommendati on contained in paragraph  6, on trade policy 
reviews,  was not relevant to this Council ; indeed , following the logic  of the aforementioned 
paragraph , these initiatives should themselves be submitted and examined in the framework of the 
periodic reviews of t he Trade Policy Review Body. This, after all, was the forum where, from a holistic 
perspective, all issues relat ing to the implementation o f the reviews should take place , and where 
adoption , by consensus,  should likewise take place . Similarly, the initiat ive relating to notifications 
on fishery subsidies should instead be a contribution made within the framework of negotiations on 
fishery subsidies. In summary, the proposal, given its selective approach, fell outside the remit of 
the CTG , as had already be en clearly stated  at the November CTG  meeting.  
7.54.   Cuba could not support this in itiative , considering its approach counterproductive . Many 
developing countries and LDCs were going to great efforts to comply with their notification 
obligations despite a persistent lack of resources and infrastructure. Therefore , the solution to the 
current challenges should be found through a collaborative approach and not through strengthened 
monitoring and punitive measures.  Indeed, in today's circumstances, the WTO require d collaboration G/C/M/131  
 
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  and cooperation more than ever as its foundational approach.  In this spirit, Cuba was open to a 
frank and honest dialogue on this or any other issue within t he WTO.  
7.55.   The delegate of Australia  thank ed the US for its proposal.  Australia support ed the objective 
of increasing compliance with WTO  notification and transparency obligations , was interested in 
exploring the various options to do so , and looked forward t o working with the US, and other 
Members, to support these objectives in 2018.  
7.56.   The delegate of China  echoed others in thanking the US for tabling a revised proposal  on 
transparency. China support ed enhancing transparency in the WTO , of which notification s were an 
important element . Transparency ha d the merit of contributing to a stable , predictable , and 
transparent national trading environment ; it also helped to promote trade liberalization and 
facilitation in general.  China noted that the US had deleted the term "delinquent" from its initial 
proposal , and considered this to be a positive step. However , and as stated  already on previous 
occasions , China was more inclined to support  measures that encourage d cooperation and that 
assisted Members in meeting their notification obligations , rather than punitive measures of the kind 
set out in the proposal, which China believed would not help developing country Members in their 
goal of fulfilling their notification requirements.  
7.57.   Similarly,  China believed that referring to a Member whose notification s were long overdue  
as an "inactive Member " went in a punitive direction; China did not consider this to be the appropriate 
term in this context . 
7.58.   Regarding the reference to TPR s and the possibility that specific part s of TPRs could be 
dedicated to notification issues , China noted that some  Members had questioned such an approach . 
For its part, China requested further clarification from the US concerning how a standardized section 
in TPRs could be feasible given that Members held differing views on which specific or non -specific  
notifications were actually required  of them . Given these differing interpretations  it would certainly 
be difficult to standardize a section of TPRs only on not ifications. China was also of the view that the 
cooperative measures suggested in th e proposal were worth y of further  exploration , and echoed 
other  delegations in supporting the Secretariat in its role of enhancing  Members' capacity via 
workshops. The Secretariat could organize additional training courses on notification disciplines and 
perhaps also invite those WTO Members that were successful in fulfilling the ir notification obligations 
to share their experience s and reflections.  
7.59.   In summary, China stood ready to work with the U S and other Members towards  improving 
transparency in notification s, but on the basis of a cooperative and not a punitive approach . 
7.60.   The delegate of Egypt  thank ed the US for its revised proposal and for trying to take into 
account Members' comments  made at the CTG's November  2017 meeting.  The proposal contained  
many constructive ideas , especially in paragraphs  2, 3, 4, and 5 . Egypt noted  that there was broad 
agree ment among Members that enhancing transparency and improving Members' compliance with 
notification requirements were important objectives , even if there also existed many different 
possible approaches to achieving those objectives . Egypt  believe d that the main concern with th e 
revised proposal remain ed the proposed a dministrative measures against Members , which in Egypt's  
view would not encourage Members to meet their notification commitments. Egypt believed that the 
right approach  was rather to enhance  notification compliance by giving priority to the needs of 
developing countries an d LDCs in the areas of capacity -building and technical assistance . Egypt also 
noted that Members held differing views on whether or not a subsidy measure was "specific" and to 
be notified, and the  US proposal failed to  address such i ssues . In conclusion, Egypt stood  ready to 
engage in any discussion at committee level of possible  ways to enhance Members' compliance with 
their notification obligations . 
7.61.   The delegate of Pakistan  said that h is delegation agree d that improving Members' com pliance 
with their notification requirements was an important objective.  However, the administrative 
measures set out in the proposal , punitive in character, would most hurt those Members that were 
genuinely struggling to meet the requirements.  In this reg ard, he observed that some of the 
notification requirements under the WTO  Agreements were highly  technical and require d a lot of 
effort in terms of collecting the relevant data and coordinating among the various different 
designated authorities responsible  for compiling  the notifications.  The suggestion by the US would 
be counterproductive to achieving the intended purpose.  In other words,  many Members faced G/C/M/131  
 
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  genuine capacity constraints which ha d to be considered and a more collaborative approach should 
be adopted.  His delegation looked forward to engaging in further  consultations on the proposal.  
7.62.   The delegate of Senegal  also thanked the US for its proposal and , like others , highlighted the 
importance of transparency as a fundamental pillar in the WTO 's work. Many Members face d 
administrative and financial limitations and should be encouraged to fulfil their obligations in a 
positive and constructive manner , such as by strengthening their capacity and updating the lists of 
obligations. Senegal shared other Me mbers' concerns regarding a proposal to punish Members 
through administrative measures, particularly in the case of certain developing Members and LDCs , 
which faced technical, institutional, and financial limitations that should also be taken into 
consider ation. Furthermore, Senegal was concerned by  paragraph  12 of the proposal, which seemed 
to offer a mandate for enhanced notifications, an issue that did not fall within the scope of the 
Buenos Aires Decision. Senegal remained open to further discussion of  this issue , based on a 
constructive approach and with the intention of developing  a positive mechanism that would 
incentivize Members  to meet their notification requirements . 
7.63.   The delegate of the Bolivarian Republic of Venezuela  noted the changes that had been 
introduced into the US  proposal and reiterated Venezuela's continued interest in strengthening 
notifications and the WTO's important transparency obligations. The proposal continued to be 
evaluated in Capital and Venezuela's concerns raised a t previous CTG meetings remained valid, 
particularly over the punitive approach  and the possibility of the Secretariat preparing notifications 
on a Member 's behalf . In Venezuela's view, a more  positive approach would be to improve the 
capacity of developin g and LDC  Members so as to help them more successfully to fulfil their 
transparency obligations.  
7.64.   The delegate of Turkey  said that his delegation also believed transparency to be a 
fundamental pillar of the MTS, and support ed the principle of strengthening transparency in the 
WTO. The new proposal was still being evaluated in Capital , but Turkey wished nevertheless to make 
three  preliminary comments : (i) the notification requirements on fisheries subsidies beyond 
Article  25.3 of the SCM  Agreement should be determined according to the agreed prohibitions in the 
ongoing negotiations in the NGR ; (ii) the approach set out in the US  proposal, especially in 
paragraphs  4, 9, and 10 therein, required caution  so as to avoid damaging  the overall structure and 
function ing of the WTO while trying to fix poor compliance with transparency obligations; and (iii)  it 
might not be effective to impose new penalties with regard to  existing transparency requirements. 
The punitive administrative measures were difficult to understa nd, especially when the infringement 
of certain very basic WTO  rules and principles by some Members would not be subject to the same 
approach  and treatment . 
7.65.   The delegate of India said that India strongly believe d in transparency, considering it to be  
one o f the main pillars of the rules -based multilateral trading system , which provide d Members with 
information and clarity regarding other Members' laws, regulation s, and new measures.  India had 
significantly improved its notification compliance with regard to  a number of committees  despite the 
fact that India sometimes had difficulty collecting information, particularly from sub-national bodies 
such as state governments.  Members should also distinguish  between wilful defaulter s and those 
Members defaulting on their obligations as a consequence of  inherent constraints, such as the 
capacity constraints faced by developing and least developed countries.  Despite a willingness to try 
to notify on time, and to fulfil the ir WTO obligation s, developing countries suffer ed from constraints 
in resource s and expertise.  India noted that sometimes also interpretation issues cause d delay s in 
notification s. 
7.66.   The revised US proposal ha d been sent to Capital for review  and his delegation would revert 
back to the US with its comments at a later stage . In the meantime, he wished already to provide 
some interim comments regarding the administrative actions proposed by the US as a way to address 
the issue of Members' non -compliance w ith their notification obligations. No Member c ould claim 
that it had complied with its notification obligations fully; this was evident from Members' statements 
in various WTO  bodies, as well as in WTO  dispute claims. Nevertheless, many  Members did succeed 
in notify ing various measures , even if  the range and quality of the content contained in those 
notifications varied. However, to  redress such imbalances and  failings , the US had proposed 
measures that risked, rather , to flood committees with interpretational issues over notification 
requirements , such as coverage and content , which would serve only to create additional burden s 
on the existing system and its resources . G/C/M/131  
 
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  7.67.   The WTO  Secretariat ha d been help ful in compiling Members' notifications , and had regularly 
monitor ed Members' notification compliance for consideration by the respective committees, where 
Members enjoyed  an opportunity to  raise questions.  However, any further burden placed on the 
Secretariat for further work on notification s would  only divert the Secretariat's attention away from 
the more useful regular and mainstream work.  In India's view, Members should explore first those  
avenues  already available , such as cross -notification, and discussion in committees, rather than 
introducing further discipline s that would only increase t he burden on those Member s already in 
genuine difficulty, and penalize the non -wilful defaulters.  Members should discuss other available 
options  to improve the situation, if any, in approaches that were based on cooperation and 
collaboration.  
7.68.   The delegate of the United States  said that they had heard many comments and concerns 
expressed regarding the proposed administrative measures  but had not yet heard a ny satisfactory 
reasoning to explain  why there should  not be real consequences in cases of  chronic failure to meet 
notification obligations.  Was it credible for there to be no consequences whatsoever for failure to 
respect such basic obligations? Her delegation was open to further discussion with Members on the 
topic of how to craft administrat ive measures in the most effective way, bearing in mind that the US 
remained convinced by the principle that chronic disregard of notification obligations should have 
consequences , and that this principle  should not be abandoned . The US welcome d additional 
thoughts on how to improve compliance  and would also be interested to hear of any specific ideas 
that Members may have on possible positive incentives , as mentioned by several Members . 
7.69.   The US would revert back to those questions raised on the s cope of the proposal , as well as 
on including the TFA, both in bilateral discussions with Members and at the CTG 's next meeting. 
Members' engagement and feedback had been extremely useful and her delegation welcome d 
further  discussion.  
7.70.   The Chairperson  thanked delegations for their interventions and indicated that , taking stock 
of what had been said under th is agenda item, and also under agenda item  2 on the status of 
notifications, it appeared that there was agreement among the WTO  Membership that transparency 
was indeed very important to the work of the WTO.  However, it was also clear that views differed 
as to how best to address the issue of enhancing transparency and improving Members' performance 
with their notification obligat ions. He ther efore proposed that the Council take note of the statements 
made.  
7.71.   The Council so agreed . 
8  INDIA – QUANTITATIVE  RESTRICTION ON IMPO RTS OF BEANS OF THE SPECIES VIGNA 
MUNGO HEPPER OR VIGN A RADIATA WILCZEK – REQUEST FROM AUSTRAL IA 
8.1.  The Chairperson  informed the C ouncil that , in a communication dated 9  March  2018, the 
delegation of Australia had requested the Secretariat to include this item  on the agenda.  
8.2.  The delegate of Australia  expressed his authorities' ongoing frustration and disappointment at 
India's unwilli ngness to engage on the issue of the WTO basis of its quantitative restriction placed , 
in August  2017, on imports of beans of the species Vigna Mungo Hepper or Vigna Radiata Wilczek, 
commonly known as mung beans. The general prohibition on the use of quant itative restrictions was 
one of the core disciplines of the GATT and the WTO  Agreement on Agriculture  (AoA) . Australia had 
repeatedly sought a response from India at the  Committee on Agriculture (COA)  meetings of 
October  2017 and February  2018, and at th is Council for Trade in Goods on 10  November  2017. 
India on each occasion had responded that it would submit the notification and relevant information 
to the appropriate WTO  Committee in due course  but then failed in fact to do so. Further attempts 
by Aust ralia and other WTO  Members with an interest in mung bean exports to receive answers to 
their questions had resulted only in responses  that Australia considered to be inadequate . Questions 
in writing to India  from Australia's Department of Agriculture and Water Resources , in 
September  2017, as well as bilateral and plurilateral meetings in Geneva and New Delhi had likewise 
been unsuccessful. India's lack of engagement and inadequate responses to Australia's requests for 
further information on the WTO -basis of the restrictions was a source of concern  to Australia . 
Australia looked forward to India adopting an appropriate level of engagement with WTO  Members 
on this issue.  G/C/M/131  
 
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  8.3.  The delegate of Ukraine  echoed Australia's systemic concerns on this issue . Transparency  and 
predictability in Members' trade policies were the elements necessary to providing certainty when 
delivering cargo ; such clarity was an indispensable condition in facilitating trade.  
8.4.  The delegate of the United States  echoed the concerns raised by Aust ralia regarding India's 
quantitative restrictions on imports of select varieties of beans. At the February meeting of the  COA, 
the US had asked India to provide clarification concerning its quantitative restrictions (QRs), 
including with regard to time -frames and any plans that India m ight have to institute additional QRs 
on agricultural imports. The US had also asked India to explain how such quantitative restrictions 
were consistent with India's WTO  commitments , although to date no response had been recei ved 
from India . The US would appreciate receiving not only India's responses , but also any update that 
India might be able already to provide during the meeting. The US also remained concerned by 
India's attempts to limit imports of other pulses through the sudden raising of tariffs , on 
three  occasions in recent months , and without any advance notification, including , and in particular , 
for shipments that were already en rou te. 
8.5.  The delegate of the European Union  said that the EU shared the preoccupations raised by 
Australia and other Members , and reiterated its concerns about the effect of the measures on trade. 
The issue had been raised on several occasions, at the last CTG , and in the C OA, but no substantial 
response had so far been received from India. Her delegation emphasized the importance of 
WTO Members respect ing their transparency obligations and notify ing to the WTO the introduction 
of any quantitative import restriction , export restriction , or export ban. The measure was part of a 
number of restr ictive, protectionist measures , taken and announced by India,  concerning pulses , in 
addition to a tariff increase and market price support. These measures had a negative impact on 
producers and exporters of pulses from the EU , and also from many developing  countries.  
8.6.  The delegate of New Zealand  reiterated New Zealand's systemic interest in this matter and , in 
line with what had been said under the agenda 's previous  item, encouraged transparency , and 
highlighted the importance of maintaining transparency , in relation to those WTO  obligations that 
Members had undertaken.  
8.7.  The delegate of the Russian Federation  expressed systemic interest in the issue of the 
application of QRs to agricultural imports.  
8.8.  The delegate of Canada  echoed the concerns raised by Australi a and others  regard ing India's 
QRs on "mung beans" and "black beans". Q Rs had also been placed on pigeon peas. He asked  for 
clarification from India with regard to the basis for its imposition of  such QRs, the committee to 
which India would notify its QRs , and the timing of that notification . He also asked India if it had 
applied or if it intended to apply similar restrictions to any other pulses or agricultural commodities . 
Canada looked forward to receiving India's responses to these questions. He emphasi zed the 
importance of receiving advance notice of changes to these types of measures so as also to minimize 
avoidable disruption to traders.  
8.9.  The delegate of Brazil  expressed interest in following this discussion and in hearing India's 
clarification of the concerns raised by other Members.  
8.10.   The delegate of Japan  expressed Japan's systemic interest in the discussion  of this issue, 
which Japan would monitor closely . 
8.11.   The delegate of India appreciat ed the interest shown by previous speakers in India's import 
measures on the stated agricultural product. Since the last  CTG meeting , India had been interacting 
on this issue with Members in the COA and had informed them that it would shortly be notifying the 
measure as a QR. Although Capital was stil l collecting the information, he addressed certain aspects 
of the QRs and questions raised by Members , and indicated that, as part of its biannual notification 
on QRs, India was in the process of consolidating the QR -related information in accordance with the 
prescribed WTO  format , and would shortly submit  to the CMA the consolidated QR  notification. 
Regarding the duration , he indicated that these measure s were temporary measures , as permitted 
under WTO rules. The restriction on pulses had been imposed thro ugh Notification s No. 19 and 22 
of 5 and 21  August  2017, respectively, and all the declarations  made prior to the notification dates 
had been cleared by Customs  in accordance with paragraphs  2.17 and 9.11 of the "Foreign Trade 
Policy Handbook of Procedures of the Government of India" . In addition, those declarations , G/C/M/131  
 
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  supported by a confirmed irrevocable letter of credit , had been authorized for imports as from the 
applica bility of the notification , and clear ed by India's customs authorities. Additional comments on 
this issue should be addressed  in writing to his delegation.  
8.12.   The Chairperson  proposed that the Council take note of the statements made.  
8.13.   The Council so agreed . 
9  UNITED STATES – SECT ION 232 INVESTIGATIONS A ND MEASURES ON IMPORT S OF 
STEEL AND ALUMINIUM – REQUEST FROM CHINA  AND THE RUSSIAN FED ERATION  
9.1.  The Chairperson  informed the Council that , in communications dated 9 and 12  March  2018, 
the delegations of the Russian Federation and China, respectively, had requested the Secretariat to 
include this issue on the agenda . 
9.2.  The delegate of China  expressed China's grave concern  over, and strong opposition to , the 
US Section  232 investigation on imported steel and aluminium on which tariffs had been imposed as 
from the date of this meeting. China would take all measures necessary to safeguard its legitimate 
rights and interest s. China's concerns referred to the factual evidence, the rules basis, and the 
international ramifications of the US  measures . 
9.3.  On the factual e vidence , and a fter examination , China believe d that the results of the 
investigation were not based on solid evidence ; indeed, d uring the investigation , many Members, 
including China, ha d submitted evidence to the US  government  demonstrat ing that export s of steel 
and alumin ium products d id not threaten US  national security. However, th ose submissions had not 
been even-handedly discussed in the 232  investigation reports.  In terms of volume , the 
US Department of Defence  had estimate d that US  military requir ements for steel represent ed only 
3% of US  steel production. In other words, US  domestic production capacity for steel was roughly 
32 times that of US national defence  needs. Considering the number of major suppliers that had 
been temporar ily exempted  from the measure , whose exports should be counted as reliable for 
national security purposes,  and that this exemption was likely to be further extended, the ratio of 
supply to demand for national security purposes was even larger . There  was no evidence that such 
suppl ies were insufficient to meet the  needs of  US national defen ce; and this render ed the tariff 
groundless. In terms of product coverage, when compared with the 2001 Section  232 steel 
investigation , where no actions were taken, product coverage  on this occasion was much wider. 
However, there was no breakdown analysis based on product types in t he investigation report ; 
therefore , questions remain ed as to the need for such broad product coverage. In terms of industrial 
indicators, such as price, capaci ty utilization rate , and sectoral employment, it was clear from the 
report that there had been  no noticeable decline in trend since 2010. As to the declining number of 
blast oxygen furnace s, which was  discussed in the report, this was  neither  the result of  a steady 
drop in steel consumption , nor the result of an increase in imports , or globalization ; rather , it was  a 
direct result of the introduction of a new production technology  called  the 'minimill '. According to a 
paper published in 2015 in the American  Economic Review  journal , entitled "Reallocation and 
Technology: Evidence from the US  Steel Industry ", the minimill plants were significantly more 
productive than traditional steel plants . This productivity premium introduced  a reallocation process 
whereby  minimills displaced older technology known as vertically integrated production. China 
believe d that a thorough and even -handed analysis should have given at least minimum 
consideration to these facts before reach ing a final conclusion.  
9.4.  On the rules aspect , and as noted by other Members on previous occasions, China considered 
that the US  measure violated multiple WTO  rules, including its unilateral character and a lack of  
transparency  in many aspects , including : in the investigation , in the process and conditions for 
country exemptions , and regarding the time -period during which these measures would apply . There 
were also multiple possible violations of relevant WTO and GATT  rules, including Article  I of the GATT 
and relevant provisions of the S CM Agreem ent. The impact on WTO rules was dangerous, not only 
in terms of commercial interest but also to the whole WTO system itself, as pointed out by The 
Economist when it indicated that the WTO was "in grave danger".  
9.5.  In terms of  the international ramifications  of this investigation , governments, industries, 
media, academia , and think-tanks around the world had all expressed their concern s over, and 
disagreement with , these US measures. In an online survey conducted by Chicago University, over G/C/M/131  
 
