RESTRICTED
WORLD TRADE WT/ACC/SAU/9
6November 1996
ORGANIZATION(96-4682)
Original: English
ACCESSION OFTHE KINGDOM OFSAUDI ARABIA
Information Concerning theInternational Conformity Certificate Programme (ICCP)
I. Background
TheSaudi Arabian Standards Organization (SASO) wasestablished in1972andwasentrusted
withthepreparation andadoption ofSaudi national standards. TheMinistry ofCommerce (MOC)
isresponsible forensuring thatproducts imported intoSaudi Arabia comply withSaudi standards related
tohealth andsafety inthecontext ofthecountry 'sphysical environment, culture andreligion.
Saudi Arabian Standards Organization (SASO) makes useofinternational standards very
extensively. Some international standards areadopted astheyarewhile others areusedasmain
references andadapted tolocalcircumstances. Forexample, theSaudi ISO9000 series ofstandards
isbased onthese international standards. International standards arenotusedwhen theyareunsuited
toSaudi Arabia 'sharsh anddesert climate. Safety requirements inSaudi Arabia areincluded inthe
technical standards. These technical requirements aredesigned toprotect theconsumer byremoving
inferior quality products from themarket. TheSaudi conformity assessment system procedures are
mainly based ontheinternationally recognized ISO/IEC guides andother ISOguidelines.
II. Rationale
TheICCP wasintroduced toensure proper enforcement ofSASO 'sstandards inaccordance
withISO/IEC guides.
Under theprevious system ofself-certification, withSASO issuing certificates ofconformity
validforoneortwoyears, many abuses occurred andattheendofthesystem failed toprovide adequate
protection oflocalconsumers.
Itwasdetermined thattoensure proper enforcement ofstandards forproducts found tobe
particularly susceptible tosub-standard imports, itwould benecessary toobtain certification ofstandards
compliance forevery shipment. However, Saudi Arabia 'sdomestic laboratory testing capacity was,
andremains, inadequate todealwith thisenhanced level ofstandards conformity assessment.
Accordingly, itwasdecided tomove, withrespect toimports, toasystem ofpre-shipment certifications
bySASO approved enterprises incountry ofexport.
III. Implementation
Under theICCP, preshipment activities canbeperformed inthecustoms territory fromwhich
thegoods areexported orthecustoms territory inwhich thegoods aremanufactured. Theinspection
location isthedecision oftheexporter.
Thescope ofinspection compliance verification includes quality andquantity compliance
(including sampling andtesting, ifapplicable) butexcludes price verification.WT/ACC/SAU/9
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Forreasons ofcosteffectiveness, itwasdetermined thatathirdparty (toactasprogramme
manager) toassist SASO inimplementing theICCP. SASO hasemployed theProgramme Manager
touseitsregional offices:
- tomake available toexporters onrequest details oftheinternational standards compliance
procedures drawn upbySASO;
- torecommend, forapproval bySASO, competent enterprises, toactasProgramme Country
Offices (PCOs) inmost ofthecountries trading withSaudi Arabia.
PCOs ensure observance ofICCP procedures bylocalexporters (including, where necessary,
testing byqualified labs), register andmaintain listsofcompliant exporters andissue pre-shipment
certificates ofstandards compliance. Forproducts falling under theICCP, SASO willmaintain its
standard practices inregard to:
- accreditation offoreign testing laboratories inaccordance withassessments based onISO
regulations andguides suchasISOGuide 25;and/or mutual recognition agreements;
- recognition ofothertesting results, certificates orquality marks onimported products accredited
byrelevant entities inother countries which willresult inreduced testing requirements for
ICCP products.
InOctober 1996, foreign embassies inSaudi Arabia wereinvited toseekfromtheirauthorities
nominations ofnationally accredited testing laboratories toparticipate intheICCP implementation.
Once approved bySASO, suchlaboratories would undertake ICCP compliance certification. Certified
products would besubject torandom sampling bySASO.
