RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/TON/12 
21 March 2005 
 (05-1181) 
Working Party on the  
Accession of Tonga Original:   English 
 
 
 
ACCESSION OF THE KINGDOM OF TONGA 
 
Additional Questions and Replies  
 
 The following submission, dated 14 March 2005, is being circulated at the request of the 
Delegation of the Kingdom of Tonga. 
_______________ WT/ACC/TON/12 
 Page i 
 
 
 TABLE OF CONTENTS 
II. ECONOMIC POLICIES..........................................................................................................1  
- Monetary and Fiscal Policy..................................................................................................... .1 
- Foreign Exchange and Payments ............................................................................................2  
- Investment Regime.............................................................................................................. ......3  
- State Ownership and Privatization .........................................................................................5  
- Pricing Policies ............................................................................................................... ...........6  
III. FRAMEWORK FOR MAKING AN D ENFORCING POLICIES ......................................7  
IV. POLICIES AFFECTING TRADE IN GOODS ...................................................................10  
- Trading Rights ................................................................................................................. .......10  
A. IMPORT REGULATIONS....................................................................................................11  
- Ordinary duties and charges..................................................................................................11  
- Tariff quotas, tariff exemptions.............................................................................................12  
- Other duties and charges....................................................................................................... .12 
- Application of internal taxes to imports ...............................................................................13  
- Quantitative import restrictions, includi ng prohibitions, quotas and licensing 
systems ........................................................................................................................ .............13  
- Customs valuation.............................................................................................................. .....16  
- Rules of origin ................................................................................................................ .........18  
B.  EXPORT REGULATIONS ..................................................................................................18  
- Customs tariffs, fees and charges for serv ices rendered, application of internal 
taxes to exports............................................................................................................... .........18  
- Export subsidies ............................................................................................................... .......19  
C. INTERNAL POLICIES A FFECTING FOREIGN TRADE IN GOODS .........................19  
- Technical barriers to trade .................................................................................................... 19 
- Agricultural policies.......................................................................................................... ......19  
- Trade in ci vil aircraft........................................................................................................ ......20  
V. TRADE-RELATED INTELLECTUAL  PROPERTY REGIME.......................................20  
VII. TRANSPARENCY .................................................................................................................24  
- Publication of information on trade......................................................................................24  
ANNEX 1 ........................................................................................................................ ......................26  
ANNEX 2 ........................................................................................................................ ......................28   WT/ACC/TON/12 
 Page 1 
 
 
 II. ECONOMIC POLICIES 
- Monetary and Fiscal Policy Question 1 Please indicate whether the list of taxes given is exhaustive. 
Answer:
 
As the WTO members are aware, Tonga is in the process of implementing a series of taxation 
reforms.  The key elements of the "new" taxation system are: 
- A broad based consumption tax kn own as the Consumption Tax (CT); 
- A simplified individual income tax and single rate corporate income tax; - A single rate customs duty and excise duty on imports and local production of alcohol and 
tobacco products. 
Due to the uncertainty of the impact of the taxa tion reforms of government revenue, the Government 
of Tonga has decided to take a cautious appro ach regarding the implementation of the taxation 
reforms.  Rather than introducing the taxation refo rms in a "big bang" the reforms will be introduced 
gradually. 
- Consumption Tax 
The first stage of the reforms will be the introduc tion of a broad based consumption tax known as the 
Consumption Tax (CT).  The CT - which will be at  a rate of 15 per cent - will replace three narrow 
taxes - the sales tax (5 per cent), the fuel sales tax and the ports and services tax (20 per cent); the 
operation of these three taxes will ceas e when the CT comes into effect.  The CT will come into force 
and the sales tax, fuel sales tax and ports and services tax will cease on 1 April 2005. 
Introducing the CT before the other taxation reform s occur will enable the Government of Tonga to 
observe the revenue generating perform ance of the CT prior to the introduction of other reforms.  This 
will ensure that the economy is not put into a precarious position by the reforms. 
- Income Taxes The draft Income Tax Bill will be submitted to Parlia ment in the 2005.  It is anticipated that the 
income tax reforms will be implemented by 1 December 2005.  
- Customs and Excise Duties The single rate customs duty and excise ta xes will be implemented after PC Trade
1 is introduced to 
Tonga Customs.  All rates of duty in the HS Code are currently being examined and analysed.  The Customs database needs to be upgraded to be  consistent with the HS 6-digit system. 
                                                     
 
1 Personal Computer (PC) Trade is a database developed by Statistics NZ using Microsoft Access 
software.  PC Trade will be used to proce ss Customs data and collect trade statistics. WT/ACC/TON/12 
Page 2  
 
 PC Trade is due to be implemented in Tonga Cust oms by December 2005.  At this time, tariffs on 
alcohol and tobacco products will be changed from ad valorem  to fixed tariffs and all other tariffs will 
be reduced to 35 per cent or below. 
It is intended that the reduction to a single rate duty,  which has tentatively been set at 15 per cent, will 
occur in gradual steps.  It is an ticipated that the first reduction to a single rate of 25 per cent will occur 
by 1 July 2006 and the second reduction to a single ra te of 15 per cent will occur by 1 January 2007 at 
the latest. 
Tonga is aware that WTO members were anticipati ng changes to our customs and excise duties at an 
earlier date.  However, we require more time for preparation for these reforms in order to ensure 
successful implementation. 
- Foreign Exchange and Payments Question 2 Paragraphs 12 and 13: We would appreciate a brief description of the "repatriation 
requirement" for the report (e.g. is the requi rement focused on overseas financial assets of 
Tongans or on foreign exchange earning, or both ; if overseas financial assets, what kinds; what 
law provides the government with the authority to require such repatriation; over what period 
of time should repatriation occur; and how does it become known that such repatriation is no longer necessary, i.e., how is the measure terminated or suspended once the crisis that sparked invocation of the repatriation requirement had passed)? 
If Tonga intends to retain authority to in voke such requirements, we seek information 
assurances from Tonga as to the condi tions that would justify its use. 
Answer:
 
