IV
107TH CONGRESS
1ST SESSION
H. RES. 27
Strongly urging the President to file a complaint at the World Trade Organi-
zation against oil-producing countries for violating trade rules that pro-
hibit quantitative limitations on the import or export of resources or
products across borders.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 31, 2001
Mr. DEFAZIO submitted the following resolution; which was referred to the
Committee on Ways and Means
RESOLUTION
Strongly urging the President to file a complaint at the
World Trade Organization against oil-producing coun-
tries for violating trade rules that prohibit quantitative
limitations on the import or export of resources or prod-
ucts across borders.
Whereas no free market exists in oil production because of
collusion among large oil-producing countries;
Whereas the Organization of the Petroleum Exporting Coun-
tries (OPEC) and other oil-producing countries have re-
peatedly agreed to coordinated cutbacks in production,
thus manipulating world oil markets, resulting in de facto
price fixing;
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Whereas this manipulation led to the highest price per barrel
of oil in nearly a decade, substantial increases in con-
sumer prices for items such as home heating oil and gas-
oline, and continued price volatility;
Whereas rising oil prices greatly harm consumers, farmers,
small businesses, and manufacturers, increase the likeli-
hood of inflation, increase the cost of conducting inter-
state and international commerce, and pose a strong
threat to continued economic growth;
Whereas article XI of the General Agreement on Tariffs and
Trade (GATT 1994) prohibits members of the World
Trade Organization (WTO) from setting quantitative re-
strictions on the import or export of resources or prod-
ucts across their borders; specifically the language reads
‘‘No prohibitions or restrictions other than duties, taxes
or other charges, whether made effective through quotas,
import or export licenses or other measures, shall be in-
stituted or maintained by any contracting party on the
importation of any product of the territory of any other
contracting party or on the exportation or sale for export
of any product destined for the territory of any other
contracting party.’’;
Whereas the precise meaning of this provision was spelled out
in a GATT Panel Report issued in 1988 entitled
‘‘Japan—Trade in Semi-conductors’’, which noted, ‘‘. . .
this wording [in article XI] was comprehensive: it applied
to all measures instituted or maintained by a contracting
party prohibiting or restricting the importation, expor-
tation or sale for export of products other than measures
that take the form of duties, taxes, or other charges . . .
This wording indicated clearly that any measure insti-
tuted or maintained by a contracting party which re-
•HRES 27 IH
stricted the exportation or sale for export of products was
covered by this provision, irrespective of the legal status
of the measure.’’;
Whereas oil production restrictions clearly qualify as a
‘‘quantitative restriction’’ based on the original WTO
rules and the 1988 GATT panel report, which certify
that only ‘‘duties, taxes or other charges’’ are allowable,
not pacts among countries to limit production of a prod-
uct for export;
Whereas article XX of GATT 1994, which sets out a series
of exceptions to article XI, notes that none of the excep-
tions are valid if they are ‘‘applied in a manner which
would constitute . . . a disguised restriction on inter-
national trade’’, a phrase which describes OPEC’s pro-
duction restrictions;
Whereas of the 11 OPEC countries, 6 are members of the
WTO (Kuwait, Indonesia, Nigeria, Qatar, Venezuela, and
United Arab Emirates), 2 have observer status and have
applied to join the WTO (Saudi Arabia and Algeria), and
only 3 have no relationship with the WTO (Libya, Iran,
and Iraq);
Whereas of the remaining large oil-producing countries, Mex-
ico and Norway are members of the WTO, and Russia
and Oman have applied for membership; and
Whereas given the substantial WTO membership and pending
membership of oil-producing countries, filing a complaint
would likely have an immediate impact on the current
and future behavior of these countries: Now, therefore, be
it
Resolved, That the Congress strongly urges the Presi-
dent of the United States to file a complaint in the World
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Trade Organization against oil-producing countries for
violating their obligations under the rules of that organiza-
tion.
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