This is lesson four of an introductory lecture series on WTO law and policy I am giving at Unviersity Pelita Harapan (UPH) Graduate School as part of the Masters in Trade, Investment and Competition Law and Policy (MTIC) Program in January 2014

1. UPH MTIC Program | Introduction
to WTO Law
Market Access in the WTO (Goods)

2. Structure of the Present Lecture
2
1.
2.
3.
4.
5.
6.
7.
8.
The importance of market access
Tariffs
Quantitative restrictions
Tariff-Rate Quotas (TRQs)
Exceptions to the ban on QRs
Administration of QRs
Import licensing
Other non-tariff barriers
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3. The Importance of Market Access
3
 Van den Bossche describes rules on market access as “the core of WTO law”
 The preamble to the WTO Agreement mentions, in paragraph 1, that the Parties
to the Agreement recognize that “their relations in the field of trade and economic
endeavor should be conducted with a view to […] expanding the production of
and trade in goods and services […] “
 In paragraph 3, the preamble speaks of the goal of “the substantial reduction of
tariffs and other barriers to trade […].
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4. The Importance of Market Access
cont’
4
 The WTO is very much a market access organization, and much of what
happens there revolves around market access:
• WTO dispute settlement cases are where countries seek to restore market access
that has been lost;
• Trade negotiations (currently Doha), succeed or fail on the basis of the market
access that WTO Members perceive they will be giving away or getting;
• Accession negotiations can largely be boiled down to bilateral negotiations over
market access expectations between the acceding country- who is required to open
its market- and WTO Members who want to export goods and services to the
applicant’s country market or lock-in/increase existing access.
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5. The Importance of Market Access
cont’
5
Historically, the General Agreement on Tariffs and Trade (GATT), was about a
limited number of issues, all revolving primarily around market access and/or market
access expectations:
 Eliminating quantitative restrictions (GATT Art. XI);
 Establishing a mechanism for locking-in tariffs (the tariff binding, GATT Art. II)) and
then subsequently negotiating reductions to tariff levels (tariff negotiations, GATT Art.
XXVIII bis);
 Establishing binding rules limiting the ability of Contracting Parties to pursue other
policies which would undermine the value of tariff concessions (rules on customs
valuation, GATT Art. VII; fees and formalities connected with import and export,
GATT Art. VIII; subsidies, GATT Art. XVI, state trading enterprises GATT Art. XVII.
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6. The Importance of Market Access
cont’
6
 Dogmatically, barriers to market access are generally broken down into two broad
categories:
– Tariff / Non-tariff barriers
 Otherwise, barriers to market access can be categorized in various ways,
including:
– Border measures / behind the border measures
– De jure / de facto measures
– Trade-distortive / minimally trade-distortive (particularly in the area of subsidies, which
can have an important effect on market access)
– Transparent / non-transparent measures (transparent measures, such as tariffs are
generally published, whereas a non-transparent measure might be an obscure
regulation which is not published or easily obtainable which prescribes certain
conditions for the importation or sale of certain products).
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7. Tariffs
7







