WORLD TRADE
ORGANIZATIONWT/TPR/M/47
1 March 1999
(99-0761)
Trade Policy Review Body
20 and 22 January 1999
TRADE POLICY REVIEW
ARGENTINA
Minutes of Meeting
Chairperson:  H.E. Mr. Ali Said Mchumo (Tanzania)
Page
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON     3
II. OPENING STATEMENT BY THE REPRESENTATIVE OF ARGENTINA     4
III. STATEMENT BY THE FIRST DISCUSSANT     5
IV. STATEMENT BY THE SECOND DISCUSSANT     6
V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY     7
VI. REPLIES BY THE REPRESENTATIVE OF ARGENTINA AND
ADDITIONAL COMMENTS   12
VII. CONCLUDING REMARKS BY THE CHAIRPERSON   17
ANNEX I   20
ANNEX II   51WT/TPR/M/47
Page 3
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON
1. The second Trade Policy Review of Argentina was held on 20 and 22 January 1999.  The
Chairperson welcomed the delegation of Argentina, led by Dr. Felix Peña, Under-Secretary of Foreign
Trade of the Ministry of Economy, Works and Public Services, as well as H.E. Mr. Guillermo Enrique
González, and the discussants, H.E. Mr. Roger Farrell (New Zealand) and Dr. Vassili Notis (Greece).  As
usual, both discussants spoke in their personal capacities and not as representatives of their countries.  Inaccordance with the established procedures, the discussants had made available, in advance, an outline of
the main issues they intended to raise.
2. The Chairperson recalled the purpose of the Trade Policy Reviews and the main elements of the
procedures for the meeting.  The report by the Government of Argentina was contained in document
WT/TPR/G/47 and that of the WTO Secretariat in  document WT/TPR/S/47 and WT/TPR/S/47/Add.1; the
main issues to be raised by the discussants we re contained in document WT/TPR/D/32.  Copies of
advance written questions, submitted by 12 delegations (in the order submitted, Poland;Hong Kong, China;  Australia; Thailand;  Norway;  Japan;  Canada;  Korea (Rep. of);
  the European
Union;  New Zealand;  the United States;  and H ungary) had been transmitted to the delegation of
Argentina (Annex I).  Written responses by Argentina are reproduced in Annex II.  The Chairperson
noted that if full replies to all questions could not be provided during the meeting, supplementary written
replies would be provided later.WT/TPR/M/47
Page 4
II. OPENING STATEMENT BY THE REPRESENTATIVE OF ARGENTINA
3. The representative of Argentina reiterated his country's faith in the economic policy fundamentals
upon which stability- and growth-inducing reforms had been based; this policy was to be deepened and
adjusted to meet developmental and welfare objectives.  The Asian crisis had affected access to
international finance, had raised the cost of loans at the domestic market, and had slowed down
growth (4.9% in 1998).  The authorities had responde d with fiscal adjustment measures allowing for
anticipated finance from the World Bank and the Inter-American Development Bank, leaving the IMF as
the last recourse lender; this allowed Argentina to be the first emerging economy that had resumed access
to world financial markets after the Russian crisis.  Investment had not been affected and its GDP share
had doubled between 1990 and 1998; international reserves covered 100% of the monetary base.
Inflation remained below 1% and unemploym ent had dropped to 12.4% since 1995.  Between 1990
and 1998 imports had almost tripled and exports had gr own about sevenfold;  however, in 1998 the trade
deficit had widened as a result of stagnating export growth, relating to the decline of world commodityprices, and increased imports.
4. Trade liberalization in goods and services at regional and multilateral level formed part of
Argentina's policy objectives.  Structural reforms, which had been consolidated through participation in
the multilateral trading system and the MERCOSUR, were not to be affected by political changes.  Tariffs
affected about 5% of imports of MERCOSUR origi n, and a Common External Tariff (CET) was to fully
apply as from 2001, except for informatics and telecommunication goods for which the CET was to enter
in force in the year 2006.  Efforts for co-ordina tion of macroeconomic policies within MERCOSUR were
expected to culminate in 1999.  The agreements si gned between MERCOSUR and Bolivia, Chile, and
the EU, the participation in the FTAA process, as well as ongoing negotiations with the Andean
Community were indicative of an integration proce ss open to the world.  MERCOSUR had contributed to
the political stability, sectoral conversion, competitiveness and insertion of its members to the world
economy.
5. Since 1995, Argentina, an active participant in all multilateral negotiations, had complied strictly
with its WTO undertakings.  The Third WTO Ministerial Conference had to allow the launching of a
broad and comprehensive agenda for the future negotiations; the introduction of new issues had toobserve basic conditions such as consensus, equilibrium and the Single Undertaking.  Work for the
revision of existing multilateral agreements had to proceed without providing unjustified benefits for
certain Members or giving priorities to certain issues or allowing for premature sectoral exclusions.
Agriculture had to be fully incorporated into the multilateral trading system and the negotiations had to
cover the entire sector.  The dispute settlement mechanism required some fine-tuning, and all schools of
thought in law had to be represented at the WTO Secretariat; disputes had to be the exception in the
functioning of the WTO rather than a substitute to compliance for undertakings.
6. He concluded by saying that Argentina's trade policy reflected structural reforms and efforts to
integrate into the world economy; to maintain and consolidate this policy a stable macroeconomic
framework was required.WT/TPR/M/47
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III. STATEMENT BY THE FIRST DISCUSSANT
7. The first discussant (Dr. Vassili Notis) highlighted the results of Argentina's macroeconomic
reforms, including high GDP per-capita growth, low inflation, and substantial foreign direct investment
(FDI) inflows, as well as structural changes, increas ed productivity and rapid recovery from the impact of
the 1994 Mexican crisis.  Privatization had led to considerable industry concentration, particularly in the
services sector; this had indicated the need for adjustments and/or improvements in the legal frameworkgoverning competition and consumer protection policies.  He requested more information on
developments relating to increased unemployment, under-employment and poverty levels, as well as their
relationship with industry concentration; comments were also sought on the impact of competition within
MERCOSUR and on trade union rights in Argentina.  Public finance had relied on privatization revenue
and, subsequently, on abrupt changes in indirect tax rates (e.g. import duties, statistical tax), thus bringing
a degree of uncertainty to protection levels.  He wondered how the authorities were to cope with fiscal
deficit.  While recalling the benefits from the operation of a fixed exchange rate regime and the risingtrade deficit, he wanted to know how the authorities were to cope with the devaluation of the Brazilian
currency.
8. Argentina had complied with regular WTO notification procedures but improvements could be
made in the timely communication of new trade measures; he requested explanations on the reasons for
the lack of notification of several measures (e.g. duty and tax concessions, variable import levies, exportincentives).  Several components of Argentina's fiscally-driven trade and sectoral policies were
questioned.  In the light of the difference between applied tariff and binding levels, he asked whether the
latter were to be lowered in the forthcoming negotiations.  He recalled that increased tariffs on capital
goods, informatics and telecommunication equipment (since 1995) might affect investment and industrial
production.  More information was requested on the operational aspects of and prospects for theimplementation of minimum specific import duties (DIEM) on imports of textiles, clothing and footwear
originating outside of MERCOSUR.  He wondered a bout the WTO consistency of the variable import
levies on sugar imports.  Referring to the export assistance mechanisms in force, he inquired about
developments with respect to the introduction of an alternative scheme to that benefitting exports from
Patagonia, as well as about the TRIMs aspects of the programme on turnkey-plant contracts.
9. He noted that the dispersion of average tariff rates by industry was pronounced in the
manufacturing sector; in footwear, safeguards in form of DIEMs and increased ad valorem  duties on an
MFN basis affected imports from developed and de veloping countries.  He sought comments on the
duration of DIEMs affecting imports of textiles and clothing.  While recognizing Argentina's extensive
commitments under the GATS, he asked for the reasons  for maintaining cargo-sharing agreements and
about Argentina's intentions for the future negotiations on maritime transport.WT/TPR/M/47
Page 6
IV. STATEMENT BY THE SECOND DISCUSSANT
10. The second discussant (H.E. Mr. Roger Farrell) reco gnized that Trade Policy Reviews could be a
positive "action-inspiring" plank in the WTO process.  Argentina's trade policy strategy consisted of
unilateral, bilateral, regional/sub-regional, multilateral and fiscal components.  Import substitution had
been discarded largely, and MERCOSUR was a strong priority, a platform for connecting to the rest of
the world.  He wondered what were the main driving forces of Argentina's trade policy and whether sub-regional economic imperatives had overtaken unilatera l ones;  was it a MERCOS UR priority to shape
multilateral liberalization objectives?  While noting that fiscally-driven trade-related measures could be
unsettling, he sought assistance to gain a better understanding of the perceived implications of the fiscally
motivated policy approach.  He requested information on the operation of the Private Sector Advisory
Council on Foreign Trade as well as the response of the business community to the Registry of Barriers to
Argentine Exports.
11. He noted the modest levels of support to agriculture (except for sugar and tobacco), the
pronounced shift in the production pattern and the erosion of specific agricultural benefits to Argentina
from the Uruguay Round.  This situation explained Argentina's active contribution to the debate on the
conduct of future negotiations in agriculture and related topics on the WTO agenda.  He sought a
performance assessment in the light of policy objectives set for the agricultural sector.  He asked to know
about changes required in these policy objectives in view of the outlook of the production and marketenvironment for agricultural products.
12. The automotive sector, which had been particularly untouched by liberalization efforts, was
sensitive in terms of output, employment, domestic policy settings, and economic diplomacy at bilateral,
regional and multilateral level.  Consequently, Argentina was faced with a number of policy challenges.
He asked about the prospects for the sector's evolution in the years ahead, as well as whether the economyshould and could afford such protection levels.  He sought confirmation on the date of enforcement of a
common MERCOSUR régime, and inquired on whether it was to promote efficiency and international
competitiveness.
13. In the services sector, which made up for a large part of the economy, substantial liberalization
had been accomplished under the reform process.  Bearing in mind the improved levels of service and thelowering of costs and prices in telecommunications, he questioned the consistency between sectoral
objectives (openness and liberalization) and trade policy decisions, such as the imposition of tariffs on
informatics and telecommunications products and Argentina's non-participation in the Information
Technology Agreement.  Was there any overall trade and development strategy relating to
telecommunications and information technology?  While noting the scheduled removal of all special
national air carrier rights by the year 2000, he asked whether Argentina had looked at the advantages of
an "open skies" policy for increasing air cargo services to the benefit of its fresh produce and high-techtrade.WT/TPR/M/47
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V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY
14. Members congratulated Argentina for its successful reforms that had allowed real GDP per capita
to double, since the last Review, inflation to remain pa rticularly low and FDI inflows to be high as well as
its adherence to its policies despite the Asian crisis. They asked how the depreciation of the Brazilian
currency was to be dealt.  Delegations praised Argentina's role as an active player in WTO bodies as well
as its support for a comprehensive and balanced new round of multilateral trade negotiations.  They alsowelcomed its commitments in the services sector.  Several participants noticed Argentina's frequent
recourse to anti-dumping action and expressed the hope that this need was to be tempered.  Written
responses to advance questions (Annexes I and II) were expected; most issues covered by these questions
were not raised in oral presentations.
15. The representative of the United States stated that comments and questions from her delegation
were viewed in the context of the strong bilateral trade ties between Argentina and her country, as well as
Argentina's changes and challenges since its last Trade Policy Review.  Tariffs had been reduced, and,despite the global financial crisis, Argentina had recognized the importance of maintaining the
momentum of trade liberalization; nevertheless, serious questions were being posed on safeguards
implementation.  While expressing concern over an apparent deterioration in protection of intellectual
property rights (e.g. non-delivery of exclusive marketing rights for pharmaceuticals, weakened protection
of test data on agrochemicals), she said that Argentina was expected to comply in a timely manner withWTO provisions on Trade-Related Aspects of Inte llectual Property Rights (TRIPS).  Reforms and
liberalization in the services sector left scope for improvement in Argentina's GATS (General Agreement
on Trade in Services) commitments in the next round of negotiations.
16. The representative of Hong Kong, China comm ended Argentina for the successful structural
reform and price stabilization since 1989, and for Argentina's continued adherence to the policies in the
fact of the ASEAN financial crisis.  He said that Hong Kong, China's bilateral trade with Argentina had
decreased in 1998.  This change might be caused by many factors probably including certain recent
import documentation requirements.  He sought clarification on reports referring to the possibility of
expanding origin certification requirements to imports of toys.
17. He added that although this Trade Policy Revi ew was not about MERCOSUR, it could help to
improve Member's understanding of the interaction between Argentina's commitments under
MERCOSUR and the WTO.  While recognizing improvements in the structure and publication of the
customs tariff, he urged Argentina to take measures so as to ensure that duty levels were not increased as
a result of the convergence to the MERCOSUR CET.  He also expressed concern over related trends in
tariff escalation.  In the light of efforts in the area of government procurement, he encouraged openness to
all suppliers and improvement in transparency.
18. The representative of Australia stressed the main features of bilateral relations and economic
similarities between his country and Argentina, as well as their common interests in agriculture and the
latter's role as a member of the Cairns Group.  He noted MERCOSUR's positive effects in reinforcing
Argentina's reforms and in creating new investment opportunities.  However, convergence to the CET had
reversed earlier trends in reducing tariff escalation and trade diversion was a concern.  He sought
comments on the relation between further preferential access to regional partners and the multilateraltrade liberalization that Argentina strongly supported.
19. With respect to the global financial crisis, he raised questions on Argentina's position on a
tariff-related response within MERCOSUR as well as on plans to accelerate investigations for safeguardsWT/TPR/M/47
Page 8
and countervailing duties.  He sought a brief review on the performance of the National Commission on
Foreign Trade.
20. The representative of Norway praised Argentina's efforts to consolidate its policy reforms and to
pursue greater integration into the world economy through multilateral, sub-regional and bilateral
undertakings.  He expressed hope that recent developments in large neighbouring trading partners were
not to reverse the reform process.  More information was sought on the difference between maximumrates applied for loading (exports) and unloading (exports) containers. Mining investment incentives were
not positive to the overall economy.  He wondered whether there were plans to change the provisions
confining these incentives to individuals and corporations domiciled in Argentina.  Local-content
requirements, which applied in the automotive industry, were discriminatory and damaged resource
allocation.
21. The representative of Japan underlined bilateral trade links between his country and Argentina.
He praised Argentina's trade liberalization efforts and the elimination of foreign investment restrictions as
well as its efforts for economic stabilization.  He sought an appraisal of the effects of the recent crisis in
Brazil to Argentina as well as how it was to cope with resulting difficulties, particularly in light of its
foreign exchange régime.
22. He hoped that Argentina would influence MERCO SUR in complementing and strengthening the
multilateral trading system.  Japan considered that the import coverage of the MERCOSUR CET did notmeet GATT Article XXIV:8 provisions and that certain rates exceeded WTO binding levels.
23. He noted that price ranges or bands, comprising deposit requirements and time consuming
investigation, affected customs valuation for consumer electronics.  He asked for the criteria used for such
investigation as well as the WTO consistency of this measure.  Clarification was sought the timetable and
process for the elimination of the TRIMs (Trade-Relat ed Investment Measures) in the automotive sector;
Argentina was urged to provide replies to questions raised in the Committee on TRIMs on this matter.  He
raised questions on the stages for certification relating to new standards regulations for low-voltage
electrical equipment, and on the notification of this measure to the WTO.
24. In the context of the future negotiations, he said that Japan expected Argentina to undertake
further liberalization commitments in services that had not been covered so far.
25. The representative of Canada considered Argentina as a model of economic stability in
Argentina's region.  He praised its determination to maintain the momentum for reforms in the face of
both the Mexican and Asian crises as well as in light of the uncertainty affecting Brazil.  While
highlighting the bilateral trade and investment relations between his country and Argentina, he announced
the forthcoming signing of a final protocol allowing imports of Canadian pork into Argentina and of
Argentine beef into Canada.  Apart from the Trade and Investment Co-operation Agreement signed
between Canada and MERCOSUR in June 1998, bila teral discussions on a renewed Foreign Investment
Protection Agreement were under way.  In addition to FTAA (Free-Trade Area of the Americas) and
Cairns Group working relationships, close co-operation had been also extended on inter-parliamentary,
natural resources, and science and technology issues.
26. He added that regional trade agreements could have a positive contribution towards and act as a
catalyst for further multilateral trade liberalization.  However, his country was disappointed aboutMERCOSUR's tariff increase and tariff escalation.  He  expected Argentina to re-affirm its commitment to
further liberalization based on WTO principles; further openings were expected in the automotive sector,
and telecommunication equipment and services.WT/TPR/M/47
Page 9
27. The representative of Korea expressed the hope that Argentina's reforms were to expand trade
with Asia rather than with neighbouring countries only.  Although recent developments in Brazil and
exchange rate volatility could put economic growth at  risk, he hoped that Argentina was to maintain the
pace of reforms.  To stress Korea's concern about Argentina's trend in the use of anti-dumping measures,
he recalled the points raised on certain aspects of the Argentine legislation in the relevant
WTO Committee.
28. The representative of the European Union recogniz ed Argentina's role in the regional integration
efforts and the contribution of the MERCOSUR proce ss in the structural reforms of the Argentine
economy.  He hoped that the financial developments in Brazil and other regions were not to entail policy
changes.  Outward-oriented policy developments had allowed for a spectacular increase in both
EU exports and investment inflows to Argentina.  He expressed satisfaction with overall tariff reductions
relating to the adoption of the MERCOSUR CET and recalled the ongoing work on a trade liberalization
agreement between the EU-MERCOSUR.  Nevertheless , he regretted the implementation of safeguards
on footwear, anti-dumping and/or countervailing measures on certain items from the EU (e.g. olive oil,
wheat gluten, cables, steel tubes), as well as export measures on hides and skins.  Further progress in
patent protection was required.  To avoid a proliferat ion of trade disputes with Argentina, trade dialogue
and a new round of negotiations covering all sectors were required.
29. The representative of Hungary welcomed that so far the effects of the financial crisis had not
brought major changes in Argentina's economic performance and its open trade policies.  He noted
Argentina's sensitivity on the external balance and was interested what measures, if any, were under
consideration to prevent spillover effects of recent de velopments in the region.  In Hungary's view for the
containment of the crisis sweeping through the world it was absolutely essential to keep markets open.
He complimented Argentina for not only doing so even in the face of worsening trade balances, but forplaying an active role in advocating further liberaliz ation in the framework of a comprehensive new round
of trade talks and for participating constructively in the preparatory process for the Third WTO
Ministerial.
30. Despite the geographical distance, Argentina was an important trading partner for Hungary;
since 1996 the turnover of two-way trade had tripled and was close to US$80 million, with a significantHungarian deficit.  He expressed hope that the bilateral trade ties would continue to develop while
becoming somewhat more balanced.  With respect to specific trade policy measures he referred to the
written questions his delegation had put concerning the ad valorem  statistical tax and the changes in the
PSI regime.  He looked forward to receiving answers to the questions.
31. The representative of Uruguay underscored the considerable and significant progress that
Argentina had made and was continuing to make in the economic area since its previous Trade Policy
Review.  The Report by the WTO Secretariat revealed the in-depth reforms carried out by Argentinasince 1992, extending to almost every branch of the economy and radically changing the country's
economic situation.  At the same time, regional commitments had largely complemented the domestic
reforms and the multilateral commitments, and Argentin a's trade both within MERCOSUR and with third
countries had grown.
32. He pointed out that the statement in the Report according to which Argentine agricultural exports
faced serious barriers or unfair competition in certain markets also applied to other countries such as those
of the Cairns Group, which were experiencing the same kind of problems.  In spite of the severe financial
crisis that so affected the world economy in 1998 and th e drop in the prices of some of Argentina's major
export items such as cereals, the "Preliminary Overview of the Economies of Latin America and theWT/TPR/M/47
Page 10
Caribbean – 1998" recently published by the Economic  Commission for Latin America and the Caribbean
(ECLAC) stated that the GDP of Argentina had resumed its significant growth, that the rate of inflation
had once again remained low (1%), that investment had continued to grow and that the level of both
exports and imports had increased.  This Trade Policy Review provided an opportunity for recognizing
the enormous efforts made by Argentina in its domestic reforms aimed at liberalizing and deregulating the
economy, and its contribution to the expansion of regional and world trade.
33. The representative of Chile praised Argentina's structural reforms;  they had contributed to
successful macroeconomic performance, including improvement in employment levels.  She emphasized
several components of Argentina's success, including its unilateral trade liberalization in goods and
services, improvement of investment regulations , and the privatization process.  MERCOSUR had
consolidated its economic process and had turned into a major foreign trade component.  Bilateral
relations with her country had been strengthened and increased confidence to the economy had made
Argentina the main destination of Chilean investment.  Argentina was expected to cope well with theglobal financial crisis and pursue its reforms.
34. The representative of Colombia recognized that Argentina faced the same crisis-related problem
and challenges as other countries in the region.  Structural adjustment measures had applied in a
particularly rigorous manner but, for a number of reasons, it had not managed to improve Argentina's
social imbalance.  The parallel growth of GDP  per capita growth and poverty levels was a commonphenomenon in developing countries;  reforms affected each sector in a different manner.
35. Trade liberalization had affected the trade balance and had led to pressure for reinforced
protection in certain industries.  In certain trade policy areas, corrective action was necessary to allow
adjustment to WTO disciplines; in this respect, the Trade Policy Review Mechanism (TPRM) allowed
Members to draw attention to these areas.  He concluded by emphasizing Argentina's role in theconsolidation of the multilateral trading system and its contribution to a proper implementation of
Agreement on Trade in Agriculture.
36. The representative of India noted the limited impact of the Asian crisis on Argentina and hoped
that this situation would continue.  Argentina's economic reforms were complemented by support to
social programmes.  Trade liberalization formed part of structural reform and was based on regional andautonomous initiatives.  He looked forward to di scussing MERCOSUR trade policy as well as the
strategy for forging closer trade ties with other regions.  Argentine imports from Asia had declined as a
result of frequent changes in the level of border protection and the utilisation of anti-dumping measures.
He advised a concerted effort to assess and correct the impediments to trade with Asia.  Efforts towards
implementation of the provisions of the Agreement on  TRIPs, and law enforcement to curb piracy were
commended.
37. He urged Argentina to notify its trade measures to the WTO.  He expressed doubt on whether an
ultimate balanced outcome of the Uruguay Round was to be achieved through the launching of a broad
and comprehensive programme of negotiations;  mandated negotiations should not be held hostage to
other decisions.
38. The representative of Brazil commended the coherence of Argentina's policies and indicated the
significance of its bilateral economic relations with his country.  Both countries shared the same strategic
vision.
39. The representative of Costa Rica raised questions on the exchange rate aspects of the
Convertibility Plan; these related to its impact on prices of tradeable and non-tradeable goods, production
and consumption patterns as well as prospects for the Argentine currency after the devaluation of theWT/TPR/M/47
Page 11
Brazilian currency.  He wondered whether unemployment was a transitional phenomenon and if this
could be corrected without any policy intervention.  He asked about the existence of any assistance or
insurance programmes against unemployment.  What were the policies and incentives for foreign
investment, including those granted under the Fundación Invert-Ar ? More information was requested on
the Special Customs Areas operated by Argentina.
40. He asked whether sectoral measures on sugar, clothing and footwear were vital to the sectors'
subsistence and competitiveness, as well as on any alte rnatives to a future tariff reduction exercise in the
auspices of the WTO.  Had there been a higher leve l of private sector participation in sanitary- and
phytosanitary-related services?  What had been the incidence of the National Meat and Grains Boards in
terms of policy formulation, net transfers to the private sector and improvement of health-related
activities?  He asked about the type of protection available to patents on new varieties of plants.
41. The representative of Czech Republic referred to his country's increasingly close bilateral trade
relations with Argentina, whose exports enjoyed largely the GSP treatment granted by his country.
Macroeconomic stability was to assist Argentina in coping with monetary developments in Brazil.  Trade
openness was reflected in considerable export and impor t growth.  He was interested in knowing whether
the increased recourse to anti-dumping action was proportional to the degree of liberalization.  What were
the steps taken to ease imports of completely-built-up vehicles? He also asked about any proposed
changes to be brought by the Common Automotive Regime of MERCOSUR by the year 2000?
42. The representative of Morocco appreciated Argentina's macroeconomic performance despite the
global financial crisis.  She noted that delays in the privatization process in banking and airports.
Assistance in agriculture and fisheries was being re duced.  Argentina maintained several co-operation
agreements (e.g. food, fisheries, energy, mining, and tourism) and a seemingly permanent trade surplus
with her country.  She recalled that trade union issues were not to be raised in the Trade Policy ReviewBody and that no replies were required on this matter.
43. The representative of Switzerland raised questions on the impact of the slow-down of the world
economy on the Argentine trade balance and domestic demand.  He asked about the prospects for, and
type of response by Argentina to the recent devel opments in Brazil.  Was there any possibility for a
reversal of the trade liberalization trend?  His delegation expressed the wish that Argentina and itsMERCOSUR partners abstain from distorting internatio nal trade flows and discriminating among trading
partners.
44. He welcomed Argentina's trade policy reforms;  further progress was expected in patents and
copyright protection as well as competition policy.  Was there evidence that Argentine exports were
subject to anti-dumping measures?  He asked about action to be adopted for improving the timely
communication of trade measures to the WTO.
45. The representative of Turkey highlighted aspects of Argentina's macroeconomic achievements
and emphasized that the MERCOSUR membership  contributed to its political stability.
46. The representative of Mexico raised questions on several features and the effects of the operation
of a PSI regime as well as on planned changes in product coverage.WT/TPR/M/47
Page 12
VI. REPLIES BY THE REPRESENTATIVE OF ARGENTINA AND ADDITIONAL
COMMENTS
(i) The economic environment
47. In response the representative of Argentina stated that the number and complexity of questions
reflected great interest about his country's economy.  He confirmed his Government's intention to
continue working on the 1990 policy principles, based on an open economy and increasedcompetitiveness.  Despite the global financial crisis , in 1998 GDP growth had attained 4.9% and inflation
stood at 1%;  the public sector deficit represented 1.1% of GDP.
48. In 1999, Argentina's priorities covered: the strengthening of macroeconomic, fiscal and external
finance disciplines; work on the social effects/implications (e.g. health, education) of economic policies;
and, the improvement of the external competitiveness of the economy.  To reduce risks from fluctuations
or crises in the world capital markets, in 1999, the fiscal deficit and payment obligations were to be the
financed through domestic bonds; plans for coping with exchange and interest rates risks were alsomentioned.  A first major step was the reduction of tariff rates on capital goods not produced in
MERCOSUR from 14% to 6% as from 21 January 1999; this was inter alia  aimed at promoting and
diversify exports.  This was also important in dealin g with the financial crisis, which would be handled in
a WTO-consistent manner.  Argentina attached particular importance to future multilateral trade
negotiations with a view of stabilizing market access conditions.
49. The investment legislation guaranteed national treatment to foreign investors; the Fundación
Invert-Ar  did not provide direct incentives to investors.  The establishment of foreign-owned transport
firms was subject to certain requirements.  Concerni ng the investment regime for mining, clarifications
were made on the taxes subject to fiscal-stability guarantees as well on the fuel-related tax incentives,
which in practice were not applicable.
50. MERCOSUR was important for Argentina's integration to the world economy and constituted the
forum for addressing trade-related difficulties from the Brazil crisis; no reversal of the group's internal
liberalization process was envisaged.  MERCOSUR's commitment to open regionalism was reflected in
its non-distortive and non-protectionist policies that intended to extend regional benefits at multilateral
level. For a number of reasons, MERCOSUR's comp atibility with WTO rules was supported by the
absence of any trade distortive effects in the region; both the intra- and extra-zone trade had grown, and
the group had attracted investment of any origin.  When referring to MERCOSUR's agreements and
negotiations with other trading entities, he stated that exceptions or longer liberalization timetables to the
product coverage of certain agreements were compatible with WTO provisions.  The basic features of
MERCOSUR's internal trade liberalization, convergen ce to the CET and average tariff levels by the
year 2005 were cited; there was no intention to delay the internal liberalization process.
51. Concerning the decline of alumina imports from Australia (Annexes I and II), an analysis taking
into account MERCOSUR's trade with Australia on this product was required.
52. The second discussant was pleased with Argentina's determination to proceed within the reform
and opening approach, avoid protectionist reaction, reduce tariffs on capital goods and use MERCOSUR
for consolidating its reforms.  It was now rather clear that MERCOSUR was the main driving force of
Argentina's trade policy; however, there was concern a bout the implications of preferential access, MFN
tariff detours and third country interests, over WTO objectives.  What constraints were imposed by
MERCOSUR on Argentina's WTO trade liberalization objectives (including future negotiations)?  He
sought comments on the interaction between fiscal and trade policy.WT/TPR/M/47
Page 13
53. The first discussant noted that action against unemployment had been taken.  Unemployment, a
side-effect of Argentina's positive reforms, was a problem common to all countries undertaking structural
reforms regardless of their developmental level.  He expressed hope that, in the future, the side-effects of
positive measures were to be discussed at the WTO.
