Substance of Accession Negotiations


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5.1 General points



Economic policies  back to top

WTO Members request applicants to observe a standstill and not to introduce new restrictive measures while the accession negotiations are in progress.

Some Members have argued in the General Council/Ministerial Conference that new entrants should not be required to undertake Protocol commitments that are more stringent than those of original WTO Members at similar levels of economic development (sometimes referred to as WTO-plus commitments). Other Members have replied that Article XII places no limits on the terms of accession and that, in their view, the process is working well110. They have added that the terms on which new Members have acceded are the result of negotiations taking into account the needs and requirements in each case. Moreover, they are agreed in each case by the acceding government and the WTO membership. While there has been relatively little discussion on this subject in the WTO, three main points have emerged: Article XII indeed sets no limits to the terms that may be agreed; acceders have accepted more stringent commitments than original Members in some cases; and a consensus would have to be obtained for any change to take place in the current negotiating procedures. For their part, applicants have concentrated on negotiating specific terms rather than engaging in general debate that is unlikely to lead to an agreed result.

It appears that in some cases applicants have been asked to accept WTO-plus commitments because some Members considered that the State retained a significant degree of control over their economies. All of these applicants that have acceded to the WTO were in course of transition and were reducing the role of the State in the economy. In these cases, Members have wished to obtain details of the privatization programmes under way and the standard Protocol commitment, while going beyond the normal provisions of the WTO, has been simply to provide the WTO with reports on the implementation of those programmes.111 In addition, the Protocols of two new Members contain provisions relating to price comparisons used in anti-dumping investigations where market economy conditions cannot be shown to prevail. These commitments spell out the methodologies for identifying and measuring subsidy benefits.112 One of these countries, China, is by far the largest applicant to have acceded to the WTO. The terms on which it acceded are unique in important respects and are summarized in Box 5 below.

It appears that some other terms of accession more stringent than those of original WTO Members were negotiated to improve conditions of access to the markets of the new Members concerned or to reduce their ability to distort conditions of competition on world markets. Two examples are commitments to join the Civil Aircraft Agreement and to reduce the level of agricultural export subsidies to zero.

The stock response to general requests from acceding governments for special and differential treatment, reserved for developing and least-developed countries under the WTO agreements, has been that specific requests could be examined case-by-case. In this they were treated somewhat differently from original WTO Members. The WTO has allowed original WTO Members to decide for themselves whether they are developing countries and this procedure has stood the test of time.113

As a general rule, Members expect applicants to submit comprehensive legislative action plans outlining the work programme underway to achieve full conformity with all WTO rules by the date of accession. Very nearly all recent applicants have provided their Working Parties with comprehensive plans indicating the legislative and administrative action to be taken and projected dates for such action. They have proved to be a useful tool for the applicants. Action plans are, by definition, specific to the individual case and there is no set format but they are best presented in tabular form and arranged by WTO agreement. An example is given in Annex 13.1. Applicants, particularly least-developed countries, may add another column indicating their technical assistance needs.

Working Party members have, on occasion, requested that drafts of the legislation be presented to them for review before the accession process is completed. This has sometimes been questioned by governments sensitive of their sovereignty. There is no obligation to comply with this request and governments sometimes prefer to present legislation once it has been enacted. However, it has been argued that presentation of the draft legislation would be helpful to acceding governments as it would ensure that they did not ask their parliaments to pass texts which did not conform to WTO requirements. It has now become common for draft legislation to be presented, sometimes informally, for comments by interested members.

In order to obtain more information on key subjects such as subsidies, Members also occasionally ask the applicant to prepare a draft of the initial notifications that they will be required to submit once they become a Member of the organization.

Action plans dealing with specific subjects may also be required, in particular when Working Parties wish to reach a clear understanding of what needs to be done to bring the applicant’s legislation and practices into full conformity with each of the main provisions of WTO agreements. These more detailed plans frequently deal with subjects on which applicants have been asked to respond to questionnaires or checklists, such as customs valuation, technical barriers to trade, sanitary and phytosanitary regulations and trade-related intellectual property rights. An SPS plan is, for instance, typically based on the response to the checklist of obligations in the SPS Agreement and the action being taken to fill these gaps. An example is given in Annex 13.2.

