WORLD TRADE  
ORGANIZATION  TN/RL/W/187 
12 September 2005 
 
 (05-3939) 
Negotiating Group on Rules Original:   English 
  
 
BEST PRACTICE FOR RTAS/FTAS IN APEC
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Communication from Chile and the Republic of Korea  
  
 The following communication, dated 6 September 2005, is being circulated at the request of 
the Delegations of Chile and the Republic of Korea, for information.  
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 RTAs/FTAs involving APEC economies can b est support the achievement of the APEC 
Bogor Goals by having the following characteristics:  
Consistency with APEC Principles and Goals 
  They address the relevant areas in Part I (Lib eralization and Facilitation) of the Osaka Action 
Agenda (OAA) and they are consis tent with its General Principles. In this way they help to 
ensure that APEC accomplishes the free trade a nd investment goals set out in the 1994 Bogor 
Leaders Declaration. 
 
 They build upon work being undertaken by APEC. 
  Consistent with APEC goals, they promote st ructural reform among the parties through the 
implementation of transparent, open and non-discriminatory regulatory frameworks and 
decision-making processes. 
 Consistency with the WTO 
 
 They are fully consistent with the disciplin es of the WTO, especially those contained in 
Article XXIV of the GATT and Article V of the GATS. 
 
 When they involve developing economies to w hom the Enabling Clause applies, they are, 
whenever possible, consistent with Article XXIV of the GATT and Article V of the GATS. 
 
Go beyond WTO Commitments 
  In areas that are covered by the WTO, they build upon existing WTO obligations. They also 
explore commitments related to trade and invest ment in areas not covered, or only partly 
covered, by the WTO. By so doing, APEC economies are in a better position to provide 
leadership in any future WT O negotiations on these issues. 
 
                                                     
 
1 Regional Trade Arrangements (RTAs), Free Tr ade Agreements (FTAs), and other Preferential 
Arrangements. TN/RL/W/187 
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 Comprehensiveness 
 
 They deliver the maximum economic benefits to the parties by being comprehensive in scope, 
and providing for liberalization in all sectors. They therefore eliminate barriers to trade and 
investment between the Parties, including tariffs  and non-tariff measures, and barriers to trade 
in services. 
  Phase-out periods for tariffs and quotas in sensitiv e sectors are kept to a minimum, and take 
into account the different levels of development among the parties. Thus, they are seen as an 
opportunity to undertake liberalization in all sectors as a first step towards multilateral 
liberalization at a later stage.  
 
Transparency 
 
 By making the texts of RTAs/FTAs, including a ny annexes or schedules, readily available, 
the Parties ensure that business is in the b est position to understand and take advantage of 
liberalized trade conditions. Once they have b een signed, agreements are made public, in 
English wherever possible, through official websites as well as through the APEC Secretariat 
website. 
  Member economies notify and report their new a nd existing agreements in line with WTO 
obligations and procedures. 
 
Trade Facilitation 
 
 Recognizing that regulatory and administra tive requirements and processes can constitute 
significant barriers to trade, they include pr actical measures and cooperative efforts to 
facilitate trade and reduce transaction costs for business consistent with relevant WTO 
provisions and APEC principles. 
 
Mechanisms for Consultation and Dispute Settlement 
  Recognizing that disputes over implementation of  RTAs/FTAs can be costly  and can raise 
uncertainty for business, they include pr oper mechanisms to prevent and resolve 
disagreements in an expeditious manner, su ch as through consultation, mediation or 
arbitration, avoiding duplication with the WTO dispute settlement mechanism where appropriate. 
 
Simple Rules of Origin that facilitate Trade 
 
 To avoid the possibility of high compliance co sts for business, Rules of Origin (ROOs) are 
easy to understand and to comply with. Wherever possible, an economy’s ROOs are consistent across all of its FTAs and RTAs. 
 
 They recognize the increasingly globalized nature of production and the achievements of 
APEC in promoting regional economic integra tion by adopting ROOs that maximize trade 
creation and minimize trade distortion. 
 Cooperation 
 
 They include commitments on economic and te chnical cooperation in the relevant areas 
reflected in Part II of the OAA by providing scope for the parties to exchange views and  TN/RL/W/187 
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 develop common understandings in  which future interactio n will help ensure these 
agreements have maximum utility and benefit to all parties. 
 
Sustainable Development 
  Reflecting the inter-dependent and mutually supp ortive linkages between the three pillars of 
sustainable development – economic developmen t, social development and environmental 
protection – of which trade is an integral component, they reinforce the objectives of sustainable development.  
 Accession of Third Parties 
 
 Consistent with APEC´s philosophy of open re gionalism and as a way to contribute to the 
momentum for liberalization throughout the APEC  region, they are open to the possibility for 
accession of third parties on negotiated terms and conditions. 
 
Provision for Periodic Review 
 
 They allow for periodic review to ensure full implementation of the terms of the agreement 
and to ensure the terms continue to provid e the maximum possible economic benefit to the 
parties in the face of changing economic circumstances and trade and investment flows. 
Periodic review helps to maintain the mo mentum for domestic reform and further 
liberalization by addressing areas that may not have been considered during the original negotiations, promoting deeper liberalization a nd introducing more sophisticated mechanisms 
for cooperation as the economies of the Parties become more integrated. 
 
 
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