54. In reply the representative of Argentina said  that since 1991 MERCOSUR had eased integration
of its members to world trade in a WTO consistent manner; this was reflected in the implementation of
their regional and multilateral commitments, as well as  in the participation in negotiations, including
those undertaken with other partners and regional entities.
55. Concerning the interaction between fiscal and trade policy, the increase in trade-related fiscal
revenue reflected import growth.  In the first ten months of 1998, the average effective tariff rate (defined
as the share of tariff-related revenue to total imports) stood at 8%; total imports included those benefiting
from duty free or other preferential treatment in the context of the MERCOSUR and LAIA agreements.
56. Unemployment had dropped significantly but it remained relatively high; employment was to be
further increased by raising investment and diversifying exports.  Argentina considered that
unemployment could be caused inter alia  by unfair trade practices.  In this connection, he pointed out that
in the past four years, 50% of anti-dumping cases had been terminated without the adoption of measures;
this type of WTO consistent measures affected 1.5% of total imports.
57. The representative of Australia asked when and by whom the analysis on the alumina trade
involving his country was to be conducted.  Were the results to be made public?
58. The representative of Japan welcomed Argentina's commitment for keeping its market open and
took note of the confirmation of MERCOSUR's WT O consistency.  However, he recalled that
MERCOSUR should not raise trade-distorting barrie rs and had to be in conformity with the
WTO provisions.  Tariffs applied by Argentina on certain items exceeded their CET levels.  He said that,although the rapid increase of footwear imports was due to those originated in MERCOSUR, safeguards
were applied on imports from third countries.
59. The representative of the European Union noted that Argentina's opening and regional integration
prevailed over trade policy considerations.  Argentine trade policy had benefited WTO members by
allowing entry of their industries in the market.  Progress had eliminated losses from the delay caused bythe "lost decade" of the 1980s.  MERCOSUR had beco me attractive to other Latin American countries.
He praised the tariff reduction on capital goods not produced in MERCOSUR, as well as the collective
MERCOSUR monitoring of the global financial crisis.  In this context it was important to preserve market
openness in a reciprocal manner.
60. The representative of the United States was also pleased with Argentina's decisions to maintain
its market open despite the current financial situation, as well as to reduce tariff rates on capital goods not
produced in MERCOSUR.  He requested explanations  on the definition of the term "capital goods".
Were information technology products covered?
61. In response, the representative of Argentina clarified that the analysis with respect to the alumina
case was to be carried out on a bilateral basis with Australia.  MERCOSUR had a political stability value
and an incidence on its members' strategy towards th e strengthening of the multilateral trading system.
Issues dealt within MERCOSUR contributed to its re inforcement; past macroeconomic disparities among
its members had been tackled within the group.  Details on the definition of the term "capital goods" wereWT/TPR/M/47
Page 14
to be communicated soon by submitting to the WTO relevant legal texts concerning the tariff reduction.
Capital goods represented 40% of Argentina's imports from developed countries.
(ii) Trade measures
62. The representative of Argentina clarified the background of the single foreign trade law, which
had never been enacted entirely nor applied in practice; there was no intention to engage again in the
preparation of such a text.  WTO notification requirements formed part of Argentina's undertakings andwere indispensable for meeting transparency objectives; this was periodically recalled to agencies
concerned.  Argentina had supplied information to the Integrated DataBase and was to meet deadlines
for 1999.  The electronic version of its Loose Leaf-Schedule was under preparation and technical
assistance had been requested to the WTO Secretariat.
63. Origin certification requirements observed the relevant WTO provisions and those that related to
textiles, clothing and footwear did not constitute a trade barrier.  Argentina examined ways to implement
the provisions on origin assessment.
64. Argentina's PSI regime was a temporary, WTO-consistent measure; its recent amendment had
been notified.  Out of 100,000 inspection certificates, about a hundred had led to complaints, mainly due
to lack of information; there had been no complaints about delays.  WTO-consistent price bands or ranges
had been introduced prior to the PSI regime with a vi ew to allowing comparison of the declared customs
value.  He also explained the legislative, institutional and operational changes that had been introduced toimprove the functioning of the Customs as well as of tax collection.  He made a detailed description of the
objectives and regulatory aspects of the PSI regime.  Portuary services were run by private firms whose
container handling fees were not subject to government decisions.
65. The three-percentage points tariff increase was temporary and the resulting duty levels stood
below bound rates, except for a few items subject to GATT Article XXIV:6 negotiations.  TheMERCOSUR integration process had affected trade in certain product categories only; no tariffs affected
goods of MERCOSUR origin as from January 1999.  C onvergence to the CET, which according to the
authorities had not to be modified, was under way as scheduled; there were no exceptions to the CET
other than those cited at the WTO Secretariat report.  Argentina's Schedule LXIX (HS96) had not yet
been accepted by all Members.
66. He noted that recourse to anti-dumping measures had increased in parallel with the degree of
openness of the economy.  Common MERCOSUR regulations on safeguards, anti-dumping and
countervailing measures applied against imports from third countries; the revision of these regulations
was to conclude before the end of the year 2000.  Argentina's implementing legislation had been adjusted
to WTO rules and practices.  He explained institutional and procedural developments that had been
notified to the WTO.  Deadlines for different stages of the investigation process had been shortened; the
18-month maximum time limit for concluding the process had been observed.  The early elimination of ameasure depended inter alia  on import-related developments.  He provided up-to-date information on
specific cases of interest to the EU.
67. Safeguards on footwear were subject to panel examination in the context of the WTO Dispute
Settlement Mechanism; at this stage, discussion on this issue was not appropriate.  The implementation of
DIEMs on toys was under consideration; if introduced, these duties were not to exceed the binding andCET rate levels.
68. Institutional measures had been taken recently to avoid a return of foot-and-mouth-disease.
Argentina intended to sign SPS (Sanitary and Phytosanitary Measures)-consistent agreements of MutualWT/TPR/M/47
Page 15
Understanding with its major trading partners; several co-operation agreements had already been signed
with countries from the region.  Origin marking was required to encourage trade and avoid uncertainty.
69. Concerning government procurement, participation requirements for bidding and for preference
to domestic suppliers were approximately the same as those of other countries with similar level of
development.  He highlighted Argentina's regulatory framework on and participation in different
international fora dealing with government procurement.
70. He added that a notification on export subsidies had been submitted recently to the WTO.  The
drawback regime did not contain fiscal incentives; those on capital goods and on items under the
Industrial Specialization Regime had been eliminated in 1996.  The tax rebates scheme on exports of
turnkey plants did not contain any selective or mandatory benefit that had been prohibited under
WTO provisions.
71. He provided extensive information on progress in the work undertaken at national and
MERCOSUR level in all the areas of protection of intellectual property rights (including for new plantvarieties) as well as with respect to compliance with provisions of the Agreement on TRIPs.  No
compulsory registration requirements had applied on technology transfer to Argentina since 1981; on the
contrary, voluntary registration allowed for fiscal bene fits.  On competition policy, he explained the status
of congressional discussions on a bill that was to inter alia  address issues like the control of
concentrations and mergers, as well as appeals and sanctions.
72. The second discussant expressed his appreciation on the extensive explanations and looked
forward to reading the written statement on replie s to questions (Annex II).  The representatives of
Australia , Canada , the European Union , India , and the United States , joined the second discussant on this
request; the text of the statement was to facilitate proper assessment of the replies
73. The representative of the United States noted the considerable volume of Argentina's replies and
suggested that efforts had to be made for reconsid ering the grouping of themes for discussion in the
TPRB.  He reiterated his delegation's questions on safeguards.
74. The representative of the European Union appreciated the temporary nature of the 3 percentage
point tariff increase, which was of particular concern to his delegation.  He urged the authorities to avoid
reflecting PSI costs on importers or exporters.  He sought comments on the countervailing duties affectingolive oil and canned peaches imports from the EU.  The protection of patents (and their confidentiality)
for chemicals and pharmaceuticals as well as that of trademarks were other important issues for his
delegation.
75. The representative of Canada encouraged Argentina in its efforts to harmonize its Customs
service and for making sure that the PSI regime remained a temporary measure.
76. The representative of Japan appreciated Argentina's efforts to strengthen the framework of
competition policy, and encouraged a prompt passing and enforcement of new legislation.  He reminded
Argentina that all local content requirements had to be eliminated as scheduled under WTO TRIMs
commitments; in this respect, he again encouraged replies to questions submitted at the relevant WTO
Committee from the United States.  The temporary CET increase was against the spirit of
GATT Article XXIV provisions.  Anti-dumping measures  were an exception to the WTO principles and
this was a consideration to be taken into account before invoking them.  He shared the view of theWT/TPR/M/47
Page 16
United States on the procedure for discussing matters in a Review, and said that this issue had to be dealt
at the 1999 Review Process of the Trade Policy Review Mechanism.
77. In response, the representative of Argentina stated that the late submission of advance questions
was partly the reason for not providing full replies during the meeting.  He reiterated that on anti-dumping
and countervailing measures, as well as safeguards, Argentina would abide with WTO rules and domestic
legislation.  He had no intention of providing details on cases under examination in the WTO and/orArgentine competent agencies.  Safeguards on fo otwear met implicitly or explicitly WTO rules.
Concerning safeguards on toys, no injury or threat thereof had been found and DIEMs had not been
approved yet; however, if any DIEMs on certain ty pes of toys (meeting MEOSP's criteria for DIEMs
application) were to be adopted, these were not to exceed the ad valorem  equivalent of
MERCOSUR CET rates and WTO bindings.  The MERCOSUR CET was in conformity with
GATT Article XXIV provisions.  There was no evidence that the operation of the PSI regime had caused
additional delays and costs on foreign trade procedures; additionally, increased imports (mainly capitalgoods) from the EU, which seemed concerned with the effects of the PSI régime, proved that there had
been no impact on trade flows.
(iii) Policy and measure by sector
78. In the light of time constraints, the Chairman suggested a brief response on this theme; the text of
the entire statement (Annex II) was to be made available at the end of the meeting.
79. The representative of Argentina stated that no sectoral policies were applied, except for the
automotive sector.  The guidelines for the adopt ion of a MERCOSUR Common Automotive Regime were
contained in his written statement; it was to enter into force as scheduled.  He concluded by reiterating
that no overall policy changes were envisaged;  the 1990s policies had allowed Argentina to overcome
external shocks such as the impact of the Mexi can crisis.  MERCOSUR was the most practical and
efficient means for the strengthening of its members' integration to the world economy.
80. The representative of Japan recognized the usefulness of the TPRB meeting on Argentina but
regretted the lack of discussion on important sectoral matters.  This development, which was partly due to
the late start of the meeting (another issue for the 1999 Review process), had not to be taken as a
precedent for future Trade Policy reviews.
81. In response the representative of Argentina expressed his willingness to continue the meeting,
but, as emphasized by the Chair, written replies were available.
82. The representative of the European Union underlined the substantial investment and export
interests of his delegation with respect to the automotive sector in MERCOSUR.  Recent developments
and further progress in MERCOSUR work relating to the sector were closely monitored by his
delegation.  He expressed the hope that there would be a WTO consistent outcome.WT/TPR/M/47
Page 17
VII. CONCLUDING REMARKS BY THE CHAIRPERSON
83. The second Trade Policy Review of Argentina was conducted by the TPR Body on 20 and
22 January 1999.  These remarks, prepared on my own responsibility, are intended to summarize the main
points of the discussion; they are not intended as a full report.  Further details of the discussion will be
fully reflected in the minutes.
84. The discussion developed under three main themes:  (i) economic environment;  (ii) trade
measures; and (iii) policies and measures by sector.
(i) Economic environment
85. Members praised Argentina's economic performance since the last Review, due to
macroeconomic discipline, and wide-ranging struct ural adjustment, under the Convertibility Plan.
GDP per capita had doubled, inflation drastically reduced and Argentina had become a major FDI
destination, although unemployment remained high.  In tribute to its sound fundamentals, Argentina had
weathered well the Asian financial crisis.  With Brazil the major export destination, there were questionsabout the effect of the recent depreciation of the Brazilian Real, particularly with respect to the currency
board, the external accounts and further liberalization of the MERCOSUR market.
86. Participants welcomed Argentina's active participation in, and support of the WTO and
recognized the importance of the MERCOSUR proce ss.  Questions were asked on the nexus between
multilateral and regional trade objectives, trade diversion and progress on common régimes for sugar andautomobiles.
87. In reply, the representative of Argentina expressed confidence in the soundness of the
Argentinian economy and in its ability to deal with the potential effects of the recent economic evolution
in Brazil, which would be handled within MERCOSUR and in a manner fully consistent with the WTO.
Unemployment was down to around 12% and continued prudent fiscal and debt management, improvedlevels of investment, and economic and export diversification should contribute to lower rates; in this
context, tariffs on imports of capital goods from non-MERCOSUR sources had yesterday been lowered
from 14 to 6%.
88. He noted that MERCOSUR was built on the principle of open regionalism, and was consistent
with the process of multilateral liberalization, which was actively promoted.  No visible trade distortionshad emerged and both intra- and extra-regional trade had grown rapidly; this also reflected the profound
structural reform by the regional partners in recent years.  On 1 January 2006, the CET would cover all
tariff lines; tariffs now affected only a minimal volume of intra-regional trade.  MERCOSUR aimed to
establish a common market by 2005, including the free movement of production factors and the
harmonization of national standards.
(ii) Trade measures
89. Members warmly commended Argentina's trade refo rms, making it a considerably more outward-
oriented, secure market.  The tariff was bound and ceiling rates had been considerably reduced; progress
was clear in the reduction of non-tariff measures; and trade procedures had been simplified.  Timely
notification of measures to the WTO was encouraged.  Questions arose on a number of issues including,
preshipment inspection, price bands for customs purposes, non-preferential rules of origin, the temporary
3 percentage point tariff increase, the implementation of anti-dumping, countervailing and safeguardWT/TPR/M/47
Page 18
actions, fiscally-driven production and trade measures, and plans to eliminate Argentina's two remaining
export assistance schemes.
90. Noting the importance of the procurement market, some Members encouraged Argentina to
accede to the Government Procurement Agreement and asked, in particular, about contract procedures
and the participation of foreign firms.  Efforts for harmonizing standards within MERCOSUR attracted
attention, as did matters such as certification arrangements and mutual recognition agreements.  Therewere also inquiries about the legal framework for competition policy.  On intellectual property rights, a
number of Members expressed interest in the es tablishment of a common regime for MERCOSUR and
questions were raised in several areas including patents, copyrights and enforcement.
91. In response, the representative said that Argentina attached great importance to its WTO
notifications requirements and the relevant authorities were periodically reminded of those obligations.
Pre-shipment inspection aimed to deal with a numb er of issues including tax evasion, unfair trade
practices, and improved compliance with standards; the system was temporary.  Origin certificates wereused mainly for products subject to trade defence measures.  Price bands for customs allowed price
comparisons for goods from different sources.
92. The 3 percentage points increase in the CET would be phased out on 31 December 2000.  For a
small number of products bound rates had been exceeded and the list had been submitted to the WTO for
negotiations.  The number of antidumping measures had increased only relative to the limited measures inforce under the earlier less open import regime.  Recent investigations had not exceeded the 18 months
time limit.  A common MERCOSUR anti-dumping regime  would be considered before the end 2000.
Argentina had notified its export incentive regimes in 1998: benefits under the Industrial Specialization
Regime, which had been suspended in 1996, would end on 31 December 1999.
93. On government procurement, Argentina was an observer to the GPA but had no plans to accede
to the Agreement; it took part in regional initiatives within MERCOSUR and the FTAA. Aspects of
Argentinian procurement were explained.  Argentina sought to improve international cooperation in the
area of sanitary and phytosanitary measures, having signed bilateral agreements with a number of
partners.  New competition statutes had been submitted to Congress in late 1998, amending and
expanding the existing legislation.
94. On intellectual property, patents submitted after 1 January 1995 were granted 20 years protection;
problems were being handled by the judicial system.  Protection to software had been granted in 1998
under copyright legislation.  Details were given on the link between marketing permits and patents,
exclusive marketing rights, the Confidentiality Law, and the protection of vegetable varieties.
MERCOSUR was working on various regional protocols fo r the protection of intellectual property rights.
(iii) Policies and measures by sector
95. Members welcomed the fact that Argentina's trade policies were largely free of distortive
elements and that resource allocation was mainly market driven.  In this context, Argentina was asked
about its sectoral trade policy objectives.  The health, viability and efficiency of Argentine agriculture
was noted as was the suggestion that further multilateral trade liberalization would improve sectoral
prospects.  Improvements in Argentina's meeting of international sanitary requirements, opening export
markets for beef, were recognized.  Questions arose on variable import levies on sugar, price support fortobacco, and export taxes on oilseeds, hides and skins.  In manufacturing, the automobile sector came
under some question, especially with respect to local-content requirements.  There were also queries
about protection for toys, textiles and clothing and particularly for footwear.  Argentina was encouraged
to participate in the Information Technology Agreement.WT/TPR/M/47
Page 19
96. Members recognized and welcomed the openness of Argentina's services sector.  Information was
requested on privatization in banking and on criteria for FDI in financial services.  In
telecommunications, the implementation by November 2000 of liberalization commitments in basic
services was noted, and questions arose about m obile telephone services and personal communication
systems.  Maritime and air services were of particular interest to some Members, including cargo-sharing
and rights for the national carrier, respectively.  Information was sought on Argentina's MFN exemptionsunder GATS and on MERCOSUR negotiations in services.
97. In reply, the representative said that Argentina did not implement sectoral policies except for
automobiles.  He explained the operation of the import levy on sugar and noted that the export tax on
oilseeds compensated for tariff escalation on downstream products; he confirmed that export taxes were
applied on hides and skins.  On the automobiles, he noted that the 1996 changes to its regime had been
notified to the TRIMs Committee; the regime was transitory and would be replaced by a common
MERCOSUR policy in 2000, entailing free intra-MERCOS UR trade, and common external tariffs and
export promotion policies.  Footwear measures were subject to dispute settlement, and any provision on
toys would meet WTO provisions.
98. In financial services, a regulation restricting market access in the insurance sector had been
eliminated in October 1998; however, Argentina was not envisaging to modify its WTO schedule of
commitments.  The liberalization of basic telecommunication services was proceeding according toschedule; Argentina complied with its specific commitments on mobile telephones.  There were no
restrictions on the supply of maritime transport services but Argentina had bilateral maritime agreements
containing cargo-sharing provisi ons.  Under MERCOSUR, negotiations had begun to define sector-
specific commitments.
Conclusions
99. In conclusion, it is my feeling that this Body welcomed Argentina's robust macroeconomic
performance and structural reforms, including sustaine d trade liberalization efforts; not only has GDP per
capita increased sharply but sound fundamentals have allowed Argentina to cope well with a series of
external shocks.  This bodes well for Argentina's capacity to deal with the recent depreciation of the
Brazilian Real.  It is my feeling that delegations appreciate Argentina's involvement in and commitmentto the multilateral trading system, and look forward to Argentina's constructive role in the preparatory
process for the upcoming negotiations.  Members encouraged Argentina to pursue the liberalization of its
economy, based on WTO principles and thus take steps to address allocative distortions, including in
sensitive manufacturing sectors.  It is also my sense that Members saw the importance for further trade
liberalization within MERCOSUR to contribute to th e strengthening of the multilateral trading system.WT/TPR/M/47
Page 20
ANNEX I
ADVANCE WRITTEN QUESTIONS
QUESTIONS BY DR. NOTIS (FIRST DISCUSSANT)
(1) Macroeconomic situation:  financial crisis; contagion; trade and current accounts;
macroeconomic adjustments; fiscal account s (tariffs), unemployment and labour market
flexibility; fiscal exchange rate; competitiveness; debt; privatization
I would like to begin by mentioning that Argentina is a country that has known positive economic
development overall during the last decade.  However, the process has had a considerable economic cost
according to the Secretariat’s Report.  Unemployment has become a serious concern in recent years.
Would the Argentine Delegation please comment on and explain these developments in greater detail.
I would also ask the Argentine Delegation to comment on the subject of concentration of the
economy and whether it sees any relationship between this movement toward concentration and the
increase in the unemployment and poverty rates mentioned earlier.
What do the authorities intend to do about the problem of the fiscal deficit?
Could the Argentine Delegation present us with th eir evaluation, if possible, of the new prospects
after the devaluation of the Brazilian currency?
According to the information in the Secretariat’s Report, the elimination of imperfections in the
financial and labour markets and the diversification of exports could reduce the risks.  Could theArgentine delegation please comment on this suggestion?  Last, we would be very interested in having the
Argentine delegation present its views on the more general issue of the sensitivity of the trade and
commercial account balances.
(2) Single foreign trade law; notification; IDB
Although Argentina complies with most of the regular WTO notification requirements,
transparency would be improved at the international level if WTO were informed more promptly about
the introduction or modification of trade measures.  I would ask the Argentine Delegation to provide us
with a bit more information on these points.
(3) Tariffs:  stability;  3 percentage points te mporary increase;  bindings; HS96;  exceptions to
CET;  rates on capital goods
First of all, I would like to point out that tariffs bound at a maximum of 35% are generally higher
than the tariffs actually applied.  I therefore have a general question relating to the future (page 48,
paragraph 2).  Since Argentina supports a broad and full process of negotiations in 2000, I would like to
know whether the authorities plan in future to bind ta riffs at a lower level, for example to the CET levels
of MERCOSUR.
My second question is related to the application of higher duties on most capital goods.  In
March 1995, Argentina raised the tariffs on most capital goods and on computer and telecommunicationsequipment to contribute, among other things, to counteracting the fiscal deficit (page 53, paragraph 21).
Don’t you think that measures of this type could have an adverse effect on investment and industrial
production?WT/TPR/M/47
Page 21
(4) Export subsidies, export insurance/guarantees, export taxes
Argentina applies two export assistance programs th at have been notified to the WTO.  The first
is exports of industrial plants and engineering projects under turnkey contracts.  The second program
bears on the ports in Patagonia.  With respect to this program, the authorities are considering an
alternative development program for Patagonia falling under the category of non-actionable subsidies that
will permit the current system to be phased out at a faster pace, in line with the WTO provisions(page 94-95, paragraph 126-128).  I would like to ask what progress has been made in this alternative
program.  I would also like to know whether someth ing similar is being considered for the first program,
which is similar to a TRIM, although it partly concerns a service activity.
Last I would like to refer to government tariff concessions.  Since 1991, a drawback has applied
that permits the partial or full refund of import duties and the statistical tax on inputs used to manufacture
export products, as well as the VAT and excise taxes paid at different processing stages.  According to the
authorities, this system is not considered to be an export subsidy, which is why WTO was not notified.I would appreciate your comments on this.
(5) Agriculture:  net transfers;  National Grain Board;  sugar, variable levies;  tobacco;  fisheries;
forestry
Since 1992 variable levies have been applied to  sugar of any origin, including MERCOSUR, in
addition to the prevailing ad valorem  tariff (see page 65, paragraph 45 for more details).  I would like to
know if this trade practice is consistent with Article 4 of the Agreement on Agriculture and if it has been
notified to WTO.
(6) Manufacturing: higher rates on some final goods-specific minimum duties;  automobiles;
tariffs, local content (TRIMs), MERCOSUR;  textiles, clothing, footwear
Could the Argentine Delegation provide us with a bi t more information on the nature of this trade
measure (minimum specific duties on textiles) and on whether Argentina intends to continue applying it?
The minimum specific duties applied to textiles and clothing, after several adjustments, should
have been gradually reduced between June 1997 and April 1998 (page 144, paragraph 108).  The
Secretariat informs us in its Addendum that these duties will continue to be applied until the end of
March 2000.  Would you like to comment on this?  I would also like to ask what your future intentionsare.
(7) Transport (air, land and maritime)
In the services sectors, Argentina assumed very broad commitments under the General
Agreement on Trade in Services.  I cannot resist the temptation of asking why agreements for equal
cargo-sharing of bilateral trade continue to exist?  Perhaps it would be better to ask what Argentina’s
intentions are with respect to future negotiations.WT/TPR/M/47
Page 22
QUESTIONS BY AMBASSADOR FARRELL (SECOND DISCUSSANT)
(1) Financing from international organisations
(Components of Trade Policy Strategy) What I would welcome is a more explicit indication of
how the various strands are seen, by Argentina, as knitting together. Which are the main driving forces
behind the trade policy strategy?  The unilateral push was clearly a decisive one as part of the radical
domestic economic reform programme.  Have sub-regional economic imperatives overtaken unilateralones?  We are told that MERCOSUR is seen by Argentin a as “... a platform for connecting to the rest of
the world”.  How is this perspective and the MERCOSUR priority going to shape Argentina’s approach to
setting its multilateral trade liberalisation objectives?
Also, based on an economic history well known to me, I wonder, does a vision of an ideal trade
diversification pattern play a part in Argentina’s trade policy strategy formulation?
(Dialogue with the Private Sector) I wonder ho w the new Private Sector Advisory Council on
Foreign Trade operates and how it is working out?  And how has the response of the business community
been to the new Registry of Barriers to Argentine Exports?
(2) Agriculture:  net transfers;  National Grain Board;  sugar, variable levies;  tobacco;  fisheries;
forestry
(The Automotive Sector) With its strong and admirably demonstrated belief in economic reform
and liberalisation, how does Argentina see its own automotive sector evolving over the years ahead?  Canand indeed should the economy sustain the level of protection afforded this sector?  Can a common
MERCOSUR regime be constructed to commence in 2000 which promotes transition to greater efficiency
and to international competitiveness, rather than  risks entrenching apparent resource allocation
distortions?
(Agriculture Strategy) I would appreciate hear ing more about how Argentina assesses its own
performance against these objectives, and then about changes which may be seen as necessary in the
composition and weighting of Argentina’s existing agricultural strategy objectives in the light of
experience and of Argentina’s assessment of the future production and market environment for
agricultural products.
(3) Telecommunications services
(Telecommunications and Aviation) I wonder howev er about the consistency of this open and
competitive approach to a key future technology sector on the one hand, and on the other, the trade policy
adopted in 1995 in relation to the imposition of tariffs on informatics and telecommunications products,
together with the decision by Argentina not to pa rticipate in the International Technology Agreement?
This raises the broader question of whether there is an overall trade and development strategy
relating to telecommunications and information technology?  Perhaps comments on this could be shared
with us.
Given the potential it holds for increasing air-cargo frequency and carrying capacity for items
such as fresh produce and high-tech parts and spares, perhaps an interesting policy question on this front
is whether Argentina will be looking at the advantages of pursuing an “open skies” policy?WT/TPR/M/47
Page 23
QUESTIONS BY AUSTRALIA
Argentina has made impressive progress in the establishment of investment laws attractive for
foreign direct investment.  However, there are a number of issues of concern to Australian companies.
The Provinces do not always abide by or interpret the Federal Laws consistently, thus imposing
additional burdens on foreign investors not envisaged in the feasibility stages.  What steps, if any, is the
Argentine Government taking to minimize these discrepancies?
Under the guaranteed fiscal regime provided  under the Mining Investment Law (Act 24196),
considerable foreign investment has already taken place.
- Does the new legislation proposed under the Tax Reform Bill now before the Congress
prejudice in any way foreign investments already in place by imposing new taxation
burdens not envisaged under the Fiscal Stability Regime of Act 24196, particularly the
imposition of withholding tax payable on interest on foreign loans and withholding tax on
dividends payable to foreign investors?
- Does the imposition of new diesel fuel tax for the mine industry impose new burdens not
envisaged under the Fiscal Stability Regime under Act 24196?
- Does the application of accelerated depreciation provision in Act 24196 limited to the
first five years only, prejudice investments with large initial capital inputs, for example
mining investments, not earning profits in the first five years?
Can Argentina outline its policies in relation to foreign participation in infrastructure projects.
Do foreign companies participating in infrastruc ture development receive national treatment in
Argentina?
Does Argentina have any foreign investment restrictions in relation to land transport, civil
aviation or maritime transport services, and if so can Argentina advise whether there are plans toliberalise those restrictions?
We would like Argentina to comment on the relationship between its regional and multilateral
arrangements, with particular emphasis on Mercos ur's performance so far, the FTAA and possible
EU-MERCOSUR negotiations.
(a) Is the possibility that Argentina may concede further preferential access to regional
partners for agriculture consistent with the multilateral trade liberalization Argentina has
been proposing?