The most common and widely-used barrier to market access for goods is customs duties,
also referred to as tariffs.
A customs duty, or tariff, is a financial charge, in the form of a tax, imposed on products at
the time of and/or because of, their importation into the customs territory.
Market access is conditional upon payment of the duty.
Customs duties can either be specific, ad valorem or mixed.
A specific customs duty on a product is an amount based on the weight, volume or quantity
of that product.
An ad valorem customs duty on a good is based on the value of that good, and is expressed
as a percentage of the value of the imported good.
A mixed (or compound) duty is a customs duty comprising an ad valorem duty to which a
specific duty is added (or less commonly subtracted).
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8. Tariffs
cont’
8
 Ad valorem customs duties are by far the most common type of customs duties
and are preferable to specific or mixed duties for several reasons:
– They are more transparent (their impact and price effects are easier to determine)
– They are price indexed
 Ad valorem, specific or mixed duties can be MFN duties, preferential duties, or
neither of the two.
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9. Tariffs
cont’
9
Customs duties or tariffs serve three different purposes:
 Revenue for governments (more important for developing countries).
 Protect domestic industries (tilt the playing field in favour of domestically produced like
or substitutable products.
 Tool for promoting a rational allocation of scarce foreign exchange (encourage spending
on capital goods and discourage spending on consumer or luxury goods and thus as an
instrument for economic development policy).
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10. The National Tariff - Australia
10
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11. Tariffs
cont’
11
Tariff Bindings at the WTO
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12. The National Tariff - USA
12
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13. Tariffs
cont’
13
 The results of tariff negotiations are referred to as “tariff concessions” or “tariff bindings”.
 This is a commitment not to raise the customs duty on a certain product above an
agreed level.
 As a result of the Uruguay Round, virtually all customs duties imposed by developed
country Members are now “bound”.
 The tariff concessions or bindings of a Member are set out in that Member’s Schedule
of Concessions.
 The obligation to refrain from imposing tariffs in excess of the tariff binding does not,
however, stop WTO Members from imposing tariffs that are below this level. Thus many
Members have applied tariff rates that are slightly or even considerably below their
bound rates.
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14. Tariffs
cont’
14
 WTO rules on customs duties relate primarily to the protection of tariff concessions
agreed to in the context of tariff negotiations.
 GATT Article II:1 entitled Schedules of Concessions states:
(a) Each contracting party shall accord to the commerce of the other contracting parties treatment no less favourable than
that provided for in the appropriate Part of the appropriate Schedule annexed to this Agreement.
(b) The products described in Part I of the Schedule relating to any contracting party, which are the products of territories
of other contracting parties, shall, on their importation into the territory to which the Schedule relates, and subject to the
terms, conditions or qualifications set forth in that Schedule, be exempt from ordinary customs duties in excess of
those set forth and provided therein.
 Several other provisions in the GATT are specifically intended to protect the value
of the tariff concessions agreed to, by circumscribing Members abilities to engage
in practices that would undermine the value of those concessions.
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15. Tariffs
cont’
15
 Although WTO Members may not impose customs duties above the tariff
concessions or bindings, the GATT does provide a procedure for the modification
or withdrawal of tariff concessions.
 GATT Article XXVIII:1 states, in pertinent part: “a [Member] … may, by negotiations
and agreement … modify or withdraw a tariff concession included in the
appropriate schedule annexed to this Agreement.
 Negotiations on the modification or withdrawal of tariff concessions are to be
conducted with:
– The Members that hold so-called Initial Negotiating Rights (INRs); and
– Any other Member that has a “principle supplying interest”.
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16. Tariffs
cont’
16

The imposition of customs duties generally require three determinations to be made:
– The determination of the proper classification of the imported good;
– The determination of the customs value of the imported good; and
– The determination of the origin of the imported good.