IV. Fees
TheICCP feestructure isbased ondeclared f.o.b. value oftheshipment without consideration
tothemethod ofshipment ornumber ofcontainers, pallets orcartons. Theprice structure canbe
summarized asfollows:
US$0-200,000 0.5% (0.005) off.o.b. orminimum feeofUS$350
US$200,000 -1,000,000 US$1,000plus0.4%(0.004)off.o.b.exceedingUS$200,000
US$1,000,000 andabove US$4,200 plus0.15% off.o.b. exceeding US$1,000,000
FeeschargedundertheICCPprogrammeareequitableinrelationtofeeschargedforcompliance
ofproducts ofnational origin. ICCP feesarelowbyinternational standards, aretransparent, predictable,
non-discriminatory, andreflect costofservice. While PSIschemes aregenerally based onadvalorem
fees,theinternational practice forlaboratory testing isfixed prices. Under ICCP, when testing is
applicable, fixed prices areapplied atstandard competitive rates.
V. Listing/Registration
Thelisting/registration programme hasbeencreated tohelpexporters worldwide ensure the
products imported intotheKingdom demonstrate continued compliance withthestandards developed
byorapproved bySASO.
Thelevelofparticipation intheICCP bycompanies worldwide hasincreased significantly.
Thetotalnumber ofcertificates ofconformity issued bytheendofSeptember 1996 exceeded 8826
certificates, andbyendofOctober 1996 thetotalexceeded 12,000 certificates. Total number ofWT/ACC/SAU/9
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companies registered intheprogramme bytheendofSeptember 1996 exceeded 800companies and
bytheendofOctober 1996 ithadexceeded 950companies from 44different countries.
VI. Transparency Issues
(a) Prior notification
Before itsintroduction, draftdetails oftheICCP were published andcomments invited. In
particular:
- detailed information about ICCP wassenttotheCouncil ofSaudi Chambers ofCommerce
andIndustry in1994 todistribute tothelocalbusiness andtrading community inviting them
toattend meetings withSASO tobeconducted inmajor centres;
- meetings were heldindifferent centres topermit SASO toadvise details ofthescheme and
discuss implementation dates, e.g.Riyadh withCouncil ofSaudi Chambers ofCommerce and
Industry(27November1994),DammanwithlocalChamberofCommerce(18February1995),
Jeddah Chamber ofCommerce andIndustry (11April 1995);
- inMarch andApril 1995, advertisements wereplaced inEnglish andArabic inbothnational
andinternational published press announcing details ofthescheme;
- on1November 1995letters weresenttoSaudi embassies worldwide advising themtonotify
localbusiness communities oftheintroduction oftheICCP;
- atthesame timetheSaudi business community andtheSaudi media were advised ofthe
implementation date;
- theprogramme wasimplemented on8November 1995.
(b) PostImplementation Consultations
Since implementation on8November 1995:
- theSASO Board ofDirectors determined on26December 1995, toadvise allimporters of
asixmonth grace period before preshipment certification would beenforced;
- inApril andMay1996, SASO metwithgovernment andbusiness representatives toclarify
aspects oftheICCP andtoreceive suggestions onimproving implementation; among meetings
heldwere:
- meetings attheItalian Embassy withsenior European businessmen;
- meetings withRiyadh andJeddah Chambers ofCommerce involving international as
wellasnational business communities;
- meetings inRiyadh withtrade sections offoreign embassies.
Asaresult ofthisactivity, many representations were taken intoaccount. Thisresulted in
modifications totheICCP thatsimplified itsprocedures.WT/ACC/SAU/9
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(c) Advice toexporters
ICCP Procedures Guidelines (the most recent being Version 8reproduced in
WT/ACC/SAU/6/Add.1)arereadilyandconvenientlyavailabletoexporters.Documentationisavailable
inEnglish aswellasArabic. TheICCP Procedures Guidelines documentation canbeobtained from
SASO, Saudi Embassies andtheProgramme Manager. Guidelines listProgramme Country Offices
(PCOs) from which anyrequired clarification canbeobtained. ICCP Guidelines arenowavailable
ontheInternet toanycompany orindividual worldwide under:
http://world.std.com/ ~inchcape/saso.html
VII. Protection ofConfidential Business Information
Asindicated insection 6ofVersion 8oftheICCP Guidelines (seeWT/ACC/SAU/6/Add.1),
theProgramme Manager offers considerable assurance ofconfidentiality. Butperhaps thebestguarantee
ofitsintegrity andpractices isthefactthattheProgramme Manager hascarried out23Government
PSIProgrammes forover12years, without anyquestion everbeing raised about therelease of
confidential information.