The repatriation requirement is focused on assets in Tonga. The Foreign Exchange Control Act No. 9 1963, Foreign Exchange Control Regulations 1965 and 
Foreign Exchange Control Regulations (Amendme nt) Act 2000 gives the National Reserve Bank of 
Tonga (NRBT) the powers to impose repatriation requirements. 
Tonga would like to stress that it is a member of the International Monetary Fund (IMF) and as such: 
(a) all current payments are free; and 
(b) any capital introduced into the country is free to be repatriate d provided documentary 
evidence is submitted to the NRBT for verification. 
In addition, the NRBT from time to time puts guide lines in place to be follo wed by foreign exchange 
dealers (including banks) prior to allowing these re mittances.  This is necessary to assist the NRBT 
with the management of foreign reserves and the calculation of the balance of payments and to 
enhance Tonga’s anti-money laundering and anti-terrorist financing regime. 
Therefore, the following foreign exchange repa triation requirements are currently in place: 
1.  Prior approval from the NRBT is required for the following: 
(a) All outward transfers of T$50,000 and above. 
(b) All capital transfers irrespective of the amount.  Capital transfers include: 
 - Transfers for purchase of property, migrants transfers and debt forgiveness;  WT/ACC/TON/12 
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  - Acquisition / disposal of non-financial assets such as patents; 
 - Direct investment, including equity capital;  - Portfolio investment, including equity a nd debt securities and financial derivatives; 
 - Other investments, including trade credits, loans and bank deposits (c) All loans in excess of T$50,000 to any corpor ate body resident in Tonga which is, by any 
means, controlled by persons resident outside of Tonga. 
2.  The following repatriation requirements have been delegated to commercial banks: 
(a) All outward transfers of less than T$50,000; (b) All outward transfers from foreign currenc y accounts (commercial banks are required to 
notify the NRBT no later than one business da y after the transfer has been effected). 
The NRBT has no set limit on when repatriation should occur. 
Prior to 5 July 2000, there were no formal repa triation requirements in place.  The repatriation 
requirements were put in place because the offici al foreign reserves level of Tonga fell below 
3 months of import cover starting in May 2000 and the outlook was that foreign reserves would 
continue to decline.  The foreign reserves le vel was as low as 1.7 months of import cover in 
May 2002.  The comfortable level of import cover is regarded as 3 to 4 months of cover.  As Tonga is 
a very small economy highly dependent on imports , it is important that foreign reserves are 
maintained at a comfortable level in order to pr otect the country in case of sudden shocks to the 
economy such as from a natural disaster (e.g. cyclon es).  For these reasons, the NRBT has to closely 
monitor the level of foreign reserves and has therefore imposed repatriation requirements. 
Tonga would like to reiterate that the NRBT’s pr ior approval requirement for transfers of $T50,000 
and above is only for information gathering purposes.  All current payments are allowed to be made.  
Capital transfers are minimal in both number and size. 
The NRBT would prefer to eliminate repatriati on requirements and would consider removing the 
repatriation requirements once it is comfortable that  the country’s foreign reserves level would be 
maintained at the minimum of 3 to 4 months import cover in the long term. 
Question 3 Once we clarify the nature and conditions of use of  the requirement, we are prepared to propose 
commitment language to finalize this section. 
Answer:
 
Tonga is prepared to consider any co mmitment language proposed by members. 
- Investment Regime 
Question 4 
Paragraph 21: Tonga is invited to provide an update on the drafting of the regulations 
specifying the conditions for foreign investment in restricted activities, as well as clarification on 
the meanings of "reserved" and "restricted" and on whether regulations are also being drafted 
on conditions for foreign investment in reserved activities. WT/ACC/TON/12 
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 Answer:
 
The draft Foreign Investment Regulations, provide definitions of "reserved" and "restricted".  The 
final draft of the Foreign Investment Re gulations is provided through the document 
WT/ACC/TON/12/Add.1.  The relevant sections are: 
For section (4)1 of the Act, the Reserved List is set out in Schedule 1 and prescribes 
business activities which only Tonga n investors may carry on. 
For section (4)2 of the Act, the Restricted List is set out in Schedule 2 and prescribes the 
business activities which a foreign inv estment business may carry on if the 
corresponding conditions set out in that Schedule are satisfied. 
By definition, foreign investors may not carry  on "reserved" business activities.  Therefore no 
regulations are being drafted on conditions for foreign investment in reserved activities.  
The final draft of the Foreign Investment Regula tion has been submitted to Crown Law for review 
before being submitted to the cabinet for approval.  It is anticipated that the Regulation will be 
implemented by December 2005. 
Question 5 
In Schedule 3 of the Foreign Investment Re gulations (available through the document 
WT/ACC/TON/12/Add.1 ), No. 3 on the prohibited list is "Export, import or production of any 
products that are prohibited under the Laws of Tonga".  This seems a very broad definition, 
and we would be grateful for examples of prohibited products. 
Answer:  
Schedule II Part I of the Customs and Excise Act (C AP.67) lists prohibited imports that include, for 
example: 
- Base or counterfeit or imitation currency or bank notes or fictitious posta ge or revenue stamps 
of any other country and any die, plate instrument or materials capable of making any such coin, currency or bank notes or an y such revenue or postage stamps; 
- Goods bearing the Royal Arms of the Kingdom of  Tonga or arms so closely resembling such 
arms as to be calculated to deceive unless the importer of such goods holds His Majesty’s 
authority to use them in connection with  his trade, business, calling or profession; 
- All fireworks other than distress, light or sound signals and rockets and other pyrotechnics 
forming part of the safety equipment or stores of  a vessel or aircraft or designed and intended 
to be used as part of such equipment or stores; 
- All books and any written or printed matter a nd sounds and visual recordings which the 
Controller shall by notice declare to be prohibited imports on account of any copyright laws 
which apply in the Kingdom; 
- All books and any written or printed matter a nd sounds and visual recordings which the 
Controller shall declare to be seditious or wh ich advocate violence, lawlessness or disorder. 
Schedule II Part II of the Customs & Excise Act (CAP .67) lists prohibited exports which include, for 
example: 
- Articles of Tonga Culture which are specifically  listed such as Tao-Fotoi (barbed spear), Kolo 
(throwing Club) and Paletau (shield);  WT/ACC/TON/12 
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 - Raw coral (including unprocessed black cora l) except with the written permission of the 
Controller of Customs following approval by Cabinet.  
Question 6 
We understand from the revised text of the dra ft Working Party report that Tonga intends to 
repeal the 1978 Industrial Development Incentives (IDI) Act.  The response to Question 22 
states that the IDI will be repealed "once the Tax Reform is in place…".  Is this correct?  Please 
clarify precisely when, and how, Tonga will repeal the IDI. 
Answer:  
The main incentives that the IDI Act provides to development licence holders are exemptions from 
customs duties and the ports and services tax. 
The IDI Act will be suspended on 1 July 2006 and subsequently repealed once customs duties have 
been reduced to the single rate of 15 per cent. 
However, it should also be noted that the provisions  of the IDI Act that exempt development licence 
holders from the ports and services tax will cease to have effect when the ports and services tax is 
eliminated on 1 April 2005 by the Port and Services (Repeal) Act 2003. 
Question 7 Will the benefits granted to investors be continue d, or will they be eliminated when the IDI is 
repealed? 
Answer:
 
Repealing the IDI Act will eliminate the bene fits granted to investors under this Act. 
- State Ownership and Privatization 
Question 8 
Could Tonga state (listing any exception) that none of its state holdings receive any special 
benefits or monopoly authority from the govern ment and that the establishment of competing 
firms would be welcome?  A statement along those lines is contained in paragraph 128.  It would 
be useful to have that information in this section as well. 
Answer:  
There are no special benefits given to Public Ente rprises and the establishment of competing firms is 
welcome. 
Question 9 
Can Tonga estimate the percentage of its GDP that is generated by state owned firms? WT/ACC/TON/12 
Page 6  
 
 Answer:
 
Tonga’s GDP figures are not disaggregated into GDP generated by state owned and non-state owned 
firms hence it is not possible to provide a reliable est imate of the percentage of GDP that is generated 
by state owned firms. 
The Public Enterprise Division of the Ministry of Finance has balance sheet values of assets of T$186 
million and net government investment (including loans) of $T107 million.  These figures are as of 
March 2004. 
- Pricing Policies 
Question 10 Paragraphs 30 and 31: We seek an inclusion in the text of a date certain for the enactment and 
implementation of amendments to the Price a nd Wage Control Act of 1988 to remove reference 
to local agricultural and fish products not s ubject to price control from Mark-Up Schedule. 
Answer:
 
A submission will be made to the Competent Authority to issue an order to remove reference to local 
agricultural and fish products not subject to pri ce control from the Mark-Up Schedule by 1 June 2005. 
Question 11 Per the response to question 13, what is the Tonga Competent Authority? 
Answer:
 