Specific rules on classification can be found in the International Convention on the
Harmonized Commodity Description and Coding System of the WCO, which entered into
force on 1 January 1988 and to which most WTO Members are a party.
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17. Tariffs
cont’
17
•
•
Because most customs duties are ad valorem, it is first necessary for customs
officials to determine the value of the imported goods in order to be able to
calculate the customs duty due.
The WTO agreements contain rules on customs valuation:
– Article VII of the GATT entitled Valuation for Customs Purposes” (including its Ad Note)
– The WTO Agreement on Implementation of Article VII of the GATT 1994, otherwise
known as the Customs Valuation Agreement.
•
The WTO rules on customs valuation can be quite technical in their application, but
essentially require that the actual value of the imported goods be used as a basis
for assessing duties (transaction value).
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18. Tariffs
cont’
18
•
•
•
•
Customs duties applied to imported goods may differ depending on the country
from which the goods were exported.
This is especially relevant where preferential tariffs are applied for one reason or
another.
Rules to determine the origin of imported goods differ from Member to Member and
many Members use different rules of origin depending on the purpose for which the
origin is determined.
However, generally speaking, the rules of origin currently applied by Members are
based on:
– The principle of value added; or
– The principle of change in tariff classification.
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19. Quantitative Restrictions
19
 The original non-tariff barrier
 In principle, eliminated by GATT Art. XI (numerous exceptions exist)
 Definition:
“Restrictions which limit the value or quantity of goods which can be imported or exported
during a given period”
 Different types of QR:
•A prohibition or ban on a product which may be absolute or conditional, i.e. only applicable
when certain defined conditions are not fulfilled
•A quota, i.e. a measure indicating the quantity that may be imported or exported. A quota can
be a global quota allocated among different countries or a bilateral quota.
•Automatic and non-automatic licensing (most relevant in terms of import licensing); and
•Other QRs such as those made effective through State trading operations, a mixing
regulation, a minimum price triggering a QR and a voluntary export restraint.
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20. Quantitative Restrictions
cont’
20
In his 1949 book “A Charter for World Trade”, Clair Wilcox described the approach
which had been taken in the 1947 negotiations (reflected in the resulting GATT and ITO
Charter) towards QRs, and which explain the reasons behind the hostility the US
originally felt towards them (p.81):
“ The Charter condemns quantitative restrictions; it permits their employment, of necessity,
under specified conditions, but only on sufferance and as an exception to the general rules of
policy
[…]
Quantitative restrictions … impose rigid limits on the volume of trade. They insulate domestic
prices and production against the changing requirements of the world economy. They freeze
trade into established channels. They are likely to be discriminatory in purpose and effect. They
give the guidance of trade to public officials; they cannot be divorced from politics.”
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21. Quantitative Restrictions
cont’
21
 As we have seen, a key objective of the postwar foreign economic policy of the US
was the elimination of QRs.
 In bilateral discussions between the US and Great Britain in 1943 had anticipated
that, in principle, quantitative restrictions would be prohibited. But Britain insisted
that they be permitted for dealing with external payment imbalances for a
transitional period after the war.
 By 1945 it was accepted that exceptions would be needed for three main
purposes:
– To cope with balance of payments difficulties;
– To protect infant industries in poor countries; and
– To accommodate certain agricultural programs.
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22. Quantitative Restrictions
cont’
22
The key provision in the GATT on QRs is Art. XI, entitled General Elimination of
Quantitative Restrictions
“No prohibitions or restrictions other than duties, taxes or other charges, whether
made effective through quotas, import or export licences or other measures, shall be
instituted or maintained by any contracting party on the importation of any product of the
territory of any other contracting party or on the exportation or sale for export of any product
destined for the territory of any other contracting party.”
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23. Quantitative Restrictions
cont’
23
The basic disciplines and the issues that have been clarified in the GATT and WTO
case law on GATT Art. XI include the following:
 Only QRs attributable to governments can be challenged, although the degree of
public intervention necessary to attribute a measure to a government is not
specified;
 The term “measure” has been widely interpreted and a typology of the measures
which qualify as QRs has been established through case law;
 It is not necessary to prove that the intent of the measure is protectionist, nor is it
necessary to demonstrate that the effect of the measure reduces imports (no “aims
and effects” test)
 The relationship between GATT Art. XI and other GATT provisions (particularly Art.
III, XX and XIII) has been clarified in the case law.
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24. Quantitative Restrictions
cont’
24
 In the Japan-Semi-Conductors case, the Panel ruled on the scope of GATT Art. XI:1
saying that the wording “was comprehensive: it applied to all measures instituted or
maintained by a contracting party prohibiting or restricting the importation, exportation
or sale for export of products other than measures that take the form of duties, taxes
or other charges.” (para. 104).
 In India-Autos, India tried to argue that the term “restrictions … on importation” within
the meaning of GATT Art. XI:1 only applies to border measures. The Panel rejected
this argument and noted that the reference to “other measures” in Art. XI:1 suggest a
broad scope as to the kind of measures covered by that provision: “the nature of the
measure as a restriction in relation to importation, which is the key factor to consider
in determining whether a measure may properly fall within the scope of Art. XI:1.”
(para. 7.261).
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25. Quantitative Restrictions
cont’
25
Some examples of measures found to be inconsistent with GATT Art. XI:1
 In US-Shrimp, the Panel found that the United States acted inconsistently with GATT Art.
XI:1 by imposing an import ban on shrimp and shrimp products harvested by vessels of
foreign nationals not certified by the US authorities as using methods not leading to the
accidental killing of sea turtles above certain levels;
 In EEC-Minimum Import Prices, the Panel found that the prohibition on QRs in GATT
Art. XI:1 applied to a system of minimum import prices;
 In Japan – Agricultural Products I, the Panel ruled that the prohibition of GATT Art.
XI:1 applied to import restrictions made effective through an import monopoly, or
more broadly, through State trading operations;
 In India – Quantitative Restrictions, the Panel held that non-automatic import
licensing systems are import restrictions prohibited by Art. XI:1.
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26. Tariff-Rate Quotas (TRQs)
26
 Tariff rate quotas are a hybrid instrument which allow a certain quantity (quota) to be
imported at one (lower) tariff rate, with all other imports (the out-of-quota imports)
entering at another (higher) tariff rate.
 TRQs are used extensively in order to guarantee minimum market access
commitments under the Agreement on Agriculture (agreed in order to counter any
excesses of the tariffication process).
 They are also used sometimes by Members as safeguard measures to remedy injury
caused to a domestic industry by a sudden and unexpected surge in imports.
 As long as the higher (out-of-quota) level does not exceed the WTO Member’s tariff
binding on that good, and the quota is administered in accordance with the relevant
GATT rules (see below), they will not face compliance problems.
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27. Exceptions to the Ban on QRs
27
 As we have seen above, from the very early days of the GATT there was consensus
that exceptions to the ban on QRs would be needed for at least three policy
objectives:
– To cope with balance of payments difficulties;
– To protect infant industries in poor countries; and
– To accommodate certain agricultural programs.
 Paragraph 2 of GATT Art. XI itself circumscribes the otherwise broad scope of the
ban, by stating that the provisions of paragraph 1 shall not extend to:
– Export prohibitions or restrictions temporarily applied to prevent or relieve critical
shortages of foodstuffs or other essential products;
– Import and export prohibitions or restrictions necessary to the application of standards […]
– Import restrictions on any agricultural or fisheries product necessary to the enforcement of
governmental agricultural support programs.
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28. Exceptions to the Ban on QRs
cont’
28
 The most important exception to the ban on QRs (at least today) is undoubtedly
contained in GATT Art. XX entitled General Exceptions. The most important
exceptions here are usually enacted in order to pursue or more of the following
policy objectives:
– Protect human, animal or plant life or health
– Relating to the conservation of exhaustible natural resources
 Another import exception in this regard is GATT Art. XXI entitled Security
Exceptions. Here the most important exceptions will be QRs imposed in order to
allow members to regulate or stop:
– Trade in fissionable materials or the materials from which they are derived;
– Traffic in arms, ammunition and implements of war
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29. Exceptions to the Ban on QRs
cont’
29

