WORLD  TRADE  
ORGANIZATION  WT/TPR/S/171/Rev.1  
31 January 2007  
 
 (07-0426) 
Trade Policy Review Body  
   
 
  
 
TRADE POLICY REVIEW 
 
Report by the Secretariat 
 
EAST AFRICAN COMMUNITY 
 
Revision 
 
 
 
 
This report, prepared for the first joint Trade Policy Review of the East African 
Community (EAC), has been drawn up by the WTO Secretariat on its own 
responsibility.  The Secretariat has, as required by the Agreement establishing 
the Trade Policy Review Mechanism (A nnex 3 of the Marrakesh Agreement 
Establishing the World Trade Organization), sought clarification from the EAC 
members on their trade policies and practices. 
 
Any technical questions arising from this report may be addressed to 
Mr. Ricardo Barba (tel: 022/739 50 88), Mr. Arne Klau (tel: 022/739 57 06), or 
Mr. Jacques Degbelo (tel: 022/739 55 83).  
 
Document WT/TPR/G/171 contains the policy statements submitted by Kenya, 
Tanzania, and Uganda. 
 
 
Note: This report is subject to restricted circ ulation and press embargo until the end of the first 
session of the meeting of the Trade Policy Revi ew Body on the East African Community.  
 EAC WT/TPR/S/171/Rev.1 
 Page iii 
 
 
 CONTENTS 
Page 
SUMMARY OBSERVATIONS v 
 (1) T HE ECONOMIC ENVIRONMENT  v 
 (2) L EGAL AND  INSTITUTIONAL FRAMEWORK  v 
 (3) T RADE POLICY INSTRUMENTS  vi 
 (4) S ECTORAL POLICIES  viii 
 (5) T RADE POLICY AND TRADING PARTNERS  viii 
I. THE EAST AFRICA N COMMUNITY (EAC) 1 
(1) O VERVIEW  1 
(2) L EGAL FRAMEWORK  1 
(3) I NSTITUTIONAL STRUCTURE  3 
II. TRADE ARRANGEMENTS INVOLVING EAC MEMBERS 6 
(1) P ARTICIPATION IN THE WTO 6 
(2) C OMMON MARKET FOR EASTERN AND SOUTHERN AFRICA (COMESA) 7 
 (3) S OUTHERN AFRICAN DEVELOPMENT COMMUNITY (SADC) 9 
(4) O THER TRADE ARRANGEMENTS  10 
(i) Cotonou Agreement, and the Everything-but-Arms (EBA) Initiative of the 
EC 11 
(ii) African Growth and Opportunity Act (AGOA) 12 
(iii) African Economic Community (AEC) and the African Union (AU) 13 
 (iv) Regional Integration Facilitation Forum (RIFF) 13 
(v) Intergovernmental Authority on Development (IGAD) 14 
 (vi) Indian Ocean Rim-Association for Regional Cooperation (IOR-ARC) 14 
(vii) Generalized System of Preferences (GSP) 15 
III. COMMON TRADE POLICY MEASURES 16 
(1) I NTRODUCTION  16 
(2) C USTOMS PROCEDURES  16 
(i) Customs clearance and valuation 16 
(ii) Rules of origin 16 
(3) T ARIFFS , AND OTHER DUTIES AND CHARGES  17 
(i) MFN applied tariff structure 17 
(ii) Tariff preferences 23 (iii) Duty and tax exemptions and concessions 23 
(iv) Other duties and charges 23 
(4) C
ONTINGENCY MEASURES  23 
(5) I MPORT PROHIBITIONS , RESTRICTIONS , AND LICENSING  24 
(6) S TANDARDS AND OTHER TECHNICAL REQUIREMENTS  24 
(7) E XPORT PROHIBITIONS , RESTRICTIONS , AND LICENSING  25 WT/TPR/S/171/Rev.1 Trade Policy Review 
Page iv 
 
 
 Page 
(8) E XPORT ASSISTANCE  25 
 (9) C OMPETITION POLICY AND REGULATORY ISSUES  25 
REFERENCES   27 
ANNEX 1:  KENYA  29 
ANNEX 2:  TANZANIA  127 
ANNEX 3:  UGANDA  209 
CHARTS 
III. COMMON TRADE POLICY MEASURES 
III.1 Breakdown of applied MFN tariffs, 2006 18 
III.2 EAC's tariff by ISIC classification, 2006  21 
III.3 Tariff escalation by ISIC 2-digit industry, 2006 22 
TABLES 
III. COMMON TRADE POLICY MEASURES 
III.1 Structure of MFN tariffs in the EAC, 2006 17 
III.2 "Sensitive" products subject to high tariffs, 2006 18 III.3 Summary analysis of the East African Customs Union MFN tariff, 2006 20 
III.4 Products for which applied MFN rates may be higher than the final bound rate, 2006 22 
 
 
 
  EAC WT/TPR/S/171/Rev.1 
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 SUMMARY OBSERVATIONS 
(1) T HE ECONOMIC ENVIRONMENT  
1. Since their previous TPRs, held 
separately during 2000-01, the three East African Community (EAC) members (Kenya, Tanzania and Uganda) have continued their economic reform programmes aimed at addressing their common challenges, 
including poverty reduction; sustainable 
economic growth and development;  more equitable income distribution; unemployment reduction; and full integration into the world economy.  The reforms have resulted in real 
GDP growth rates of over 4% per year in 
2004 and 2005, despite the negative impact of external shocks, notably droughts and low levels of investment.  
2. Over the last few years, high oil prices 
have resulted in an increa se in inflation rates 
for the three EAC members, and their fiscal deficits (including grants) have also risen.  With the exception of Kenya in 2003, the EAC countries have registered external current account deficits since 2000.  They continued to 
attract foreign direct investment throughout 
the 2000-05 period, though small by international standards, but significant to their economies. 
3. Each EAC member currently has its 
own monetary and exchange rate policies:  
Kenya maintains a managed floating exchange rate regime to smooth out fluctuations of the Kenyan Shilling (K Sh);  the official exchange rate of the Tanzanian Shilling (T Sh) is determined by the national interbank market; 
and Uganda has an independently floating 
exchange rate regime for the Ugandan Shilling (U Sh).  The three exchange rate systems are free of restrictions on payments and transfers for current international 
transactions, the countries having accepted 
the obligations of Article VIII of the IMF agreement. 
4. The full integration of EAC members 
will bring together two least developed 
countries (Tanzania with per capita GDP of US$303, and Uganda with per capita GDP of 
US$220 in 2004) and a low-income developing country (Kenya with per capita GDP of US$416 in 2004), for a combined 
population of about 90 million people and 
GDP of around US$30 billion.  This is expected to provide a strong foundation for their participation in the world economy.  The re-establishment of a monetary union, which 
was in place during the first few years after 
independence, is also expected to introduce more discipline into their monetary policy formulation and implementation.  
(2) L
EGAL AND INSTITUTIONAL 
 F RAMEWORK  
5. Kenya, Tanzania, and Uganda have a 
long history of regional integration that dates back to the creation  of the original EAC (in 
1917), which collapsed for a variety of 
political and economic re asons in 1977.  The 
current EAC, which entered into force on 7 July 2000, is to be an economic area (including customs and monetary unions, with harmonized macroeconomic policies, and 
ultimately a political federation), although no 
overall timetable has been established. 
6. The EAC's legal framework consists 
mainly of:  the Treaty for its establishment; its Protocol; and its Customs Management Act.  
The framework provides for, inter alia, a 
common external tariff (CET);  asymmetry in the liberalization of intra-EAC trade;  rules of origin; contingency trade remedies;  restrictions to trade for security and other reasons;  competition;  duty drawback, refund 
and remission of duties and taxes;  exemption 
regimes;  customs cooperation;  re-exportation of goods; simplification and harmonization of trade documentation and procedures;  use of the harmonized commodity 
description and coding system; and freeports.  
However, EAC members are yet to fully implement some of those provisions, such as harmonization of customs procedures, other duties and charges on imports, internal 
indirect taxes, and of fees on production. WT/TPR/S/171/Rev.1 Trade Policy Review 
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 7. The EAC's main institutions are:  the 
Summit of Heads of State and/or Government; Council of Ministers; Coordination Committee;  sectoral committees;  East 
African Court of Justice;  East African 
Legislative Assembly; and the Secretariat (based in Arusha, Tanzania).  In addition, the EAC Protocol established the Committee on Trade Remedies to handle: rules of origin; 
contingency trade remedies;  dispute 
settlement mechanism; and any other matter referred to it by the Council.  The EAC currently has the following autonomous institutions: Lake Victoria Development Programme;  the East African Development 
Bank (EADB);  Lake Victoria Fisheries 
Organization (LVFO);  and the Inter-University Council for East Africa (IUCEA). 
8. EAC countries are all original WTO 
Members.  They are neither signatories nor 
observers to any of the WTO plurilateral 
agreements.  All EAC countries accord at least MFN treatment to all their trading partners. They have not been directly  involved, either as 
complainant or as defendant, in any WTO dispute settlement proceedings.  However, 
both Kenya and Tanzania have participated as 
third parties in the "European Communities-export subsidies on sugar" disputes brought separately by Australia, Brazil, and Thailand. 
9. In addition to the EAC, Kenya, 
Tanzania, and Uganda are also members of 
the African Economic Community (AEC) and the African Union (AU), the Regional Integration Facilitation Forum (RIFF), and participate in different regional trade 
agreements.  Kenya and Uganda are members 
of the Intergovernmental Authority on Development (IGAD), and the Common Market for Eastern and Southern Africa (COMESA);  Tanzania is considering re-entering COMESA after its withdrawal in 
2000. Kenya and Tanzania participate in the 
Indian Ocean Rim-Association for Regional Cooperation (IOR-ARC).  Unlike Kenya and Uganda, Tanzania is member of the Southern African Development Community (SADC), and 
a signatory to the Agreement on the Global System of Trade Preferences among 
Developing Countries (GSTP). 
10. Under the EAC, each country is free 
to negotiate new bilateral trade agreements, 
subject to notification to the other two 
members.  In practice, this overlapping membership poses certain difficulties to the EAC countries, mainly because of differences in, inter alia, origin criteria, and intra-
regional trade liberalization scenarios under 
the agreements.  Furthermore, EAC members are also eligible for non-reciprocal preferential treatment under the Generalized System of Preferences;  the Cotonou Agreement with the EC; and the U.S. African 
Growth and Opportunity  Act.  As LDCs, 
Tanzania and Uganda are eligible for the Everything-but-Arms initiative of the EC. 
(3) T
RADE POLICY INSTRUMENTS  
11. During the Uruguay Round, the EAC 
members bound their tariffs individually.  Bindings cover 13.5% of all Tanzania's tariff lines, 14.9% of Kenya's, and 15.9% of Uganda's:  these cover all tariffs on 
agricultural products, and 0.1% of Tanzania's 
non-agricultural tariff lines, 1.6% of Kenya's and 2.9% of Uganda's.  These tariff binding commitments leave ample margins for discretionary increases in applied rates. 
12. In January 2005, the EAC CET 
entered into force, with a few provisional exemptions (for Kenya, on its rice imports from Pakistan;  and for Tanzania, on its wheat and barley imports).  The move from national tariffs to the CET has reduced average tariff 
protection in Kenya and Tanzania, and has 
increased it in Uganda.  The overall average applied rate of the CET is 12.9%.  The average tariff on agric ultural goods (WTO 
definition) remains relatively high (19.7%), 
against 11.9% on non-agricultural products.  
Using the ISIC (Revision 2) definition of sectors, agriculture, hunting, forestry, and fishing is the sector with the highest tariffs (17.3% on average), followed by 
manufacturing (12.8%), and mining and EAC WT/TPR/S/171/Rev.1 
 Page vii 
 
