WTO schedules of concessions have been changed on more than 460 occasions since 1995, so it is important for the Committee on Market Access to keep track of them (a list of the changes can be found here). These include a series of modifications necessary to reflect amendments to the Harmonized System, an international classification nomenclature administered by the World Customs Organization. Updating these legal instruments is critical to properly monitoring the hundreds of thousands of tariff concessions that have been negotiated in the WTO context, as schedules are intended to provide security, transparency and predictability to the multilateral trading system.

Members also examined a number of notifications on quantitative restrictions, which generally refer to prohibitions and restrictions that members implement to take account of a number of non-trade concerns, such as the protection of human, animal and plant health, the environment, or even national security concerns (more on the issue here). 

The WTO Secretariat presented a report summarizing the information that has been notified by members, according to which more than 80% of these measures relate to non-automatic licensing procedures and prohibitions. The products most frequently subject to these types of measures include chemical products, machinery and mechanical appliances, hazardous waste, and pharmaceutical products. The most frequently cited provisions justifying the imposition of these measures include Article XX(b) of the GATT 1994 – measures necessary to protect human, animal or plant life or health (40% of cases) – followed by Article XXI(b), which relates to actions members consider necessary for the protection of their national security. 

Finally, members notified the imposition of measures resulting from other international obligations outside of the WTO, including the Montreal Protocol on Substances that Deplete the Ozone Layer, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the Rotterdam Convention on Hazardous Chemicals and Pesticides, and the Basel Convention on Hazardous Wastes.

In addition to taking note of the recent liberalization of a number of products in Canada (communication can be found here), members discussed a number of trade concerns.

Argentina — law on auto-parts

Several members reiterated their concerns, already expressed at the last meeting of the Committee, about the use by Argentina of indirect taxes as a way of protecting and promoting domestic manufacturing, notably through the use of subsidies. Some members considered that the law 27263, Régimen de desarrollo y fortalecimiento del autopartismo argentino: beneficios e incentivos, that entered into force on 2 August 2016, may be inconsistent with GATT Article III on National Treatment on Internal Taxation and Regulation, and Article 3 of the Agreement on Subsidies and Countervailing Measures. The law, they added, is a step backwards in the positive path taken by the current Argentinian administration addressing key trade barriers.

Argentina took note of the concerns expressed by members and reiterated its commitment to convey them to Buenos Aires for their analysis. Argentina further added that it stands ready to clarify issues bilaterally with members.

China – Import tax on personal effects at the border

Following up on an issue raised at the meeting of the Council for Trade in Goods in November 2016, China was asked to clarify the increased import tax on personal effects for travellers applied since April 2016. According to some members, the import tax on certain goods appeared to be higher than the aggregate amount of bound tariff rates, import value added tax and consumption tax. They expressed concern that the customs duties for those goods might exceed the bound rates of duties and that a higher rate of internal taxes was being imposed only on imported goods. China was also asked to explain whether passengers choosing to pay most-favoured nation (MFN) rates on these goods could make an import declaration without being burdened with excessive procedures. 

China responded that, generally speaking, its regulations established that inward articles for personal use, such as personal effects for travellers, are subject to a flat duty rate.  In the meantime, there was no prohibition for those articles to be subject to the customs import duty, China said. With regard to the treatment of import goods and inward articles or personal effects, China explained that WTO members have different systems.  In order to facilitate customs clearance, China had established three categories for inward articles which corresponded to three flat duty rates: 15%, 30% and 60%. These corresponded to all relevant taxes and were not directly comparable to the bound duty.  China believed this tax to be consistent with WTO rules.

India — Customs duties on telecommunication and other products

Several members reiterated their concerns, already expressed at the last meeting of the Committee, on the customs duties imposed by India on telecommunication and other products, as well as on reports that India planned to impose duties on mobile phones as of 1 July 2017.  Some members took the floor to express their disagreement with the Indian view that these products could be considered as “new products” not covered by the Information Technology Agreement (ITA), and recalled that India’s bound duties on these products were 0%. They said that they found two additional information and communication technology (ICT) products for which India’s applied tariff was not in conformity with its binding commitment of 0% under its GATT’s schedule, namely digital still video cameras, and other electronic integrated circuits (EICs).

India intervened to reiterate that the main issue at stake was not the classification of the products, but rather the applicable tariff binding commitments. India believes that the goods in question were not covered under the ITA, which was signed by India in 1997. Subsequently, IT and telecom technologies had evolved with new applications and equipment which neither existed nor were even conceived at the time of signing the ITA. Therefore, the new products could not be considered as falling under the scope of the ITA, as they did not exist at the time India made the concessions.  

India said it was not intending to take any fresh commitments and reiterated that new products were not covered by the ITA.  Finally, it noted that some participants had recently concluded the ITA expansion in order to take account of new developments in technology, and India was not one of them. 

Next meeting

The next formal meeting of the Committee was provisionally scheduled for 22 September 2017.

More information about market access for goods and the work of the Committee on Market Access is available here.