TWN
Info Service on WTO and Trade Issues (Nov16/10)
11 November 2016
Third World Network
India opposes re-writing notification requirements
Published in SUNS #8351 dated 9 November 2016
Geneva, 8 Nov (D. Ravi Kanth) -- India has rejected a single template
prepared by the World Trade Organization Secretariat for complying
with the notification requirements in the Import Licensing Agreement
on grounds that it would amount to changing the balance of rights
and obligations, according to people familiar with the development.
Major industrialized countries, particularly the United States, endorsed
the single template drawn-up by the Secretariat under the pretext
of avoiding duplication and overlapping notifications.
During separate informal meetings of the WTO's Committee on Import
Licensing held on 17 October and 3 November, major developed countries
such as the United States, Australia, and Canada among others made
a sustained pitch for agreeing to a single template prepared by the
WTO Secretariat in which notification requirements were merged without
adhering to the specific requirements in the existing provisions of
the Agreement on Import Licensing Procedures.
In a restricted 13-page unofficial room document circulated on 10
October (RD/LIC/9) titled "Some ideas on how to address the issue
of overlapping notification requirements in the Agreement on Import
Licensing Procedures," the Secretariat admitted that it has prepared
a template "in response to some Members' request, asking the
Secretariat to elaborate further on overlapping notification requirements
under the Agreement, as well as on problems regarding the existing
notification templates."
The Secretariat, however, did not mention the names of the countries
that pressed for such a document. It maintained that there are overlapping
notification requirements in Articles 1.4 (a), Articles 5 and Article
8.2 (b) of the Agreement on Import Licensing Procedures.
Further, the Secretariat maintained that there are duplications in
existing templates, suggesting that notification requirements must
be specific and different to be effective.
"After years of practice, we have observed that due to the fact
that Article 1.4 (a), Article 5 and Article 8.2 (b) contain similar
notification requirements", which result in duplications.
It said "members are often puzzled by the question of which form
to use for notifications, in particular when they would like to notify
a change in the legislation/procedure, in which case either Article
5 or Article 8.2 apply."
The Secretariat said it "has prepared some ideas on a combined
notification form for Article 1.4 (a), Article 5 and Article 8.2 (b)"
which addresses the legal requirements of the agreement.
The two annexes under the Secretariat-created template include notification
under Articles 5, 1.4 (a) and/or 8.2 (b) of the agreement dealing
with "notifications on newly introduced measures or any procedure/legislation
in force but which have not been notified to the committee" and
"changes to the existing legislation/procedure which has been
notified to the committee."
The US, Australia, Canada, and Hong Kong-China among others endorsed
the Secretariat's new template during an informal meeting on 17 October
on grounds that it would enhance transparency and avoid duplication
in notifying the changes in import licensing measures by members,
according to people who took part in the meeting.
During the meeting, India asked those members who found the "notification
process repetitive" to share the "precise difficulties they
faced in the existing formats" in order to resolve the problems
in those formats.
India said "some Members seem to reject the existing formats
as those may not provide an ideal solution to their proposed database."
"However, the proposed database should not add to Members' prevailing
obligations," India argued, according to people who took part
in the meeting.
India said categorically that it "does not agree with the idea
of merging the three notification obligations into one single template,
because the three Articles operate at different levels - Article 1.4
(notification of source of publications which contain general rules
and procedures), Article 5 (notification of listed information at
product level), and Article 8.2 (notification of change in laws and
regulations)", and it would upset the rights and obligations
of members in the agreement.
Further, India pointed out that "notification of information
under one Article need not simultaneously trigger notifications in
the other two. For example, a minor change in law, say a change in
the designation of a licensing authority, would trigger a notification
under Article 8.2, but would not require any notification under Articles
1.4 or 5."
"The current architecture in the import licensing provisions
provide sufficient flexibility for Members to decide under which Article
a situation is to be notified," India argued.
Besides, detailed information such as "list of products subject
to licensing" is required to be notified only under Article 5,
while the other Articles, i. e. 1.4 and 8, do not ask this notification
information.
The Secretariat's merged format, according to India, "clubs together
all the information prescribed in three different Articles into one
template."
"Hence merging would lead to notifying something extra under
each Article that would actually qualify for notification in the other
Articles ... this would enhance notification obligations substantially,"
India maintained.
Despite India's disapproval of the merged format into a single template,
the developed countries led by the US made another bid at the informal
meeting on 3 November by raising the same issue in agenda item ten
under the title "Improving transparency in notification procedures
of the agreement - report of the chairperson on the informal consultations
held on 2 June, 17 October, and 3 November."
Prior to the formal meeting on 3 November, members held an informal
meeting in which the US made a strong case that the Secretariat's
template is merely aimed at rearranging notification requirements
but not changing the rights and obligations.