 
 quarrying (5.8%).  About 99% of all tariff 
lines carry rates of 0%, 10%, or 25%.  Some 58 tariff lines carry higher rates, mainly on dairy goods, wheat, and sugar.  For eleven 
lines, applied tariffs are compound and could 
exceed bound ad valorem rates, depending on the unit import price of the product.  
13. In aggregate, the EAC's tariff shows a 
pattern of mixed escalation, negative from the 
first stage of processing (with an average tariff 
of 13.5%), to semi-finished products (with an average of 10.1%), and then positive to fully processed goods, on which tariffs average 14.4%. This structure reflects the relatively high tariff protection for agricultural 
commodities in particular.  Further 
simplification of the tariff structure through, inter alia, reduction of rates on agricultural commodities, should reduce the need for concessions, introduce more transparency in 
the tariff regime, and make it more neutral, 
and hence less distorting.  
14. Kenya and Tanzania bound other 
duties and charges at zero.  However, Kenya applies an import processing fee of 2.75%, and Tanzania a destination inspection fee of 
1.2% and a customs processing fee of US$10.  
Uganda bound other duties and charges at between 10% and 30%;  it has abolished its 2% import commission, and transportation and insurance from entry points in Kenya and 
Tanzania to its border are no longer dutiable.  
Imports and locally produced goods are also subject to VAT at different rates in the three EAC countries (standard rates of 16% in Kenya, 20% in Tanzania, and 18% in 
Uganda), and to excise duties at different 
rates. 
15. The free-trade area component of the 
EAC customs union is being established through asymmetrical liberalization.  While imports from Tanzania or Uganda are duty-
free, tariffs on some selected items from Kenya 
to the other EAC countries remain in place and will be phased out by 2010.  Members are also committed to removing non-tariff barriers on intra-EAC trade.  Under SADC, Tanzania grants duty-free access (on a reciprocal basis) 
on mostly capital goods and equipment from other members.  Under COMESA, Kenya and Uganda apply preferences of 0%, 4%, and 6% 
on inputs, intermediate goods, and final goods, 
respectively.  Kenya applies a preferential tariff quota to sugar imports from other COMESA members. 
16. While the EAC has adopted 
regulations on contingency measures, no anti-
dumping, countervailing or safeguard actions have yet been taken.  The EAC members increasingly adopt joint voluntary standards (close to 600 as at July 2006).  In addition, they individually have technical regulations; 
Kenya is the only EAC member with a certain 
capacity to enforce its technical regulations.  The members also maintain common prohibitions and restrictions on imports for security, health, sanitary, environmental, and 
moral reasons;  they are allowed under the 
EAC rules to apply such measures individually for a transitional period.  
17. The EAC has adopted provisions that 
allow  member states to establish 
manufacturing under bond, export processing 
zones, and duty drawback schemes; the sale of 
goods (produced under any such scheme) in the customs territory is limited to 20% of production.  The EAC members apply an export tax of 20% on raw hides and skins to 
encourage local processing of these goods.  
An EAC Competition Bill is under consideration. For the time being, Kenya and Tanzania each has its own competition policy, and Uganda is preparing its legislation. 
18. EAC members have implemented their 
individual privatization programmes, with divestiture of some 108 enterprises in Kenya, 380 in Tanzania, and 224 in Uganda.  New public procurement regimes were adopted in 2003 by Uganda, and in 2005 by Kenya and 
Tanzania.  Kenya has adopted new legislation 
on intellectual property rights;  it is also negotiating to achieve an extension of the TRIPS Agreement to protect genetic resources and traditional knowledge.  Tanzania is WT/TPR/S/171/Rev.1 Trade Policy Review 
Page viii 
 
 
 revising its legal provisions on patents and 
trade marks to align them on the WTO TRIPS Agreement by 2006.  Uganda has adopted a new Copyright Act.  
19. Overall, with the exception of customs 
issues (which are being harmonized), including the CET and customs procedures, non-tariff measures are yet to be fully harmonized within the EAC.  Moreover, 
differences remain between mainland 
Tanzania and Zanzibar in certain trade policy instruments (e.g. on dom estic trade and export 
promotion). 
(4) S
ECTORAL POLICIES  
20. Sectoral policies are not yet 
harmonized throughout the EAC area, and there are differences between mainland Tanzania and Zanzibar regarding some 
sectoral strategies, such as on agriculture, 
energy, telecommunications, and tourism.  Full establishment of the EAC customs union is expected to further harmonize sectoral policies, both among EAC countries, and between mainland Tanzania and Zanzibar. 
21. Agriculture provides livelihood and 
employment to the majority of the EAC population; nonetheless, its contribution to GDP has decreased over the last few years.  Food insecurity in the EAC has increased 
recently due to several factors, including 
unfavourable weather conditions (drought or floods), making emergency food aid necessary.  Tariffs are the main trade policy instrument in the sector, although some non-tariff measures are still in force.  Applied MFN tariffs on 
agricultural products average 17.3%;  and 
non-tariff barriers include SPS measures, although Kenya is the only EAC country with capacity to enforce them. 
22. Mining and quarrying is the fastest 
growing sector in Tanzan ia and an important 
foreign exchange source and a magnet for foreign investment; while in Kenya and Uganda, the sector remains of minor importance.  Private investment is being 
encouraged in the sector, but some mining activities, notably exploitation, are still 
dominated by state-owned companies.  Tariff protection for the sector is relatively low at 5.8% on average. 
23. The manufacturing sector in the EAC 
produces largely for the do mestic market, with 
part of the production exported to regional markets.  It continues to be relatively small and based mainly on the processing of 
agricultural goods in Tanzania and Uganda, 
and decreasing in Kenya, the most industrialized EAC country.  EAC members have various programmes to promote industrial development and exports.  The general development of the sector, however, 
has largely been hampered by supply-side 
constraints (e.g. high production costs, limited access to financing, and low quality of products). Furthermore, subject to concessions, the negative escalation of the 
EAC CET (with an average rate of 12.8% on 
manufactured products and relatively high rates on agricultural commodities, including those used as inputs) is not conducive to investment in certain manufacturing activities. 
24. The potential of the services sector 
remains largely unexploited in the EAC. In 
tourism, for example, where the EAC's attractions are among the best in Africa, inadequacies in infrastructure and marketing/promotion, financial constraints, 
security issues, and lack of skilled labour have 
limited its development. Further liberalization and commitments under the GATS should contribute to attracting investment in services, in general, and should improve the efficiency 
of other economic activities and the 
competitiveness of EAC's exports, especially by reducing costs related to, inter alia, telecommunications, transport, and energy. 
(5) T
RADE POLICY AND TRADING 
 P ARTNERS  
25. The three EAC members have resident 
delegations in Geneva and participate actively in the WTO.  They support the Doha 
Development Agenda, which provides an EAC WT/TPR/S/171/Rev.1 
 Page ix 
 
 
 opportunity to address some of what they 
consider as imbalances in the WTO Agreements, and to improve access conditions for their exports into other markets.  The EAC 
members have introduced or are in the process 
of formulating legislation that will bring their trade regimes more up to date and into greater conformity with WTO provisions.  Improvement of their multilateral 
commitments, through reduction of bound 
rates, enlargement of the scope of bindings on goods and services, elimination of applied compound tariffs (all bound duties are ad valorem), and removal of other duties and charges by Kenya and Tanzania would 
increase the predictability and credibility of 
the EAC trade regime. 
26. Membership in overlapping 
preferential arrangements, notably the combination of free-trade areas (e.g. SADC) and customs unions (e.g. EAC, COMESA), 
makes their trade regimes complex, and difficult to manage.  Moreover, EAC rules allow each member to sign bilateral 
agreements, subject to notification to the other 
members.  This, together with the overlapping membership, may limit the proper functioning of the EAC as a customs union. In addition, more attention needs to be paid to non-tariff 
measures in the full establishment of the EAC 
customs union (its free-trade-area and common trade-measure components).   
27. Continued structural reforms and 
further trade liberalization by EAC members would contribute to better resource allocation.  
Such efforts will improve their ability to 
attract investment. Trading partners could help by ensuring that their markets are fully open to goods produced in EAC and by providing more technical assistance. 
   
  
  
 EAC WT/TPR/S/171/Rev.1 
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 I. THE EAST AFRICAN COMMUNITY (EAC) 
(1) OVERVIEW  
1. East Africa has a long history of regional integration.  Kenya and Uganda first formed a 
customs union in 1917, which the then Tanganyika (Tanzania without Zanzibar) joined in 1927.  
Subsequently, the three countries had close econom ic relationships in the East African High 
Commission (1948-61);  the East African Common Services Organization (1961-67);  the East 
African Community (1967-77);  and the East African Cooperation (1993-99).1 
2. The (current) Treaty for the Establishment of the East African Community (EAC) was signed 
on 30 November 1999, and entered into force on 7 Ju ly 2000.  The present EAC has its origins in the 
Mediation Agreement for Division of Assets and Liab ilities of the original EAC, which collapsed for 
a variety of political and economic reasons in 19 77.  In that Mediation Agreement, signed on 
14 May 1984, Kenya, Tanzania, and Uganda agreed to explore areas of future cooperation, and to 
make concrete arrangements for such cooperation.  Subsequent meetings of the three Heads of State 
led to the signing of the Agreement for the Esta blishment of the Permanent Tripartite Commission 
(PTC) for East African Cooperation on 30 Novemb er 1993.  Full fledged cooperation started on 
14 March 1996 when the Secretariat of the PTC w as launched at the headquarters of the EAC in 
Arusha, Tanzania.2 
3. In addition to the EAC, Kenya, Tanzania, a nd Uganda are also members of the African 
Economic Community (AEC), the African Union (AU), and the Regional Integration Facilitation 
Forum (RIFF), and participate in different regi onal trade agreements.  Kenya and Uganda are 
members of the Inter Governmental Authority on Development (IGAD), and the Common Market for 
Eastern and Southern Africa (COMESA);  Tanzania  is considering re-entering COMESA after its 
withdrawal in 2000. Kenya and Tanzania participate in the Indian Ocean Rim-Association for 
Regional Cooperation (IOR-ARC).  Unlike Kenya and Ug anda, Tanzania is member of the Southern 
African Development Community (SADC).  This overlapping membership poses certain difficulties 
for the EAC members, mainly because of differences in, inter alia , origin criteria, and intra-regional 
trade liberalization scenarios under the various agreements.  
4. Under the EAC, each member is free to negotiate new bilateral trade agreements, subject to 
notification to the other two members.  Only Kenya has signed bilateral trade agreements. 
5. EAC members are also eligible for non-r eciprocal preferential treatment under the 
Generalized System of Preferences (GSP);  the Cotonou Agreement with the EC;  and the U.S. 
African Growth and Opportunity Act (AGOA).  As  least developed countries (LDCs), Tanzania and 
Uganda are eligible for the Everything-but-Arms  (EBA) initiative of the EC;  Kenya is not. 
6. Tanzania is a signatory to the Agreement on the Global System of Trade Preferences among 
Developing Countries (GSTP);  Kenya and Uganda are not. 
(2) LEGAL FRAMEWORK  
7. The EAC's legal framework consists mainly of:  the Treaty for the Establishment of the EAC; 
the 2001-05 EAC Development Strategy; the EAC Pr otocol; and the EAC Customs Management Act.  
The key objective of the EAC is to develop polici es aimed at widening and deepening cooperation in 
all fields for the mutual benefit of its members (Ar ticle 5 of the EAC Treaty).  The EAC is thus to be 
                                                           
