REGIONAL TRADE AGREEMENTS: NEGOTIATIONS

Negotiations on RTAs

WTO members have sought to clarify and improve WTO disciplines on regional trade agreements (RTAs) as part of the Doha Round of negotiations launched in 2001. Since then, members have established a provisional Transparency Mechanism to review RTAs and have also agreed to hold discussions on the implications of RTAs on the multilateral trading system.

The Doha mandate
> The Doha mandate explained
> Negotiating Group on Rules

Assessing whether RTAs meet WTO rules has been challenging as the interpretation of the rules remains open to debate. As such, members in 2001 agreed in the Doha Declaration to negotiate with the aim of “clarifying and improving disciplines and procedures under the existing WTO provisions applying to regional trade agreements.” It also states that “the negotiations shall take into account the developmental aspects of regional trade agreements”. More information on issues that were under discussion is available here.

Negotiations on RTAs fall under the work of the Negotiating Group on Rules, which reports to the Trade Negotiations Committee (TNC). More information on the negotiating group is available here.

 

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Transparency Mechanism to review RTAs

A 2006 General Council Decision established the provisional Transparency Mechanism for RTAs, making it the first result from the negotiations. The mechanism clarified requirements regarding the timing of notification of RTAs to the WTO and established a process by which these RTAs are considered by WTO members--either in the Committee on RTAs or the Committee on Trade and Development--on the basis of a factual presentation by the WTO Secretariat. The WTO database on RTAs was also established under the Transparency Mechanism.

At the 10th Ministerial Conference in Nairobi in 2015, WTO members agreed to work towards the transformation of the current provisional Transparency Mechanism into a permanent mechanism, without prejudice to questions related to notification requirements.

 

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Proposals to clarify and improve disciplines on RTAs

On clarifying and improving the disciplines on RTAs, proposals have been made regarding various elements of the rules, to which there have been divergent reactions.

Proposals were made in particular on how to define the phrase “substantially all the trade” in Article 24 of the General Agreement on Tariffs and Trade (GATT) 1994, which states that customs unions and free trade areas are permitted if they eliminate tariffs and other restrictive regulations of commerce on substantially all the trade between the parties. Proposals have also focused on special and differential treatment for developing countries.

 

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Implications of RTAs on the multilateral system

In the Nairobi ministerial declaration issued in December 2015, ministers instructed the Committee on RTAs to discuss the systemic implications of RTAs for the multilateral trading system and their relationship with WTO rules.