During the negotiation of commitments, applicants have sometimes explained the difficulties that they will have in achieving conformity with WTO requirements in specific areas and have requested transitional periods granting them time to bring their laws, regulations and practices into line after they accede. This was more frequently the case in earlier accessions when applicants often expected to be accorded the same sort of transitional periods that WTO agreements accorded to original Members of the organization. However, Members have pointed out that the transitional periods for original Members have now expired. Their expectation has been that new Members observe the rules from the date of their accession to WTO. Accordingly, applicants are encouraged to use the accession process to familiarize themselves with WTO rules and adjust their legal, institutional, and administrative framework as the accession process advances. Protocol commitments therefore usually provide that new Members will abide by their obligations from the date of their accession. Members may, however, show a willingness to entertain requests for transitional periods in individual cases when applicants have demonstrated that they have done as much as possible to bring their system into line with WTO requirements. When necessary, an Action Plan can be provided to support the requests. A number of transitional periods have been agreed. Details will be found in sections below dealing with individual topics.

Transitional periods for LDCs are a feature of the General Council’s Guidelines, which provide that transitional periods foreseen under specific WTO agreements shall be granted to these countries, taking into account individual development, financial and trade needs and that these shall be accompanied by Action Plans for compliance with WTO rules, supported by technical assistance and capacity building measures for the acceding LDCs. Transitional periods are negotiated on the basis of Action Plans. Action Plans should demonstrate the applicant’s need for the transitional period, describe the extent to which its system is in compliance with WTO rules, and lay out the steps that remain to be taken, a calendar for progressive compliance and a date by which the applicant will be in full compliance (see example in Annex 13.2 ). LDCs may also include technical assistance needs, though not as a condition for compliance. Members expect that the existing degree of conformity with the provisions of the agreement will not be reduced during the transitional period, that transparency provisions are implemented as soon as possible and that critical provisions central to the issue of market access and the maintenance of a stable, predictable trade regime are in place at the time of accession to the WTO of the applicant concerned.114 If the basic legislation is not already in conformity with WTO requirements, they will normally wish to examine draft legislation before a decision is taken on the terms for granting the transitional period and normally expect this legislation to be implemented rapidly thereafter. Transitional periods have been granted to both LDCs that have already acceded.115 One small, vulnerable isolated developing country has been treated in much the same way as the LDCs.116

LDCs have been provided with technical assistance and assistance with capacity building in connection with their implementation of Action Plans for transitional periods and other aspects of the accession process on a priority basis. Discussion of the technical assistance to be provided has normally taken place outside the Working Parties and Members have not agreed to suggestions that the obligation to comply with the Action Plan be made conditional on receipt of technical assistance. The Action Plan as revised and incorporated in a Protocol commitment does not contain a column indicating the technical assistance to be provided. However, one Working Party Report contains a paragraph in which the representative of the country concerned made it clear that as an LDC with limited resources, infrastructure and institutional and technical capabilities, it would face serious difficulties to implement the WTO agreements expeditiously by its own means. This country’s action plans had identified the specific areas and projects where technical assistance would be welcome. The representative acknowledged assistance already received but added that additional technical assistance would be required with respect to these and other areas of WTO implementation as noted in the action plans.117

The implementation of the Guidelines has also streamlined the accession process for LDCs. Since the adoption of the Guidelines, substantive demands on LDCs have been moderated in some respects. The two LDCs that have already acceded were, for instance, not required to accept WTO plurilateral agreements and the obligations that they have undertaken in their Goods Schedules and Services Schedules are less onerous than those of other applicants that have acceded in recent years.118

Box 5:
Accession of China

China’s accession was exceptional for a number of reasons, including: the scope of reform — the object of domestic, legal and economic reform was to establish a socialist market economy in line with China’s basic national policy of opening to the outside world; the multiple trade instruments used in its different levels of government; the inclusion in its customs territory of areas where special regimes for tariffs, taxes and regulations are established (including border trade regions, minority autonomous areas, Special Economic Zones, open coastal cities, economic and technical development zones); and its very large size and rapid growth.

