RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/GC/M/93 
8 April 2005 
 (05-1448) 
General Council 
28 February 2005  
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard  
on 28 February 2005  
 
Chairman:  Ms Amina Mohamed (Kenya) 
 
 Subject discussed
: Proposed Modification to Schedule CXL – European Communities:  
Prolongation of Rights under Ar ticle XXVIII of the GATT 1994 
(WT/GC/87, WT/GC/89)  
 
1. The Chairman  drew attention to the communication from the United States in document 
WT/GC/87 requesting a prolongation of its right s under Article XXVIII of the GATT 1994.  She 
recalled that this issue related to the modification of concessions by the EC pertaining to husked rice 
and semi-milled and milled rice, which had been no tified in 2003.  On 28 January 2005, the United 
States had notified Members that unless agreement could be reached with the EC regarding compensation, it would withdraw substantially e quivalent tariff concessions  effective midnight on 
1 March 2005, i.e. when the six-month period pr ovided for this purpose under Article XXVIII:3 
expired.  However, as the United States had indicat ed in its communication in WT/GC/87, it had been 
negotiating with the EC on a solution to this issue, which it hoped could be agr eed before 1 March.  In 
order to allow these negotiations to be able to c ontinue beyond this date, a nd to avoid having the US 
withdrawal of concessions take effect automatica lly at midnight on 1 March, it would be necessary to 
extend the deadline for exercising the United States ' rights under Article XXVIII.   The United States 
had therefore proposed that the General Council agree that any withdrawal of concessions by it in this 
connection after 1 March would be d eemed to have been taken within the six-month period referred to 
in Article XXVIII:3. 
2. Since the circulation of the US communication,  she had held consultations with all the 
Members who had been involved directly in the Ar ticle XXVIII negotiations with the EC, as well as 
those who had expressed a view on the subject of exte nsions of this nature on an earlier occasion in 
the General Council.  The EC had also engaged in further bilateral discussions with both the United 
States and other interested delegations.  She inv ited the United States and the European Communities 
to introduce this matter, as well as the revised te xt that was now being proposed for consideration 
following the consultations that had been held. 
3. The representative of the United States
 thanked the Chairman and Members for the 
opportunity to have the present meeting, and partic ularly wished to thank delegations for their 
patience in starting this meeting a little later than its originally scheduled time.  As Members were 
aware, in July 2003 the EC had notified the United States of its intention to modify certain tariff 
concessions on husked and milled rice.  The United States had Article XXVIII rights with respect to 
the EC's rice concession, and under Article XXVIII  of the GATT 1994, had entered into bilateral 
negotiations with the EC regarding the proposed ch ange in the EC schedule.  The EC had put into 
effect the new tariff rates on husked and milled rice on 1 September 2004.  However, the United WT/GC/M/93 
Page 2  
 