1 IMF (2005). 
2 East African Community Secret ariat online informati on.  Available at: ww w.eac.int/history.htm. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 2 
 
 
 an economic area (including customs and monetary unions, with harmonized macroeconomic policies, 
and ultimately a political federation), alt hough no timetable has been established.3  
8. The EAC's specific objectives include:  (a) promoting sustainable growth and equitable 
development for its members, including rational use of the region's natural resources and protection of 
the environment;  (b) strengthening and consolid ating the long-standing political, economic, social, 
cultural, and traditional ties of its members;  (c) e nhancing the participation of the private sector and 
civil society;  (d) mainstreaming gender in all its  programmes and enhancing the role of women in 
development;  (e) promoting good governance, incl uding adherence to the principles of democratic 
rules of law, accountability, transparency, social jus tice, equal opportunities, and gender equality;  and 
(f) facilitating peace and stability within the region. 
9. The 2001-05 EAC Development Strategy id entifies twelve areas of cooperation: 
macroeconomic policies, including monetary an d fiscal; trade liberalization and development; 
promotion of key economic sectors (i.e. agriculture  and food security, investment and industrial 
development, tourism and wildlife, and environm ent and natural resources); infrastructure and 
supportive services; human resource developmen t, science, and technology; social sectors, 
immigration, and labour policies; legal and judicial affairs; political matters, including peace, security. 
and defence; broad participation of women, privat e sector and civil society; relations with other 
regional and international organi zations (e.g. COMESA, SADC); in stitutional arrangements at the 
level of member states and the EAC Secretariat; a nd managing distribution of benefits and costs as a 
cross-cutting issue.4  The 2006-10 EAC Development Strategy is  currently in draft format and is 
expected to be adopted at the end of 2006. 
10. Under the Protocol on the Establishment of  the EAC Customs Union (Article 3), the 
objectives of the customs union are: further liberali zation of intra-regional trade in goods on the basis 
of mutually beneficial trade arrangements among member states; promotion of efficiency in production within the EAC; enhancement of domestic , cross-border and foreign investment in the 
EAC; and promotion of economic de velopment and diversification in  industrialization in the EAC. 
The Protocol's Annexes I to IX are on:  common exte rnal tariff (CET);  internal tariffs;  rules of 
origin;  anti-dumping measures;  subsidies a nd countervailing measures;  safeguards;  export 
processing zones; free port operations; and dispute settlement mechanism. 
11. In accordance with provisions of Article 75 of  the EAC Treaty, the Protocol provides for: 
asymmetry in the liberalization of intra-EAC trade;  e limination of internal tariffs and other charges of 
equivalent effect;  elimination of non-tariff barriers;   establishment of a CET;  rules of origin;  anti-
dumping measures;  subsidies and countervailing duties;  security and other restrictions to trade;  competition;  drawback, refund, and remission of du ties and taxes;  customs cooperation; re-export of 
goods;  simplification and harmonization of trade docum entation and procedures;  exemption regimes;  
harmonized commodity description and coding system;  and freeports.
5  However, EAC members 
have not yet fully implemented some of these provi sions.  Areas still to be harmonized are internal 
taxes, customs procedures, other duties and charges on imports, and fees on production.  The EAC certificate of origin is not yet operational; the COMESA certificate is currently used. 
12. Under the Protocol, the customs union is to be established progressively over five years from 
the entry into force of the Protocol, which was signed on 2 March 2004, and entered into force on 
                                                           
3 The Committee on Fast Tracking East African Federation, established on 26 November 2004, is 
examining ways and means to expedite the process of EAC integration so that a political federation is achieved as quickly as possible ( The Community , Issue 3, June 2005). 
4 East African Community Secretar iat online information.  Availa ble at: www.eac.int/strategy.htm. 
5 Article 2 of the Protocol. EAC WT/TPR/S/171/Rev.1 
 Page 3 
 
 
 1 January 2005.  The EAC CET, adopted as from 2005, has three bands (0, 10%, and 25%), although 
rates above 25% apply to a number of "sensitive" products (Chapter III(3)(i)).  EAC members are to 
review the maximum rate of the CET after 1 January 2010.6 
13. The free-trade area component of the EAC custom s union is yet to be established. Trade in 
goods between Tanzania and Uganda, as well as im ports from Tanzania and Uganda to Kenya, has 
been duty free since 1 January 2005, while goods from Kenya to Tanzania and Uganda are under 
either Category A (for immediate duty-free treat ment) or Category B (gradual tariff reduction). 
Internal tariffs on Category B g oods (some 880 tariff lines at the HS six-digit level in the case of 
Tanzania, and some 443 lines in the case of Uganda), sp ecified in Annex II of the Protocol, are to be 
phased out as follows: a 10% tariff rate in 2005; 8% in 2006; 6% in 2007; 4% in 2008; 2% in 2009; 
and zero thereafter.7 
14. The EAC Customs Management Act was enact ed on 16 December 2004.  It governs the 
administration of customs, including administrative and operational matters. According to the Act, the 
day-to-day operations of customs, including collec tion of revenue, will con tinue to be managed and 
administered by the respective national revenue aut horities.  The revenue authorities in each member 
state, in conjunction with the ministries responsible  for EAC affairs, Finance, Trade and Industry, are 
responsible for the gradual establishment of the EAC customs union 
15. EAC negotiations on trade in services are to commence in 2006 as part of the EAC common 
market. Burundi and Rwanda have applied to join  the EAC, and high-level negotiations on their 
accession are advanced. They are expected to b ecome EAC members before the end of 2006. 
(3) I NSTITUTIONAL STRUCTURE  
16. The main institutions of the EAC are:  the Su mmit of Heads of State and/or Government;  
Council of Ministers;  Coordination Committee;  secto ral committees;  East African Court of Justice; 
East African Legislative Assembly;  and the Secret ariat.  In addition, Article 24 of the Protocol 
established the EAC Committee on Trade Remedies to ha ndle:  rules of origin;  contingency trade 
remedies;  dispute settlement mechanism;  and any other matter referred to the Committee by the 
Council.  The EAC has the following autonomous  institutions:  Lake Victoria Development 
Programme8;  the East African Development Bank (EADB)9;  Lake Victoria Fisheries Organization 
(LVFO)10;  and the Inter-University Council for East Africa (IUCEA).11 
                                                           
6 Article 12 of the Protocol. However, the Council of Ministers of the EAC is mandated to review the 
CET structure, and approve measures to remedy any adverse effects, on any member state, induced by the 
implementation of the CET or, by exceptional circumstances. 
7 Internal tariffs must not exceed the CET on any of th e specified products (Artic le 11 of the Protocol).  
The EAC Council may decide, at any time, that tariff ra tes may be reduced more rapidly or abolished earlier 
than provided for by the schedule. 
8 The Lake Victoria Development Programme, established in 2001, provides a mechanism for 
coordinating the various interventions on the lake and its basin, and serves as a centre for promotion of 
investments and information sharing. It is focusing on, inter alia , harmonizing policies and laws on the 
environmental management of the lake and its cat ch area (East African Community Secretariat online 
information.  Available at: www.eac.int/programme.htm).  
9 The EADB was first established in 1967 under the former East African Community. Following the 
break up of the EAC in 1977, the Bank was re-established under its own Charter in 1980. It offers a broad range of financial services to EAC members (EADB online in formation.  Available at: www.eadb.org/background). 
10 The LVFO, established in 1994, aims to fost er cooperation amongst EAC members in matters 
regarding Lake Victoria;  harmonize national measures for the sustainable use of fisheries and other resources;  WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 4 
 
 
 17. The Summit is responsible for,  inter alia : the overall policy direction and functioning of the 
EAC; considering the annual progress reports and other reports submitted to it by the Council; and 
reviewing the state of peace, security, and g ood governance within the EAC, and the progress 
achieved towards the establishment of a political fe deration. Subject to the Treaty, the Summit may 
delegate the exercise of any of its functions to one  of its members, to the Council or to the Secretary 
General. The Summit meets at least once a year, an d may hold extraordinary meetings at the request 
of any member. It is chaired in turn by each memb er state for one year. The decisions of the Summit 
are taken by consensus. 
18. The Council of Ministers is the main policy decision-making institution. It initiates and 
submits bills to the Assembly; gives directions to the member States and to all other organs of the 
EAC other than the Summit, Court, and the Assembly; makes regulations, issues directives, takes decisions, and gives opinions in accordance with th e provisions of the Treaty; considers the budget; 
submits annual progress reports to the Summit, for which it prepares the meetings agendas; 
establishes sectoral committees provided for by the Treaty; and implements the decisions and directives of the Summit.  The Council consists of  ministers responsible for regional cooperation and 
any other ministers members may designate.  It me ets twice a year, immediately after the Summit, or 
at the request of a member state or the chairperson of the Council.  It is chaired in turn by a minister 
of each member state.  The decisions of the Council are taken by consensus. 
19. The Coordination Committee (CC) is responsible for regional cooperation and coordinates the 
activities of the sectoral committees.  It also, inter alia , submits reports and recommendations to the 
Council either on its own initiative or upon the Counc il's request; implements the decisions of the 
Council; receives and considers reports by the sect oral committees;  and may request a sectoral 
committee to investigate any particular matter.  The CC consists of the permanent secretaries 
responsible for regional cooperation and any other permanent secretaries members may designate. It 
meets at least twice a year (before the meetings of the Council), and may hold extraordinary meetings 
at the request of the chairperson of the Committee.  It  is chaired in turn by a permanent secretary from 
each member State. 
20. The sectoral committees formulate programmes and monitor their implementation. They meet 
as often as necessary and are responsible for setting out sectoral priorities; and submit, from time to time, sectoral reports and recommendations to the CC.  The CC recommends to the Council the composition of the sectoral committees. 
21. The East African Court of Justice, established under Article 9 of the Treaty, ensures that EAC 
law is interpreted and implemented in line with the Treaty. The Court has jurisdiction to hear and 
determine disputes between member states on the inte rpretation and application of the Treaty (if the 
dispute is submitted to it under a special agreement) , and between the Community and its employees.  
The Court became operational on 30 November 2001, and is temporarily located in Arusha, until the 
Summit determines its permanent seat. The six judge s, two from each member, are appointed by the 
Summit from among sitting judges of any national court of judicature or from recognized jurists, 
while the Registrar is appointed by the Council. 
                                                                                                                                                                    
 
and develop and adopt conservation and management measures to assure the lake's ecosystem health and 
sustainability (LVFO online information.  Ava ilable at: www.inweh.unu.e du/lvfo/Default.htm). 
11 The IUCEA, established in 1980, aims to facilita te contact between the universities of East Africa, 
provide a forum for discussion on academic and other matters relating to higher education, and help maintain 
high and comparable academic standards (IUCEA on line information.  Ava ilable at. www.iucea.org). EAC WT/TPR/S/171/Rev.1 
 Page 5 
 
 
 22. The East African Legislative Assembly provid es a democratic forum for debate. It has a 
watchdog function, and ultimately is  responsible for the legislative process. The Assembly interacts 
with the national assemblies of member states on EAC matters;  debates and approves the EAC budget; considers annual reports, annual audit reports,  and any other reports referred to it by the 
Council; makes recommendations to the Council on the implementation of the Treaty; and 
recommends to the Council the appointment of th e Clerk and other officers. The Assembly has 
27 elected members, and five ex-officio members consisting of the three ministers for regional 
cooperation, the Secretary General and the Counsel to the Community.  A Speaker presides over the Assembly. 
23. The Secretariat, based in Arusha, is the executiv e organ of the EAC.  As the guardian of the 
Treaty, it ensures that regulations and directives a dopted by the Council are properly implemented.  It 
is responsible for: the day-to-day administrati on of the Treaty;  coordinating and monitoring the 
implementation of Council and Community d ecisions;  arranging meetings, disseminating 
information, and keeping minutes of meetings of the EAC institutions (it is the depositary of all 
records of EAC); assisting in the harmonization of national policies and strategies of member states in 
so far as they relate to EAC;  and assisting in the negotiation of trade agreements with third parties.  
The Secretariat is headed by a S ecretary General, who is a citizen of a member State, and serves a 
fixed five-year term.  The core budget of the Secr etariat is funded by equa l contributions from the 
member states. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 6 
 