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  40 economists had e xpressed their disagreement with the se measure s. A 2016 Nobel Laureate , 
economist Oliver Hart , wrote that, "A robust result is that free trade increases national income. The 
cases where this is not true are rare and hard to spot." And a 2017 Nobel Laureate , economist 
Richard Thaler , wrote that, "In net we want more trade not less. This is unlikely to help and runs 
the risk of starting a trade war. S ad." 
9.6.  Regarding the history of Section  232 investigations ，and as described by multiple experts, 
China noted tha t the clearest  lesson from history was that extreme caution was needed to avoid 
misuse for political purposes, because such investigations risked not only to backfire  but also to 
result in a chain reaction and a vicious circle of tit -for-tat. The GATT and WTO had been built on the 
belief that trade led to peace, and that trade rules defused tensions. Experience from the 1930s 
taught  us that  nations that erected trade barriers achieved just the opposite of national security; in 
contrast, 2008 taught us that maintaining an open trading system and taking collective action 
enhance d stability, security, and development. In this spirit, China hoped that all Members, including 
the U S, would refrain from adopting unilateral measures, would follow WTO  rules, and woul d seek 
to address their trade concerns by recourse to the existing WTO  framework safeguard ing normal 
international trade flows , thereby  uphold ing the rules -based MTS. 
9.7.  The delegate of the Russian Federation  recalled that this was the third time that the Russian 
Federation had raised the issue of the US  Section  232 investigations and measures in this Council . 
Regrettably , Russia's worst expectations had materialized , and the US  attitude towards the 
fundamental principles of fair and rules -based t rade was disturbing . 
9.8.  The 25% duties on steel and 10% duties on aluminium obviously exceeded US bound levels. 
For Russian exporters , this meant a sudden limit on exports worth US$3.2 billion. In addition , the 
selective treatment of different suppliers w ent beyond any reasonable understanding of the 
MFN principle . According to publicly available information, imports from at least eight  WTO Members 
would be exempted from duties. It was difficult to understand US motives and goals  for such 
differentiation. T herefore, Russia r equested the US  to clarify the following: (i) if the measures were 
really intended to revitalize  the US  steel and aluminium sectors, why would the US exempt the 
majority of imports into its market? (ii) what criteria were applied for exempt ing certain countries 
from duties? (iii) did the US intend to adjust the final tariff levels applied to the rest of the world 
once exemptions had been agreed for certain countries? (iv) Russia's understanding was that the 
rationale behind these duties was excess capacity in the US  steel and aluminium sectors. If so, why 
were the measures imposed on countries with historically stable volumes of capacity and foreign 
trade in steel and aluminium? and (v)  what kind of positive effects did the US expect in terms  of 
such elimination of excess capacity? Russia anticipated only a "domino effect" and a rise in 
protectionism also in other markets.  
9.9.  Despite Russia's  numerous requests  for it to do so , the US had failed to engage in multilateral 
and bilateral substantive discussion s on the issue of ongoing investigations  and d uties already i n 
place. His delegation had expected that the US would explain if, and how , the measures could be 
justified under WTO  law; but Russia had not to date seen any  such justification. On this issue, and 
as China had just summarized, much had been said at the General Council and other fora on 
US responsibility with regard to the implications of these measures for the MTS, which  reflected the 
WTO Membership's common understanding . Russia looked forward to engaging in a constructive 
dialogue with the US on th is matter.  
9.10.   The representative  of the European Union  recalled that the EU had previously expressed, 
notably at the previous General Council meeting , its concerns over the US  measures  in question,  
which took effect as of 23 March  2018, the date of this meeting . His delegation did not believe that 
these measures  could be justified on the basis of national security considerations, and that 
attempting to do so risked undermining the MTS. In simple terms , the WTO  national security 
exception did not allow import restrictions for the purpose s of keeping a domestic industry alive and 
prosperous. The E U and its member States were deeply  concerned by the direct and indirect impact 
that the announce d measures could have on the US  market, on the EU market, and on third  country 
markets. The measures also raised  significant systemic concerns.  
9.11.   The E U acknowledged that EU exports of steel and aluminium would now be temporarily 
excluded from these  measures  until 1  May 2018 (40 days). Nevertheless , it was fully determined to 
protect its commercial interests in a WTO -compatible manner. The  EU approach would balance the G/C/M/131  
 
- 24 - 
 
  need for a proportionate and legally sound response, while at the same time leaving room fo r 
possible dialogue and an eventual solution. The EU reserved all its rights available under the 
WTO Agreements.  
9.12.   The US measures also distracted from the important challenge of addressing the root causes 
of problems in today's steel and aluminium sectors, namely  the reality of global overcapacity caused 
by non -market based production. Tackling those problems required joint efforts in all relevant fora, 
working with the key countries involved. The EU had engaged actively with the US and other partners 
to this end  and considered that s ector-wide protection in the US was an inappropriate remedy for 
the real problems of global overcapacity in those two  sectors.  
9.13.   The delegate of Japan  shared the concerns e xpressed by other Members. It was regrettable 
that the US had put in place the se trade-restrictive measures on steel and aluminium products. 
Japan was deeply concerned about their consistency with the WTO  Agreement , and emphasized that 
unilateral measures posed a serious threat to the M TS and the global economy. His delegation was 
concern ed that the measures in question could trigger a spiral of counter -measures. In that regard, 
Japan itself would take appropriate and necessary action, taking into considera tion how the situation 
develop ed. 
9.14.   The delegate of the Bolivarian Republic of Venezuela  aligned his delegation with the deeply 
felt concern s expressed by China and Russia, particularly over the application by the US of unilateral 
measures that affected the economic and trade interests of other countries. Those measures would 
affect international trade in its entirety and would have serious consequences for the MTS. Among 
those consequences , as mentioned by various delegations at previous meetings, would be an 
unprecedented trade war.  
9.15.   The delegate of Brazil  thanked China and the Russian Federation for including this item on 
the agenda. Brazil believed that the global challenge of steel excess capacity affecting Members 
could only be addressed multilaterally and in an appropriate fora for doing so , such as the G20's 
Global Forum on Steel Excess Capacity. Furthermore, in the WTO  Framework, there were appropriate 
instruments, rules, and procedures to address  unfair trade practices. From the beginning of the 
Section  232 investigation, Brazil had contacted the US  Government on several occasions to argue 
that Brazilian exports should be exempt from  the restrictions. Brazil remained concerned about the 
systemic impact of the measure, and of the consequences of an elastic interpretation of 
GATT  Article  XXI in particular . However, Brazil was encouraged by recent statements that kept open 
the possibility of continuing to explore a  bilateral track with a view to resolving this issue, and hoped 
that a solution would eventually be found through dialogue. In Brazil's view, the collective priority 
should be to avoid any systemic consequences  of the US  measures , which would not then be in the 
interest s of any Member.  
9.16.   The delegate of New Zealand  reiterat ed New Zealand's  strong support for the WTO  rules-
based MTS and highlighted the benefits of clear and agreed global rules for trade so as to support 
economic growth and development. His authorities supported the reduction of trade barriers and the 
liberali zation of markets  but recognized Members'  rights to take legitimate WTO -consistent actions 
to protect their interests. New Zealand encouraged all WTO  Members to work within WTO rules and 
to resolve trade disputes through the DSU. 
9.17.   The delegate of Turkey  expressed his country's deep concern over extra US duties on steel 
and aluminium imports. Apart from the detrimental effect that these would have  on global trade, 
the impos ition of  unilateral tariffs  ran contrary to the MFN principle  and could not be just ified by 
claim s of national security. Under WTO  rules, Members already had recourse to several legitimate 
tools to challenge unfair trade practices. All these tools urged Members to initiate and address 
investigations in a transparent and fair manner , and to adopt any necessary measures in compliance 
with WTO  law. Furthermore, the US had already imposed 164  anti-dumping and countervailing 
duties against steel products from all over the world, with 20 additional cases still under 
investigation. Turkey reques ted the US to explain how its  measures complied with WTO  obligations. 
Turkey would continue its dialogue and consultation with the US  but reserved all its rights under  the 
WTO rules and agreements.  
9.18.   The delegate of  the Republic of Korea  shared the concerns of previous speakers regarding 
GATT  Article  XXI. Korea considered that the concept of "National Security" must be interpreted in a G/C/M/131  
 
- 25 - 
 
  very limited and strict manner , not only to prevent an unnecessary chain reaction of similar arbitrary 
measures by other Memb ers but also to allow the WTO  to continue functioning as a M TS. 
9.19.   The delegate of Hong Kong, China  also shared the concerns of previous speakers over the 
unilateral trade-restrictive measures announced by the US further to its Section  232 investigations. 
Hong Kong, China had only a very modest volume of exports  of aluminium and steel products to the 
US, which in no way threatened US  national security or the viability of the US  domestic industry . 
The measures imposed on exports from Hong Kong, China were therefore unreasonable and 
unjustified. Moreover, Hong Kong, China was concerned by the systemic implications of these 
measures  and believed that such protectionism could trigger a domino effect; once triggered, this 
domino effect would be difficult t o reverse. Any trade war that might follow w ould damag e the MTS 
and the global economy. As a free-trade practitioner and staunch supporter of the MTS, Hong Kong, 
China asked Members to honour their tariff commitments and observe WTO  rules. Hong Kong, China  
would monitor developments closely and take action as necessary.  
9.20.   The delegate of Singapore  expressed the deep concern of his delegation over the 
US measures , which would adversely affect global supply chains and global growth , and also cause 
downstream im pact on US  industries that depended on those imports. More broadly, such actions , 
without any accompanying consultations , undermined the rules -based MTS. Overnight developments 
were worrying to small economies like that of Singapore. All Members now needed  to exercise 
restraint and to avoid a further escalation in tensions. Any trade conflict would have a wide -ranging 
impact, hurting the global economy, global growth, and ultimately also workers and consumers. 
Specific to the US  Section  232 tariffs on steel and aluminium, Singapore held both commercial and 
systemic concerns. Its companies had expressed concern over the direct and knock -on effect of the 
measure on their exports , as well as over the uneven treatment granted to exports from different 
Members . Singapore would closely monitor any developments and continue to engage with the US 
on these issues with a view to addressing Singapore's systemic and economic concerns.  
9.21.   The delegate of Thailand  shared the concerns of previous speakers regarding the systemic 
impact of this  unilateral measure taken by the US, which would have a negative direct and indirect 
impact on global trade, and risk ed retaliation and trade war. He urged all Members to  implement 
their measures in compliance with WTO  rules and obligations  and reiterated Thailand's interest in 
this issue. 
9.22.   The delegate of Pakistan  shared the economic and systemic concerns of previous speakers 
regarding the US  unilateral measures. These measures could have serious consequences from a 
global perspective in general , and from a developing country viewpoint in particular. The US action 
had the potential to provoke full-scale protectionist retaliation from other WTO Members, which 
would not only lead to dire consequences for developing countries but also weaken the entire edifice 
of the global trading system. Pakistan urged all Members to continue to work towards multilateralism 
and trade openness , trade being  the only way for smaller econo mies to  flourish.  
9.23.   The delegate of Norway  expressed Norway's deep concern  over the restrictions on imports of 
steel and aluminium announced by the US  Department of Commerce further to its Section  232 
investigations. At more than 10%, steel and aluminium made up a significant share  of Norwegian 
goods exports. Their trade was likely to suffer from such measures , directly and indirectly, through 
further depressed prices, diverted trade, and any escalation and retaliation. However, Norway was 
primarily concerned about the risks of undermining the MTS. Any trade measure on steel, aluminium, 
or otherwise, should be WTO-consistent , and the WTO framework provided ample scope to adopt 
any justified measure in a legal and coherent manner. All WTO  Members should be mindful tha t 
there were certain buttons in the intricate machinery of the MTS that should not be pushed as to do 
so would entail a high risk for the system itself. Norway would continue to follow this issue closely 
and consider any appropriate steps.  
9.24.   The delegate of Australia  expressed concern over the potential  risk to  the global rules -based 
trading system posed by the US  measures and any reaction to them or counter -measures adopted 
in turn by other Members . Australia shared the concerns of others over the important challenges 
facing global steel and aluminium industries , and supported ongoing efforts to address this global 
issue cooperatively and in accordance with international trade rules.  G/C/M/131  
 
- 26 - 
 
  9.25.   The delegate of India joined others in expressing concern over the trade pol icy measures 
imposed by the US on steel and aluminium products. In India's view, this was an important systemic 
issue and a misuse of the security exceptions under the GATT ; unilateral measures had no place in 
the trade arena and Members needed to exercise  restraint and respect WTO  rules. Such measures 
should also not be applied with the objective of erecting trade barriers  that would be inconsistent 
with Members' WTO  commitments.  
9.26.   The delegate of El Salvador  thank ed China and Russia for having included th is issue on the 
agenda. El Salvador was deeply concerned over the use of such measure s by the US , and the possible 
consequence that  these measures might then trigger counter -measures from other Members, 
leading to a situation that would not benefit  any Member . These measures not only had trade 
implications , but also an impact on the MTS, which was a bastion to be preserved. El Salvador,  as a 
staunch believer in the benefits of the MTS, considered that the MTS should be preserved and 
strengthened thr ough Members' support of and compliance with WTO rules. The value and volume 
of exports from El Salvador to the US were not significant enough to generate  an impact on the 
US market ; nevertheless, El Salvador still maintained a commercial interest in the i mposition of the 
measures in question . Indeed , the impact on economies such as El Salvador's was potentially 
significant and the discriminatory nature of the measure was also of great concern , as previously 
indicated by other affected Members.  
9.27.   El Salvador would continue to follow development s in these ongoing investigations  closely , 
including  measures imposed by the US on steel and aluminium products, and other similar trade 
measures already announced. El Salvador urged the US  to uphold the principle of transparency with 
regard to these measures, correctly to adhere to its multilateral commitments , and to provide 
additional information concerning the investigations and measures it intended to apply to steel and 
aluminium products, as this was necessary to  allow for a proper evaluation of their impact on 
economies such as theirs , both  at national and regional level.  
9.28.   The delegate of Switzerland  echoed the concerns expressed by many other delegations over 
the US  unilateral measures entering into force that da y. Like many other Members, Switzerland 
would be affected by those tariffs , even if their exports to the US were relatively modest in volume 
and value and  made up  mostly  of high-quality niche products that US consumers might not otherwise 
be able to find. At the same time, Switzerland was aware that there was a serious problem of global 
over-capacity in the steel and aluminium sectors ; nevertheless , Switzerland was of the view that the 
issue needed to be addressed and resolved through dialogue, and in parti cular through dialogue 
among those Members primarily concerned. The OECD Global Forum on Steel Excess Capacity had 
been established precisely to address the over -capacity problem and Switzerland urged all of the 
main players to work constructively towards a solution within that framework , and to refrain from 
taking any unilateral measures.  
9.29.   The delegate of Paraguay  echoed the economic and systemic concerns expressed by other 
Members. Paraguay's concerns referred mainly to the collateral effects of the measures on 
third countries, especially on small economies . Paraguay called on the US to seek a WTO-compliant 
solution consistent with the values of the MTS, which included the promotion of peace , and urged 
the US to avoid unilateral solutions that risked leading to a n unprecede nted problem on a global 
scale.  
9.30.   The delegate of Guatemala  said that , as a steel producer, her country held an interest in this 
item and therefore wished to express its systemic concern. Guatemala would closely follow 
discussio ns on this issue . 
9.31.   The delegate of Kazakhstan  thanked the Russian Federation and China for including th is issue 
on the agenda , since Kazakhstan, like other Members, held systemic concerns over these measures 
and would closely monitor all development s. 
9.32.   The d elegate of the United States,  in response to Members' previous statements , provid ed 
additional information concerning the proclamations issued by the US President pursuant to 
Section  232 of the Trade Expansion Act of 1962, as amended, and consistent with the Decision 
Concerning Article  XXI of the General Agreement taken by the GATT  Council on 30  November  1982. 
In this vein , she indicated that , in January  2018, pursuant to Section  232 of the above -mentioned 
Act of 1962, the US  Secretary of C ommerce had delivered to the President the findings and G/C/M/131  
 
- 27 - 
 
  recommendations in investigations concerning the impact of steel and aluminium imports on 
US national security. The US  Department of Commerce had published public versions  of the reports 
on 16  Februar y 2018. 
9.33.   In the investigations, the Secretary had found that the quantities of imports and 
circumstances of global excess capacity for producing steel and aluminium "threatened to impair the 
national security" as defined in Section  232 and recommended actio ns to the President to adjust the 
imports of steel and aluminium articles so that such imports would not threaten to impair the national 
security. On 8  March  2018, the President issued proclamations concurring with the Secretary of 
Commerce's findings and imposing 25 and 10% ad valorem  tariffs on imports of steel and aluminium 
articles , respectively. The proclamations noted the President's determination that those tariffs were 
necessary to address the threat that imports of steel and aluminium articles pose d to national 
security. The additional tariffs would apply to goods entered into the US or withdrawn from 
warehouses for consumption on or after 23  March  2018. The President's proclamations authorized 
the Secretary of Commerce to provide relief from the ad ditional duties for steel or aluminium articles 
determined not to be produced in the US in sufficient and reasonably available amounts or of 
satisfactory quality, as well as on the basis of specific national security considerations. On 
19 March  2018, the D epartment of Commerce published the requirements and procedures for 
requesting such exclusions as well as for submitting exceptions to the granting of exclusion requests.  
9.34.   In adopting the additional tariffs, the President recognized that the US had importan t security 
relationships with some countries whose exports of steel and aluminium articles to the US were 
weakening the US'  internal economy , thereby threatening to impair US  national security. The 
President also recognized the shared concern over global excess capacity, a circumstance that was 
contributing to the threatened impairment of US  national security. The President's proclamations 
provided that any country with which the US had a security relationship was welcome to discuss 
with the US alternative  ways to address the threatened impairment of national security caused by 
imports from that country. Should the US and any such country arrive at a satisfactory alternative 
means to address the threat to national security, such that the President determine d that imports 
from that country no longer threatened to impair the national security, the President m ight remove 
or modify the additional tariffs set out in the proclamation. On 22  March  2018, the President had 
issued proclamations removing, for a period of time, the application of additional tariffs with regard 
to certain countries with which the US had a security relationship and with which the US was 
currently engaged in discussions on alternative means to address the threat posed to US  national 
securit y by steel  and aluminium article imports . 
9.35.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statements made.  
9.36.   The Council so agreed . 
10  INDONESIA'S IMPORT A ND EXPORT RESTRICTIN G POLICIES AND PRACT ICES – 
REQUEST FROM THE EUR OPEAN UNION, JAPAN, AND THE UNITED STATES  
10.1.   The Chairperson  informed the Committee that , in communications dated 12  March  2018, the 
delegations of the European Union, Japa n, and the United States , respectively, had requested the 
Secretariat to include this item on the agenda.  
10.2.   The delegate of the European Union  observed that this item had already been on the 
CTG's  agenda  for some time . Some efforts had been made to address c umbersome measures , 
including certain simplification of import procedures. However, there remained a high number of 
trade  restrictive measures in Indonesia, which were symptomatic of the protectionist nature of 
Indonesia's trade policy, including, for exam ple: use of local content requirements in telecoms, retail, 
energy construction, transport, and shipping of key commodities and public procurement; complex 
and burdensome import requirements for meat and dairy products, fresh plants, horticulture, wood 
and forestry products, and cosmetics (the latter actually further subjected to recently increased, 
very high registration fees); quantitative restrictions for meat, alcohol products, steel, and tyres; 
export restrictions for certain raw materials; burdensome and discriminatory conformity assessment 
procedures ; and a growing proliferation of mandatory technica l standards.  G/C/M/131  
 
- 28 - 
 
  10.3.   In particular , the EU request ed precise information on the state of play of the implem enting 
regulations of Halal Law  33/2014 , whose scope was extremely broad and would affect food and 
beverages, pharmaceuticals, and cosmetic and leather goods. If fully implemented, this law would 
bring trade in these articles to a halt. Reportedly, at least two  other governmental regulations were 
in preparation. Her delegation invited Indonesia to provide precise information on the scope, object , 
and timing of the measures under preparation and to notify them to the WTO in accordance with 
WTO rules. She called upon Indonesia to keep Halal certification and labelling voluntary, as a less 
trade restrictive measure , and requested a state of play of the rules and standards regulating the 
production of processed milk and relevant investments. The EU also requested Indonesia to update 
Members concerning Minist erial Decree  82/2017 , which appeared to impose the regulation that 
export and import of key commodities be carried  out and insured only by domestic companies. The 
EU urged Indonesia to eliminate its high number of trade barriers and to refrain from issuing  any 
new trade -restrictive measures , in line with its commitments in the G -20. 
10.4.   The delegate of Japan  said that , together with other co -sponsors, Japan continued to have 
strong concerns over such measures as Indonesia's LCR on 4G  mobile phones, as had been 
repeatedly stated at previous CTG and TRIM s meetings , although little progress had so far been 
made to assuage the se concerns. Japan again urged Indonesia to fully update Members on the series 
of measures that it had adopted, and to explain to Members its concrete actions in order to ensure 
their full compliance with the WTO Agreements. He reiterated his delegation's principal concerns, in 
particular in relation to the Mining Law. Japan understood that relaxation of the complete export 
prohibition of nickel  ore was valid for only five years, provided that certain conditions for attaining 
export permission had been fulfilled. Japan believed th is measure to be inconsistent with 
GATT  Article  XI and would monitor the situation closely . 
10.5.   The delegate of the United  States  noted that the CTG was fully aware of the breadth of 
US concerns over Indonesia's trade and investment regime. In previous CTG interventions, his 
delegation had reviewed in some detail its broad range of concerns , including localization 
requirement s, import licensing requirements, standards requirements, pre -shipment inspection 
requirements, and export restrictions, including taxes and prohibitions, among others. These types 
of restrictions affected a broad range of sectors. H er delegation had also expressed its concerns over 
Indonesia's general lack of transparency. Despite US  efforts to reduce the number of localization 
requirements, Indonesia had continued to put new requirements in place. At the CTG's previous 
meeting, h er delegation had referred to new local purchase requirements on dairy products. Now 
Indonesia was considering new requirements on soybeans . And the US had also learned of separate 
localization requirements for veterinary pharmaceuticals that could also restric t imports. The US was 
also concerned by developments in the digital trade space, including Indonesia's recent issuance of 
a regulation that established tariff lines for electronically transmitted software and digital goods. 
Concerns also existed over repor ts that Indonesia planned to raise its import duty rates on those 
particular tariff lines ; the US considered that such a move might contravene the moratorium on 
customs duties on electronic transmissions. US  efforts to date to work with the Indonesian 
government –both bilaterally and at the WTO –to address these concerns had produced disappointing 
results , with only limited exceptions. The US had displayed great patien ce in its work with Indonesia 
and hope d that the efforts in various WTO bodies , and also bilaterally, would soon result in free and 
fair trade between the US and Indonesia.  
10.6.   The delegate of New Zealand  echoed the concerns  of other Members . New Zealand believed 
that Indonesia's restrictions on agricultural imports undermined core WTO  principles and  were 
inconsistent with key obligations in the Agreement  on Agriculture . His authorities continued to have 
significant concerns over a number of import restrictions , which affected trade across a range of 
agricultural products. They were particularly concerned over the introduction of recent measures 
restricting  imports of dairy and horticultural products. New Zealand welcomed Indonesia's 
commitment to implement ing the recommendations of the Disp ute Settlement Body, in Indonesia – 
Import Licensing Regimes  (DS447/478 ), and was hopeful that the implementation process would 
result in meaningful long -term reform of Indonesia's restrictive import regime. Nor did Indonesia's 
restrictions only hurt expor ters, because Indonesian consumers, processors, and producers were 
also affected by rises in food prices, including basic foodstuffs and ingredients for the domestic 
manufacturing sector. New Zealand hoped that Indonesia's reform plans would be consistent with 
its WTO  obligations , and looked forward to working with Indonesia during the implementation 
process.  G/C/M/131  
 
