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TWN Info Service on WTO and Trade Issues (Aug14/01)
01 August  2014
Third World Network

Misplaced claims of deadline sanctity for TFA
Published in the South-North Development Monitor (SUNS) #7855 dated 31 July 2014

Geneva, 30 Jul (Chakravarthi Raghavan*) - The impasse at the WTO General Council over the adoption of a Protocol of Amendment to incorporate the Trade Facilitation Agreement (TFA) into Annex 1A of the Marrakesh agreement, and much of the discussions thereon at the WTO have focused on the importance of meeting the deadline of July 31, 2014 included in the Bali Decision on the TFA (WT/MIN(13)/36, WT/L/911, 7 December 2013), and the WTO losing all credibility.

Missing the indicative deadline in the Bali Decision is represented by some WTO Members as tantamount to ‘killing the Bali Agreement' and as jeopardizing good faith and good will in the negotiations.

However, if the deadline for the TF protocol is missed, it will be one of a long line of ‘missed deadlines' from the inception of the WTO on 1 January 1995: those mandated by Ministerial Conferences and thus ‘Ministerial political commitments', and those missed in terms of legally binding mandated deadlines set by the Marrakech Treaty.

A review of the track record of the WTO negotiations under the Doha mandate reveals a long list of missed deadlines and unfulfilled obligations. Many of these missed deadlines and unfulfilled obligations are central to the demands of developing countries and the fulfilment of the development mandate under the Doha negotiations, and a vast majority of missed deadlines is because of the US and developed countries withholding consensus.

Based on Bali Decision on the TFA (WT/MIN(13)/36, WT/L/911, 7 December 2013), the Preparatory Committee on Trade Facilitation was mandated by the Ministerial Conference held in Bali to draw up a Protocol of Amendment to insert the TFA into Annex 1A of the WTO Agreement, thus making it part of the WTO law and a covered agreement under the WTO Dispute Settlement Understanding. The Bali Decision provided that "the General Council shall meet no later than 31 July 2014 to ... adopt the Protocol drawn up by the Preparatory Committee...". The Preparatory Committee on Trade Facilitation was established under the General Council, and is open to all WTO Members.

The General Council meeting held on the 24th and 25th of July 2014 heard a report on the TFA from the Chairman of the Preparatory Committee on Trade Facilitation and the positions of several WTO Members in regard to the Agreement. The discussion on the Protocol that will amend the Marrakesh Agreement establishing the WTO to insert the TFA in its Annexes (hereafter referred to as the ‘Protocol') was suspended due to lack of consensus.

Several developing country Members, including India, South Africa, Bolivia, Cuba, Venezuela, Zimbabwe, and the Solomon Islands had taken the position that the TFA is not a stand-alone agreement, and that its entry into force must be part of the single undertaking under the Doha negotiations (see SUNS #7853 dated 28 July 2014).

In the meetings of the Preparatory Committee on Trade Facilitation, these countries had asked that their position be reflected in the content of the Protocol, through inserting specific language subjecting the entry into force of the TFA to the conclusion of the single undertaking in the Doha Work Programme, as agreed upon in paragraph 47 of the Doha Ministerial Declaration. WTO Members taking this position often highlight that they have difficulty joining a consensus on the ‘Protocol' while no progress has been made on the areas of interest to developing countries, including the elements of the Bali package where a permanent binding solution was not achieved at the Bali Ministerial Conference.

["According to Mr. Jayant Dasgupta, then Indian ambassador to the WTO, the agenda and format of the Prepcom precluded any discussion of other parts of the Bali package, including the food security issue. The earliest this was possible in a comprehensive manner was at the General Council, negotiations on the other parts of the Bali package having been remitted to different bodies in the WTO."]

Some Members have argued that a failure to meet the deadline of 31 July 2014, set in the Bali Ministerial Decision on the TFA, would be considered a breach of the Bali mandate agreed by Ministers and would put the credibility of the WTO at stake.

In his statement at the General Council session on 25 July, Deputy US Trade Representative Ambassador Michael Punke focused on the importance of keeping commitments and taking obligations seriously at the WTO. In regard to the outcomes of the Bali Ministerial, the United States Ambassador said that "there are specific commitments... which we have made to each other, including the implementation deadlines for the Trade Facilitation Agreement. Today a small number of WTO Members are indicating that they may no longer stand by their commitments to implement the TFA". He added that the deadline of July 31st "is fixed and firm".

The US statement added: "we are extremely discouraged that a small handful of Members in this organization [WTO] are ready to walk away from their commitments at Bali, to kill the Bali agreement, to kill the power of that good faith and goodwill we all shared, to flip the lights in this building back to dark".

South Africa, in its statement to the General Council on 25 July, reminded WTO Members that the "repeated failure to deliver meaningful outcomes on issues of interest to the poorest members ... can equally be characterised as harming the credibility of our organisation [WTO]".

The years of the Doha Round saw multiple deadlines being missed and commitments unfulfilled, many of which are directly concerned with the development mandate under the Round.

The whole Doha Round was scheduled to be finalised by 1 January 2005. The Doha Ministerial Declaration provides that "the negotiations to be pursued under the terms of this declaration shall be concluded not later than 1 January 2005" (see paragraph 45 of the Doha Ministerial Declaration, WT/MIN(01)/DEC/1).

Soon after the Doha meet and declaration, Mr. Pascal Lamy (the EU trade commissioner at that time) went before the EU parliament to present and explain the Doha Work Programme (DWP), and then told an informal meeting of the EUPs that he had bought Europe 10 years for CAP program changes - as the DWP could not be completed for at least 10 years. He also went to India to tell businessmen etc that EU cannot cut agri-subsidies since it needs to keep farmers on the land (SUNS #7300, ‘From bicycle to snowball approach to policy', February 2012).