This is the body created and empowered by the Pr ice and Wage Control Act to carry out the powers 
and functions conferred by the Act.  The primary fu nction of this body is to regulate and monitor the 
prices of "controlled goods and services" traded in  Tonga.  This body is also responsible for setting 
and monitoring the operation of the minimum wage ra te, however this power has not been exercised 
to date as there is currently no minimum wage rate.   
Question 12 
Will the amendments be enacted a nd implemented prior to accession? 
Answer:  
Please refer to the Answer to Question 10 above.  The amendments will be implemented prior to 
accession. 
Question 13 
Paragraphs 31-32: We seek further information on the draft amendments to the Price and 
Wage Control Act 1988.  WT/ACC/TON/12 
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 Answer:  
Please refer to the Answer to Question 10 above. 
III. FRAMEWORK FOR MAKING AND ENFORCING POLICIES  
Question 14 More information is sought on the status of WTO in Tonga's legal framework.  After approval 
by the Privy Council, do the provisions of th e WTO Agreement and Tonga's accession package 
supersede current domestic law? Would WTO provi sions be considered to override conflicting 
domestic regulation or law? 
Answer:
 
In order for ratification to occur, the Minister who officially oversees WTO Issues (Hon. Minister for 
Labour, Commerce and Industries) shall submit the accession package to the Privy Council.  
Ratification of the accession package requires approval by the Privy Council. 
Once the Privy Council grants approval of th e WTO Agreement and To nga’s accession package, 
WTO provisions do not supersede current domestic le gislation: the approval is only at the policy 
level.  Where there is conflict between WTO provisions and those of  domestic law and regulations, 
domestic law and regulations override  those of the WTO Agreement. 
In order for the WTO Agreements and the accession package to come into force they must be 
"incorporated" into the domestic legisl ation by amending domestic legislation. 
Question 15 
Paragraph 38: We appreciate the clarification of  the right of appeal in paragraph 38.  Please 
clarify or confirm the following: 
That there are two paths for administrative appeal. 
The first is provided under Section 10(1) of the Co urt of Appeal Act, where an appeal could be 
lodged to the court of appeal from all administ rative final orders, judgements, and decisions of 
the Government (excluding criminal matters). 
The second is the right of appeal of any admini strative action relating to matters subject to 
WTO provisions, e.g. customs classification and valuation, tariff application, licensing, TBT, 
SPS and TRIPS to the Commissioner for Public Complaints. 
Answer:  
These are the paths for administrative appeal: 1. Pursuant to section 4 of the Supreme Court Act [CAP10], the Supreme Court has jurisdiction 
to hear administrative review cases in the fi rst instance.  Applications for administrative 
review are lodged with the Supreme Court pursuant to the Supreme Court Rules. 
2. Pursuant to section 10 of the Court of Appeal  Act [CAP 9] a decision of the Supreme Court in 
respect of an administrative review case can be appealed to the Court of Appeal. WT/ACC/TON/12 
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 3. In accordance with the Commissioner for Pub lic Relations Act 2001, a complaint against a 
decision, recommendation or any act done by a government civil servant may be lodged with the Commissioner for Public Complaints for investigation.  
Question 16 
Paragraph 38:  What is unclear from the descri ption is the role of the Supreme Court of the 
land courts "sitting in the first instance" and wh at sort of permission is necessary to make the 
appeal. 
Answer:
 
The phrase "sitting in the first instance" refers to wh en the case is first tried or heard in the Supreme 
Court or Land Court. 
The following must be satisfied to permit an appeal: 
- Obtain the leave of the judge at first instance; 
- The appeal is made within 42 days from the date of the judgment; - The grounds for appeal are clearly laid out. 
Question 17 
The nature of conditions on the right of appeal is also unclear, i.e., that (i) the sum awarded did 
not exceed TOP 1,000; (ii) the order had been made  by consent; or (iii) the order was an order 
as to costs; and all interlocutory orders, judgme nts, and decisions were made by leave of the 
first instance court of appeal. 
Answer:
 
The general conditions that must be satisfied to permit an appeal are outlined in the answer to 
Question 16 above. 
The matters (i-iii) outlined above are not conditions of  appeal.  They refer to matters that maybe the 
subject of an appeal.   
Question 18 
How is the Court of Appeal structured?  Is appeal from the Court of Appeal possible, e.g., to the 
Supreme Court? 
Answer:  
The court of appeal consists of 3 judges, which incl udes the Chief Justice.  This means that at least 
3 judges must be present at a Court of Appeal sittin g.  An appeal against a decision of the Court of 
Appeal maybe made to Privy Council.  However, it should be noted that the Court of Appeal Court is 
the highest Court in Tonga in relation to all criminal and civil cases; only cases pertaining to titles 
(i.e. nobles titles) and hereditary estates can be appealed to the Privy Council. 
Question 19 
Paragraph 38 should be clarified to give a simple indication of the hierarchy of appeal of the 
Government’s administrative rulings to these courts.  WT/ACC/TON/12 
 Page 9 
 
 
 Answer:  
The case maybe first heard at the Supreme Court.  The decision of the Supreme Court maybe 
appealed to the Court of Appeal.  The decision of  the Court of Appeal maybe appealed to Privy 
Council.  However, it should be noted that the Court of Appeal Court is the highest Court in Tonga in 
relation to all criminal and civil cases; only cases pertaining to titles (i.e. nobles titles) and hereditary 
estates can be appealed to the Privy Council. 
Question 20 
Please give the legal basis for the Office of the Commissioner. 
Answer:  
The legal basis for the Office of the Commissioner of  Public Relations is the Commissioner for Public 
Relations Act 2001. 
Question 21 
Who appoints the Commissioner? 
Answer:  
His Majesty in Council appoints the Commissioner for Public Relations. Question 22 Is the office part of the judiciary or part of the executive? 
Answer:
 
The office of the Commissioner is quasi-judicial in  the sense that its enforcement powers are limited 
to recommendations.  
Question 23 
How long does the Commissioner serve?  Answer:
 
The Commissioner serves for a term of 5 years. 
Question 24 
How can the Commissioner serve as a tribunal? 
Answer:  
- The Commissioner receives the complaints and carries out investigation on the complaints 
within the scope of his jurisdiction;  
- At the completion of the investigation, the Commissioner makes the necessary 
recommendations to the relevant governme nt department or organization;  WT/ACC/TON/12 
Page 10  
 
 - Where no action has been carried out on the recommendation within a reasonable time, the 
Commissioner may send a copy of the recommendations to the Prime Minister who shall table it in Privy Council.  
Question 25 
Please confirm and describe how it is independent  of the executive and other state authorities 
from whose ruling it receives appeals. 
Answer:
 
The Commissioner operates independently of the ex ecutive in the sense that the office is not 
appointed by the executive.  Further the Commissione r is not under or Answerable to the executive. 
Question 26 
Have any cases been appealed as yet? Answer:
 
No cases have been appealed to date. 
Question 27 
Paragraph 42:  We note that all laws must be passed by the National Assembly (NA), and that 
the WTO, as an international agreement would sup ersede domestic legislation.  Please clarify if 
ratification of the WTO package will require approval by the NA.  
Answer:  
Ratification of the accession package requires approval  by the Privy Council.  Ratification does not 
require approval by Parliament. 
Once the Privy Council grants approval of th e WTO Agreement and To nga’s accession package, 
WTO provisions do not supersede current domestic le gislation: the approval is only at the policy 
level.  Where there is conflict between WTO provisions and those of  domestic law and regulations, 
domestic law and regulations override  those of the WTO Agreement. 
In order for the WTO Agreements and the accession package to come into force they must be 
"incorporated" into the domestic legislation by am ending domestic legislation.  Of course, domestic 
legislation must be passed by Parliament. 
IV. POLICIES AFFECTING TRADE IN GOODS 
- Trading Rights Question 28 Paragraphs 45-46:  Please confirm in the text that a foreign firm seeking to be the importer of 
record for imports to Tonga would have to have a foreign investment license in order to register 
to import into Tonga.  (Please note that this does not include distribution of the imports, only 
the status of the importer of record.)  WT/ACC/TON/12 
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 Answer:  
When the new Foreign Investment Act is enforced, a foreign firm who wishes to be an importer of 
any goods to Tonga must obtain a Foreign Investment License prior to obtaining the Import License from the One Stop Shop, Customs Department. 
Question 29 
Paragraphs 45-46: Please provide an update on  the status of implementation of the new 
Business Licenses Act and its implementing regul ations.  Is the December 2004 date still viable? 
Answer:
 
