WORLD TRADE  
ORGANIZATION  WT/REG134/5 
6 January 2005 
 
 (05-0043) 
Committee on Regional Trade Agreements Original:   English 
  
 
FREE TRADE AGREEMENT BETWEEN THE UNITED  STATES AND JORDAN 
 
Questions and Replies
 
 
 The following  communication, dated 21 December  2004, is being circulated at the request of 
the Delegations of the United States and Jordan. 
   This document reproduces the questions addressed  to the Parties and the responses submitted. 
The questions and replies set out below are or ganized in accordance with document WT/REG134/3 
for the goods aspects of the Agreement, and WT/R EG134/4 for the services aspects of the Agreement. 
  
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GOODS ASPECTS
 
 
II. TRADE PROVISIONS 1. Import Restrictions 1. Does the agreement provide for any Tariff-R ate Quotas? If yes, please specify the 
products and the percentage of trade flows covered by these Tariff-Rate Quotas?   
 The Agreement provides for transitional, pref erential tariff-rate quotas (TRQs) to be applied 
by the United States for certain tariff lines, na mely the dairy, sugar/ sugar-containing products, 
peanuts/peanut butter and cotton tariff lines th at correspond to the over-quota tariff lines for WTO 
TRQs for these items.  These preferential TRQs esta blish an initial zero-duty quantity that expands 
each year for ten years as the over-quota tariff is eliminated (in equal annual cuts over ten years).   From 2001 through 2003 (calendar years), Jord an did not export any sugar/sugar-containing 
products, peanuts/peanut butter or cotton under these pr eferential TRQs.  Jordan used the preferential 
TRQs for two dairy lines (HTSUS 04031050 and 0 4069097), exporting $3,604 in dairy products in 
2001, $25,943 in 2002, and $10,743 in 2003.   U.S. impor ts of these dairy products from Jordan are 
0.36% of total agricultural imports under the Agreem ent in 2001, 2.20% of total agricultural imports 
under the Agreement in 2002, and 0.44% of total agri cultural imports under the Agreement in 2003.   
See attached table for a full review of the trade flows in products covered by TRQs. 
 
3. Rules Of Origin 
 
2. Has the Qualifying Industrial Zone (QIZ) scheme put in place between Jordan and 
Israel under the US-Israel agreement expired upon entry into force of the US-Jordan 
agreement? If yes, does the US -Jordan agreement foresee cumulation of origin with Israel for 
Jordan exports to the US as well as for Israel exports to the US? If no, is the QIZ scheme WT/REG134/5 
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 extended to grant the same treatment to Jordan ex ports including Israel input as that granted to 
Israel exports containing Jordan inputs?    
 The Qualifying Industrial Zone program did not expire with the entry into force of the Jordan 
FTA.  The QIZ program was created in 1996 through an amendment to the authorizing legislation for 
the U.S.-Israel FTA.  The legislation creating the QIZ program did not set a time limit, therefore there 
was no need to extend the program.  Under U.S. law, in order for a QIZ article to gain duty-free entry, 
three basic requirements must be met. First, the produ ction in the QIZ must be sufficient to result in a 
new or different article of commerce that has b een grown, produced or manufactured in the QIZ. 
Second, the value added to an article in a QIZ mu st be not less than 35 percent of the appraised 
(transaction) value of the article. The 35% percen t minimum content figure can encompass the cost of 
local (Israel, West Bank, Gaza, or QIZ) material, plus the cost of U.S. materials (up to a maximum of 
15% of the appraised value), plus direct costs of  processing performed in Israel, West Bank, Gaza or 
the QIZ. Third, the product must be imported directly to the United States.   
3. According to the document WT/REG134/3 under II. 3. Rules of Origin, it is stated that 
“The Agreement’s rules of origin do not apply to processed citrus products.”   We would like to 
know what rules do apply to processed citrus products.   
 Footnote 1 to Annex 2.2 of the U.S.-Jor dan FTA provides that processing fruit imported 
under HS 0805 into fruit juices classified under HS 2009.11—2009.30 (now .39 under the 2002 HS) does not constitute a substantial transformation under pa ragraph 1(a) of Annex 2.2.  This exception to 
the “fruit forward”/substantial transformation rule only applies to fruit juices classified under HS 
2009.11-2009.30, not to all citrus products.  All othe r citrus products would be  subject to one of the 
three (3) substantial transformation tests set forth in paragraph 1 to Annex 2.2 of the Agreement. 
 