The Panel in Turkey – Textiles noted (para. 9.64):
“ From early in the GATT, in sectors such as agriculture, quantitative restrictions were maintained
and even increased … In the sector of textiles and clothing, quantitative restrictions were
maintained under the Multifibre Arrangement … Certain contracting parties were even of the view
that the quantitative restrictions had gradually been tolerated and accepted as negotiable and that
Art. XI could not be, and had never been considered to be, a provision prohibiting such restrictions
irrespective of the circumstances specific to each case”

However the economic effects of these bans, as well as other policies was becoming
increasingly clear to many countries over time:
–The need to integrate the clothing and textiles sector into GATT disciplines was a key concern of
developing countries during the Uruguay Round
–The trade-distorting effects of protectionist policies in the agricultural sectors of many developed
countries had, by the 1980s, become well documented and disciplining these policies in order to
mitigate their trade distorting effects was a key objective of many countries in the Uruguay Round.
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30. Exceptions to the Ban on QRs
cont’
30
 The Results of the Uruguay Round contain various examples of the successes
achieved in strengthening the disciplines on QRs and eliminating the exceptions to
Art. XI:1 was a key objective and outcome of the Uruguay Round, which was
manifested, inter alia in:
–
The tarrification process of the Agreement on Agriculture (Art. 3 and footnote 1 of the
Agreement)
– The ban on imposing new restrictions on imports of textiles and clothing contained in
Art.2.4 of the ATC and the phase out of all existing restrictions together with the
Agreement pursuant to Art. 9 ATC,
– The ban on VERs and other grey area measures in Art. 11 of the Safeguards Agreement.
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31. Exceptions to the Ban on QRs
cont’
31