- 29 - 
 
  10.7.   The delegate of Australia  share d the concerns of other WTO  Members over Indonesia's import -
restricting policies in recent years, particularly as they affected agricultural trade. Australia noted 
that Indonesia frequently amended its regulations on the importation of agricultural products, often 
without notification and, even when notified, provided only limited opportunity for consultation with 
trading partners. Notification and consultation were critical to the continuing effectiveness of the 
rules-based global trading system under the WTO. Consultation with trading partners also provided 
an opportunity for  a discussion of how new  trade measures could  be implemented in the most 
efficient possible way for all parties.  
10.8.   The delegate of Switzerland  also share d the concerns of other Members regarding Indonesia's 
restrictive trade measures, especially its new Regulation No.  26/2017 , on supply and distribution of 
milk products , with regard to which companies had no or only limited clarity as to its functioning. 
Current trade was already either interrupted or under threat of being interrupted. This demonstrated 
that the measure 's impac t on trade  had been critical . Therefore, Switzerland asked Indonesia to 
provide detailed information swiftly and to ensure full transparency regarding the new regulation 
and its implementation ; otherwise, there would be no confidence in Indonesia's new reg ime. 
Indonesia should also ensure that the new regulation and its implementation were fully compatible 
with WTO  law, and that local  content requirements were not applied in such a way that foreign 
exporters would be discriminated against and excluded from Indonesia's  market.  
10.9.   The delegate of Brazil  thanked the proponents for again including this item on the agenda. 
The issue had been under discussion at the CTG for a long time and Brazil had consistently expressed 
its concerns, together with other Members, r egarding Indonesia's trade -restrictive measures; in 
particular, those measures affecting Brazilian exports of poultry and beef. Brazil had initiated 
two dispute settlement procedures concerning the se issues, one of which, DS484 , had been the 
object of a pa nel report favourable to Brazil's main requests. His authorities were encouraged, at 
the same time, by the agreement on a reasonable period of time (RPT) , recently concluded between 
Brazil and Indonesia,  regarding the same DS484, which they expected would be fully implemented. 
Brazil would continue to work with Indonesia towards that objective.  
10.10.   The delegate of Canada  welcomed some of the recent progress made on improving 
Indonesia's business climate  although more work still needed to be done. Canada shared the 
concerns expressed by other Members over Indonesia's ongoing import -restricting policies and 
practices. Canada was particularly concerned over the restrictions in the mining and oil and gas 
sectors, the increasing  number of  local content requirements across many sectors, including the 
renewable energy  sector , the uncertainties surrounding halal certification requirements , and also 
the import licensing requirements for horticultural products. Canada encourage d Indonesia to 
respect its WTO  obligations and to take steps promptly to address Members' concerns.  
10.11.   The delegate of the Republic of Korea  shared the concerns expressed by previous speakers. 
Korea was concerned about the pre -paid corporate income tax on importers and the va gue and 
broad nature of the industry law and the trade law of Indonesia. His authorities encouraged 
Indonesia to formulate its regulations in line with WTO  rules and to update  Members in a timely 
manner  on progress made . They would closely follow developme nts in  Indonesia's commitment s. 
10.12.   The delegate of Thailand  shared other Members' concerns regarding Indonesia's import -
restricting  measures, especially Indonesia's import licensing and quantitative restrictions on 
agricultural products. Thailand's agricultur e export s had already felt the impact of those trade -
restrictive measures and his authorities encouraged Indonesia to bring all of its measures into full 
compliance with WTO  rules. They would continue to monitor the issue closely.  
10.13.   The delegate of Chinese T aipei reiterated the concerns of her authorities over Indonesia's 
import and export restricting policies and practices. Despite the efforts made by Indonesia to 
improve their business environment, the number of restrictive trade measures that it applied ha d 
not yet decreased. Chinese Taipei shared the concern s of other Members  regarding a series of laws 
and regulations introduced by Indonesia, particularly a Law on Trade and Industry, restriction s in 
the retail sector, and local content requirements on 4G  mobile phones. These measures could 
adversely affect trade. Her delegation urged Indonesia to ensure that its measures were in full 
compliance with its WTO  obligations.  G/C/M/131  
 
- 30 - 
 
  10.14.   The delegate of Indonesia  said that her delegation had taken note of Members' concerns 
regarding some of Indonesia's  trade policies or measures, which were alleged to be restrictive in 
nature. Indonesia' s trade policies on the  whole corresponded well to its commitment to the WTO, 
which naturally championed the free flow of trade in goods acr oss, and within, its borders. The 
measures that  certain Members may have perceived as restrictive in nature may well have been a 
consequence of Indonesia's efforts to cope with certain outstanding problems or negative impacts 
that they were confronting in relation to their openness to international trade. She reminded 
delegations that these outstanding problems were  as follows : (i) more and more imported goods 
had been flooding the Indonesian market whose standards and quality were found to be below 
Indones ian standards; ( ii) the loss of livelihood of most Indonesians working in productive sectors; 
and ( iii) irresponsible and destructive exploitation of Indonesian resources. Indonesia understood 
that WTO  law provided for flexibilities or exceptions in order to offset such problems. In conclusion, 
Indonesia stood ready to discuss any of these concerns with Members bilaterally with a view to 
finding solutions that would benefit all  parties concerned . 
10.15.   The Chairperson  thanked delegations  for their interventions and proposed that the Council 
take note of the statements made.  
10.16.   The Council so agreed . 
11  INDIA – CUSTOMS DUTI ES ON ICT PRODUCTS – REQUEST FROM CANADA , CHINA, THE 
EUROPEAN UNION, JAPA N, NORWAY, CHINESE T AIPEI, AND THE UNITED STATES  
11.1.   The Chairperson  informed the Council that, in communications dated 12  March  2018, the 
delegations of Canada, China, the European Union, Japan, Norway, Chinese Taipei, and the United 
States,  respectively , had requested the Secretariat to include this item on the agenda.  
11.2.   The delegate of Canada  said that his delegation was deeply disappointed that , despite the 
concerns raised by WTO  Members at the CTG , as well as at the Market Access and ITA Committees, 
India continued to further increase its customs duties on ICT  products well beyond its WTO bound 
duties . Indeed, a s part of its 2018 -2019 budget , India had further increased customs duties on 
several ICT  products for which India's bound commitment was a zero rate of duty. The application 
of customs duties above boun d commitments on a broader range of ICT  products remained 
inconsistent with India's WTO  commitments and ran contrary to the objectives of multilateral tariff 
liberalization. Canada retained both systemic and commercial concerns with regard to India's 
decision to introduce these customs duties on ICT  products in excess of their bound commitments, 
and had not yet received any meaningful responses to the concerns raised by Canada in this area in 
any of the various WTO  bodies. His delegation did not accept India's justification provided thus far 
for applying customs duties above the bound commitments and once again called up on India to 
immediately bring itself into conformity with the commitments set out in its Schedule of Concessions 
and to refrain from pursuin g any further customs duty increases above those commitments. The 
ICT sector was just one  example from a  wide range of products affected by India's recent customs 
duty increases that negatively affected Canada's export interests. In addition to ICT  products, 
Canadian exports of pulses were also being significantly affected by recent tariff increases.  
11.3.   The del egate of the European Union  expressed concern over the recent announcement , in 
India's Union Budget for Financial Year 2018 -2019, of increased customs duties in such key sectors 
as ICT  products, cars, and car parts. The European industry, including compani es that had invested 
in India, was deeply  concerned about India's move towards import substitution. Her authorities 
understood that the increased duties formed  part of the 'Make in India' initiative ; nevertheless, such 
an initiative should not have a prote ctionist impact and raise concerns over India's commitment to 
ensuring a predictable trade and investment environment in full respect of WTO  rules. Regarding 
ICT goods, the new duty hikes were even more regrettable given that the announcement followed 
upon the imposition of duties on several telecom products already in July  2014, and the introduction 
and further increase of duties on a wide range of ICT  products in June, July, and December  2017.  
11.4.   On several occasions, in bilateral and multilateral meetings, the EU had already raised the 
issue of basic customs duties on products which the EU considered to be bound at zero in India's 
GATT  schedules, and which were covered by ITA -1, to which India was a Party. Her delegation 
disagreed with India's claim that the  products were not covered by ITA -1 concessions. The general 
principles of interpretation flowing from WTO  jurisprudence had to be taken into account. The panel G/C/M/131  
 
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  in EC-IT products , for example,  had concluded that a wide range of characteristics and technolo gies 
were covered by the scope of ITA -1 concessions, including some that had not existed when ITA -1 
had been concluded. In 2017 and 2018 , the EU  Ambassador in India had sent letters on th is issue, 
on three  occasions, to the Minister of Communications, the Electronics and IT  Secretary, and the 
Revenue Secretary , but had not received any response . The re -introduction and increase in import 
duties contradicted the desired perception of India as an open, non -protectionist economy, a s well 
as India's efforts to attract more foreign direct investment. They not only had a negative impact 
upon European and other foreign companies, but also led to higher prices for Indian consumers and 
thus hamper ed the development of "Digital India". The EU  called  upon India to reconsider these duty 
impositions or increases which , in the case of ICT  products , contradicted India's WTO  commitments.  
11.5.   The delegate of Japan , together with other co -sponsors, continue d to express its concern over 
the issues around India's customs duties on ICT  products. Indeed, it was highly regrettable that the 
government of India had increased the tariff s applied to a broad range of products in December  2017 
and February  2018. In particular, mobile phones were subject to 20%  customs dutie s as a 
consequence of a series of duty increases made by Notification s No. 56/2017 , No. 91/2017, and the 
Finance Bill  2018, and this  tariff rate of 20% was clearly inconsistent with India's binding 
commitment at zero. Moreover, in the Finance Bill  2018, th e government of India had repealed the 
Education Cess and Secondary and Higher Education Cess on imported goods, and had instead put 
in place a "Social Welfare Surcharge" at a rate of 10% of the aggregate customs duties on imported 
goods. This surcharge wa s inconsistent with India's binding commitment s. Japan held commercial 
concerns with regard to this series of duty increases, which had resulted in a burden of increased 
costs for Japanese companies as well as an adverse impact on the business environment in India. 
Japan urged India to immediately reinstate zero  duties o n the ICT  products in question.  
11.6.   The delegate of the United States  regretted to raise  this issue to the CTG level for the 
fifth time. But rather than responding to Members' concerns, India had continued along the same 
troubling path. Since h er delegation had last raised this issue at the CTG, India had increased tariffs 
still further, and on even more ICT  products ; this had occurred  on 1 July 2017, just one  day after 
the Goods Council 's summ er meeting of that year. India then went on to introduce  two subsequent 
rounds of tariff increases in the span of 60  days: on 14 December  2017, and then again on 
1 February  2018, as part of India's 2018/19 budget proposal. With regard to tariff increases o n 
ICT products, in July  2017, through  Customs Notification  56/2017, India had imposed new customs 
duties on imports of several essential information technology products , including cell phones, base 
stations, and printer ink cartridges, in addition to the d uties imposed on other telecommunications 
equipment pursuant to Customs Notification  11/2014. On 14 December  2017, India had issued 
Customs Notification  91/2017 , which had further increased tariffs on cell phones, from 10% to 
15% duty. The notification had also increased duties on a range of other ICT  products, such as video 
cameras. Not even 60  days later, India's proposed 2018/19  budget had outline d further tariff 
increases on certain ICT  products, including increases to 20% for smar t watches and weara ble 
devices.  
11.7.   The latest notifications, as well as the budget proposal, included product categories for which 
India had a WTO  binding obligation to provide duty -free treatment , namely , tariff 
subheading  8517.12 –cell phones –where India had a zero bound duty . The products under that 
subheading had entered the Indian market duty -free on 30  June 2017. However, as from 
1 July 2017, the tariff had been increased to 10%, and then to 15% on 14 December  2017. On 
1 February  2018, as part of the 2018  budget proposal, c ell phones were identified for an increase to 
20%. This was yet another example of India's apparent inconsistencies with its WTO  tariff 
commitments, and highlighted the  growing nature of the problem.  
11.8.   Another concern was that India's actions lacked transparency and created uncertainty for US 
and global companies. It was nearly impossible for traders to verify India's recent tariff increases 
because its official tariff schedule published on the website of India's Central Board of Excise and 
Customs wa s not updated on a regular basis. Any business looking for information on India's tariff 
on mobile phones ( HS8517.12) or base stations (HS8517.61), for example, would have no way of 
knowing that India levied a duty of 10% pursuant to Customs Notification  2017/58 for base stations 
or a duty of 15% for cell phones pursuant t o Customs Notification  2017/91.  
11.9.   To avoid further uncertainty for exporters, the US asked India to clarify as soon as possible 
the scope of Customs Notification  22/2018  because it  was currently unclear how that notification 
affected increases outlined in the budget as well as how it related to Customs Notifications  56 and G/C/M/131  
 
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  57/2017. The resulting effect of the lack of transparency had been described by several 
US companies that had indicated t hat, for certain products, they were required to refer to multiple 
customs notifications issued over the course of a decade in order to determine the effective tariff 
rate. These were large multinational companies that were struggling to understand India's effective 
tariff rate; imagine, therefore , how much more difficult it must be for micro, small, or medium -sized 
enterprises to do so. To conclude, the US again urged India to revoke Customs 
Notifications  11/2014, 56/2017, and 91/2017 , and to reinstate duty -free access as India had 
committed to do in its WTO  schedule. The  US also requested India to provide assurance s that it 
would not further raise customs duties in its 2018  Budget Proposal on products on which it had made 
a WTO  commitment  to provide duty -free access to its market , to update the official tariff schedule 
published on India's  Customs website , and to notify its current MFN  applied sch edule to the 
WTO without delay.  
11.10.   The delegate of Norway  said that the issue was a WTO  trade con cern at the most basic level. 
A Members' applied tariffs could not exceed those listed in their schedules. Technological 
advancement within a product segment clearly did not change that simple fact. This was a basic and 
self-evident starting point for how WTO Agreements must be read and how WTO  obligations must 
be understood. An interpretation implying that the product segment could automatically be released 
from binding commitments after technological advancement would seriously undermine the system. 
Thus,  Norway had both an economic and a systemic interest in this issue. It was fundamental that 
all Members abide by the ir WTO obligations. Norway looked forward to receiving further clarific ation 
from India on this issue.  
11.11.   The delegate of China  noted that , in February  2018, India had raised its applied tariff on 
many products, including cell phones and their parts. His delegation believed that this move was in 
violation of the ITA  Agreement and GATT  Article  ІІ, in particular regarding tariff lines  HS8517.12, 
"Telephones for cellular networks or for other wireless networks" and HS8517.70, "Parts" for cell 
phones. China  had taken note of India's explanation given at previous CTG meetings  that some of 
these products were not ITA  products but that India had ma de some classification parallels in its 
schedule. However, China's customs experts believed that the products at issue were indeed covered 
by the ITA. The ITA  Agreement had been concluded using HS  1996, and under that HS  nomenclature 
cell phone s did not ha ve an independent tariff line. Instead, they  belonged under HS8525 .20, the 
description of which was "transmission operators incorporating reception apparatus". Given 
technological advance s, in the transposition of HS96 to HS2002, cell phone s had been split  from 
that tariff line and moved into HS851712. Even if the tariff line had moved , the obligation remained , 
as the European Commission had already mentioned in the jurisprudence set out in the panel report  
of DS375 . China considered that, regardless of whe re a tariff line was classified, an ITA  product 
should be granted duty -free treatment. China requested India to contact again its Capital and to 
check promptly with India's customs experts the question of whether these lines did indeed belong 
within the scope of the ITA , and then to reinstate duty -free tr eatment for those tariff lines  
accordingly . 
11.12.   The delegate of Chinese Taipei  stated that , as a co-sponsor of th is issue, Chinese Taipei 
echoed the concerns  raised by previous speakers . Chin ese Ta ipei was particularly disturbed to learn 
that India had further increased its import duties on seven  products  only in December of the previous 
year, including on mobile phones, digital cameras, and micro wave ovens, under its Customs 
Notification  91/2017 , and that in February  of the current year , India had even proposed an increase 
on customs duty on certain ICT  products. An increase in customs duties by India on the goods in 
question was totally inconsistent with Article  II of the GATT. India repeatedly referred to the goods 
at issue as being new technologies or new products , and argued on that basis that the said products 
were neither covered under India's ITA  commitments, nor by its tariff binding commitments. 
However, based on the Secretariat Note on HS20 07 amendment in relation to ITA  products and a 
model list in HS2007 , the goods in question were covered in the ITA -1 commitments and India had 
therefore already incorporated them, as such, into its 1996  Schedule of Concessions, as well as into 
its current Schedule of Concessions. India was asked to kindly  eliminate the tariff at issue.  
11.13.   The delegate of Singapore  said that they remained concerned that India continued to impose 
tariffs on ICT  products that were already covered under India's ITA  commitments. Bi lateral 
engagement with officials in New Delhi was ongoing and they hoped that the issue could be resolved 
quickly an d with minimal impact on trade.  G/C/M/131  
 
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  11.14.   The delegate of Thailand  share d Members' concern s over this issue, which regrettably 
continued to escalate.  His delegation reiterated th e commercial and systemic interest s they held in 
the products in question. His delegation looked forward to further clarification from India and urged 
it to bring its tariff  regime  into line with its WTO  commitments.  
11.15.   The delega te of the Republic of Korea  said that , as one of the contracting parties to the ITA, 
Korea was concerned over this issue from a systemic perspective. India should give duty -free access 
to any goods belonging to HS  lines to which Indi a had committed to prov ide duty -free access. Korea 
requested India to reinstate a zero -duty rate on IT products covered under the ITA.  
11.16.   The delegate of Switzerland  said that her delegation shared the concerns of other Members 
regarding the duty treatment applied to certain  teleco mmunication s equipment in India. The issue 
was India's binding commitments. IT  products listed in India's Schedule, for which the bound rate 
was zero, should not be subject to any import duty when imported into India. The MFN  published 
tariff on mobile phones was inco nsistent with India's commitment in its 2015  certified Schedule. 
Switzerland therefore asked India t o abide by its WTO  commitments.  
11.17.   The delegate of India thanked previous speakers for their interventions regarding the 
concerns that had been expressed over India's tariff increase in its Unit B udget for Financial Year  
2018-2019, on the non -ITA-1 products; the ITA  products where the duty had been increased; 
transparency and the duty calculation; how to read the notification  22 of 2018 vis -à-vis the 
notificatio n of 2017; the comparability of HS8517.90 with the HS8525.20 of the HS96 vis -à-vis the 
HS2007, and the binding commitment and the duty increase and inconsistencies in India's 
ITA HS2007  commitment.  
11.18.   Regarding India's transparency in its duty calculation, a customs duty calculator was 
available on the government website , www.cbic.gov.in , which provided the customs duty, including 
the basic custom duty, as well as the GST, if relevant. This was a new facility provided by the 
Department of Revenue. The customs notification, also available on the website, provided 
information on whether or not there had been any changes to tariff lines as it was not possible to 
update the website information on an immediate basis. For trader s experiencing difficulty accessing 
the relevant information, the importer would immediately provide information on the duty 
component. Concerning  Notification  32/2018 vis -à-vis the 2017 notification, he was willing to clarify 
this issue on a bilateral basis. Regarding China's reference to HS8517.90 and its comparison to 
HS8525.20, and once he had received the relevant information , he would reply in either a bilateral 
or a multilateral forum, as required.  
11.19.   Turning to the major questio n of the increase in duty, if it were not even a listed ITA  item, 
then India was within its rights to increase the duty, which it had done in the Unit Budget for 
2018-2019, within the bound rates. With regard to ITA -1 products, India had already provided its 
explanation s of this issue, in various fora,  where it had tried to explain how this situation had 
occurred  and to try to provide its interpretations of the existing provisions. On the questions 
previously raised by certain Members, India had provided its written responses in 
document  G/IT/W/45. In addition, his delegation had provided the answer to Members' concerns at 
the CMA and the CTG, while noting that it was important to keep the technological progression in 
perspective as well as the HS  transposit ion of the telecom and IT  products.  
11.20.   India w as ready to discuss any specific views regarding the comparison of the two  tariff lines, 
including the technical aspects of these  products , through bilateral technical discussions regarding 
whether or not these products were covered under the ITA. On the duty imposed on certain telecom 
products in 2017 and 2018, India signed the ITA -1 and presented its schedule of commitment in the 
year 1997, as certified in document  WT/Let/181. India did not intend to commit wha t was there 
beyond the scope of its ITA -1 commitment. Extensive discussions and consultations had taken place 
among stakeholder s and the relevant agencies on the coverage of those products and India's 
ITA commitments. India considered that the items on whi ch duties were raised were not part of the 
ITA-1 as signed by India. His delegation sought inputs from delegations with regard to their 
perception of the different aspects relating to the coverage of those products under ITA -1, as well 
as the customs duty imposed by other Members on such products. With regard to the issue of India's 
bound rates for certain specified products in its HS2007  schedule , as notified to the WTO, Members 
had the right to re -visit the same and place the necessary rectification reque st before the CMA. India 
was working on that , would revert back to Members soon, and was ready to discuss the technicalities 
of the products bilaterally with any Member.  G/C/M/131  
 