 
 II. TRADE ARRANGEMENTS INVOLVING EAC MEMBERS 
(1) PARTICIPATION IN THE WTO 
1. The EAC members became, individually, original WTO Members on 1 January 1995.12  They 
are neither signatories nor observers to any of th e WTO plurilateral agreements. EAC members have 
not been involved directly, either as complain ant or defendant, in any WTO dispute settlement 
proceedings. However, both Kenya and Tanzania have  participated as third parties in the disputes  
brought separately by Australia, Brazil, and Tha iland, on "European Communities-export subsidies on 
sugar".13  The three EAC countries accord at least MFN treatment to all their trading partners. 
2. The EAC members attach great importance to the Doha Development Agenda (DDA). Their 
priorities in the DDA include: improved market access for their agricultural products through bound 
duty-free and quota-free access for all their products , and the removal of other non-tariff barriers, 
export subsidies and domestic s upport; the reduction of high tari ffs and tariff escalation on non-
agricultural products of interest to developi ng and LDCs; greater opportunities in services, 
particularly through the movement of natural persons, including less skilled labour; extension of 
geographical indications coverage  beyond wines and spirits, in order to maintain the identity of 
indigenous export products; stre ngthening of S&D provisions; and the provision of meaningful 
technical assistance, including in capacity building,  which will allow DCs and LDCs to participate 
fully and effectively in all negotiations, and ultimat ely to take advantage of the opportunities offered 
by the multilateral trading system.   
3. According to the EAC members, to achieve a truly developmental outcome, the DDA must 
ensure that the outcome of the Doha negotiati ons supports poverty-reduc ing economic growth, and 
provide space for DCs and LDCs to pursue appropriate national policies that enhance welfare and foster economic development. The outcome of thes e negotiations must also strengthen and support the 
regional integration initiatives in the EAC countri es and other regional trading arrangements on the 
African continent.  To determine how to particip ate fully in the Doha development process, the EAC 
countries have indicated that technical assistance and capacity building must support analytical and 
operational research at the country and regional le vels, be aimed at mobilizing constituencies that 
have an interest in domestic policy reform, and be provided through multilateral initiatives. 
4. The EAC member states' technical assistance requirements relate to:  the harmonization of 
laws and regulations with WTO requirements;  not ifications;  staff training, and establishment of 
institutional structures to facilitate the implemen tation and observance of Agreements;  and the 
formulation of policies that allow maximum benefi t from trade reforms and the application of the 
WTO Agreements, and minimize costs.
14 A trade reference centre has been established by the WTO 
in the EAC Secretariat. 
5. Customs reform and capacity-building have been long-standing items on EAC countries' 
policy agenda.  The implementation of modern, WTO- consistent customs procedures is a priority.  
                                                           
12 Kenya joined the GATT on 5 February 1964, Tanzania on 9 December 1961 (formerly Tanganyika), 
and Uganda on 23 October 1962. 
13 WTO documents WT/DS265/R, WT/DS266/R, and WT/DS283/R, 15 October 2004. 
14 Tanzania and Uganda were two of five countrie s (with Bangladesh, Haiti, and the Gambia) to have 
held trade-related roundtables under the first version of  the Integrated Framework for Trade-Related Technical 
Assistance and Capacity Building for LDCs.  The main ou tcome from this roundtable has been the preparation 
of an Export Development Strategy and specific-sector studies on fisheries, groundnuts, horticulture, niche 
manufacturing, and tourism.  EAC WT/TPR/S/171/Rev.1 
 Page 7 
 
 
 Some of the main technical assistance needs in relation to customs are:  the training of officials in the 
implementation of the WTO Customs Valuation Ag reement, including training on post-clearance 
auditing, and anti-fraud techniques and control; and th e drafting or revision of legislation in specific 
areas.  The delivery of technical assistance in these areas would be part of a wider programme for the 
development of customs capacity, which is bei ng supported by the IMF and bilateral donors.  
6. The development and implementation of sta ndards and other technical requirements, 
including sanitary and phytosanitary (SPS) measures, are a key priority.  Regulations in these areas 
are still to be harmonized across EAC countries.  T echnical assistance thus could focus on ensuring 
that revised or newly drafted legislation is in conformity with rules and practices provided for in 
relevant international agreements , the development of implementing legislation, and the development 
of institutional capacity required for enforcement.  
7. Technical assistance needs for intellectual propert y protection relate to the revision of existing 
legislation, the drafting of new legislation, the development of implementation capacity, and 
enforcement issues for Kenya.  As  LDCs, Tanzania and Uganda were  granted an extension of the 
transition period for the implementation of the TRIP S Agreement until 1 July 2013, which was due to 
expire on 1 January 2006.15 
8. The EAC countries are currently involved in trade negotiations with regiona l partners, such as 
the Cotonou Agreement;  and within the WTO under the Doha Development Agenda.  The different 
negotiating mandates and  timetables are liable to place considerable stress on EAC countries' 
institutional capacities.  Technical assistance coul d focus on helping them to identify negotiating 
priorities, and to anchor these in thei r overall programme of trade reform.  
9. Supply-side constraints affecting the EAC me mbers are both of a generic (cross-cutting) 
nature and a sector-specific nature.  The former in clude the high cost and unreliability of certain 
public services – notably electricity and telecommunication services – and the high cost of private credit.  Most sector-specific constraints are discu ssed in detail in Chapter IV of the respective 
Annexes.  The most frequently identified needs are training in modern production and marketing 
techniques, and the provision of inputs and physical support facilities.   
10. Despite recognition by the EAC member states of the importance of trade and trade policy 
reform to their development prospects, trade policy h as yet to be integrated systematically into their 
development strategies. The discussion of trade policy tends to be dispersed across a number of policy 
statements whose relationship to each other is unclear.  One reason for this lack of integration is that 
trade-policy-making itself is not fully coordinated, as there is no operational structure to coordinate 
the work of the various departments and agencies involved in the formulation and implementation of 
trade policy, either at the national or EAC level.  A critical first step would be to achieve such 
coordination in trade-policy-making.  
(2) C
OMMON MARKET FOR EASTERN AND SOUTHERN AFRICA (COMESA) 
11. COMESA's aims are to deepen and expand th e integration process for member countries by 
adopting general measures to liberalize trade.16  These include the removal of all tariff and non-tariff 
barriers and the adoption of a common external ta riff;  free movement of capital, labour and goods, 
                                                           
15 WTO document IP/C/40, 30 November 2005. 
16 The COMESA members are: Angola, Burundi, Comoros, the Democratic Republic of Congo, 
Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Madagasc ar, Malawi, Mauritius, Namibia, Rwanda, Seychelles, 
Sudan, Swaziland, Uganda, Zambia, and Zimbabwe.  Lesotho, Mozambique, and Tanzania have withdrawn. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 8 
 
 
 and the right of establishment in the region;  the adoption of a common set of standards, technical 
regulations, quality-control procedures, certifi cation systems, and sanitary and phytosanitary 
regulations;  tax harmonization (including VAT and excise duties), and provisions on industrial 
cooperation in, for example, company law, intellectua l property, and investment;  implementation of a 
harmonized competition policy;  and the establishment of a monetary union.17  The COMESA has 
been notified to the WTO under the Enabling Clause.18 
12. COMESA's Common External Tariff (CET) was to be in place by 2004, with rates of 0%, 
5%, 15% and 30%, on capital goods, raw materials, intermediate, and final goods, respectively. 
However, the CET has not yet been implemented (July 2006);  and member states are conducting 
studies to reach a decision on the timing for its implementation.  Since most COMESA members have 
maximum tariff bands below 30%, discussions are unde r way on the possibility of reducing the agreed 
CET rate on final goods. On 31 Oct ober 2000, Djibouti, Egypt, Kenya19, Madagascar, Malawi, 
Mauritius, Sudan, Zambia, and Zimbabwe eliminated tariffs (on a reciprocal basis) on COMESA-originating products.  Burundi and Rwanda jo ined this free-trade area on 1 January 2004. 
13. There are four alternative origin criteria unde r COMESA:  that goods are wholly produced in 
the region using no outside materials;  the imported co ntent of goods is no more than 60% of the c.i.f. 
value of the total cost of materials used in produc tion;  that goods contain no less than 35% ex-factory 
value added 
20, reduced to 25% if the final product is consid ered to be of "particular importance" to 
the economic development of a member state21;  or that there is a change of tariff classification 
heading following transformation. 
14. A monetary harmonization programme is to be  implemented in four stages between 1992 and 
2025.  The last stage should result in a full-fledge d monetary union in which there will be either 
permanently fixed exchange rates or a single currency;  full harmonization of the member states' economic, budgetary, and monetary polici es;  full integration of the financial structure;  a pooling of 
exchange reserves;  and the establishment of a single monetary authority.  A coordination body 
composed of experts from central banks and minist ries of finance in the region has been set up to 
oversee implementation of the measures and ensure that the harmonization process makes progress 
towards monetary union. 
15. Several institutions have been established to assi st COMESA members in their development.  
The Eastern and Southern African Trade and De velopment Bank (PTA Bank) provides trade and 
project financing to public and private investors domiciled in a bank member state.
22  The COMESA 
Clearing House has diminished in importance follo wing liberalization of most members' foreign 
exchange regimes. Its role is being re-directed to wards improving the efficiency of clearing operations 
to complement the services offered by commercial banks;  providing traders with some form of 
                                                           
17 COMESA online information.  Availabl e at:  http//:www.comesa.org/obj.htm. 
18 WTO document WT/COMTD/N/3, 29 June 1995. 
19 Kenya has been allowed to continue to apply a non-preferential tariff on sugar from other COMESA 
members, until 28 February 2008, to protect its local industry. 
20 Value added is defined as the difference between the ex-factory cost of the finished product and the 
c.i.f. value of material inputs imported from outside the COMESA sub-region.  The minimum level of value 
added was reduced from 45% to 35% in 2000.  Egyp t maintains the 45% ex-factory value-added level. 
21 A long list of approved products is specified in the COMESA Treaty as being of particular 
importance to the economic development of the members. 
22 Not all COMESA members are members of the PTA Bank:  Angola, Namibia, the Seychelles, 
Swaziland, Uganda, and the Democratic Republic of the Congo are not members.  Egypt joined the Bank 
in 2000.  Since 1994, non-COMESA members have been permitted to become PTA Bank members;  these are 
Somalia, Tanzania, and, since 2001, China (P. R.). EAC WT/TPR/S/171/Rev.1 
 Page 9 
 
 
 political insurance on intra-regional trade;  and facilitating monetary and fiscal policy harmonization 
within the region. Kenya and Uganda are members of the PTA Re-Insurance Company (ZEP-RE), which assists the development of the insurance and re-insurance industry in the COMESA region. The 
Africa Trade Insurance Agency (ATIA), launched in  August 2001, is aimed at creating investor 
confidence by providing cover against political risk.
23  Although promoted by COMESA, membership 
of ATIA is open to all the member states of the African Union (section (4)(iii)). The COMESA Court of Justice became operational in 1998.  Its general jurisdiction is to adjudicate upon all matters that 
may be referred to it under the Treaty.  Kenya a nd Uganda have not been involved in any formal 
disputes within this framework. 
16. The protocol on free movement of persons is to  be implemented in several stages; the first 
stage of removing visa requirements was adopted in 2000. 
(3) S
OUTHERN  AFRICAN  DEVELOPMENT  COMMUNITY  (SADC) 
17. The SADC Treaty was signed in 1992 with the objective of creating a development 
community that would achieve economic integration, including trade.24  Through regional cooperation 
and integration, the Community aims to provide  balanced economic growth and development, 
political stability, and secur ity for all 14 members.25 Decisions and agreements are legally binding on 
members, and the Treaty provides for several protoc ols in specific areas, such as trade, finance, 
industry, agriculture, transport, and investment. 
18. The Trade Protocol, signed in 1996, is aimed at progressively establishing a SADC free-trade 
area, initially over eight years.  However, progress h as been slow.  The Protocol was implemented in 
September 2000 after ratification by 11 members.26  To establish the FTA, products have been 
grouped under three main categories (A, B, and C).  Category A (mostly capital goods and equipment) 
were liberalized in the first year;  Category B (e.g . goods that constitute important sources of customs 
revenue) are to be liberalized gradually, by 200827;  and Category C (products deemed sensitive by 
member states), which are limited to a maximum of 15% of each member's total merchandise trade, are to be liberalized by 2010.  In addition, a four th category of products (Category E), covers products 
ineligible for preferential treatment under general and security exceptions permissible under Articles 9 
and 10 of the Protocol:  these are expected to make up a small list of products, so that by 2010 about 
98% of intra-SADC merchandise trade will be duty-free.  The phase-down offers (i.e. under 
Categories B and C) are country specific.   
19. A draft regulation on mutual assistance and coop eration in customs matters was approved on 
31 March 2000;  this, inter alia , allows for joint inspections.
28  The SADC Subcommittee on Customs 
Cooperation and Trade Facilitation finalized discussions  on customs documentation (i.e. the format of 
bills of entry and certificates of origin), and co mmenced the monitoring process for removal of non-
tariff barriers by member states by establishing systems for electronic validation of certificates of origin. Substantial progress has already been made  on harmonizing customs and trade documentation. 
SADC rules of origin are being negotiated on a pr oduct-by-product basis. Negotiations on specific 
                                                           