(b) We are aware of the arguments presented by MERCOSUR countries that MERCOSUR
does not divert trade but enhances trade.  Would Argentina be able to comment on a
specific issue of concern to Australia – Australia used to export to Argentina alumina
valued at more than AUD$100 million annually.  Australia lost most of this market after
the formation of MERCOSUR when Argentina began to source its alumina from Brazilunder preferential arrangements under MERCOSUR.
(c) Will the world financial crisis have an effect on the elimination of tariff protection on
imports of sensitive items, now excluded from MERCOSUR's Common External Tariff,
as originally scheduled to be eliminated by the end of 1998?WT/TPR/M/47
Page 24
(d) As a result of the crisis, several industrial sectors have been lobbying to raise the
MERCOSUR's Common External Tariff (CET), as well as duties on sensitive items.
What is Argentina's position on this proposal?
(e) What progress has been made in the establishment of common regimes for sugar and
automobiles in Mercosur?
We understand that the National Foreign Trade Commission was formed to oversee cheap
imports entering Argentina as a result of recent substantial devaluation of currencies in the Asian region.
Would Argentina please provide a brief review of the National Foreign Trade Commission's performance
so far, and the Government's plans, announced on 9 October 1998, to accelerate investigations for
safeguards and countervailing duties?
What is Argentina's trade policy regarding electronic commerce?  We understand that no legal
framework has yet been established, and we wish to know if Argentina will impose tariffs on international
electronic commerce.
QUESTIONS BY CANADA
Secretariat Report (WT/TPR/S/47)
On Customs Procedures
As noted in Chapter III, section 2, subsection (i), Argentina has made significant steps towards
simplifying and speeding up customs procedures.  What further steps is Argentina planing tomodernize/improve further its customs and importation procedures in order to facilitate trade?  For
example, what is Argentina's view of the following approaches for facilitating and expediting the
cross-border movement and early release of goods from  customs:  moving from transaction-based control
procedures to audit-based and risk-assessment-based controls; pre-arrival processing of import
documentation and related matters; post-entry duty and tax collection and acceptance of paymentguarantees, such as bonds instead of deposits; and advanced rulings on tariff classification and applicable
duties and taxes.  Are any of these approaches included in the legislation that is being developed on
custom clearance referred to in Chapter II, section 5, paragraph 30?
On WTO Notification Requirements
Chapter II, section 5 (Trade Laws and Regulations), paragraph 32 states that "While Argentina
has met most of the regular WTO notification requirements. transparency would be improved at the
international level through prompter communication to the WTO of the introduction or modification of
trade measures".  What steps is Argentina taking to improve communication with the WTO?
On Certificates of Origin
As the WTO Secretariat Report points out in Chap ter III, section 2, sub-section (i) (Registration
and documentation requirements), paragraph 12, delays and cost increases in importing are being caused
by the certificate of origin requirement.  Does Argentina plan to make modifications to the requirement toaddress these problems?
How does Argentina view the compatibility of its certificate of origin requirement with the
objective of facilitating trade by minimizing the incidence and complexity of import formalities and
decreasing and simplifying import documentation requirements?WT/TPR/M/47
Page 25
On Non-Preferential Rules of Origin
As noted in Chapter Ill, section 2, sub-section (ii) (Tariffs), paragraph 30, Argentina maintains
non-preferential rules of origin.  For what purposes  are these non-preferential rules of origin used?
Article 2(h) of the WTO Agreement on Rules of Origin provides for advanced assessments or
rulings on non-preferential rules of origin.  Can Argentina confirm that it provides such advanced rulings
upon the request of an exporter, importer, or any person with a justifiable cause and that such assessmentsor rulings remain valid for three years provided that  the facts and conditions under which they have been
made remain comparable?
On Preshipment inspection
With reference to Chapter III, section 2, sub-section (iii) (Customs valuation and preshipment
inspection), paragraphs 42 and 43, what criteria are being used to determine the termination date of the
temporary measure of preshipment inspection?
Can Argentina provide an estimate as to when the temporary measure will be terminated?Canadian companies have reported that the minimum value of merchandise affected by the
preshipment inspection has been lowered from US$3,000 to US$800.  Can Argentina confirm this
modification and whether this has been communicated to the WTO?
On Government procurement
As noted in Chapter III, section 2, sub-secti on (xii) (Government procurement), paragraph 92,
Argentina has been an observer in the WTO Committee on Government Procurement since April 1997,
"with a view to deciding on its eventual accession to the Agreement".  Can Argentina give an indication
of any steps it is taking to prepare for accession to the Agreement and when it might join this Agreement?
On Anti-dumping and countervailing measures
Chapter III, section 2, sub-s ection (xiv) (Anti-dumping and countervailing measures),
paragraphs 104 and 105 indicate that Argentina has been a heavy user of anti-dumping action since 1991,
particularly in the sectors of metals, chemicals, and electrical and electronic goods.  What accounts for
this sharp increase in the use of anti-dumping measures?
With reference to paragraph 109, under the interim framework, will the common anti-dumping
regulations being developed for MERCOSUR tr eat dumped imports originating from non-MERCOSUR
countries the same as those orig inating in MERCOSUR countries?
Under the proposed common anti-dumping regulations, will actions based on a complaint from an
industry in one MERCOSUR country, result in a region-wide  application of duties?  Will this be the case
even when other MERCOSUR countries do not produce the product?
On Export insurance and guarantees
With reference to Chapter III, section 3, sub-section (ix) (Export insurance and guarantees),
paragraphs 136-138, several government assistance programs outlined in the Trade Policy Review wereWT/TPR/M/47
Page 26
not included in Argentina's recent notification of subsidies measures (G/SCM/N/38/ARG).  Why were the
following programs not included?
Export insurance, export promotion, and mark eting assistance schemes (paragraphs 136-138);
Free-trade zones (paragraph 142);
Incentive programs administered by the provinces (paragraph 146);
Sectoral contracts (paragraph 147);R&D programs (paragraphs 148 and 149);  and
Sectoral promotion programs (paragraph 156).
On Intellectual Property Rights
With reference to Chapter III, section 4, sub-section (v) (Enforcement of intellectual property
rights), transfer of proprietary information, paragraph 177, is it Argentina's intention to have the INPI or
any other official Argentine agency, continue to  require registration of transfers of technology?
With reference to Chapter III, section 4, sub-section (v) (Enforcement of intellectual property
rights), paragraphs 180-182, could Argentina report on the status of legislation that would see software
included in the copyright law?
What additional efforts are envisioned to combat software piracy?  Specifically, what measures
will be taken to enforce the new law once adopted?
What measures is the Federal Government of Argentina taking to ensure that responsibilities
under international obligations concerning software have been conveyed to the appropriate provincial
authorities?
On Agriculture
With reference to Chapter IV, section 1, paragraph 3, what is the status of export taxes on
unprocessed oilseeds to assist domestic processing firms?  Is there any recent policy change on thismeasure?  What types of effects have these taxes had on imports of unprocessed oilseeds, including the
price effect on domestic and imported oilseeds?
According to Chapter IV, section 2, sub-section (i), paragraph 13, under the reforms of the last
decade, Argentina made changes in the mechanism to make transfers in the agricultural sector, shifting
from price-related transfers towards other net transf ers via marketing boards prior to their elimination.
Can Argentina indicate what type of transfers were undertaken through marketing boards?  Are they still
in place?  If some of these measures are still in place, how are transfers undertaken after the elimination
of marketing boards?
With reference to Chapter IV, section 2, sub-section (i) (Other), paragraph 25, following the
elimination of the National Grains Board, Argentina ha s progressively eliminated bilateral agreements for
the supply of grains to other countries at negotiated prices.  Are any of such agreements still in place?
How has the elimination in 1995 of the agreement with Brazil to supply duty-free 2 million tonnes of
wheat a year affected Argentina's wheat prices for exports to Brazil?
With reference to Chapter IV, section 2, sub-section (i) (Sugar cane), paragraphs 33 and 34, can
Argentina explain the system of variable import levies on sugar?  Could Argentina provide information
on what types of protective measures ( ad valorem  duties, statistical tax, variable levies) are used on the
importation of refined sugar, and data on exports and imports of refined sugar?WT/TPR/M/47
Page 27
According to Chapter IV, section 2, sub-section (i) (Tobacco), paragraph 38, "... decline to
US$84 million in budgetary outlays for the price support mechanism for leaf tobacco was applied for the
1996/97 crop".  Please clarify how the figure of $84 million for the price support mechanism for leaf
tobacco was estimated for the 1996/97 crop?  Could Argentina explain why it differs from the
586.4 million amount noted in Argentina's reply to G/AG/N/ARG/4 at the meeting of Committee on
Agriculture, March 19-20, 1998?  Specifically, Argentina noted that "we are able to inform theCommittee that, in accordance with the values assigned in the 1996/97 agricultural year, domestic support
for tobacco reached a total of US$86.4 million".
Also, kindly explain how the $98 million amount reported as the cost of the price support
mechanism in 1995 was arrived at?
On Fisheries
Chapter IV, section 2, sub-section (ii) (Fisheries), paragraph 50 indicates that, between 1990
and 1997, there was overfishing of some species, such as squid.  Paragraph 53 indicates that between1992 and 1998 the exploitation of Argentine fisheries resources by foreign vessels (under a temporary
chartering regime) centred on squid, in an effort to increase the catch of that species and to compensate
for the absence of national vessels fishing for squid.  What measures has Argentina taken to deal with
overfishing of squid by foreign vessels?
Does Argentina consider that improved market access for its squid exports was a principal factor
which led to this overfishing?
Paragraph 54 describes the bilateral Fisheries Agreement which Argentina concluded with the EU
in November 1992 and which came into force in April 1994.  That agreement "allows EU fleets access to
Argentina's 200-mile reserved zone in exchange for a 50% reduction in the EU import tariff on Argentine
fishing products".  Which specific Argentine products (by HS tariff heading) are covered by the EU tariff
reductions, and what are the applicable rates of duty?  Are the EU reduced rates of duty, contained in the
text of the agreement?
Are these tariff reductions subject to any quantitative limits?
What are the rules of origin that apply to Argentine products exported to the EU under this
agreement?
Does Argentina intend to extend this agreement, given the statement (in paragraph 54) that,
despite the agreement, there has been no expansion of Argentine fish exports to the EU since 1994?
Paragraph 55 states that bilateral discussions on the establishment of possible fisheries
agreements are being held with China, Chinese Taipei, Japan, and Korea.  Is market access (e.g. reduction
in tariffs by those trading partners for fish product imports from Argentina) part of those discussions?
More generally, it appears that Argentina is pursuing a policy, of exchanging access to its fish
resources in return for access to markets for Argentine fish products.  Does Argentina consider this policyconsistent with its general policy objective of ensuring "preservation of resources" (see paragraph 52)?WT/TPR/M/47
Page 28
On Forestry
With reference to Chapter IV, section 2, sub-section (ii) (Forestry), paragraph 59, is there an
export requirement for any of the forestry programs outlined in this paragraph?
On Motor Vehicles
With reference to Chapter IV, section 4, sub-section (iv) (Motor vehicles), paragraph 123 and
Box IV.2, is Argentina on target to remove its Automotive Industry Regime on 1 January 2000?
On Financial Services
Chapter IV, section 5, sub-section (ii) (Financial services), paragraph 147 indicates that
Argentina's moratorium on the establishment of new insurance firms, as provided for in its Schedule of
commitment's, is due to be lifted on October 1, 1998.  Has this occurred and if not, when is it expected to
be lifted?
On Telecommunications
With reference to Chapter IV, section 5, sub-section (iii) (Telecommunications), paragraph 157,
is Argentina on target to liberalize the basic telecommunications sector on  the committed date of
8 November 2000?
We understand the 1997 public tender for the supply of personnel communications (PCS) for the
Buenos Aires area had been stopped by a judicial process, and that the tender was to be reconducted in
December 1998.  May we have information on the status or outcome of the tender?
Government Report (WT/TPR/G/47)
On Agriculture
With reference to Section 3.2 (Argentina in ME RCOSUR), what is the extent of Argentina's
exemption of agricultural products from MERCOSUR internal tariff elimination?  What are the major
agricultural products exempted by Argentina from ME RCOSUR internal tariff elimination and what is the
level of trade that may be affected by these exemptions?
Section 3.4.2 (Prospects), paragraph 6 states, "In the field of agriculture, Argentina will continue
to promote further liberalization of trade in multilate ral forums, in coordination with trading partners with
whom it shares common positions."  Could Argentina provide details regarding the areas of agriculture in
which it would propose further liberalization?
On WTO Dispute Settlement
With reference to Section 3.4.2, paragraph 12, could Argentina provide details on the operational
fine-tuning it believes is necessary for the WTO dispute settlement mechanism?
Could Argentina indicate which provisions of the dispute settlement mechanism should be
adjusted and the nature of any proposed adjustments?
Could Argentina indicate which rules of th e dispute settlement mechanism need further
interpretation?WT/TPR/M/47
Page 29
OTHER QUESTIONS
On the Integrated Delta Base (IDB)
Based on the WTO document G/MA/IDB/2/Rev.3, which reports on the status of submissions of
the Integrated Data Base (IDB), Argentina has submitted its 1998 tariff but has yet to provide any trade
data.  Can Argentina confirm that it will be providing its 1998 trade data before the September 1999
deadline?
Can Argentina confirm that it will be submitting its 1999 tariff before April 1999?
On Tariff Schedule (Electronic Loose Leaf)
Has Argentina begun work on preparing its electronic loose leaf schedule?
Does Argentina plan to take advance of the technical assistance offered by the WTO Secretariat
in preparing its electronic loose leaf schedule?
On the Information Technology Agreement
Given the importance of information technology goods as major inputs to economic growth,
adjustment, and development, as well as in world trade, will Argentina consider joining the Information
Technology Agreement?  If not, please indicate why?
COMMENTS ON WTO SECRETARIAT REPORT
On Agriculture
With reference to Chapter IV, Section 2, sub-section (i) (Tobacco) of the WTO Secretariat
Report, we suggest the following revisions:
(a) With reference to paragraph 38, we suggest replacing "US$90.6 million in 1996" with
"US$90.6 million in 1995/96 (in December 1995 dollars)";  replacing "US$79.6 million in the
year 2005" with "US$79.6 million in the year 2004/05 (in December 1995 dollars)";  and
replacing "the AMS in 1996 stood at US$122.8 million" with "the AMS in 1995/96 stood at$122.8 million".
(b) With reference to paragraph 39, we suggest replacing "At the time of the completion of this
report" with "By the summer of 1998".
(c) To provide an update on the current situation, we suggest adding the following as a new
paragraph after paragraph 39 to read as follows:  "On July 31, 1998, Argentina submitted arevised schedule LXIV with annual and final commitment levels for 1995/96-2004/05.  Based on
the revised schedule LXIV, Argentina exceeded its Total AMS commitment level for 1995/96; as
noted above, Argentine authorities report that expenditures were to be within the commitment
levels thereafter."WT/TPR/M/47
Page 30
On Professional Services
The Secretariat's Report provides almost no information regarding the professional services
sector.  Given that Argentina is a significant importer and exporter of professional services, information
regarding this sub-sector would have been desirable.
QUESTIONS BY COSTA RICA
(1) Convertibility plan
Has the impact of the convertibility plan on the prices of tradable and non-tradable goods been
analyzed, particularly after the strong real appreciation of the Argentine peso when the plan was
introduced?  Has it led to any substantive change in the country’s production or consumption structure?
What are the prospects for the convertibility plan of the Argentine peso given the current context of the
devaluation of the Brazilian real?
(2) MERCOSUR
Argentina’s exports to Latin America (exclu ding MERCOSUR) have grown considerably.
However, the same does not hold true of imports from those countries, even though the real exchange rate
in Argentina between 1992 and 1997 has remained virtually unchanged.  To what conditions or
circumstances do you attribute this phenomenon?
(3) Social
The report mentions some of the social costs to the Argentine economy during implementation of
the new economic policies since 1991.  Predominant among them are the high open unemployment and
underemployment rates.  Are there assistance programmes or some kind of unemployment insurance?  Do
you believe that the phenomenon is transitory?  Do you think that the process itself will help to remedy
the problems or will it be necessary to implement policies in this regard?
(4) Registration and documentation
Are importers required by law to have a certificate of origin in their possession for merchandise at
the time they import it?
(5) Market access and Rules of Origin
Are the benefits obtained by some sectors (for ex ample, sugar, clothing and footwear) from the
measures that have been taken decisive for their surv ival and competitiveness?  If so, how to you plan to
deal with this situation when tariffs are eventually reduced under WTO trade liberalization programmes?
What, specifically, are the special customs regimes in effect in Argentina, how do they operate
and what incentives do they offer the beneficiaries?
(6) Investment
Does Argentina have any policy to foster, subsidize or benefit new foreign investment?
Does the Invertir Argentina Foundation grant benefits of any kind to attract foreign investment to
Argentina?WT/TPR/M/47
Page 31
(7) Agriculture and Sanitary and Phytosanitary Measures
From 1992 to 1996 a major change occurred in production structure (in terms of value) with the
share represented by crops rising by 25% against a reduction of over 29% for livestock.  One of the
reasons mentioned is less government intervention in production and marketing.
Mention is also made of the changes in the country’s sanitary and phytosanitary legislation as
well as progress in the control and eradication of certain major pests and diseases such as foot-and-mouthdisease.  Argentina has been declared free of the disease and the United States has approved imports of
Argentine beef.
This situation leads to the following concerns:
- Has the private sector been allowed to play a greater role in carrying out these activities
on its own, specifically with respect to animal and plant health (vaccinations,
laboratories, training, and extension)?
- What role was played by the National Meat Board and the National Grains Board in the
formulation of sectoral policies, transfers of funds from the public to the private sector
and sanitary improvement in activities?
(8) Export subsidies, export insurance/guarantees, export taxes
What is the size of the subsidies paid to agriculture through subsidized credits?
(9) Intellectual property
What type of protection does Argentine legislation provide for plant varieties?
QUESTIONS BY THE CZECK REPUBLIC
According to the Secretariat’s Report, Argentina was among the seven countries with the highest
number of anti-dumping cases initiated each year between 1992 and 1997.  In our experience, each
anti-dumping investigation has a negative impact on ex port flows, even in cases where the investigation
does not lead to anti-dumping measures.
Could the Argentine Delegation comment in more detail on its list of antidumping measures?
Does it view their heavy use as directly proportionate to the liberalization process?
We appreciate that trade policy in relation to particular sectors of the economy has a more neutral
effect and is based on the application of horizontal measures that allow the economy to rise as a whole.
However, there are sectors in which more stringent economic policy measures are applied, which give
rise to relatively high protection for national producers.  The automotive industry is one of these sectors.
Could the Argentine Delegation indicate some steps that could be taken toward greater
liberalization of imports of fully assembled private and freight vehicles?
What changes will occur after the MERCOSUR common regime for the automotive industry is
applied at the start of 2000?WT/TPR/M/47
Page 32
We congratulate Argentina on its economic results and appreciate the active role it plays in the
day-to-day work of WTO.  The Czech Republic would be happy to cooperate with Argentina in preparing
the Third Ministerial Conference of the Member States of WTO.
QUESTIONS BY THE EUROPEAN UNION
On Tariffs:
At the end of 1997, the Argentine Government raised most of its tariffs by 3% in compensation
for the reduction of its statistical tax.  When will this measure be removed?
On Government procurement:
Does the MFN principles apply, at least in pr actice, to Argentina's procurement policies and
practices?
Are foreign firms permitted to participate in all goods and services contracts?  On equal terms
with Argentine firms?
Are foreign firms permitted to participate in public works contracts?  If so, are any conditions
attached to their participation (for example, are they also required to enrol in the National Register of
Public Works)?
Is enrolment in the National Register of Public  Works possible at any time, including after a
tender notice has been published?
Can Argentina confirm that, as paragraph 97 of the Report seems to imply, sub-central authorities
are also subject to the policy and rule-making of the National Procurement Office, or do sub-central
authorities have autonomy to determine their own procurement policies and practices?
On Anti-dumping:
Whilst Article 5.10 of the WTO Anti-Dumping Agreement requires the conclusion of an anti-
dumping investigation, at the latest, 18 months after initiation, Argentina's anti-dumping legislation doesnot appear to contain a time-limit for the completion of investigations.
On a recent question in this respect within the context of the WTO Anti-Dumping Committee
(G/ADP/W/286, p. 50), Argentina indicated that, in  this regard, "Article 5.10 of the Anti-Dumping
Agreement applies".  However, in several cases Argentina has exceeded such limit.  Such cases include
the proceedings concerning drill bits from Italy, where definitive anti-dumping measures were imposedafter 18 months from initiation, and those concerning optical fibre cables from Spain, the U.S. and Brazil,
where the investigation is not yet concluded, after over 20 months from initiation.
How does Argentina explain conformity of these cases with the requirement contained in
Article 5.10 of the Anti-Dumping Agreement?
How and when does Argentina intend to withdraw the measures imposed on drill bits from Italy?
How does Argentina intend to ensure that in the futu re this compulsory time limit is respected in all
cases?WT/TPR/M/47
Page 33
On Countervailing measures:
Resolution 417/97 of April 11 establishes a maximum term for the countervailing duties
established in Resolution 100/96 of the Ministry of Economic Affairs and Public Services on imports of
tinned peaches from non-MERCOSUR countries.  Does Argentina plan to remove these duties before five
years have passed?
Resolution 772/98, of July 2 establishes countervailing duties for two years on bottled and bulk
olive oil from the European Union.  Since, in the op inion of the EU, the investigation has not complied
with all the requisites of the Agreement on Subsidies and Countervailing Measures, does Argentina plan
to review these countervailing duties before the period expires?
On Safeguards:
It appears that the Minister of Economic Affairs has decided to apply specific duties on dolls and
plastic toys weighing not more than 1.2 kg per unit.  Is that the case?  If so, what is the basis for this
safeguard measure, given that the National Foreign Trade Commission determined in October 1998 thatno real or potential injury to the Argentine industry could be demonstrated?
In cases where Argentina initiates a safeguards investigation, how does it intend to deal with
imports from other MERCOSUR countries?
Would imports from MERCOSUR countries be subject to any possible safeguard measures
adopted or would they be excluded from the scope of such measure?
In case MERCOSUR imports were excluded from the scope of the measures, would such imports
be accounted for in the determination of the existence of "increased imports" pursuant to Article 2.1 of the
Agreement on Safeguards?
Similarly, in case MERCOSUR imports were excluded from the scope of the measures, would
such imports be accounted for in the determination of "serious injury" caused by increased importspursuant to Article 4 of the Agreement on Safeguards?
Finally, would MERCOSUR imports be accounte d for in the determination of "critical
circumstances" for the establishment of provisional safeguards measures pursuant to Article 6 of the
Agreement on Safeguards?
On Customs valuation and preshipment inspection:
How is the preventive mechanism concerning under- or over-invoicing designed to avoid
disturbing transactions at normal market price levels ?  In other words, how does Argentina guarantee that
the application of the preventive mechanism will not result in arbitrary minimum import price
requirements?WT/TPR/M/47
Page 34
On Services:
General comments
Paragraph 132:  We would appreciate confirmation from the Government of Argentina as to the
coverage and application of Argentina's MFN exemption on satellites facilities of geostationary satellites
operating fixed satellite services.
Paragraph 135:  Could the Government of Argentina confirm the current state and plans for
implementation of the MERCOSUR Framework Agreement on Services adopted in December 1997?
Telecommunications
Paragraphs 148 and 151:  The last sentence of paragraph 148 indicates that "from
November 1999, two more operators will be allowed to  operate basic telecommunication services".  This
is also confirmed in paragraph 151.  Nevertheless, Argentina has undertaken commitments on all basic
telecommunications services with no restrictions as from November 2000.  Could the Government of
Argentina confirm that as from 8 November 2000 there will be no limitations on the number of providersof basic telecommunication services (except those justified on the basis of legitimate management of
frequencies)?
Paragraph 150:  Could the Government of Argentina clarify what is the role of Inmarsat in the
supply of mobile satellite services which are said "not to be subject to restrictions"?  Can systems other
than Inmarsat provide the necessary facilities for the provision of mobile satellite services in Argentina?
Paragraph 152:  Could the Government of Argentina confirm whether all basic telecom services
are subject to licence in Argentina?  Is that the case also for resale and private voice and data services?
Are there any of those services subject to general authorisation or declaration processes?
Could the Government of Argentina confirm whet her an interconnection framework is in place
and what are its main characteristics?
Could the Government of Argentina indicate whether there is a universal services obligation
system in Argentina and what services does it cover?
Transport
Paragraph 168:  this paragraph indicates that "at MERCOSUR level, Argentina's objectives
include ... the establishment of a Special Register of Vessels and the negotiation of a MultilateralAgreement on Maritime Transport".  Could the Government of Argentina explain what would be the
possible consequences of these developments on market access, i.e. access to the international maritime
market?
Construction services
Paragraph 174.  Could the Government of Argentina provide details as to the on current foreign
participation and the role of foreign firms in the Argentinean construction sector?
Could the Government of Argentina confirm when does it intend to implement the 1995-1999
Investment Programme?WT/TPR/M/47
Page 35
On Intellectual property rights:
Does the 20-year term patent protection provided by Argentina's 1996 patent law apply to all
pending patent applications once the law has entered into force, or is it limited to those applications filed
after October 1995?
Is commercial testing permitted before expiry of a patent?
Article 70.9 TRIPs requires countries which benefit from the transitional period to grant exclusive
marketing rights for a period of five years.  How did Argentina implement this obligation?  Can Argentina
please explain how companies can obtain such exclusive marketing rights?
Does the 1996 data-exclusivity Law 24.766 meet the standards comparable to those set out in
Article 39.3 TRIPs?  If so, could Argentina please explain the reasoning why it considers that full data
protection is granted?
Insofar as Law 24.766 deals with the protection of trade secrets and data submitted to the
regulatory health agencies, the EU is also conc erned about enforcement problems resulting from the
absence of implementing regulations.
Linkage between health product registration and the patent status
The health agencies continue to refuse to take into account the existence of patents when
approving the marketing of products.  Officials cl aim that they cannot apply Article 8 of Law 24.766
because they have not received instructions to that effect.
Could Argentina confirm that the executive power will issue the instructions necessary to
establish a link between product registration and patent status to ensure that officials in charge with
registering new products refuse to approve the marketing of new products where the latter infringe patent
rights?
Application of international standards on regulatory requirements
Are steps being taken in Argentina to ensure that health agencies comply with Article 5 of
Law 24.766 requiring bioavailability and bioequivalence testing - according to international standards - of
the so-called "similar" products (limitations)?
Revalidation of foreign patents
Are steps being taken in Argentina to ensure that pending filings on confirmation of patents are
approved according to the law in force at the time of the filing as ordered by various Court decisions?
Conversion of pharmaceutical process pate nt applications into product applications
Are steps being taken in Argentina to make such conversion possible according to the principles
set in the patent law and in TRIPs Articles 65(5) and 70(7)?WT/TPR/M/47
Page 36
QUESTIONS BY HONG KONG, CHINA
Secretariat Report (WT/TPR/S/47)
MERCOSUR's Common External Tariff (CET)
We note that a temporary increase of the CET by 3% on most tariff items was agreed in
December 1997 to accommodate Brazil's external imbalance and allow Argentina to reduce the level of
its statistical tax.  Given that a customs union should be contributing to the continued process of tradeliberalization and that the increase is said to be temporary, we would like to know when the Argentine
Government will remove the increased tariffs (p. 29, para. 46).
It is mentioned that "the share of MERCOSUR-or igin imports for certain items that benefit from
increased border protection against MFN sources has increased markedly (e.g. footwear and office
machines)".  We would like to know the details of the "increased border protection" in the sectors
concerned and the actual benefits MERCOSUR-origin imports derive therefrom.  Does the protection
refer to merely the gap between the MERCOSUR and the MFN tariff rates or other more specificrestrictive import measures? (p. 32, para. 55)
Registration and documentation requirements
We are aware of the country of origin certificate requirement being imposed by Argentina
authorities on textiles, footwear and clothing since April 1996.  We have heard reports that the same
requirement may be expanded to cover toys from, among others, Hong Kong.  We would welcome fulland early clarification of the situation (p. 43, para. 12).
Preshipment inspection (PSI)
We note that PSI became effective on a temporary basis since November 1997.  It was also
mentioned that PSI services were to be privately run for a period of two to three years.  Would the
Argentine Government share with us its long-ter m policy and plan on PSI? (pp. 54-55, paras. 42 and 44)
Competition policy
It is stated that there have been attempts to address weaknesses in the legislative framework in the
area of competition.  We are interested to know more  details on these perceived weaknesses and how they
affect the operation of the market mechanism, and on the latest bill which seeks to address various
provisions (pp. 89-90, paras. 159-166).
