World Trade
Organization TN/MA/W/110
16 April 2009 (09-1826) Negotiating Group on Market Access Original: English

MARKET ACCESS FOR NON-AGRICULTURAL PRODUCTS

Answers by the co-sponsors to Questions raised during Chair's NTB session of 19.
2009 regarding the proposed "Ministerial Decision on procedures
for the facilitation of solutions to non-tariff barriers"

Communication from the co-sponsors

The following communication, dated 8 April 2009,
is being circulated at the request of the cosponsors of the proposed "Ministerial Decision on procedures for the facilitation of solutions to non-tariff barriers".
Purpose of the Horizontal Mechanism
The proponents of the "procedures for the facilitation of solutions to non-tariff barriers" ("Horizontal Mechanism") are conscious of the fact that non-tariff measures vary significantly in form, effects and objectives, and that non-tariff measures can serve legitimate and important purposes pursued by Members.
(Korea)

The Horizontal Mechanism (HM) has been proposed as an assisted NTB resolution procedure to be used within the framework of WTO Committees to (i) gain clarity and information about any measure or issue that one or more Members consider to be a non-tariff barrier (NTB); and (ii) to have a facilitated discussion on the issue with the aim of resolving or lessening the adverse trade impact that it may have on other Members’ trade.
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In case of little political will to address any issue, the possibility of its resolution may be dim, as can also be the case in formal dispute settlement.
For this very reason the proponents, a majority of which are developing and least developed countries, prefer to strengthen the systems in the WTO and seek solutions in the WTO where they have invested significant resources rather than just concentrate on bilateral solutions.

The proposal provides that all information acquired pursuant to Stage II of the Horizontal Resolution Mechanism (“HRM”) shall be “confidential” and “without prejudice to the rights of any party or other WTO Member in any dispute settlement proceeding under the DSU”.
It has two functions: the first is to gain clarity on the issue and the other is for the parties to explore whether they will go ahead into Stage II for assisted problem resolution.
Notwithstanding such discussions on the sidelines, it is correct to understand that that advice or proposals of the facilitator will not include any kinds of interpretation of the Articles of the WTO Agreements.

Coverage of the Horizontal Mechanism
The Horizontal Mechanism covers all NTBs affecting trade in goods and falling under the remit of the Council for Trade in Goods except for measures regulated by the Agreement on Agriculture, countervailing measures, antidumping measures, and safeguard measures (Annex 1).
However, given that the WTO Committees are structured on the basis of trade disciplines, rather than product-nature, and even more importantly in view of the nature of the underlying measures in question, such a division does not make sense.
export taxes and export restrictions, classification issues, private standards, import licenses linked to local production, minimum import prices, customs valuation issues, preferential rules of origin, nuclear materials restrictions, port security measures, level of mercury in fish, different customs treatment of the same product by Customs Union members, administrative delays (U.
Paragraph 9 envisages a situation which involves one requesting Member and one responding Member; whereas paragraph 6 provides for the possibility of more than one requesting Member in the case of a joint request.
If there are two requesting Members, then the procedure can operate jointly if the parties can agree on a joint approach – if they cannot, the procedure will have to be split up and proceed (or not proceed) separately,
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It appears that under the current terms, the responding member has a leeway to provide non-substantial and vague statements as a response such as, for example, “the measure at issue and its actual trade impact are different from the information presented by the requesting party.
It is however very important to provide for a fallback procedure in cases where the parties are not able to agree on a facilitator, so that the procedure does not become deadlocked for this reason alone.
Regarding third party participation is the date of notification under paragraph 10 or the date of circulation of the notification to the members to be considered as the startingpoint for the 10 day time-limit?

In the event that a Member is refused (by the requesting Member, responding Member, or both) third party participation, will that Member be required to initiate Stage I or could that Member initiate Stage II based on the information provided by the responding Member to the requesting Member under Stage I?
Given that the opinion of the facilitator “any such opinion shall not pertain to the WTO consistency of the NTB, the parties' rights and obligations under the WTO Agreement, or to any possible legitimate objectives for the maintenance of the measure,
A possible circumstance on which a non-Chair facilitator would be requested by the parties would be if one of the parties or both express doubt on the technical competence of the Chairperson or Vice Chairperson to assist the parties to find a solution to their concern; non-availability of the Chair/Vice Chair due to other engagements; the possibility that the Chair/Vice Chairs are citizens of the parties concerned; reluctance of the Chair/Vice Chairs due to personal reasons, etc.

Also, should the criteria for non-Chair facilitators not be adopted by the General Council, based on recommendations of the Committee on Budget, Finance and Administration (see WT/L/76 – Procedure for decisions having financial implications which may be taken by WTO bodies)?
If the facilitator has to provide such a report, wouldn’t there be a risk that she or he could prejudge or give some clues of the reasons for the lack of a mutually agreed solution (especially considering that the facilitator is not bound by the comments of the parties to the draft factual report)?
The submission of the final factual report does also allow the Committee to build up an overall appreciation of issues existing under its remits, both those resolved and those not resolved.
Can the Horizontal Mechanism proponents lead Members through the facilitation procedures in a hypothetical Horizontal Mechanism request – for example, what if an issue was raised that had been in front of Committees extensively in the past.

A Facilitator can take into account the information sought/ exchanged already and help the concerned Members focus on the solution, if there is one, within the time frame that is offered here in terms of paragraph 15 (a).
21)

The US proposal on “Committee First” highlights a series of objectives and benefits such
as Institutional Expertise, Multilateral Discussion, Timing and Cross-Cutting Discussions
among others.
The proponents have addressed however in these responses herewith provided specific questions relating to the institutional expertise regarding the facilitator and WTO Secretariat, participation of third parties in the procedure, timing, and notification at the various stages as well as information to the relevant Committees at the end of the problem solving procedure.