23 Founding members of the ATIA are Burundi, Kenya, Malawi, Rwanda, Tanzania, Uganda, and 
Zambia.  Only Tanzania is a non-COMESA member.   
24 SADC replaced the Southern African Development Coordination Conference (SADCC).  
25 Angola, Botswana, the Democratic Republic of Congo, Lesotho, Malawi, Mauritius, Mozambique, 
Namibia, the Seychelles, Tanzania, South Africa, Swaziland, Zambia, and Zimbabwe. 
26 By September 2000, Angola, the Democratic Republic of Congo, and the Seychelles had not ratified 
the Protocol.  
27 Category A and B products cover an estimated 85% of goods traded among SADC members. 
28 Appendix I to Annex II of the SADC Protocol on Trade as amended. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 10 
 
 
 rules of origin are continuing for certain prod ucts, including wheat flour and products thereof, 
electrical products, and optical, photographic, measuring, and surgical instruments.29 
20. The long-term objective on sugar is to establish full liberalization of trade within the SADC 
region from 2013. This will depend on a review of the prevailing conditions five years after entry into 
force of the agreement. The SADC sugar market -access and cooperation agreement has now been  
incorporated as an Annex to the amended Trade Protocol.  
21. A derogation for textiles and clothing has been granted to least developed members of  SADC 
(Malawi, Mozambique, Tanzania, and Zambia) allowing them to export (duty free but subject to quota) single-stage produced textiles and clothi ng, for five years starting from 1 August 2001.
30 
Exports above the quota are subject to "double stage transformation" rules of origin. 
22. While the Trade Protocol has identified several non-tariff measures to be eliminated, such as 
import quotas, customs procedures, and export subs idies, it excludes other important non-tariff 
barriers (e.g. local-content requirements, levies and other charges, and import/export licensing).31   
23. The SADC Protocol on Tribunal provides for a tribunal to be established to adjudicate 
members' disputes arising from the treaty, and from s ubsidiary instruments, that cannot be settled by 
consultation.32  Its composition, powers, functions, pr ocedures, and other related matters are 
prescribed in the Protocol;  the rules of proce dure were agreed by SADC members in August 2000.33  
Creation of the Tribunal, however, will not take  place until after the conclusion of current 
reorganization plans for SADC;  decisions will be fi nal and binding.  In the meantime, Annex IV of 
the SADC Amendment Protocol of 2000 provides for a dispute settlement mechanism based on the 
WTO model. 
24. SADC intends to extend trade liberalization to services, but negotiations are yet to commence.  
The SADC Free Trade Area has been notified to the WTO.34 
(4) OTHER TRADE ARRANGEMENTS  
25. The EAC members are eligible for various non -reciprocal trade preferences from developed 
partners. However, their use of these preferences re mains limited.  Recent studies have attributed the 
under-performance of non-reciprocal preferential trad e arrangement schemes to a host of external 
factors.  They are observed to exclude, or include  on a limited basis, products in which developing 
countries have the greatest comparative advantag es (agricultural goods (processed products in 
particular), textiles, clothing and footwear), and fa ce MFN tariff peaks.  Burdensome rules of origin 
(e.g. a high value-added criterion) could serve as  a deterrent to small countries with limited 
technological capacity, and may pose problems for meeting the documentation requirements;  and 
stringent standards and technical regulations may add to these difficulties.  In addition, these 
preferences may be considered un certain because they can be revoked or modified unilaterally, and 
the provisions for graduating countries out of partic ular sectors could weaken the incentive for large-
                                                           
29 For example, for electrical mach inery, some members want to prevent "single assembly" of white 
goods, while for plastics they want to prevent the use of imported plastic waste (see WTO, 2003). 
30 Coughlin, P. and S. Undenge (2001). 
31 Imani Development (Malawi) Ltd. (2001). 
32 Article 32 of the Treaty. 
33 SADC online information.  Available a t:  http://www.sadc.int/overview/works.htm. 
34 WTO documents: WT/REG176/N1/Rev.1, 27 August 2004; WT/REG176/1, 8 October 2004; and 
WT/REG176/Rev.1, 19 November 2004. EAC WT/TPR/S/171/Rev.1 
 Page 11 
 
 
 scale investment in the activities concerned.  Uncerta inty is increased by the inclusion of various non-
trade (political, labour, social, and environmental) concerns as conditions for accessing all or certain 
aspects of the available preferences. Furthermore, even without these constraints, liberalization of 
preferential markets (including through the increasi ng number of regional trade agreements) continues 
to erode existing preferences.35 
(i) Cotonou Agreement, and the Everything- but-Arms (EBA) Initiative of the EC 
26. Kenya, Tanzania and Uganda are signatories to the Cotonou Agreement (successor to the 
Lomé Convention) between the EC and 78 African, Caribbean and Pacific (ACP) states, which was 
signed on 23 June 2000 and entered into force in April 2003.36  The agreement builds upon three 
interlinked pillars with the objective of reducing poverty: a political dimension; development and 
finance cooperation; and economic and trade coope ration. Under the former, political dialogue is 
focused on, inter alia ,  issues of mutual concern, such as ar ms trade, excessive military expenditure, 
drugs and organized crime, or ethnic, religious  or racial discrimination. The dialogue also 
encompasses a regular assessment on human rights, democratic principles, the rule of law and good governance.
37 
27. Under economic and trade cooperation, ACP countries benefit from non-reciprocal trade 
preferences during an interim period (2001-07).38 These include duty-free treatment on industrial, 
processed agricultural, and fishery products, subject  to a safeguard clause.  For certain products 
(bananas, beef and veal, sugar, and rice), the EC  provides special market access under "commodity 
protocols".  The preferential rules of origin contain product-specific requirements39, and allow for 
regional cumulation.  At the end of the interi m period (31 December 2007 at the latest), these 
unilateral preferences will be replaced by WTO- compatible reciprocal economic partnership 
agreements (EPAs) between th e EC and individual ACP countries or groups of countries.  
28. The primary objectives of the EPAs are to foster  sustainable development, integrate the ACP 
states into the world economy and fully comply with  the prevailing WTO rules.  The basic guiding 
principle for EPAs is to build on and reinforce ACP regional integration processes, and provide for 
appropriate differentiation and asymmetry to take  account of the level of development and their 
socio-economic impact on ACP countries.  EPAs will provide for the progressive elimination of tariffs and non-tariff measures between the parties, on both goods and services, and are expected to 
address other trade-related issues.
40  Development concerns will be reflected through flexibility 
                                                           
35 WTO (2005). 
36 The ACP states comprise 48 Af rican states, covering all sub-Sa haran Africa, 15 states in the 
Caribbean, and 15 states in the Pacific (the Democr atic Republic of East Ti mor acceded to the Cotonou 
Agreement in May 2003). 
37 As part of the first revision of the Cotonou Agreement, concluded on 23 February 2005, the parties 
agreed, inter alia , that additional financial and technical assistance will be granted for cooperation on non-
proliferation of weapons of mass destruction, which w ill not be funded from resources intended for ACP-EC 
development cooperation;  and to include, in the revise d agreement, a clause confir ming their cooperation in the 
fight against terrorism, as well as a provision relating to the prevention of mercenary activities (European 
Commission, 2005). 
38 The agreement is currently under a WTO waiver th at was approved at the Doha Ministerial Meeting 
and will expire on 31 Decembe r 2007 (WTO document WT/MIN(0 1)/15, 14 November 2001). 
39 The requirements relate to maximum import content, specific processing criteria, and change in tariff 
headings. 
40 These may include sanitary and phytosanitary measures, intellectual property rights, public 
procurement, competition policy, investment, trade and environment, trade and labour standards, consumer 
policy regulation and consumer health protection, st andardization and certification, and food security. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 12 
 
 
 vis-à-vis  depth of liberalization, its asymmetry, lengt h of transition periods, trade coverage and 
exceptions, and through assistance from the EC.  All EPA negotiations started formally, in 
September 2002, to define the format, structure, and principles for the negotiations, and horizontal issues of interests to all parties.  Kenya and Ug anda are participating in  the EPA negotiations as 
members of the Eastern and Southern Africa (ESA) region while Tanzania is participating under 
SADC. 
29. The EAC countries have received financial assistance from the EC under, inter alia,  the 
European Development Fund (EDF) through the nationa l or regional indicative programmes;  and the 
European Investment Bank for commercial loans. 
30. The EC adopted the EBA amendment to its GSP scheme on 26 February 2001.  The new 
regulation was applicable from 5 March 2001.  The EBA extends duty- and quota-free access to all 
products originating in the LDCs, except for ar ms and ammunition.  The programme includes all 
agricultural products, except fresh bananas, rice, a nd sugar.  Extension of the programme to these 
three commodities will follow specific schedules: 
− for fresh bananas, the EBA provides for full liberalization through reduction of the EC 2001 
tariff by 20% each year between 1 January 2002 and 1 January 2006; 
− for rice, full liberalization will be phased in  by gradually reducing the EC tariff to zero 
between 1 September 2006 and 1 September 2009.  In the meantime, LD C rice can enter duty 
free within the limits of a tariff quota.  The initial quantities of the quota are based on best 
LDC export levels to the EC in recent years,  plus 15%.  The quota will grow by 15% every 
year;  and  
− for sugar, full liberalization will be phased in  between 1 July 2006 and 1 July 2009 through 
gradual reduction of the EC tariff to zero.  In the meantime, LDC raw sugar can enter duty 
free within the limits of a tariff quota.  Th e quota will increase from 74,185 tons (white-sugar 
equivalent) in 2001/02 to 197,355 tons in 2008/09.
41 
(ii) African Growth and Opportunity Act (AGOA) 
31. Kenya, Tanzania, and Uganda are eligible fo r various trade preferences under the U.S. 
AGOA, contained in the U.S. Trade and Development Act 2000, as amended.42  The AGOA extends 
the product coverage of the U.S.  GSP scheme, but only to African countries.  Under the AGOA, 
eligible countries qualify for duty-free and quota-free access to the U.S. mark et (except for "wearing 
apparel" products) for a range of products, including selected agricu ltural and textile products until 
2015.43  To be eligible, African countries must make progress in:  establishing a market-based 
economy; developing the rule of law and political pl uralism; eliminating discriminatory barriers to 
U.S. trade and investment; protecting intellectual property; combating corruption; protecting human 
and worker rights;  and removing certain practices of child labour.44   
                                                           
41 Europa online information.  Available at:  http://europa.eu.int/comm/trade/miti/devel/eba4_sum.htm. 
42 The AGOA was revised in November 2003. 
43 Until its amendment in 2004, the AGOA was due to expire in 2008.  
44 African Growth and Opportunity Act online info rmation.  Available at: http://www.agoa.gov/ 
index.html. EAC WT/TPR/S/171/Rev.1 
 Page 13 
 