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  11.21.   The Chairperson  thanked delegations for their interventions and proposed that the C ouncil 
take note of the statements made.  
11.22.   The Council so agreed . 
12  UNITED STATES – MEASURES RELATED TO  IMPORTS OF FISH AND  SEAFOOD 
PRODUCTS – REQUEST F ROM CHINA AND THE RU SSIAN FEDERATION  
12.1.   The Chairperson  informed the Council that , in communications dated 9 and 1 2 March  2018, 
the delegations of the Russian Federation and China, respectively, had requested the Secretariat to 
include this item on the agenda . 
12.2.   The delegate of the Russian Federation  returned to the issue of the US  Seafood Import 
Monitoring Program (SIMP). The SIMP consisted of two  major elements: reporting at the point of 
entry in to the US and record keeping of information on the chain of custody for two  years. As 
specified in the proposed and final rules, the main goal of the programme was the excl usion of 
misrepresented products and products deriving from I llegal Unreported and Underregulated 
(IUU)  fishing from entry into commerce in the US. The SIMP became effective in January  2017. Its 
mandatory compliance was required from 1  January  2018. While it was envisaged that in the future 
SIMP would cover all species that were exported to the US, at this stage only eleven  species were 
subject to new requirements. The Russian Federation shared the goal of combat ting IUU fishing; 
however, the US reasoning b ehind its differentiation of  fish species in the context of its "anti-
IUU fishing" policy was unclear . The fact that particular species imported from certain countries were 
subject to additional requirements, while other similar species supplied from other  Members were 
not, raise d serious questions regarding the SIMP's compliance with the basic MFN principle. His 
delegation had already raised the issue that certain information required under the SIMP was 
confidential by nature. Russia would appreciate receiving notice from the responsible US  agency that 
sensitive commercial and financial information collected under the SIMP  would be sufficiently 
secured.  
12.3.   Certain media reports had indicated that there were concerns among some importers 
regarding their inabili ty to guarantee the accuracy of information provided by suppliers. In this 
regard , his delegation underlined once again that reporting and record -keeping requirements alone 
could not address the problem of IUU  fishing. Without a proper verification scheme , new 
requirements were too burdensome for exporters and importers of fish and seafood products and, 
as a result, were more trade restrictive than necessary. The measure would take full effect in 
April 2018, and meanwhile the Russian Federation would contin ue to carefully monitor the measure's 
implem entation in light of WTO  rules.  
12.4.   The delegat e of China  express ed China's ongoing concern over the two  aquatic products -
related bills that the US had issued in 2017 , the "Aquatic Products Import Supervision Plan", and 
the "Fish and Fish Products Import Regulations" under the "Marine Mammal Protection Act" (MMPA). 
In China's view, there were many unreasonable aspects to the se bills. The US stated that the 
objective of  the "aquatic products import supervision plan" was to combat IUU  fishing and seafood 
fraud. However, aquaculture products bore no relation to the false capture of marine mammals, and 
the traceability of aquaculture products outside the US did not help pre vent IUU  fishing or 
aquaculture products fraud. He therefore requested the US to explain the reason and rationale 
behind these  two bills, and why they  include d cultivated species into the ir scope of application. China 
attached great importance to combattin g illegal fishing, as well as to protecting marine mammal s, 
and was willing  to further strengthen the cooperation with the US in combating IUU  fishing. However, 
China hoped that the US would consider adjusting the se two bills in order to remove aquaculture  
aquatic products from the product coverage , and that the US would also formulate the relevant laws 
and regulations on the basis of WTO  rules and without creating any unnecessary trade barriers or 
affecting international trade in aquaculture products. China also requested the US to provide any 
updates on their internal consideration s or consultation s with regard to these concern s. 
12.5.   The delegate of the United States  thanked Members for their interest in the Seafood 
Traceability Rule , the objective of which was to combat IUU  fishing and seafood fraud. The Rule thus 
required US  importers to report certain information upon entry into the US and retain other 
information that allowed the shipment to be traced back to the point of catch or harvest in order to 
preven t the US  market from being used as a place to sell fraudulently marketed seafood or seafood G/C/M/131  
 
- 35 - 
 
  products produced from IUU  fishing. The Rule went into effect on 1 January  2018 for all species 
covered therein  except for shrimp and abalone, where the requirements had been stayed 
indefinitely. On 17 January  2018, NOAA published a proposed rule to establish a voluntary "trusted 
trader" program me for US  importers of SIMP -covered species. It was intended to reduce c osts to 
both the government and industry, and streamline the processing of import entries. There was a 
60-day comment period and comments were due by 19 March  2018. Her delegation looked forward 
to working with Members on the implementation of this Rule an d on combatting IUU  fishing more 
broadly. Her delegation had understood from both China and the Russian Federation that this agenda 
item would cover expressly the Seafood Traceability Rule and not the issues that China had raised 
in its intervention. She d id not have any information to convey to China at that time with respect to 
the intervention made, but would follow up with China bilaterally.  
12.6.   The Chairperson  thanked delegations for their interventions and proposed that the Council 
take note of the statem ents made.  
12.7.   The Council so agreed . 
13  THE RUSSIAN FEDERATI ON – TRADE RESTRICTI NG PRACTICES – REQUE ST FROM THE 
EUROPEAN UNION AND T HE U NITED STATES  
13.1.   The Chairperson  informed the Council that, in communications dated 12  March  2018, the 
delegations of the EU and t he US, respectively, had requested the Secretariat to include th is item 
on the agenda.  
13.2.   The delegate of the European Union  said that no progress had been made with regard to  a 
number of issues that her delegation had already raised, with one exception, rega rding excessive 
tariffs, which had still to be confirmed. They had even observed in several cases some worsening  of 
the situation . There were no tangible changes with regard to several important issues that had first 
been raised in November  2017.  
13.3.   The cemen t certification requirement , introduced in March  2016, continued to block 
EU exports to Russia; importing companies still faced difficulties in obtaining certificates ; and 
systematic control s at the border amounted to clear  discrimination. Indeed, the discriminatory 
nature of the Technical Regulation currently in place (GOST  standard on cement certification or 
GOST  R 56836 -2016) had been recognized by the Russian Federal Anti -Monopoly Service in 
August  2017, but the technical regulation had still not be en adjusted. The EU requested Russia to 
correct this discriminatory dimension and , in doing so, to respect all WTO  rules in terms of 
notification to other WTO  Members , especially given that the current measure had not been properly 
notified. The EU also ca lled upon Russia and the other four members of the Eurasian Economic 
Union  (EAEU) not to replicate the discriminatory character of this measure in the technical regulation 
that was under  preparation at EA EU level.  
13.4.   The requirement of "good manufacturing pra ctice" (GMP) certificates for pharmaceuticals, 
which had not been notified to the WTO so far, also remained an important obstacle  to imports of 
pharmaceutical products into the Russian Federation. The procedure to obtain GMP  certificates was 
more complicat ed for importing companies than for domestic producers  as there were too few 
inspectors . Moreover, obtaining GMP certificates  was necessary before a request could be made for 
a marketing authorization , which was not the case for domestic producers. The  EU was aware of 
legislative developments since the beginning of the year to allow importing companies to request in 
parallel GMP  certificates and marketing authorization, which could ease the situation for part of the 
problem, although the EU  did not yet see any real progres s in the legislative procedure.  
13.5.   The ban on exports on raw hides and skins, introduced in August  2014 initially for six  months, 
had now been extended for the sixth time since then , through Decree  1130/2017. The measure 
could not  therefore  be considered a temporary ban. A nd a renewal of the ban would no longer meet 
the requirements of GATT  Article  XI(2)(a). Her delegation wished to receive  further detailed 
explanations and replies to its written questions on the subject of that ban  and likewise remained 
concerned by the embargo on fishery products from Estonia that had been in place since June  2015, 
allegedly for SPS reasons. Since then, the EU had raised this issue in the SPS  Committee on several 
occasions. As for the wine taxation regime , as modified in the summer of 2017 , this unfortunately G/C/M/131  
 
- 36 - 
 
  had not evolved positively. Last summer, Russia had passed a law setting a taxation regime that 
was heavier on importe d wines than on domestic wines.  
13.6.   The only positive development regarding the issues raised by the EU concerned the correction 
by the Russian Federation of excessive tariffs on several lines that had previously been mentioned 
by the EU ; indeed, the  applied import duties had been corrected on several lines already and the EU 
understood that the remaining correction would be in place by 24  March  2018, at the latest. They 
noted this positive development and welcomed Russia's action to keep its applied tariffs within the 
limits of its bound schedule.  
13.7.   Nevertheless, the EU underline d two new issue s. The first new issue concerned  the increasing 
difficulty that importing companies , in the case of goods , and foreign companies , in the case of 
services , faced in terms of participation in Russian SOEs' purchases. A series of measures had been 
put in place since 2015 to restrict the access of importing  and foreign companies to these purchases , 
the latest dating to December  2017, with a further control of purchases of aeroplanes and ships. 
The EU and other WTO  Members had raised these measures several times at the TRIMS  Committee. 
The EU urged Russia to reply to the EU's questions on this matter. The second  issue concerned the 
regime to be applied to the automotive sector as of 1  July 2018. W hen joining the WTO in 2012, 
Russia had been allowed to maintain several WTO -incompatible measures. Those measures allowed 
the Russian Federation to import car parts free of duty on the condition of local content requirements , 
an exemption that was due to end by 30  June 2018. The EU  urged the Russian Federation to inform 
Members of its decision, first, effectively to put an end to the current WTO -incompatible regime, and 
second, possibly to adopt measures to take over from the current regime. The informatio n should 
be timely to allow consultations to take place before the entry into force of any new measures , in 
line with the provisions of  Russia's WTO  accession report.  
13.8.   The delegate of the United States  added its voice to the concern s raised by the EU regard ing 
Russia's "temporary" ban on exports of raw hides and skins. This so -called "temporary" ban had now 
been in place for nearly four years. The US had intervened in the past in opposition to other 
Members' export bans on the grounds that they were contrary  to WTO rules, except under limited 
circumstances. As the US had noted before, they were concerned that the Russian ban was yet 
another manifestation of Russia's increasing reliance on import -substitution policies , and its rejection 
of the core market -opening principles of the WTO. By prohibiting exports, Russia depressed domestic 
prices and encouraged consumption of the domestic product, to the detriment of imports. On the 
issue of GMP  certificates, the US appreciated that Russia had extended the validity of previously 
issued pharmaceutical certificates until 2025, removing the most immediate threat of delays in 
review and pharmaceutical shortages. Nevertheless, the US remained concerned over the Russian 
Federation's limited resources through  which to implement its GMP  requirements, and also the slow 
pace of inspections. Her delegation urged the Russian Federation to work closely with industry to 
respond to the needs and concerns of US  stakeholders to ensure that the market remained ope n to 
US exports of pharmaceutical products. The US echoed the EU on its concerns regarding the 
discriminatory taxes applied to imported wines but not to wines domestically produced, and aske d 
Russia to address this issue.  
13.9.   The US also expressed concern over a discussion on market access that was occurring in the 
TRIMS  Committee. Over a number of years , the US had sought information from Russia about its 
local content requirements –measures that effectively discriminate d against imported goods. For over 
two years, the US had asked Russia specifically about its Law No.  223-FZ "On the Purchasing of 
Goods, Works, and Services by Certain Types of Legal Entities" , as well as about a variety of 
subsidiary measures implementing Law No.  223-FZ. That law, in conjunction  with other laws and 
their implementing measures, created a web of local content requirements and preferential 
treatment applied to the purchasing decisions of state-owned enterprises. These measures, which 
discriminated against imports of goods from other  Members, undermined the core principle  of MFN . 
However, the Russian Federation  had declined to respond to US questions on this matter submitted 
in May  2016, April  2017, and January  2018. Her delegation had also requested the Russian 
Federation to explain how its local content requirements were consistent with its WTO  obligations 
under GATT  Article  III, and when the US could expect to receive answers to  its three  sets of 
questions . 
13.10.   The delegate of Ukraine  share d the concerns raised by the EU and the US on issues that had 
already been raised at other WTO fora, even if  no progress had been made since then. The  following 
issues had also been raised in the TBT  Committee, for example: rules of cement certification; G/C/M/131  
 
- 37 - 
 
  technical regulation of the Customs Union "On safety of toys"; and state registration of medical 
devices and draft technical regulation on safety of alcoholic beverages. Unfortunately, bilateral 
consultations on all of these measures had failed to lead to any practical result. His delegation called 
upon the Russian Federation fully to comply with its WTO  commitments in order to ensure 
predictability and transparent trading conditions, and also to remove any unjustifiable bans and 
discriminatory barriers to t rade. 
13.11.   The delegate of the Russian Federation  said that Russia had taken note of the concerns 
raised by previous speakers.  His delegation , in past meetings of the TBT and TRIMS  Committee s, 
the CMA , and the SPS  Committee , had provided explicit explanations re garding all of the measures 
that had been raised again by the three  delegation s on this occasion . 
13.12.   On cement, he indicated that the practice of the GOST -R (56836 -2016) application had 
shown the necessity for changes  and, in order to implement those changes , draft amendments to 
the GOST -R had recently been developed and published on the website of the Federal Agency for 
Technical Regulation and Metrology. Public consultations on the draft ended on 1  March  2018 and 
the final text was being finalized taking int o consideration all of the comments received during the 
public consultation  process . The document, inter alia , provided for the elimination of additional 
inspection control s. The Russian Federation continued to a ssess  the practice of applying cement 
certification rules in light of the concerns of interested Members. With regard to pharmaceuticals 
and good manufacturing practice, Russia was convinced that the Russian GMP  inspection system 
fully complied with international standards and recommendations in tha t area. The State Institute 
of Pharmaceutical Products and Good Practices, which was subordinate d to the Ministry of Industry 
and Trade of the Russian Federation, was the body authorized to conduct GMP  inspections. The 
schedule of inspections published on the Ministry of Industry and Trade website for foreign 
production sites included more than 300  inspections during the period from February to 
August  2018. Moreover, the Russian Federation and the E AEU were ready to discuss issues of mutual 
recognition of G MP inspections w ith interested WTO  Members.  
13.13.   Regarding the issue of raw skins and hides, his delegation emphasized that the measure had 
been introduced in order to ensure the implementation of national defence procurement. The Russian 
Federation considered that the measure was in full compliance with WTO  rules. Turning to imports 
of fish products from Estonia and Latvia, some progress had been made over the last three  months ; 
for example, following  inspections carried out in 2016, on 15  December  2017 the Veterinary Service 
of the Russian Federation had lifted restrictions from one Estonian and one Latvian establishment. 
Final results of the above -mentioned inspections would be sent to the EU  compe tent authorities in 
due course.  
13.14.   Regarding  wine taxation, the Go vernment of the Russian Federation was currently working 
on possible ways of improving  the working of its geographical indications protection system. They 
were convinced that promotion of production of high quality wine in localities boasting a unique 
geographical situation could help them to reach the goal of sustainable population development in 
such regions. They were currently carrying out the necessary work in order to elaborate more 
effective and transparent ways  on the basis of which  to promote the use of GI  protection by wine 
producers. The tariff issue did not need any additional comment as it was merely explanatory.  
13.15.   Regarding Russia's import substitution policy, and as his delegation had previously explained 
in other relevant WTO  bodies –in particular, the TRIMs  Committee –import substitution policy had 
nothing to do with displacing foreign products from the Russian market. Rather, its goal was to 
increase the share of Russian suppliers in production chains, to strengthen their compet itiveness, 
and to improve the standing of Russian -made goods. Measures implementing import substitution 
policies were designed , with all possible  effort , to ensure their consistency with WTO  rules.  
13.16.   His delegation believed that it was better to discuss the questions and answers raised within 
the relevant committee s and not to refer these questions to the CTG. They were ready to continue 
communicating with the US with regard to these questions.  
13.17.   Concerning the Industrial Assembly  Mode , he said that t he work on  its transformation was 
currently under  way. The parameters of future measures that might be applied after 1 July 2018 in 
respect of producers operating in the regime had not yet been defined  and the responsible authorities 
still held differing views on th e matter. Russia would be able to share its views with interested G/C/M/131  
 
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  WTO Members  as soon as the consolidated position had been worked out and the regime had been 
adjusted . 
13.18.   The Chairperson  thanked delegations for their interventions and proposed that the Counc il 
take note of the statements made.  
13.19.   The Council so agreed . 
14  MEXICO – CUSTOMS PRO CESSING FEE IMPOSED BY MEXICO ON CERTAIN  IMPORTS 
ENTERING ITS TERRITO RY – REQUEST FROM EC UADOR  
14.1.   The Chairperson  informed the Council that, in a communication dated 6  March  2018, the 
delegation of Ecuador had requested the Secretariat to include th is item on the agenda.  
14.2.   The delegate of Ecuador  recalled that, during Mexico's last TPR , Ecuador had posed  questions 
to Mexico regard ing its Customs Processing Fee applied in line with the 1981  legislation and its 
subsequent reforms . In particular , Ecuador remained concerned about the discriminatory nature of 
the fee s as these were not imposed on all goods and exempted certain goods originating in countries 
with which Mexico had signed commercial agreements. Goods entering into Mexico's territory under 
preferential regimes were also exempted from these fees , including tax services . This was not 
permitted under the MTS. It could be argued that the service rate was applied in line with the tariffs, 
but there would nevertheless be discrimination considering that there was no duty because of these 
commercial or preferential arrangements. Ecuador requested Mexico to provide greater  detail about 
its Customs Processing Fee and t he way in which it was applied.  
14.3.   The delegate of Canada  expressed his delegation 's interest  in receiving  more information on 
this issue.  
14.4.   The delegate of Mexico  thanked Ecuador for its interest in its trade policies and , in particular , 
in the Customs Process ing Fee. Mexico had provided its responses at its last TPR , where it had 
pointed out that the processing fee was applied to all international trade operations, and all goods 
were subject to them.  However, Mexico had signed various FTAs that exempted from customs 
processing fees  goods originating in countries that were signatories to those FTAs.  
14.5.   Paragraph  5(a) of Article  XXIV of the GATT provided that, in respect of a free trade zone , 
customs duties and any other trade practices that were applicable to Members that did not make up 
part of the trade agreement at the time when the zone was established must not be higher or more 
strictly applied than those in force before the creation of the free trade zone. In other words, as a 
result of a preferential trade agreement  (PTA) , there were customs fees and trade rules that were 
more restrictive than those applied to Members that were party to the PTA s. This was clearly the 
current case, because Mexico  applied the fe es to all Members, while keeping with the trade 
agreements that currently existed. Mexico remained open to continue d dialogue with Ecuador on 
this or any other matter that Ecuador might wish to clarify . 
14.6.   The Chairperson  proposed that the Council ta ke note of the statements made.  
14.7.   The C ouncil  so agreed . 
15  EGYPT – MANUFACTURER  REGISTRATION SYSTEM  – REQUEST FROM THE EUROPEAN 
UNION AND THE UNITED STATES  
15.1.   The Chairperson  inform ed the Council that, in communications dated 12  March  2018, the 
delegations of the Europea n Union and the United States , respectively, requested the Secretariat to 
include th is item on the agenda.  
15.2.   The delegate of the European Union  appreciated the exchange that had taken place between 
the EU and the Egyptian authorities on Ministerial Decrees N o. 991/2015 (G/TBT/N/EGY/115) and 
No. 43/2016 (G/TBT/N/EGY/114). Unfortunately, despite the se numerous exchanges, the 
implementation of the Egyptian decrees continued to create unneces sary obstacles to trade. The 
EU industry , in particular small and medium -sized companies, continued to report serious difficulties 
with regard to the duplication of procedures and, in particular, long delays in the registration process. G/C/M/131  
 
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  Moreover, the process was not transparent, as the list of registered companies had not been  made 
available to the public. The EU ask ed Egypt to suspend the application of the measures, to review 
them in light of WTO  principles , and to re-notify them under the TBT  Agreement.  
15.3.   Without prejudice to requesting the suspension of the application of the  measures, the EU 
also wished the Egyptian authorities to consider some improvements to the implementation of the 
Decrees , in particular , and as mentioned on other occasions: (a)  setting a strict deadline for the 
decision on registration requests; (b)  creating a publicly accessible database of registered 
companies; (c)  providing an opportunity of appeal to companies in case of refused regis tration; and 
(d) registering without further delay all the companies that had submitted complete documentation 
and that were awaiting ministerial approval of the registration. The EU also invited Egypt to avoid 
the need for repeated registrations by the sa me companies for the same products in various 
registries. Once a company had been listed as a "trusted importer " under Decree  991, this should 
already be considered as sufficient assurance of the quality and safety of its products. The EU called 
on Egypt t o take these comments into account and to inform Members of  steps taken to make its 
manufacturer registration system  less burdensome for companies.  
15.4.   The delegate of the United States  thanked the EU for again raising this issue. The US 
continued to have simi lar concerns, and while US  companies did not have any pe nding registration 
requests, US  authorities did regularly hear concerns that the registration process was trade -
restrictive, lacked transparency, and took many months to complete. Her delegation had s uggested 
to Egypt certain steps it could take to ensure that its system was not unnecessarily trade restrictive , 
and they  would welcome any updates from Egypt in this regard.  
15.5.   The delegate of Ukraine  thanked the EU and the US for raising this issue. Ukraine had been 
closely following the issue and was concerned about Egypt's manufacturer registration system. 
Despite Ukraine's previous engagement with Egypt, both at bilateral and multilateral level, they had 
still not seen any improvement in the  situation , and Ukrainian companies were still waiting for 
registration by Egypt's General Organization for Import and Export Control, even when all required 
formalities had been completed. Still others were yet to be informed about the relevant registrati on 
process. The Egyptian Registration System procedures were lengthy, costly, and complicated. 
Ukraine considered that both the pre -application and the implementation of the registration system 
were burdensome, non -transparent, and created unnecessary obst acles to trade. They called upon 
Egypt to consider removing its ma nufacturer registration system.  
15.6.   The delegate of Switzerland  reiterated Switzerland's ongoing concern over Decree 
No. 43/2016, as raised at previous meetings of the TBT  Committee. Like others , Switzerland 
remained concerned by the non -transparent application of the quality certification and registration 
requirements. The lack of adequate time-periods for the registration process , and the subsequent 
decree by the Minister of Foreign Trade , were also additional burden s for economic operators, as the 
approval of registration requests remained uncertain and advanced only slowly. In addition, the 
renewal of registration also contributed to the challenges facing Swiss industry. Indeed, Switzerland 
was concerned that that these ongoing problems were driving Swiss companies out of the Egyptian 
market. She thank ed Egypt for the ir bilateral exchanges on the issue and looked forward to further 
constructive cooperation on this topic . 
15.7.   The delegate of Egypt  thanked previous speakers for their ongoing interest in th is matter. His 
delegation took note of all of the concerns raised and referred interested Members to Egypt 's replies 
provided at previous meeting s of the CTG and the TBT  committee . 
15.8.   Egypt highlighted several  points  concerning these Decrees : (i) the registration process under 
Decree No.  43/2016 was administrative in nature and any credible manufacturer could easily comply 
with its requirements. The decree did not impose further burdens on producers or companies in 
order to comply with specific technic al regulations. The decree provided credible producers with a 
better competitive environment as it allowed for more control of counterfeited products imported 
into Egypt ; (ii) Egypt recognized that the verification process of documentation required by Decree 
No. 43/2016 might have caused delays in some cases  but explained that this had only been in the 
early phase of the system 's introduction , due to the huge number of registration applications 
received , coupled with limited human resources. However,  Egypt had recently taken appropriate 
measures to accelerate  the registration process ; (iii) after more than two  years of implementation, 
Egypt strongly believed that the registration requirements under the decree were not more trade -
restrictive than necessary, a nd that they were in full compliance with WTO  rules, and especially with G/C/M/131  
 