Financial
We note that since privatisation took place since 1992, there are still ten provincial banks remain
under public ownership.  We would like to know if Arge ntina has any plans to privatise these ten banks as
well (pp. 133-134, paras. 141-142).
We note that the suspension in the establishm ent of new insurance firms was eliminated on
1 October 1998.  Would Argentina submit an improved GATS commitments to reflect the current
situation? (p. 136, para. 147)WT/TPR/M/47
Page 37
Telecommunications services
We note that the exclusive rights of Telecom Argentina and Telefónica de Argentina  in basic
telecommunications services will expire by October 1999 and two more operators are to be authorised to
provide basic services.  It is however stated in Argentina's Schedule of Specific Commitments that there
will be liberalisation by 8 November 2000.  Does it mean that Argentina will liberalise this sector earlier
than scheduled? (pp. 136-137, paras. 148-152)
In Argentina's Schedule of Commitments, it is stated that mobile telephone services are supplied
under a duopolistic regime.  However, in the Secretariat Report, it is stated that the territory is divided
into three regions and each is serviced by two diff erent companies; Movicom and Movistar/Miniphone for
the Greater Buenos Aires area; CTI Norte and Telecom personal for the northern part; CTI Sur and
Unifon/Telefónica de Argentina for the south.  Does it mean that the duopoly has already ended? (p. 136,
para. 149)
QUESTIONS BY HUNGARY
Paragraph 12 of the Summary Observations and paragraph 49 of Part III of the Secretariat Report
refers to the ad valorem  statistical tax charged only on imports from non-MERCOSUR countries.
Welcoming the reduction from 3% to 0.5% over a year ago we would be interested to know what is the
legal basis for the measure and the exemption of free trade partners and also if the Government intends to
further reduce or eliminate this tax.
Paragraph 14 of the addendum to the Secretariat Report informs us that the PSI regime of
Argentina was modified in October 1998 to the effect that the inspection costs covered were raised to 0.95
ad valorem  or a minimum of US$120 per shipment.  We would be interested to learn more about the
reasons behind the application of an ad valorem  charge and also about the reasons necessitating these
modifications.
QUESTIONS BY JAPAN
External debt (paras. 20 & 21, Table I.4 (pp. 10 & 11) of the Secretariat Report)
The amount of external debt, a large part of whic h is public debt, has been increasing since 1991.
Please explain the future prospect and how Argentina will tackle the problem.
Regional Agreements
It is reported that the CET of MERCOSUR affect ed 65% of Argentina's imports from outside the
region or 70% of the tariff lines. Such low rate of coverage of the CET seems to be inconsistent with
Article XXIV:8(a)(ii) of the GATT which provides that duties should be eliminated with respect to
"substantially all the trade". Please explain Argentina's view on this point (para. 46, p. 29).
Argentina and other MERCOSUR countries have raised the CET by 3% at the end of 1997.  Is
not this measure against the spirit of Article XXIV:4 of the GATT which provides that the purpose of a
customs union or a free-trade area should not be "to raise barriers to the trade of other contracting partieswith such territories"? (para. 46, p. 29)WT/TPR/M/47
Page 38
Are there any products the CET rates of which exceed Argentina's bound tariff rates?  If so, it is
inconsistent with Article II of the GATT to raise tariff rates without conducting Article XXIV:6
negotiations.  Please explain Argentina's view on this point.
Regional trade agreements signed between ME RCOSUR and its neighbouring countries includes
some provisions which seem to be not conformity with Article XXIV of the GATT. For example,
free-trade agreement between MERCOSUR and Chile phases out the internal tariff within 18 years inspite of paragraph 3 of the "Understanding of the Interpretation of Article XXIV of the GATT 1994"
which provides that "reasonable length of time" to form a free-trade area should exceed ten years only in
exceptional cases.  To add with, some preference arrangements within the LAIA members are not
consistent with Article XXIV:8 of the GATT which provid es that duties should be eliminated with respect
to "substantially all the trade".
It seems that these agreements, which are free-trade agreements between developing countries,
are concluded under the enabling clause.  However, there has been no consensus on relationship betweenthe enabling clause and Article XXIV of the GATT.
As reported in the Secretariat Report, some other negotiations are under way to establish regional
trade agreements including developed countries such as the FTAA and such RTAs should be established
fully in conformity with Article XXIV of the GATT.  Could Argentina confirm that the establishment of
FTAA is being negotiated to be in full conformity w ith the WTO Agreements;  i.e. the duties and other
restrictive regulations of commerce are to be eliminated on substantially all the trade within ten years?
(para. 36 (p. 26), para. 50 (p. 30), para. 53 (p. 31))
Safeguard actions (para. 112, p. 78)
Argentina has applied safeguard measures against imports of footwear products.  Although
MERCOSUR countries were the main sources of the rapid increases in footwear imports and imports
from non-MERCOSUR countries are declining, the safeguard measures were imposed on imports from
non-MERCOSUR countries. Is not such measure in consistent with the Safeguard Agreement?
Tariff
Although Argentina has adopted the HS96 classification since 1 January 1996, Argentina has not
completed its modification of its Schedule to introduce HS96. Argentina obtains waiver which suspendthe application of the provisions of Article II of GATT 1994 until 30 April 1999.  Please explain the
prospect for completion of the modification of its Schedule (para. 18, p. 44).
It is reported that applied rates for automobiles, temporarily exempt from convergence, are much
higher than those in the CET.  When does Argentina expect to converge the tariff of automobiles to the
MERCOSUR CET? (para. 23, p. 46)
Are there any exceptions to the MERCOSUR CET other than those listed in Table III.1 (p. 47)?
Customs valuation
In February 1997, Argentina introduced new measures regarding customs valuation for consumer
electronics, which almost actually determines price of the imported goods according to reference price.
These measures are said to aim at avoiding under-invoice.  However, if declared value is below the
reference price, deposits equivalent to customs duty and value added tax are required.  Investigation for
adequacy of declared value needs as long as 120 days.WT/TPR/M/47
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What are the criteria to judge whether the declared value is adequate?
Such scheme, if applied in a discretionary planner, may be inconsistent with Article 7.2 of the
Customs Valuation Agreement which prohibits determining customs value on the basis of "minimum
customs values".  Please explain why such scheme is consistent with the WTO rules.
The reference price is in principle determined as the sum of the basic price of that product and the
additional price for each function and it varies according to country of origin and manufacturer.
On what basis does Argentina determine such reference price?
Reference prices are sometimes established for products which mentioned manufacturers do not
produce.  Is not this against Article 7:2 of the Cu stoms Valuation Agreement which prohibits determining
customs value on the basis of "arbitrary or fictitious values"?
In most cases, reference prices of imported goods from Japan are increased by 15%.  Is not this
against the MFN principle?
Countertrade (paras. 72-74, p. 65)
Please provide clear explanation on the scheme of the countertrade.
Please explain the consistency of this scheme with the WTO Agreement.
Standards and other technical requirements (para. 89, p. 72)
It is reported that "special rulings" on marking affects various products.  Please provide
explanation on "special rulings".
Local-content requirements (para. 102, p. 75)
1996 amendment of Argentina's local content requirement regime increased the level of local
content in automobiles.  Is not this amendment inconsistent with Article 5:4 of the TRIMs Agreement?
Please explain the present situation and prospects of eliminating local-content schemes to meet
the requirements of the TRIMs Agreement.
Competition and consumer policy
It is reported that no prior governmental examination and regulation of mergers or other
combinations is foreseen.  Please explain the reason (para. 160, p. 89).
It is reported that eight amendment bills on competition legislation have been introduced to the
Congress but have not gained enough support to be passed by both houses (para. 163, p. 89).
- Please explain the reason for not gaining support from the houses.
- Please explain the further details of the amendment bills.
MERCOSUR's Competition Protection Protocol wa s agreed in December 1996. Please explain
the relationship between the Protocol and domestic competition law (para. 163, p. 89).WT/TPR/M/47
Page 40
Please explain the relationship between legislation on consumer defence and the competition
legislation in Argentina.
Financial services
It is reported that lending transactions and other operational limits for foreign bank branches are
based on the capital of the local branch, rather than the global capital of the bank for prudential reasons
(para. 140, p. 133).
- Please explain why the branch capital is used as the base.  The credibility of a bank
should be judged by its total capital and such regulation might cause barrier for foreign
banks to enter into Argentina's market in branching.
Japan appreciates the establishment of new insurance operators, suspended since 1977, has been
authorized from October 1998.  Please explain why minimum capital requirements have been raised from
US$550,000 to US$3 million (para. 146, p. 135).
Telecommunications services
It is reported that market access is subject to reciprocity conditions concerning fixed satellite
communication geostationary services.  Japan understands that this limitation is aimed at the development
of domestic satellite communication system in Argentina, thus such limitation should be eliminated in
accordance with the development of the system (para. 150, p. 137).
Please explain the present situation of the development of the system as well as prospect for the
elimination of the above limitation.
Argentina commits no limitations on market access and national treatment for modes 1, 2 and 3
from 8 November 2000 in most of the subsectors.  On the other hand, as stated in paragraph 151, p. 137,
of the Secretariat Report, in 1997, exclusive rights of the two operators on basic telecommunications
services were extended until 1999.  Please explain the schedule for liberalization by the year 2000 as wellas if there has been any change of the timeframe affected by the extension of the exclusive rights.
Transport services
Shipping (para. 168, p. 141)
It is reported that at MERCOSUR level, the establishment of a Special Register of Vessels and
the negotiation of a Multilateral Agreement on Maritime Transport were proposed.
- Please explain on "Special Register of Vessels".
- Please also explain the content of the "negotiation of a Multilateral Agreement on
Maritime Transport".
Air transportation (para. 169, p. 141)
It is reported that all special rights of the national carrier, Aerolíneas Argentinas, will be removed
by the year 2000.
- Which special rights does Aerolíneas Argentinas have?- Please explain the expected schedule for the removal of the special rights.WT/TPR/M/47
Page 41
QUESTIONS BY MEXICO
How has the programme functioned in practice?
How many companies have been inspected?
Has this become a non-tariff barrier?
Do you plan to retain the programme for a given time and then eliminate it or has it been implemented as
a permanent programme?
Do you expect to increase or reduce the tariff universe subject to this measure in the short, medium and
long terms?
Do you intend to introduce a challenge procedure for importers and exporters in respect of the actions of
inspection companies?
What control do you maintain over the inspection companies?
QUESTIONS BY NEW ZEALAND
Secretariat Report (WT/TPR/S/47)Sectoral Trade Policy Objectives (Pt II(4), p. 22, para. 18)
We welcome the significant efforts made by Argentina towards liberalisation of its economy.
However, we note the Secretariat's Report that Argentina still maintains border protection and encourages
domestic supplies for certain domestic industries through sector-specific trade-related measures.  Does
Argentina have any intention to review these arrangements?
The Uruguay Round and the WTO agenda (Pt II(4), p. 23, para. 20)
The Secretariat reports that full implementation of the WTO provisions on TRIPs and TRIMs will
require important industrial adaptation to new regimes in the pharmaceutical and automobile industries.
Does Argentina have any measures in mind to assist the adaptation of those industries?
Trade Laws and Regulations (Pt II(5), p. 25, para. 29)
We note that a single foreign trade law (Draft Law 23101) has been pending since the previous
Trade Policy Review of Argentina, although some of its mechanisms have begun to be put into place.
Could Argentina provide an update on progress with this draft law?
Regional Agreements (Pt II(6), p. 29, paras. 45, 46, p. 1, para. 55)
We are concerned that the increase in Mercosur's CET may lead to increasing trade diversion.  Do
Argentina and its MERCOSUR partners have any measures in mind to combat this effect?WT/TPR/M/47
Page 42
Registration and documentation requirements (Pt III(2), p. 42, para. 9)
We welcome the efforts of Argentina and its MERCOSUR partners to integrate the information
systems of their customs administrations.  When  do Argentina and its MERCOSUR partners hope to
complete this process of integration?
(Pt III(2), p. 43, para. 12)
We note the Secretariat's concern that Argentina's requirement of a certificate of origin, stamped
by the relevant Argentinian Consulate, for imports of textiles, footwear and clothing may cause delays
and increase costs for exporters.  Does Argentina have any plans to remove this requirement?
Tariffs (Pt III(2), p. 45, para. 21)
How do Argentina and its MERCOSUR partners envisage that the temporary increase of
Mercosur's CET by 3% will affect MERCOSUR's long-term goal of tariff reduction and trade
liberalisation?
Standards and other technical requirements (S/47, Pt III(2), p. 69, para. 77)
We welcome the development of standards accordin g to international guidelines by Argentina.
What measures does Argentina have in place to ensure standards are not in effect technical carriers to
trade?
(Pt III(2), p. 71, para. 87)
We note that Argentina has signed a declaration of intent to negotiate a mutual recognition
agreement with the European Commission on sanitary and phytosanitary regulations.  Does Argentina
envisage also entering into negotiations with other countries on such mutual recognition agreements?
QUESTIONS BY NORWAY
Anti-dumping and countervailing duties
According to the Secretariat's Report (page 75), Argentina was among the seven countries with
the highest number of antidumping cases initiated each year between 1991 and mid 1997.  Has Argentina
undertaken any analysis of the national negative effects resulting from these measures?  Does Argentina
consider it necessary to continue to use antidumping measures in the future?
Export subsidies
Argentina is expected to eliminate any export subsidies for manufactured item, classified as
prohibited under the WTO Subsidies Agreement, by 2003 (Secretariat's Report page 82, paragraph 129).
Is Argentina planning to phase out these subsidies before 2003?  If not, could Argentina elaborate the
reasons behind keeping them?
Regional trade arrangements
From the report of the Government of Argentina, we note that Argentina is an active participant
in regional trade arrangements.  On page 13, second paragraph, of the report, the, Government has stated
that with respect to regionalism much remains to be done to complement and confer consistency on theWT/TPR/M/47
Page 43
interaction between regionalism and the multilateral trading system.  We would appreciate if Argentina
would expand its views in more, detail as to what it feels remain to be done.
We further note that Argentina also is part of interregional cooperation.  What is the policy of
Argentina with respect to develop such cooperation further in substance as well as in respect of new
participants?
Shipping
According to the Secretariat's Report on page 140, paragraph 164, Argentina has bilateral
agreements with Brazil, Cuba, Peru, Romania, the Russian Federation and China which provides for equal
cargo-sharing of bilateral trade carried on vessels operated by ship-owners of the signatories.
Norway would welcome some more informati on regarding these cargo sharing provisions.
Firstly, how much of the bilateral trade is transported on these vessels as a percentage of total bilateral
trade?  Secondly, are cargo rates for bilateral trade higher than international rates, and if so, have any cost
analysis been calculated for the exporters, importers and consumers?  Thirdly, is Argentina planning totake an initiative to eliminate the cargo-sharing provisions?
In the context of MERCOSUR have any reactions been introduced on market access for vessels
from third countries regarding navigation between the MERCOSUR states.  If affirmative, which ones
and are these compatible with the NGMTS (Negotiation Group on Maritime Transport Services) standstill
obligations.
Tariffs
According to our information Argentina has increased their import tariffs on used means of
transport (including used boats) from 15% to 25% in 1995 and further to 28-30% in 1998.
Norway exports a substantial amount of used fishin g boats to Argentina.  We would therefore like
to obtain information regarding the reason behind these high tariff rates as well as an indication of theirfuture status.
Government procurement
We note that Argentina is not a member of the WTO Committee on Government Procurement,
although it has been an observer since April 1997.  Norway would welcome Argentina as a member of
this Committee and ask if Argentina intends to become a member, and if yes, within which timeframe.
Telecommunications
What is meant by "Fixed geostationary satellite services were excluded from any commitments
for the period that already operating suppliers (INTELSAT and PANAMSAT) remain in place"
(Secretariat's Report page 138, paragraph 157).
Agriculture
We note from the Secretariat's Report that the agriculture sector remains of considerable
importance to the Argentine economy and generates, directly or indirectly, the larger part of merchandiseWT/TPR/M/47
Page 44
export revenues.  It is further stated that Argentina once was the world's largest beef exporter, but slipped
to fourth position in 1998.
As a result of the International Office of Epizootics' decision in 1997 to declare Argentina to be
free of foot-and-mouth disease Argentine authorities are said to have planned the establishment of a new
entity with public and private sector participation to promote beef sales abroad.  We would be interested
in receiving further details as regards for instance how to finance the set-up and day-to-day activities of
the new entity, its start of operations, whether a marketing strategy has already been developed and
market shares objectives specified for the short and medium term.
Additional questions
From the report of the WTO Secretariat (page 38, paragraph 84), we note that the Argentine
legislation guarantees several advantages for mining investment.  The general opinion of Norway is that
giving advantages to a specific sector is not positive for the overall economy.  Furthermore, we note that
to be eligible for the mentioned advantageous treatment individuals and corporations must be domiciledin Argentina.  Does Argentina plan to change this policy?
To our information, Argentina uses local content requirements (for instance in the automotive
industry, Secretariat's Report page 74).  Norway w ould like to underline that such requirements are
discriminating and damaging to natural resource allocation.
Finally, according to the Secretariat's Report (page 57, paragraph 48) container handling fees
seem to differentiate between imports and exports;  the maximum rates applied for loading aboard
containers (exports) are 12% lower than those levied for unloading them (imports).  My delegation would
appreciate some information about the reasons behind this difference in fees.
QUESTIONS BY POLAND
MERCOSUR
Argentinian trade and overall economic prospects have become closely tied to macroeconomic
stability and sustainable growth in Brazil.  Please explain the influence of the recent crisis in Brazil on
economic developments in Argentina.  What are previsible consequences of the situation in Brazil in
MERCOSUR trade policy?
MERCOSUR is negotiating at the same time trad e liberalization with European Union and in
frame of Free-trade area of the Americas.  Please explain priorities of MERCOSUR policy in both
negotiations.  Are there any discrepancies between the MERCOSUR members regarding this policy?
Preshipment inspection
In November 1997, Argentina introduced a preshipment inspection of merchandise (1,820 items)
to combat tax evasion, contraband and under-invoici ng.  According to our experience, this measure
distorts Polish export to Argentina causing additional costs and bureaucratic formalities.  Does Argentina
intend to review the application of this measure in order to facilitate trade flow to this country?
Sanitary and phytosanitary regulations
Sanitary and phytosanitary regulations are applied in some cases with excessive rigidity.  It takes
several months for the Argentinian importer of Polish foodstuffs and alcoholic beverages to obtainWT/TPR/M/47
Page 45
necessary certificates.  In 1996, Argentina signed with European Union the declaration of intent to
conclude negotiations for a mutual recognition agreement on sanitary and phytosanitary regulations.  Are
there any intentions of Argentina to conclude the similar agreements with other countries?
Government procurement
Accessibility of foreign companies to public tenders financed by the budget is difficult due to
many formal requirements.  Is there any possibility to change a public tendering procedure in order tomake it easier and more transparent?
QUESTIONS BY THE REPUBLIC OF KOREA
Safeguard actions
The Secretariat's Report stipulates in paragraph 112 of page 78 that Argentina has applied
safeguard measures in the form of minimum specific duties against imports of all footwear products
except ski-boots and snowboards.
Recently, the Argentine authorities extended the application of such duties on developing
countries with low import shares on the basis that developing countries with less than 3% import share
collectively account for more than 9% of total imports of the product concerned.
It is known that multinational footwear manufacturers such as Adidas and Nike which are
members of Argentina's association of footwear producers and importers are exempted from the
application of such duties.
How does the Government of Argentina ensures that this WTO provision is applied on an MFN
basis and consistent with the WTO provisions such as provisions relating to non-preferential rules of
origin?
How does Argentina apply Article 9 of the Agreement on Safeguards with respect to its regional
trade agreement, namely MERCOSUR given that Argentina imports footwear from members ofMERCOSUR?  Are MERCOSUR partners exempted from the application of these safeguards measures?
Or are these partners also affected?
Standards and other technical requirements
The Argentine Government announced in September 1998 its plan to change its standards system
on electric products to a system based on authorization from August 1999.  According to this plan, homeelectric appliances can be imported only after having successfully passed the safety test by the Argentine
Standards Institute.
Did the Argentine Government notify this plan to WTO Committee on TBT?
Paragraph 79 in page 69 of the Secretariat Report mentions that Argentina maintains bilateral
product certification agreements with certain countries and quality system certification arrangements are
in force with certain countries.WT/TPR/M/47
Page 46
What's the policy orientation of Argentina with respect to these agreements?  Is Argentina
considering expanding such kind of bilateral agreements and certification arrangements with other
countries?
QUESTIONS BY THAILAND
The latest status/information on the preferential trade arrangements among members of the
Mercosur, particularly those which concerns Argentina.
Latest status/information on the measures being applied by Argentina to the following items of
goods:
- Cane sugar (previously non-automatic import licensing was applied);
- Boxes, cases, crates and similar articles of plastic (previously minimum import price was
applied);
- Tableware and kitchenware of other plastics (previously minimum import price was
applied).
QUESTIONS BY THE UNITED STATES
Intellectual Property
How does Argentina intend to ensure that ANMAT recognizes its responsibility to enforce EMR
and that the Government of Argentina, therefore, provides EMR as required by TRIPs?
How does Argentina justify its recent elimination of the previously-provided ten years of
protection for proprietary test data for agrochemicals in light of the standstill obligations under TRIPs?
What is the status of Argentina's efforts to protect proprietary test data submitted in connection
with applications for marketing approval for pharmaceutical products against unfair commercial use?
How does Argentina intend to meet its TRIM obligations as regards the protection of proprietary
data?
What is the status of Argentina's efforts to enac t a law dealing specifically with the protection of
layout designs of integrated circuits ?
What is the status of the trademark law amendment concerning border protection?
Will the trademark law amendment include provisions addressing concerns about the inability of
firms to obtain criminal prosecution, monetary damages, and criminal sanctions against counterfeiters?
What is the status of Argentina's enforcement efforts for copyrights?  What is the status of
Argentina's efforts to increase deterrents to copyrights piracy?
Could the Government of Argentina please outline its efforts to bring its copyright law up to
TRIPs standards?
Could the Government of Argentina please detail efforts to develop a common IPR regime in
MERCOSUR?WT/TPR/M/47
Page 47
Customs Valuation
As Argentina is aware, the establishment of price bands or ranges, and any other reference price
mechanism is not provided for under the Customs Valuation Agreement.  What plans are underway to
eliminate recourse to such mechanisms?  Has there been any, resolution of the June 1997 concern
expressed by Korea (G/C/M/20) of Argentina's price verification scheme?
Charges Other Than Import Duties Affecting Imports Only:  We understand that in Argentina,
merchandise handling and storage fees are determined by weight as opposed to value.  According to the
information provided. container handling fees seem to differentiate between imports and exports.  The
maximum rates applied for loading containers for export were reported as being 12% lower than those
applied for unloading imported containers.  Could Argentina explain why container handling fees vary
between exports and imports?
Safeguards
We have serious concerns about the modification of the Argentine footwear safeguard through
Resolution 1506, put forth by the Argentine Ministry of Economy in November 1998.
Pursuant to this Resolution, the Government of Argentina delayed all scheduled liberalizations of
the safeguard duty until only two months before its termination in February 2000 and imposed a quota on
top of tile already existing safeguard duties.  This action appears to contradict the requirements of'
Article 7.4 of die Safeguards Agreement, which states that WTO Members "shall progressively liberalize[the measure] at regular intervals during the period of application".
This Argentine footwear safeguard measure has not been liberalized, and in fact has become more
stringent, since the measure was imposed provisionally in February 1997 and finally in September 1997.
We welcome comments by the Government of Argentina regarding how a measure that strengthens rather
than liberalizes the terms of a safeguard can comport with Article 7.4.
In September 1998, the Argentine National Foreign Trade Commission (CNCE) concluded its
safeguard investigation on toys, resulting in an unanimous determination by the CNCE that no injury was
suffered by the Argentine toy industry.
However, we understand that a draft decree is close to approval that would impose new, higher
customs duties oil imported toys.  Is this actually the case?
We are concerned that the Government of Argentina would consider drastically raising tariffs on
these items, particularly given the recent CNCE determination that the industry has suffered no injury
from imports.  What would be the WTO rationale for such a tariff increase?
Could the Government of Argentina please detail the status of efforts in MERCOSUR to develop
a common safeguards regime?
PSI
In the year that Argentina has had pre-shipment inspection in effect, what has been the overall
assessment of its effectiveness?  How does the Government of Argentina intend to prevent undue delaysWT/TPR/M/47
Page 48
in processing?  Does Argentina still plan to reevaluate its reliance oil PSI services after two or three
years?
We note that the inspection commission charged by the PSI companies is 0.8% of the f.o.b. price
of the goods, plus 5% of the amount of increase in tax collection.  This seems like a recipe for finding
undervaluation in every invoice, Could the Government of Argentina please comment on the possibility
of restructuring its arrangement with the PSI co mpanies so that the inspection commission and bonuses
are not calculated on an ad valorem  basis?
According to Resolution 1106 (effective October 1,  1998 and in force), the minimum order value
requiring a preshipment inspection was lowered from $3,000 to $800 for 1,820 tariff lines.  Could
Argentina please explain why the Argentine PSI regime was made more stringent after less than one year
in operation?
Standards and other Technical Requirements
Marking, labeling and packaging: We note that during the customs clearance process, imported
goods are inspected for country of origin markings.  It is indicated that a country of origin "special ruling"
is maintained for products such as potatoes, fresh fruits and vegetables, dried or preserved fruits and nuts,
and several other products.  If all products are not subject to country of origin "special rulings" could
Argentina provide a comprehensive list of those products that are?  What criteria are used to determine
products that are inspected according to these "special rulings".
Could the Argentine delegation please comment  on efforts within MERCOSUR to harmonize
standards and other technical requirements?
Services
We note statements by the Secretariat, in para. 132, that Argentina provides preferential treatment
to some of its trading partners in audiovisual services and land transport services.  The Secretariat's notestates that while Argentina's trading partners have listed MFN exemptions in these areas, Argentina has
not.  Could Argentina provide its views on whether it provides MFN treatment in these areas?
We note that Argentina and the other three members of MERCOSUR are actively engaged in
regional services liberalization negotiations.  We welcome regional services liberalization initiatives that
are consistent with WTO disciplines.
Could Argentina provide information on the status  of these negotiations, the extent to which
preferences are currently in force, and Argentina's plans to submit the services agreement for WTO
review?
What is the current timeframe for full liberalization of trade in services among Mercosur's
members?
Can Argentina confirm that non-MERCOSUR serv ice suppliers established in a MERCOSUR
member country benefit from Mercosur's preferences ? [reference is to GATS Art. V:6 the MERCOSUR
services protocol appears to require a head offi ce in a MERCOSUR member to benefit from the
agreement]WT/TPR/M/47
Page 49
Tariffs
We note that MERCOSUR raised its common external tariff in November 1997.  Could
Argentina please explain why this step was taken and how it was implemented by Argentina and the
members of MERCOSUR in light of Argentina's and the pact's WTO obligations?  Has this change now
been notified to the WTO?
Incentives
Section 11 on page 8 of WT/TPR/S/47 indicates that Argentine Government "efforts to reduce
public expenditure were focused on suppression, under the Convertibility Law, of the tax adjustment for
inflation purposes and the elimination or reduction of  certain tax incentives such as drawbacks for
exports, incentives linked to sale of domestically produced capital goods, and the industrial specialisation
regime".  Could Argentina please state to what extent each of these programs has been reduced, and
provide detailed information on programs still in existence?
Export Subsidies
In section (vi) titled "Export Subsidies" on pa ge 89 of WT/TPR/S/47 number 127 states, "Under a
scheme introduced in 1985, run by MEOSP, rebate s of 15% to non-MERCOSUR destinations, benefit
exports of industrial plants and engineering operations under turnkey contracts; the types of operations
covered by the scheme are specified in domestic legislation (annex list to Decree 525/85) and the
exporting company must be in charge of the entire protect."  [Law 23101, 28 September 1984;Decree 525/85, 15 March 1985; Decree 1011/91; De cree 2275/94; MEOSP Resolutions 437/85, 355/95
and 32/96; GATT (1992); IMF(1996)]
Such rebates arc calculated on the f.o.b., c. and f, or c.i.f. value of the export, depending on
whether the exporter selects domestic or foreign insurance or transportation firms; this valuation method
appears to provide an incentive for choosing local firms.  Eligibility remains tied to local- and
goods-content requirements (not less than 60% and 40%, respectively), based on the f.o.b. "export value".