 
 32. AGOA eligibility does not automatically impl y eligibility for the "wearing apparel" 
provisions;  these are governed by a separate set of conditions and associated rules of origin.45  To 
export apparel (and certain textile items) to the United States duty-free under the AGOA, countries 
must implement a "visa system" that ensures complia nce with the required rules of origin.  Kenya, 
Tanzania, and Uganda were declared eligible fo r the preferences under the apparel provisions in 
July 2004.  
33. Measures implemented in order to better utilize the opportunities under the AGOA include:  
concessionary import duties of 2.5% on industrial e quipment used by the beneficiary country to 
produce AGOA exports, and the establishment of AGOA-dedicated desks at the country's ports. 
(iii) African Economic Community (AEC) and the African Union (AU) 
34. Kenya, Tanzania, and Uganda are members of the African Economic Community (AEC), 
which was established by the Abuja Treaty in June 1991.  The treaty provides for the creation of an 
African Common Market in six stages over a 34-year period.  A key aspect of this integration process is the coordination and harmoniza tion of tariff and non-tariff measu res, among various sub-regional 
trade groupings (referred to as regional economic groupi ngs), in order to create a continental customs 
union.  The AEC was established under the Orga nization of African Unity (OAU), which was 
succeeded by the African Union (AU).  The EA C is accredited by the AU as a regional block. 
35. The Constitutive Act of the AU was adopted in Lo mé in July 2000.  The AU was established 
with a view to, inter alia,  accelerating the process of regional integration, in order to enable Africa to 
play its "rightful role" in the global economy, wh ile addressing other forms of social, economic, and 
political problems on the continent.  The AU is bein g structured largely on the model of the European 
Union.  It would comprise a Council of Ministers, Commission, Parliament, Central Bank, Monetary Fund, Court of Justice, and a Security Council similar to that of the UN.  
36. One of the major initiatives under the AU is th e New Partnership for African Development 
(NEPAD).  The goals of NEPAD are to halt the marginalization of Africa in the globalization process; to eradicate widespread and sever e poverty; and to promote accelerated growth and sustainable 
development.  Trade and trade -related measures outlined under NEP AD to promote African exports 
include:  promotion and improvement of regi onal trade agreements;  inter-regional trade 
liberalization;  harmonization of tariffs, rules of origin, and product standa rds; reduction of export 
taxes, and of costs of transactions and operati ons; and promotion of African exporting and importing 
companies.  NEPAD also aims to ensure the active participation of African countries in the 
multilateral trading system.  In this respect, NEPAD supports the view that multilateral trade 
negotiations must take into account Africa's spec ial concerns.  In addition, African States are 
encouraged to tackle supply-side impediments to  export production; diversify exports;  give the 
necessary political impetus to deepen the various in tegration initiatives on the continent;  and secure 
and stabilize preferential treatment by  key developed country partners. 
(iv) Regional Integration Facilitation Forum (RIFF) 
37. The Regional Integration Facilitation Forum, fo rmerly known as the Cross-Border Initiative 
(CBI), aims to move member countries (includi ng EAC member states) towards increased economic 
integration by facilitating private investment, tr ade, and payments between them, as well as 
                                                           
45 Under the AGOA amendments, the waiver from the normal rules of origin for wearing apparel, as 
applicable to "lesser developed beneficiary countries", has been extended from September 2004 to 
September 2007. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 14 
 
 
 cross-border mobility of labour and capital. Member  states are countries in eastern and southern 
Africa and the Indian Ocean.46 
38. The RIFF was developed in close collaboration with the economic integration organizations 
in the region:  as a forum, it is to reinforce and complement their efforts.  Launched in 1992, the RIFF 
is co-sponsored by the European Commission, the In ternational Monetary Fund, the World Bank, and 
the African Development Bank. It has no Secretaria t at the regional level and works on a voluntary 
basis. 
(v) Intergovernmental Author ity on Development (IGAD) 
39. Formerly known as the Inter-Governmental  Authority for Drought and Development 
(IGADD)47, the IGAD was set up in January 1986 by seven east African countries:  Djibouti, 
Ethiopia, Eritrea, Kenya, Somalia, Sudan, and Ug anda.  Its initial aim was to combat drought and 
desertification.  In March 1996, at a summit held  in Nairobi, the IGAD adopted a new charter to 
revive and expand its mandate to include new prio rity areas, such as economic cooperation, conflict 
prevention, and the resolution and management of humanitarian affairs.  IGAD obtained official recognition from the Organization of African Unity (now the African Union) as a regional economic 
organization in June 1997, and started to focus more on economic integration.
48 
(vi) Indian Ocean Rim-Association for Regional Cooperation (IOR-ARC)  
40. Formerly known as the Indian Ocean Rim Initiative, the IOR-ARC was established in 
Mauritius in March 1997.49  Under its Charter, the IOR-ARC aims to build and expand mutually 
beneficial cooperation through a consensus based, e volutionary, and non-intrusive approach.  One of 
the main objectives of the Association is to eliminate tariffs, for all its members, by 2020.  Some other 
key objectives are:  (i) promotion of sustained grow th and balanced developmen t of the region and its 
members, and creation of common ground for region al economic cooperation;  (ii) formulation and 
implementation of projects for economic cooperation on, inter alia , trade facilitation, promotion of 
foreign direct investment, scientific and technologi cal exchanges, tourism, movement of natural 
persons and services providers on a non-discriminatory basis;  (iii) strengthening cooperation and 
dialogue among its members on global economic issues,  and where desirable, development of  shared 
strategies and common positions on issues of mutual in terest;  and (iv) fostering cooperation in the 
development of human resources, particularly th rough closer linkages among training institutions, 
universities and other specialized institutions. 
41. The highest authority of the association is th e Council of Foreign Ministers (COM), which 
inter alia , formulates policy, reviews progress on coopera tion issues, makes decisions on new areas of 
cooperation and on the establishment of additional m echanisms or matters of general interest. The 
                                                           
46 The RIFF currently comprises:  Burundi, Co moros, Kenya, Madagas car, Malawi, Mauritius, 
Namibia, Rwanda, the Seychelles, Swaziland, Tanzania, Uganda, Zambia, and Zimbabwe. 
47 In March 1996, at a summit in Nairobi, the IG ADD was renamed the Intergovernmental Authority on 
Development (IGAD). 
48 For further details, see IGAD online information.  Available at:  http://www.igad.org/ 
[7 March 2006]. 
49 Currently, the IOR-ARC members are:  Australia, Bangladesh, I ndia, Indonesia, Iran, Kenya, 
Madagascar, Malaysia, Mauritius, Mozambique, Oman, Singapore, South Africa, Sri Lanka, Tanzania, 
Thailand, United Arab Emirates, and Yemen.  China, Egypt, France, Japan, and the United Kingdom were 
accepted as official dialogue partners, while the Seychelle s withdrew as a member on 1 July 2003.  For further 
details, see Department of Foreign Affairs online information.  Available at:  http://www.dfa.gov.za/ 
foreign/Multilateral/inter/iorarc.htm [8 March 2006]. EAC WT/TPR/S/171/Rev.1 
 Page 15 
 
 
 Committee of Senior Officials (CSO), composed of government officials, reviews the implementation 
of the COM decisions.  In cooperation with the Indian Ocean Rim Business Forum (IORBF) and the 
Indian Ocean Rim Academic Group (IORAG), th e CSO also establishes economic cooperation 
priorities, and develops, monitors , and coordinates work programmes.  The Working Group on Trade 
and Investment (WGTI) was established in 1999;  its main objectives are trade facilitation, trade 
liberalization, and economic and technical coopera tion.  An IOR-ARC Coordinating Secretariat, 
based in Mauritius, coordinates, services, and m onitors the implementation of policy decisions and 
work programmes.  A High Level Ta sk Force (HLTF) was established in April 2001 with a view to 
studying the future direction of the Association. 
(vii) Generalized System of Preferences (GSP) 
42. The EAC countries also benefit from non-reci procal preferential treatment from many 
industrialized countries under the Generalized System of Preferences. WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 16 
 
 
 III. COMMON TRADE POLICY MEASURES 
(1) INTRODUCTION  
1. Applied customs tariffs, rules of origin, im port prohibitions, and trade remedy regulations 
have been harmonized through the East African Community (EAC).  The EAC common external 
tariff entered into force in January 2005, with an  average applied MFN rate of 12.9%.  Tariffs on 
agricultural goods (WTO definition) remain relativ ely high, with an average of 19.7%.  Around 99% 
of all tariff lines carry rates of 0%, 10%, or 25%;  some 58 tariff lines carry higher rates, mainly on dairy goods, wheat, and sugar.  The move from na tional tariffs to the common external tariff has 
reduced average tariff protection in Kenya a nd Tanzania, and increased it in Uganda.   
2. The free-trade area component of the customs union has implied the dismantling of tariffs on 
most intra-EAC trade.  Nonethel ess, tariffs remain in place on exports of 880 items from Kenya to 
Tanzania, and 443 items from Kenya to Uganda, and ar e to be phased out by 2010.  Members are also 
committed to removing non-tariff barriers on intra-EAC trade, but have been slow in dismantling 
them;  regulations on import prohib itions have been harmonized.   
3. While the EAC has adopted regulations on contingency measures, no anti-dumping, 
countervailing or safeguard actions have yet been  taken.  The EAC is increasingly adopting joint 
standards;  as at September 2005, 566 joint standa rds had been adopted by the EAC.  The EAC has 
also adopted provisions that allow  member states to establish manufacturing under bond schemes, 
export processing zones, and duty drawback schemes;  sales of goods within the customs territory, 
under any such scheme, is limited to 20% of production.  An EAC Competition Law is under 
consideration (as at July 2006). 
(2) C
USTOMS PROCEDURES  
(i) Customs clearance and valuation 
4. The principles of EAC customs procedures and valuation are laid down in the EAC Customs 
Management Act 2004.  Nonetheless, in practice, cu stoms procedures have not been fully harmonized 
by EAC members. Customs valuation is based on the transaction value as provided for by the WTO 
Agreement on Implementation of Article VII of GATT 1994. 
(ii) Rules of origin 
5. The EAC rules of origin are laid down in Anne x III to the Protocol on the establishment of 
the customs union.  Goods are defined as originati ng in the country where they are wholly produced 
or undergo substantial transformation.  The criterion of substantial transformation is satisfied if the 
imported content of the goods is no more than 60% of the c.i.f. value of the cost of materials used in 
their production, and the value-added resulting fro m the production process (that should lead to a 
change in tariff heading) accounts for at least 35% of  the ex-factory cost of the goods.  In order to 
qualify as originating in the region, goods must be  consigned directly from a member state.  The 
Annex also provides for a model certificate of origin. EAC WT/TPR/S/171/Rev.1 
 Page 17 
 
 
 (3) T ARIFFS , AND OTHER DUTIES AND CHARGES  
(i) MFN applied tariff structure 
6. The EAC tariff is based on the 2002 version of the Harmonized Commodity and Coding 
System (HS).  Tariffs are applied on the c.i.f. value of imports at the point of entry to the customs union.  There are few national exemptions from th e EAC common external tariff:  for a period of 
24 months ending on 30 June 2008, Kenya is allo wed to impose lower tariffs on rice imports from 
Pakistan.  Over the same period, Tanzania is a llowed to impose lower tariffs on imports of wheat 
(10% instead of 25%) and barley (0% instead of 10%).  The 2005 tariff contains 5,429 lines at the 
HS eight-digit level, of which 99.8% carry ad valorem  duties (Table III.1);  the other lines carry 
compound tariffs.  There are no seasonal or variable tariffs, or tariff quotas.  Some 36.2% of tariff lines are duty free, up from 16.4% in 2000 for Uganda, 1.7% in 1999 for Tanzania, and 3.7% in 1999 for Kenya (Chart III.1).  Some 99% of all tariff lin es carry rates of 0%, 10% , or 25%, with 25% being 
the modal rate and applicable to 40% of all tariff lines.  Some 58 tariff lines of "sensitive" items carry 
higher rates (Table III.2).  The products concer ned include dairy goods, wheat, and sugar.  
Table III.1 
Structure of MFN tariffs in the EAC, 2006 
(Per cent) 
U.R. 
 MFN 
2006 Kenya Tanzania Uganda 
1.   Bound tariff lines (% of all tariff lines) .. 14.9 13.5 15.9 
2.   Duty-free tariff lines (% of all tariff lines) 36.2 0.0 0.0 0.0 
3.   Non- ad valorem  tariffs (% of all tariff lines) 0.2 0.0 0.0 0.0 
4.   Tariff quotas (% of all tariff lines) 0.0 0.0 0.0 0.0 
5.   Non- ad valorem  tariffs with no AVEs (% of all tariff lines) 0.2 0.0 0.0 0.0 
6.   Simple average tariff rate 12.9 95.6 120.0 73.3 
 Agricultural products (WTO def.)a 19.7 100.0 120.0 77.5 
 Non-agricultural products (WTO def.)b 11.8 54.4 120.0 50.4 
 Agriculture, hunting, forestry and fishing (ISIC 1) 17.3 96.5 120.0 75.1 
 Mining and quarrying (ISIC 2) 5.3 .. .. .. 
 Manufacturing (ISIC 3) 12.7 95.1 120.0 72.5 
7    Domestic tariff "spikes" (% of all tariff lines)c 0.8 0.0 0.0 0.0 
8.   International tariff "spikes" (% of all tariff lines)d 41.1 100.0 100.0 100.0 
9.   Overall standard deviation of applied rates 11.9 14.3 0.0 13.1 
10. "Nuisance" applied rates (% of all tariff lines)e 0.0 0.0 0.0 0.0 
.. Not available. 
a WTO Agreement on Agriculture. 
b Excluding petroleum. 
c Domestic tariff spikes are defined as those exceeding three times the overall simple average applied rate (indicator 6). 
d International tariff peaks are defined as those exceeding 15%. 
e Nuisance rates are those greater than zero, but less than or equal to 2%. 
Source:  WTO Secretariat calculations , based on data provided by the EAC;  and CTS database.  
 WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 18 
 
