WORLD TRADE  
ORGANIZATION  G/C/W/532 
27 October 2005 
 
 (05-4992) 
Council for Trade in Goods Original:   English 
  
 
TRANSITIONAL REVIEW MECHANISM PURSUANT TO PARAGRAPH 18  
OF THE PROTOCOL ON THE ACCESSION OF THE  
PEOPLE’S REPUBLIC OF CHINA (“CHINA”)  
 
Questions from JAPAN to CHINA
 
 
  The following communication, dated 26 October 2005, is being circulated at the request of the Delegation of Japan. 
______________ 
 
Authorizing system of complete automobile feature
 
 
 Japan thanks China for the responses provided so far at the last MA committee. However, 
Japan believes that some of its questions have unf ortunately not been responded to yet. Using this 
valuable opportunity, Japan wishes to  ask for the following elaborations on some of the questions that 
it had posed to China, as part of th e transitional review mechanism.  
 
 Japan understands that customs duties shall be  imposed at the point of time when goods are 
entering the importing country. If the unit of imported goods is an automobile component only, the 
customs duty shall be for the automobile compone nt itself. Therefore, in cases where customs 
authorities impose different higher tariff rates such as that of fully assembled vehicles on automobile 
components in a retrospective manner, Japan suspects it is inconsistent with Article II of the GATT. 
In this context, Japan would like to urge China to  clarify its rationale under the WTO obligations on 
this issue. 
 
Resources protection of fluorite  
  In the TRM of Council of Trade in Goods held  last year, China explained that the measures 
for protection of natural resources is maintained for fluorite.   
 What is China’s assessment of fluorite as an  exhaustible natural resource taking into 
consideration the amount of deposit in China, the amount of deposit all over the world and the trend 
of supply and demand in the future? 
 
 GATT Article XX sets forth a general exception as long as the measures are made effective in 
conjunction with domestic pr oduction or consumption.  
  Thus, in taking measures for the protection of natural resources, an even-handed treatment 
between domestic consumers and overseas consumers is required.  
  It seems that the production of fluorite in Ch ina is increasing. But the export permission 
amount of the fluorite of China is not increasing at all.  
 G/C/W/532 
Page 2  
 
  It could be said that the export control of fluorite is intended to fulfil the increase in the 
domestic demand of it.   
 Please provide Japan with detailed informati on on the regulation which China has imposed on 
the fluorite users in China.  
 Does China consider the regulation on domest ic production and/or consumption to be 
justified considering the amount of deposit in Chin a, the amount of deposit all over the world and the 
trend of supply and demand in the future? 
 
Export Restrictions
 
 
 In the TRM of Council of Trade in Goods held  last year, China explained that the measures 
for protection of natural resources is maintained for cokes.  
 
 What is China’s assessment of cokes as an exhaustible natural resource taking into 
consideration the amount of deposit in China, the amount of deposit all over the world and the trend 
of supply and demand in the future? 
  Japan understands that China implements expor t licensing on to exports of cokes. Because 
insufficient licenses were issued la st year, the export price of Chinese cokes soared and has left the 
market disrupted. This year, although there have not been any big disruptions so far, the export 
licensing measure still exists. Japan is greatly con cerned about the issuance plan for 2005 because half 
of all licenses remain unissued. Since this measure  is not made effective in conjunction with 
restrictions on domestic production or consumption, Japan considers that it is not consistent with 
GATT Article XI and cannot be justified under GATT Article XX (g) regarding the conservation of 
exhaustible natural resources. 
 
In view of the above, Japan would like to urge China: 
 -  to provide detailed information about its regulation on domestic production and/or 
consumption. Does China considers the re gulation on domestic production and/or 
consumption to be justified c onsidering the amount of deposit in  China, the amount of deposit 
all over the world and the trend of supply and demand in the future? 
 
-  to clarify its position on the cons istency of export licensing measures,   
 
 if any, with the WTO rules regarding such export restrictions. 
  If there is any plan to reform the export licensing measure, Japan would like to know the 
details. 
 
Government procurement
 
 
 At the Working Party for WTO accession, Ch ina committed itself to initiating negotiations 
for its membership in the Government Procurem ent Agreement (GPA)(see Report of the Working 
Party, para.339). China also agreed to table an Appendix 1 offer as soon as possible and, until such a time, require all government entities to conduct thei r procurement in a transparent manner and to 
provide all foreign suppliers with an equal opportunity to participat e in the procurement pursuant to 
the principle of MFN.   G/C/W/532 
 Page 3 
 
 
  Please outline the schedule for China's requ ests for GPA membership, including the 
commencement of the negotiation process.  
 Please confirm that all government procuremen t procedures are conducted in a transparent 
manner and that the MFN principle is applie d to all foreign suppliers in practice. 
 
__________