Could Argentina provide more information rega rding how the rebates are calculated, and which
companies and/or industries currently benefit from the program?  Also, is there a date for the termination
under the program?
Following the International Office of Epizootic's (IOE) decision declaring Argentina to be free of
foot-and-mouth disease in 1997, the Government of Ar gentina planned the establishment of a new entity
with both public and private sector participation to promote beef sales abroad.  Could Argentina explain if
such an entity, has been established?  If so, please explain the role(s) of public and private participation in
these entities with respect to funding sources, and how they execute promotion plans.
Tax Registry
In section III, paragraph 8, the Secretariat document states that the trade registry is open to
operators in possession of a Tax Identification Number.  Does everyone have a Tax IdentificationNumber?  If not, what is involved in getting such a number?
Government procurement
As an observer to the Committee on Government Procurement since April 1997, has Argentina
given further consideration to joining the WTO Plurilateral Agreement on Government Procurement?
Does the domestic legislation relating to government procurement also apply to government
concessions?WT/TPR/M/47
Page 50
To what extent does the domestic legislation relating to government procurement create a
mechanism for the review of procurement awards and procedures?
Are instances in which direct contracting (as opposed to open or selective tendering) is permitted
clearly prescribed in domestic legislation, or is it left to the discretion of the procuring
Paragraph 92 states that, "[i]n case of equality of bids, preference is given to suppliers of
domestic goods and to local bidders for services and public works contracts".  What is meant by cases of"equality of bids"?  Does this just refer to equality of price, or to other factors as well?
Paragraph 92 states that there is no requirement (except in the area of telecommunications) for the
use of a preferential margin favoring domestic companies.  Under what circumstances are such measures
permitted but riot required?  Is the existence of such  measures in the context of particular procurements
made known in tender documentation?
Paragraph 98 refers to mandatory controls over procurement by the National Administration of
the Office of Auditor-General (SIGEN).  Please describe the mandatory controls referred to in thisparagraph.
Labor
We view MERCOSUR's development of the Social and Labor Declaration as a positive
development with a potential to promote respect for core labor standards.  We have a few questions about
the Declaration based on our reading of the Spanis h text and on Argentina's policy on employment and
labor matters.
What does the Declaration foresee as the process for consulting with labor organizations and
employers to obtain their views on changes to labor law or policy? [Art. 23]
What kinds of remedial work programs or technical assistance will be provided in response to
failure to implement the social principles in the Declaration?
How will implementation of the Declaration be coordinated among MERCOSUR members?
What is the status of pending legislation regarding labor market flexibility?  In developing such
provisions, is it important to ensure that core labor standards are maintained?
The Anti-Dumping Agreement requires Members to complete anti-dumping investigations within
18 months.  Could Argentina explain how it complied wi th this obligation in its investigation of imports
of fiber optic cable from the United States, the European Community and Brazil?
TRIMs
In its submission, Argentina asserts:  "Automotive products are subject to special regimes under
Common Market Council Decision 29/94 and will co nform to the common regime on 1/1/2000."  Could
the Government of Argentina please comment on ef forts within MERCOSUR to ensure that the common
automotive regime will comport with WTO requirements by the year 2000?
Regional Integration
What is the status of Mercosur's efforts at regional integration?  In what live negotiations does
MERCOSUR currently participate and what is the objective of these negotiations?WT/TPR/M/47
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ANNEX II
RESPONSES TO QUESTIONS AS SUPPLIED BY THE
AUTHORITIES OF ARGENTINA1
I. ECONOMIC ENVIRONMENT
(a) Macroeconomic situation:  financial crisis; contagion; trade and current accounts;
macroeconomic adjustments; fiscal accounts (tariffs), unemployment and labour marketflexibility;  fiscal exchange rate;  competitiveness;  debt;  privatization
Poland
Argentinian trade and overall economic prospects have become closely tied to macroeconomic stability
and sustainable growth in Brazil. Please explain the influence of the recent crisis in Brazil on economic
developments in Argentina.  What are the previsible consequences of the situation in Brazil in
MERCOSUR trade policy?
Japan
External Debt (paras. 20 & 21, Table I.4 (pp. 10 & 11) of the Secretariat Report)
The amount of external debt, a large part of which is public debt, has been increasing since 1991.  Please
explain the future prospect and how Argentina will tackle the problem.
Costa Rica
Has the impact of the convertibility plan on the prices of tradable and non-tradable goods been analyzed,
particularly after the strong real appreciation of the Argentine peso when the plan was introduced?  Has
it led to any substantive change in the country’s production or consumption structure?  What are the
prospects for the convertibility plan of the Argentine peso given the current context of the devaluation of
the Brazilian real?
The report mentions some of the social costs to the Argentine economy during implementation of the new
economic policies since 1991. Predominant among them are the high open unemployment and
underemployment rates.  Are there assistance programmes or some kind of unemployment insurance?  Do
you believe that the phenomenon is transitory?  Do you think that the process itself will help to remedy
the problems or will it be necessary to implement policies in this regard?
Dr. Notis
I would like to begin by mentioning that Argen tina is a country that has known positive economic
development overall during the last decade.  However, the process has had a considerable economic cost
according to the Secretariat’s Report.  Unemployment has become a serious concern in recent years.
Would the Argentine Delegation please comment on and explain these developments in greater detail.
                                                     
1 The original text of the responses was submitted in Spanish.WT/TPR/M/47
Page 52
I would also ask the Argentine Delegation to comment on the subject of concentration of the economy and
whether it sees any relationship between this movement toward concentration and the increase in the
unemployment and poverty rates mentioned earlier.
What do the authorities intend to do about the problem of the fiscal deficit?
Could the Argentine Delegation present us with their evaluation, if possible, of the new prospects after
the devaluation of the Brazilian currency?
According to the information in the Secretariat’s Report, the eliminati on of imperfections in the financial
and labour markets and the diversification of exports could reduce the risks.  Could the Argentine
delegation please comment on this suggestion?  Last, we  would be very interested in having the Argentine
delegation present its views on the more general is sue of the sensitivity of  the trade and commercial
account balances.
With respect to the foreign debt, in 1999 we will use public credit to meet payment commitments
(capital falling due) and finance the fiscal deficit (net of the reduction in the stock of financial assets).
We will attempt to attract funds from the local market rather than international credit markets to
reduce the impact of future fluctuations or crises.
Our financing policy is based on rescheduling of loans, diversifying the investment base for the
capital raised by the Government and actively managing liquidity.
Argentina will measure and control risks stemming from fluctuations in the exchange and interest
rates by developing a liability management system with operations to cover financial risks and new
instruments.
Financing from international organisations
(b) (i) MERCOSUR:  multilateral trade objectives;  convergence;  trade diversion/creation;
"substantially all trade";  "reasonable length of time";  EU and FTAA negotiations
Ambassador Farrell
(Components of Trade Policy Strategy) What I would welcome is a more explicit indication of how the
various strands are seen, by Argentina, as knitting t ogether. Which are the main driving forces behind the
trade policy strategy?  The unilateral push was clearly a decisive one as part of the radical domestic
economic reform programme.  Have sub-regional econom ic imperatives overtaken unilateral ones?  We
are told that MERCOSUR is seen by Argentina as “... a platform for connecting to the rest of the world”.
How is this perspective and the MERCOSUR priority going to shape Argentina’s approach to setting its
multilateral trade liberalisation objectives?
Also, based on an economic history well known to me, I wonder, does a vision of an ideal trade
diversification pattern play a part in Argentina’s trade policy strategy formulation?
(Dialogue with the Private Sector) I wonder how the new Private Sector Advisory Council on Foreign
Trade operates and how it is working out?  And how has the response of the business community been tothe new Registry of Barriers to Argentine Exports?WT/TPR/M/47
Page 53
USA
What is the status of MERCOSUR’s efforts at re gional integration?  In what live negotiations does
MERCOSUR currently participate and what is the objective of these negotiations?
New Zealand
(S/47, Pt II(6), p. 29, paras. 45, 46, p. 31, para. 55) We are concerned that the increase in MERCOSUR’s
CET may lead to increasing trade diversion.  Do Argentina and its MERCOSUR partners have anymeasures in mind to combat this effect?
Norway
Regional Trade arrangements:  From the report of the Government of Argentina, we note that Argentina
is an active participant in regional trade arrangemen ts.  On page 13, second paragraph, of the report, the
Government has stated that with respect to regiona lism much remains to be done to complement and
confer consistency on the interaction between regiona lism and the multilateral trading system.  We would
appreciate if Argentina would expand its view in more detail as to what it feels remains to be done.
We further note that Argentina also is part of interregional cooperation.  What is the policy of Argentina
with respect to develop such cooperation further in substance as well as in respect of new participants?
Japan
Regional trade agreements signed between MERCOSUR  and its neighbouring countries includes some
provisions which seem to be not conformity with Article XXIV of the GATT.  For example, free-trade
agreement between MERCOSUR and Chile phases out th e internal tariff within 18 years in spite of
paragraph 3 of the "Understanding of the Interp retation of Article XXIV of the GATT 1994" which
provides that "reasonable length of time" to form a free-trade area should exceed ten years only in
exceptional cases. To add with, some preference arrangements within the LAIA members are not
consistent with Article XXIV:8 of the GATT which provid es that duties should be eliminated with respect
to "substantially all the trade".
It seems that these agreements, which are free-trade agreements between developing countries, are
concluded under the enabling clause. However, there has been no consensus on relationship between the
enabling clause and Article XXIV of the GATT.
As reported in the Secretariat Report, some other negotiations are under way to establish regional trade
agreements including developed countries such as th e FTAA and such RTAs should be established fully in
conformity with Article XXIV of the GATT. Could Argentina confirm that the establishment of FTAA is
being negotiated to be in full conformity with the WTO Agreements;  i.e. the duties and other restrictive
regulations of commerce are to be eliminated on substantially all the trade within ten-years? (para. 36
(p. 26), para. 50 (p. 30), para. 53 (p. 31))
Poland
MERCOSUR is negotiating at the same time trade li beralization with the European Union and in frame
of Free Trade Areas of the Americas. Please explain priorities of MERCOSUR policy in both
negotiations. Are there any discrepancies between the MERCOSUR members regarding this policy?
Thailand
The latest status/information on the preferential trade arrangements among members of the MERCOSUR,
particularly those which concerns Argentina.WT/TPR/M/47
Page 54
Japan
It is reported that the CET of MERCOSUR affected 65% of Argentina's imports from outside the region
or 70% of the tariff lines. Such low rate of coverage of the CET seems to be inconsistent with
Article XXIV:8(a)(ii) of the GATT which provides that duties should be eliminated with respect to
"substantially all the trade". Please explain Argentina's view on this point (para. 46, p. 29).
Australia
We would like to comment on the relationship between its regional and multilateral arrangements, with
particular emphasis on MERCOSUR’s performan ce so far, the FTAA and possible EU-MERCOSUR
negotiations.
- Is the possibility that Argentina may concede further preferential access to regional partners for
agriculture consistent with the multilateral trade liberalization Argentina has been proposing?
- We are aware of the arguments presented by MERCOSUR countries that MERCOSUR does not
divert trade but enhances trade.  Would Argentina be able to comment on a specific issue of concernto Australia – Australia used to export to Argen tina aluminia valued at more that AUD$100 million
annually.  Australia lost most of this market after the formation of MERCOSUR when Argentina
began to source its aluminia from Brazil’s under  preferential arrangements under MERCOSUR.
Costa Rica
Argentina’s exports to Latin America (excluding M ERCOSUR) have grown considerably.  However, the
same does not hold true of imports from those countries, even though the real exchange rate in Argentina
between 1992 and 1997 has remained virtually unchanged.  To what conditions or circumstances do you
attribute this phenomenon?
MERCOSUR
In view of the repeated mentions and consulta tions on issues related to MERCOSUR, we would
like to provide an overview of the integration process from Argentina’s standpoint.
From the time it was created with the signatur e of the Treaty of Asunción on 26 March 1991, and
even more so once the first stage in the trade liberalization programme, which removed the bulk of tariff
and non-tariff barriers to trade in goods among the members, was completed, the economic space
composed of Argentina, Brazil, Paraguay and Urug uay has become one of the most important regional
blocs in the world, attracting investors from all over.  MERCOSUR covers almost 12 million square
kilometres, has close to 200 million inhabitants and generates a gross product that is already over a trillion
U.S. dollars.
The Customs Union began on 1 January 1995, with the introduction of the common external tariff
(CET), which established a tariff with 11 brackets, ranging from zero to 20% and which will gradually be
made to converge until full coverage is reached on 1 January 2001.  The sole exceptions will be goods in
the information technology and telecommunications sector, which will be exempted until 1 January 2006.
The Customs Union will be refined in the period extending to the year 2005 by laying the
groundwork for a single market with free movement of factors and gradual harmonization of national
rules, particularly those that could affect the competitiveness of the respective economic agents.WT/TPR/M/47
Page 55
After the year 2005, nominal protection under the CET will be in the order of 12% and average
protection weighted by trade will be in the order of 11%.  The compatibility of the integration process
under MERCOSUR with WTO rule s is assured from the outset.  Neither the form nor the dynamics of the
economic events during the process have distorted trade and, in practice, imports from all origins into
each of the four member States continued to grow very quickly at the same time as trade among them
increased.  One key aspect of the definitions adopted in MERCOSUR is adherence to the principle ofopen regionalism, which means that the expected benefits of the integration process are not grounded in
discriminatory policies against the rest of the world, but are designed to be extended and to converge with
general multilateral liberalization.
Therefore, MERCOSUR has been, is and will co ntinue to be a dynamic player in deepening
relations with other countries and groups of countries elsewhere in the world.  The free trade agreements
with Chile and Bolivia, the negotiations under way with the Andean Community, participation in the
FTAA negotiations and the treaty with the European Union are clear examples of this active line ofdevelopment of MERCOSUR’s external relations.  The free trade agreements with Chile and Bolivia, in
particular, lay the groundwork for liberalization of trade in goods between the parties, which will be
completed within ten years for a substantial part of that trade.  The existence of exceptions that will be
liberalized over longer terms is completely compatible with the GATT 1994 provisions in that regard.
The absence of distortions stemming from the integration process is linked to the fact that the
member States are natural partners and to the fact that integration is being carried out under national
policies that include sweeping structural reforms to achieve liberalization, trade and financial openness,
deregulation and privatization, as well as more flexible regimes for foreign investors which offer them
greater legal security.  The dynamic effects that arose from the process, such as advances in efficiency
owing to greater complementarity in production and economies of scale, space and specialization, alsohelped to prevent distortions.
In the case of alumina, the situation described by the Australian Delegation may have occurred.
However, to reach a conclusion on whether or not trade diversion existed, an analysis would have to be
performed based on MERCOSUR’s trade with  the country in question (Australia).
As of January 1 of this year when Argentina and Brazil had concluded their adjustment regimes,
the tariffs still in effect for trade among the MERCOSUR countries affect a minimal part of the total
volume of that trade.  We have no intention of reversing this situation.
With respect to the coverage of the CET mentioned in the Secretariat’s Report, it should be noted
that this refers to the tariffs applied to trade with third countries and to the volume of that trade in 1995.
On 1 January 2006, the CET will cover all tariff headings and all trade with third countries.
(ii) Foreign direct investment; fiscal measures; incentives
Australia
Argentina has made impressive progress in the esta blishment of investment laws attractive for foreign
direct investments. However, there are a number of issues of concern to Australian companies:
(a) The Provinces do not always abide by or interpret the Federal Laws consistently, thus imposing
additional burdens on foreign investors not envisaged in the feasibility stages.  What steps, if any,
is the Argentine Government taking to minimize these discrepancies?WT/TPR/M/47
Page 56
(b) Under the guaranteed fiscal regime provided  under the Mining Investment Law (Act 24.196),
considerable foreign investment is already taking place:
- Does the new legislation proposed under the Tax Reform Bill now before the Congress
prejudice in any way foreign investment already in place by imposing new taxation
burdens not envisaged under the Fiscal Stability Regime of Act 24.196, particularly the
imposition of withholding tax payable on inte rest on foreign loans and withholding tax on
dividends payable to foreign investors?
- Does the imposition of new diesel fuel tax for the mine industry impose new burdens not
envisaged under the Fiscal Stability Regime under Act 24.196?
- Does the application of accelerated depreciation provision in Act 24.196 limited to the
first five years only, prejudice investments with large initial capital inputs, for example
mining investments, not earning profits in the first five years?
(c) Can Argentina outline its policies in relation to foreign participation in infrastructure projects.
Do foreign companies participating in infrastructure development receive national treatment in
Argentina?
(d) Does Argentina have any foreign investment rest rictions in relation to land  transport, civil
aviation or maritime transport services, and if so can Argentina advise whether there are plans to
liberalise those restrictions?
Norway
(Mining) From the Report of the WTO Secretariat (page 38, paragraph 84), we note that the Argentine
legislation guarantees several advantages for mining investment.  The general opinion of Norway is that
giving advantages to a specific sector is not positive for the overall economy.  Furthermore, we note that
to be eligible for the mentioned advantageous treatment individuals and corporations must be domiciledin Argentina.  Does Argentina plan to change this policy?
Costa Rica
Does Argentina have any policy to foster, subsidize or benefit new foreign investment?
Does the Invertir Argentina Foundation grant benefits of any kind to attract foreign investment to
Argentina?
The general treatment defined in domestic legislation is applicable to foreign participation and
investments in infrastructure.  The legislation guarantees equal treatment of foreign and national
investors.
The Invertir Foundation carries out promotional activities to attract foreign investment but does
not offer any direct benefits to investors.
In land, air and maritime transport there are certain conditions or requisites placed on foreign
investors wanting to establish companies in Argentina.
In the specific case of mining, the fiscal stability regime legislated in Article 8 of the Mining
Investment Act (Law 24196) establishes that companie s under the regime will not see an increase in the
total municipal, provincial and federal tax burdens considered when they presented their technical and
economic feasibility studies.WT/TPR/M/47
Page 57
To ensure that the general measures regulated in the Capital Gains Law do not affect the fiscal
stability regime guaranteed by Law 24196, complementary rules are being prepared with the assistance of
tax policy specialists.
The starting point is that the fiscal stability regi me is only applicable to the taxes that companies
are required to pay for their entitlement to carry out the mining activities covered by the Mining
Investment Act.
THE CAPITAL GAINS TAX is covered by the fiscal stability regime.  Accordingly, any taxes
levied on the dividends or profits that companies under the regime distribute to their parent companies,
owners or shareholders will not be charged on payments to foreign beneficiaries for profits earned from
Argentine sources.
The fiscal stability regime does not extend to the VALUE ADDED TAX or SOCIAL SECURITY
CONTRIBUTIONS which will be accorded general tax treatment.
With respect to the diesel fuel tax, a distinctio n should be drawn between the so-called special
fuel for mining (high cetane fuel oil) which is used in high mountain areas and on which no tax
whatsoever is charged, and gas-oil whose tax can be deducted from gains each year.
Owing to the nature of mining activities, ta x losses are common during exploration, construction
and the early years of operation.  Therefore the FU EL TAX deduction, since it must be claimed in the
same fiscal year in which the fuel was used, is ofte n not applicable.  Sector regulations are being drawn
up to enable companies to enjoy this benefit.
To ensure that the accelerated depreciation benefit established in Article 13 of Law 24196 can be
effectively used and not cancelled out in practice by the general rule (Article 19 of the Capital Gains Law
which permits the carry over of tax losses for just five years after they occur), a bill is being debated in
Congress, which has the support of the Mining Committee of the Chamber of Deputies and which, ifpassed, will provide a definitive solution to the subject of compensation for tax losses from taxable
earnings in future fiscal years.
II. TRADE MEASURES
(1) Single foreign trade law; notification; IDB
New Zealand
(S/47, Pt II(5), p. 25, para. 29) We note that a single foreign trade law (Draft Law 23101) has been
pending since the previous Trade Policy Review of Argentina, although some of its mechanisms have
begun to be put into place. Could Argentina provide an update on progress with this draft law?
Japan
Countertrade (paras. 72-74, p. 65) Please provide clea r explanation on the scheme of the countertrade.
Please explain the consistency of this scheme with the WTO Agreement.
Law 23101 was passed on 19 October 1984.  It established a comprehensive set of rules for
export activities, defining instruments and mechanisms that could be used.  Specific regulations wereWT/TPR/M/47
Page 58
required for the effective application of those mechanisms and instruments.  Regulations were introduced
for just part of those instruments and mechanisms and the ones that are still in effect were subject to
successive regulatory modifications to adapt them to the changes in economic policy.
Formally, the law remains on the books.  However, its content has become outdated because the
economic context has changed completely with the st ructural reforms carried out in Argentina starting
in 1989.
Decree 176/85 regulated one aspect of Law 23101 to enable trade operations to be carried out
without the use of foreign exchange, in a national and international context that was completely different
from today.  In practice, the system was never used and although the decree was never revoked, the
structural reforms in Argentine economic policy that were launched in 1989 and ratified in 1991 allow us
to affirm that no recourse will be had to operations of this kind in future.
Dr. Notis
Although Argentina complies with most of the regular WTO notification requirements, transparency
would be improved at the international level if WT O were informed more promptly about the introduction
or modification of trade measures.  I would ask the Argentine Delegation to provide us with a bit more
information on these points.
Canada
On WTO Notification Requirements: Chapter II, Section 5 (Trade Laws and Regulations), paragraph 32
states that "While Argentina has met most of th e regular WTO notification requirements, transparency
would be improved at the international level through prompter communication to the WTO of the
introduction or modification of trade measures."  What steps is Argentina taking to improve
communication with the WTO?
For our country, notification of trade measures in accordance with the provisions of the WTO
Agreements is an indispensable commitment for achieving the objective of transparency that flows from
the Agreements.
Argentina is aware of the notification requirements and periodically reminds the competent
authorities of their responsibilities in this regard in different areas/sectors.
Canada
On the Integrated Data Base (IDB): Based on the WTO document G/MA/IDB/2/Rev.3, which reports on
the status of submissions of the Integrated Data Ba se (IDB), Argentina has submitted its 1998 tariff but
has yet to provide any trade data.  Can Argentina c onfirm that it will be providing its 1998 trade data
before the September 1999 deadline?
Can Argentina confirm that it will be submitting its 1999 tariff before April 1999?
With respect to the question on the WTO Integrated Data Base, Argentina has just provided
information on trade for the years 1996, 1997 and 1998 (partial) and current import and export duties forinclusion in the data base.  Our intention is to present the complete trade data for 1998 and the 1999
tariffs within the deadlines.WT/TPR/M/47
Page 59
With regard to the loose-leaf system, our country is studying the possibility of preparing an
electronic loose-leaf schedule.  We are also evalua ting the possibility of obtaining technical assistance
from the Secretariat.
(2) Registration and documentation
New Zealand
(S/47, Pt III(2), p. 42, para. 9) We welcome the efforts of Argentina and its MERCOSUR partners to
integrate the information systems of their cust oms administrations.  When do Argentina and its
MERCOSUR partners hope to complete this process of integration?
(S/47, Pt III(2), p. 43, para. 12) We note the Secretariat’s concern that Argentina’s requirement of a
certificate of origin, stamped by the relevant Argentin ian Consulate, for imports of textiles, footwear and
clothing may cause delays and increase costs for exporters.  Does Argentina have any plans to remove
this requirement?
Canada
- As the WTO Secretariat Report points out in Chapter III, section 2, sub-section (i) (Registration
and documentation requirements), paragraph 12, delays and cost increases in importing are
being caused by the certificate of origin requirement.  Does Argentina plan to make modifications
to the requirement to address these problems?
- How does Argentina view the compatibility of its certificate of origin requirement with the
objective of facilitating trade by minimizing the incidence and complexity of import formalities
and decreasing and simplifying import documentation requirements?
- As noted in Chapter III, section 2, sub-section (ii) (Tariffs), paragraph 30, Argentina  maintains
non-preferential rules of origin.  For what purposes are these non-preferential rules of origin
used?
- Article 2(h) of the WTO Agreement on Rules of Origin provides for advanced assessments or
rulings on non-preferential rules of origin.  Can Argentina confirm that it provides such
advanced rulings upon the request of an exporter, importer, or any person with a justifiable
cause and that such assessments or rulings remain  valid for three years provided that the facts
and conditions under which they have been made remain comparable?
Hong Kong, China
(WT/TPR/S/47, p. 43, para. 12)  We are aware of the country of origin certificate requirement being
imposed by Argentina authorities on textiles, footwear and clothing since April 1996.  We have heard
reports that the same requirement may be expande d to cover toys from, among others, Hong Kong.  We
would welcome full and early cl arification of the situation.
Costa Rica
Are importers required by law to have a certificate of origin in their possession for merchandise at the
time they import it?
The requirements for presentation of certificates of origin and the application of rules of origin
respond to the provisions of the WTO Agreement on Rules of Origin regarding non-preferential trade.WT/TPR/M/47
Page 60
In the specific case of textiles, clothing and footwear, a certificate of origin is required for
statistical purposes, in accordance with Article 1 of the Agreement, in order to learn the origin of the
merchandise which, in the case of textiles and clothing in particular, may be the object of practices such
as those mentioned in Article 5, paragraph 1 of the WTO Agreement on Textiles and Clothing.
This requirement is not an obstacle to trade and is not intended to increase the costs for importers.
With respect to advanced rulings, we are studying ways of establishing them to respond to
justified requests (Article 2(h) of the WTO Agreement on Rules of Origin).
Also, as provided in Article 1 of the Agreement on Rules of Origin we require certificates of
origin for products subject to anti-dumping measures, countervailing duties and safeguards.
(3) Customs valuation, minimum reference prices; PSI
Canada
(On Customs Procedures) As noted in Chapter III, section 2, subsection (i), Argentina has made
significant steps towards simplifying and speeding up customs procedures.  What further steps isArgentina planing to modernize/improve further it s customs and importation procedures in order to
facilitate trade?  For example, what is Argentina's view of the following approaches for facilitating and
expediting the cross-border movement and early rele ase of goods from customs:  moving from
transaction-based control procedures to audit-bas ed and risk-assessment-based controls; pre-arrival
processing of import documentation and related matters; post-entry duty and tax collection andacceptance of payment guarantees, such as bonds instead of deposits; and advanced rulings on tariff
classification and applicable duties and taxes.  Are any of these approaches included in the legislation
that is being developed on custom clearance referred to in Chapter II, section 5, paragraph 30?
With respect to the question on customs procedures, the legislation referred to is an amendment to
the Customs Code (Law 22415) which sets out the basic rules for the functions of the customs
administration and for facilitating foreign trade operations, exports and imports.  The legislative
amendment does not reflect the changes introduced in the Argentine National Customs Administration
since 1992 to promote and implement a sweeping operati onal and structural reform, beginning with the
computerization of customs procedures.  The Maria Sy stem was installed in the country’s main customs
but encountered a series of difficulties owing to the regulatory and organizational changes that weretaking place at the same time.  Today the system covers the main customs posts and will be extended to
cover them all next year.
To boost resource-management efficiency, in 1996 the Argentine government decided that the
agencies responsible for tax collection would be combined into a single body under the Ministry of the
Economy.  As a result, the Federal Public Revenue Administration was established, which includes the
Directorate General of Taxation and the Directorate General of Customs.
The objectives of simplifying customs operations, improving the system’s efficiency and
lowering costs for foreign trade operators are being achieved as the process of structural reforms in the
Argentine economy is consolidated and deepened.
USA
- As Argentina is aware, the establishment of price bands or ranges, and any other reference price
mechanism is not provided for under the Cust oms Valuation Agreement.  What plans areWT/TPR/M/47
Page 61
underway to eliminate recourse to such mechan isms?  Has there been any resolution of the
June 1997 concern expressed by Korea (G/C/M/20) of Argentina’s price verification scheme?
- Charges Other Than Import Duties Affecting Imports Only:  We understand that in Argentina,
merchandise handling and storage fees are determined by weight as opposed to value.  According
to the information provided, container handling fees seem to differentiate between imports and
exports.  The maximum rates applied for loading containers for export  were reported as being12% lower than those applied for unloading impor ted containers.  Could Argentina explain why
container handling fees vary between exports and imports?
Norway
According to the Secretariat’s Report (page 57, paragraph 48) container handling fees seem to
differentiate between imports and exports; the maximum rates applied for loading aboard containers
(exports) are 12% lower than those levied for unloadi ng them (imports).  My delegation would appreciate
some information about the reasons behind this difference in fees.
Japan
(Customs Valuation) In February 1997, Argentina in troduced new measures regarding customs valuation
for consumer electronics, which almost actually determines price of the imported goods according to
reference price.  These measures are said to aim at avoiding under-invoice.  However, if declared value is
below the reference price, deposits equivalent to customs duty and value added tax are required.Investigation for adequacy of declared value needs as long as 120 days.