 
 (0.4)(36.2)
(22.7)(40.0)
(0.3) (0.4)
05001,0001,5002,0002,500
0% 10% 25% 35% 40-50% >500102030405060708090100
The figures in brackets correspond to the percentage of total lines. 
WTO Secretariat calculations, based on data provided by the authorities of the East African Community 
countries.Chart III.1
Breakdown of applied MFN tariffs, 2006
Number of tariff lines
Note:
Sourc e:Percentage
Number of lines
Cumulative percentage (right-hand scale)
 
Table III.2 
"Sensitive" products subj ect to high tariffs, 2006 
  HS code Description MFN duty 
    Milk and cream not concentrated nor containing added sugar   
1 0401.1000 -  Of a fat content, by weight, not exceeding1% 60% 
2 0401.2000 -  Of a fat content, by weight, exceeding 1% but not exceeding 6% 60% 
3 0401.3000 -  Of a fat content, by weight, exceeding 6% 60% 
    Milk and cream concentrated or containing added sugar   
4 0402.1000 -  In powder, granules or other solid forms, of a fat content, by weight, not 
 exceeding 1.5% 60% 
5 0402.2110 - Specially prepared  for infants 60% 
6 0402.2190 - Other 60% 
7 0402.2910 - Specially prepared  for infants 60% 
8 0402.2990 - Other 60% 
9 0402.9110 - Specially prepared  for infants 60% 
10 0402.9190 - Other 60% 
11 0402.9910 - Specially prepared  for infants 60% 
12 0402.9990 - Other 60% 
    Wheat and meslin other than durum wheat   
13 1001.9020 -  Hard wheat 35% 
14 1001.9090 -  Other 35% 
15 1005.9000  - Maize (corn) other than seed 50% 
16 1006.1000  - Rice in the husk (paddy or rough) 75% or US$200/MT whichever is higher 
17 1006.2000  - Husked (brown) rice 75% or US$200/MT whichever is higher 
18 1006.3000  - Semi-milled or wh olly milled rice, whether or no t polished or glazed 75% or US$200/MT whiche ver is higher 
19 1006.4000  - Broken rice 75% or US$200/MT whichever is higher 
Table III.2 (cont'd) EAC WT/TPR/S/171/Rev.1 
 Page 19 
 
 
   HS code Description MFN duty 
20 1101.0000 Wheat or meslin flour. 60% 
21 1102.2000 -  Maize (corn) flour 50% 
    Cane sugar   
22 1701.1110 -  Jaggery 35% 
23 1701.1190 -  Other 100% or US$200/MT whichever is higher 
    Beet sugar   
24 1701.1210 - Jaggery 35% 
25 1701.1290 - Other 100% or US$200/MT whichever is higher 
26 1701.9100 - Other sugar containing added flavouring or colouring matter 100% or US$200/MT whichever is higher 
27 1701.9910 - Other sugar for industrial use 100% or US$200/MT whichever is higher 
28 1701.9990 - Other sugar 100% or US$200/MT whichever is higher 
29 2402.2010 - Cigarette s not exceeding 72 mm in lengt h including the filter tip 35% 
30 2402.2090 - Other 35% 
31 2403.1000 - Smoking tobacco, whether or not containing tobacco substitutes  35% 
32 2523.2900 - Portland cement other than white 55% 
33 3605.0000 Matches, other than pyrotechnic articles of heading 36.04 50% 
34 5208.5110 -  Khanga, Kikoi, and Kitenge 50% 
35 5208.5210 -  Khanga, Kikoi, and Kitenge 50% 
36 5209.5110 -  Khanga, Kikoi, and Kitenge 50% 
37 5210.5110 -  Khanga, Kikoi, and Kitenge 50% 
38 5211.5110 -  Khanga, Kikoi, and Kitenge 50% 
39 5212.1510 -  Khanga, Kikoi, and Kitenge 50% 
40 5212.2510 -  Khanga, Kikoi, and Kitenge 50% 
41 5513.4110 -  Khanga, Kikoi, and Kitenge 50% 
42 5514.4110 -  Khanga, Kikoi, and Kitenge 50% 
43 6211.4210 -  Khanga, Kikoi, and Kitenge 50% 
44 6211.4310 -  Khanga, Kikoi, and Kitenge 50% 
45 6211.4910 -  Khanga, Kikoi, and Kitenge 50% 
46 6302.2100 -  Bed linen, printed, other than knitted or crocheted, of cotton 50% 
47 6302.3100 -  Bed linen, not printed, other than knitted or crocheted, of cotton 50% 
48 6302.5100 -  Table linen, other than knitted or crocheted, of cotton 50% 
49 6302.9100 -  Other toilet linen and kitchen linen than of terry towelling, of cotton 50% 
50 6305.1000 -  of jute or of other textile bast fibres of heading 53.03 35%  
51 6309.0000 Worn clothing and other worn articles. 45% or US$0.3/kg whichever is higher 
52 8309.1000 -  Crown corks 40% 
53 8506.1000 -  Manganese dioxide 35% 
54 8506.3000 -  Mercuric oxide 35% 
55 8506.4000 -  Silver oxide 35% 
56 8506.5000 -  Lithium 35% 
57 8506.6000 -  Air-zinc 35% 
58 8506.8000 -  Other primary cells and primary batteries 35% 
Source: WTO Secretariat estimates, based on data provided by the authorities.  
7. The average applied MFN tariff was 12.9% in 2005 (Table III.3).  The coefficient of variation 
of 0.92 indicates moderate tariff dispersion.  MFN tariffs on non-agricultural products (WTO 
definition) are slightly lower, with an average of 11.9%;  the tariffs on agricultural goods remain 
relatively high, with an average of 19.7%:  tariffs are particularly high on dairy products (with an 
average rate of 42.5%), grains (28.3%), and t obacco (28.0%).  Tariffs are relatively low on non-
electric machinery (with an average rate of 3.5%),  chemicals and photographic supplies (4.5%),  and cut flowers and plants (5.4%).  Using the ISIC (Rev ision 2) definition of sectors, agriculture, hunting, 
forestry, and fishing has the highest tariffs (17. 3% on average), followed by manufacturing (12.8%), 
and mining and quarrying (5.8%).  The food industr y is the most protected activity (Chart III.2). WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 20 
 
 
 Table III.3 
Summary analysis of the East African Customs Union MFN tariff, 2006  
Applied 2006 rates Imports 2004 (US$ million) 
Analysis No. of 
linesa No. of 
lines  
used Simple 
avg. tariff
(%) Range 
tariff  
(%) Std-dev 
(%) CV Kenya Tanzania Uganda 
Total 5,429 5,428 12.9 0-100 11.9 0.9  4,563.4 2,531.2 1,656.6 
By WTO definitionb                    
Agriculture 729 729 19.7 0-100 13.9 0.7  494.9 391.9 283.2 
Live animals and products thereof 97 97 23.2 0-25 6.5 0.3  1.1 3.6 1.1 
Dairy products 24 24 42.5 25-60 17.9 0.4  3.3 3.1 2.1 
Coffee and  tea, cocoa, sugar, etc. 134 134 24.6 0-100 17.2 0.7  102.0 69.6 56.4 
Cut flowers and plants 37 37 5.4 0-25 6.8 1.3  10.6 0.5 0.6 
Fruit and vegetables 155 155 24.8 10-25 1.7 0.1  11.5 5.6 15.0 
Grains 21 21 28.3 0-75 27.4 1.0  183.8 191.6 110.3 
Oil seeds, fats, oils and their 
products 77 77 12.6 0-25 8.7 0.7  116.5 82.7 68.6 
Beverages and spirits 41 41 24.6 10-25 2.3 0.1  18.4 14.7 11.8 
Tobacco 10 10 28.0 25-35 4.8 0.2  27.1 4.5 2.0 
Other agricultural products 133 133 6.9 0-25 8.8 1.3  20.7 16.0 15.1 
Non-agriculture (excl. petroleum) 4,673 4,672 11.9 0-55 11.2 0.9  2,991.8 1,738.6 1,214.7 
Fish and fishery products 117 117 24.1 0-25 4.2 0.2  5.9 0.6 0.6 
Mineral products, precious stones 
and precious metals 336 336 13.9 0-55 10.8 0.8  233.9 124.7 90.2 
Metals 615 615 9.6 0-40 9.1 0.9  411.4 195.3 145.3 
Chemicals and photographic 
supplies 904 904 4.5 0-25 8.6 1.9  585.7 306.7 220.8 
Leather, rubber, footwear and travel 
goods 167 167 12.7 0-25 9.2 0.7  70.8 62.6 54.4 
Wood, pulp, paper and furniture 269 269 16.5 0-25 10.7 0.6  265.5 105.7 95.5 
Textiles and clothing 872 871 21.4 0-50 8.6 0.4  159.9 102.5 90.5 
Transport equipment 156 156 7.3 0-25 9.7 1.3  458.3 254.2 158.0 
Non-electric machinery 533 533 3.5 0-25 6.7 1.9  360.5 358.3 150.6 
Electric machinery 259 259 11.2 0-35 10.1 0.9  264.2 148.7 149.9 
Non-agricultural articles n.e.s. 445 445 15.3 0-35 10.9 0.7  175.7 79.2 58.9 
By ISIC sectorc           
Agriculture, hunting, forestry, and 
fishing 308 308 17.3 0-75 12.3 0.7  206.4 162.5 100.5 
Mining 105 105 5.8 0-25 8.2 1.4  576.2 9.7 12.9 
Manufacturing 5,015 5,014 12.8 0-100 11.9 0.9  3,780.8 2,359.0 1,543.3 
By stage of processing           
Raw materials 652 652 13.5 0-75 13.0 1.0  921.7 262.5 180.1 
Semi-processed products 1,793 1,792 10.1 0-100 12.0 1.2  1,028.8 473.5 348.0 
Fully-processed products 2,984 2,984 14.4 0-60 11.4 0.8  2,612.8 1,795.2 1,128.5 
a Total number of lines is listed.  Tariff rates are based on a lower frequency (number of lines) since lines with no ad valorem  equivalents 
are  excluded.  
b Twenty seven tariff lines are excluded from both WTO agriculture and non-agriculture definitions (essentially petroleum produ cts). 
c International Standard Industrial Classification (Rev.2).  Electricity, gas, and water are excluded (one tariff line). 
Note: CV = coefficient of variation. 
Source : WTO Secretariat estimates, based on data provided by the EAC authorities;  and Imports 2004 from UNSD, 
Comtrade database. 
 