 States and the EC had continued to negotiate in this  regard.  On 28 January 2005, the United States 
had notified Members that it would withdraw s ubstantially equivalent  concessions under GATT 
Article XXVIII:3 if an agreement could not be r eached with the EC before 1 March 2005.  Under 
Article XXVIII:3, such a withdrawal would need to occur within six months of the EC's modification 
of its tariff concessions.  The US withdrawal of  concessions would take effect at midnight on 
1 March 2005, unless the United States provided further notice to Members prior to that time.  The 
United States now believed it had reached an agreem ent with the EC that would permit it to move 
forward without withdrawing tariff concessions on 1 Ma rch.  The two parties were in the process of 
finalizing that agreement.  An important part of the agreement was that US rights under Article XXVIII needed to be preserved after the six- month deadline, in the event that a problem arose 
with respect to the implementation of the agreement.   As a result, the United States had proposed that 
the General Council formally agree to extend the deadline for the United St ates to exercise its 
Article XXVIII rights.  A draft decision to that effe ct had been circulated to Members the previous 
week in document WT/GC/87, and the United Stat es asked the General Council to agree to that 
decision, although it also understood that the EC might  be suggesting a modified proposal in the light 
of recent consultations. 
4. The representative of the European Communities
 thanked the Chairman for her help and hard 
work in the recently held consulta tions, and joined the United States in thanking delegations who had 
been involved in the consultations for their unders tanding and cooperation in the discussions held to 
date, and those who had not been involved for th eir patience and understanding.  Following the EC 
notification to the WTO of 31 July 2003, circulated in G/SECRET/18, regarding its intention to 
modify concessions in its Schedule with respect to  husked and milled rice, his delegation had been 
conducting negotiations with Members it considered to have negotiating rights.  The Community had 
reached agreements with India and Pakistan, but th ese agreements had yet to be notified.  As the 
United States had stated, the EC had also reached agreement very recently with that delegation, and 
was continuing to try to reach agreement with Th ailand.  The EC had had a number of informal 
discussions with its trading partners regarding the form and presentation of the proposal submitted by 
the United States.  It believed that a solution ha d been found via the extension of rights under 
Article XXVIII:3, i.e. regarding the withdrawal of substantially equivalent concessions, to be agreed 
in the General Council.  Accordingly, in the course  of the consultations, the EC had put together a 
document which the Secretariat was in the process of circulating to Members as document WT/GC/89.  While this was being done, and in case de legations in the meeting room did not yet have 
the document, he wished to read out the text of th at document.  The first page was a simple paragraph 
which was a communication from the European Co mmunities, and the second page was a proposed 
decision of the General Council in a slightly different format from the one the United States had submitted.  The two pages read as follows:  
 "In continuation of the EC's notification of  31 July 2003, circulated in document 
G/SECRET/18, concerning the EC's intention to modify certain co ncessions concerning 
tariff items 1006 20 (husked rice) and 1006 30 (semi-milled and milled rice) in Schedule CXL of the European Communi ties, the Commission of the European 
Communities wishes hereby to inform that the EC will not assert that the United States, Thailand, India and Pakistan, as regards to their claims submitted pursuant to Article XXVIII of GATT 1994 and relating to th e said notification, are precluded from 
withdrawing substantially eq uivalent concessions under Article XXVIII:3 of GATT 1994 
because any such withdrawal does not occur within the six months  provided for in 
Article XXVIII:3 of GATT 1994." 
 5. This wording had been discussed at length with  those with whom the Chairman had been 
holding consultations.  The proposed decision, which was quite short and had some similarity to the 
communication, read as follows:  WT/GC/M/93 
 Page 3 
 
 
  "The General Council agrees that, consiste nt with EC communication WT/GC/89 dated 
28 February 2005 and in relation to the EC's notification of 31 July 2003 circulated in 
document G/SECRET/18, the United States, Thailand, India and Pakistan shall not be precluded from withdrawing subs tantially equivalent concessi ons under Article XXVIII:3 of 
GATT 1994 on the grounds that any such withdrawal does not occur within the six months 
provided for in Article XXVIII:3 of GATT 1994. 
  "This Decision shall not be treated as a pr ecedent in any future negotiations between 
Members under Article XXVIII of GATT 1994." 
 
6. As stated in the final sentence of the proposed decision, the EC did not consider that this 
approach should serve as a preced ent for future XXVIII negotiations.  He hoped that this provided 
some comfort to Members.  The EC also consider ed that the rice duties it would ultimately notify to 
the WTO as a modification to its Schedule CXL would maintain the general level of reciprocal and 
mutually advantageous concessions as existed before the modification.  He wished to conclude by 
confirming that, with the proposed decision, Thai land, India and Pakistan would not be precluded 
from withdrawing substantially e quivalent concessions on the grounds that written notice of such 
withdrawal did not occur in accordance with th e time-period provided for in Article XXVIII:3 of 
GATT 1994.  The Community hoped that the proposed decision would meet with all Members' satisfaction and could be adopted. 
7. The Chairman
 proposed for Members' considerati on that the General Council adopt the 
proposed decision as read out by the European Co mmunities, and which had been circulated to 
delegations in document WT/GC/89. 
8. The General Council took note  of the statements and so agreed . 
9. The representative of Philippines  said that his delegation was pleased with the resolution of 
this issue and encouraged the United States, the EC  and other parties to pursue their Article XXVIII 
negotiations so that this matter c ould be concluded as soon as possible.  He wished to raise the issue 
of transparency, and said that his delegation would appreciate it if, in the course of the conclusion of the Article XXVIII negotiations between the EC and other parties, the Philippines could be informed 
of what their expectation would be of the agreemen t reached, and what the EC intended to do with the 
agreements it might reach with the interested parties. 
10. The General Council took note
 of the statement. 
 
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