Even with the success the multilateral trading system has had on policing QRs, many such
measures typically remain today.
Below an exert from the USTR Trade Barrier Report (2009) for Indonesia:
Quantitative Restrictions
The Indonesian government requires an import permit from the Directorate General of Livestock Services for
imports of animal-based food products. In approving requests for such permits, the Indonesian government
arbitrarily may alter the quantity it allows to enter. U.S. industry estimates the annual trade impact of this restriction
to be between $10 million and $25 million.
Indonesia bans salt imports during the harvest season. It requires salt importers to be registered and to source
products locally. Indonesia applies quantitative import limits to imported wines and distilled spirits. Only one
registered importer, a state-owned enterprise, is authorized to import alcoholic beverages, with an annual quota
set by the Ministries of Trade and Industry.
As a result of new mining legislation, mining firms operating in Indonesia will face new restrictions in exporting
unprocessed ore. The legislation will require them to process the ore in Indonesia before shipping it abroad. The
United States will closely monitor implementation of the law to ensure that it does not constitute an export ban on
raw materials.
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32. Exceptions to the Ban on QRs
cont’
32
The Japanese Ministry of International Industry and Trade also monitors trade barriers in its
most important trading partners. Below an excerpt from its 2009 report concerning QRs in
Canada:
QUANTITATIVE RESTRICTIONS
Export Restrictions on Logs
<Outline of the measure>
The Province of British Columbia has prohibited the export of a portion of softwood logs in order to protect its
domestic industry. Specifically, provincial law requires that lumber produced from provincial forests be either used or
processed within the Province. Raw materials that are not used within the province are exported as superfluous
materials only in the event that permission is given by the Lieutenant Governor or Minister of Forestry. However, the
export of a portion of high-quality coniferous raw materials, including all Norway spruce and yellow cedar as well as
spruce-fir, is prohibited except from certain areas such as native settlements.
<Problems under international rules>
Since the measure may protect the Province’s domestic industry under the pretext of Forestry Resource Protection, it
is highly likely to be in violation of GATT Article XI. Although the measure is that of a local government, pursuant to
Paragraph 12 of GATT Article XXIV, Canada is fully responsible for the observance of all GATT provisions by British
Columbia.
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33. Administration of QRs
33
 In light of the numerous exceptions to the ban on QRs, GATT contracting parties
set out from the very outset of the multilateral trading system, to ensure that any
remaining QRs would be administered subject to certain disciplines.
 GATT Art. XIII contains a number of such disciplines, the most import of which
are:
– The rule of non-discrimination;
– Rules on the distribution of trade; and
– Rules on import licensing procedures
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34. Administration of QRs
cont’
34
 GATT Art. XIII:1 provides that, QRs, when applied, should be administered in a
non-discriminatory manner.
 What GATT Art. XIII:1 requires is that is a Member imposes QRs on products to or
from another Member, products to or from all other countries are “similarly
prohibited or restricted”.
 This requirement is an MFN-like obligation, the idea being that like products should
be treated equally, irrespective of their origin.
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35. Administration of QRs
cont’
35






The GATT Panel in EEC –Apples I (Chile) found that the EC had acted inconsistently with the
non-discrimination obligations of GATT XIII:1.
Apples from Argentina, Australia, NZ and SA had been restricted through VERs.
The EC tried to reach an agreement with Chile on a similar VER with Chile but the negotiations
failed.
The EC then adopted measures restricting imports of Chilean apples to aprox. 42’000 tones.
The Panel in this case found that the measures applied to Chilean imports by the EC were not
a restriction similar to the VERs negotiated with other countries and was thus a violation of
GATT XIII:1.
The Panel largely came to this finding on the basis that:
– There was a difference in transparency between the two types of action;
– There was a difference in the administration of the restrictions, the one being an import
restriction, the others being export restraints;
– The import restrictions were unilateral and mandatory while the other actions were “voluntary”
and had been negotiated.
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36. Administration of QRs
cont’
36


If QRs, other than a prohibition or ban, are applied on the importation of a product, the
question arises how the trade that is still allowed is to be allocated.
In this respect, the chapeau of GATT XIII:2 provides
In applying import restrictions to any product, [Members] shall aim at a distribution of trade in such
product approaching as closely as possible the shares which the various [Members] might be
expected to obtain in the absence of such restrictions.

Moreover, GATT XIII:2 sets out a number of requirements to be met when imposing QRs.
Art. XIII2(a) states:
Wherever practicable, the quotas representing the total amount of permitted imports (whether
allocated among supplying countries or not) shall be fixed, and notice given of their amount in
accordance with paragraph 3(b) of this Article.

