WORLD TRADE  
ORGANIZATION  WT/COMTD/51/Add.3 
17 February 2006 
 (06-0675) 
Committee on Trade and Development Original:   English 
  
FRAMEWORK AGREEMENT ON COMPRE HENSIVE ECONOMIC COOPERATION 
BETWEEN THE ASSOCIATION OF SOUTH EAST ASIAN NATIONS  
AND THE PEOPLE'S REPUBLIC OF CHINA 
 
Communication from the Parties to the Agreement
 
 
Addendum  
  
 The following communication dated 15 Febr uary 2006 has been received from the 
United States, and is being circulated at its request. 
 
_______________ 
 
 
Questions to the Parties of the  
 
China-ASEAN Framework Agreement on Comprehensive Economic  
Cooperation Between the Association of South East Asian Nations  
and the People's Republic of China (WT/COMTD/51) 
 
Protocol to Amend the Framework Agreement on Comprehensive Economic Cooperation 
Between the Association of South East Asian Nations and the People's Republic of China 
 
and the  
 
China-ASEAN Agreement on Trade in Goods of the Framework Agreement  
on Comprehensive Economic Cooperation Between the Association of  
South East Asian Nations and the People's Republic of China  
(WT/COMTD/51/Add.1) 
 
General
: 
 
1. The Protocol to Amend the Framework Agre ement on Comprehensiv e Economic Cooperation 
Between the Association of South East Asian Nati ons and the People's Republic of China contains 
important information about prod ucts included in and excluded from the Early Harvest Programme, 
and hence appears essential to the understanding of  the working of the liberalization plan.  We 
commend the ASEAN for having this document avai lable on its website, but wonder why it was not 
notified to the WTO.  Please provide your reasons for not transmitting this document in your 
notification.  2. Are there any other documents related to th e Comprehensive Economic Cooperation between 
China and the ASEAN that have not been notified to the WTO?  If so, please provide a list of the 
documents and information and how they can be accessed. 
 WT/COMTD/51/Add.3 
Page 2  
 
  3. Do the Parties have any plans to include envi ronmental or labor provisions in any of the 
agreements negotiated, or to be negotia ted, under the Framework Agreement?   
 Process
:  
 
4. Did all Parties complete their internal proce dures for entry into force of the agreement by 
1 January 2005, as provided in Article 23?    
(a) If not, please provide a list of which countries have not done so, and on what date did 
they, or do they intend to, complete their internal procedures?   
Trade Liberalization
: 
 
5. It appears from our reading of the Framewor k Agreement and the Agreement on Goods that 
there are three categories of liberalization for goo ds:  the Early Harvest Programme (EHP), Normal 
Track and Sensitive Track.  The Sensitive Track, in tu rn, has two subcategories: the Sensitive List and 
the Highly Sensitive List.   
 
(a) Please provide the Committee with data showing the percentage of tariff lines and 
trade flow for products covered under each of the four categories. 
(b) When all liberalization is completed, what percentage of tariff lines and trade flows 
will be duty free? 
(c) How many tariff lines are not included in any of the three categories, and what 
percentage of trade do those lines cover? 
6. From our review of the Agreements, the Protocol and the Annexes, many tariff lines, and in 
some cases, entire chapters, are not included in  any of the three categories.  For example, 
Chapters 9-27 do not appear on Brunei Darussalam's  Normal Track or Sensitive Track lists.  China 
does not appear to include Chapters 50, 53, 55 or 61 (among others) in its Normal Track or Sensitive 
Track lists.    
(a) Please explain why some tariff lines are excluded from the EHP and two Tracks. 
(b) What is the liberalization schedule for ta riff lines not in one of the categories? 
(c) For each Party, please provide the Committee with a list of chapters excluded from 
the EHP, the Normal Track or the Sensitive Track.   
7. Regarding the Early Harvest Programme, have China and ASEAN eliminated tariffs on all 
products not included in Annex 1 or Annex 2 of the Framework Agreement (as modified by the 
Protocol), as provided in Annex 3 of the Framew ork Agreement?  Have the newer ASEAN states 
completed their tariff reductions consistent  with the EHP schedule in Annex 3?   
 
8. Regarding the products in Annex 1 of the Framework Agreement (as amended by the 
Protocol) that are excluded from the Early Harvest Programme, are those products ever subject to liberalization under the Agreement?    
(a) What percentage of tariff lines in each Parties’ tariff schedule do these lines 
represent?  WT/COMTD/51/Add.3 
 Page 3 
 
 
  9. Regarding Annex 1 of the Ag reement on Goods, concerning the Normal Track Lists, the 
ASEAN 6 and China must each reduce at least 40 per cent of their tariffs to 0-5 per cent by 
1 July 2005.  Have those reductions or eliminations occurred?   
(a) Are the affected tariff lines available to the public? 
10. Please provide the Committee with an update on the current status of the upcoming deadlines 
for tariff rate liberalization scheduled for 1 Ja nuary 2007 under the Normal Track schedule.  
 
11. Cambodia's Normal Track List includes lines that appear on both the Early Harvest 
Programme and the Normal Track, and which are scheduled to be replaced no later than 
31 December 2004.     
 
