WORLD TRADE  
ORGANIZATION  WT/COMTD/W/175 
30 September 2010 
 (10-4977) 
Committee on Trade and Development Original:   English 
  
 
SYSTEMIC AND SPECIFIC ISSUES ARISING OUT OF THE DUAL NOTIFICATION  
OF THE GULF COOPERATION COUNCIL CUSTOMS UNION 
 
Communication from China,  Egypt and India
 
 
 
 The following communication, dated 29 September,  2010, is being circulated at the request of 
the delegations of China, Egypt and India.   
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 1. On 19 November 2007, the Gulf Coopera tion Council Customs Union (GCC-CU) was 
notified to the Committee on Trade and Developm ent (CTD) under the 1979 Decision on Differential 
and More Favourable Treatment, Reciprocity and fu ller Participation of Developing Countries (the 
"Enabling Clause").  The GCC-CU notification was then discussed in the CTD under the agenda item 
"Other Business" in the 69
th, 70th, 71st and 72nd Sessions of the CTD held in May, July, October and 
December 2008 respectively.  The notification of the GCC-CU has been di scussed under the agenda 
item "Notification under the Enabling Clause" in the CTD since its 73rd Session held in March 2009.  
The sub-agenda item "Gulf Cooperation Council (GCC) Notification of Customs Union" was 
introduced at the request of a developed Member1 over concerns that the notification of the GCC-CU 
had been made exclusively on the basis of the En abling Clause.  Some developed country Members 
did not favour moving forward with the process of  reviewing the GCC-CU in the CTD until further 
clarification was sought on the legal justification for such a procedure.  The GCC-CU was latter 
notified to the Committee on Regional Trade Agreements (CRTA) under Article XXIV of 
GATT 1994 on 6 October 2009.2 
2. The CTD has not yet arrived at a consensus on th e issue of notification and consideration of 
the GCC-CU, notwithstanding the justifications provi ded in support of the notification made under the 
Enabling Clause and despite the assertion by the CT D Chairperson that the GCC-CU was scheduled 
for factual consideration at a CTD de dicated session (CTD-DS) in October 2008.3  Instead, the 
subsequent notification under Article XXIV of GAT T was deemed, by some developed Members, the 
legal premise for examining this RTA in the CRTA. 
3. Systemic concerns have been raised by deve loping Members over the legal and procedural 
implications of the dual notification of the GCC-CU to both the CTD and the CRTA and the undertaking to refer the GCC-CU to the CRTA.  These systemic concerns impinge on the mandate 
and Terms of Reference of (i) the Enabling Clause
4;  (ii) the CTD5;  (iii) the Transparency Mechanism 
                                                      
1 WT/COMTD/M/73, paragraph 32. 
2 WT/REG276/N/1 and WT/REG276/N/1/Rev.1. 
3 WT/COMTD/M/69, paragraph 8. 
4 Paragraph 4 of the Terms of Reference of the CTD entitles this Committee "to consider any questions 
which may arise with regard to either the application or the use of special provisions in the Multilateral Trade WT/COMTD/W/175 
Page 2  
 
  for Regional Trade Agreements;  and (iv) the right s and obligations of Members in a manner that 
extends to the realm of strengthening the multilatera l trading system and its development dimension 
as highlighted by the Seventh WTO Ministerial Conference.
6 
4. This communication enumerates some systemic and specific concerns and implications 
related to the dual notification of the GCC-CU.  A consensus on an acceptable way to deal with 
GCC-CU and its notification under the Enabling Cl ause in the CTD is thus contingent on the 
following systemic concerns. 
(a) The arrangements accorded in favour of developing countries under the 
1979 Decision on Differential and More Favour able Treatment, Reciprocity and fuller 
Participation of Developing Countries (the Enabling Clause); 
(i) It has been the view of some developed Members that the Enabling Clause 
does not provide the appropriate legal basis for justifying the formation of a customs union that involves the elimination or reduction of non-tariff measures.  To the contrary, it has been argued by the GCC, that the 
non-adoption or prescription of criteria or conditions for the elimination of 
non-tariff measures does not exclude customs unions providing for the 
elimination of non-tariff measures from the coverage of the Enabling Clause
7, 
nor should this impair de veloping Members' rights in taking such actions 
within their regional trade agreements (RTAs).  It is submitted that an agreement should be reached on the interpretation of the second part of 
paragraph 2(c) of the Enabling Clause in order to determine whether or not it 
may be used as a basis for the notifi cation of customs unions providing for 
the reduction or elimination of non-tariff measures. 
(ii) The requirement that Members fulfil their WTO commitments, including 
commitments made in the run-up to their accession to notify RTAs they are party to on the basis of Article XXIV of GATT 1994 is not disputed.  Rather, 
there is need to address the systemic c oncerns regarding the extent to which a 
Member's accession commitments to notify a certain RTA on the basis of Article XXIV should have precedence over or deny the other Members party to the same RTA the right to notify this agreement to the CTD under the Enabling clause.  As submitted in this  communication, the dual notification 
of this agreement raises a number of  questions and systemic concerns. 
(b) The mandate and Terms of Reference of the CTD 
(i) It has been the view of some developed Members that the dual notification is 
an issue that is to be considered by  WTO bodies other than the CTD.  On the 
contrary, several developing Members ha ve submitted that the CTD is the 
most appropriate forum to consider this  issue since paragraph 1 of its Terms 
of Reference
8 stipulates that it is " to serve as a focal point for consideration 
                                                                                                                                                                     