The adoption of the Business Licence Act 2002 is pe nding until its Regulations are approved.  The 
draft Business Licence Regulations has been direct ed to the Crown Law Department for review prior 
to being forwarded to the Cabinet for approval.  It is anticipated that these Regulations will be 
implemented by December 2005. 
A. IMPORT REGULATIONS 
- Ordinary duties and charges Question 30 
Tonga is requested to include in this section the level of applied tariffs and the legal citation of 
the law that implements the tariff. 
Answer:
 
The single rate customs duty will be implemented af ter PC Trade is introduced to Tonga Customs.  
All rates of duty in the HS Code are currently be ing examined and analysed.  The Customs database 
needs to be upgraded to be consistent with the HS 6-digit system. 
PC Trade is due to be implemented in Tonga Cust oms by December 2005.  At this time, tariffs on 
alcohol and tobacco products will be changed from ad valorem  to fixed tariffs and all other tariffs will 
be reduced to 35 per cent or below. 
It is intended that the reduction to a single rate duty,  which has tentatively been set at 15 per cent, will 
occur in gradual steps.  It is an ticipated that the first reduction to a single rate of 25 per cent will occur 
by 1 July 2006 and the second reduction to a single rate of 15 per cent will occur by 1 January 2007 at 
the latest. 
Tonga is aware that WTO members were anticipati ng changes to our customs and excise duties at an 
earlier date.  However, we require more time for preparation for these reforms in order to ensure 
successful implementation. 
Tonga’s tariff schedule (Schedule I) is an Amendmen t to the Customs & Excise Act (CAP.67).  The 
tariff schedule will be changed by amendment to the Customs and Excise Act. 
Question 31 
Paragraph 50: Could Tonga please confirm wheth er a decision was taken on a single rate 
customs tariff at the end of October 2004. WT/ACC/TON/12 
Page 12  
 
 Answer:
 
Please refer to the answer to Question 30 above. 
Question 32 
Please indicate how and when Tonga will adopt the HS system.  Will Tonga’s WTO GATT 
schedule be established in HS? 
Answer:  
Tonga is currently using the 4 digits Harmonised C oding System (HCS).  Tonga is currently preparing 
for the implementation of the PC Trade system and the 6 digits HCS will be used in the database.  It is 
anticipated that the PC Trade system will be implemented by December 2005. 
PC Trade is a database developed by Statistics NZ using Microsoft Access software and will be used 
to process Customs data and collect trade statistics. 
Question 33 
Paragraphs 49-50:  This section may require revision  in light of developments.  The level of the 
applied tariffs should be updated or the cur rent levels related to the current law that 
implements them.  Please update paragraph 50. 
Answer:  
Please refer to the answer to Question 30 above. 
- Tariff quotas, tariff exemptions 
Question 34 Paragraph 55:  Tonga states that tariff exempt ions granted under the IDI will cease to have 
effect upon the introduction of Tonga’s taxat ion reforms.  Will these benefits be legally 
repealed?  If so, we would like to record it. 
Answer:
 
The IDI Act will be suspended on 1 July 2006 and subsequently repealed once customs duties have 
been reduced to the single rate of 15 per cent.  Rep ealing the IDI will eliminate the benefits granted to 
investors under this Act. 
- Other duties and charges Question 35 Paragraph 63:  The commitment should be for "all fees and charges, including those listed in 
paragraphs [45], [59] and [95] of this Report". 
Answer:
 
Tonga stresses that the commitment should not be fo r "all fees and charges, including those listed in 
paragraphs [45], [59] and [95] of this Report".  WT/ACC/TON/12 
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The fees referred to in paragraph 59 - berthage, wh arfage, mooring, slipway and boat lifter and tug 
boat - are commercial charges; these fees are not ODCs.  Please refer to paragraph 60 and our answer in document WT/ACC/TON/11 for details on these fees. 
- Application of internal taxes to imports 
Question 36 
Paragraph 68: Please make it clear that TC T will be applied equally to imported and 
domestically produced goods.  The current statemen t, that it will be applied to imports of goods 
and services” gives a different impression. 
Answer:
 
The Consumption Tax (CT) will be levied on all imports and most goods a nd services.  The CT will 
be applied equally to imported and domestically produced goods. 
Question 37 
The application of the excise tax to domestic output would be at "the point of sale".  Is this ex 
factory, wholesale or retail? 
Answer:  
The application of the excise tax is ex-factory. 
- Quantitative import restrictions, including prohibitions, quotas and licensing systems  
Question 38 Table 5(b): Does import prohibition No. 6 "All b ooks and any written or printed matter, sounds 
and visual recordings of which import is prohib ited by copyright law" refer to counterfeit goods 
or copyright piracy? 
Answer:
 
Import Prohibition No. 6 under Table 5(b) refers to both counterfeit goods and copyright piracy.  
The infringement of rights of owners of copyright is termed "Piracy".  Infringement of rights of owners of trademarks, pa tents, industrial designs, geographical indications, 
etc, is termed "Counterfeit".  
Section 6(1)(f) of the Copyrights Act 2002 proh ibits anyone from importing copies of copyright 
works without permission of the rightful owners. Section 15 has, however, allowed importation of 
copyright works for personal use.  
Section 43 of the Industrial Property Act 1994, prevents anyone from infringing the rights of the 
owner of the title of protection. WT/ACC/TON/12 
Page 14  
 
 An Enforcement and Border Measure s Bill has been drafted with the aim of enforcing the provisions 
of the Industrial Property Act, particularly t hose regarding the importation and distribution of 
protected goods and copyrighted works in Tonga. 
Question 39 
Paragraph 73 and Table 5(b): What criteria are u sed by the Ministries of Finance and Police to 
judge the soundness of imported automobiles?  Who does the evaluation?  What recourse does 
an importer have if the automobile  is rejected for safety reasons? 
Answer:
 
The criteria for soundness of automobiles imported for commercial purposes is that they must be 
manufactured in the last 10 years.  There is no restriction on the age of the vehicles imported 
privately.  Evaluation of soundness is done by a Cu stoms officer at the wharf.  An importer must 
comply with safety requirements for the automobile to be released. 
The Customs and Excise Act (Cap 67) Section 35 and Schedule II, Part I, Section 5 under the List of 
Restricted Imports provides the list of motor vehicles whose importation into Tonga is restricted.  This restriction can be waived when there has been a licence issued by the Minister of Finance.  In 
relation to left hand drive vehicles, the restriction can be waived when there has been a licence issued 
by the Minister of Finance and the Minister of Police.        
Question 40 
Paragraph 74: Tonga is invited to provide the legislation that will repeal Tonga's restrictions on 
imports of eggs, alcoholic beverages, and cabin and ship's biscuits. 
Answer:
 
