. /.   WORLD TRADE  
ORGANIZATION  WT/GC/W/616 
9 December 2009 
 
 (09-6381) 
General Council 
17-18 December 2009 Original:   English 
 
 
 
REVIEW OF THE EXEMPTION PROVIDED 
UNDER PARAGRAPH 3 OF GATT 1994 
 
Questionnaire to the United States from Japan  
 
  The following communication, dated 9 December 2009, is being circulated at the request of 
the Delegation of Japan.  
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  Japan appreciates the information contained in the notification WT/L/746 submitted by the 
US in January this year pursuant to paragra ph 3(c) of the GATT 1994 as well as the responses from 
the US to Japan's questionnaire WT/GC/W/580 at the time of the previous session of the review. 
 
 Japan, however, is of the view that the res ponses provided as of now by  the US do not fully 
explain the need to continue this exemption measure.  In addition, as the previous review in 2007 was 
conducted under the previous US administration and many changes have taken place in various areas 
since the new US administration took the office, it is Japan's view that sufficient explanation is 
needed regarding whether or not the US continu es to see that the situation that necessitated this 
exemption still exists.   In this regard, Japan wishes to further contri bute to the review process at this time by raising 
relevant questions as below.  Japan would like to ask the US to respond to the following points in the 
form of a WTO official document within a reasonable period of time so that all Members can share 
the responses for their consideration. 
 Question 1
 
  In light of the fact that the exemption is a serious deviation from the fundamental principles 
of the GATT and that it has been maintained for as long as 15 years, further continuing this exemption 
will harm the consistency of the entire WTO legal framework.  Furthermore, its continuation may be 
misused by other Members as an excuse for creating or maintaining their trade barriers.  What is the 
view of the US on this point?  
Question 2
 
  It is assumed that the US Jones Act has the e ffect of increasing physical distribution costs to 
the users of US domestic maritime transportation,  especially in cases where shipping is the only 
economically reasonable means of transportation.  Moreover, maritime is the only sector that is 
influenced by this peculiar regulation, unlike other modes of transportation such as air, rail and road 
where foreign-made aircraft, rolling stock and trucks can be used without any such restrictions.  This 
means that competitive conditions are seemingly di storted among those transportation modes, and WT/GC/W/616 
Page 2  
 
  therefore, not only does the Jones Act affect the US  maritime industry, but also it may even have a 
distorting effect on world trade, contrary to the spir it of trade liberalization under the WTO.  What is 
the view of the US on these points?  Question 3
 
 
 With regard to the level of the shipbuilding and maintenance capacity that is essential for US 
national security, the US responded to Japan's quest ionnaire in 2007 that it had no quantitative criteria 
and that it only had qualitative criteria.  Unl ess quantitative criteria or other concrete grounds are 
objectively shown, the US remains able in practice to make unilateral decisions to maintain this 
exemption, since there is a very large amount of r oom for arbitrary decisions on whether or not the 
exemption is necessary.  What is the view of the US on this point?  What actions have been taken or 
will be taken by the US for making these criteria clear and transparent?  Question 4
 
 
 With regard to "additional information on the u se, sale, lease or repair of relevant vessels 
covered by this exemption" as stipulated in pa ragraph 3(c), the response by the US to Japan's 
questionnaire on this point in 2007 was that the US di d not have a source for this information.  Since 
the US is required to provide such information a nnually pursuant to the said paragraph, the US should 
find and ensure the means in order to obtain the "additional information" and make a submission of 
such information, which is also  essential to prevent undermining the credibility of the GATT and the 
WTO system.  What actions have been taken or will be taken by the US on this point? 
 
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