 EAC WT/TPR/S/171/Rev.1 
 Page 21 
 
 
 0102030405060708090100110
111
122
210
230
311
313
321
323
331
341
351
353
355
361
369
372
382
384
390Chart III.2
EAC's tariff by ISIC classification, 2006
Percent
WTO Secretariat calculations, based on data provided by the EAC authorities.AverageMaximu m
Minimu m
International Standard Industrial Classification, Revision 2
Source :111 
121 122130
210
220230390
311
312313314
321
322323
324
331332
341
342Description
Agricultural and livestock production
ForestryLoggingFishing
Coal mining
Crude petroleum and natural gas productionMetal ore miningOther mining
Food production
Other food products and animal feedsBeveragesTobacco manufacturing
Textiles
Manufacture of wearing apparel, except footwearLeather products, except footwear and wearing apparel
Footwear, except vulcanized rubber or plastic footwear
Wood and wood products, except furnitureManufacture of furniture and fixtures, except primarily of metal
Paper and paper products
Printing, publishing and allied industriesDescription
Industrial chemicals
Other chemicals, including pharmaceuticalPetroleum refineriesManufacture of miscellaneous petroleum and coal
products
Manufacture of rubber products n.e.s.Manufacture of plastic products n.e.s.Pottery, china and earthenware
Manufacture of glass and glass products
Other non-metallic mineral productsIron and steel basic industriesNon-ferrous metal basic industries
Fabricated metal products, except machinery and 
equipmentNon-electrical machinery including computersElectrical machinery apparatus, appliances and 
supplies
Transport equipmentProfessional and scientific equipmentOther manufacturing industries
Electrical energy351
352353354
355
356361
362
369371372
381
382
383
384
385390
410
 WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 22 
 
 
 8. In aggregate, the EAC's tariff shows a pattern of mixed escalation:  negative from the first 
stage of processing (with an average tariff of 13.5%)  to semi-finished products (with an average of 
10.1%), and then positive to fu lly processed goods on which tariffs average 14.4%.  Further 
disaggregation of the tariff at ISIC (Revision 2)  two-digit level shows positive escalation mainly in 
the textiles and apparel industry, with average tari ffs of 2.3% for products at the first stage of 
processing, 19.9% for semi-processed goods, and 24. 2% for fully processed goods (Chart III.3). 
0,05,010,015,020,025,030,035,0Chart III.3
Tariff escalation by ISIC 2-digit industry, 2006
Per cent
WTO Secretariat estimates, based on data provided by the authorities of the East African Community countries.All product s
Food, beverages
Textiles,
apparel
Wood products
Paper, printing
Chemicals ,
plastics
Non-metalli c
minera l
products
Basic meta l
products
Fabricated meta l
products
Other
manufacturin gNOT APPLICABLEAgriculture
MiningRaw materials Semi-processed Fully processed
NOT APPLICABLE
Sourc e: 
9. The EAC member states have bound their tariffs individually.  Bindings cover between 13.5% 
and 15.9% of all tariff lines: all tariffs on agricu ltural products and betwee n 0.1% and 2.9% of non-
agricultural products, depending on the member stat e (see Annexes).  For 11 lines, applied compound 
tariffs could exceed bound ad valorem  rates, depending on the unit import price of the product 
(Table III.4). 
Table III.4 
Products for which applied MFN rates may be higher than the final bound rate, 2006 
Bound rates (UR) HS code Description Applied MFN tariff  
Kenya Tanzania Uganda 
1006.1000 -  Rice in the husk (paddy or rough) 75% or US$200/MT whichever is higher 100% 75% 75% 
1006.2000 -  Husked (brown) rice 75% or US$200/MT whichever is higher 100% 75% 75% 
1006.3000 -  Semi-milled or wholly milled rice, 
 whether or not polished or glazed 75% or US$200/MT whichever is higher 100% 75% 75% 
1006.4000 -  Broken rice 75% or US$200/MT whichever is higher 100% 75% 75% 
1701.1110 -  Jaggery  100% or US$200/MT whichever is higher 100% 100% 100% 
1701.1190 -  Other 100% or US$200/MT whichever is higher 100% 100% 100% 
Table III.4 (cont'd) EAC WT/TPR/S/171/Rev.1 
 Page 23 
 
 
 Bound rates (UR) HS code Description Applied MFN tariff  
Kenya Tanzania Uganda 
1701.1210 - Jaggery 100% or US$200/MT whichever is higher 100% 100% 100% 
1701.1290 -  Other  100% or US$200/MT whichever is higher 100% 100% 100% 
6305.1000 -  Of jute or of other textile bast fibres of 
 heading 53.03 45% or US$0.45 per bag whichever is higher 45% 45% 45% 
6309.0000 Worn clothing and other worn articles. US$0.75/kg. or 50% whichever is higher 50% 50% 50% 
Source:  WTO Secretariat estimates, based on online data;  and CTS, WTO database.  
(ii) Tariff preferences 
10. In accordance with Article 10 of the Protoc ol on the Establishment of the EAC Customs 
Union, members began eliminating tariffs on in tra-EAC trade in January 2005.  Tariffs were 
abolished completely on trad e between Uganda and Tanzania , and on exports from these two 
countries to Kenya.  However, various goods (t he so-called Category B goods) exported from Kenya 
to Tanzania or Uganda continue to be  subject to tariffs (Chapter I(2)).  
11. EAC members also grant tariff preferences on a reciprocal basis under trade agreements in 
which they participate individually.  Consequently, tariff preferences may differ from one country to another. 
12. Since 2004, negotiations on an Economic Partne rship Agreement have been going on between 
the EAC and the European Union.   
(iii) Duty and tax exemptions and concessions 
13. EAC members have agreed to  harmonize their duty and tax exemption and concession 
schemes.  However, these have not yet been harmoni zed and are still laid down in national laws (as at 
July 2006).   
(iv) Other duties and charges 
14. EAC members have bound other duties and charges individually.  No  import duties, other 
than tariffs, are provided for by the EAC trade re gime.  However, members individually impose other 
duties and charges.  Moreover, internal taxes have not yet been harmonized. 
(4) C
ONTINGENCY MEASURES  
15. No anti-dumping, countervailing or safeguard measures have been taken by EAC members 
since 2000. 
16. Provisions on contingency measures are laid dow n in Articles 16 to 20 and Article 24 of the 
Protocol on the Establishment of the East African Customs Union.  Article 20 of the Customs Union 
Protocol calls upon member states  to cooperate in the detecti on and investigation of dumping, 
subsidies, and sudden surge in imports, and in the imposition of measures to curb such practices.  The 
Protocol also provides for the establishment of  an East African Community Committee on Trade 
Remedies.  This Committee is to handle any ma tters pertaining to anti-dumping, safeguard, and 
countervailing measures.  It is composed of nine members, of which each member state may nominate three.  The Committee determines its own procedur es and has the following functions:  initiation of 
investigations, through the investigating authori ties of member states;  affirmative or negative 
determinations on investigations ;  recommendation of provisional measures to prevent injury to a WT/TPR/S/171/Rev.1 Trade Policy Review 
Page 24 
 
 
 domestic industry where preliminary affirmative determination has been  made;  and annual review of 
the implementation of measures.  
17. Dumping is prohibited if it causes or threatens to cause material inju ry to an established 
industry in any of the member states;  materially re tards the establishment of a domestic industry;  or 
frustrates the benefits expected from the remo val or absence of duties and quantitative trade 
restrictions between the member states.  Provisi ons on the implementation of anti-dumping measures 
are laid down in Annex IV to the Customs Union Protocol. 
18. Safeguard measures may be applied by member st ates  in situations where there is a sudden 
surge in imports of a product into a member stat e under conditions that cause or threaten to cause 
serious injury to domestic producers.  During a transitional period until 2009, member states  may 
propose to the EAC Council to take safeguard measur es if an injury results from the imposition of the 
common external tariff.  Provisions on the implem entation of safeguard measures are laid down in 
Annex VI to the Customs Union Protocol. 
19. The EAC may impose countervailing measures for the purpose of offsetting the effect of 
subsidies.  The countervailing duty shall be equal to  the amount of the subsidy estimated to have been 
granted on the production or export of the good.  Provisions on the implemen tation of countervailing 
measures are laid down in Annex V to the Customs Union Protocol. 
(5) I MPORT PROHIBITIONS , RESTRICTIONS , AND LICENSING  
20. The Second Schedule to the EAC Customs Mana gement Act contains a list of prohibited 
imports.  The list includes:  pornographic materi al, narcotic drugs, hazardous wastes and their 
disposal, used tyres, and various agricultural and i ndustrial chemicals.  In addition, the Act allows 
EAC member states to maintain their import prohib itions in force for a transitional period.  The 
Second Schedule also contains an import permit requirement for 31 product groups, including arms 
and ammunition, worked and unworked ivory, ozon e-depleting substances, genetically modified 
products, non-indigenous species of fish, historical artefacts, and endangered species of world flora 
and fauna in accordance with CITES.  
(6) S TANDARDS AND OTHER TECHNICAL REQUIREMENTS  
21. Article 13 of the Protocol on the Establishmen t of the East African Customs Union obliges 
members states  to remove all non-tariff barriers (N TBs), with immediate effect, and not to impose 
any new ones.  Furthermore, EAC member states must formulate a mechanism for identifying and 
monitoring the removal of NTBs, including standa rds and technical requirements.  Substantial 
progress has still to be achieved in this direction.  
22. The adoption of joint standards is an important  objective for the EAC.  As at September 2005, 
566 joint standards had been adopted by the EAC.  The East African Standards Committee develops 
new standards or harmonizes existing ones;  it is composed of representatives of the three national bureaux of standards and of the private sector.  It has four technical subcommittees: on standards, quality assurance, metrology, and testing.  The initiati ve to develop or harmonize standards may come 
from member states.  The common standards/techni cal requirements are adopted by the Council of 
Ministers. EAC WT/TPR/S/171/Rev.1 
 Page 25 
 
 
 (7) E XPORT PROHIBITIONS , RESTRICTIONS , AND LICENSING  
23. The export of goods listed in Part A of the Third Schedule of the EAC Customs Management 
Act is prohibited.  The list does not contain any ite ms, but refers to export prohibitions decided and 
enforced by individual member states. 
24. Export authorization is required for products liste d in Part B of the Third Schedule.  Items on 
this list include:  waste and scrap of ferrous cast iron, timber from wood grown in EAC member states, fresh unprocessed fish (Nile perch and tilapia) , cloves, and wood charcoal.  In addition, under 
legislation in force as at January 2005, EAC memb ers may impose export authorization requirements. 
(8) E
XPORT ASSISTANCE  
25. The export assistance regime is yet to be fully harmonized at the EAC level.  Both the EAC 
Customs Management Act and the Protocol on the Establishment of the East African Customs Union 
contain provisions that allow  member states  to establish manufacturing under bond, export 
processing zone, and duty drawback schemes.  Pursuant  to Article 25 (3) of the Protocol, the sale of 
goods, in the customs territory, under any of these schem es is subject to authorization by a competent 
authority and limited to 20% of the annual production of the company. Pursuant to the Third Schedule 
of the Customs Management Act, warehoused goo ds and goods under duty drawback shall not be 
exported in vessels of less than 250 tonnes register. 
26. The Africa Trade Insurance Agency (ATIA), a multilateral agency established in 2001, 
provides insurance against political risk.  The par ticipating countries are Burundi, Kenya, Malawi, 
Tanzania, Uganda, and Zambia.  ATIA's main objec tive is to facilitate access to, and improve the 
terms of trade finance for participating countries.   The beneficiaries of ATIA include foreign 
companies exporting goods or services to partic ipating countries, companies from participating 
countries that are exporting goods or services, and banks engaged in export financing.  
(9) C OMPETITION POLICY AND REGULATORY ISSUES  
27. Article 21 of the Protocol on the Establishm ent of the EAC Customs Union obliges member 
states  to prohibit any practice, undertaking or ag reement that has as its objective or effect the 
prevention, restriction or distortion of competition within the Community.  This provision, however, 
does not apply to a practice, undertaking or agreement that improves the production or distribution of goods, or promotes consumer welfare or technical or economic development. 
28. An EAC Competition Bill is under consideration by the East African Legislative Assembly 
(as at July 2006).  The Bill prohibits anti-competiti ve practices, including price collusion, collusive 
tendering and market allocation, and quantitative restra ints on investment or sales.  It establishes an 
EAC Competition Committee, composed of one repr esentative from each member state, which has the 
power to investigate and to compel evidence, hold hearings, and to impose san ctions and remedies.  
The Bill also contains provisions on mergers and acquisitions, consumer we lfare (including unfair 
competition), and subsidies. 
  
 EAC WT/TPR/S/171/Rev.1 
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European Commission (2005), Information Note on the Revision of the Cotonou Agreement .  
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Imani Development (Malawi) Ltd. (2001), Draftin g Briefing Paper on Regional Trade Agreements, 
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IMF (2005), Trade Integration in the East African Community: An Assessment for Kenya .  Available 
at:  http://www.imf.org/extern al/pubs/ft/wp/2005/wp05143.pdf. 
WTO (2003), Trade Policy Review:  Southern African Customs Union , Geneva. 
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