TWN Info Service on WTO and Trade Issues (Feb10/06)
17 February 2010
Third World Network

“Good Progress” during NAMA week, says Chair
Published in SUNS #6859 dated 9 February 2010

Geneva, 8 Feb (Kanaga Raja) -- A week of negotiations on market access for non-agricultural products (NAMA), devoted mainly to trying to achieve convergence on various proposals on Non-Tariff Barriers (NTBs), was a "very constructive one", with Members moving forward "slowly, but surely".

This assessment of the negotiations that took place from 2-5 February was provided by the Chair of the NAMA Negotiating Group, Ambassador Luzius Wasescha of Switzerland.

At a press briefing following the conclusion of an informal NAMA meeting Friday afternoon, Ambassador Wasescha said that the NAMA week was a "very constructive one", with Members being engaged by providing proposals and other Members reacting to the proposals.

"We moved forward, slowly but surely," the Chair said.

"Good progress, business-like atmospherics, engagement by Members and willingness to do the homework in order to progress, the idea being to have texts with a high degree of maturity in possibly all areas," he further said, in summing up the week of talks.

According to trade officials, the NAMA week was used by Members to try to achieve convergence on different proposals on NTBs, in particular, NTBs concerning standards, technical regulations and conformity assessment procedures for automotive products; Technical Barriers to Trade-related NTBs in electronics; the horizontal mechanism (for resolving NTB-related problems without the need to go to the dispute settlement mechanism); re-manufactured goods; and textile labeling.

In respect of automotive products TBT-related NTBs (proposals TN/MA/W/120 and 126 by the US and TN/MA/W/118/Rev. 1 by the EU), there has not been much progress, said trade officials.

A "non-paper" was presented by the European Union as an "Agreement" in legal language, which incorporates Members' suggestions, according to the EU.

According to trade officials, the EU aims to address the problem of the divergence in standards in the auto industry that prevents any car built in one country from being sold in another without modifications for the specific market.

The US considered the proposal to be "unrealistic". Japan defended the different standards and regulations, as they are adapted to different realities in different countries, such as geography, climate, density of population, etc.

According to trade officials, Korea said that the EU proposal was "too ambitious". Canada said that the proposal has fundamental implications for the Technical Barriers to Trade (TBT) Agreement.

The Chair said that one fundamental question is the level of ambition. Or to put it differently, "how far do we want to go in having a TBT-plus on the question of standard setting," he asked.

On the issue of electronics-related NTBs (Annex 5-XI by the US, and Annex 5-VI by the EU, of TN/MA/W/103/Rev. 3 and TN/MA/W/119 and 129), trade officials said that there was a lengthy technical discussion on the scope, the standards, the conformity assessment and the transparency provisions, based on a new merged text submitted by Canada, that would incorporate Members' proposals and concerns.

Substantive differences still remain between the EU and the US, in particular on what kind of standards are to be used.

On the Horizontal Mechanism (TN/MA/W/106 in Annex 5-I of TN/MA/W/103/Rev. 3), the US said that it does not want such a mechanism.

According to trade officials, mindful of the strong support for a mechanism among the Membership, the US has submitted texts to try to dilute the EU and other Members' proposal.

A new revised text for a "Ministerial decision on procedures for the facilitation of solutions to Non-Tariff Barriers" (TN/MA/W/106/Rev. 1) was submitted by the African Group, Canada, the European Union, the LDC Group, the NAMA-11, the Group of Developing Countries, New Zealand, Norway, Pakistan and Switzerland.

The proposed Ministerial decision sets out procedures for addressing concerns regarding NTBs in two stages.

In the first stage concerning request and response on a specific NTB, the proposal says that any Member (the requesting Member') may, individually or jointly with other Members, initiate Stage I of these procedures by submitting in writing to another Member (the responding Member') a request for information regarding a non-tariff barrier. The request shall identify and describe the specific measure at issue and provide a detailed description of the requesting Member's concerns regarding the measure's impact on trade.

"The responding Member shall provide, within [20] days, to the extent practicable, a written response containing its comments on the information contained in the request. Where the responding Member considers that a response within [20] days is not practicable, it shall inform the requesting Member of the reasons for the delay, together with an estimate of the period within which it will provide its response."

The proposal further states that upon submission, the requesting Member shall notify its request to the relevant WTO Committee, which shall circulate it to all Members. The responding Member shall equally notify its response to the relevant WTO Committee, which shall circulate it to all Members.

