MARKET ACCESS: QUANTITATIVE RESTRICTIONS
Article XI of the GATT 1994 is the main provision regulating quantitative restrictions (QRs). The scope of this provision includes all prohibitions or restrictions other than tariffs or other taxes applied or maintained by a WTO Member on the importation or exportation of goods, which can be made effective through quotas, import or export licensing procedures, or other measures. Although Article XI of the GATT provides for the general elimination of quantitative restrictions, they are allowed in certain specific circumstances. Members' QR notifications seek to provide transparency on these measures, including on its WTO justification.
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There are different measures which the GATT and WTO jurisprudence has considered to fall under the scope of Article XI:1, which extends to "prohibitions or restrictions other than duties, taxes or other charges" on imports and exports of goods thatcan be "made effective through quotas, import or export licences or other measures". While the general elimination of quantitative restrictions covers all import and export related measures, including seasonal and de facto measures, the GATT and certain WTO Agreements allow them under specific circumstances. These include, for example, Articles XI:2, XII (balance of payments), XX (general exceptions) and XXI (national security exceptions) of the GATT. Authorization to impose them may also result from waivers, such as the one approved by the WTO concerning the Kimberley Process Certification Scheme for Rough Diamonds.
Several WTO Members have notified that they maintain quantitative restrictions in one form or the other, including widely used measures such as prohibitions or restrictions relating to trade in nuclear materials, narcotic drugs, weapons, and several measures to protect the environment. In some cases, these prohibitions or restrictions to trade result from international obligations undertaken outside the WTO framework, including inter alia the Montreal Protocol on substances that deplete the ozone layer or the CITES Convention to protect trade in endangered species. To the extent these measures fall under the scope of Article XI, they shall also be notified to the WTO and justified under the relevant rule.
When a Member introduces or maintains a quantitative restriction, it must ensure that it is administered in a non-discriminatory manner, including the provisions of Article XIII of the GATT. It must also notify them to the WTO at regular intervals and indicate, in its opinion, what WTO provision would allow it to introduce or maintain such measure. This notification requirement was introduced through a Decision on Notification Procedures for Quantitative Restrictions, which was adopted by the Council for Trade in Goods on 22 June 2012 (the QR Decision). The QR Decision provides for the type of information, format, and interval in which Members need to notify the quantitative restrictions they maintain, but also allows for the possibility to notify measures imposed by other members ("reverse notifications").
According to the Decision on Notification Procedures for Quantitative Restrictions, Members must notify all quantitative restrictions in force beginning on 30 September 2012 and at two yearly intervals thereafter. The Decision provides for a specific format for notification (Annex 1) and an indicative list of measures to be notified (Annex 2), as well as a number of measures that should not be notified. The notification can be submitted in any of the three WTO official languages and its content is not usually translated.
Scope of the QR Decision
Indicative list of measures to be notified
|2. Prohibitions except under defined conditions|
|3. Global quotas|
|4. Global quotas allocated by country|
|5. Bilateral quotas|
|6. Non-automatic import licensing|
|7. QRs made effective through state trading operations|
|8. Mixing regulations|
|9. Minimum price|
|10. Voluntary export restraints|
Measures not covered
1. SPS measures
2. TBT measures
3. Automatic import licensing
4. Tariff Rate Quotas (TRQs)
A number of information can be found in these notification, such as a general description of the measure and whether it applies to imports and/or exports, the affected products, legal justification under a WTO agreement, as well as the reference to the national legal instrument. If information on existing quantitative restrictions has already been provided to other WTO committees, Members can make a cross-reference to the relevant document so that information on a specific measure can be easily retrieved.
The Secretariat periodically produces a report with factual information on notifications received, which can be accessed here. To date, most of the notified measures refer to prohibitions and restrictions made effective through non-automatic licensing requirements. The large majority of these measures have been considered by the notifying Member to be justified by the following provisions:
- Article XX:(b) of the GATT 1994: measures necessary to protect human, animal or plant life or health;
- Article XX:(g) of the GATT 1994: measures related to the conservation of the environment;
- Article XXI:(b) of the GATT 1994: actions it considers necessary for the protection of its essential security interests.
Paragraph 4 of the Decision mandates the Secretariat to compile all quantitative restrictions notified in a Quantitative Restrictions Database, which is accessible to the public. The database allows users to query information by product, type of measure, trading partner, etc. The notified measures can also be accessed directly through Documents Online, or in an aggregated manner through the Integrated Trade Intelligence Portal (I-TIP).
Committee on Market Access
The Committee on Market Access is responsible for overseeing the Decision on Notification Procedures for Quantitative Restrictions, which includes reviewing Members' use of these measures. When a Member submits a notification on quantitative restrictions, it is automatically included in the agenda of the next meeting of the Committee, so that Members have the opportunity to review the notification and submit questions, if necessary. The minutes of these discussions can be accessed through Documents Online.
Disputes concerning quantitative restrictions
There has been considerable jurisprudence in the WTO concerning the interpretation of Articles XI and XIII of the GATT. In particular, the text of Article XI was considered by several Panels very broad in scope, covering all measures prohibiting or restricting the importation, exportation, or sale for export of products other than measures taking the form duties, taxes or other charges. These include restrictions which constitute a limitation on action, a limiting condition or regulation, as well as de facto restrictions or restrictions based on the design of the measure and its potential adverse effect on trade. Certain regulatory regimes, discretionary licensing schemes, price requirements, and restrictions on circumstances of importation have been considered quantitative restrictions by the WTO jurisprudence.
For more information on quantitative restrictions, including the jurisprudence, see the WTO Analytical Index: