WORLD TRADE  
ORGANIZATION   
WT/REG282/2 
17 June 2011  
 
(11-3011) 
Committee on Regional Trade Agreements Original:   English 
  
 
FREE TRADE AGREEMENT BETWEEN TURKEY AND MONTENEGRO 
(GOODS) 
 
Questions and Replies 
 
 
 The following communication, dated 16 June 2011,  is being circulated at the request of the 
delegations of Turkey and Montenegro.  
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Questions from the Delegation of the United States 
Liberalization of Trade and Tariff Lines  
 
1. According to Paragraphs 20 and 21 and Annex I of the Factual Presentation, 
Table A.I1-A.I2:  
 Turkey eliminates tariffs on 81.2% of all ta riff lines covering 99.7% of imports from 
Montenegro under the Agreement .  However, although 96.3% of industrial tariffs are 
duty-free and only 12.9% of agricultural ta riff lines are duty-free under the Agreement.  
Under the Turkey-Montenegro FTA, Turkey only eliminated duties on 0.5% of its agricultural tariffs that were not already MFN duty free.  
 
 Montenegro eliminates duties on 78.1% of all tariff lines covering 90.1% of imports 
from Turkey under the Agreement.  However,  though 95% of industrial tariffs are 
duty-free, only 14.8% of agricultural ta riff lines are duty-free under the Agreement.  
Under the Turkey-Montenegro FTA, Montenegro only eliminated duties on 0.8% of its 
agricultural tariffs that were not already MFN duty free. 
 
(a) How does Turkey and Montenegro ex plain its highly disproportionate 
liberalization between the industrial and agricultural sectors?  
 Regarding bilateral trade between Turkey and Montenegro in the year 2010, the agricultural 
products and the industrial products consist of approximately 8% and 92% of the total bilateral trade 
respectively.  Taking into account the sensitivity of the agricultural sector and its small share in total 
bilateral trade, the Parties preferred to liberalize mainly  their industrial sector.  In this respect, Turkey 
abolished customs tariffs on all indus trial products originating in Montenegro on the date of entry into 
force of the Agreement and Montenegro will abolish those tariffs in five years after the Agreement 
enters into force.  On the other hand, Parties exchanged concessions on selected agricultural products 
as an initial liberalization process.  
   WT/REG282/2 
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   Article 10 of the Agreement states that "taking into account the role of agriculture in their 
respective economies, the development of trade in ag ricultural products between the Parties, the high 
sensitivity of agricultural products and the rules of th eir respective agricultural policy, the Parties shall 
examine in the Joint Committee the possibilities of granting further c oncessions to each other in trade 
in agricultural products".  Moreover, it is also possible to grant further concessions if the Parties 
consider that it would be useful and in the interest  of the economies of the Pa rties.  In that sense, 
progressive liberalization for the agricultural products in the future may be provided. 
 
(b) How does Turkey and Montenegro explain the lack of agriculture commitments 
in the FTA? 
 The same explanation for paragraph (a ) above is valid for this question. 
 
(c) In light of the limited liberalization in the agricultural sector, could the Parties 
please explain how the level of tari ff elimination achieved meets the 
"substantially all trade" standard set out in GATT Article XXIV? 
 According to GATT XXIV:8, a free-trade ar ea means a group of two or more customs 
territories in which the duties and other restrict ive regulations of commerce are eliminated on 
substantially all the trade between the constituent terr itories in products originating in such territories. 
  In this sense, the Free Trade Agreement be tween Turkey and Montenegro envisages an 
establishment of a free trade area between the Parties on substantially all their trade over a transitional 
period lasting a maximum of five years starting from date of entry into force of this Agreement in 
conformity with Article XXIV of the GATT 1994.  In  this respect, the Parties preferred to liberalize 
both their industrial and agricultural sectors with th e Agreement.  Turkey abolished customs tariffs on 
all industrial products originating in Montenegro on the date of entry into force of the Agreement and 
Montenegro will abolish those tariffs in five years af ter the Agreement enter into force.  On the other 
hand, the Parties exchanged concessions on selected agricultural products as an initial liberalization 
process.    As a result of the concessions provided by th e Agreement, Turkey's 99.7% of total imports 
from Montenegro became duty free upon the Agreement' s entry into force and Montenegro's 90.1% of 
total imports from Turkey will become duty free in five  years after the Agreement enter into force.  In 
this regard, the substantially all trade requirement has been met. 
 
Sanitary and phytosanitary measures 
 
2. Paragraph 41 states that "veterinary and phytosanitary control measures shall be 
harmonized with the EU's legislation."  We note that the WTO SPS Agreement instructs 
Members to use the international standards de veloped by the three bodies referenced in the 
Agreement (Codex, OIE and IPPC), or if they choose, a higher level of protection based on a 
scientific justification provided by the party.  Could the Parties please explain how harmonizing 
their standards with EU legislation meet s their obligations under Article 3 of the 
WTO SPS Agreement? 
 Article 11.1 of the Agreement states that "The Parties shall apply their domestic regulations in 
the fields of veterinary, sanitary and phytosanitary  control in accordance with  the WTO Agreement on 
Sanitary and Phytosanitary Measur es."  In the following paragraph, it is stated that measures 
concerning veterinary and phytosanitary control am ong the Parties shall be harmonized on the basis of 
the EU legislation.  In other words, the Par ties not only aim to have veterinary, sanitary and 
phytosanitary control in conformity with WTO Agreement on the Application of Sanitary and 
Phytosanitary Measures but also to harmonize it on the basis of the EU legislation.   WT/REG282/2 
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   As it is known while Montenegro is a potential candidate country for EU accession, Turkey is 
a candidate country for EU membership and acce ssion negotiations continue since October 2005. 
Taking into consideration being candidate or potential candidate, both Parties have the aim to 
harmonize their legislation concerning veterinary a nd phytosanitary control on the basis of the EU 
legislation.  Although their first priority is to a pply their domestic regulations in accordance with the 
WTO rules, they do not abstain to state that they  will harmonize their measures concerning veterinary 
and phytosanitary control on the basis of the EU legisla tion.  It should also be underlined that not only 
Turkey and Montenegro but also EU is a WTO member.  
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