Agreements and related Ministerial Decisions in favour of developing country Members and report to the 
General Council for appropriate action". 
5 Paragraph 1 of the CTD's TOR's, the CTD is "t o serve as a focal poin t for consideration and 
coordination of work on development in the World Trade Organization (WTO)".  Hence, the CTD should not casually pass on this systemic issue neither to be dealt with by other bodies in the WTO nor refer it to the 
negotiating group on rules. 
6 WT/MIN(09)/18. 
7 WT/COMTD/66/Add.3, paragraphs 6 and 7. 
8 WT/L/46.  WT/COMTD/W/175 
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  and coordination of work on developmen t in the World Trade Organization 
(WTO) … ".  Moreover, paragraph 4 of th e Terms of Reference of the CTD 
entrusts this Committee " to consider any questions which may arise with 
regard to either the application or the use of special provisions in the 
Multilateral Trade Agreements and related Mi nisterial Decisions in favour of 
developing country Members (including the invocation of the Enabling 
Clause to notify custom unions among developing countries) and report to the General Council for appropriate action".  
(ii) Other systemic issues have been raised by some developing Members in 
connection to the suggestion that the GCC-CU be considered within the 
CRTA.  They have submitted that if consideration of an RTA among 
developing countries notified under the Enabling Clause is to be conducted 
by the CRTA, this should be carried out according to the procedures and Terms of Reference provided by the CTD to the CRTA.  Such Terms of Reference are particularly important si nce the adoption of the Transparency 
Mechanism for Regional Trade Agreements
9 provides no procedures for 
consideration of RTAs with dual notifi cation.  Moreover, the consideration 
process of the GCC-CU has already b een set in motion in the CTD, as 
elaborated by the CTD Chairperson in the 69th CTD meeting.10  This process 
is consistent with paragraph 6 of the Transparency Mechanism.  There has been no subsequent decision in the CTD to interrupt the process of 
considering the GCC-CU in a CTD-DS. 
(c) The Transparency Mechanism fo r Regional Trade Agreements. 
The Transparency Mechanism for Regional Trade Agreements
11 in the section on 
"Bodies Entrusted with the Implementation of the Mechanism" states in paragraph 18 that 
"The Committee on Regional Trade Agreements  ("CRTA") and the Committee on Trade and 
Development ("CTD") are instruct ed to implement this Transparency Mechanism.  The CRTA 
shall do so for RTAs falling under Article XXIV of GATT 1994 and Article V of GATS, while 
the CTD shall do so for RTAs falling under paragraph 2(c) of the Enabling Clause.  For purposes of performing the functions establis hed under this Mechanism, the CTD shall 
convene in dedicated session. "  It is clear therefore, that th e Transparency Mechanism did not 
envisage a situation of dual notification of  an RTA and, accordingly, does not provide 
procedures for a dual consideration of an RTA.  Members would thus need to deliberate and 
decide on the issue of consideration on the GCC-CU. 
(d) List of other systemic issues 
Based on the arguments presented above, the CTD should consider the following in 
considering the GCC-CU dual notification: 
(i) The legal and procedural implications of notifying the GCC-CU on the basis 
of the Enabling Clause and Article XXIV of GATT 1994, without either notification being withdrawn. 
                                                     
 
9 WT/L/671. 
10 WT/COMTD/M/69, paragraph 3. 
11 WT/L/671, 18 December 2006. WT/COMTD/W/175 
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  (ii) If an RTA is notified under both the Enabling Clause and Article XXIV of 
GATT 1994, what should be the role of CTD and the CRTA, in considering the RTA? 
(iii) How should the CTD deal in the future with RTAs between developing 
Members that are notified under the Enabli ng Clause, insofar as this relates to 
the fulfilment of paragraphs 1 and 4 of  the Terms of Reference of the CTD? 
(iv) Can a Member notify an RTA under a specific legal provision unilaterally 
without the consent of other parties to the RTA?  Or if a notification could have been made on behalf of all the parties to the RTA under another legal 
provisions? 
(v) What are the implications arising from Members retaining a notification 
under the Enabling Clause but not conducting a factual consideration of the RTA in the CTD.  How would this figure specifically in the case of the GCC-CU where a factual review of this RTA had been scheduled. 
5. Members may keep the aforementioned concerns  in mind while discussing the issue in the 
CTD.  The CTD could consult with other WTO bodies  in addressing the above issues in keeping with 
paragraph 3 of its Terms of Refe rence which entrusts the CTD  " To review periodically, in 
consultation as appropriate with the relevant bodies of the WTO, the app lication of special provisions in 
the Multilateral Trade Agreements and related Minister ial Decisions in favour of developing country 
Members, and in particular least- developed country Members, and re port to the General Council for 
appropriate action ". 
 
  
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