. /.   WORLD TRADE  
ORGANIZATION  TN/TF/W/77 
10 February 2006 
 (06-0590) 
Negotiating Group on Trade Facilitation Original:   English 
  
 
COMMUNICATION FROM INDIA 
  
 The following communication, dated 9 February 2006, from the Delegation of India, is being 
circulated in advance of the Negotiating Group meeting of 15-16 February. 
 
 
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PROPOSAL ON GATT ARTICLE VIII 
 
 
I. INTRODUCTION 
1. The negotiations on Trade Facilitation present an  opportunity to improve border clearance 
procedures relating to customs and other border cl earance requirements. The Annex D modality under 
the July Framework puts special emphasis on identification of needs and priorities of developing countries as an integral part of the trade facilitatio n negotiations. India has attempted to identify the 
needs and priorities of its exporters through surv eys. Based on the feedback received, India has 
identified those issues relating to border clearance which are not yet part of the negotiating proposals. 
These proposals are covered under the scope of GATT Article VIII. The proposals are aimed at 
addressing some specific problems faced by exporters. 
II. PROPOSALS 
2. Surveys and studies indicate that in a customs union, different member states adopt different 
border procedures such as standards (including term inologies, definitions, methods and procedures of 
sampling and analysis) for border clearance of agri culture and food products, such as for the presence 
of contaminants. This leads to differential treatment  for the same goods by different member states of 
a customs union leading to acceptance of the same c onsignment at certain ports while being rejected 
at others. This creates  uncertainty to trade a nd causes a market access barrier. Hence, it is proposed 
that members of a customs union should adopt the same border procedures which should include 
adoption of same standards including specifica tions, terminologies and definitions, inspection, 
sampling and test methods, for border cl earance of agriculture and food products .  
3. Surveys and studies have indicated that testi ng methods for imported goods adopted by some 
Members do not at times take into account their physical  state. This leads to wrong test results thereby 
acting as a barrier to goods clearance.  For instance, it has been rev ealed that the same sensitivity 
criteria are applied in some countries/customs territo ries for testing both fresh and dry products. This 
leads to divergent results as the concentration of  a product increases on account of loss of water. For 
instance red chilli loses 60% of its weight upon dryi ng and shrimp loses 90% of its weight upon 
freeze-drying, which alter the percentages of various  contents considerably when analyzed on a wet 
basis or a dry basis. It is therefore proposed that, during the negotiations, we should adopt the TN/TF/W/77 
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  principle that testing methods should be based on specific product features and its physical state at the 
point of consumption, such as 'fresh', 'dehydrated' or 'otherwise processed' . 
4. Surveys and studies indicate that documentation requirements in a customs union are at times 
not uniform. It has been observed that at times differe nt agencies have authorized  different versions of 
authentication forms. This compels an exporter to arrange for differen t formats of the form such as 
certificate of origin depending on the final destinati on of the product. It is proposed that all forms and 
documentation requirements relating to import clearance should be uniform  for all members of a 
customs union.  
5. Surveys and studies indicate that some Memb ers have at times followed a system of 
destruction of a rejected food consignment instead of  returning them to the exporter. This denies the 
exporter an opportunity to segregate the consignmen t into smaller lots and to examine each lot in 
detail and to identify the bad lots if possible. Fu rthermore, non-destruction would help the exporter 
salvage the consignment. This can be done by re turning the consignment to the exporting country. No 
system of clearance of goods should be such that, on a routine basis, it leads to the destruction of 
cargo at the point of import on account of lack of conformity with standards. It is therefore proposed 
that all Members should have a provision that in  case of rejection of a consignment on account of 
failure to meet certain standards, an option would be  first given to return the rejected goods to the 
exporter  and only upon a failure to exercise this option within a reasonable period of time, any other 
course of action, including destructi on of goods could be considered.  
6. In the ongoing negotiations, proposals have been made for adopting a system of authorized 
traders to extend expedited clearance to compliant traders upon fulfilment of certain criteria. In order 
to realize the full trade facilitative potential of any such system, if it is agreed upon during the 
negotiations, it is important to adopt the principle that norms for authorized trader systems shall be 
applied uniformly  across a customs union and recognition of a trader as an authorized trader in one 
member of a customs union should automatically extend to the other members of the customs union.  
7. In the ongoing negotiations, proposals have been made for adopting a risk management 
system for goods clearance. In order to realize the fu ll trade facilitative potential of this system, it is 
important that a customs union should apply, to the extent possible, a harmonized risk management 
system  across the entire customs union so that goods are cleared under similar circumstances in all 
member states of a customs union.  
III. TECHNICAL ASSISTANCE 
8. Most of the proposals are aimed at improving bo rder clearance procedures through procedural 
improvements. This may not require specific technical assistance. Some other proposals are more in 
the nature of systemic issues and may not again re quire any significant amount of technical assistance 
and capacity building. There may however be need to  organize Workshops at th e international level to 
apprise the border clearance officials of the requirement s in force.  We are open to discuss this issue.  
 
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