Restrictions on imports of eggs, brandy, whisky, ru m and cabin and ship’s biscuits will be removed by 
amendments to the Customs & Excise Act. 
Question 41 
Paragraphs 75-78:  We need specific information on  the legislation that has changed the system.  
Is it is force yet?  If not, when could we expect to have it in force?  Can we have a copy of the 
legislation? 
Answer:  
The implementation of the new Business Licen ce Act 2002 is pending until its Regulations are 
approved.  The draft Regulations have been directed  to the Crown Law Department for review prior to 
being submitted to the Cabinet for approval.  It is anticipated th at the Business Licence Regulations 
2002 will be implemented by December 2005. 
The final draft of the Business Licence Regula tions 2002 is provided through the document 
WT/ACC/TON/12/Add.1.   
Question 42 
Paragraphs 75-78:  We would like to be able to  determine if the new system can be considered 
"automatic" under the terms of the WTO Import  Licensing Procedures Agreement, e.g., how  WT/ACC/TON/12 
 Page 15 
 
 
 long before customs clearance must a license be ob tained; is approval granted in all cases if the 
legal requirements for importation are fulfilled, and are the licenses granted within a maximum 
of 10 working days? 
Answer:  
Under the new Business Licence Act 2002 any busi ness person carrying out a business activity must 
hold a valid business licence for that business activity.   In order for a business person to import into 
Tonga, they must hold a business licence for importing; "Importing" is section 3 (c) (ii) under Schedule 3 (which categorises business activities) of  the draft Business Licence Regulations 2002. 
The new Act requires a licence to be issued au tomatically to any business person planning to 
undertake any business activity in Tonga provided that the legal requirements are fulfilled.  Pursuant 
to Section 5 of the Business Licence Act 2002, a bu siness licence should not be granted to (a) to a 
person carrying on a prohibited activity; (b) to an indi vidual under 18 years of age; (c) to a partnership 
where any one of the partners is under 18 years of age; or (d) to a foreign investor who does not hold a valid foreign investment registered certificate. 
Pursuant to Section 5 (1) of the draft Busi ness Licence Regulations 2002, where a complete 
application is received, the Business Licensing Office r shall within 7 days either issue the applicant 
with a Business Licence or advise the applicant in writing of the grounds for refusing the application. 
Licence fees are based wholly on the cost of services rendered (i.e. verification and processing of 
applications) and will be levied annually.  Once a licence has been issued , the business/person can 
engage in the business activity (such as im porting) without restriction for a year. 
Question 43 
One Member is asking Tonga to provide respo nses to the Import Licensing Procedures 
Questionnaire based on its new system. 
Answer:
 
Under the new system, importers must obtain a bu siness licence for importing.  Please see the answer 
to Question 42 and the "Business Licence Regulations  2002", that is available through the document 
WT/ACC/TON/12/Add.1, for details about the Business Licence system.  As there will be no specific 
import licences under the new system the Import Licens ing Procedures Questionnaire is not relevant.  
Question 44 
Paragraphs 75-78: Tonga should include a clear statement of what the new fees are, and how 
they relate to services rendered.  Table 6 should  be supplemented with the new information on 
the revised fee structure. 
Answer:  
The new fees as set out in Schedule Two of th e new draft Business Licence Regulations 2002, are 
based wholly on the cost of services rendered (i.e . verification and processing of applications). 
The Business Licence Regulations 20 02 are available through the document 
WT/ACC/TON/12/Add.1. WT/ACC/TON/12 
Page 16  
 
 Question 45 
Paragraph 78: Please include the information that  the practice of licensing each imported 
consignment has been abolished with the Licensing Act, and that the fees in Table 6 will not be 
applied.  Will all of this be implemented in January 2005? 
Answer:
 
Pursuant to Section 24 of the Business Licenc es Act 2002, the Licence Act (Cap. 47) will be 
automatically repealed when the Busi ness Licences Act 2002 comes into effect. 
Under the new Business Licences Act 2002, once a licence has been issued, the business/person can 
engage in the business activity (such as im porting) without restriction for a year. 
- Customs valuation 
Question 46 
Tonga should provide a copy of the Customs Bill of 2003 and explain what additional provisions 
(i.e., beyond the 2003 Customs Bill) related to cust oms valuation are to be included in the new 
legislation.   
Answer:  
A copy of the Customs & Excise Amendment Act 2003 is available through the document 
WT/ACC/TON/12/Add.1. 
The Customs & Excise Amendment Act 2003 was dr afted with the aim of implementing the WTO 
Valuation provisions in Tonga. Those provisions we re passed by the Parliament in October 2003 and 
commenced operation on 3 May 2004. However, the Ac t as drafted, does not fully or appropriately 
implement the WTO system and requires amendment for a number of reasons, broadly categorized as 
follows: 
1. There is no authority for exclusion of genuine interest charges; 
2. Important definitions are omitted e.g.  "goods for the same class or kind"; 
3. Inappropriate wording is used e.g. "be decr eased by", in 44E(3) instead of the Agreement’s 
"not include" (thereby making the deduction mandatory); 
4. Incorrect tests are applied e.g. 180 days in lieu of 90 in 44H(b) (4); and 
5. In general, there are departures from the langua ge of the Agreement with potential changes in 
meaning in some cases e.g. the use of the word ‘provided’ in lieu of ‘undertaken’ in 44E (3) 
(a), and confusion in others. 
For these reasons, amendments to the Customs & Excise Amendment Act 2003 which include the 
Valuation provisions implemented on the 3 May 2004 have been requested.  It is anticipated that these 
new amendments will be dealt with by the new Cu stoms & Excise Bill 2004. The draft of the Bill has 
been received from the IMF’s PFTAC o ffice (who assisted in the drafting of this Bill) and is available 
through the document WT/ACC/TON/12/Add.1 
Question 47 
Paragraph 82: Tonga is invited to provide more specific information on the reasons why it is 
seeking a transitional period to implement this agreement.  What specifically is lacking under 
the 2003 Customs Act?  WT/ACC/TON/12 
 Page 17 
 
 
 Answer:  
The Customs department is not currently fully equipp ed with the appropriate facilities, e.g. databases 
etc, to implement this Agreement.  Technical trai ning for Customs Official must also be undertaken 
prior to its implementation.  In addition, the business sector and genera l public need to be made aware 
of the implications of this Agreem ent prior to its implementation.   
Question 48 Paragraph 84: Paragraph 84 says th at the new legislation will be enacted "passed by Parliament 
by the end of 2003" while paragraph 82 states th at "an entirely new Customs Act incorporating 
all the requirements of the WTO Customs Valu ation Agreement was being drafted, to be 
submitted to Parliament in June 2004."  This would appear inconsistent.  Are the amendments 
referred to part of the 2003 Customs Act or the new Customs Code? 
Answer:
 