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  Egypt's commi tments under the TBT  Agreement ; (iv) the government of Egypt was periodically 
reviewing and assessing its measures and regulations that affected imports and trade in gene ral, 
with the goal of enhancing the business environment and facilitating trade. In that context, not only 
had Egypt accelerated the process of registration , but it had also improved its transparency , and 
once the registration process had been finalized, t he companies concerned had been duly informed. 
His delegation would share the lists of the registered companies with interested delegations ; 
(v) Egypt confirmed that its manufacturing plants were also subject to registration, surveillance, and 
inspection r equirements by the Egyptian regulatory authorities so as to ensure also their compliance 
with relevant standards and regulations. Therefore, Decree  No. 43/2016 did not contravene the 
National Treatment principle.  
15.9.   Egypt stood ready to engage constructively on this issue with any interested delegation, and 
was ready to provide assistance regarding any implementation obstacles encountered by foreign 
companies. He encouraged Egypt's trading  partners to approach his delegation directly with their 
concerns, and thanked those trading partners concerned for the constructive consultations that they 
had held during the course of the week, on the margins of the TBT  Committee meetings. He had 
taken note of all of the points raised , would c onvey the se new concerns to Capital , and would revert  
back to intere sted delegations in due course.  
15.10.   The Chairperson  proposed that the Council ta ke note of the statements made.  
15.11.   The Council so agreed . 
16  CHINA - CUSTOMS DUTI ES ON CERTAIN INTEGR ATED CIRCUITS – REQUEST FROM THE 
EUROPEAN UNION, JAPA N, CHINESE TAIPEI, A ND THE UNITED STATES  
16.1.   The Chairperson  informed the Council that, in communications dated 12  March  2018, the 
delegations of the European Union, Japan, Chinese Taipei, and the United States , respectively , had 
requested the Secretariat to include this item on the agenda.  
16.2.   The delegate of the United States  recalled that her delegation had elevated its concern with 
regard to a change in China's applied duty rates on semiconductor products for the first  time at the 
CTG's previous meeting , an issue that had previously been raised at both the ITA  Committee and 
the C MA. Since the November meeting of the CTG, China had engaged with concerned Members, 
and in the last two  weeks had shared with them information regarding its transposition calculations. 
However, this recent information had not alleviate d US concerns , which the US detailed as follows . 
Since 1 January  2017, China had been imposing tariffs on a number of semiconductor products that 
had previously been duty -free by virtue of China's WTO  bound commitments. To date, the situation 
had not changed and semiconductor shipments were still subject to duty when less than one  year 
ago such shipments would have been duty -free. The US did not see how th is situatio n could be 
consistent with China's WTO  binding tariff commitments ; instead, it appeared to form part of a 
worrying trend in support of  China's  "Made in China 2025" campaign.  
16.3.   China had responded that it was a technical issue, and that they had simply used o ne of the 
WTO-sanctioned methodologies to perform a complex HS  transposition for those particular 
semiconductor products. The US was still studying the transposition document that China had 
recently shared but nevertheless had some initial concerns  over it, specifically pertaining to the 
starting point for the base rates that China had used to calculate its averages in the respective tariff 
lines. It appeared that China had calculated the base rates for its averages prior to any ITA  Expansion 
tariff cuts. F or example, when consider ing tariff line  8415.90.10, it seemed that the base rate for 
China's calculation was 10%. However, China 's tariff rates after the first  ITA Expansion cut in 
September  2016 were applied at 8.3%. Given that the concordance occurred i n January  2017, the 
starting point for the average should have been the tariff rates that were in place in December  2016, 
and which reflect ed the first  round of ITA Expansion tariff cuts. However, China appeared to have 
reverted to the tariff rate applied prior to the first ITA  Expansion tariff cut. Setting the specific 
calculations aside, the WTO  General Council Decision on HS  transpositions , to which  China often 
made reference , made clear that the bound rates in the new HS  nomenclature should fully reflec t 
the same level of concessions as granted under the old nomenclature –namely, the scope of 
concessions should  remain unchanged. But the fact remained that the scope of China's concessions 
had changed substantially, and the value of the concession had been impaired, in that semiconductor 
products that had been duty -free for over a  decade were now facing duties.  G/C/M/131  
 
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  16.4.   The G C Decision on the HS  transposition allowed for the use of an alternative methodology 
only if combining tariff lines was "unavoidable" as part of  the HS  transposition. However, in the case 
of multi-component semiconductors ( MCOs ), the use of a simple arithmetic average was most 
certainly avoidable. For example, China could have chosen to apply the lowest rate of any previous 
tariff line to the whol e of the new tariff line –in this case, zero  duty. But the US was  not asking China 
to apply a zero  duty to the products that had been previously subject to duty. Instead, the US  was 
asking China to maintain its duty -free concessions by creating additional n ational tariff lines under 
tariff heading  8542 for certain end -use products such as appliances. This was the standard 
methodology that Members should apply in a transposition. The US also noted that other 
ITA Members had managed to implement the HS2017  transposition without difficulty and without 
raising tariff rates on semiconductors, and so they again q uestioned why China did not do the same. 
Her delegation urged China to reinstate zero  duties on all products previously classified under duty -
free tariff lines in HS2012  nomenclature. China ha d an obligation to provide duty -free treatment 
pursuant to its W TO bound commitmen ts, and to do so without delay.  
16.5.   The delegate of the European Union  thanked China for its engagement on this issue, both 
bilaterally and in other contexts , such as at the GAMS  setting. Following exchanges on the matter 
at the C TG, the ITA , and the Market Access Committees, China had finally provided the calculation 
it used for the transposition of tariffs on MCOs towards tariff heading  8542 under HS2017, for which 
the EU was grateful . Although the method used was now clearer to the EU, a nu mber of questions 
still remained: for example, why did China not make an ex -out for those lines already applied at 
zero? When implementing reclassification under HS2017, China had calculated two  different 
averages: one of 3.4% , obtained by averaging the pr evious duty rates of the 17  MCO lines, the other 
of 3.2% , averaging the previous duty rates of only 16 of the 17  product lines ( Isolated Gate Bi -Polar 
Transistors ( IGBT) modules were excluded). China allocated the 3.2% average to one  single 
subheading and the 3.4% to three  different subheadings. This led to the following questions: Why 
did China apply two  separate averages to MCOs? Could China explain the criteria used to allocate 
the 3.2% and 3.4% to the different products? One  specific line – IBGT Tariff line HS 8504.40.91 – 
was being treated differently. Assuming that IGBT was considered as an MCO, could China explain 
why neither the 3.4% nor the 3.2% average duty rate applied, and why a d uty rate of 5% was 
applied instead?  
16.6.   The delegate of Japan  joined ot her Members in expressing Japan's concern over the issues of 
customs duties on certain products using MCOs. As stated at the last CTG  meeting, Japan had not 
yet received a response from China regarding which specific tariff line and tariff rate had been used 
to calculate the current MCO  applied tariff rates. He requested China to provide a "correlation table" 
that clarified the relationship between the previous rates of duty for each tariff line at issue and the 
current rates of duty. H e asked China to pr ovide written information demonstrating that China was 
committed to fulfilling the phase -out schedule under the ITA  expansion, including the complete 
elimination of duties on all MCO  products in 2021. H e thanked China for the explanation provided so 
far; however, Japan remained concerned over the issue. The tariff that China had imposed on 
MCO products was higher than its bound rate and was therefore in violation of China's obligation 
under GATT  Article  II. The measure seriously undermined the benefits accruing to Japanese 
industry. Japan requested China to provide its justification for the method used , and also to provide 
the necessary last three  years of import data for the MCO  products at issue. Japan urged China 
immediately to delete the tariff rate appl ied to import s of these MCO products.  
16.7.   The delegate of Singapore  registered her delegation's interest in the implementation issue, 
which they would be monitoring closely . 
16.8.   The delegate of the Republic of Korea  reiterated his country's  concern regarding this issue. 
Korea believed that China should impose tariff rates on MCO  items that were fully in keeping with  
the spirit and principle of the ITA  Expansion Agreement , and to provide a detailed explanation  for 
why it was not doing so . 
16.9.   The delegate of Switzerland  shared the concerns expressed by previous speakers, and noted 
that this was not a technical issue. Examining  China's ITA  II schedule in HS2007, there wa s a clear 
commitment to bind duties at zero for all electronic integrated circuits classified under 
HS heading  8542. As a technical process, any HS  transposition should not modify any concessions 
already granted. Switzerland therefore invited China to remedy the situation as soon as possible.  G/C/M/131  
 
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  16.10.   The delegate of China  thanked the previous speakers for their com ments. His delegation had 
been engaging with the US and the EU, among others, in the GAMS  framework, where China's 
technical officers  from the Ministry of Finance  and the Tariff Commission had presented their 
correlation table. As requested by Japan, China  would also provide the table to Japan in due course , 
as well as written information concerning China' s ITA Schedule.  
16.11.   The question had been discussed at various meetings, including at the ITA, and the Market 
Access  Committees , and also at the last CTG meeting. China's faith in implementing the 
ITA Expansion commitment should not be questioned  given that the increase on certain MCO and 
certain IC T products that had previously been treated as zero  duty was purely because of a 
transposition that had been carri ed out in 2017. Had that transposition not been carried out , the 
duty rate would have remained the same. In any case , the duty rate would go to zero after the 
implementation period. In the context of  the ITA  Expansion Agreement, MCO had been  one of the 
most debated lines , including  in the last round and during last-minute negotiations, and for that line 
China had secure d a five -year implementation period. He assured the Membership that, five  years 
after implementation, all MCOs would be reduced to zero. The technical questions posed by the US 
would be referred  back to Capital . The written notice from the EU on the question of why there were 
two different averages , and which line corresponded to which, would likewise  be studied in Capital 
in due course . China was implementing the ITA  Expansion Agreement in good faith , had participated 
in good faith in the ITA Expansion Agreement negotiations, and would also honour its commitment s 
in good faith. 
16.12.   The Chairperson  proposed that the Council ta ke note of the stat ements made.  
16.13.   The Council so agreed . 
17  VIET NAM – DECREE ON  THE REGULATION ON C ONDITIONS FOR AUTOMO BILES 
MANUFACTURING, ASSEM BLING, IMPORTING, AN D AUTOMOTIVE WARRANT Y AND 
MAINTENANCE SERVICES  – REQUEST FROM JAPA N AND THE U NITED STATES  
17.1.   The Chairperson  informed  the Council that , in a communication dated 12  March  2018, the 
delegations of Japan and the U nited States,  respectively , had requested the Secretariat to include 
this item on the agenda.  
17.2.   The delegate of Japan  said that the impact on the export of automobiles to Viet Nam of 
Viet Nam's Decree  116 of 1  January  2018 had been significant , and requested Viet Nam to take 
measures quickly  to improve the system , while consider ing also the comments that had been 
submitted from industry stakeholders. In parti cular, in relation to the import of finished automobiles, 
the decree required the submission of a copy of the quality certificate of automobile types issued by 
foreign authorities. Japan believed that such a form of regulation was without precedent. Since 
domestically produced automobiles required only vehicle type approval issued by the Vietnamese 
authorities , Japan requested that the same treatment be applied to imported automobiles. As for 
the requirement of a security/emissions inspection and test , which were carried out lot -by-lot, Japan 
noted that, in comparison with domestically produced automobiles, imported automobiles were 
subject to stricter and less favourable treatment in terms of the frequency of inspections. Japan 
therefore requested the same treatment for imported automobiles as that applied to domestically 
produced automobiles. At the same time, Japan urged Viet Nam to ensure that its measures were 
in accordance with WTO  principles, which stipulated that Members not discriminate between 
domes tic and foreign products or impose greater trade restrictions than necessary to fulfil a 
legitimate policy objective.  
17.3.   The delegate of the United States  supported the comments made by Japan. The US was 
extremely concerned about Decree  116, which further tig htened conditions for auto mobile  
manufacture, assembly, importation, auto mobile  services, and warranties, and introduced extensive 
changes to testing and verification requirements for imported vehicles. US  automobile  
manufacturers were unable to comply wit h the Decree and, as a result, imports of US -manufactured 
vehicles had ceased as of 1 January  2018. In addition, the lot -by-lot testing requirements did not 
apply to domestically produced vehicles, resulting in discriminatory treatment for imports. The US 
requested Viet Nam to immediately suspend its implementation of Decree  116 and its implementing 
circular , and instead  to dev elop a long-term, workable solution that did not effectively close the 
marketplace to foreign vehicles. The y also requested that the decree and circular be amended in G/C/M/131  
 
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  consultation with industry stakeholders and the US  Government so that US  automobile  
manuf acturers could again resume exporting their vehicles into Viet Nam.  
17.4.   The delegate of Thailand  thanked Japan and the US for raising th is issue, which had already 
been raised by his delegation at the most recent meeting of the TBT Committee, bilaterally , and also 
via written comments to Viet Nam's Enquiry point . Thailand was concerned by the serious impact on 
the automobile trade of Decree  116. Viet Nam had notified Decree  116 to the WTO on 7  March  2018, 
after its effective date of entry into force had been 1 January  2018; thus, interested parties  had not 
received an opportunity to comment on the proposed regulation. The formation and application of 
the Decree also appeared to be inconsistent with Viet Nam's WTO  obligations and , furthermore,  the 
regulation was applied in a non -transparent, trade  restrictive , and discriminatory manner. The 
requirements were burdensome and costly, and created unnecessary obstacles to trade. In addition, 
it also appeared that cars of Vietnamese origin were treated more favourably t han those originating 
in other countries , since their testing results and certificates were valid for 36  months , whereas 
imported cars were subjected to lot -by-lot inspection. In this regard, Thailand would appreciate it if 
Viet Nam would take Thailand's concerns into consideration and fulfil  its obligations under the WTO.  
17.5.   The delegate of Canada  indicated that Canada held a significant interest in this issue, and in 
Viet Nam's Decree , because the vast majority of vehicles manufactured in Canada were built to 
US Federal Motor Vehicle Safety Standards (FMVSS). Those standards and, by extension, Canadian 
Motor Vehicle Safety Standards (CMVSS), had consistently provided stringent and comprehensive 
performance outcomes with regard to vehicle safety. Conformity a ssessment procedures were as 
important as technical regulations in facilitating trade. WTO  obligations required that compliance, 
testing , and conformity assessment procedures , were no more trade restrictive than necessary. 
Canada encourage d Viet Nam to mai ntain a flexible vehicle certification process, and one that 
allowed for  both type a pproval and self -certification.  
17.6.   The delegate of the European Union  said that the new testing procedures under this Decree, 
and the request for a Vehicle Type Approval certificate, different from the UNECE, would cause delays 
at customs and impose an additional cost burden on EU exporters. In turn, this would  harm their 
competitiveness vis -à-vis locally manufactured brands. The  EU regretted that, while the Decree had 
enter ed into force on 1  January  2018, it had only been notified to the TBT  Committee on 
7 March  2018, thus not allow ing Members  time to comment. The EU recalled that, in accordance 
with the TBT  Agreement, notificati ons to the WTO should take place at an early and appropriate 
stage, when amendments to the measure could still be introduced , and that reasonable time should 
be allowed for comments, so that such comments could then be taken into consideration. The E U 
requested Viet Nam to postpone the application of the Decree so as to allow sufficient time for 
comments. Furthermore, Viet Nam should allow for a reasonable interval of time between the 
publication and the enforcement of the adopted measures, so as to aff ord producers from exporting 
Members sufficient time to adapt their products or methods of production to new Vietnamese 
requirements. Finally, Canada wished also to emphasize that conformity assessment procedures 
should not be prepared, adopted , or applied  with a view to, or with the effect of, creating 
unnecessary obstacles to trade.  
17.7.   The delegate of Viet Nam  thanked delegations for their interest and concern with regard to 
Decree  116 on requirements for manufacturing, assembly, and import of automobiles an d trade in 
automobiles warranty and maintenance services, which had been notified to the WTO on 
7 March  2018. It thanked those Members that had held bilateral meetings with Viet Nam to discuss 
this issue further . Viet Nam had promulgated this measure belie ving that its legitimate public policy 
objective was to ensure consumers' safety and environmental protection. Furthermore, the 
fundamental principle of non -discrimination between domestic and foreign enterprise s had been 
upheld. In the meantime, his deleg ation took note of all of the comments and concerns that Members 
had raised and would duly relay these to the relevant authorities for furth er consideration and 
response.  
17.8.   The Chairperson  proposed that the Council ta ke note of the statements made.  
17.9.   The Council so agreed . G/C/M/131  
 
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  18  CHINA – NEW EXPORT C ONTROL LAW – REQUEST  FROM JAPAN  
18.1.   The Chairperson  informed the Council that, in a communication dated 12  March  2018, the 
delegation of Japan had requested the Secretariat to include this item on the agenda.  
18.2.   The dele gate of Japan  noted that this was the first  time that the issue of China's draft Export 
Control Law, which had been released by China in June  2017, had been raised at the CTG . The draft 
law was under consideration by China's National Congress ; nevertheless , Japan wished already to 
raise several issues of concern regarding the draft  law, and in particular  regarding its compliance 
with GATT  Article  XI, Quantitative Restrictions, and to request further clarificatio n from  China.  
18.3.   First, the scope of the "Protect ion of Important Strategic Rare Materials" was unclear. In 
standard international practice, export control s should be limited to the minimum restrictions 
necessary to ensure national and international interests , including safety and security. However, the 
draft Export Control Law clearly stated that it took into account such commercial factors as 
technological development, industrial competitiveness, and international market supply , in 
formulating the list of products subject  to export control. In addition, the subsidiary research and 
consultative institution under China 's Ministry of Commerce, the Chinese Academy of International 
Trade and Economic Cooperation (CAITEC), had issued a report that had emphasized the need to 
include rare materials under its security export control s as a means of coping with the issue of 
international litigation. Thus, Japan was concern ed that the scope of this draft new export control 
law could be unreasonably expanded to cover such rare materials  as rare earth, rare metals, and so 
on. They requested China to provide clarification on this point. 
18.4.   Second, Japan believed that the requirement for disclosure of technological information at 
export would be excessive. In the draft law, exporters were requ ired to submit a written application 
to the Authority at export, which included "Technical description or testing report of the export 
controlled items", among others. This was an unnecessary requirement for ensur ing appropriate 
export control, and one tha t would result in an adverse impact upon export s from companies that 
protected business and technological confid entiality.  
18.5.   Third, the purpose of responsive measures could not be consistent with international export 
control regimes. The draft law contained a provision that allowed Chinese authorities to take 
responsive  measures if any country took discriminatory export control measures against China.  
18.6.   If these measures were put in place, they could result in a negative impact on exports from 
industries in Chi na, including those from Japanese companies, and on international supply chains. 
In that regard, industry associations from the EU, the US, and Japan,  had submitted a joint 
communication on the draft Export Control Law i n February  2018. His delegation requ ested China to 
give serious consider ation to  Japan's concerns over the draft law, and to ensure that appropriate 
consultations were held with interested Members and industry associations. Japan also asked China 
about the future timeline for implementing the law and encouraged China to ensure the provision of 
a sufficient transitional period.  
18.7.   The delegate of the United States  thanked Japan for raising th is issue at the CTG. The U S also 
had an interest in China's draft l aw, and its implications, and would welcome fur ther clarification 
from China.  
18.8.   The delegate of the European Union  noted that the EU had submitted comments during the 
consultation period , in July  2017. The EU welcomed China's efforts to consolidate various e xisting 
export control provisions into a single draft export control law. The EU attached great importance to 
the convergence of export controls globally for preserving international security and ensuring a level 
playing field , and acknowledged that the dr aft law could consolidate and strengthen China's export 
control system, its strategic export controls derived from international obligations and commitments, 
and related objectives in terms of international security and non -proliferation of weapons of mass  
destruction. Against this background, the draft law contained certain provisions that required further 
clarification in terms of  their alignment with international security standards and their conformity 
with WTO multilateral trade rules . 
18.9.   The EU sought China's explanation of the reference to the "development interests of the 
State", which was mentioned in Article  1 of the draft law as an objective of Chinese export controls G/C/M/131  
 