- What are the criteria to judge whether the declared value is adequate?
- Such scheme, if applied in a discretionary manner, may be inconsistent with Article 7:2 of the
Customs Valuation Agreement which prohibits determining customs value on the basis of
"minimum customs values".
Please explain why such scheme is consistent with the WTO rules.
The reference price is in principle determined as the sum of the basic price of that product and the
additional price for each function and it varies according to country of origin and manufacturer.
- On what basis does Argentina determine such reference price?
- Reference prices are sometimes established for products which mentioned manufacturers do not
produce.  Is not this against Article 7:2 of the Customs Valuation Agreement which prohibits
determining customs value on the basis of "arbitrary or fictitious values"?
In most cases, reference prices of imported goods from Japan are increased by 15%.
- Is not this against the MFN principle?
European Union
How is the preventive mechanism concerning under- or over-invoicing designed to avoid disturbing
transactions at normal market price levels?  In other words – how does Argentina guarantee that theapplication of the preventive mechanism will not result in arbitrary minimum import price requirements?WT/TPR/M/47
Page 62
Price ranges for a series of products have been introduced in the customs administration for the
purpose of comparing the invoiced prices presented by importers when imported merchandise is finally
cleared for sale on the Argentine market.  This mechanism was used prior to the introduction of the
pre-shipment inspection system in November 1997 and is only maintained to enable the customs
authorities to compare the prices of goods imported from different origins.
Making price comparisons is not contrary to the provisions of the Agreement on Customs
Valuation which interprets Article VII of GATT.
With respect to the questions on the operation of Argentine port terminals and the prices or rates
charged by companies holding concessions to operate in the port of Buenos Aires, the decisions by the
companies regarding the rates they charge for handling and transporting containers do not reflect
definitions or decisions by Argentine government authorities.
USA (On PSI)
- In the year that Argentina has had preshipment inspection in effect, what has been the overall
assessment of its effectiveness?  How does the Government of Argentina intend to prevent undue
delays in processing?  Does Argentina still plan to reevaluate its reliance on PSI services after
two or three years?
- We note that the inspection commission charged by  the PSI companies is 0.8% of the f.o.b. price
of the goods, plus 5% of the amount of increase in tax collection.  This seems like a recipe for
finding undervaluation in every invoice.  Could the Government of Arge ntina please comment on
the possibility of restructuring its arrangement with the PSI companies so that the inspection
commission and bonuses are not calculated on an ad valorem basis?
- According to Resolution 1106 (effective October 1, 1998 and in force), the minimum order value
requiring a preshipment inspection was lowered from $3,000 to $800 for 1,820 tariff lines.Could Argentina please explain why the Argentine PSI regime was made more stringent after less
than one year in operation?
Canada (On PSI)
- With reference to Chapter III, section 2, sub-section (iii) (Customs valuation and preshipment
inspection), paragraphs 42 and 43, what criteria are being used to determine the terminationdate of the temporary measure of preshipment inspection?
- Can Argentina provide an estimate as to when the temporary measure will be terminated?
- Canadian companies have reported that the minimum value of merchandise affected by the
preshipment inspection has been lowered from  US$3,000 to US$800.  Can Argentina confirm this
modification and whether this has been communicated to the WTO?
Poland
In November 1997 Argentina introduced a preshipm ent inspection of merchandise (1,820 items) to
combat tax evasion, contraband and underinvoicing.  A ccording to our experience this measure distorts
Polish export to Argentina causing additional costs and bureaucratic formalities.  Does Argentina intend
to review the application of this measure in order to facilitate trade flow to this country?WT/TPR/M/47
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Hong Kong, China
(WT/TPR/S/47, pp. 54-55, paras. 42 and 44) We note th at PSI became effective on a temporary basis
since November 1997.  It was also mentioned that PSI services were to be privately run for a period of
two to three years.  Would the Argentine Government share with us its long-term policy and plan on PSI?
Hungary
Paragraph 14 of the addendum to the Secretariat Report informs us that the PSI regime of Argentina was
modified in October 1998 to the effect that the insp ection costs covered were raised to 0.95 ad  valorem
or a minimum of US$120 per shipment. We would be in terested to learn more about the reasons behind
the application of an ad valorem charge and also about the reasons necessitating these modifications.
Mexico
How has the programme functioned in practice?
How many companies have been inspected?
Has this become a non-tariff barrier?Do you plan to retain the programme for a given time and then eliminate it or has it been implemented as
a permanent programme?
Do you expect to increase or reduce the tariff universe subject to this measure in the short, medium and
long terms?
Do you intend to introduce a challenge procedure for importers and exporters in respect of the actions of
inspection companies?
What control do you maintain over the inspection companies?
The preshipment inspection programme established in Decree 477/97 is in effect for shipments of
merchandise made after 29 November 1997.
The programme has the following objectives:(a) To detect and combat under- and overinvoicing, erroneous classification and shortfalls in
declarations of quality and quantity of imported merchandise, and to stem tax evasion as
a result of such practices.
(b) To combat unfair competition to domestic industry by undervalued or overvalued
imports.
(c) To improve application of the methods for valuation and verification of imported
merchandise used by the customs service and the collection of statistics on categories of
foreign trade transactions through the introduction of a programme involving technology
transfers, physical equipment and training for customs personnel, with the cooperation of
the inspection companies.WT/TPR/M/47
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(d) To promote observance of customs and tax regulations and to streamline import
declaration processing through the reduction or elimination of erroneous or inexact data
in declarations.
(e) To improve quality controls and compliance with technical specifications by imported
merchandise and with expiry dates for perishable goods.
The programme was implemented in the framework of the Agreement on Preshipment Inspection
and its provisions form an integral part of the decree under which it was established.
Through international public bidding, the Argentine Government qualified six companies to
provide the services, a number which was believed to be sufficient to ensure that importers could chose
freely.  The cost of the service provided by the sele cted specialized companies is paid by the Government
and does not entail any outlay for importers or exporters.
The commission charged by the PSI companies is set at a percentage of the f.o.b. value declared
in each inspection certificate for the merchandise covered by the programme and the additional amountestablished to increase customs revenues has been removed (Resolution 1106/98 of 28-9-98).  This
ensures that there are no incentives for overvaluation.
Resolution 1106/98, which was duly notified to the WTO, expands the coverage of the
programme to consumer goods and automobiles whose prices range between $3,000 and $800.  When the
programme was introduced, the original intention was not to inspect imported goods worth less than$3,000 but this led to segmentation of high value merchandise into different parts so that each part was
worth less than the threshold.  The statistics showed very different behaviour in customs revenues
between goods subject to PSI and goods worth less than $3,000 that were not subject to PSI, which
explains the decision.
The preshipment inspection programme for imports is designed as an essentially transitory
instrument, whose life will depend on its achieving its objectives.  The Argentine Government intends to
replace the programme by exclusive inspection by customs, as the procedures for valuation and
verification of imported merchandise used by the customs service improve.
The programme is rooted in the larger objective of guaranteeing free trade.  Strict compliance
with the rules of the Agreement on Preshipment In spection is ensured through dual control of the
companies involved:  an independent audit performed by a private company selected through
international public bidding and an examination by the Auditor General of Argentina who reports to the
nation’s president.
It should be underlined that Decree 477/97 provides for strict sanctions for PSI companies in
addition to suitable administrative procedures that impor ters can turn to in disputes with the companies or
with the implementing authority, through a joint dis pute settlement committee.  Notwithstanding, out of
over 100,000 certificates that have been issued, only about 100 complaints have been received, mostlyregarding lack of information for importers, and no complaints have been filed on account of delays.WT/TPR/M/47
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(4) Tariffs:  stability;  3 percentage points te mporary increase;  bindings; HS96;  exceptions to
CET;  rates on capital goods
Dr. Notis
First of all, I would like to point out that tariffs bound at a maximum of 35% are generally higher than
the tariffs actually applied.  I therefore have a general question relating to the future (page 48,
paragraph 2).  Since Argentina supports a broad and full process of negotiations in 2000, I would like toknow whether the authorities plan in future to bind ta riffs at a lower level, for example to the CET levels
of MERCOSUR.
My second question is related to the application of higher duties on most capital goods.  In March 1995,
Argentina raised the tariffs on most capital goods  and on computer and telecommunications equipment to
contribute, among other things, to counteracting the fiscal deficit (page 53, paragraph 21).  Don’t you
think that measures of this type could have an adverse effect on investment and industrial production?
Hungary
Paragraph 12 of the Summary Observations and paragraph 49 of Part III of the Secretariat Report refers
to the ad valorem statistical tax charged only on imports from non-MERCOSUR countries. Welcoming
the reduction from 3% to 0.5% over a year ago we would be interested to know what is the legal basis for
the measure and the exemption of free trade partners and also if the government intends to further reduce
or eliminate this tax.
USA (tariffs)
We note that MERCOSUR raised its common external  tariff in November 1997.  Could Argentina please
explain why this step was taken and how it was implemented by Argentina and the members of
MERCOSUR in light of Argentina’s and the pact’s WT O obligations?  Has this change now been notified
to the WTO?
New Zealand
(S/47, Pt III(2), p. 45, para. 21) How do Argentina and its MERCOSUR partners envisage that the
temporary increase of MERCOSUR’s CET by 3% will affect MERCOSUR’s long-term goal of tariff
reduction and trade liberalisation?
Norway (tariffs)
According to our information Argentina has increased their import tariffs on used means of transport
(including used boats) from 15% to 25% in 1995 and further to 28-30% in 1998.
Norway exports a substantial amount of used fishi ng boats to Argentina.  We would therefore like to
obtain information regarding the reason behind these high tariff rates as well as an indication of their
future status.WT/TPR/M/47
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Canada (from Government Report)
- With reference to section 3.2 (Argentina in MERCOSUR), what is the extent of Argentina's
exemption of agricultural products from MERCOSUR internal tariff elimination?  What are the
major agricultural products exempted by Argentina from MERCOSUR internal tariff elimination
and what is the level of trade that may be affected by these exemptions?
- Has Argentina begun work on preparing its electronic loose leaf schedule?- Does Argentina plan to take advance of the technical assistance offered by the WTO Secretariat
in preparing its electronic loose leaf schedule?
- Given the importance of information technolo gy goods as major inputs to economic growth,
adjustment, and development, as well as in world trade, will Argentina consider joining the
Information Technology Agreement?  If not, please indicate why?
Hong Kong, China
(WT/TPR/S/47, p. 29, para. 46)  We note that a temporar y increase of the CET by 3% on most tariff items
was agreed in December 1997 to accommodate Brazil’s external imbalance and allow Argentina to
reduce the level of its statistical tax.  Given that a customs union should be contributing to the continued
process of trade liberalization and that the increase is said to be temporary, we would like to know when
Argentine Government will remove the increased tariffs.
(WT/TPR/S/47, p. 32, para. 55) It is mentioned that “the share of MERCOSUR-origin imports for certain
items that benefit from increased border protection against MFN sources has increased markedly
(e.g. footwear and office machines)”.  We would like to know the details of the “increased border
protection” in the sectors concerned and the ac tual benefits MERCOSUR-origin imports derive
therefrom.  Does the protection refer to merely  the gap between the MERCOSUR and the MFN tariff
rates or other more specific restrictive import measures?
Australia
- Will the world financial crisis have an effect on the elimination of tariff protection on imports of
sensitive items, now excluded from MERCOSUR ’s Common External Tariff, as originally
scheduled to be eliminated by the end of 1998?
- As a result of the crisis, several industrial sectors have been lobbying to raise the MERCOSUR’s
Common External Tariff (CET), as well as duties on sensitive items.  What is Argentina’s position
on this proposal?
Japan
- Argentina and other MERCOSUR countries have raised the CET by 3% at the end of 1997.  Is
not this measure against the spirit of Article XXIV:4 of the GATT which provides that the purpose
of a customs union or a free-trade area should not be "to raise barriers to the trade of other
contracting parties with such territories"? (para. 46, p. 29)
- Are there any products the CET rates of which exceed Argentina's bound tariff rates?  If so, it is
inconsistent with Article II of the GATT to raise tariff rates without conducting Article XXIV:6
negotiations.  Please explain Argentina's view on this point.
- Although Argentina has adopted the HS96 classifi cation since 1 January 1996, Argentina has not
completed its modification of its Schedule to introduce HS96.  Argentina obtains waiver whichsuspend the application of the provisions of Article II of GATT 1994 until 30 April 1999.  Please
explain the prospect for completion of the modification of its Schedule (para. 18, p. 44).WT/TPR/M/47
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- It is reported that applied rates for automobiles,  temporarily exempt from convergence, are much
higher than those in the CET. When does Argentina expect to converge the tariff of automobiles
to the MERCOSUR CET? (para. 23, p. 46)
- Are there any exceptions to the MERCOSUR CET other than those listed in Table III.1 (p. 47)?
European Union
At the end of 1997, the Argentine Government raised most of its tariffs by 3% in compensation for the
reduction of its statistical tax.  When will this measure be removed?
Costa Rica
What, specifically, are the special customs regimes in  effect in Argentina, how do they operate and what
incentives do they offer the beneficiaries?
The 3% increase in the CET is a temporary measure that will expire on 31 December 2000.
However, it should be noted that even with this temporary 3% increase, the CET is far below the bound
tariff levels of the member States of MERCOSUR in the WTO.
Paragraph 55 of the Secretariat’s Report refers to protection stemming from the difference in
MFN tariffs and intra-regional tariffs.  However, the Secretariat’s document notes that the impact on
Argentine imports from MERCOSUR sources was not as pronounced as on exports from our country to
that destination.  The document notes that the impact was limited to certain categories of products and
was not generalized.
One of the questions appears to refer to the so-called adjustment regime that permitted Argentina
to maintain tariffs on our trade with MERCOSUR c ountries for 200 headings.  As was agreed, the regime
concluded on 31 December 1998.  If the question also refers to convergence with the CET by national
tariffs that were above the CET level, th e timetables are also being complied with.
The position of the Argentine authorities is that the CET should not be modified.  In
MERCOSUR, there is the possibility of using comm on instruments to deal with particular cases of
imports of sensitive products that could injure  domestic production.  MERCOSUR has common rules on
safeguards for imports from third countries a nd a regulatory framework for the application of
anti-dumping measures.  Argentina has domestic legislation for the application of safeguards and
anti-dumping and countervailing duties.
The list of products for which the CET is higher than Argentina’s bound tariff covers only a small
number of tariff headings and a small volume of trade.  It was presented and notified to the Committee on
Trade and Development with the objective of beginning negotiations in the framework of Article XXIV.6
of the GATT 94.
The modification of National Schedule LXIV to reflect the changes in nomenclature pursuant to
adoption of the 1996 version of the Harmonized System was presented promptly to WTO’s Committee
for Market Access.  The waiver exists because some members of WTO consider that they cannot acceptthe modification in its current state and therefore they keep it subject to review on the basis of a
reservation of their rights.WT/TPR/M/47
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As agreed by the member States of MERCOSUR, a common regime for the automotive sector
will enter into force on 1 January 2000, and a CET will be defined for the sector.
The only exceptions to the CET are those cited in Table III.1 of the Secretariat’s Report.  There
are actually fewer exceptions than appear in the report, since those corresponding to the adjustment
regime ceased to exist on 31 December 1998.
(5) Anti-dumping and countervailing measures
Norway
According to the Secretariat’s Report (page 75), Argentina was among the seven countries with the
highest number of anti-dumping cases initiated each year between 1991 and mid-1997.
Has Argentina undertaken any analysis of the national negative effects resulting from these measures?
Does Argentina consider it necessary to continue to use anti-dumping measures in the future?
Canada
- Chapter III, section 2, sub-section (xiv) (Anti-dumping and countervailing measures),
paragraphs 104 and 105 indicate that Argentina has been a heavy user of anti-dumping action
since 1991, particularly in the sectors of metals, chemicals, and electrical and electronic goods.
What accounts for this sharp increase in the use of anti-dumping measures?
- With reference to paragraph 109, under the inte rim framework, will the common anti-dumping
regulations being developed for MERCOSUR  treat dumped imports originating from
non-MERCOSUR countries the same as those originating in MERCOSUR countries?
- Under the proposed common anti-dumping regulations, will actions based on a complaint from
an industry in one MERCOSUR country result in a region-wide application of duties?  Will this
be the case even when other MERCOSUR countries do not produce the product?
Australia
We understand that the National Foreign Trade Commission was formed to oversee cheap imports
entering Argentina as a result of recent substantial devaluation of currencies in the Asian region.  Would
Argentina please provide a brief review of the Na tional Foreign Trade Commission’s performance so far,
and the Government’s plans, announced on 9 October 1998, to accelerate investigations for safeguards
and countervailing duties?
European Union
Whilst Article 5.10 of the WTO Anti-Dumping Agreement requires the conclusion of an anti-dumping
investigation, at the latest, 18 months after initia tion, Argentina’s anti-dumping legislation does not
appear to contain a time-limit for the completion of investigations.
On a recent question in this respect within the context of the WTO Anti-Dumping Committee
(G/ADP/W/286, p. 50), Argentina indicated that, in this regard, “Article 5.10 of the Anti-Dumping
Agreement applies”.  However, in several cases Argentina has exceeded such limit. Such cases includethe proceedings concerning drill bits from Italy, where definitive anti-dumping measures were imposed
after 18 months from initiation, and those concerning op tical fibre cables from Spain, the U.S. and Brazil,
where the investigation is not yet conclude d, after over 20 months from initiation.WT/TPR/M/47
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- How does Argentina explain conformity of these cases with the requirement contained in
Article 5.10 of the Anti-Dumping Agreement?
- How and when does Argentina intend to withdraw the measures imposed on drill bits from Italy?
- How does Argentina intend to ensure that in the future this compulsory time limit is respected in
all cases?
(On countervailing measures)
- Resolution 417/97 of April 11 establishes a maximum term for the countervailing duties
established in Resolution 100/96 of the Ministry of Economic Affairs and Public Services on
imports of tinned peaches from non-MERCOSUR countries.  Does Argentina plan to remove
these duties before five years have passed?
- Resolution 772/98, of July 2 establishes countervailing duties for two years on bottled and bulk
olive oil from the European Union.  Since, in the opinion of the EU, the investigation has not
complied with all the requisites of the Agreement on Subsidies and Countervailing Measures,does Argentina plan to review these countervailing duties before the period expires?
USA (Anti-dumping)
The Anti-Dumping Agreement requires Members to  complete anti-dumping investigations within
18 months.  Could Argentina explain how it complied wi th this obligation in its investigation of imports of
fiber optic cable from the United States, the European Community and Brazil?
Czech Republic
Could the Argentine Delegation comment in more deta il on its list of antidumping measures?  Does it
view their heavy use as directly proportionate to the liberalization process?
The use of anti-dumping measures runs parallel to the policy of openness and cannot be
considered a “sharp increase”, unless the measures are compared with a base period in which theeconomy and imports were subject to greater protection and control.
The main thing is that the application of anti-dumping measures has always complied with the
legal requirements, particularly the requirement of due process.
The regulatory framework in effect in MERCOSUR does not affect the application of domestic
legislation.
The future common regime will be studied by the member States prior to 31 December 2000.
The National Commission on Foreign Trade (CNCE) was established in 1994 under Decree 766
“to investigate and analyze injury to domestic production caused by imports made under unfair
competition” (Article 3(a)), “and to study the injury  that an increase in imports could cause to domestic
production and evaluate the advisability of introducing safeguards” (Article 3(b)).  The performance of
the commission can be verified in the notifications made by our country to the Committees on
Anti-Dumping Practices, Subsidies and Countervailing Measures and Safeguards.
The reference to the announcement of a plan to speed up investigations appears to be related to
the promulgation of a new decree regulating th e Agreements on Anti-Dumping Measures and onWT/TPR/M/47
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Subsidies and Countervailing Measures which form part of Law 24425 that incorporates the Uruguay
Round agreements into domestic legislation.  Decr ee 1326/98 of 10 November 1998, amended the earlier
regulations contained in Decree 2121/94 and established shorter deadlines for the different stages in the
process, which run from submitting an application for an investigation until the close of the investigation,
in the event that one is conducted.
With respect to the questions regarding Article 5.10 of the Anti-Dumping Agreement, the
Agreement is included in Argentine legislation under Law 24425 and its regulatory Decree 1326/98
(10/11/98, published in the Official Gazette on 13/11/ 98).  Both have been notified to the Committees on
Anti-Dumping Practices and Subsidies and Countervailing Measures.
The mention that “in several cases” Argentina has not complied with the requirement to conclude
investigations within a limit of 18 months (under Article 5.10) is incorrect.
The case of drill bits imported from Italy is the subject of a request for consultations submitted by
the EU under Article XXII of the GATT 94 and Article 4 of the Dispute Settlement Understanding.
The case of optic fibre cables was concluded under Resolution MEYOSP Number 1578/98 of
15 December 1998, and no measures of any kind have been taken with respect to imports from Spain.
With regard to the questions concerning Resolutions MEYOSP 417/97 and 772/98, elimination of
the duties before the five-year period is up will depend on how imports behave and on the results of
reviews that may be performed before the end of th at period, if reviews are requested under current
legislation.
(6) Safeguards:  footwear
Japan
(Para. 112, p. 78) Argentina has applied safeguard measures against imports of footwear products.
Although MERCOSUR countries were the main sources  of the rapid increases in footwear imports and
imports from non-MERCOSUR countries are declini ng, the safeguard measures were imposed on imports
from non-MERCOSUR countries. Is not such meas ure inconsistent with the Safeguard Agreement?
Republic of Korea
The Secretariat’s Report stipulates in paragraph 112 of page 78 that Argentina has applied safeguard
measures in the form of minimum specific duties against imports of all footwear products except ski-bootsand snowboards.
Recently the Argentina authorities extended the application of such duties on developing countries with
low import shares on the basis that developing c ountries with less than 3% import share collectively
account for more than 9% of total imports of the product concerned.
It is known that multinational footwear manufacturers such as Adidas and Nike which are members of
Argentina’s association of footwear producers and importers are exempted from  the application of such
duties.
How does Argentina Government ensures that this WTO provision is applied on an MFN basis and
consistent with the WTO provisions such as provisions relating to non-preferential rules of origin?WT/TPR/M/47
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USA
- We have serious concerns about the modification of the Argentine footwear safeguard through
Resolution 1506, put forth by the Argentine Ministry of Economy in November 1998.
- Pursuant to this Resolution, the Government of Argentina delayed all scheduled liberalizations of
the safeguard duty until only two months before its termination in February 2000 and imposed a
quota on top of the already existing safeguard duties.  This action appears to contradict therequirements of Article 7.4 of the Safeguards Ag reement, which states that WTO members “shall
progressively liberalize [the measure] at regular intervals during the period of application”.
- This Argentine footwear safeguard measure has not been liberalized, and in fact has become
more stringent, since the measure was imposed provisionally in February 1997 and finally
in September 1997.  We welcome comments by the Government of Argentina regarding how a
measure that strengthens rather than liberaliz es the terms of a safeguard can comport with
Article 7.4.
- In September 1998, the Argentine National Foreign Trade Commission (CNCE) concluded its
safeguard investigation on toys, resulting in a unanimous determination by the CNCE that no
injury was suffered by the Argentine toy industry.
- However, we understand that a draft decree is close to approval that would impose new, higher
customs duties on imported toys.  Is this actually the case?
- We are concerned that the Government of Argentina would consider drastically raising tariffs on
these items, particularly given the recent CNCE determination that the industry has suffered no
injury from imports.  What would be the WTO rationale for such a tariff increase?
- Could the Government of Argentina please detail the status of efforts in MERCOSUR to develop
a common safeguards regime?
European Union
- It appears that the Minister of Economic Affairs has decided to apply specific duties on dolls and
plastic toys weighing not more than 1.2 kg per unit.  Is that the case?  If so, what is the basis for
this safeguard measure, given that the National Foreign Trade Commission determined in
October 1998 that no real or potential injury to the Argentine industry could be demonstrated?
- In cases where Argentina initiates a safeguards investigation, how does it intend to deal with
imports from other MERCOSUR countries?
- Would imports from MERCOSUR countries be subject to any possible safeguard measures
adopted or would they be excluded from the scope of such measure?
- In case MERCOSUR imports were excluded from the scope of the measures, would such imports
be accounted for in the determination of the existence of “increased imports” pursuant to
Article 2.1 of the Agreement on Safeguards?
- Similarly, in case MERCOSUR imports were ex cluded from the scope of the measures, would
such imports be accounted for in the determination of “serious injury” caused by increased
imports pursuant to Article 4 of the Agreement on Safeguards?
- Finally, would MERCOSUR imports be accounted for in the determination of “critical
circumstances” for the establishment of provisional safeguards measures pursuant to Article 6 ofthe Agreement on Safeguards?
With respect to the safeguard applied to footwear, the nature of these questions is closely linked
to the case already mentioned, which was submitted by the European Union disputing the safeguard
applied by Argentina to imports of footwear (WT/DS121/3).WT/TPR/M/47
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A panel is studying the case and it is not appropriate to discuss it before the procedure has
concluded.
Argentina decided to apply a safeguard against imports of footwear after conducting an
investigation as provided for in the Uruguay Round Agreement on Safeguards and domestic legislation.
The measure adopted under Resolution MEYOSP 987/97 has been questioned by the EU under the WTO
Dispute Settlement Understanding and is currently being dealt with by a panel that the Dispute SettlementBody decided to establish in July 1998 (WT/DSB/121/3).
In the case of toys, the Ministry of the Economy is studying the application of specific duties
under Article 667 et seq. of Law 22415 (the Customs Code).  If specific import duties are applied in
future, this will be done within the limits established by the tariff commitments undertaken by Argentina
as they appear in National Schedule LXIV.
(7) Standards, sanitary and phytosanitary
USA
- Marking, labeling and packaging:  We note that during the customs clearance process, imported
goods are inspected for country of origin markings.  It is indicated that a country of origin
“special ruling” is maintained for products such as potatoes, fresh fruits and vegetables, dried or
preserved fruits and nuts, and several other products.  If all products are not subject to country of
origin “special rulings” could Argentina provide a comprehensive list of those products that are?What criteria are used to determine products that are inspected according to these “special
rulings"?
- Could the Argentine delegation please comment on efforts within MERCOSUR to harmonize
standards and other technical requirements?
Japan
Standards and other technical requirements (para. 89, p. 72)
It is reported that "special rulings" on marking affects various products.  Please provide explanation on
"special rulings".
Republic of Korea
- The Argentine Government announced in September 1998 its plan to change its standards system
on electric products to a system based on authorization from August 1999.  According to this
plan, home electric appliances can be imported only after having successfully passed the safety
test by the Argentine Standards Institute.
Did the Argentine Government notify this plan to the WTO Committee on TBT?
- Paragraph 79 in page 69 of the Secretariat Report mentions that Argentina maintains bilateral
product certification agreements with certain countries and quality system certification
arrangements are in force with certain countries.
What’s the policy orientation of Argentina with respect to these agreements?  Is Argentina considering
expanding such kind of bilateral agreements and certification arrangements with other countries?WT/TPR/M/47
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New Zealand
(S/47, Pt III(2), p. 69, para. 77) We welcome the development of standards according to international
guidelines by Argentina.  What measures does Argent ina have in place to ensure standards are not in
effect technical barriers to trade?
(S/47, Pt III(2), p. 71, para. 87) We note that Argentina has signed a declaration of intent to negotiate a
mutual recognition agreement with the European Co mmission on sanitary and phytosanitary regulations.
Does Argentina envisage also entering into negotiations with other countries on such mutual recognition
agreements?
Poland
Sanitary and phytosanitary regulations are applied in some cases with excessive rigidity. It takes several
months for the Argentinian importer of Polish f oodstuffs and alcoholic beverages to obtain necessary
certificates.  In 1996 Argentina signed with the European Union the declaration of intent to conclude
negotiations for a mutual recognition agreement on sanitary and phytosanitary regulations.  Are thereany intentions of Argentina to conclude the similar agreements with other countries?
Costa Rica
Has the private sector been allowed to play a greater role in carrying out these activities on its own,
specifically with respect to animal and plant health (vaccinations, laboratories, training, and extension)?
With respect to foot-and-mouth disease, particularly the institutional details, President Carlos
Menem signed Decree 1324/98 on 10 November 1998, whic h “prohibits as of 30 April 1999, vaccinations
against foot-and-mouth disease of any susceptible species anywhere in Argentine territory and the entry
into the country of vaccinated animals”.  This decree empowers SENASA to take all necessary steps to
prevent re-entry of the disease and to deal with any focuses that might appear.
Argentina has not signed the agreement with th e European Union referred to in one of the
questions.  It should be clarified that our country intends to reach mutual understandings that respect the
principles of the SPS Agreement with all its trading partners.