In cases where a quota is allocated among supplying countries, GATT XIII:2 (d) provides:
The [Member] applying the restrictions may seek agreement with respect to the allocation of
shares in the quota with all other [Members] having a substantial interest in supplying the product
concerned
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37. Administration of QRs
cont’
37
 However, where this method of allocating the shares in the quota “is not reasonably
practicable”, i.e. when no agreement can be reached with all the Members having a
substantial interest, the Member applying the quota must be allocated on the basis of
Members’ shares of trade during a previous representative period (normally 3 years).
 Quotas allocated among supplying countries must be allocated among all Members
having a substantial interest in supplying the product.
 There is no obligation to allocate a part of the quota to Members without a substantial
interest in supplying the product concerned.
 This provision can be considered as lex specialis to the general requirements of
MFN, since it allows for discrimination between Members with and Members without
a substantial interest in supplying the product at issue.
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38. Import Licensing
38
 Quotas (and TRQs-more on this later) are usually administered by means of importlicensing procedures.
 Art. 1.1 of the Import Licensing Agreement defines import-licensing procedures as:
administrative procedures … requiring the submission of an application or other
documentation (other than that required for customs purposes) to the relevant
administrative body as a prior condition for the importation into the customs territory of the
importing Member
 Article 1 of the Import Licensing Agreement sets out rules on the application and
administration of import-licensing rules, the most important of which (Art 1.3), reads:
The rules for import licensing procedures shall be neutral in application and
administered in a fair and equitable manner.
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39. Import Licensing
cont’
39
 The Import Licensing Agreement distinguishes between two kinds of licensing:
‒ Automatic
‒ Non-automatic
 The two underlying and dominant principles of the Import Licensing Agreement are
‒ Neutrality, fairness and equity (non-trade-distorting)
‒ Transparency (publication and notification)
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40. Import Licensing
cont’
40
 Automatic import licensing is defined as import licensing where approval of the
application is granted in all cases (provided all the required documentation is
provided).
 Automatic import licensing is used by governments for various purposes,
including to collect statistical and other information on imports.
 Art. 2.2 of the Import Licensing Agreement requires that automatic importlicensing procedures shall not be administered in such a manner as to have
“restrictive effects on imports subject to automatic licensing”.
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41. Import Licensing
cont’
41



Non-automatic import licensing is import licensing where approval is not granted in all
cases.
Import licensing procedures for quotas and TRQs are by definition non-automatic import
licensing procedures.
Article 3.2 of the Import Licensing Agreement requires that:
Non-automatic licensing shall not have trade-restrictive or distortive effects on imports
additional to those caused by the imposition of the restriction

Other requirements relating to non-automatic import licensing concern:
–
–
–
–
–
–
Non-discrimination among applicants for import licenses;
The obligation to give reasons for refusing an application;
The right of appeal or review of the decision on applications;
Time-limits for processing applications
The validity of import licenses; and
The desirability of issuing licenses for products in economic quantities
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42. Other non-tariff barriers
42
 As the term indicates, this is a residual category of measures and actions that
restrict, to various degrees and in different ways, market access for goods and
which are not administered in the form or a tariff.
 This category covers numerous rather different measures and actions, such as:
–
–
–
–
–
–
–
Technical barriers to trade
Sanitary and phytosanitary measures
Customs formalities and procedures
Government procurement practices
State trading agencies
Lack of transparency
Other measures or actions, such as preshipment inspection et al.
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43. Why do we have an agreement on
technical barriers to trade?
43



Standards, as an issue, is a relatively late edition to multilateral disciplines;
The General Agreement (GATT), drafted in 1947, makes no specific reference to them;
The impetus to negotiate rules on standards in the late 60s and early 70s, came from three
directions:
–
–
–
General recognition of the fact that, of the 900 notifications in the GATT nontariff measure (NTM)
inventory, about 150 of them involved or were linked to the application of standards.
US interest in the negotiation of GATT rules for standards quickened by the action of Britain, France and
Germany in concluding a tri-partite agreement (CENEL) for the harmonization and certification of
electronic components
European view that the US was considerably less willing to adopt international standards than the
Europeans themselves. The EC Commission was keenly interested in having the US accept the
standards it was formulating, as this would increase its authority vis-à-vis EC Member States.
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44. Uruguay Round and TBT
44


The Punta del Este declaration which launched the Uruguay Round in September 1986 did not
contain specific language on negotiating a new standards code (unlike other areas such as
agriculture, services, intellectual property).
In the context of standards, the Punta del Este declaration limited itself to a statement, under a
heading entitled “MTN Agreements and Arrangements”, saying:
“Negotiations shall aim to improve clarify, or expand, as appropriate, Agreements and Arrangements
negotiated in the Tokyo Round of Multilateral Negotiations”