The US underscored the importance of transparency in notification
requirements, arguing that the Secretariat's template addresses the
concerns raised by members, according to people who took part in the
meeting.
India sharply questioned the US statement, pointing out that the new
template would result in changing the rights and obligations, as it
would impose onerous/intrusive requirements that are not part of the
provisions of the Agreement on Import Licensing Procedures, according
to people who took part in the meeting.
At the formal meeting when the agenda item 10 came up for discussion,
the developed countries, particularly the US, remained silent on approving
the template. The US did not demand that the template must be approved
at the formal meeting.
India, however, made a detailed statement at the formal meeting on
why it did not support "merging of two notification formats"
and how it would change/disturb "the fine balance of rights and
obligations in the Import Licensing Agreement."
India said there is no change in its stand, emphasizing that it "does
not endorse the idea of merging two formats N/1 and N/2."
It pointed out that "the three notification requirements provided
under Articles 1.4 (a), 5 and 8.2 (b) are quite different from each
other, and hence should not merge".
India provided detailed critique on why the merging of notification
requirements under three articles is unsustainable.
India said that "the cause of action in the three requirements
are different as is evident from the text of the Agreement:
* Article 1.4 (a) comes into play when rules on procedures for submission
of licensing applications are framed or modified.
* Article 8.2 (b) is invoked when there are any changes in laws and
regulations relevant to the Agreement.
* Article 5 is invoked when there is institution of import licensing
procedures.
[Article 5 of the Agreement on Import Licensing Procedures states:
[1. Members which institute licensing procedures or changes in these
procedures shall notify the Committee of such within 60 days of publication.
[2. Notifications of the institution of import licensing procedures
shall include the following information: (a) list of products subject
to licensing procedures; (b) contact point for information on eligibility;
(c) administrative body(ies) for submission of applications; (d) date
and name of publication where licensing procedures are published;
(e) indication of whether the licensing procedure is automatic or
non-automatic according to definitions contained in Articles 2 and
3; (f) in the case of automatic import licensing procedures, their
administrative purpose; (g) in the case of non-automatic import licensing
procedures, indication of the measure being implemented through the
licensing procedure; and (h) expected duration of the licensing procedure
if this can be estimated with some probability, and if not, reason
why this information cannot be provided.
[3. Notifications of changes in import licensing procedures shall
indicate the elements mentioned above, if changes in such occur.
[4. Members shall notify the Committee of the publication(s) in which
the information required in paragraph 4 of Article 1 will be published.
[5. Any interested Member which considers that another Member has
not notified the institution of a licensing procedure or changes therein
in accordance with the provisions of paragraphs 1 through 3 may bring
the matter to the attention of such other Member. If notification
is not made promptly thereafter, such Member may itself notify the
licensing procedure or changes therein, including all relevant and
available information. - SUNS]
Therefore, India argued, "the trigger in the three requirements
are quite different from each other, and the negotiators have used
different terms in different Articles."
Further, the requirement in Article 1.4 (a) is basically a publication
requirement and not a notification requirement while Article 8.2 (b)
is not primarily a notification requirement, India argued.
India said Article 5 is the main notification requirement as it requires
filing "comprehensive information starting with individual products
subject to licensing, administrative bodies to be approached, contact
points for information on eligibility, whether the licensing is automatic
or non-automatic and so on."
"Thus, merging of the two forms is neither desirable, nor supported
by the Agreement," India maintained, pointing out that if members
"club all the information in one single form, a Member will have
to provide all the listed information of Article 5 even when it seeks
to notify say just a simple change in legislation under 8.2 (b)."
In short, merging leads to confusion, India said. "This is something
my delegation will not agree to," it concluded.
The developments in the import licensing committee have not come a
day too soon.
They need to be assessed against the backdrop of sustained pressure
from the US and other major developed countries to ratchet up pressure
on developing countries for notifying measures across all areas such
as the sanitary and phyto-sanitary agreement, technical barriers to
trade, agriculture, and market access for industrial goods - in an
attempt to re-write rules without addressing the specific concerns
raised in the Doha work program, trade envoys argued.
At a meeting on 17 October at the Graduate Institute in Geneva, the
US Trade Representative Michael Froman said "the record of compliance
with the WTO requirements for transparency and disclosure is nothing
short of abysmal, as Members either take far too long to provide the
required information or ignore the obligations altogether."
"We shouldn't underestimate the potential for this situation
to seriously erode the credibility of the system as a whole - including
the negotiating arm ... The United States will be looking to work
with other Members to find solutions to this increasingly urgent problem,"
the USTR said.
Incidentally, the US has not notified its latest farm subsidy payments,
according to a trade envoy from an industrialized country. +