China’s accession package therefore includes a number of commitments which, in many ways, are unique. In particular, China’s accession documents include:

  • a transitional time-bound (until the end of 2008) special textiles and clothing safeguard clause119 and a transitional time-bound product-specific safeguard mechanism authorizing WTO Members to take action if imports from China cause market disruption120;
  • a transitional review mechanism for the review of the implementation of the WTO Agreement and the related provisions of China’s Protocol121;
  • text on non-discrimination for foreign individuals and enterprises and foreign-funded enterprises122;
  • a commitment that WTO Members phase out all prohibitions, quantitative restrictions and other measures they maintain against imports from China in a manner inconsistent with the WTO Agreement, or deal with them in accordance with mutually-agreed terms and timetables123.

Information on the other terms on which China acceded will be found in the relevant sections below. These provisions are often relatively detailed. They pay special attention, for instance, to: the uniform administration of its trade policies throughout its territory124; and price comparisons used during a transitional period in anti-dumping investigations where market economy conditions cannot be shown to prevail and methodologies for identifying and measuring subsidy benefits.125

China’s claim to receive the special and differential treatment accorded to developing countries was not agreed in full. For instance, a compromise was reached regarding its de minimis level of domestic support126 and its entitlement to special and differential treatment under the SCM Agreement.127

China was provided with a certain number of transitional periods to bring its laws and regulations into line with its WTO commitments.



110. See, for example General Council WTO document WT/GC/M/40/Add.3. back to text
111. See section on State ownership and privatization below. back to text
112. Viet Nam, para 255; China, paras 151, 152, Protocol I.15. back to text
113. Decision of the CONTRACTING PARTIES of 28 November 1979 on Differential and More Favourable Treatment for Developing Countries (“Enabling Clause”), GATT 1947 BISD, 26 S, p. 203. back to text
114. See, for example, Cambodia, para 83. back to text
115. Transitional periods were granted to Cambodia and Nepal for the implementation of the Agreements on Customs Valuation (Cambodia, para 92; Nepal, para 57), TBT (Cambodia, para 130; Nepal, para 97), SPS (Cambodia, para 141; Nepal, para 107), and TRIPS (Cambodia, para 205; Nepal, para 137). back to text
116. Tonga was granted transitional periods for the implementation of the Agreements on Customs Valuation (Tonga, paras 89 — 91) and TRIPS (Tonga, paras 167 — 169). back to text
117. Nepal, para 152. back to text
118. These topics are discussed in more detail in the relevant sections of this Handbook. back to text
119. China, para 242. back to text
120. China, Protocol I.16. back to text
121. China, para 322 and Protocol Section 18. Notifications to be made to: Council for Trade in Goods, Council for Trade-Related Aspects of Intellectual Property Rights, Council for Trade in Services, Committees on Balance-of-Payments Restrictions, Market Access (covering also ITA), Agriculture, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Subsidies and Countervailing Measures, Anti-Dumping Measures, Customs Valuation, Rules of Origin, Import Licensing, Trade-Related Investment Measures, Safeguards, Trade in Financial Services. back to text
122. China, paras 18, 19, 22, and 23 and Protocol I.3. back to text
123. China, Protocol I.17. back to text
124. China, paras 73 and 75 and Protocol I.2(A) and (B). back to text
125. China, para 151, Protocol I.15. back to text
126. China, para 235 (see section below on agricultural policies). back to text
127. China, para 171. China reserved its right to benefit from the provisions of Articles 27.10, 27.11, 27.12 and 27.15 while confirming that it would not seek to invoke Articles 27.8, 27.9 and 27.13 of the SCM Agreement. back to text




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