Please refer to Answer to Question 46 above. 
Question 49 
Paragraphs 83-84: Tonga should include a specific reference to the part of the Agreement where 
Tonga seeks a transition must be included in the commitment, e.g. at the end of paragraph 83. 
Answer:  
Aside from the legislative amendments, as detailed in  the Answer to question 46, the implementation 
of the new WTO Customs Valuation Agreement is causing major operational problems.  The 
complexity of the new procedure will delay its  acceptance by Customs and the business community 
hence a transition period is required.  In a ddition, Article 16 of the Agreement places new 
responsibilities on Customs Officials to provide wr itten advice and binding ruli ngs to importers and 
brokers, which will be subject to legal interpreta tion and appeal.  Tonga requires time to develop 
guidelines for such responsibilities and therefore seeks a transition period for implementation. 
Question 50 
Paragraph 85:  The reference to "other aspects" in this paragraph is vague.  Tonga  should 
include, or refer to, an explicit statement on what parts of the Agreement subject to the 
transition and all other provisions apply in full from the date of accession. 
Answer:  
"Other aspects" would consist of such ancillary matters as binding rulings, confidentiality of data 
(Article 10), right of appeal (Article 11), publi cation of administrative material such as procedure 
manuals (Article 12), explanation of basis of cu stoms value (Article 16).  All these items need a 
proper legal framework before they can be taken furt her i.e. into procedural steps in a manual etc.  
The legal framework was to have arisen out of the Customs Bill 2004.  A final draft of the Bill has 
been received from the IMF’s PFTAC offices in Fiji.  However, substantial wo rk is still required to 
include other legislative requirements that have been identified as being necessary such as provisions 
for Ozone Depleting Substa nces and Excisable products. WT/ACC/TON/12 
Page 18  
 
 - Rules of origin 
Question 51 Paragraph 89: Tonga is invited to provide more sp ecificity on what it contemplates. Is this the 
new Customs Code? 
Answer:
 
Paragraph 89 refers to the new Custom & Excise B ill 2004. A draft of the Bill is available through the 
document WT/ACC/TON/12/Add.1. 
B.  EXPORT REGULATIONS 
- Customs tariffs, fees and charges for services rendered, application of internal taxes to 
exports 
Question 52 
Paragraph 95: It is clear that the "licensing fee" applied to exports is, in effect, an export duty, 
not a fee for service.  That makes the co mmitment in paragraph 98 inappropriate. 
Tonga should provide a schedule of its charges on the right to export, by HS number, indicating 
the total charge and confirming that the charge  exists only for trade in those items listed. 
The commitment should be redrafted to reflect th at neither Article VIII nor Article III of the 
GATT are relevant here. 
Answer:  
Tonga has incorporated all these commitments in its new Business Licence Regulations 2002 which 
has been submitted to Crown Law for review before be ing forwarded to the Cabinet for approval.  It is 
anticipated that the Regulations will be implemented by December 2005. 
Under the new Business Licence Act 2002 any busi ness person carrying out a business activity must 
hold a valid business licence for that business activity.   In order for a business person to export from 
Tonga, they must hold a business licence for exporting; "Exporting" is section 3 (c) (iii) under Schedule 3 (which categorises business activities) of  the draft Business Licence Regulations 2002. 
The new Act requires a licence to be issued au tomatically to any business person planning to 
undertake any business activity in Tonga provided that the legal requirements are fulfilled.  Pursuant 
to Section 5 of the Business Licence Act 2002, a bu siness licence should not be granted to (a) to a 
person carrying on a prohibited activity; (b) to an indi vidual under 18 years of age; (c) to a partnership 
where any one of the partners is under 18 years of age; or (d) to a foreign investor who does not hold a valid foreign investment registered certificate. 
Pursuant to Section 5 (1) of the draft Busi ness Licence Regulations 2002, where a complete 
application is received, the Business Licensing Office r shall within 7 days either issue the applicant 
with a Business Licence or advise the applicant in writing of the grounds for refusing the application. 
Licence fees are based wholly on the cost of services rendered (i.e. verification and processing of 
applications) and will be levied annually.  Once a licence has been issued , the business/person can 
engage in the business activity (such as e xporting) without restriction for a year.  WT/ACC/TON/12 
 Page 19 
 
 
 - Export subsidies 
Question 53 Paragraph 105:  Is the duty exemption referred to  in this paragraph linked to re-export of 
completed merchandise?  Is this a duty drawback scheme, or merely a duty exemption provision 
which applies regardless of whether the further manufactured article is re-exported or sold 
domestically?  If there is a requirement that the imports on which duty is exempted be re-
exported after further manufacturing, what sy stem is in place to monitor re-exports? 
Answer:
 
The link between duty exemption and re-export of completed merchandise is provided for in the 
Industrial Development Incentives Act 1978 (IDI Act 1978) (Part 3, section 12, subsection 4).  Raw 
materials, packaging materials and capital equipm ents imported for the processing, manufacturing, 
and assembling of an approved pr oduct” shall receive full exempt ion from customs duty and port and 
services tax "if the final finished product is or are re-exported".     
This is a duty drawback scheme as it requires the importer to pay the custom duty in full amount upon 
the arrival of the imported materials.  Refund howev er is made to the importer when the respective 
finished products are re-exported.  Sufficient evidence must be subm itted to the Controller of Customs 
at the time of the re-exportation as proof befo re the refunded amount is paid.      
As stated above, the IDI Act 1978 stipulates the re quirement to re-export the finished products.  
However, in practice, goods imported for re-export receives full exemption from Custom Duty at the 
initial port of clearance.  There is no system for the monitoring of the re-exported goods. 
Tonga stresses that the IDI Act will be suspende d on 1 July 2006 and subsequently repealed once 
customs duties have been reduced to the single rate  of 15 per cent.  Repealing the IDI will eliminate 
the benefits granted to investors under this Act. 
C. INTERNAL POLICIES AFFECTING FOREIGN TRADE IN GOODS 
- Technical barriers to trade Question 54 
We request further information on how Ton ga will fulfil obligations under the SPS Agreement. 
Answer:
 
Tonga has requested technical assistance from Australia regarding this issue. 
- Agricultural policies 
Question 55 The final sentence of paragraph 137 and the Explanatory Note 1(b) of document 
WT/ACC/SPEC/TON/4/Rev.2 state that the figures provided in the supporting tables include 
"external assistance provided through the government system". WT/ACC/TON/12 
Page 20  
 
 - Could Tonga please clarify whether the "external assistance provided through the 
government system" has been financed from sources other than the Tongan 
government? 
- If the Answer is in the affirmative, we ask Tonga to separately identify the Tongan 
government's own financial contributions to these measures and include only those 
financial contributions in its Supporting Tables. 
- If the Answer is in the affirmative, Tonga will accordingly need to amend both the final 
sentence of paragraph 137 and the final sentenc e of Explanatory Note 1(b) as follows: 
"The figures provided in the supporting tables did not [do not] reflect financial contributions to these measures made by the Government of Tonga". 
Answer:
 
Tonga confirms that the ‘external assistance provi ded through the government system’ in previous 
supporting tables has been financed from sources other than the Government of Tonga. 
Table 1 Annex 2 provides estimates of programs funded by the Government of Tonga excluding 
external sources of funding for the financial year 2000/2001. 
- Trade in civil aircraft Question 56 Tonga is invited to update this section.  What  charges would be placed on Aircraft and Aircraft 
parts under Tonga's new tax and tariff system.  What provision for exemptions from both 
tariffs and taxes are available?  E.g., will imports of civil aircraft be subject to the TCT or any 
other domestic taxes? 
Answer:
 
Work is in progress on the new Custom and Excise Ac t 2004; the tariff rate for aircraft and aircraft 
parts is yet to be finalized. 
The Consumption Tax (CT) rate will be 15 per cent.  The CT will be levied on aircraft and aircraft 
parts for domestic airlines. 
The CT will be levied on aircraft and aircraft parts for international airlines but the tax will be 
refunded when the aircraft leaves Tonga. 
V. TRADE-RELATED INTELLECTUAL PROPERTY REGIME 
Question 57 Paragraph 155:  Will there be legislation pr oviding for the protection of undisclosed data? 
Answer:
 
Protection against unfair commercial use of undisclo sed data is provided for under Section 9 of the 
Protection Against Unfair Competition Act 2002 which reads as follows.  WT/ACC/TON/12 
 Page 21 
 