- 45 - 
 
  and a basis for export control decisions and, in particular, its compatibility with  international law and 
China's commitments under the WTO. The same concerns applied to a number of other references , 
found  throughout the draft Law , to economic development and industrial competitiveness factors 
that should be taken into account when devel oping the list of controlled goods. Considering that 
strategic export controls reflected international security considerations and were not conceived as 
trade defence instrument s, further information  would be appreciated  on the reference to their use 
as re taliatory measures against "discriminatory export control measures" , including whether this 
principle was compatible with international law and China's commitments unde r the WTO.  
18.10.   The scope of the draft law included military and dual -use items, but also potentially other 
items. The scope of controlled goods might be set too broadly, especially in the light of the reference, 
in the draft explanation, to the "protection of important strategic rare materials". The EU was also 
concerned th at unnecessary excessive technology disclosure might be required as part of the license 
application process in Article  33 of the draft , and hoped that the written comments that the EU had 
provided would be taken on board when developing that particular asp ect of the draft legislation . 
The EU looked forward to further discuss ion of this  subject with China with a view to ensuring 
mutually beneficial convergence of export controls in line with inte rnational rules and standards.  
18.11.   The delegate of China  thanked delegations for their questions  but commented  that the title 
of the agenda item was highly misleading as the measure was a draft export control law, not a new 
export control law . His delegation had explained bilaterally to certain Members  that the law was ne w 
in the sense that it was a law , but not in terms of any more regulations for milit ary exports and 
exports of dual -use products. In basic terms, this draft legislation consolidated  existing regulations, 
but at a higher level. In June  2017, the draft was o penly published on the website of the Ministry of 
Commerce of China,  for public opinion , and a number of comments had been received that had 
resulted in the introduction into the draft of certain modifications . 
18.12.   In terms of the l egislative process, in Febru ary 2018, the draft law had been submitted to 
the State Council , and the Legislative Office of the State Council would then conduct a legislative 
review of the draft. Following this process , the draft law would once again be submitted to the 
National People's Congress f or further legislative review.  
18.13.   Regarding Japan' s concerns over whether or not this draft legislation would cover rare 
earths, China said that rare earths had been subject to WTO  dispute  settlement, and that this 
process had produced a bi nding result on China,  which it had implemented. Therefore, whatever this 
draft legislation would look like  in its final form, China would honour both its WTO  commitment s and 
the findings of the dispute settlement procedures that had already taken place. R egarding the 
disclosure requirements, and the protection of business and technical confidentiality, he assured 
Members that these aspects of the law would closely follow international  common practice in this 
area. 
18.14.   Regarding the questions on the purpose of this element  of the law, the EU had mentioned 
the objective of industrial development. If a certain item was currently under export control , 
although the same product was available elsewhere in the market, then the exporter could argue 
that, because of lev els of global industrial development, it was no longer necessary to control the 
export of such technology. This was a very reasonable provision and also common practice. 
Nevertheless, China had taken  note of all of the technical questions from Members, and requested 
delegations to submit these questions to China  in writing so as to facilitat e his delegation's 
consultations with Capital on this matter . 
18.15.   The Chairperson  proposed that the Council ta ke note of the statements made.  
18.16.   The Council so agreed . 
19  MONGO LIA - QUANTITATIVE R ESTRICTIONS AND PROH IBITIONS ON IMPORTAT ION 
OF CERTAIN AGRICULTU RAL PRODUCTS – REQUE ST FROM THE RUSSIAN FEDERATION  
19.1.   The Chairperson  informed the Council that, in a communication dated 12  March  2018, the 
delegation of the Russian Federati on had requested the Secretariat to include this item on the 
agenda.  G/C/M/131  
 
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  19.2.   The delegate of the Russian Federation  noted that, in 2013, Mongolia had established a quota 
regime for the importation of certain agricultural products, including wheat flour and milk. Indeed, 
the Ministry of Food, Agriculture, and Light Industry of Mongolia had established an import 
prohibition on wheat flour , late in 2016,  which was still in force. Mongolia's wheat flour imports had 
dropped significantly as a result of that measure and Russian exporters had suffered substantial 
losses. The Russian Federation considered the general elimination of quantitative restrictions to be 
one of the core disciplines of the GATT and WTO  legal systems , and urged Mongolia to intensify its 
discussion s with the Russian authorities in order to resolve the issue promptly . Her delegation had 
been addressing these issues in bilateral consultations with Mongolia since November  2017.  
19.3.   The delegate of Mongolia  thanked the Russian Federation for its interest in Mongolia's trade 
policy. The measures concerned had been taken in accordance with the laws on food and food 
security , which explicitly named only a few products, including flour, wheat, and milk, as strategic 
and staple food s that were essentia l for the livelihood and well -being of the people of Mongolia. 
Nevertheless , Mongolia had proposed bilateral discussions to the Russian Federation aimed at finding 
a mutually satisfactory solution in conformity with the WTO  Agreements. Mongolia stood ready  for 
further consultatio ns with Russia.  
19.4.   The Chairperson  proposed that the Council take note of the state ments made.  
19.5.   The Council so agreed . 
20  EUROPEAN UNION – AMENDMENTS TO THE DIREC TIVE 2009/28/EC, REN EWABLE 
ENERGY DIRECTIVE – REQUEST FROM MALAYSIA  
20.1.   The Chairperson  informed the Co uncil that, in a communication dated 12  March  2018, the 
delegation of Malaysia had requested the Secretariat to include th is item on the agenda.  
20.2.   The delegate of Malaysia  expressed Malaysia's concern over the discriminatory treatm ent of 
biofuels and bio -liquids produced from palm oil under the proposed amendments of the Directive of 
the European Parliament and of the Council on the Promotion of the Use of Energy from Renewable 
Sources, which had been adopted by the European Parliam ent on 17  January  2018. The 
amendments were still being discussed at the Trilogue negotiations in Brussels , and Malaysia was in 
various ways still concerned by these proposed amendments . The proposed Amendment  307 of the 
adopted text specifically singled out palm oil , as follow s: "The contribution from biofuels and 
bioliquids produced from palm oil shall be 0% from 2021". Therefore, the use of biofuels from palm 
oil would not be counted towards the EU  renewable energy targets from 2021 , as compared to 
biofuels from other competing raw materials , such as rapeseed oil , which would continue to be 
counted towards the targets until 2030. In Malaysia's view, the different treatment given to  
competing raw materials was discriminatory and contradicted the national treatment principle of 
GATT  Article  III, as palm -based biofuels would be put at a disadvantage in terms of EU market 
access . Malaysia had requested the EU to clarify and explain the rationale and scientific evidence 
used to justify singling out biofuels fr om palm oil for exclusion from the renewable energy targets 
of the EU from 2021 , vis-à-vis other crop -based biofuels until 2030.  
20.3.   There were several key features in the resolutions of the European Parliament dated 
4 April 2017, on palm oil and deforestation  of rain forests, which appear to have been adopted in 
the proposed amendments of the Renewable Energy Directive: Recommendation  49 "calls on the 
Commission to initiate a reform of the Harmonised System (HS) Nomenclature at the World Customs 
Organisation ( WCO) that would allow a distinction between certified sustainable and unsustainable 
palm oil and their derivatives"; General consideration  24, on the other hand , "calls on the 
Commission to develop a single certification system for palm oil" , which was dis criminatory in nature , 
taking into account that only palm oil would be subject to the certification scheme , while other 
vegetable oils , which were like  products , were not. In this context, unnecessary barriers would be 
created to the trade in palm oil. Furthermore, Recommendation  36 called on the Commission to 
"immediately develop a recognisable sign for all products containing palm oil, and strongly 
recommended that the sign was included on the product or packaging or was easily accessible 
through technological features".  
20.4.   The proposed amendments did not ban biofuels from palm oil but would impose unnecessary 
barriers and restrictions to the trade in biofuels produced from palm oil from Malaysia,  given that G/C/M/131  
 
- 47 - 
 
  the use of biofuels from palm oil would not  count towards the EU 's renewable energy targets , and 
therefore would not be eligible for financial support.  
20.5.   This had clearly been stipulated in the following adopted text: (i)  Amendment  67 of the 
adopted text on "The production of agricultural raw materia l for biofuels, bioliquids and biomass 
fuels, and the incentives for their use provided for in this Directive, should not have, or encourage, 
a detrimental effect on biodiversity within or outside the Union"; and (ii)  Amendment  232 of the 
adopted text on " (c) eligibility for financial support, including fiscal incentives, for the consumption 
of biofuels, bioliquids and biomass fuels". If implemented in the current form, t he quoted 
amendments , as well as recommendations of the European Parliament resolution of 4 April 2017, 
would possibly constitute a breach of the EU's commitments under various WTO  Goods Agreements. 
Malaysia requested the EU to provide the Council with further information as to how it intended to 
make these  amendments  and Resolutions operati onal, and to keep Members continually update d on 
the progress of the Trilogue negotiatio ns in Brussels.  
20.6.   Being a major exporter of palm oil products to the EU, Malaysia continued to be concerned 
also by  the EU's increasingly restrictive measures on palm oil . The amendments, if implemented in 
their present form , would have negative repercussion s on the palm oil industries of developing 
countries and would also not reflect well against the stated EU commitment towards meeting the 
Sustainable Development Goals (SDGs) , whose objective was to address poverty and to raise the 
income levels of farmers. The proposed amendments also failed to recognize the positive impact of 
the Malaysian oil palm industry on enhancing the livelihood and the living standard s of 
650,000  smallholders in the context of the socio -economic development of the country. This would 
certainly have a negative impact and would deny those who were dependent upon the palm oil 
industry from freeing themselves from poverty. The proposed amen dments disregarded the 
initiatives , efforts, and measures  by Malaysia in the area of forest and biodiversity conservation , as 
well as the international pledges by Malaysia in the context of forest and tree cover conservation 
and reduction of greenhouse gas  emissions. Indeed, Malaysia had pledged , under the Nationally 
Determined Contribution (NDC) of the Paris Agreement under the United Nations Framework 
Convention on Climate Change (UNFCCC) , to reduce its greenhouse gas emissions intensity of GDP 
by 45% by 2030 relative to the emis sions intensity of GDP in 2005.  
20.7.   Malaysian palm oil was produced in a sustainable manner and the palm oil industry was 
committed to producing palm oil in accordance with the sustainable principles and criteria under the 
Malaysian Su stainable Palm Oil (MSPO) certification scheme, which would be implemented on a 
mandatory basis by 31  December  2019. The proposed EU amendments to discriminate palm oil 
undermined the efforts carried out by Malaysia to wards  ensuring the future sustainabili ty of the 
Malaysian palm oil industry. Her delegation urged the EU to consider providing equitable treatment 
across all crop -based biofuels, including palm -based biofuels , and also urged the EU to provide 
scientific evidence to justify singling out biofuel s and bioliquids from palm oil not to be counted 
towards the EU's renewable energy targets. Malaysia would continue to monitor development s with 
regard to the intended amendments of the EU  Renewable Energy Directive  and looked forward to 
hearing the EU's response . 
20.8.   The delegate of Colombia  reiterated the comments made by his delegation at a recent 
TBT Committee  meeting . Colombia was interested in the EU's decision to introduce a policy intended 
to protect and promote the use of renewable energy  but shared the concern s expressed by Malaysia 
that this policy should not become an unnecessary trade barrier , or be more trade restrictive than 
necessary. If it were to be adopted, it would be incompatible with the MFN and a number of other 
WTO principles, including  with regard to the TBT  Agreement and GATT  Article  XIII. Nevertheless, 
Colombia believed that the suggested amendments made by the European Parliament in 
January  2018 w ould not be the very final version of this Directive , and that the EU legislative proces s 
implied that other bod ies would also have their say.  
20.9.   However, the modifications raised concerns for Colombia,  particularly with regard to their 
incompatibility with WTO  obligations, notably those concerning biofuels made from palm oil. The 
Directive set out goals for 2030 where  energy coming from renewable sources would be less than 
35% of all of the energy consumed within the EU , and at least 12% of energy consumed in all forms 
of energy used in transport. The refore , the key definition was energy from re newable sources. 
Article  2 of the Directive listed different forms of energy that could be characterized as energy 
coming from renewable sources, and this included energy produced from biomass ; by the same G/C/M/131  
 
- 48 - 
 
  principle, biofuels produced from palm oil probably  fell into that definition and should therefore be 
taken into account when calculating energy use from renewable sources by members of th e EU.  
20.10.   Article  7 of the proposal allowed for the use of biofuels based on food  crops for fuels a t a 
limit of 7% in road and rail transport. However, th is article set out that the contribution of biofuels 
or liquids produced from palm oil would be zero per cent as of 2020. This would explicitly  mean that 
fuels from palm oil would not fall into the gulf for rail and r oad transport until 2021. This would 
create a clear disincentive for producers to use any form of fuel coming from palm oil because they 
would not be able to write it off as a renewable energy source and therefore help meet the goals of 
minimal energy from  unrenewable sources. This would clearly be a discriminatory measure , because 
it did not apply to similar products  like oils produced from other forms of vegetables, such as 
sunflower oil and rapeseed oil. It was also incompatible with the obligations set out in Article  2 of 
the TBT  Agreement , and GATT  Article s I and III( 4). The use of biofuels from palm oil  would therefore 
be discouraged , and this would negative ly impact  Colombia as an exporter of biofuels from palm oil.  
Colombia asked the EU to explain ho w it could reconcile the discriminatory aspect of the measure 
with the MFN  principle and the impact that this would have on countries that produced biofuel from 
palm oil.  
20.11.   The delegate of Thailand  thanked Malaysia for raising  this issue on the Renewable Energy 
Directive  (RED) , which had been adopted by the European Parliament on 17  January  2018, and 
which could have a profound impact on the future use and consumption of palm oil  biofuels . While 
its adoption by the Parliament was not final  it would , if ado pted, discriminate palm oil against other 
types of vegetable oils. A particular product should not be treated in a discriminatory manner, and 
any discrimination should be on justifiable grounds. Thailand  looked forward to receiving further 
information, cla rification, and updates from the EU  with regard to the se amendments , and would 
continue  to monitor the matter closely.  
20.12.   The delegate of Indonesia  highlighted the importance of this issue to her country . The 
purpose of the revision was to diversify energy su pplies within the EU by 2020 for environmental 
reasons , including in light of deforestation. The Indonesian Government supported environmental 
sustainability and contributed to controlling deforestation . Indonesia  had also enacted Government 
Regulation  104 in 2015, which tightened the permit for the conversion of forest areas. Indonesia 
had also committed to the 2015 –2030 SDGs  with the pillars of social, economic, environmental , and 
sustainable development. The linkage of the renewable energy directive with  palm oil was of 
paramount importance to Indonesia given the fact that any de -linkage would potentially affect the 
livelihood s of 17 million small -scale farmers in Indonesia, all of whom heavily depended on palm oil  
for their incomes . In terms of global land use, palm oil only occupied 10% of land compared to the 
total land use of other vegetable oils. If the current provision were applied, Indonesia would be 
concerned over a proposed difference in treatment between the use of palm oi l as a biofuel feedstock 
compared to the use of other vegetable oils. In addition , the European Parliament had stated that 
vegetable oil s derived from other sources would still be allowed to be used as biofuels feedstock , 
while biofuel s derived from palm o il would be phased out. Given the importance of this issue to 
Indonesia, he urged the EU to ensure that the proposed amendments in the RED were consist ent 
with WTO  provisions . 
20.13.   The delegate of Guatemala  stated that, as a producer of palm oil, Guatemala was concern ed 
by the RED, which m ight become an unnecessary barrier to trade . Guatemala believed that it might 
potentially affect some 70% of exports of palm oil from Guatemala to the EU , given that the measure 
set out a disincentive to use palm oil as a sourc e of fuel, a disincentive not applied to other vegetable 
oils. In Guatemala, the palm oil industry generated some 28,000  jobs directly , in particular in rural 
areas of the country. Guatemalan production was recognized around the world , given that it had the 
highest productivity level , and also result ed from  an effort and a commitment by producers in the 
country to meet sustainability goals and good agricultural practices , thus ensuring the sustainability 
of their production. From March  2017 to February  2018, a number of palm oil-producing countries, 
including Guatemala, had sent communications  to the President of the European Parliament, the 
European Commission, and the European Council. However, those complaints appeared not to have 
been taken into consideration . Indonesia reiterated its commitment to meeting the UN SDGs , and 
supported the certification of sustainably produced palm oil as part of the Millennium Development 
Goals. Guatemala stood ready to discuss  this matter in Brussels with both the Parliament and the 
Commission . Guatemala also stood ready to discuss this matter with those EU  member States w illing 
to take into account Guatemala's arguments and to work towards the adoption of measures that 
were non-discriminatory in favour  of other vegetable oils , and that did not violate WTO  principles.  G/C/M/131  
 
- 49 - 
 
  20.14.   The delegate of Costa Rica  reiterated Costa Rica's continued interest in the proposed 
amendments  to the RED , given the ir possible trade and systemic consequences. Costa Rica had been 
monito ring closely the work that had been begun in Brussels , as well as the di scussions that had 
been held at the CT G and its subsidiary bodies . 
20.15.   The delegate of Nigeria  indicated  that Nigeria held a systemic interest in this issue.  
20.16.   The delegate of the European Union  recalled that the revision of the EU  RED had been 
discussed in a number of recent bilateral meetings between the EU and interested Members; 
moreover, the issue had also been discussed in the last TBT Committee meeting . She indicated that 
one of the o verall objectives of the Commission's proposal on the RED revision was to reduce the 
carbon footprint of the transport sector. In that context, the Commission's proposal included a 
gradual reduction of the contribution of all conventional biofuels to the E U renewable energy targets –
not only those from palm oil. The EU was aware of the concerns raised in relation to an amendment 
adopted by the European Parli ament in January  2018 as part of the legislative process ; in that 
regard, she emphasized that, on subs tance, the amendment was not intended to be a ban on palm 
oil-based biofuel s on the EU  market. Biofuels from palm oil could continue to be produced or 
imported and consumed in the EU, even if they would no longer count towards meeting the 
EU Renewable Ener gy targets. In addition , and as already mentioned by some Members, the 
European Parliament proposal adopted in January  2018 did not represent the final outcome of the 
legislative procedure ; rather, that  procedure was ongoing. In the coming months, the Commission 
would continue to work closely with its co-legislators, namely , the European Parliament , and the 
Council, in the so -called "trialogues " mentioned by Malaysia. The EU stood ready to work together 
with producing countries to strengthen the sustain ability of palm oil production.  
20.17.   The Chairperson  proposed that the Council ta ke note of the statements made.  
20.18.   The Council so agreed . 
21  CHINA – MEASURES RES TRICTING THE IMPORT OF SCRAP MATERIALS – REQUEST 
FROM T HE U NITED STATES  
21.1.   The Chairperson  informed the Council that, in a communication dated 12  March  2018, the 
delegation of the U nited States had requested the Secretariat to include th is item on the agenda.  
21.2.   The delegate of the United States  expressed her countr y's concern over China's measures 
notified on 18  July 2017 to the TBT  Committee, and their subsequent implement ation banning or 
severely limit ing the import of scrap materials (CHN 1211 and 1212 ). The notified measures banned 
the import of scrap post -consumer plastics, mixed paper, and textiles , and set new border inspection 
and identification rules for materials Ch ina classified or qualified as "waste" . China had implemented 
these measures on 31 Decembe r 2017. On 15  November  2017, China had also notified CHN  1224 
to 1234 restricting the import of a variety of scrap materials through revised quality parameters ; 
the commodities covered included industrial plastics, paper and paperboard, non -ferrous scrap and 
wire, ferrous scrap and wire, and metal and el ectrical appliance scrap , among others. These new 
barriers had entered into force on 1  March  2018. In many cases, the new quality parameters were 
technically infeasible and as a result acted as a de facto  ban on the import of many scrap materials.  
21.3.   In sum, those measures outright banned or effectively banned imports of scrap materials that 
were destined for recycling and reuse in downstream manufacturing processes. China's import 
restrictions on recycled commodities had caused a fundamental disruption in glo bal supply chains 
for scrap materials , directing them away from productive reuse and towards disposal. While the US 
recognized and appreciated China's interest in addressing environmental concerns, including 
potentially by pursuing measures to improve its management of recovered scrap materials, the 
approach that China was taking appeared to be having the opposite effect. The US had observed 
that these new barriers had entered into force without any reasonable time interval during which 
industry could make the necessary adjustments to their supply chains. As the world's largest 
processor of scrap materials, China's implementation of these measures had had an immediate and 
negative impact on global recycling networks. Further, the abrupt implementation of the  measures 
had created a global shortfall in recycling capacity that had diminished supply in valuable recycled 
commodities, placing upward pressure on commodities prices for both v irgin and non -virgin 
materials.  G/C/M/131  
 
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  21.4.   The delegate of the European Union  shared US  concerns over China's measures in the context 
of China's national treatment obligations. For a vast number of materials outlined in China's ban and 
import control standards, China had no mandatory commensurate domestic standard in place. The 
EU was concerned both with the broadly trade -restrictive nature of the import control measures and 
with the apparent fundamental differences between requirements for foreign and domestic 
commodities , and requested that China immediately halt the implementation of these measures or 
at least revise them in a manner consistent with existing international standards for trade in scrap 
materials, which provide a global framework for transparent and environmentally sound  trade in 
recycled commodities.  
21.5.   The delegate of Canada shared the concerns raised by previous speakers about the 
uncertainty and disruptions that China's restrictions on the import of solid waste were creating for 
traders. Canada had also raised the issue at the TBT and Import Licensing Committees and was now 
also raising its concerns at the CTG . Canada did so because it had observed in China a range of 
measures with related objectives that cut across multiple subsidiary bodies of the CTG. Indeed, o n 
1 March  2018, China had implemented revised standards tha t had imposed stricter requirements on 
imported waste and scrap. At the same time, it appeared that China had sharply reduced the 
available import quotas for products subject to the applicable standards. Numerous Canadian and 
international stakeholders in the metal, plastic , and paper recycling sectors had raised their concerns 
over the revised standards and the drastically reduced quotas issued for imports of recyclable 
materials. These measures appear ed to be more trade restrictive than necessary to fulfi l China's 
legitimate environmental protection objectives. Canada was also concerned that China's prohibition 
of imports of recyclable post -consumer plastics was unnecessarily trade  restrictive. While Canada 
recognized China's right to address its environme ntal concerns in relation to imports of solid waste, 
China's recent restrictions severely curtailed legitimate and mutually beneficial trade in valuable 
scrap commodities. Furthermore, research had found that the environmental imprint associated with 
the u se of recyclable materials was significantly lower than that associated with the use of new 
materials. Canada encouraged China to ensure that any trade measures implemented in pursuit of 
its objective to limit harmful environmental impact would be the le ast trade restrictive possible.  
21.6.   The delegate of Australia  stated that his country appreciated China's efforts to reduce pollution 
through a broad range of measures. However, the Australian Government had a number of  concerns 
about China's measures on certain waste and scrap imports, and supported the comments  made by 
previous speakers . The measures would have a significant impact on Australian exporters, and might 
cause a large amount of waste to go to landfill, inst ead of being recycled in China and recovered for 
intermediate materials. Australia would appreciate further information on what were the specific 
public health, animal or plant, and environmental protection objectives, and how these would be  
fulfilled by t he measure. Australia questioned whether the measure was more trade restrictive than 
necessary to achieve the desired objectives , and sought clarification as to what measures were 
applied to China's domestic waste products, how such measures were enforced , and if the domestic 
waste contamination standards were the same as those  for foreign waste . If not, then what were 
the reasons for such different standards.  Australia urged China to reconsider the se standards and to 
allow for a comprehensive consultation process.  
21.7.   The delegate of the European Union  said that the EU shared the environmental objectives of 
China that were behind this measure. However, the short time period provided for the entry into 
force of China's measures would have a counter -productive ef fect in the short term. Indeed, the 
scheduled exports to China would be rerouted to third  countries that m ight not have adequate 
facilities for safe recycling, or end up in landfill or incineration, thus resulting in a negative impact 
on the global environ ment. A more reasonable time-period would be necessary in order to avoid 
such undesirable effects. Furthermore, the short time period did not allow for a discussion in the 
TBT Committee of the notified measures, including comments on the lack of clarification in relation 
to the  products affected, the science -based justification for the measures, in particular contaminant 
levels, the possible alternative measures available to fulfil the same environmental goals , and the 
application of similar measu res to domestic production. The EU sought clarification on how the 
implementation was being controlled and with regard to all the relevant customs procedures.  
21.8.   The delegate of Japan  expressed Japan's interest in this issue and stood ready to discuss the 
issue further with China and other interested Members.  G/C/M/131  
 
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  21.9.   The delegate of the Republic of Korea  register ed Korea's interest in China's measures on scrap 
materials. His delegation would need more time and information to analyse the impact  of these 
measures but would closely monitor all future developments.  
21.10.   The delegate of New Zealand  shared the concer ns and interest s of other Members on this 
issue and looked forward to being updated on it.  
21.11.   The delegate of China  said that the issue had been discussed on multiple occasions , including 
very recently at the TBT  Committee , where  a thorough discussion of the technical aspect s of the 
measure had taken place. He reiterated that the environmental protection purpose of the measure 
on solid waste treatment and disposal was a shared environmental issue faced by all countries 
around the world. In accordance with internationally recognized principles of waste generator 
responsibility and disposal to the nearest, every country had the obli gation to dispose of its 
domestically generated solid wastes. China, as the developing country with the largest population, 
might understandably make the inevitable choice of restricting and prohibiting imports of solid waste 
while improving domestic solid  waste treatment and disposal. While China still welcomed the normal 
trade flow in raw materials processed out of solid waste, the import of solid waste would be strictly 
controlled and regulated in order to safeguard environmental,  safety, and human health. 
21.12.   China was currently seeking a path towards modernization that would ensure the 
harmonious co -existence of human beings and nature. In the adjustment process of relevant 
policies, the Chinese Government would take into full consideration the demands of  domestic and 
international communities, coordinate economic growth and environmental protection, balance trade 
and non -trade interests, safeguard a smooth transition policy , and fulfil its transparency obligations 
under the WTO. On the US  intervention, h e requested further information concerning the exact 
standards that the US was referring to , so that China could evaluate them further. With regard to 
the issue of National Treatment, his delegation was not entirely sure if this discipline applied to 
rubbish.  Regarding Australia's reference to landfill sites in Australia, this was not the right f orum  to 
discuss the issue. If there were international standards to be followed, h is delegation stood ready to 
discuss them. 
21.13.   The Chairperson  proposed that the Council take note of the statements made.  
21.14.   The Co uncil so agreed . 
22  IMPORT LEVY BY WTO M EMBERS OF THE AFRICA N UNION – REQUEST FR OM THE 
UNITED STATES  
22.1.   The Chairperson  informed the Council that, in a communication dated 12  March  2018, the 
delegation of the United States had requested the Secretariat to again include this item on the 
agenda.  
22.2.   The delegate of the United States  commented that it was necessary once again to raise the 
trade -related aspects of the African Union's Decision, unanimously adopted by me mber States in 
July 2016, in Kigali, for African Union  members to finance 100% of the African Union's  operational 
budget, 75% of the program budget, and 25% of the African Union's  Peace Fund by 2020. While the 
US supported the African Union's self -financin g initiative, including its efforts to fund 25% of the 
African Union's  Peace Fund, the US did not support the use of trade measures to fund that decision. 
To generate funds to implement the Kigali Decision, some African Union members were already 
implement ing new country -specific import levies and others were contemplating doing so. These 
levies in all probability contravened African Union Members' WTO  obligations. Based on its latest 
information, the US had noted that the countries that had already started  collecting the 0.2% levy 
were the following : Cameroon, Chad, Côte d'Ivoire, the Democratic Republic of the Congo, Djibouti, 
Ethiopia, Gabon, the Gambia, Guinea, Kenya, Morocco, Rwanda, Sierra Leone, and Sudan. 
Additionally, Benin, Ghana, Malawi, and Seneg al, had also initiated internal legal and administrative 
processes to allow for the implementation of such a levy.  
22.3.   The more than 40  African Union members that already belonged in the WTO , and the nine 
that were in the process of acceding , needed to apply a ny funding mechanism, including an import 
levy, in a transparent manner that adhered to all existing WTO  commitments. At the CTG, the US 
had repeatedly requested transparency from African Union  members but had unfortunately been G/C/M/131  
 
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  given none –and now there we re countries applying non -transparent levies against US  exports. Her 
delegation asked the African Union WTO  Members applying a levy when they would provide the 
relevant details to the CTG. The US would continue to raise the issue, as appropriate, at various 
venues –including the General Council, country TPRs,  and WTO accession negotiations –until they 
could be sure that all African Union  WTO Members were abiding by their WTO  obligations.  
22.4.   The delegate of Japan  continued to express Japan's support for the  objective of the African 
Union's peace support operations , which encouraged Members to pursue self -assisting efforts to 
further contribute to the funding  necessary . However, the implementation status of the African 
Union  decision on the 0.2% levy was not clear, and Japan was concerned that, depending on how 
the levy was implemented, it could be inconsistent with the WTO Agreements. Japan requested the 
relevant Members to provide detailed information regarding the current status  of the levy, and its 
expecte d implementation decision , in a manner consistent w ith the WTO Agreements.  
22.5.   The delegate of the European Union  said that the EU strongly supported the purpose and 
cause of the 0.2% levy  for the African Union to finance its activities and support African cou ntries. 
However, the EU would appreciate more information about the process. They expected that some of 
the African Union Members would provide information on their intentions in terms of implementation 
or on the measures that they had already adopted, if this were the case. The EU attached utmost 
importance to transparency and had encouraged African WTO  Members to notify the measures in 
question, which had to be WTO  compliant.  
22.6.   The delegate of Canada  supported the efforts of African Union members to increas e African 
resource mobilization to fund the operations and program mes of the African Union. Like African 
states themselves, Canada would like to see sustained, predictable , and flexible funding mechanisms 
identified to support African Union peace and secur ity efforts, including peace support operations. 
In that regard, Canada was encouraged by Africa's efforts to self -finance African Union activities, 
particularly the African Union Peace Fund. Canada was also pleased to support Africa's regional 
integration  and free trade efforts. And it likewise welcomed the signature of the African Continental 
Free Trade Area the previous week in Kigali. Canada was keen to continue to grow trade with Africa 
and encouraged African countries to maintain trade -friendly polici es and regulations with their 
foreign partners. In that regard, Canada  encouraged African Union member states to begin 
discussions with other WTO  Members to ensure that any funding mechanism that was or would be 
implemented was transparent and consistent w ith WTO  obligations. Canada remained interested in 
receiving an update from the African Union WTO Members  on the implementation of the i mport levy.  
22.7.   The delegate of Norway  expressed Norway's systemic concerns regarding this  issue. It was 
the responsibility of all WTO  Members to act in a transparent and predictable manner and to ensure 
that their respective trade laws and practices complied with WTO  rules and ob ligations.  
22.8.   The delegate of South Africa  said that , on behalf of t he African Group, South Africa had taken 
note of the statements made and would convey these to the African Union.  
22.9.   The Chairperson  proposed that the Council ta ke note of the statements made.  
22.10.   The Council so agreed . 
23  UNITED STATES  – SAFEGUARD MEASURE S AGAINST IMPORTED CRYSTALLINE  
SILICON PHOTOVOLTAIC  CELLS AND RESIDENTI AL WASHERS – REQUEST  FROM CHINA  
23.1.   The Chairperson  informed the Council that , in a communication dated 12  March  2018, the 
delegation of China had requested the Secretariat to include this item on the agenda.  
23.2.   The delegate of China  wished to raise a number of questions with regard to this  item, 
commenting at the outset that safeguard  measures targeted fair trade and had to be used with great 
caution. He went on to point out certain flaws in the US 201 investigation.  
23.3.   First, China had noticed that almost all of the important data had been restricted as 
confidential information by the US in these two 201  investigation reports, and this was  not in line 
with the Agreement on Safeguards. In particular , the information of evidence against the safeguard 
measures had either been redacted or replaced with asterisks for all the relevant figures. Second, G/C/M/131  
 
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  how did the US determine that the "such increased quantities" (the imports surge) in the report 
were in accord ance with Article  XIX of the GATT and the Agreement on Safeguards? What was the 
calculation method or formula? Why was there only quantitative analysis but an absence of 
qualitative analysis in the reports? And how did the US prove that the import growth o f related 
products was urgent, sudden, and obvious? Third, which indicators were evaluated by the US with 
regard to the determination of "serious injury"? Why were some other factors not considered in the 
report, such as possible other causes for domestic companies' bankruptcy, such as the domestic 
demand which could not be fulfilled by the limited capacity of the domestic industry, and the impact 
of the global market downturn?  Fourth, how did the US prove that there was a causal link between 
increased impo rts and injury to the domestic industry? How did the US take into consideration the 
fact that the Suniva company, the applicant of the CSPC  201 case, had experienced a deterioration  
in its business,  while the company had not actually produced any products since its operation? Fifth, 
the US did not discuss the "unforeseen developments" in the 201  investigation report of the Large 
Washing Machine, which was obviously not in line with GATT  Article  XIX and the Agreement on 
Safeguards. Sixth, the export volume o f Chinese -related products to the US had sharply decreased 
due to the existing anti -dumping and countervailing measures taken by the US against China, in 
particular, the export volume of Large Washing Machines had dropped to de minimis  levels . Given 
these facts, why did the US not exclude China from safeguard measures in accordance with Article  9 
of the Agreement on Safeguards? And when would the US implement the procedure of elimination?  
Seventh, and lastly, would the US publish the relevant industrial adj ustment plan and , if so, when 
would it be announced? Which US department would be in charge?  
23.4.   The delegate of the European Union  expressed its deep concern over the US  use of 
safeguards. The US had not used this instrument in almost 15  years. The WTO  criter ia for imposing 
safeguard measures were very strict and the EU doubted that they had been met, either in the solar 
panels' case or in the case regarding residential washing machines. Safeguard measures targeted 
imports from all sources, including those tha t were not causing any injury, which was the case of 
EU imports. The EU represented less than 2% of total US  imports and imports from the EU had much 
higher prices than imports from Asia. In addition, it was likely that the US  measures would create 
trade d iversion and disrup t markets, including in the EU.  
23.5.   The EU had carried out consultations under Article  8 of the Safeguard Agreement with the 
US authorities. They had tried to achieve a less penalizing measure, such as a quota allocated by 
country or a minim um import price, but without success . The US had also turned down the EU's 
request for compensation. Both countries had agreed to monitor trade flows and to continue the 
discussion. The EU urged the US to refrain from taking any other broad ly trade-restrictive actions 
and to revert instead to more proportionate trade defence measures that cause d less collateral 
damage.  
23.6.   The delegate of Switzerland  said that Switzerland was deeply disappointed by the US decision 
to impose safeguard duties on crystallin e silicon photovoltaic cells, a decision that was also affecting 
producers in Switzerland. Switzerland's solar industry was not subject to any subsidy program me, 
and its limited exports were hardly in competition with US  producers. Switzerland requested th e US 
to reconsider both these measures and their application.  
23.7.   The delegate of the Republic of Korea  said that Members' common understanding was that 
safeguard measures were to be taken only with great caution and only to the extent  necessary . In 
that regar d, Korea was not convinced that the US  safeguard measures against washing machine s 
and solar panel s were consistent with the relevant WTO  rules. Korea had held a bilateral consultation 
with the US pursuant to the relevant article of the Safeguard Agreement  and continued to look 
forward to hearin g good news on this issue in the near future.  
23.8.   The delegate of Malaysia  said that Malaysia had formally requested a consultation with the 
US under Article  12.3 of the SCM  Agreement , and looked forward to engaging with  the US 
constructively towards a mutuall y agreed solution of the issue.  
23.9.   The delegate of Singapore  said that the US safeguard measure on CSPV  Cells had impacted 
Singapore companies significantly. Imports of particular CSPV  cell products were a necessary 
complement to domestic production to support the booming US  solar industry. The broad -based 
safeguard measure would dampen the growth of the US  solar industry and result in increased cost 
to consumers, particularly for those CSPV  products that were not produc ed domestically. Singapore 
had undertaken bilateral consultations with the US pursuant to Article  12.3 of the WTO  Safeguards G/C/M/131  
 
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  Agreement and had found those bilateral consultations held to date  useful . Singapore looked forward 
to a solution to the issue  that would  ensure minimal disruption to trade.  
23.10.   The delegate of the United States  responded that, as had been indicated in its notifications 
to the Committee on Safeguards, the US  International Trade Commission had reached separate 
affirmative determinations that certain crystalline silicon photovoltaic cells, whether or not 
assembled into other products, and large residential was hers, were being imported into the US in 
such increased quantities as to be a substantial cause of serious injury, or threat of serious injury, 
to the domestic industry producing a like or directly competitive article. For solar products, the 
measure went into effect on 7 February  2018, and would last for four  years in the form of a tariff 
rate quota. For each year, measures would not be applied on the first  2.5 gigawatts of cells, with a 
tariff to be applied outside the quota. The tariff to be applied woul d be progressively liberalized on 
an annual basis.  
23.11.   For large residential washers, the measure also went into effect on 7 February  2018, and 
would last for three  years and one day, with separate duty rates for large residential washers and 
parts. For each y ear, parts would be subject to a tariff rate quota and measures that would be 
progressively liberalized on an annual basis. The tariffs for washers would also be liberalized on an 
annual basis. The President had excluded certain countries from the se measur es, because: ( i) they 
were WTO  developing countries, whose share of total imports of the products concerned, based on 
a recent representative period, did not exceed 3%, provided that imports that were products of all 
such countries with less than 3% import  share collectively account ed for not more than 9% of total 
imports of the product; ( ii) they were non -WTO Member developing countries that met the same 
criteria; or ( iii) their imports neither accounted for a substantial share of total imports nor 
contrib uted importantly to the serious injury or threat of s erious injury found by the ITC.  
23.12.   The US offered and had conducted consultations under Article  12.3 of the Safeguards 
Agreement with all Members that had requested such consultations, and had begun jointly to notify 
to the CTG the results of those consultations. They expected to complete the notification s of these 
consultations in the coming weeks. The measures were a result of absolute increases in imports, 
and all of th e steps taken by the US were consistent with its obligations under GATT  Article  XIX and 
the Agreement on Safeguards. Responses to all of the questions raised by Members at this meeting 
could probably already be found either in the ITC's determination or in  the US's WTO  notifications. 
These measures would also be reviewed by the Committee on Safeguards at its end -April meeting . 
For any outstanding responses, delegations were requested to provide their questions in writing to 
be forwarded  to Capital.  
23.13.   The Chairperson  proposed that the Council ta ke note of the statements made.  
23.14.   The Council so agreed . 
24  WORK PROGRAMME ON EL ECTRONIC COMMERCE  
24.1.   The Chairperson  recalled that Ministers in Buenos Aires had adopted the  decision contained 
in document  WT/MIN(17)/65 on the  "Work Programme on Electronic Commerce" (Work Programme , 
or WPEC). In that Decision, Ministers had agreed to continue the work under the existing Work 
Programme since their last session, based on the  existing mandate as set out in 
document  WT/L/274 , adopt ed on 25  September  1998, and endeavour to reinvigorate the work of 
the WTO on electronic commerce (E -Commerce). To this end, the Decision had also instructed the 
General Council to hold periodic reviews in its sessions of July and December  2018, and July  2019 
based on the reports submitted by the relevant bodies, among them the Goods Council; and to 
maintain the current practice of not imposing customs duties on electronic transmissions. To fulfil 
the renewed mandate, the E -Commerce issue had been included as a stand -alone agenda item and , 
in this vein, the Chairperson invited delegations to continue to express their opinions and to make 
suggestions as to how to work in the future. He also informed Members of two non -papers that had 
been tabled by Chinese Ta ipei. 
24.2.   The delegate of Chinese Taipei , when introducing its two submissions, circulated in 
documents  JOB/CTG/12 and JOB/CTG/13, indicated that JOB/CTG/12 referred to cyberspace trade 
barriers, and that it identified quantitative and fundamental differences between E -Commerce and 
traditional trade. One such difference was the so -called atoms/bits transformation in the digital G/C/M/131  
 
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  world, where it was observed that hindering the flow of bits could have similar or even greater trade -
restrictive effects than traditio nal trade barriers on atoms. In this regard, the term "cyberspace trade 
barriers" had been employed to describe the intervention by governments in the cross -border 
transmission of information by electronic means, which had a restrictive effect on internati onal trade. 
The paper also suggested that the term "information" or "data" should cover all types of information 
transmitted across the internet, including any internet searching, surfing, and communications, 
made between potential online buyers and seller s. She highlighted that , to secure the free flow of 
information among Members across the internet, and to ensure that all Members had the right to 
access each other's network , was essential. Thus, trade opportunities would be fully available to all 
potenti al participants, especially SMEs.  
24.3.   Regarding JOB/CTG/13, she indicated that it shared observations on 3D  printing and the 
shared economy. In this vein , she noted that most "digitizable" goods were already being traded 
online and many of the transactions wer e bypassing traditional border controls. The advent of 
3D printing had made it possible for a digital blueprint to be sent electronically, from one country to 
anywhere in the world, and the physical products to be locally manufactured in the consuming 
country, by a 3D  printer. She went on to note that such goods would therefore be identified as local 
products and it was not clear how GATT  rules, which dealt with border measures, would apply to 
these new trade and manufacturing patterns. She invited Members to further explore the issues 
arising from these new E -Commerce trading patterns and encouraged them to address any possible 
asymmetric regulatory treatment that could lead to a business environment of unfair competition 
between new and traditional trading  measures and models.  
24.4.   Chinese Taipei hoped that these technical papers would clarify certain of the fundamental 
issues in E-Commerce and facilitate future discussion at the WTO, and looked forward to engaging 
with all interested Members on these and other topics.  
24.5.   The delegate of Japan  thanked Chinese Taipei for their contribution and recalled that , in 
Buenos Aires , Ministers had agreed to continue the work based on the Work Programme and to 
reinvigorate the E -Commerce discussions at the WTO. Japan believed that the two  Chinese Taipei 
submissions were consistent with the direction agreed  upon by consensus in Buenos Aires. On trade 
in physical goods in E -Commerce, Japan considered that the Trade Facilitation Agreement (TFA) 
could address some of the challenges  relating to how countries were dealing with the increasing 
flows of low -value parcels. They suggested that the Committee on Trade Facilitation (CTF) should 
address this issue through a robust implementation of the TFA. In this vein, Japan would be activel y 
engaged in the work of the CTF.  
24.6.   The delegate of Norway  stated that the Decision from Buenos Aires to continue work under 
the Work Programme signalled an interest and willingness among Members to advance the WTO's 
work in the area of E-Commerce. Norway was appreciative of the fact  that a number of submissions 
had been put forward and that useful discussions had taken place in various Committees. She also 
thanked Chinese Taipei for their two  technical papers , and expressed the hope that further papers 
on E-Commerce would be submitted  in due course . 
24.7.   Norway believed that it would be useful for WTO Members to seek common elements in their 
respective submissions, especially concerning the necessary conditions for E -Commerce to work to 
the benefit of all, not l east, and especially , in terms of the potential advantages for developing 
Members. Norway would remain actively engaged in following -up on the Work Programme, and 
would also take an active role in the Joint Statement on Electronic Commerce initiative, and 
encouraged all interested Members to proceed in the same way . 
24.8.   The delegate of Panama  thanked Chinese Taipei for its technical papers and indicated that, 
as co -sponsors of the proposal on electronic commerce and development, contained in 
document  JOB/CTG/5,  Panama placed  a high level of interest in these topics.  
24.9.   Panama considered that electronic commerce facilitated transactions and had a great potential 
for global growth. According to UNCTAD  estimates, E -Commerce in Latin America would grow by an 
average of  17% annually, until 2019. In addition , electronic commerce would allow access to new 
markets and provide exponential opportunities to all types of sellers. Nevertheless, micro, small , 
and medium -sized enterprises (MSMEs) faced important challenges in orde r to harvest the full 
benefits of E-Commerce , espe cially in developing countries.  G/C/M/131  
 