5. Safeguards 
 
4. On the question of the application of safeguard measures, Japan has always held the 
view that the parties to RTAs should not be ex empted from the application of global safeguard 
measures.  We would be interested in the views of the parties to the US-Jordan agreement on this point.   
 This question has been the topic of much de bate.  Our views remain  unchanged.  GATT 1994 
leaves the signatories to an FTA the discretion to determine to what extent they will exclude each 
other from safeguard measures.  They may structure th eir agreements to require exclusion in all cases, 
to require inclusion in all cases, or to re quire exclusion in some, but not all, cases. 
  As to the consistency with GATT 1994 of the Agreement’s provisions on safeguard measures, 
we note that a similar issue was addressed in the panel report in United States – Line Pipe, which 
found that Article XXIV of GATT 1994 permitted FTA partners to exclude each other from safeguard 
measures.
1 The Appellate Body concluded that this fi nding was moot, but it remains the only analysis 
of this question in a WTO report, and we find it persuasive.  
6. Anti-Dumping and Countervailing Measures 
 
5. On the question of Anti-Dumping and Countervailing Measures: the document states 
that “The agreement contains no provisions fo r anti-dumping and countervailing measures.”  
Does this mean that the rights and obligations  of the WTO Agreement are applicable to the 
                                                     
 
1 United States – Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line 
Pipe from Korea, WT/DS202/R, adopted on 8 March 2002, as modified, paras. 7.127-7.163.  WT/REG134/5 
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 parties to this agreement for the imposition of anti-dumping duties between the United States 
and Jordan? 
 In Article 1.2 of the Agreement, the Parties reaffirmed their rights and obligations to each 
other under the WTO agreements.  The United States  and Jordan are both Members of the WTO, and 
remain subject to their obligations to  each other under the WTO agreements. 
 
 
IV. OTHER 
6. Article 4.6 of the agreement refers to geographica l indications. What is the definition of 
geographical indications in this context? What are examples of such geographical indications? 
Footnote 8 of the agreement refers to the po ssibility to have geographical indications on 
services. What are examples of such geographical indications on services?    
 The definition of "geographical indication" as u sed in Article 4.6 is the definition set out in 
Article 22.1 of TRIPS with the addition of expressl y providing that services may also qualify for 
protection as GIs.   
  
 Examples of GIs protected in the United St ates:  VIDALIA for onions from the State of 
Georgia; FLORIDA CITRUS for fruit grown in the state of Florida; NAPA VALLEY for wine from Napa Valley, California, “BANSHU SOMEN” for noodles from Japan; “COLOMBIAN’ for coffee 
from Colombia; “DARJEELING” for tea from India; “JAMAICA BLUE MOUNTAIN” for coffee from Jamaica; “PARMA” for ham from Italy; “PARMIGIANO-REGGIANO” for cheese from Italy; 
“ROQUEFORT” for cheese from France; and “SWISS” for chocolate from Switzerland. 
   We are not aware of any geographical indication certification marks for services either in use in commerce in the United States or in Jordan, or  registered at the USPTO or at the Jordanian 
Industrial Protection Department at this time.    
   
 
7. Article 4.20 appears to strictly limit the gro unds for providing compulsory licences to a) 
remedying anti-competitive practices, b) public  non-commercial use an d use by government 
entities or under government authority in the case of national emergency or other circumstances of extreme urgency and c) failure to work (importation being considered as 
working a patent). Does this entail that the re cognition, made by the Ministers through the 
Doha Declaration on the TRIPs Agreement a nd Public Health, that "Each Member has the 
right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted" does not apply to Jordan, or  is it considered that the Doha Declaration, 
which post-dates the US-Jordan Agreement overrules Article 20 ?   
 We do not believe Article 4.20 is inconsis tent with the Doha Declaration on the TRIPS 
Agreement and Public Health. WT/REG134/5 
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 SERVICES ASPECTS
 
  
I. BACKGROUND INFORMATION ON THE AGREEMENT 
1. Membership And Dates Of Signature, Ratification And Entry Into Force. 
8. The US and Jordan are notifying the agreement as an ‘Economic Integration 
Agreement, having substantial services coverage, and providing for the absence or elimination 
of substantially all discrimination – as set out in GATS Article V. However, the US and Jordan 
are not notifying the agreement pursuant to GATS Article V.   
 The delegations of the United States and of Jordan jointly notified the U.S,-Jordan FTA under 
GATS V.7(a), as reflected in the document S/C/N/193 dated 18 October 2002. 
 