 
 (1) Any act or practice, in the course of industr ial or commercial activities, that results in the 
disclosure, acquisition or use of secret informa tion without the consent of the person lawfully 
in control of that information (hereinafter re ferred to as "the rightful holder") and in a manner 
contrary to honest commercial practices sh all constitute an act of unfair competition. 
(2)  Disclosure, acquisition or use of secret info rmation by others without the consent of the 
rightful holder may, inter alia , result from – 
 (a) industrial or commercial espionage; 
 (b) breach of contract;  (c) breach of confidence;  (d) inducement to commit any of the acts referred to in paragraphs (a) to (c); 
 (e) acquisition of secret information by a th ird party who knew, or was grossly negligent 
in failing to know, that an act referred to in  paragraphs (a) to (d) was involved in the 
acquisition. 
(3) For the purposes of this section, information shall be considered secret information if - 
 (a) it is not, as a body or in the precise configuration and assembly of its components, 
generally known among or readily accessible to pe rsons within the circles that normally deal 
with the kind of information in question; 
 (b) it has commercial value because it is secret; and   (c) the rightful holder has taken reasonable steps to keep it secret. 
(4) Any act or practice in the course of industria l or commercial activities shall be deemed to be 
an act of unfair competition if it consists or r esults in the unfair commercial use or disclosure 
of secret tests or other data relating to pha rmaceutical or agricultural chemical products 
utilising new chemical substances and which ha ve been submitted to a competent authority 
for marketing approval.  Provided that disclosure shall be authorised -  
 (a) where necessary to protect the public; or 
 (b) where steps are taken to ensure that th e data are protected against unfair commercial 
use. 
(5) Subsection (4) shall not preclude a person who submitted the secret test or other data from 
relying on such test data in support of an app lication for product approval, after the expiration 
of a reasonable period of time from the date of su bmission of these tests or data for marketing 
approval. 
(6) The period of time under subsection (5) shall be  determined by the court, upon application, 
taking into account the nature of the tests or da ta and the effort and expenditure involved but 
shall not, except in exceptional circumstances, be less than 5 years. 
Question 58 
Paragraph 158:  What steps has Tonga taken to secure the technical assistance it needs to 
adequately enforce the WTO TRIPS Agreement? 
Answer:
 
The legal section of WIPO is providing Tonga with  technical assistance to draft intellectual property 
legislation. WT/ACC/TON/12 
Page 22  
 
 Question 59 
This section requires information on how Tong a currently pursues enforcement of intellectual 
property rights violations.  What criminal and ci vil penalties exist and who applies them?  Does 
customs stop and seize goods with pirated intellectual property?  Has anyone ever been 
prosecuted? 
Answer:
 
The draft Law on the Enforcement of Intellectual Property Rights including Border Measures (known 
as the Enforcement Bill) provides me asures to remedy or prevent the violation of intellectual property 
rights protected under the laws of Tonga.  A copy of this draft legislation is available through the document WT/ACC/TON/12/Add.1. 
The Enforcement Bill also empowers the Minist er to establish a cooperative body consisting of 
officials from the Customs, Police and Intellectua l Property Departments to conduct necessary tasks 
relating to the enforcement of Intellectual Property Rights. 
The Enforcement Bill does not impose any criminal  penalties for the infringement of intellectual 
property rights.  Although the Enforcement Bill do es not stipulate any specific civil penalties for 
infringement, it stipulates procedures and measures fo r the Court and Customs Department to follow 
in infringement or imminent infringement situations. 
With reference to the Enforcement Bill, the following are measures and remedies which may be 
granted or ordered by the court to the a ggrieved party in infringement situations: 
- An injunction to prevent further infringement or imminent infringement; 
- Provisional measures to prevent likely irre parable harm of imminent infringement; 
- Award damages; 
- Award compensation; - Order the infringer to relay information to the right holder regarding the counterfeit or pirated 
goods; 
- Order the "pirated copyright goods" and/or "counterfeit trademark goods" to be destroyed; 
- Any other remedy provided for in the general law. 
The Enforcement Bill empowers the Customs Depart ment to suspend the customs clearance and 
release into free circulation of imported counterfeit trademark goods or pirated copyright goods in the 
following circumstances: (a) upon receiving a Court order to that effect; (b) upon the Customs Department’s own initiative (temporary measure to enab le the property right to apply to the court for 
an order to suspend the customs clearance of these goods). 
With regards to penalties, pursuant to Section 43( 4) of the Industrial Property Act 1994, infringement 
of owner’s right can lead to liability upon conviction to a fine of T$5,000 or imprisonment for a term 
of 5 years or both.  
Question 60 
Tonga belongs to the Paris and Berne Conv entions.  How does it enforce obligations?  WT/ACC/TON/12 
 Page 23 
 
 
 Answer:  
Care is taken to ensure that all Intellectual Propert y legislation is in line with the provisions of both 
the Paris and Berne Conventions.  The provisions, such  as those relating to national treatment, priority 
and protected properties are fully enforced. 
Question 61 
Paragraph 159:  Is the 1 January 2005 date for enactment of Tonga’s legislation still viable? 
Answer:   
The Amendments to the Industrial Property Act 19 94 and the Enforcement and Border Measures Bill 
have been submitted to Cabinet prior to submi ssion to the Law Reform Committee for verification 
before submission to Parliament for consideration. 
The Regulations for the Geographical Indicati on Act 2002 and Protection of Layout Designs 
(Topographies) of Integrated Circuits Act 2002 have been endorsed by Cabinet for submission to the 
Law Reform Committee.  
Question 62 
Paragraph 159: we would appreciate an update on the current status of draft legislation 
referred to in the paragraph. 
Answer:  
Please refer to the Answer to question 61 above. 
Question 63 
Paragraphs 163-165 and Table 10: Table 10 should be  adjusted to indicate that the drafting and 
enactment of the listed legislation was accomplished prior to accession. 
Answer:  
Below is a revised version of Table 10: 
Action Deadline 
Drafting of new legislations, covering: 
- protection of undisclosed information and trade secrets; 
- plant variety protection; 
- general and enforcement obligations under the TRIPS   
Agreement. Protection of undisclosed 
information and trade secrets is 
provided for by section 9 of the 
Protection Against Unfair Competition Act 2002 
  
[Plant variety protection legislation will be drafted no 
later than 1 July 2006] WT/ACC/TON/12 
Page 24  
 
 Action Deadline 
Drafting of amendments to existing legislations to address deficiencies 
vis-à-vis the WTO Agreement on TRIP S as identified in response to 
WT/ACC/9, specifically: 
- Industrial Property Act 1994; 
- Copyright Act 2002. Copyright Act 2002 has been 
enacted.  
Amendments to Industrial 
Property Act 2004 have been 
submitted to Cabinet prior to 
submission to Law Reform Committee for verification. 
Circulation of draft legislation addressing remaining deficiencies vis-à-
vis the WTO TRIPS Agreement in Tonga's intellectual property rights 
regime. [July 2004] 
Parliamentary passage of new legislations and amendments to existing 
legislations. [No later than 1 July 2006] 
Drafting of implementing regulations for Intellectual Property 
legislations, specifically: 
- Geographical Indications Act 2001; - Protection of Layout Designs (Topographies) of Integrated   
Circuits Act 2001; 
- new legislations required, as detailed above. [No later than 1 July 2005] 
Development of manuals and operating procedures [No later than 1 January 2006] 
Appointment of staff [No later than 1 January 2006] 
Training of key IP personnel [No later than 1 July 2006] 
Training for users (development of information brochure and training 
program) [No later than 1 January 2007] 
Full implementation of the Agreement on Trade-Related Aspects of 
Intellectual Property Rights. [No later than 1 January 2007] 
 
It should be noted that no regulations are requi red for implementation of the Copyrights Act 2002.  
The Copyrights Act 2002 has been  enacted and will be implemented by 1 July 2006. 
Question 64 
We support the first of the two bracketed commitments.  We would like to know what part of 
the first version Tonga doesn’t support. 
Answer:  
Tonga is prepared to consider commitment language proposed by members. 
VII. TRANSPARENCY 
- Publication of information on trade Question 65 
Paragraphs 174-175: What steps has Tonga taken to secure technical assistance or to initiate 
domestic efforts to implement this commitment?  What discussions are taking place in Tonga to 
deal with this issue? 
Answer:
 
Trade information will be published on the Ministry  of Labour, Commerce & Industries website.  An 
investment promotion website is in the process of  being set up by the Industries division of the  WT/ACC/TON/12 
 Page 25 
 
 
 Ministry of Labour, Commerce & Industries.  Ongoi ng technical assistance is being provided by the 
Multilateral Investment Guarantee Agency (MIGA) , a member of the World Bank Group, to Forum 
Island Countries (FICs).  The Ministry of Labour, Co mmerce & Industries is also consulting with the 
Government IT Unit, Ministry of Finance, for t echnical assistance.  This website will be used a 
website for the whole Ministry of Labour, Commerce & Industries. WT/ACC/TON/12 
Page 26  
 
 ANNEX 1 
Legislation Status Report 
 
Name of Legislation Progress Status Report 
Consumption Tax To come into effect on 1 April 2005. 
Elimination of Ports and Services Tax, Sales Tax and 
Fuel Sales Tax To be eliminated on 1 April 2005. 
Income Tax Bill Due to be submitted to Parliament in the 2005 
session.  It is anticipated that it will be implemented by 1 December 2005. 
Customs & Excise Bill 2004 Currently in final stages of drafting.  It is intended 
that the Customs & Excise Bill will be passed by 
Parliament in 2005. 
Introduction of single rate customs duty (Amendments to Customs & Excise Act) It is intended that a reduction to a single rate duty, 
which has tentatively been set at 15%, will occur in 
gradual steps.  It is anticipated that the first reduction 
to a single rate of 25% will occur by 1 July 2006 and the second reduction to a single rate of 15% will 
occur by 1 January 2007 at the latest. 
Excise taxes (Amendments to Customs & Excise 
Act) Will be introduced by amendments to Customs & 
Excise Act. 
Elimination of quantitative restrictions on eggs, cabin and ship's biscuits an d alcohol (Amendment to 
Customs & Excise Act) Will be eliminated by amendments to Customs & 
Excise Act. 
Business Licence Regulations 2002 The draf t Business Licence Regulations have been 
forwarded to the Crown Law Department for review prior to being submitted to the Cabinet for approval.  
It is anticipated that the Regulations will be 
implemented by December 2005. 
Foreign Investment Regulations 2002 The draft Foreign Investment Regulations have been 
forwarded to the Crown Law Department for review 
prior to being submitted to the Cabinet for approval.  It is anticipated that the Regulations will be 
implemented by December 2005. 
Removal of reference to local agricultural and fish 
products not subject to price control from Mark-Up Schedule of Prices and Wages Act 1988 A submission will be made to the Competent 
Authority to issue an order to remove reference to local agricultural and fish  products not subject to 
price control from the Mark-Up Schedule by 1 June 
2005. 
Repeal of Industrial De velopment Incentives (IDI) 
Act The IDI Act will be suspended on 1 July 2006 and 
subsequently repealed once customs duties have been 
reduced to the single rate of 15%.  However, it 
should be noted that the provisions of the IDI Act that exempt development licence holders from the 
ports and services tax will cease to have effect when 
the ports and services tax is eliminated on 1 April 
2005 by the Port and Se rvice (Repeal) Act 2003. 
Provisions for enhanced transparency Work is on progress on the Ministry of Labour, 
Commerce & Industries website which is currently 
under construction.  The website will be functioning 
by accession. 
Amendments to Industrial Property Act 1994 Th e draft has been submitt ed to the Cabinet for 
endorsement before submission to the Law Reform Committee for verification and then to Parliament for 
consideration. 
Copyright Act 2002 Has been enacted.  WT/ACC/TON/12 
 Page 27 
 
 
 Name of Legislation Progress Status Report 
Enforcement & Border Measures Bill The draft has been submitted to the Cabinet for 
endorsement before submission to the Law Reform Committee for verification and then to Parliament for 
consideration. 
Regulations for Geographical Indications Act 2002 
and Protection of Layout Designs (Topographies) of 
Integrated Circuits Act 2002 Final drafts have been endorsed by Cabinet and 
submitted to the Law Reform Committee. 
 
Note: The following legislations are submitted to the Secr etariat and notified in document WT/ACC/TON/12/Add.1. 
- Final draft Foreign Inve stment Regulations 2002; 
- Final draft Business Licence Regulations 2002;  
- Draft Customs and Excise Bill 2004;  
- Customs and Excise Amendment Act 2003; 
- Draft Enforcement and Border Measures Bill; and  
- Draft Regulations for Geographical Indications Act 2002  
- Draft Regulations for Layout Designs (Topogr aphies) of Integrated Circuits Act 2002  WT/ACC/TON/12 
Page 28  
 
 ANNEX 2 
Table 1
 
Ministry of Agriculture, Forestry & Food (MAFF) Domestic Support 2000/2001 Measures funded by the Government of Tonga (excluding external funding)  
Measure Type Nature of Measure Funding (TOP) in 
2000/2001 
Research Program Administration 102,665 
Vegetable Research 2,605 
Coffee and Spice Research 105,885 
Watermelon Research & Development 1,111 
Squash Research & Development 1,465 
Papaya Research & Development 1,119 
Kava Research & Development 919 
Vanilla Research & Development 4,614 
Plant Nutrition Research 4,933 
Soil Condition Research 37,220 
Crop Water Requirement Research 3,209 
Root Crop Research & Development 14,390 
Animal Health Research 62,883 Research 
Subtotal 343,017 
Insect & Fruitfly Surveillance 46,163 
Squash Virus Research 4,805 
Insect & Fruitfly Research 9,281 
Insect Collection 1,104 
Multiplication of Disease Free Varieties 14,093 
Papaya Disease Resist Research 2,984 
Laboratory Maintenance 5,601 
Quarantine Services Administration 83,104 
Quarantine Operations 86,630 
Waste Control and Treatment 105,044 Pest and 
Disease Control 
Subtotal 358,808 
Human Resource Planning & Training 46,551 
Staff and Farmers Training 1,282 
Staff and Farmers Training 1,471 
Livestock Farmer Training 2,430 
Training in Nutrition, Cooking, Tree Planting and Maintenance 4,365 Training 
Subtotal 56,099 
Diagnosis of Farmers' Needs 998 
Export and Organic Certification 2,018 
Information Program Administration 22,363 
Publications 2,761 
Library 3,637 
Export Operations 78,607 
Extension Monitoring, Evaluati on and Impact Assessment 845 
Extension Programme Administration 25,481 
District Advisory Committee Support 3,732 
Diagnosis of Women's Needs 966 
District Advisory Committee Support 827 
Extension Program Administration 143,445 Extension & 
Advisory Services 
Subtotal 285,679 
Total 1,043,604 
Source: Ministry of Agriculture, Forestry & Food 
__________