In this spirit, the National Administration of Food Health and Quality (SENASA) is making every
effort for closer international cooperation in sanitary and phytosanitary matters.  It has signed several
agreements with different countries.  They include, but are not limited to:  the Cooperation andCoordination Agreement on Health and Plant Quarantine and the Zoosanitary Agreement with Peru
(11-12-98), Agreements on Animal and Plant Health with Jamaica (December 1998), Agreement on
Procedures to Guarantee the Sanitary Quality of Exported Fish Products between the Department of
Agriculture, Livestock, Fisheries and Food and the Mi nistry of Fisheries of Cuba, the Bilateral Agreement
between Argentina and Chile and the Memorandum  of Cooperation between SENASA and the Animal
and Plant Health Inspection Services (APHIS) of the United States, among others.
The requirement for country of origin markings on packaging is a normal requirement in trade in
commodities, which facilitates trade flows and avoids uncertainties that would hamper efficient trade.WT/TPR/M/47
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(8) Government procurement
USA
- As an observer to the Committee on Government Procurement since April 1997, has Argentina
given further consideration to joining th e WTO Plurilateral Agreement on Government
Procurement?
- Does the domestic legislation relating to gover nment procurement also apply to government
concessions?
- To what extent does the domestic legislatio n relating to government procurement create a
mechanism for the review of proc urement awards and procedures?
- Are instances in which direct contracting (as opposed to open or selective tendering) is permitted
clearly prescribed in domestic legislation, or is it left to the discretion of the procuring entity?
- Paragraph 92 states that, “[i]n case of equality of bids, preference is given to suppliers of
domestic goods and to local bidders for services and public works contracts”.  What is meant bycases of “equality of bids”?  Does this just refer to equality of price, or to other factors as well?
- Paragraph 92 states that there is no requirement (except in the area of telecommunications) for
the use of a preferential margin favoring domes tic companies.  Under what circumstances are
such measures permitted but not required?  Is the existence of such measures in the context of
particular procurements made known in tender documentation?
- Paragraph 98 refers to mandatory controls over procurement by the National Administration of
the Office of Auditor-General (SIGEN).  Please describe the mandatory controls referred to in
this paragraph.
European Union
- Does the MFN principles apply, at least in practice, to Argentina’s procurement policies and
practices?
- Are foreign firms permitted to participate in all goods and services contracts?  On equal terms
with Argentine firms?
- Are foreign firms permitted to participate in public works contracts? If so, are any conditions
attached to their participation (for example, are they also required to enrol in the National
Register of Public Works?)?
- Is enrolment in the National Register of Public Works possible at any time, including after a
tender notice has been published?
- Can Argentina confirm that, as paragraph 97 of the Report seems to imply, sub-central
authorities are also subject to the policy- and ru le-making of the National Procurement Office, or
do sub-central authorities have autonomy to determine their own pr ocurement policies and
practices?
Norway
We note that Argentina is not a member of the WTO Committee on Government Procurement, although it
has been an observer since April 1997.  Norway would welcome Argentina as a member of this
Committee and ask if Argentina intends to become a member, and if yes, within which timeframe.
Poland
Accessibility of foreign companies to public tenders financed by the budget is difficult due to many formal
requirements. Is there any possibility to change a public tendering procedure in order to make it easier
and more transparent?WT/TPR/M/47
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Canada
As noted in Chapter III, section 2, sub-section (xii) (Government procurement), paragraph 92, Argentina
has been an observer in the WTO Committee on Government Procurement since April 1997, "with a view
to deciding on its eventual accession to the Agreement".  Can Argentina give an indication of any steps it
is taking to prepare for accession to the Agreement and when it might join this Agreement?
Argentina’s participation in the WTO Committee on Government Procurement as an observer
reflects our country’s interest in government procurement in general and is a good way of closely
monitoring the development of rules and practic es in this field at the international level.
As is well known, our country also participates actively in regional initiatives in this field,
particularly under MERCOSUR, which has established an Ad Hoc Group to prepare a regulatory
framework for government procurement, and in the FTAA which has a Negotiating Group on
Government Procurement.  For the time being, we do not intend to adhere to the WTO’s plurilateral
Agreement on Government Procurement.
With respect to one of the questions which mentions that there are “many formal requirements”
for foreign companies to participate in bidding in ou r country, we do not share this view.  We believe that
our legislation establishes fewer formal requirements and contains fewer preferences for local suppliers
than can be found in the legislation of other countries whose development is at the same or higher levels
than Argentina.
Argentina’s procurement regime differentiates between goods and services, on the one hand, and
public works, on the other.  There are also special procedures for public works concessions.
Procurement procedures vary depending on the different regimes – procurement of goods and
services, contracting of public works, and concession of public works.  In all cases, public, private and
direct contracting are permitted, although preference is given to public bidding.  The legislation spells outthe cases in which private bidding or direct contracting can be used.
For public works  it is indispensable to enrol beforehand in the National Register of Public Works
Building Contractors so that companies can be qua lified and trained.  The system allows for some
exceptions to advance registration.
The rules on government procurement of goods and services and public works and concessions
establish a mechanism for filing objections through admini strative channels.  If administrative remedies are
exhausted, the parties are free to go to the courts.
There is a preference for the procurement or contracting of goods of domestic origin in the case
of similar bids for identical quality and performance, when the price is the same or lower than the price of
foreign goods.
Preference is given to local companies in contract s for works and services in the event that the
bids made by a national and a foreign company are the same.WT/TPR/M/47
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(9) Export subsidies, export insurance/guarantees, export taxes
Dr. Notis
Argentina applies two export assistance programs that have been notified to the WTO.  The first is
exports of industrial plants and engineering projects under turnkey contracts.  The second program bears
on the ports in Patagonia.  With respect to this program, the authorities are considering an alternative
development program for Patagonia falling under the category of non-actionable subsidies that willpermit the current system to be phased out at a faster pace, in line with the WTO provisions (page 94-95,
paragraph 126-128).  I would like to ask what progress has been made in this alternative program.  I
would also like to know whether something similar is being considered for the first program, which is
similar to a TRIM, although it partly concerns a service activity.
Last I would like to refer to government tariff co ncessions.  Since 1991, a drawback has applied that
permits the partial or full refund of import duties and the statistical tax on inputs used to manufacture
export products, as well as the VAT and excise taxes paid at different processing stages.  According to theauthorities, this system is not considered to be an export subsidy, which is why WTO was not notified.  I
would appreciate your comments on this.
USA (incentives)
- Section 11 on page 8 of WT/TPR/S/47 indicates that Argentine Government “efforts to reduce
public expenditure were focused on suppression, under the Convertibility Law, of the tax
adjustment for inflation purposes and the elimination or reduction of certain tax incentives suchas drawbacks for exports, incentives linked to  sale of domestically produced capital goods, and
the industrial specialization regime”.  Could Argentina please state to what extent each of these
programs has been reduced, and provide detailed information on programs still in existence?
(Export subsidies)
- In section (vi), titled “Export Subsidies” on page 89 of WT/TPR/S/47, number 127 states:
“Under a scheme introduced in 1985, run by MEOSP, rebates of 15% to non-MERCOSUR
destinations, benefit exports of industrial plants and engineering operations under turnkey
contracts; the types of operations covered by the scheme are specified in domestic
legislation (annex list to Decree 525/85) and the exporting company must be in charge of theentire project."  [Law 23101, 28 September 1984;  Decree 525/85, 15 March 1985;
Decree 1011/91;  Decree 2275/94; MEOSP Resolutions 437/85, 355/95 and 32/96;
GATT (1992);  IMF (1996)]
- Such rebates are calculated on the f.o.b., c. and f., or c.i.f. value of the export, depending on
whether the exporter selects domestic or foreign insurance or transportation firms;  this
valuation method appears to provide an incentive for choosing local firms.  Eligibility remains
tied to local- and goods-content requirements (not less than 60% and 40%, respectively), based
on the f.o.b. "export value”.  Could Argentina provide more information regarding how therebates are calculated, and which companies and/or industries currently benefit from theprogram?  Also, is there a date for the termination under the program?
- Following the International Office of Epizootics’ (IOE) decision declaring Argentina to be free of
foot-and-mouth disease in 1997, the Government of Argentina planned the establishment of a new
entity with both public and private sector participation to promote beef sales abroad.  Could
Argentina explain if such an entity has been established?  If so, please explain the role(s) of
public and private participation in these entities with respect to funding sources, and how they
execute promotion plans.WT/TPR/M/47
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Norway (Export subsidies)
Argentina is expected to eliminate any export subsidies for manufactured items, classified as prohibited
under the WTO Subsidies Agreement, by 2003 (Secretariat’s Report page 82, paragraph 129).  Is
Argentina planning to phase out these subsidies be fore 2003?  If not, could Argentina elaborate the
reasons behind keeping them?
Costa Rica
What is the size of the subsidies paid to agriculture through subsidized credits?
Canada
With reference to Chapter III, section 3, sub-section (ix) (Export insurance and guarantees),
paragraphs 136-138, several government assistance programs outlined in the Trade Policy Review were
not included in Argentina's recent notification of s ubsidies measures (G/SCM/N/38/ARG).  Why were the
following programs not included?
Export insurance, export promotion, and marketing assistance schemes (paragraphs 136-138);
Free-trade zones (paragraph 142);
Incentive programs administered by the provinces (paragraph 146);
Sectoral contracts (paragraph 147);
R&D programs (paragraphs 148 and 149);  and
Sectoral promotion programs (paragraph 156).
The notification made by Argentina to the Committee on Subsidies and Countervailing Measures
in October 1998 (G/SCM/N/38/ARG) includes the majo rity of the plans and programmes mentioned by
Canada.  This new and complete notification reflects the different export promotion programmes in effect
in Argentina.
The drawback is a mechanism for refunding taxe s paid when inputs are imported for subsequent
use in the manufacture of goods for export.  This is not a tax incentive and only that portion
corresponding to the value of the imported products used in the finished export product is refunded, based
on a technical ratio determined by the relevant technical agency.
Tax incentives to place capital goods produced in the country on an equal footing with imported
capital goods were eliminated in 1996.
The Industrial Specialization Regime established in Decree 2641/92 was suspended in
August 1996 by Decree 997/96.  The companies that pa rticipated in this programme maintained the
remaining benefit which will end on 31 December 1999.  The regime was notified to the Committee on
Subsidies and Countervailing Measures in July 1997.
The programme mentioned by the United States is a rebate of indirect taxes that benefits exports
of turnkey plants.  The eligibility of companies is based on a series of general criteria which do not entail
selectivity or targeting of benefits that could be viewed as a specific or prohibited subsidy under the WTOAgreement on Subsidies and Countervailing Measures.WT/TPR/M/47
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(10) Competition Policy
Hong Kong, China
(WT/TPR/S/47, pp. 89-90, paras. 159-166) It is stat ed that there have been attempts to address
weaknesses in the legislative framework in the area of competition.  We are interested to know more
details on these perceived weaknesses and how they affect the operation of the market mechanism, and on
the latest bill which seeks to address various provisions.
Japan
- It is reported that no prior governmental examination and regulation of mergers or other
combinations is foreseen.  Please explain the reason (para. 160, p. 89).
- It is reported that eight amendment bills on competition legislation have been introduced to the
Congress but have not gained enough support to be passed by both houses. (para. 163, p. 89):
a) Please explain the reason for not gaining support from the houses;  b) Please explain the
further details of the amendment bills.
- MERCOSUR's Competition Protection Protocol was agreed in December 1996. Please explain
the relationship between the Protocol and domestic competition law (para. 163, p. 89).
- Please explain the relationship between legislation on consumer defence and the competition
legislation in Argentina.
At the end of last year, the Trade, General Legislation, Justice, and Budget and Finance
Committees of the Chamber of Deputies drafted a bill by consensus on competition protection which was
sent to the Chamber for adoption.  The bill is based on a series of different initiatives presented by various
deputies in 1997 and 1998.
The salient aspects of the bill, which constitute amendments or additions to Law 22262, are:
- The creation of a National Court for the Protection of Competition as a self-sufficient
body to enforce the new law.  The court will be composed of seven members to be
selected on the basis of their experience by a jury composed of the Chief Treasury
Officer, the Secretary of Industry, Trade and Mining of the Ministry of the Economy,
Public Works and Services, the chairs of the Trade Committees of the Chamber and the
Senate, the chair of the National Financial Penalty Appeals Board, and the presidents ofthe National Academy of Law and the National Academy of Economic Sciences
(Article 20 of the bill).  The court will issue its decisions directly, which is a change in
the current system where the Secretary of Industry, Trade and Mining issues decisions
after receiving a report from the National Commission for the Protection of Competition.
The bill is therefore a necessary and significant institutional step forward, which gives the
court political and financial independence to carry out its functions.
- Control of concentrations and mergers.  In  line with the recommendations of the WTO,
OECD and the World Bank, the bill provides for the adoption of regulations relating to
“market conformation”, as a preventive complement to policies on traditional
“behaviour” in this area involving anti-competitive acts and conduct.  A National
Registry is created in which all operations should be enrolled, each of which may be
authorized or denied by the national court mentioned in the preceding paragraph.WT/TPR/M/47
Page 79
- To revoke all powers over competition related to this area that may have been granted to
other regulatory agencies or entities, such as the CNC or ENARGAS.  This means that
the jurisdiction of the National Court for the Protection of Competition is applicable
country-wide.
- To monitor and sanction companies or individuals that obtain “competitive advantages”
on the basis of proven legal infractions.
- The Competition Protection Protocol, ME RCOSUR and Law 22262 are independent and
complementary for different economic spaces (MERCOSUR and Argentina) and contain
general and specific rules.
(11) TRIPs
USA
- How does Argentina intend to ensure that ANMAT recognizes its responsibility to enforce EMR
and that the Government of Argentina, therefore, provides EMR as required by TRIPs?
- How does Argentina justify its recent elimination of the previously-provided ten years of
protection for proprietary test data for agrochemicals in light of the standstill obligations under
TRIPs?
- What is the status of Argentina’s efforts to protect proprietary test data submitted in connection
with applications for marketing approval for pharmaceutical products against unfair commercialuse?
- How does Argentina intend to meet its TRIPs obligations as regards the protection of proprietary
data?
- What is the status of Argentina’s efforts to enact a law dealing specifically with the protection of
layout designs of integrated circuits?
- What is the status of the trademark la w amendment concerning border protection?
- Will the trademark law amendment include provisions addressing concerns about the inability of
firms to obtain criminal prosecution, moneta ry damages, and criminal sanctions against
counterfeiters?
- What is the status of Argentina’s enforcement efforts for copyrights?  What is the status of
Argentina’s efforts to increase deterrents to copyrights piracy?
- Could the Government of Argentina please outline its efforts to bring its copyright law up to
TRIPs standards?
- Could the Government of Argentina please detail efforts to develop a common IPR regime in
MERCOSUR?WT/TPR/M/47
Page 80
European Union
Does the 20-year term patent protection provided by Argentina’s 1996 patent law apply to all pending
patent applications once the law has entered into force, or is it limited to those applications filed after
October 1995?
Is commercial testing permitted before expiry of a patent?
Art.70.9 TRIPs requires countries which benefit from the transitional period to grant exclusive marketing
rights for a period of five years.  How did Argen tina implement this obligation?  Can Argentina please
explain how companies can obtain such exclusive marketing rights?
Does the 1996 data-exclusivity Law 24.766 meet the standards comparable to those set out in Art. 39.3
TRIPs?  If so, could Argentina please explain the reasoning why it considers that full data protection is
granted?
Insofar as Law 24.766 deals with the protection of trade secrets and data submitted to the regulatory
health agencies, the EU is also concerned about enforcement problems result ing from the absence of
implementing regulations.
(Linkage between health product re gistration and the patent status)
The health agencies continue to refuse to take into account the existence of patents when approving the
marketing of products. Officials claim that they cannot apply Article 8 of law 24.766 because they have
not received instructions to that effect.
Could Argentina confirm that the executive power will issue the instructions necessary to establish a link
between product registration and patent status to ensure that officials in charge with registering new
products refuse to approve the marketing of new products where the latter infringe patent rights?
(Application of international standards on regulatory requirements)
Are steps being taken in Argentina to ensure that health agencies comply with Article 5 of Law 24.766
requiring bioavailability and bioequivalence testing – according to international standards – of the
so-called “similar” products (limitations)?
(Revalidation of foreign patents)
Are steps being taken in Argentina to ensure that pending filings on confirmation of patents are approved
according to the law in force at the time of th e filing as ordered by various Court decisions?
(Conversion of pharmaceutical process paten t applications into product applications)
Are steps being taken in Argentina to make such conversion possible according to the principles set in the
patent law and in TRIPs Articles 65(5) and 70(7)?
Canada
With reference to Chapter III, section 4, sub-secti on (v) (Enforcement of intellectual property rights),
paragraphs 180-182, could Argentina report on the status  of legislation that would see software included
in the copyright law?WT/TPR/M/47
Page 81
What additional efforts are envisioned to combat softwa re piracy?  Specifically, what  measures will be
taken to enforce the new law once adopted?
What measures is the Federal Government of Argentina taking to ensure that responsibilities under
international obligations concerning software have been conveyed to the appropriate provincial
authorities?
With regard to Chapter III, section 4, sub-section (v) (Enforcement of intellectual property rights),
transfer of proprietary information, paragraph 177, is it Argentina’s intention to have the INPI or any
other official Argentine agency, continue to require registration of transfers of technology?
Costa Rica
What type of protection does Argentine legislation provide for plant varieties?
With respect to the protection of layout designs of integrated circuits Argentina has been working
for a year now in the Intellectual Property Committee of MERCOSUR’s Subgroup 7 to prepare a project
based on harmonized principles.
The Executive Branch has drafted a bill that will soon be submitted to the legislature, which
respects the provisions on border protection in the TRIPS Agreement.  In the last year, INPI, in
conjunction with the Domestic Trade and the Foreign Trade Branches and the National Customs
Administration, has worked on implementing advance administrative measures.  A bilateral cooperation
agreement is under negotiation with Paraguay, as well as a joint publicity campaign to combat piracy inboth countries.
The efforts to develop a common regime on intellectual property in MERCOSUR have led to the
adoption of the following measures:
- Protocol on trademarks and appellations of origin.
- Protocol on industrial models and designs.- Project to create a matrix harmonizing procedures for patents and utility models.
- Approval of the IDB-MERCOSUR project to establish a network linking the industrial
property offices of the four countries in stage one and the copyright offices in stage two,
in order to combat piracy.
It has not been necessary to register technology transfers in Argentina since 1981.  However, the
National Industrial Property Authority is the authority that applies a law for voluntary registration of
transfers.  The voluntary register permits those enrolled to enjoy tax benefits and also serves to keep
statistical records.
As for patents, all applications presented after 1 January 1995, are granted 20 years of protection
after the date of presentation.  Applications to patent pharmaceutical products (subject to the transition
period) will also be protected for 20 years after presentation.
With respect to Article 70.9 of the TRIPS Agreement, applications for exclusive marketing rights
during the transition period are to be presented to the National Industrial Property Authority together with
the necessary information to enable it to certify that:WT/TPR/M/47
Page 82
(a) an application to patent the product has been filed with INPI;
(b) a patent application to protect the same product was filed after 1 January 1995, in another
country that is a member of the TRIPS Agreement, verifying that the two presentations
are the same;
(c) a patent for the product in the other member country of TRIPs was granted after
1 January 1995;
(d) approval to market the product in the other member country of TRIPs was obtained after
1 January 1995.
Once this information has been verified, the National Institute of Industrial Property will
determine whether to grant exclusive marketing rights in Argentina for a period of five years after a
marketing licence was granted in Argentina, with the exception that the permit will expire prior to the end
of that term if a patent is granted or rejected by INPI or if the licence to market the product is withdrawn.
The concession of exclusive marketing rights is subject to authorization to manufacture and sell
pharmaceutical products, which must be obtained from the Ministry of Health and Social Action.
Cooperation agreements are being established be tween INPI and SENASA and between INPI and
ANMAT to establish a data cross-check system.
The problems linked to the legislation applicable  to pending applications for patents are being
settled in the courts.  The Supreme Court has not handed down any decisions to date.  The cases havebeen heard by lower and appeal court magistrates and a decision is being awaited in one case that reached
the Supreme Court.  The National Patent Administration converts applications for patents for processes
into applications for patents for products on its own in itiative, as established in Articles 65(5) and 70 (7)
of the TRIPS Agreement.
With regard to the bioequivalency test, under SAGPyA Resolution 440/98, a registered product
that is substantially similar may not be marketed prior to expiry of the patent on the product that it
resembles.  To do so is to commit an infraction that is regulated under private law, and decisions can be
appealed to the competent national courts.
Argentina complies with the obligation imposed in Article 39.3 of the TRIPS Agreement.  It is
covered in Law 24766/96 on Confidentiality, which requires that information be protected against unfairuse.  No authority is obliged to require that information already produced by the first applicant be
repeated or to refuse registration based on similarity to a registered product (subject to indispensable
technical rules and supporting documentation).  Therefore, Argentine legislation does not prevent the
competent authority from using a product registered earlier as the basis for a decision on subsequent
applications for registration relating to the same product.  In these cases of short procedure, the authority
does not need to re-evaluate information already presented, since it is simply a matter of registering a
“similar” product.  Therefore, as established for pharmaceutical products, approval on the grounds ofsimilarity does not imply the use of confidential information provided by the first applicant to register a
“new” product.
The following clarifications are called for re garding the linkage between the marketing licence
and the patent:
- SENASA is the competent national agency and the implementing authority with respect
to the Registry of Phytosanitary Products.  The granting of intellectual property rights in
the form of patents is the responsibility of the National Institute of Intellectual Property
(INPI) which is the implementing authority.WT/TPR/M/47
Page 83
- The certificate authorizing the marketing of a phytosanitary product is the equivalent of a
sanitary “clearance” which is one of the requisites for marketing a product.  Article 10 of
SAGPyA Resolution 440/98 expressly states that a licence will be granted to market such
products (in accordance with Decree 489/58), although the remaining conditions required
by law must also be complied with.
SENASA may not refuse to grant a marketing licence even if it is aware that a patent has already
been issued for a similar original product, since that patent may or may not be in effect at the time the
application to register a similar product is made.  What SENASA will do is warn that a patent has been
granted and point out the legal consequences of violating the law.
The following should be noted with respect to copyrights:
(i) Law 25036 (promulgated by Decree 1307/98 of 6/11/98) amended Law 11723 to include
software among works that are protected by copyright.  This measure, which extends to
databases, implies that the criminal sanctions in Law 11723 apply to software pirates.
This law has made it possible to make large seizures of pirated copies and to prosecute the
offenders.
(ii) Under Law 25036 the provisions of Articles 9.2, 10.1 and 10.2 of the TRIPS Agreement
have been complied with.
A bill has been sent to Congress approving our country’s adhesion to the 1971 Paris Act of the
Berne Convention and to ratify the new  WIPO Treaties (WCT and WPPT).
The Ministry of Justice submitted a proposal to completely reform Law 11723 to the President in
December 1998, which includes special penalties for piracy of works of all kinds, seizure and destruction
of the offending materials and of the means used to produce them.  The sanctions apply to the rental of
illicit supports.
In accordance with the provisions of Article 11 of the TRIPS Agreement, the proposal also
provides for the right to lease all types of supports (software, phonograms, videos, etc.).
(iii) Periodic meetings are held of Subgroup 7 (Industrial and Technical Policies - Intellectual
Property Committee) with respect to harmonization of intellectual property legislation
under MERCOSUR.  No draft protocol has been produced in the specific field ofcopyrights as yet.  However, meetings of government experts in this field from the
countries in the area have been held to identify the points that need harmonizing and to
begin drafting a protocol.  These meetings have been sponsored by WIPO.
Progress has been made in this harmonization process in the most recent laws passed in Brazil
and Paraguay.
Last, with respect to Canada’s third question on intellectual property rights, in Argentina the laws
passed by Congress, including those on the adoption or ratification of international treaties, are applicablecountry-wide and the provincial governments do not need to take any action to place them in effect.WT/TPR/M/47
Page 84
Argentine patent law makes no mention of plant varieties.  They are protected in our country by
virtue of the fact that Argentina belongs to the International Union for the Protection of New Varieties of
Plants (UPOV) (Act 1978), which prohibits the syst em of double protection (Law 24376/94 that approved
adhesion to UPOV).
In addition to its commitments under UPOV, plant varieties are protected in Argentine legislation
under the Seeds Act (Law 20247) and Regulatory Decree 2183/91.  Article 26 of the decree requires thatto be protected, a variety must meet the following requisites:
(a) Novelty:  It must not have been offered for sale or marketed by the breeder or with his
consent in:
- Argentina prior to the date on which the application for inclusion in the National Register
of Cultivar Ownership was made;
- in the territory of another State which is a signatory with Argentina to a bilateral or
multilateral agreement in this field for a period of more than four years, or in the case oftrees and vines, for a period of more than six years prior to the application for
registration.
(b) Differentiability:  That it can be clearly distinguished through one or more characteristics
from any other variety whose existence is general knowledge at the time the application
is made.
(c) Homogeneity:  That, subject to foreseeable variations deriving from the particular
mechanisms through which it is propagated, it maintains its most relevant characteristics
in a sufficiently uniform manner.
(d) Stability:  That its relevant hereditary ch aracteristics conform to the original definition
after successive propagations or, in cases of a special propagation cycle, at the end of thatcycle.
The Argentine authorities are studying the possibi lity of establishing the conditions that would
permit the country to adhere to the 1991 UPOV Act.
III. POLICIES AND MEASURES BY SECTOR
(1) Sectoral trade policy objectivesNew Zealand
(S/47, Pt II (4), p. 22, para. 18) We welcome the significant efforts made by Argentina towards
liberalisation of its economy.  However, we note th e Secretariat’s report that Argentina still maintains
border protection and encourages domestic supplies for certain domestic industries through
sector-specific trade related measures.  Does Argentina have any intentions to review these
arrangements?
(S/47, Pt II(4), p. 23, para. 20) The Secretariat reports that full implementation of the WTO provisions on
TRIPS and TRIMS will require important industrial adaptation to new regimes in the pharmaceutical and
automobile industries.  Does Argentina have any me asures in mind to assist the adaptation of those
industries?WT/TPR/M/47
Page 85
Argentina does not implement sectoral policies, with the exception of the automotive sector.  The
automotive regime dates from 1991 and is therefore predates the end of the Uruguay Round.  The current
situation in the automotive sector is discussed below in the framework of MERCOSUR.
The cases mentioned in paragraph 18 (page 22) of the Secretariat’s Report only reflect measures
adopted to cope with particular situations for given products or groups of products.
(2) Agriculture:  net transfers;  National Grain Board;  sugar, variable levies;  tobacco;  fisheries;
forestry
Ambassador Farrell
(The Automotive Sector) With its strong and admirably demonstrated belief in economic reform and
liberalisation, how does Argentina see its own automotive sector evolving over the years ahead?  Can
and indeed should the economy sustain the level of protection afforded this sector?  Can a common
MERCOSUR regime be constructed to commence in 2000 which promotes transition to greater efficiency
and to international competitiveness, rather than risks entrenching apparent resource allocationdistortions?
(Agriculture Strategy) I would appreciate heari ng more about how Argentina assesses its own
performance against these objectives, and then about changes which may be seen as necessary in the
composition and weighting of Argentina’s existing agricultural strategy objectives in the light of
experience and of Argentina’s assessment of the future production and market environment foragricultural products.
Dr. Notis
Since 1992 variable levies have been applied to sugar of any origin, including MERCOSUR, in addition
to the prevailing ad valorem tariff (see page 65, paragraph 45 for more details).  I would like to know if
this trade practice is consistent with Article 4 of the Agreement on Agriculture and if it has been notifiedto WTO.
Norway
We note from the Secretariat’s Report that the agriculture sector remains of considerable importance to
the Argentine economy and generates, directly or indirectly, the larger part of merchandise export
revenues. It is further stated that Argentina once was the world’s largest beef exporter, but slipped tofourth position in 1998.
As a result of the International Office of Epizootics’ decision in 1997 to declare Argentina to be free of
foot-and-mouth disease Argentine authorities are said have planned the establishment of a new entity
with public and private sector participation to pr omote beef sales abroad. We would be interested in
receiving further details as regards for instance how to finance the set-up and day-to-day activities of the
new entity, its start of operations, whether a mark eting strategy has already been developed and market
shares objectives specified for the short and medium term.WT/TPR/M/47
Page 86
Canada
(On Agriculture)
With reference to Chapter IV, section 1, paragraph 3, what is the status of export taxes on unprocessed
oilseeds to assist domestic processing firms?  Is there any recent policy change on this measure?  What
types of effects have these taxes had on imports of unprocessed oilseeds, including the price effect on
domestic and imported oilseeds?