Following the receipt of these notifications, upon the request of either the requesting or the responding Member (hereinafter referred to as "the parties"), the Chairperson or one of the Vice Chairpersons of the relevant WTO Committee shall convene a meeting with the parties to inter alia address any outstanding issues and explore possible next steps.

In stage two concerning resolution procedures, the proposal states that following the initial information exchange under Stage I, the parties shall decide on whether to proceed to Stage II of these procedures. Stage II of these procedures may only be initiated by mutual agreement of the parties.

However, if one of the parties requests to proceed to Stage II of these procedures, the other party shall accord sympathetic consideration to that request.

The parties shall notify any decision to proceed to Stage II to the relevant WTO Committee, which shall circulate it to all Members.

"Any other Member may submit a written request to the parties, within [10] days of notification under paragraph 10 (the preceding paragraph above), that it be permitted to participate in these procedures as a third party. Such other Member may participate in these procedures if both parties so agree and on the terms agreed to by the parties."

Once initiated, Stage II shall be terminated upon request of either party, says the proposal.

Other provisions of the proposal relate to the appointment of a facilitator, the issue of confidentiality, transparency, and technical assistance.

On the issue of outcome and implementation, the proposal states that upon termination of Stage II of these procedures by a party or in the event that the parties reach a mutually agreed solution, the facilitator shall issue to the parties, in writing, a draft factual report, providing a brief summary of (1) the NTB at issue in these procedures; (2) the procedures followed; and (3) any mutually agreed solution reached as the final outcome of these procedures, including possible interim solutions.

The facilitator shall provide the parties [15] days to comment on the draft report. After considering the comments of the parties submitted within the period, the facilitator shall submit, in writing, a final factual report to the relevant WTO Committee within [15] days of receiving the comments. The factual report shall not provide any interpretation of the WTO Agreement regardless of any prior reports of the panels or the Appellate Body of the DSU.

If the parties reach a mutually agreed solution, such solution shall be implemented in conformity with the WTO Agreement, says the proposal.

On the issue of application and review, the proposal says that the Council for Trade in Goods and the relevant Committees shall apply this Decision and implement it within the framework of their work from the date of the adoption of this Decision. The Council for Trade in Goods and each Committee to which this Decision applies may decide, by consensus, to modify certain procedural aspects of this Decision. Any modifications shall apply only within the Council or Committee that has adopted the modifications and only to procedures initiated after the date of effectiveness of the decision on the modifications.

In light of experience gained from the operation of these procedures, the [Council for Trade in Goods] will undertake a review of the effectiveness of the procedures under this Decision no later than [5] years after the adoption of this Decision. Based on this review, Members may decide on whether to extend these procedures to other matters falling under the WTO Agreement or otherwise modify these procedures, it concludes.

According to trade officials, the US continued to favour a "committee first approach", in which problems should be taken to the respective committees and resolved there.

Another issue raised was in regards to the scope of the mechanism. Japan, Korea and Chinese Taipei, amongst others, said that it should not apply to SPS (sanitary and phyto-sanitary standards).

The Chair said that the first conceptual difficulty is whether Members want "a fast sailing boat" (pragmatism) or "a huge aircraft carrier" that incorporates all the legal considerations (perfection).

On the issue of re-manufactured goods, a proposal was tabled by the US, Japan and Switzerland (TN/MA/W/18/Add. 16/Rev. 3 and TN/MA/W/124).

The proposal is for a work programme in the Council for Trade in Goods with the aim of discussing Members' progress in reducing or eliminating NTBs in the area of re-manufactured goods.

According to trade officials, some developing countries remain skeptical of the need for a work programme, the legal definition to be adopted for these kinds of goods, and the supposed benefits for the goods. The developing countries see it as a way to "dump waste" from developed countries onto them or as an unfair form of trade.

On the labelling of textiles, clothing, footwear and travel goods (TN/MA/W/93/Rev. 1 and W/123), a proposal was tabled by the EU, Mauritius, Sri Lanka and the US.

According to the Chair, the NAMA group is close to a text-based negotiation on this issue.

Also on Friday, Argentina and Brazil introduced a new paper entitled "Understanding to facilitate the implementation of the TBT Agreement as applied to trade in the chemical products sector" (TN/MA/W/135).

The paper will be discussed further at the next NAMA week in mid-March. +