After missing that deadline, ministers at the Hong Kong Ministerial Conference in 2005 agreed to "complete the Doha Work Programme fully and to conclude the negotiations launched at Doha successfully in 2006". This target was also missed.

In the area of agriculture, a priority issue for developing countries, the Doha Ministerial Declaration provided that "modalities for the further commitments, including provisions for special and differential treatment, shall be established no later than 31 March 2003" (see paragraph 14 of the Doha Ministerial Declaration, WT/MIN(01)/DEC/1). This deadline went unfulfilled.

Later at the Hong Kong Ministerial Conference (2005), Ministers set the date of 30 April 2006 to complete disciplines on export credits, export credit guarantees or insurance programmes, exporting state trading enterprises and food aid, including appropriate provisions in favour of least-developed and net food-importing developing countries (see paragraph 10 of the Hong Kong Ministerial Declaration - WT/MIN(05)/DEC). This deadline was again missed. (see SUNS #6092 dated 18 August 2006.)

During the post-Bali discussions held in the Committee on Agriculture, some WTO Members attempted to discard the revised draft modalities for agriculture reached in 2008 (TN/AG/W/4/Rev.4, 6 December 2008), which are the result of years of intensive negotiations. Except for the US, everyone was ready to accept or were willing to work on the basis of the 2008 Rev.4 which, among others, would update the Agreement on Agriculture such that the procurement for public stockholding purposes from low income or resource poor farmers in developing countries would not be taken into account for AMS calculations.

At the 2005 Hong Kong Ministerial Conference, WTO Members had agreed to the elimination of all forms of export subsidies by the end of 2013. The Hong Kong Ministerial Declaration (WT/MIN(05)/DEC) provides that WTO Members "... agree to ensure the parallel elimination of all forms of export subsidies and disciplines on all export measures with equivalent effect to be completed by the end of 2013". This is another deadline that remains unfulfilled.

Similarly, Ministers agreed in the 2005 Hong Kong Ministerial Declaration that the modalities for non-agricultural market access (NAMA) were to be established no later than 30 April 2006, but this became another missed deadline.

Several deadlines were missed in regard to the issue of cotton. Ministers convening at the Hong Kong Ministerial Conference had reaffirmed commitment to ensure an explicit decision on cotton within the agriculture negotiations. They agreed to work through the Sub-Committee on Cotton ambitiously, expeditiously, and specifically, and to eliminate all forms of export subsidies for cotton provided by developed countries in 2006 (see paragraph 11 of the Hong Kong Ministerial Declaration WT/MIN(05)/DEC).

In the area of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and public health, WTO Members originally set themselves until 1 December 2007 to formally amend the TRIPS Agreement through ratifying the Protocol of Amendment of the TRIPS Agreement, adopted by the General Council on 6 December 2005. The amendment will formally be built into the TRIPS Agreement when two thirds of the WTO's members have accepted the change (For more information, see .

The deadline has been extended four times. The latest General Council decision of 26 November 2013 (document WT/L/899) extended the deadline to 31 December 2015 (see http://www.wto.org/english/tratop_e/trips_e/amendment_e.htm)

Under the General Agreement on Trade in Services (GATS), Article X provides for a built-in negotiations mandate on emergency safeguard measures. Article X.1 of the GATS provides that: "There shall be multilateral negotiations on the question of emergency safeguard measures based on the principle of non-discrimination. The results of such negotiations shall enter into effect on a date not later than three years from the date of entry into force of the WTO Agreement". This, in addition to the mandate to negotiate multilateral disciplines to avoid trade-distortive effects of subsidies (Article XV of GATS), has not been fulfilled.

Several of the deadlines set in the Marrakesh Treaty in terms of mandated further work programme have also been missed. For example, the deadline of end 1998, set under that Treaty for taking and completing a work programme on harmonisation of MFN Rules of Origin (Art. 4.2 of the Agreement on Rules of Origin) remains unfulfilled. The Work programme went on and on, and then some issues were referred to the General Council for decisions, where they remain bottled up and without conclusion or even consideration (see SUNS #7816 dated 4 June 2014 and #7815 dated 3 June 2014).

In the General Council session held on 25 July 2014, a Member had sounded disappointment with the double standards and selective approach reflected by the narrative of some Members when addressing the agreements undertaken in Bali compared to the agreements and commitments agreed over the course of the Doha negotiations before the Bali ministerial conference. This Member noted that some commitments undertaken prior to the Bali Ministerial Conference have been entirely unfulfilled, such as the elimination of cotton subsidies, among others. This Member added that several of the rulings by the WTO Dispute Settlement Body (DSB) have been ignored as well.

For example, the United States failed to comply with the ruling of the panel, the Appellate Body and the compliance panel in the case addressing measures affecting the cross-border supply of gambling and betting services (US - Gambling). The case had started with a request for consultations in March 2003. The panel report was issued in November 2004, while the Appellate Body report was issued in April 2005. The complainant - Antigua and Barbuda - requested authorization from the DSB, pursuant to Article 22.2 of the Dispute Settlement Understanding (DSU), to suspend the application to the United States of concessions and related obligations of Antigua and Barbuda under the GATS and the TRIPS Agreement, and requested the DSB to authorize the suspension of concessions and obligations to the United States in respect of intellectual property rights (http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds406_e.htm)

Similarly, the United States failed to comply with the ruling of the Appellete Body in the case on measures affecting the production and sale of clove cigarettes (US - Clove Cigarettes). Consequently, on 12 August 2013, Indonesia requested the authorization of the DSB to undertake remedial action through suspending concessions or other obligations pursuant to Article 22.2 of the DSU (http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds406_e.htm).

(* This is a comment by the Editor Emeritus of the SUNS, with contributions from Kinda Mohamadieh.)

 


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