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DISPUTE SETTLEMENT: DISPUTE DS305

Egypt — Measures Affecting Imports of Textile and Apparel Products

This summary has been prepared by the Secretariat under its own responsibility. The summary is for general information only and is not intended to affect the rights and obligations of Members.

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Mutually Agreed Solutions notified under Article 3.6 of the DSU

Complaint by the United States.

On 23 December 2003, the United States requested consultations with Egypt concerning the tariffs applied by Egypt to certain textile and apparel products and the Decree of the President of the Arab Republic of Egypt No. 469 of the year 2001 (“Decree No. 469”) and any amendments, related regulations or other implementing measures.

The United States alleges that, in the Uruguay Round, Egypt agreed that: (a) it would remove a general prohibition on the importation of apparel and made-up textile products by January 1, 2002; (b) it would bind its duties under HS Chapters 61 (articles of apparel and clothing, knitted and crocheted) and 62 (articles of apparel and clothing, not knitted or crocheted) at an ad valorem rate of 46 percent in 2003, 43 percent in 2004 and 40 percent thereafter, and (c) it would bind its duties under HS Chapter 63 (other made up textile articles; sets; worn clothing) at an ad valorem rate of 41 percent in 2003, 38 percent in 2004, and 35 percent thereafter.

The United States alleges that, on December 31, 2001 Egypt issued Decree No. 469 which amended the customs duties applicable to a number of imported articles, including articles that enter under HS Chapters 61, 62 and 63, and imposed specific duties (i.e., in Egyptian pounds per piece of clothing), rather than ad valorem duties. The United States alleges that these specific duties greatly exceed Egypt’s bound rates of duty. According to the United States, the ad valorem equivalent of these duties ranges from 141 percent to 51,296 percent.

The United States considers that these tariffs, Decree No. 469 and any related measures are inconsistent with the obligations of Egypt under Article II of the GATT 1994 and Article 7 of the Agreement on Textiles and Clothing.

On 15 January 2004, the European Communities requested to join the consultations. On 22 January 2004, Egypt accepted the request.

On 20 May 2005, Egypt and the United States informed the DSB that they had reached a mutually agreed solution under Article 3.6 of the DSU.

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