9. Why did the notification to the WTO take place one month after the date the agreement 
took effect?    
 The U.S. – Jordan FTA entered into force on 17 December 2001.  On 15 January 2002, the 
United States transmitted to the WTO the notificatio n of the U.S. – Jordan FTA under Article XXIV, 
as reflected in the document, WT/REG134/N/1 da ted 5 March 2002. As a general matter, we 
recognize the importance of early notification to our  trading partners, and the United States notified 
the two most recently-concluded agreements, the U. S. – Singapore FTA and the U.S. – Chile FTA, 
prior to entry-into-force.  3. Scope 
 
10. Is there any additional, preferential liberalisation of trade in services between the 
parties going beyond their respective commitments  under the GATS? If yes, please specify in 
which sectors and how?   
 Jordan’s services commitments go beyond what  it has committed to under the WTO General 
Agreement on Trade in Services (GATS). For exam ple, under the FTA, Jordan included commitments 
on the following services which were not included under the GATS: veterinary services; services 
incidental to fishing; services incidental to ener gy distribution; placement and supply services of 
personnel; radio and television servi ces; radio and television transmission services; refuse disposal 
services; internal waterways transport services; and rail transportation services. In other sectors, such 
as, for example, research and development ser vices and convention services, foreign equity 
limitations have been removed thus providing for gr eater liberalization of these services.  At the same 
time, sectors in which Jordan’s commitments unde r the FTA do not exceed its commitments under the 
GATS or are excluded altogether from both agreemen ts are: professional services, except veterinary 
services; computer and related services; real estate services; market research services; management 
consultancy services; services related to management consulting; packaging services; technical testing 
and analysis services; related scientific and technical  consulting services; maintenance and repair of 
equipment; photographic services; telecommunication services; construction and related engineering 
services; distribution services; recreational, cultural and sporting services; dental services; services incidental to mining; investigation and security services; postal services; sewage services; air passenger transportation services; air freight trans portation services; road transportation services; and 
pipeline transportation services.
2 
 
                                                      
2 It should be noted that the GATS employs a positive list approach in which commitments apply only 
to services that are listed explicitly in the schedules of specific commitments.  WT/REG134/5 
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  The United States’ commitments, which are e quivalent to those it has undertaken in the 
GATS, exclude the following sectors: medical and dental services; veterinary services; services provided by midwives, nurses, physiotherapists an d paramedical personnel; services incidental to 
manufacturing; printing services; postal services; primary education services; secondary education services; social services; sporting services; maritime transportation services; internal waterways 
transportation services; space transportation services; air passenger transportation services; air freight 
transportation services; and pipeline transportation services. As with Jordan, U.S. commitments on 
certain service sectors may be limited to specified activities.  
 
11. On the question of services trade:  
(a) On the basis of the sect oral classification list (MTN.GNS/W/120), how many 
sectors are committed for liberalization und er the agreement in addition to the 
sectors that are committed under the GATS?  Do the commitments of the United 
States for financial services also include the “Understanding”? 
Under the FTA, both Jordan and the United Stat es committed to liberalization in 11 broad 
service sectors as listed under the W/120. These sect ors are: (1) business services, including 
professional, computer-related, research and deve lopment, real estate, rental/leasing, and other 
business services; (2) communication services, including courier, telecommunication, and audiovisual services; (3) construction and related engineering services; (4) distribution services; (5) educational 
services; (6) environmental services; (7) financial services, including insurance, banking and other 
financial services; (8) health-related and social servi ces; (9) tourism and travel-related services; (10) 
recreational, cultural and sporting services; and ( 11) transportation services. Under its Schedule of 
Specific Commitments annexed to the FTA, Jordan has made commitments on additional sub-sectors 
not included in its GATS schedule, including veteri nary services, services incidental to fishing, 
services incidental to energy distribution, place ment and supply services of personnel, radio and 
television services, radio and television transmission services, refuse disposal services, internal 
waterways transport services, and rail transport services. 
  U.S. commitments under the GATS with respect to ‘banking and other financial services’ subscribe to the Understanding on Commitments in  Financial Services (“the Understanding”). The 
Understanding is not referenced in either Jordan ’s Schedule of Commitments under the  GATS or in 
its schedule under the FTA. 
 