(a) Has this replacement occurred?   
(b) If so, has a current list been circulated? 
(c) How is a line listed on two liberalization schedules treated? 
(d) Does any other Party currently have ta riff lines dually listed in two lists?  
12. China has included rice and rice products, rubber, palm oil, cars and auto parts, sugars, and 
tropical woods on its Highly Sensitive List.  These products constitute many of the highest volume 
goods traded in South East Asia.  Please provide th e Parties' views on how re taining 50 per cent tariffs 
indefinitely on such highly traded goods will pr omote and facilitate development in the region.   
 
13. It appears from Annexes 1 and 2 (Appendices 2 and 3, respectively, of the Protocol) that the 
Philippines has not yet provided its exclusion list nor  its specific products list for the Early Harvest 
Programme.  Nor has the Philippines provided a list of goods for inclusion on the Normal Track.    
(a) Has the Philippines negotiated these lists?   
(i) Are they available to the public?   
(ii) Is the Philippines simply exempted from the reduction requirements in 
subparagraphs 6(a) a nd (b) of Annex 1? 
14. Pursuant to Annex 1 of the Agreement on G oods, Vietnam's Normal Track list was to be 
determined by 31 December 2004;  pursuant to A nnex 2, Vietnam's ceiling of import value and the 
list of products on its Sensitive Tr ack lists were also to be determined by 31 December  2004.   
 
(a) What ceiling level was agreed to for Viet Nam? 
(b) Have the Normal Track and Sensitive Track lists been determined?   
(c) If so, have they been circulated? 
(d) If not, when will those negotiations be completed?   
15. According to the most recent trade data we ha ve for China and ASEAN [2000], it appears that 
there is significant overlap between ASEAN's majo r imports from the world and its major imports 
from China.  In such a situation, it appears th at trade diversion is a realistic possibility.  
Paragraph 3(a) of the Enabling Clause provides th at Enabling Clause agreements "shall be designed WT/COMTD/51/Add.3 
Page 4  
 
  … not to … create undue difficulties for the trade of any other" Members.  Please explain what steps 
the Parties have taken to ensure that the FTA has not created undue difficulties, in the form of trade 
diversion or otherwise, for the trade of other Members?  16. We are interested in the "Highly Sensitive Li st" products.  According to the Agreement, a 
Party can place up to 100 tariff subheadings (at the 6 digit line) or 40 per cent of the number of tariff 
lines on the Sensitive List on the Highly Sensitive List.  For these products, a Party may maintain 
tariffs up to 50 per cent, indefinitely.  In the curre nt NAMA discussions, anythi ng above 15 per cent is 
considered a tariff peak.  We understand the concept of sensitive products, but our approach is not to 
maintain tariffs of 50 per cent, but rather to exte nd the time period of which they are eliminated.   
Please provide the Parties' view of how allowing the i ndefinite retention of tariffs of up to 50 per cent 
will facilitate and promote trade and development.  
(a) For each Party, after full implementation of the ACFTA, what would be the 
trade-weighted (according to 2001 statistics) and simple average tariff rates for both 
the Sensitive List and Highly Sensitive List? 
17. Was an agreement reached on the treatment of ta riff lines of the Parties subject to in-quota 
and out-quota rates, including modalities for tariff re duction/elimination as scheduled to be completed 
no later than 31 March 2005?  If so, have the results of the discussions been circulated? 
 
Non-Tariff Barriers
:  
 
18. Article 3(8) of the Framework Agreement sets out a list of issues to be addressed in the FTA 
on goods.  Many of the items, such as tariff reducti ons/eliminations, rules of origin and safeguards, 
are included in the Agreement on Goods.  The remaining items, on TRQs, SPS measures, AD/CVD 
disciplines and TRIPS issues, do not appear to be addressed (although there is a provision concerning 
non-tariff barriers (NTBs)).  
 
(a) Could the Parties describe their plans to address these issues?   
(b) Has a timetable been agreed upon for their reduction or elimination? 
(c) Will the Parties notify any such add itional agreements to the WTO under 
Article XXIV?    
19. Pursuant to Article 8 of the Goods Agreem ent, the Parties agr ee to "identify … for 
elimination" all non-tariff barriers.  In response to  a question concerning the timing of elimination of 
NTBs, the Representative of China went on to say that the Parties "would notify any agreement on 
NTBs to the CTD".  [WT/COMTD/M/55, paragraph 68].    
(a) Has the timeframe for elimination of NTBs been  agreed upon?  If so, is it available to 
Members and the public? 
20. Article 8 of the Goods Agreement also requir es the Parties to make available and accessible  
information on the quantitative restrictions.  Is that  information available and accessible to the public?  
Where would a trader be able to obtain such information?  
21. Have product-specific rules of origin been negotiated, as provided for in Attachment B in 
Annex 3 of the Agreement on Goods?  If so, are they accessible to members of the business 
community? 
 
  WT/COMTD/51/Add.3 
 Page 5 
 
 
  Safeguards : 
 
22. Pursuant to Article 9 of the Goods Agreem ent, a Party may impose a safeguard measure 
within the "transition period".  The tran sition period is defined as five years after  the completion of 
duty elimination or reduction for that product.  Please provide the Parties' view as to why such an 
extensive "transition period" is necessary, and its consistency with the requirement that Enabling 
Clause agreements "facilitate and promote the trade of developing countries"?   
 23. Does the agreement contain a safeguard measure  for goods that are included in the "highly 
sensitive" goods list but do not have a transition period?  If so, please describe how the safeguard 
measure works and what products are covered. 
 
__________