According to Chapter IV, section 2, sub-section (i),  paragraph 13, under the reforms of the last decade,
Argentina made changes in the mechanism to make transfers in the agricultural sector, shifting from
price-related transfers towards other net transfers via marketing boards prior to their elimination. Can
Argentina indicate what type of transfers were undertaken through marketing boards? Are they still in
place?  If some of these measures are still in place, how are transfers undertaken after the elimination of
marketing boards?
With reference to Chapter IV, section 2, sub-secti on (i) (Other), paragraph 25, following the elimination
of the National Grains Board, Argentina has progressively eliminated bilateral agreements for the supply
of grains to other countries at negotiated prices.  Are any of such agreements still in place?  How has the
elimination in 1995 of the agreement with Brazil to supply duty-free 2 million tonnes of wheat a year
affected Argentina's wheat prices for exports to Brazil?
With reference to Chapter IV, section 2, sub-section (i) (Sugar cane), paragraphs 33 and 34, can
Argentina explain the system of variable import le vies on sugar?  Could Argentina provide information
on what types of protective measures (ad valorem duties, statistical tax, variable levies) are used on the
importation of refined sugar, and data on exports and imports of refined sugar?
According to Chapter IV, section 2, sub-section (i) (Tobacco), paragraph 38, "... decline to US$84 million
in budgetary outlays for the price support mechanism for leaf tobacco was applied for the 1996/97 crop".Please clarify how the figure of $84 million for the price support mechanism for leaf tobacco was
estimated for the 1996/97 crop?  Could Argentina ex plain why it differs from the $86.4 million amount
noted in Argentina's reply to G/AG/N/ARG/4 at the meeting of Committee on Agriculture, March 19-20,
1998?  Specifically, Argentina noted that "we are able to inform the Committee that, in accordance with
the values assigned in the 1996/97 agricultural year, domestic support for tobacco reached a total ofUS$86.4 million".
Also, kindly explain how the $98 million amount repor ted as the cost of the price support mechanism
in 1995 was arrived at?
(From Government Report):  Section 3.4.2 (Prospects), paragraph 6 states, "In the field of agriculture,
Argentina will continue to promote further liberaliza tion of trade in multilateral forums, in coordination
with trading partners with whom it shares co mmon positions."  Could Argentina provide details
regarding the areas of agriculture in which it would propose further liberalization?
(On Fisheries)
Chapter IV, section 2, sub-section (ii) (Fisheries), paragraph 50 indicates that, between 1990 and 1997,
there was overfishing of some species, such as squid.  Paragraph 53 indicates that between 1992
and 1998 the exploitation of Argentine fisheries resources by foreign vessels (under a temporary
chartering regime) centred on squid, in an effort to increase the catch of that species and to compensateWT/TPR/M/47
Page 87
for the absence of national vessels fishing for squid.  What measures has Argentina taken to deal with
overfishing of squid by foreign vessels?
Does Argentina consider that improved market access for its squid exports was a principal factor which
led to this overfishing?
Paragraph 54 describes the bilateral Fisheries Agreement which Argentina concluded with the EU in
November 1992 and which came into force in Apri l 1994.  That agreement "allows EU fleets access to
Argentina's 200-mile reserved zone in exchange fo r a 50% reduction in the EU import tariff on Argentine
fishing products".  Which specific Argentine products (by HS tariff heading) are covered by the EU tariff
reductions, and what are the applicable rates of duty?  Are the EU reduced rates of duty contained in the
text of the agreement?
Are these tariff reductions subject to any quantitative limits?
What are the rules of origin that apply to Argentine products exported to the EU under this agreement?
Does Argentina intend to extend this agreement, given the statement (in paragraph 54) that, despite the
agreement, there has been no expansion of Argentine fish exports to the EU since 1994?
Paragraph 55 states that bilateral discussions on the establishment of possible fisheries agreements are
being held with China, Chinese Taipei, Japan, and Korea.  Is market access (e.g. reduction in tariffs by
those trading partners for fish product imports from Argentina) part of those discussions?
More generally, it appears that Argentina is pursuing a policy of exchanging access to its fish resources
in return for access to markets for Argentine fish products.  Does Argentina consider this policy
consistent with its general policy objective of ensuring "preservation of resources" (see paragraph 52)?
(On Forestry)
With reference to Chapter IV, section 2, sub-section (ii) (Forestry), paragraph 59, is there an export
requirement for any of the forestry programs outlined in this paragraph?
Australia
What progress has been made in the establishmen t of common regimes for sugar and automobiles in
MERCOSUR?
Costa Rica
What role was played by the National Meat Board and the National Grains Board in the formulation of
sectoral policies, transfers of funds from the public  to the private sector and sanitary improvement in
activities?
At present, Argentina maintains export duties on soybeans to compensate for tariff escalation on
imported refined oilseed products.  There are also export duties on raw and semi-tanned cowhides.
Alongside the disappearance of the marketing boards, Argentina has eliminated transfer
mechanisms.WT/TPR/M/47
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Today there are no preferential supply agreements in effect.  Since tariffs on trade among the
MERCOSUR countries were eliminated in 1995, the can cellation of the preferential supply agreement
with Brazil did not affect the domestic market.
The sugar imported from MERCOSUR, is taxed with an ad valorem tariff of 20%.  An
ad valorem  tariff of 23% is levied on imports from outside the zone, plus a 0.5% statistical tax.  In both
cases a special regime of sliding duties is added.  The regime is based on an additional or equivalencyduty to make up for the difference between the basic guide price and the comparison price.
The basic guide price is calculated at the beginning of each year on the basis of the monthly
average for the four previous years for white sugar quotes on the London Exchange, corresponding to
contract No. 5.
The comparison price is determined considering the sugar quotes available on the last market day
immediately prior to clearance of the shipment.
With respect to progress in the common regime  for sugar in MERCOSUR, in December 1998, the
Common Market Group decided to reconvene the Ad Hoc Group established pursuant to Decision 19/94
of the Council of Ministers to prepare a common regime that will come into effect in 2001.
Budgetary outlays for tobacco for the 1996/97 crop were $84.1 million.  This value is obtained by
applying an average unit payment of 0.7119 pesos per kilogram.  Production in that period was
118,199,645 kg.  The same mechanism was used to calculate budgetary outlays in 1995.
Since 1 January 1999, Argentina no longer has agricultural or agro-industrial products on the
Customs Union’s final adjustment schedule.
With respect to the creation of an agency to promote the sale of beef abroad (Norway), the
Argentinian authorities have decided not to establish an agency of the kind mentioned in the question.
Last, Argentina supports full liberalization of world trade in agriculture in all items.  It therefore
hopes that policies that distort trade and production (tariffs, non-tariff measures, domestic support and
support for exports)  will be eliminated during the upcoming agricultural negotiations so that farmers can
compete under equitable conditions.
(3) Manufacturing: higher rates on some final goods-specific minimum duties;  automobiles;
tariffs, local content (TRIMs), MERCOSUR;  textiles, clothing, footwear
Dr. Notis
Could the Argentine Delegation provide us with a bi t more information on the nature of this trade
measure (minimum specific duties on textiles) and on whether Argentina intends to continue applying it?
The minimum specific duties applied to textiles and clothing, after several adjustments, should have been
gradually reduced between June 1997 and April 1998 (page 144, paragraph 108).  The Secretariat
informs us in its Addendum  that these duties will continue to be applied until the end of March 2000.
Would you like to comment on this?  I would also like to ask what your future intentions are.WT/TPR/M/47
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Canada
With reference to Chapter IV, section 4, sub-section (iv) (Motor vehicles), paragraph 123 and Box IV.2, is
Argentina on target to remove its Automotive Industry Regime on 1 January 2000?
Australia
What progress has been made in the establishmen t of common regimes for sugar and automobiles in
MERCOSUR?
Japan
Local-content requirements (para. 102, p. 75)
1996 amendment of Argentina's local content requirement regime increased the level of local content in
automobiles. Is not this amendment inconsiste nt with Article 5:4 of the TRIMs Agreement?
Please explain the present situation and prospects of  eliminating local-content schemes to meet the
requirements of the TRIMs Agreement.
Czech Republic
Could the Argentine Delegation indicate some steps that could be taken toward greater liberalization of
imports of fully assembled private and freight vehicles?
What changes will occur after the MERCOSUR common regime for the automotive industry is applied at
the start of 2000?
Thailand
Latest status/information on the measures being applied by Argentina to the following items of goods:
- Cane sugar (previously non-automatic import licensing was applied);
- Boxes, cases, crates and similar articles of plastic (previously minimum import price was
applied);
- Tableware and kitchenware of other plastics (previously minimum import prices was
applied).
USA
In its submission, Argentina asserts:  “Automotiv e products are subject to special regimes under
Common Market Council Decision 29/94 and will confor m to the common regime on 1/1/2000.”  Could
the Government of Argentina please comment on efforts within MERCOSUR to ensure that the commonautomotive regime will comport with WTO requirements by the year 2000?
Norway
To our information Argentina uses local content requirements (for instance in the automotive industry,
Secretariat’s Report page 74).  Norway would like to  underline that such requirements are discriminating
and damaging to natural resource allocation.WT/TPR/M/47
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Costa Rica
Are the benefits obtained by some sectors (for example, sugar, clothing and footwear) from the measures
that have been taken decisive for their survival and competitiveness?  If so, how to you plan to deal with
this situation when tariffs are eventually reduced under WTO trade liberalization programmes?
With respect to Argentina’s automotive regime, Decree No. 33/96 which introduces changes in
the way of measuring local content in automotive production, was promptly notified to the Committee on
TRIMs.  With the entry into force of this measure, we moved from an appraisal system to the valuation of
parts in f.o.b. prices.  This was intended to overcome the shortcomings of the former system explained by
changes in technology in the automotive industry.
Since 1991, the Argentine automotive regime has been viewed as transitory, ending on
31 December 1999.  In 2000, a common MERCOSUR policy will be applied to the automotive sector
which will be governed by Decision 29/94 of the Common Market Council.
The common automotive regime was negotiated in Technical Committee 9 and the current
situation is described below.
In December 1998, the ministers of industry agreed upon a series of basic guidelines to conclude
negotiation of the common automotive regime.
The basic concepts of solidarity, complementarity, and combined productive and competitive
specialization that guided the building of the customs union were to be viewed from a new perspectivethat would make it possible to consolidate an industry that was competitive in prices, quality and
productivity, with export capacity.
Free trade within MERCOSUR, a common external tariff, the consolidation of domestic
industries, a competitive regional environment and a common export promotion policy are the key
elements in the common automotive policy.
A transition period from 1 January 2000, to 1 January 2004, was established for domestic
industries to adjust and adapt and for free trade am ong the members to become fully effective.  Goods
traded among the member countries are to have 60% regional content.  In application of the principle of
solidarity, conditions to ensure adequate participation by Paraguay and Uruguay are slated to be agreed
upon before 31 December 1999.
A quadripartite group will monitor developments in the industry, trade among the members and
exports to third countries during the transition period.  The key variables, quantitative elements and
possible adjustments to permit the group to perform its monitoring functions will be determined by
31 December 1999.
Cooperation among the private sectors in the four member States will be encouraged to facilitate
a satisfactory transition to full free trade.  This cooperation will be aimed at providing a more predictable
idea of how the industry and trade will evolve, keeping in mind the basic concepts of solidarity,complementarity, productive specialization and combined competitiveness.WT/TPR/M/47
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(4) Services:  further liberalisation/commitments;  financial services;  telecommunications;
transport (air and maritime);  electronic commerce
General
European Union
Paragraph 135:  Could the Government of Argentina confirm the current state and plans for
implementation of the MERCOSUR  Framework Agreement on Services adopted in December 1997?
USA
We note statements by the Secretariat, in para. 132, that Argentina provides preferential treatment to
some of its trading partners in audiovisual services  and land transport services.  The Secretariat’s note
states that while Argentina’s trading partners have li sted MFN exemptions in these areas, Argentina has
not.  Could Argentina provide its views on whether it provides MFN treatment in these areas?
We note that Argentina and the other three members of MERCOSUR are actively engaged in regional
services liberalization negotiations.  We welcome regional services liberalization initiatives that areconsistent with WTO disciplines.
Could Argentina provide information on the status of these negotiations, the extent to which preferences
are currently in force, and Argentina’s plans to submit the services agreement for WTO review?
What is the current timeframe for full liberalizati on of trade in services among MERCOSUR’s members?
Can Argentina confirm that non-MERCOSUR service suppliers established in a MERCOSUR member
country benefit from MERCOSUR’s preferences? [reference is to GATS Art. V:6 - the MERCOSUR
services protocol appears to require a head office in a MERCOSUR member to benefit from the
agreement]
The Montevideo Protocol on Trade in Services was approved at the 13
th meeting of the Common
Market Council in December 1997, and states that “the member States shall maintain successive roundsof negotiations in order to complete the programme to liberalize trade in services in MERCOSUR within
no more than ten years after this protocol enters into effect.  The rounds of negotiations shall be carried
out annually and their main objective shall be the gradual inclusion of sectors, sub-sectors, activities and
methods of delivering services in the protocol’s liberalization programme and the reduction or elimination
of the adverse impact of the measures on trade in services, as a way of ensuring effective market access”.
The framework protocol on services has led to the start of negotiations to define specific
commitments among the member States in MERCOSUR’s Ad Hoc Group on Services.  The group is also
examining the situation of service suppliers from non-MERCORSUR countries that are established in one
of the member States.WT/TPR/M/47
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Financial Services
Hong Kong, China
(WT/TPR/S/47, pp. 133-134, paras. 141- 142) We note that since privatisation took place since 1992,
there are still ten provincial banks that remain under public ownership.  We would like to know if
Argentina has any plans to privatise these ten banks as well.
(WT/TPR/S/47, p. 136, para. 147) We note that the susp ension in the establishment of new insurance
firms was eliminated on 1 October 1998.  Would Arge ntina submit an improved GATS commitments to
reflect the current situation?
Japan
It is reported that lending transactions and other operational limits for foreign bank branches are based
on the capital of the local branch, rather than the global capital of the bank for prudential reasons
(para. 140, p. 133).
Please explain why the branch capital is used as the base.  The credibility of a bank should be judged by
its total capital and such regulation might cause ba rrier for foreign banks to enter into Argentina's
market in branching.
Japan appreciates the establishment of new insurance operators, suspended since 1977, has been
authorized from October 1998.  Please explain why mi nimum capital requirements have been raised from
US$550,000 to US$3 million (para. 146, p. 135).
Canada
Chapter IV, section 5, sub-section (ii) (Financial services), paragraph 147 indicates that Argentina's
moratorium on the establishment of new insurance firms,  as provided for in its Schedule of commitments,
is due to be lifted on 1 October 1998.  Has this occurred and if not, when is it expected to be lifted?
On 1 October 1998, a regulation that impeded the authorization and establishment of new firms
was lifted.  Therefore, since that date, new insurance firms can set up in Argentina, provided they meet
the legal requirements.
These measures were taken independently as part of the government’s policy for economic
openness and deregulation.  For the time being, there are no plans to modify our country’s Schedule of
Specific Commitments in the sector, which was the result of the sectoral negotiations held in WTO, sinceit strikes a suitable balance of concessions.
With regard to the question on the operational limits for foreign bank branches, the capital of the
branch is used as the basis for prudential reasons, since the risks assumed in Argentina by a branch of a
foreign bank are thus covered by the capital committed in the country.  We do not know how much of the
total capital of a bank is committed to cover risks in the rest of the world and how much would be
available to cover risks in Argentina.WT/TPR/M/47
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Telecommunications services
Ambassador Farrell
(Telecommunications and Aviation) I wonder however a bout the consistency of this open and competitive
approach to a key future technology sector on the one hand, and on the other, the trade policy adopted
in 1995 in relation to the imposition of tariffs on informatics and telecommunications products, together
with the decision by Argentina not to participa te in the International Technology Agreement?
This raises the broader question of whether there is an overall trade and development strategy relating to
telecommunications and information technology?  Perhaps comments on this could be shared with us.
Given the potential it holds for increasing air cargo frequency and carrying capacity for items such as
fresh produce and high-tech parts and spares, perhaps an interesting policy question on this front is
whether Argentina will be l ooking at the advantages of pursuing an “open skies” policy?
Hong Kong, China
(WT/TPR/S/47, pp. 136-137, paras. 148- 152) We note that the exclusive rights of Telecom Argentina and
Telefonica de Argentina in basic telecommunications  services will expire by October 1999 and two more
operators are to be authorised to provide basic services.  It is however stated in Argentina’s Schedule of
Specific Commitments that there will be liberalisation by 8 November 2000.  Does it mean that Argentina
will liberalise this sector earlier than scheduled?
(WT/TPR/S/47, p. 136, para. 149) In Argentina’s Schedu le of Commitments, it is stated that mobile
telephone services are supplied under a duopolistic regime.  However, in the Secretariat Report, it is
stated that the territory is divided into three regi ons and each is serviced by two different companies:
Movicom and Movistar/Miniphone for the Greater Buenos Aires area;  CTI Norte and Telecom personal
for the northern part; CTI Sur and Unifon/Telefonica de Argentina for the south.  Does it mean that the
duopoly has already ended?
Japan
It is reported that market access is subject to reciprocity conditions concerning fixed satellite
communication geostationary services. Japan understands that this limitation is aimed at the development
of domestic satellite communication system in Argentina, thus such limitation should be eliminated in
accordance with the development of the system (para. 150, p. 137).
Please explain the present situation of the development of the system as well as prospect for the
elimination of the above limitation.
Argentina commits no limitations on market access and national treatment for modes 1, 2 and 3 from
8 November 2000 in most of the sub-sectors.  On the other hand, as stated in paragraph 151, p. 137, of
the Secretariat Report, in 1997, exclusive rights  of the two operators on basic telecommunications
services were extended until 1999.  Please explain the schedule for liberalization by the year 2000 as well
as if there has been any change of the timeframe affected by the extension of the exclusive rights.WT/TPR/M/47
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Canada
With reference to Chapter IV, section 5, sub-section (iii) (Telecommunications), paragraph 157, is
Argentina on target to liberalize the basic telecommunications sector on the committed date of
8 November 2000?
We understand the 1997 public tender for the supply of personnel communications (PCS) for the
Buenos Aires area had been stopped by a judicial process, and that the tender was to be reconducted inDecember 1998.  May we have information on the status or outcome of the tender?
Norway
What is meant by “Fixed geostationary satellite services were excluded from any commitments for the
period that already operating suppliers (INTELSA T and PANAMSAT) remain in place” (Secretariat’s
Report page 138, paragraph 157).
European Union
Paragraph 132:  We would appreciate confirmation from the Government of Argentina as to the coverage
and application of Argentina’s MFN exemption on satellites facilities of geostationary satellites operating
fixed satellite services.
Paragraphs 148 and 151:  The last sentence of paragraph 148 indicates that “from November 1999, two
more operators will be allowed to operate basic telecommunication services”.  This is also confirmed in
paragraph 151.  Nevertheless, Argentina has underta ken commitments on all basic telecommunications
services with no restrictions as from November 2000.  Could the Government of Argentina confirm that
as from 8 November 2000 there will be no limitations on the number of providers of basic
telecommunication services (except those justified on the basis of legitimate management of frequencies)?
Paragraph 150:  Could the Government of Argentina clarify what is the role of Inmarsat in the supply of
mobile satellite services which are said “not to be  subject to restrictions”?  Can systems other than
Inmarsat provide the necessary facilities for the provision of mobile satellite services in Argentina?
Paragraph 152:  Could the Government of Argentina confirm whether all basic telecom services are
subject to licence in Argentina?  Is that the case also for resale and private voice and data services? Are
there any of those services subject to general authorisation or declaration processes?
Could the Government of Argentina confirm whethe r an interconnection framework is in place and what
are its main characteristics?
Could the Government of Argentina indicate whether there is a universal services obligation system in
Argentina and what services does it cover?
The Government’s telecommunications liberalization plan calls for the liberalization of public
telephony and telephone service in rural areas.  Exclusive rights have also been extended to two new
suppliers starting in 1999 and the market is slated to be liberalized by November 2000 as established in
the Schedule of Commitments.
The provision of satellite facilities of geostationary satellites will be authorized under reciprocal
conditions, and this appears in Argentina’s list of exemptions, with the intent being to develop domestic
satellite systems.  That is why they are not included in the Schedule of Commitments.WT/TPR/M/47
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As for the status of INTELSAT y PANAMSAT, they acquired rights in function of their
provision of satellite facilities in the country and this situation was reflected in the General Regulations on
Satellite Management and Services (Resolution S.  C. 14/97, Resolution S.C. 242/97 and Resolution
S.C. 1118/98).  " Non-Argentine satellites authorized to provide satellite facilities in the Argentine
Republic as of the date on which this regulation is published shall continue to provide the said facilities
under the agreed conditions."
There are no restrictions on the exemption for the provision of satellite facilities of geostationary
satellites.  Development of the domestic system is linked to the possibility of opening up third markets,
only under conditions of reciprocity.  In our view, an open skies policy for satellites can only be achieved
with reciprocity systems that strengthen our system under conditions of equity.
INMARSAT has the status of an authorized supplier of communications services, regulated under
the Articles of Agreement and the Operating Agreement to which Argentina is party.  In the specific case
of INMARSAT, since it operates geostationary satellites but they belong to the mobile satellite service,they are not governed by the regulatory framework established in Resolutions 14/97, 242/97 and 1118/97.
Argentina’s regulatory framework also esta blishes provisions governing non-geostationary
satellite systems with the capacity to supply mobile and fixed telecommunications services to end users
(Resolution 2325/98).  The provision of mobile or fixed services via satellite will be subject to obtaining a
licence to provide telecommunications services and permission to use the spectrum.
As for personal communications services (PCS), the public bidding to provide the service that
was slated to begin in 1997 was halted by a complaint laid by one of the bidders regarding the general
bidding conditions.  In response, the Department of Communications made substantial changes in the
conditions.  The issue is currently before the Administrative Litigation Board of the Federal Capital for a
final ruling.
It is necessary to obtain a licence to provide telecommunications services to third parties.  In the
particular case of private voice services, specific regulations are under study with a view to future
liberalization of the market.
Interconnection is governed by the general interconnection regulations (Resolution 49/97), the
economic conditions for interconnection (Resolution 61/97) and the establishment of economic conditionsin interconnection agreements between the LSBTs and the suppliers of audiotext services
(Resolution 184/97).
The main objectives of these regulations (Resolution 49/97) are:  to promote the entry into the
market of new service suppliers, to integrate the country’s different regions through telecommunications
services, to guarantee equitable conditions for comp etition and prevent impositions that would lead to the
inefficient use of each supplier’s resources and to ensure the interconnection and inter-operational
capacity of telecommunications networks and services.  The principles governing the regulations are:agreements between the parties, binding force, non- discrimination, reciprocal compensation, efficiency,
open access, prices based on long-term incremental costs and resale (suppliers may offer services for
resale, in which case they may not impose discriminatory conditions).WT/TPR/M/47
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With respect to universal service, in Decree 264/98, the Executive Branch instructed the
Department of Communications to issue general regulations governing universal service, which will
define the concept and scope, the beneficiaries of the services, the cost of services and mechanisms to
finance potential deficits.
In the Schedule of Specific Commitments it is established that “mobile telephone service is
supplied under a duopolistic regime and the spectrum available in all operating areas has already beenassigned”.  Argentina has been divided into three operating areas for the purposes of mobile telephone
services.  The service in each of these areas is provided by two companies and, accordingly, the
commitments are being respected.
Transport (air, land and maritime)
Dr. Notis
In the services sectors, Argentina assumed ve ry broad commitments under the General Agreement on
Trade in Services.  I cannot resist the temptation of asking why agreements for equal cargo-sharing ofbilateral trade continue to exist?  Perhaps it would be better to ask what Argentina’s intentions are with
respect to future negotiations.
Japan
Shipping (para. 168, p. 141) It is reported that at  MERCOSUR level, the establishment of a Special
Register of Vessels and the negotiation of a Multilateral Agreement on Maritime Transport wereproposed.
- Please explain on "Special Register of Vessels".
- Please also explain the content of the "negotiation of a Multilateral Agreement on
Maritime Transport".
Air transportation (para. 169, p. 141) It is reported that all special rights of the national carrier,
Aerolíneas Argentinas, will be removed by the year 2000.
- Which special rights does Aerolineas Argentinas have?
- Please explain the expected schedule for the removal of the special rights.
Norway
According to the Secretariat’s Report on page 140 paragraph 164: Argentina has bilateral agreements
with Brazil, Cuba, Peru, Romania, The Russian Federation and China which provides for equal
cargo-sharing of bilateral trade carried on vessels operated by ship-owners of the signatories.
Norway would welcome some more information regard ing these cargo sharing provisions.  Firstly, how
much of the bilateral trade is transported on these vessels as a percentage of total bilateral trade?
Secondly, are cargo rates for bilateral trade higher than international rates, and if so, have any cost
analysis been calculated for the exporters, importers and consumers?  Thirdly, is Argentina planning to
take an initiative to eliminate the cargo-sharing provisions?WT/TPR/M/47
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In the context of MERCOSUR have any restrictions been introduced on market access for vessels from
third countries regarding navigation between the M ERCOSUR states. If affirmative, which ones and are
these compatible with the NGMTS (Negotiation Group on Maritime Transport Services) standstill
obligations.
European Union
Paragraph 168:  this paragraph indicates that “at MERCOSUR level, Argentina’s objectives include …
the establishment of a Special Register of Vessels and the negotiation of a Multilateral Agreement on
Maritime Transport”.  Could the Government of Argentina explain what would be the possible
consequences of these developments on market access, i.e. access to the international maritime market?
With respect to maritime transport services, the “register of vessels” is an agreement that does not
place restrictions on access.  Enrolment is optional and does not restrict participation in transport within
or between the members of MERCOSUR or with third countries.
The mention of negotiations under MERCOSUR probably refers to an agreement on multi-modal
transport.  It has not been concluded but a draft agreement is being examin ed in MERCOSUR Subgroup 5
(transport).
Our country has signed bilateral agreements with Brazil, Cuba, Russia and the People’s Republic
of China on cargo sharing in bilateral trade between th e parties.  The agreement with China is virtually no
longer in effect, since it has not been used since 1995.  Except for these bilateral agreements, there are nomeasures that restrict access to the maritime freight transport market.  Maritime traffic to and from our
country is free to any vessel flying any flag, and they compete under equal conditions with Argentine
shipping companies (except for the ocean and rive r coasting trade which is reserved for national
companies).
As for air transport services, Decree 1401/98 (November 27, 1998) contains the most recent
measures regulating the incorporation of new operato rs into the long-distance international air market,
concession arrangements and permits for air transport services.  The decree stipulates that concessions
may be granted to any national operator to operate international air transport services on routes not
included in Annex I thereto, since those routes are operated exclusively by Aerolíneas Argentinas, Ltd.
Construction
European Union (paragraph 174)
Could the Government of Argentina provide details as to the on current foreign participation and the role
of foreign firms in the Argentinean construction sector?
Could the Government of Argentina confirm when does it intend to implement the 1995-1999 Investment
Programme?WT/TPR/M/47
Page 98
Professional services
Canada
The Secretariat's Report provides almost no information regarding the professional services sector.
Given that Argentina is a significant importer and exporter of professional services, information
regarding this sub-sector would have been desirable.
Information on this sector can be found in the responses to the questionnaire on accounting
services prepared under the Working Party on Professional Services.
Electronic commerce
Australia
What is Argentina’s trade policy regarding electronic commerce?  We understand that no legal
framework has yet been established, and we wish to know  if Argentina will impose tariffs on international
electronic commerce.
IV. OTHERS
(On WTO Dispute Settlement)
With reference to Section 3.4.2, paragraph 12, could Argentina provide details on the operational
fine-tuning it believes is necessary for the WTO dispute settlement mechanism?
Could Argentina indicate which provisions of the di spute settlement mechanism should be adjusted and
the nature of any proposed adjustments?
Could Argentina indicate which rules of the disput e settlement mechanism need further interpretation?
This subject is of vital interest to our country and is being analyzed and discussed during the
review of the Dispute Settlement Understanding bein g carried out by the Dispute Settlement Body.  Our
country is participating actively in this process.
USA
(Tax Registry)
In Section III, paragraph 8, the Secretariat document states that the trade registry is open to operators in
possession of a Tax Identification Number.  Does e veryone have a Tax Identification Number?  If not,
what is involved in getting such a number?
All private and corporate parties have a tax identification number (CUIT) for fiscal management
purposes, including employees.
__________