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  24.10.   Latin American MSMEs played an important role because of  their contribution to employment 
and the overall economy. In this regard, it was important to identify solutions that  would support 
greater integration of MSMEs into international trade through the use of technology. He noted that 
MSMEs required training, access to adequate infrastructure, access to global markets , and non -
discrimination of E -Commerce transactions . In ad dition, electronic commerce would allow micro -
sellers to have an almost unlimited growth potential if the right channels and incentives were in 
place. Notwithstanding the above, Panama recognized that challenges persisted in the area of 
facilitating  the us e of E -Commerce by the most vulnerable agents in the economy. Consequently, 
Panama considered it important to discuss E -Commerce at the CTG and to continue to work on the 
Work Programme.  
24.11.   The delegate of Cuba welcomed the resumption of discussions under the Work Programme 
and appreciated recent contributions by Members. Cuba believed that it was relevant to discuss 
E-Commerce in a multilateral forum, as had been agreed by Ministers in Buenos Aires, an d therefo re 
recognized the 1998  Work Programme as the only mandate. On that basis, her delegation remained 
ready to continue working in a con structive manner on this issue.  
24.12.   Document  JOB/CTG/12 indicated that land -locked countries and small and medium -sized 
enterpri ses (SMEs) had benefited more from electronic commerce than developed countries and 
large multinational companies ; she requested evidence supporting such assertions and asked how 
such benefits were measured, particularly as Cuba had had no such experience in this regard. Cuba 
considered it chimerical to imagine that SMEs in developing countries could sell directly to consumers 
in developed countries, under improved competition conditions, in large part due to technological 
limitations. She also expressed co ncern over the abuse in recent debates of the idea that 
E-Commerce provided greater benefits to SMEs than to large com panies and developed countries.  
24.13.   Cuba believed that cyberspace was an integral part of each State, such as land, maritime , 
and aerial space , and thus that, based on sovereignty principles, it should be governed by national 
legislation. With regard to the reference made to public intervention in cyberspace and the impact 
on providers, she requested concrete examples of the type of intervention  being referred to, and 
how it produced such an effect on providers. She also questioned if the very legitimacy of such 
intervention s had been taken into consideration in the analysis. Cuba believed that rules on online 
activities should always correspond to the development plans and programmes of each country. 
Therefore, governments should rightly have the authority to intervene in their internet traffic. While 
it was possible to facilitate the free movement of data flows, such flows should be  regulated  
according to the economic and security interests of each nation. The delegate stated that it was 
necessary to recognize the right s of Members to regulate activities through the identification of the 
scope of legitimate public policy objectives that would jus tify cyberspace trade barriers.  
24.14.   As for an open and free internet, Cuba was in favour of democratic and participatory 
governance that should be based on centralized regulation, and considered that the technological 
neutrality of GATS had not achieved consen sus among Members and remained a topic under 
consideration in the Counc il for Trade in Services (CTS).  
24.15.   With regard to the comments on future work and suggestions, Cuba believed that it was 
premature to decide on the proposals discussed during the meeting, and that additional debates and 
taking stock of how other international organizations were dealing with the electronic comm erce 
issue were also important.  
24.16.   She indicated that any analysis on E -Commerce should be based on the recognition of the 
digital divid e, which was real and widening. Chinese Taipei, in its document, accurately recognized 
the importance of internet access as a fundamental and necessary condition to taking part in 
electronic trade. Nevertheless, half the global population did not have the benefit of such access, or 
only to an extremely limited  extent . She therefore invited Members to reflect collectively on how to 
address this issue because, in Cuba's view, precipitating the establishment of rules would only 
perpetuate the current imbalances, which Cuba could certainly not afford. Cuba looked forward to 
its continued and  constructive participation in these discussions.  
24.17.   The delegate of South Africa  also thanked Chinese Taipei for its submissions and recalled 
that South Africa  had already provided substantive comments  on such papers at the CTS on 
2 March  2018. However, she wished still to share the following preliminary remarks at the CTG  level: G/C/M/131  
 
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  (i) if the assertions on paragraphs  1.1 and 1.2 of JOB/CTG/12 were accurate, the be nefits of the 
internet to international trade had already occurred , and thrived in the absence of rules. With regard 
to paragraph  1.2, in particular, she indicated that it would be useful to have access to the re search 
cited in the paper; (ii)  that the int ernet had created favourable conditions that benefitted  big 
companies in developed countries more than MSMEs in developing countries, at least in absolute 
terms. The figures showed that, while the relative growth might have been higher for MSMEs in 
develop ing countries, it paled in comparison to the absolute growth, revenue , and market 
capitalization of the largest companies in developed countries. In fact, when the numbers were put 
into perspective, the wealth of such companies outstripped the economi es of many countries; and 
(iii) the asymmetry in the existing global digital environment posed an important challenge for 
inclusive and sustainable growth and development. According to South Africa, the paper had made 
a number of broad assumptions that could no t be taken as given.  
24.18.   On suggestions for future work, she said that the papers from Chinese Taipei had leapt to 
conclusions about securing the free flow of information among Members across the internet and in 
terms of ensuring that all Members had an unequi vocal right to access each other's network on a 
reciprocal and equal basis. She also indicated that , the suggestion that there be an even more 
restrictive approach to general exceptions, namely, that these should be measures taken in 
"exceptional circumsta nces" , and explicitly agreed upon by Members, seemed in fact to go against 
the perceived flexibility offered by general and security exceptions in the WTO Agreements. This 
position equated to a necessity test to achieve legitimate policy objectives.  
24.19.   She al so emphasized that a meaningful debate on E-Commerce trade -related issues under 
the Marrakech Agreement required the prior establishment of international norms, principles, and 
rules on competition, anti -trust, abuse of market power, platform dominance, an d taxation of the 
cyber economy. However, several of these issues could not be negotiated at the WTO because they 
concerned areas not related to trade, but rather to human rights law, tax law, and anti -trust law. 
Consequently, the WTO should only become in volved once agreements had been reached in the 
relevant international bodies that dealt with those aspects of international law , and its involvement 
should be limited to trade.  
24.20.   South Africa also questioned the sequencing of the two  submissions , given that Chinese 
Taipei had highlighted the importance of discussing the economic implications of international cyber -
transactions, notably taxation , but without there being any broader discussion, and the data flow 
question was pre -empting such a discussion , and was therefore premature. Within the context of 
paragraph  1.3 of the Work Programme, South Africa remained ready to engage in a deeper 
discussion at the CTG on these issues, and reaffirmed its commitment to do so within the multilateral 
framework estab lished by the Work Programme.  
24.21.   The delegate of China  recalled that the Work Programme mandated Members to discuss 
trade -related aspects of E -Commerce, which differed from concepts such as digital trade and 
cyberspace trade barriers used in communications. C hina hoped that Members would focus their 
discussion within the current WTO  mandate and noted that the submissions also recognized 
Members' right s to regulate online activity. Given the increasing popularization of and reliance on 
the internet, cybersecuri ty was becoming an ever more important issue. The threat of internet 
viruses, rogue programmes, and phishing software had already caused severe damage to China's 
cyberspace and data security, which in turn had led to information and asset losses of interne t users 
globally.  Therefore, China believed that it was essential for governments to regulate cross -border 
data flows and to guarantee a sustainable and healthy development in the area of E-Commerce. 
These regulations were also commonly used to achieve var ious national policy objectives by 
Members, which were not related to trade. China encouraged Members to consider the need for 
cross-border data flows in the era of economic globalization, and to find a balance between 
cybersecurity and guaranteeing data f lows as, in its view, it was legitimate for Members to design 
regulatory measures in line with their specific conditions and needs so as to protect the interests of 
their people.  
24.22.   China was also of the view that the evolution of the internet and economic gl obalization had 
created the need for cross -border data flows, and had also brought challenges to cybersecurity and 
personal information protection, which should never be ignored. Guaranteeing these aspects should 
therefore be preconditions for legal and op en data flows, and inclusive and sustainable trade growth.  G/C/M/131  
 
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  24.23.   The delegate of Chinese Taipei  thanked the previous speakers for their interventions and , in 
response to questions by Members, clarified that the papers had been based on the results of publicly 
available investigations. Her delegation remained open and eager to engage with interested 
Members on these and other issues. Given the importance of E-Commerce to global economic 
growth, it was relevant that Members kept exploring any possibility and discussion under the 
framework of the 1998  Work Programme.  
24.24.   With regard to possible future CTG work on E -Commerce, the delegate of China  recalled 
that, before MC11, Mem bers had submitted more than 30  communications on this issue, and had 
undertaken extensive discussions of the  matter. Meanwhile , Members like the Friends of 
E-Commerce and Development (FED), Mexico, Indonesia, Korea, Turkey,  and Australia (MIK TA) and 
the African Group, had held a number of seminars on E -Commerce in Geneva, which had contributed 
to a better understanding of the particularities of E -Commerce, especially its development 
dimension. China appreciated Members' efforts to support the MTS, particularly as these efforts  had 
contributed towards the Ministerial Decision in Buenos Aires, requiring Members to "continue the 
work under the Work Programme on Electronic Commerce".  
24.25.   China had consistently valued and supported multilateral discussi ons on E -commerce. As 
reiterated in 2017, it considered that E -commerce helped the WTO to remain relevant and responsive 
to the needs of businesses, and helped MSMEs, women and young people from developing Member 
countries, to participate in global trade a nd benefit from the inclusiveness of the MTS. He indicated 
that, following MC11, Members should maintain the momentum for multilateral discussions on the 
trade -related aspects of E-Commerce , and reflect innovatively on efficient approaches that might 
allow Members to move these discussions  forward , and which should give appropriate consideration 
to Members' different development stages , as well as the developing Members' needs, in particular 
the LDCs. In this regard, he encouraged Members to submit constructive suggestions  to the CTG , 
and urged the WTO to enhance its cooperation with such international organizations as the World 
Customs Organization (WCO) and the Universal Postal Union (UPU) , with a view to exploring the 
development dimension of E -Commerce, and to exchanging relevant research outcomes.  
24.26.   He recalled that , in the past two  years, Membe rs had discussed the issue of E -Commerce 
under the relevant WTO  bodies , and had submitted several proposals suggesting, among other  
matters , that the issue of internet -enabled trade facilitation in goods  be further discussed , as well 
as related services such as payment s and logistics services. Th e exchange of experiences on this 
issue had prove n to be helpful to Members, and was worthy of further discussion at the CTG.  
24.27.   He stated that , in light of the rapid development of E -Commerce globally, many international 
organizations had been involved in re levant discussions of this new business model. In 
February  2018, the First Global Cross -Border E -Commerce Conference, jointly organized by the WCO 
and the General Administration of Customs of China (GACC), had been convened in Beijing. Nearly 
2,000  delegat es from the WCO  Member Administrations, other government agencies, international 
organizations, and business and academic societies of 145  countries and regions, had attended the 
conference, and had exchanged experiences on promot ing cross -border E -Commerc e. Regarding 
this event, he reported that the theme of the Conference had been an innovative, inclusive, strategic , 
and collaborative approac h to sustainable cross -border E -Commerce. The Conference had focu sed 
on panels such as "Ne w Face of Trade –How Can W e All Benefit", "Status Quo Is Not a Strategy –
What Should Be Done to Adapt Regulatory Procedures", "Transformative Technologies Driving 
E-Commerce", "New Challenge s, New Solutions", "What Next –Futuristic Vision", "Leveraging the Belt 
and Road and Other Ini tiatives for Balanced Development", "New Opportunities for Fostering 
Partnerships" , and "Enhancing Capacities and Facilitating E -Commerce", and had conducted in -depth 
discussions on cross -border E -Commerce from the perspect ive of customs administrations.  
24.28.   The Conference had reached general consensus on the principles of the Framework of 
Standards on Cross -Border E -Commerce, which would be the first guiding document for the 
regulation and service of cross -border E -Commerce for customs globally. The Conference  had also 
adopted the Beijing Declaration to demonstrate the consensus and vision of the customs community 
and other stakeholders regarding the development of cross-border E -Commerce.  
24.29.   In addition, cross -border E -Commerce businesses had jointly issued the "Call for Actions by 
Global Cross -Border E -Commerce Enterprises", encouraging businesses to enhance self -governance 
and self -discipline, and appealing to businesses and government agencies to work closely for 
sustainable growth of cross -border E -Commerce. The Conference had also called for the G/C/M/131  
 
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  establishment of relevant rules and standards relating to cross -border E -Commerce, with a view to 
creating a more transparent and predictable trading environment, and also promoting connectivity. 
China believed that this was also the goal of the E -Commerce discussion at the WTO. Indeed, while 
customs regulation was an important aspect for internet -enabled trade in goods, there were many 
more topics to be discussed and explored at the WTO; therefore, in order to help the Membership 
better understand the issue of E -Commerce, China encouraged the WTO to enhance its cooperation 
with such international organizatio ns as the WCO and the UPU.  
24.30.   Pursuant to the mandate o f the 1998  Work Programme on E -Commerce, C hina recalled that 
the discussion on E -Commerce by relevant WTO  bodies "should take into account the work of other 
intergovernmental organizations". Bearing this in mind, China suggested that the WTO and the WCO 
enhance its information -sharing on cross -border E -Commerce. In particular, China proposed that 
the two  organizations hold a joint seminar on E -Commerce, which could invite stakeholders such as 
relevant international organizations, experts , and enterprises , to conduct active dialogues on 
E-Commerce, introducing latest developments, experiences , and policy suggestions on cross -border 
E-Commerce, thus promoting inclusive trade growth. This joint seminar could be organized before 
end-July 2018.  
24.31.   The delegate of Argentina  stated that Members should , withou t question , focus the 
discussion on E -Commerce within the WTO, as had been decided by Ministers in Buenos Aires. In 
this regard, Argentina expressed its unbridled support for the proposal made by China regarding a 
possible E-Commerce Workshop . 
24.32.   The delegate  of Pakistan  also supported China's proposal , as Pakistan believed that there 
was positive work being done at the WCO and that this could contribute to the work at the WTO, 
especially with reference to the trade facilitation aspect of E -Commerce.  
24.33.   The deleg ate of Nigeria , as one of the co -sponsors of the E-Commerce initiative, noted and 
welcomed the effort s made by China in suggesting that the WTO and the WCO should host a seminar 
that would enhance Members' information -sharing on cross -border E -Commerce. In deed, many 
developing countries, particularly in the African region, would benefit from such an event, being the 
first of its kind to be hosted jointly by the WTO and the WCO.  
24.34.   The delegate of Costa Rica  also expressed Costa Rica's support for China's proposal of 
organizing a joint seminar, hosted by the WTO and the WCO. His delegation would also welcome the 
possibility of holding other events with international organizations that could likewise be interested 
in E-Commerce.  
24.35.   The delegate of Mexic o also considered that China's proposal was appropriate, and supported 
the initiative.  
24.36.   The delegate of the European Union  thanked China for its suggestion regarding this possible 
seminar. However, the EU looked forward to receiving more detail before takin g a final position on 
this issue. As a preliminary reaction, the EU was open to considering an event hosted by the WTO, 
in association with the WCO. However, the EU believed that the scope of the discussions for such an 
event should not be limited to goods  or services, but should rather be cross-cutting. The EU looked 
forward to receiving more information on this issue and to further discuss ion. 
24.37.   The Chairperson  concluded the discussion on the Work Programme by indicating that , 
according to the interventions  made , this issue remained very important for many delegations and 
that Members, indeed, had  been given  a renewed mandate to revitalize the work in this area. He 
indicated that he would ask the incoming Chair to consult with Members on how best to advance , 
including on the possibility of holding a seminar in the WTO with the WCO , as had been suggested 
by China. He also proposed that the Council take note of the statements made.  
24.38.   The Council so agreed . G/C/M/131  
 
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  25  OTHER BUSINESS  
25.1.   The Chairperson  recalled that , at the star t of the meeting, the delegation of China had 
indicated that it would like to raise two  issues under Other Business; one issue concerned the 
Section  301 investigation, and the other, measures to aviation security equipment.  
25.2.   The delegate of China  said that , on 22  March  2018, the US had published the final conclusions 
and measures of the Section  301 investigations against China. China firmly opposed this action by 
the US. The unilateral action of the US  Section  301 investigations would not only impair the rig hts 
and interests of China and other WTO  Members, but also seriously undermine t he multilateral trading 
system.  
25.3.   Section  301 investigations and measures were purely unilateral which were per se  prohibited 
by Article  23 of the DSU, and violated the most fund amental values and principles of the WTO. 
According to the WTO  rulings and the US  commitment, the US should by no means determine 
unilaterally , based on a Section  301 investigation , that other Members had violated WTO  rules. When 
it came to matters relatin g to the WTO  Agreements, the US should strictly abide by WTO  rules and 
the findings of the DSB. What the US had done contradicted its commitments , including  that the US 
"explicitly, officially, repeatedly and unconditionally confirmed" , before the Panel in  DS152, that the 
USTR would base a Section  301 decision only on adopted DSB  findings. The panel in DS152 also 
warned that "should the US repudiate or remove in any way these undertakings, the US would incur 
state responsibility since its law would be rende red inconsistent with the obligations under 
Article  23." 
25.4.   For a long time, the US had frequently launched unilateral investigations on the trade and 
economic policies of other countries or regions, and then implemented retaliation and sanctions such 
as raising tariffs and restricting investment for reasons of domestic industry protection. Since 1974, 
the US had launched 125  Section  301 investigations, which had affected almost all WTO Members. 
The unilateral measures of US  Section  301 ceased after the establishment of the WTO; however, 
the US was now setting a very bad precedent by bluntly breaching its previously made commitment 
to the world. WTO  Members should jointly prevent the resurrection of Section  301 investigations 
and lock this beast back into the cage of the WTO  rules. China was fully prepared to react to the 
Section  301 conclusions and measures, and would firmly take the WTO  rules and other necessary 
means to safeguard its legitimate rights and inte rests. Undoubtedly, China was facing a tough test, 
and it was prepared for the difficulties ahead. The character of China was like a bamboo, resilient 
enough to dance in the wind, but strong enough to withstand tremendous pressure. Unilateralism 
was fundam entally incompatible with the WTO, like fire and water. In the open sea, if the boat 
capsized, no one was safe from drowning. Members should not stay put watching someone wrecking 
the boat. The WTO was under siege and all Members  should lock arms to defend  it. 
25.5.   The delegate of Japan  said that his delegation was closely examining the USTR  Section  301 
Report released last week. Japan shared the US  view of the importance and of the need for stronger 
protection of intellectual property , and its effective enforce ment; Japan also shared US  concerns 
over China's requirement for disclosure of technological information and discriminatory licensing 
practices. Japan believed that any trade measure must be consistent with the WTO  Agreements and 
expected that the US would  implement such measures in a manner cons istent with the 
WTO Agreements.  
25.6.   The delegate of the European Union  said that her delegation had taken note of the US  action 
against China under Section  301 of the 1974  Trade Act. The EU fully shared the US  concerns with 
regard to the need for greater reform and market openness in China, including in relation  to its 
practices in the field of technology, intellectual property, and innovation. However, the EU was of 
the firm view that any trade actions taken should be f ully compatible with the WTO  framework, 
which provided numerous tools effectively to deal with trade differences , and called on the relevant 
parties to ensure that their tr ade actions were WTO -compliant.  
25.7.   The delegate of the United States  said that, because  China had not inscribed this item on the 
agenda, but rather had raised it under "Other Business", the US would not comment on China's 
intervention in substance or detail at that time. However, if other WTO  Members were interested in 
learning more about the US  actions under Section  301, they could refer to the USTR  website, on 
which they would find a factsheet and an extensive report. The report estimated that Chinese forced G/C/M/131  
 
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  technology transfer policies and practices were causing billions of dollars in losses annually to 
US businesses and individuals. Those Chinese polic ies or practices would also apply to other 
WTO Members. In addition, other WTO  Members interested in learning more about China's 
technology licensing practices of concern  should refer to the WTO  consultation request that had been 
filed by the US the previo us week. China appeared to be denying patent holders their exclusive 
rights to prevent unauthorized use , and also appeared to be discriminating against foreign 
technology holders through licensing requirements that did not apply to Chinese technology holde rs. 
Both of these practices appeared to breach China's obligations under the TRIP S Agreement  
25.8.   The Chairperson  proposed that the Council ta ke note of the statements made.  
25.9.   The Council so agreed . 
25.10.   On the issue of aviation security equipment , the delegate of China said that the 
Transportation Security Administration of the US (TSA) , the US government al agency responsible 
for civil aviation security , had issued criteria for minimum performance requirements  in civil aviation 
equipment (TSA  criteria) and carried out  certification of civil aviation  equipment (TSA  certification).  
25.11.   The TSA  criteria were a technical regulation in the sense of the WTO  TBT Agreement , while 
the TSA  certification was a conformity assessment procedure (CAP) under the TBT  Agreement. 
According to the TBT  Agreement, the TSA, as a conformity assessment body, should accord national 
treatment to suppliers from other Members in terms of access and rights to the certification 
procedure. However, China's civil aviation equipment manufacturers ha d been denied rights to 
conformity assessment with regard to X -ray machines for air cargo, for multiple applications in 
recent years , without any explanation and  with their enquiries going unanswered.  
25.12.   Article  5.1 of t he TBT  Agreement mandated that national treatment be granted to suppliers 
of other Members in terms of rights to assessment of conformity , and conformity assessment sh ould 
not be applied with the effect of creating unnecessary obstacles to international trade. Article  5.2 
mandated that, when rec eiving an application, the competent body sh ould promptly examine the 
completeness of the documentation and inform the applicant in a precise and complete manner of 
all its deficiencies  and, among other  requirements , inform the applicant of the stage of th e procedure 
upon request, with any delay being explained. China believed that the US had an obligation under 
the TBT  Agreement to make sure that the TSA  granted national treatment for Chinese civil aviation 
equipment manufacturers  in the certification proc ess. 
25.13.   The delegate of the United States  noted that , because China had not inscribed the item on 
the agenda but was raising it under "Other Business", the US would not comment on the intervention 
in substa nce or in detail at this meeting.  
25.14.   The Chairperson  proposed that the Council ta ke note of the statements made.  
25.15.   The Council so agreed . 
25.1  Date of the next meeting  
25.16.   The Chairperson  informed the Council that the next meeting of the Goods Council would be 
held on 3  July 2018. The agenda would close at 4.30  p.m. on 21  June 2018. With regard to the 
closing of the agenda, he reminded delegations that, according to the rules of procedure, meetings 
of WTO  bodies were convened by a meeting notice issued not less than ten  calendar days prior to 
the date set for the meeting. The agenda itself, therefore, closed one  WTO working day prior to 
circulation of the meeting notice. In other words, 11  calendar days befor e the date set for the 
meeting.  
26  ELECTION OF CHAIRPER SON OF THE COUNCIL F OR TRADE IN GOODS  
26.1.   The Chairperson  recalled th at the Chairperson of the General Council had carried out 
consultations on a slate of names for chairpersons to the different WTO  standing bodies, in 
accordance with the established guidelines for the appointment of officers. Those proposed 
nominations had  been approved by the General Council at its meeting on 7  March  2018. In line with G/C/M/131  
 
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  the nominations, he proposed that the CTG elect Ambassador Stephen de Boer , from Canada, as 
Chairperson  of the Council by acclamation.  
26.2.   The Council so agreed . 
26.3.   The meeting was  adjourned . 
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