(b) Do the commitments by the United States for telecommunication services 
include the content addressed in the GA TS Annex on Telecommunications and 
the “Reference Paper”?  
 Yes, the Telecommunications Reference Paper is included as part of the United States’ 
Schedule of Specific Commitments under the Jordan FTA. 
  
(c) Is it correct to understand that (i) the level of US commitments under this FTA is 
equal to (ii) the level of commitments under  NAFTA, and that any difference 
between (i) and (ii) is attributable to the differences in the modality of scheduling 
commitments?   
 We note Article V of the GATS does not require a comparison of the level of services 
commitments in FTAs with different trading partners. We also note that ‘modality’ refers simply to a 
way of listing commitments and has no bear ing on the scope of such commitments. 
 WT/REG134/5 
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(d) The scope of US commitments lists transport services.  Does this mean that 
maritime transport is also included in its commitments?    
 U.S. commitments on transportation services under its Schedule of Specific Commitments do 
not include maritime transport services.  U.S. commitments on transportation services include air 
transport services (aircraft maintenance and repair services only), rail transport services, road 
transport services, and other supporting and auxiliary  transport services (services provided by customs 
house brokers only).   
(e) On road passenger transport, the document WT/REG134/3 states that for Mode 
1, no limitations .  What specific routes are envisaged for this Mode 1 road 
transport?  Is it correct to assume th at this means a commitment for a multi-
modal transport, and includes transportation of buses on ferries?   
 U.S. commitments on road transport servi ces under the GATS include: interurban regular 
transport of passengers; freight transport of cargo that has either an origin or a destination outside of 
the United States; and maintenance and repair of ro ad transport equipment. The United States has not 
made commitments on multi-modal transport or transport by ferry under the GATS. 
  
(f) On road freight transport, commitments are undertaken only for those that use 
as ports of entry, California, Arizona, New Mexico and Texas.  Does this mean 
that the liberalization commitments are undertaken also for maritime freight 
transport between these ports and Jordan?   
 The U.S. maintained reservations on road tran sport with respect to Arizona, California, New 
Mexico and Texas, which were eliminated after Ja nuary 1, 2001 as indicated  in the United States’ 
initial offer under the GATS.  These reservations did not apply to maritime freight transport. 
  
II. PROVISIONS AFFECTING TRADE IN SERVICES 
1. Elimination Of Discriminatory Restrictions 12. The US and Jordan are communicating the elimination of a certain number of 
reservations in their respective schedules of co mmitments, to a certain date. However, these 
dates for the elimination of these restrictions a re also contained in the parties schedules of 
commitment under the GATS. In general, we co uld not detect any difference between the 
parties schedules of commitments under the no tified economic integration agreement and the 
GATS.   
 Reservations listed by the United States on road transport with respect to Arizona, California, 
New Mexico and Texas have been eliminated as indi cated in the United States’ initial offer under the 
GATS.  The elimination of such reservations also applies to U.S. commitments under the Jordan FTA. 
  The elimination of certain restrictions in Jo rdan’s schedules according to dates specified in 
both GATS and the FTA became effective for distribution services, courier services, education 
services, and health-related and social services. 
   WT/REG134/5 
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 13. Is Article 3.2 (c) (i) to be understood that the US and Jordan are granting each other’s 
services and service suppliers the exac t same treatment  as they gran t to all Members of WTO?   
 No. It means that any commitment reflected in  the Services Schedules to the FTA gives rise 
to the same rights and obligations as between the Parties as would the same commitment if it were listed in the corresponding GATS schedule.  These ri ghts and obligations are not the “exact same”.  
For example, the Parties have undertaken commitm ents in addition to those under the GATS.  In 
addition, GATS commitments give rise to right s under the WTO (such as consultations under the 
DSU and raising matters before the Council for Trade in  Services) that are not available with regard to 
commitments made exclusively in the FTA.  14. In article 8 of the notified agreement (Visa Commitments) the parties allow each other’s 
nationals to enter for the purpose of carrying on substantial trade, including trade in services. 
Are the US and Jordan, by application of this article, adding to their respective commitments 
under mode 4 (temporary movement of natural p ersons) of their schedules of commitments on 
services trade? If so, which categories of persons  are covered in addition? Are there numerical 
quotas for such persons?   
 Visa commitments specified under Article 8 of the FTA are pursuant to provisions under the 
United States’ Bilateral Investment Treaty (BIT) wi th Jordan and are not related to Mode 4 issues 
under the GATS.   
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