VIII. Standards Compliance ofNational Products
When anational factory requests aproduction licence theapplication must beaccompanied
byastatement fromtheproducer stating thathisproducts comply withrelevant standards. Furthermore,
thefactory willbemonitored bytheMinistries ofIndustry, Commerce andMunicipalities toensure
compliance withthestandards. There hastobeanequipped quality control laboratory inside thefactory
working onacontinuous basis toensure, interalia,compliance withstandards.
Thefactory willbesubjected tocontinuous inspection conducted bytheconcerned ministries
orSASO, which willwithdraw samples onaregular basis fromtheproduction linesandwarehouses
totestandanalyze themtoensure compliance withstandards. Ministry ofCommerce Quality Control
Labscarry outinspections, testandanalyze alltherawmaterials andother inputs tomake surethey
comply withthestandards.
When anational factory applies foraQuality Mark orConformity Certificate, SASO willcarry
outaninspection ontheproduction lines. Afactory willnotbegiven aQuality Mark orConformity
Certificate unless ithasbeensubjected toalltherequirements andconditions tomake surethatthe
products comply withSaudi standards. Market follow-up andinspection arecarried outtoensure that
theproducts continuously comply withthestandards.
IX. WTO Compliance
Intheview ofSaudi Arabia, theICCP complies withtherequirements ofGATT 1994, the
AgreementonTechnicalBarrierstoTrade(TBT),theAgreementonSanitaryandPhytosanitaryMeasures
(SPS) andtheAgreement onPre-shipment Inspection (PSI). Itisunclear whether theAgreement on
ImportLicensingProcedures(ILP)appliessincethepre-shipmentmeasuresinquestionwouldnotappear
tobecovered byArticle 1ofthatAgreement. Inparticular:
(a) GATTArticle1m.f.n.treatment(amplifiedinTBTArticle5.1.1andPSIArticle2.1)isassured
sinceallexporters haveready access tothecertification process andProgramme Country Offices
have beenestablished formost countries trading withSaudi Arabia; moreover, SASO is
preparedtoentertainrequestsforaccreditationofadditionaltestinglaboratoriesand,forcountries
notyetrepresented, toestablish aProgramme Country Office;WT/ACC/SAU/9
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(b) Defacto, GATT 1994 Article IIIcompliant, "national treatment" isassured under theICCP.
Likeallpre-shipment schemes, theICCP applies onlytoimports. Formally distinct procedures
fordomestic andimported products areexplicitly accepted inTBT Article 5.1.1 andPSI
Article 2.2.Thestandards administered under theICCP areidentical forbothdomestic and
imported products. Procedures ensuring domestic standards compliance ofdomestic products
substantially parallel those ofICCP;
(c) theICCP feestructure conforms toGATT 1994 Article VIII.1, thePSIAgreement issilent
onthequestion offees. However, according toaWorld Bank Discussion Paper published
in1995, feesof1percentoff.o.b. value iscommon forPSIschemes. TheICCP rateof
0.15percent-0.5percent,advalorem, reflects thecostofservices rendered, doesnotafford
indirect protection todomestic products anddoesnotconstitute taxation ofimports;
(d) because SASO 'sprocedures, including those oftheICCP, comply withISOguidelines, they
donotcreate unnecessary obstacle totrade andarenotmore strict thanisnecessary toensure
"adequate confidence" ofstandards conformity (TBT Article 5.1.12.);
(e) Saudi Arabia considers ithasmetthetransparency requirements ofGATT 1994 Article X.1
andTBTArticle 5.2.2.