Generally there was a feeling that the Tokyo Round Standards Code had worked well, and that it
only needed slight improvement in a limited number of areas.
Negotiating texts in the UR focused mainly on widening its scope and making its rules more
effective.
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45. Substantive Scope of the
WTO TBT Agreement
45
 The rules of the TBT Agreement apply to a “limited class of
measures”:
– Technical regulations
– Standards; and
– Conformity assessment procedures
 These three types of measure are defined in Annex 1 to the TBT
Agreement.
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46. Definitions of Technical
Barriers to Trade
46

Annex 1.1. defines a technical regulation as a
“[d]ocument which lays down product characteristics or their related processes and production methods,
including the applicable administrative provisions, with which compliance is mandatory. It may also include or
deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a
product, process or production method.”

Annex 1.2. defines a standard as a
“[d]ocument approved by a recognized body, that provides, for common and repeated use, rules, guidelines or
characteristics for products or related processes and production methods, with which compliance is not
mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling
requirements as they apply to a product, process or production method.

Annex 1.3 defines a conformity assessment procedure as:
“Any procedure used, directly or indirectly, to determine that relevant requirements in technical regulations or
standards are fulfilled.”
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47. The Agreement on Sanitary and
Phytosanitary Measures
47
Two-Fold Objective of the SPS Agreement
To recognize the sovereign right of WTO Members to provide the level of health
protection they deem appropriate; and
To ensure that SPS measures do not represent unnecessary, arbitrary, scientifically
unjustifiable, or disguised restrictions on international trade.
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48. Scope of the SPS Agreement
48
Article 1.1 of the SPS Agreement defines the scope of application of the
Agreement and provides that:
“This Agreement applies to all sanitary and phytosanitary measures which
may, directly or indirectly, affect international trade. Such measures shall be
developed and applied in accordance with the provisions of this Agreement.”
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49. What is an SPS measure?
49
To fall under the SPS Agreement’s scope and coverage, a measure
must:
 Be a sanitary or phytosanitary measure; and
 Directly or indirectly affect international trade.
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50. What is an SPS Measure? – cont.
50
A sanitary or phytosanitary measure or “SPS measure” is defined in para. 1 of Annex A to
the SPS Agreement as any measure applied:
(a)
to protect animal or plant life or health within the territory of the Member from
risks arising from the entry, establishment or spread of pests, diseases, disease-carrying
organisms or disease-causing organisms;
(b)
to protect human or animal life or health within the territory of the Member from
risks arising from additives, contaminants, toxins or disease-causing organisms in foods,
beverages or feedstuffs;
(c)
to protect human life or health within the territory of the Member from risks
arising from diseases carried by animals, plants or products thereof, or from the entry,
establishment or spread of pests; or
(d)
to prevent or limit other damage within the territory of the Member from the
entry, establishment or spread of pests.
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51. What is an SPS Measure? – cont.
51
Paragraph 1 of Annex A of the SPS Agreement provides a non-exhaustive list of
SPS measures. Among them:
•End product criteria;
•Processes and production methods;
•Testing, inspection, certification and approval procedures;
•Quarantine treatments including those associated with the international transport of
animals or plants (or those concerning the materials necessary for their survival
during transport);
•Provisions on relevant statistical methods;
•Sampling procedures and methods of risk assessment and packaging and labeling
requirements that are directly related to food safety.
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52. Relationship between the SPS
and the TBT Agreements
52
•
As set out in Art. 1.5 of the TBT Agreement, the TBT Agreement does not
apply to SPS measures.
•
When a measure is an SPS measure as defined in Annex A(1) to the SPS
Agreement, the SPS Agreement applies to the exclusion of the TBT
Agreement, even if the measure would otherwise be considered a “technical
regulation, standard or conformity assessment procedure” for purposes of the
TBT Agreement.
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53. Examples of TBT and SPS Measures
53
TBT measures typically deal with:
SPS measures typically deal with:
Labeling of composition or quality of
food, drink and drugs;

Additives in food or drink;

Contaminants in food or drink;

Certification: food safety, animal or plant
health;

Processing methods with implications for
food safety;

Other sanitary requirements for imports;

Labeling requirements directly related to
food safety and others.
Quality requirements for fresh food;
Volume, shape and appearance of
packaging;
 Testing vehicles and accessories;
Regulations for ships and ship
equipment;
 Safety regulations for toys.
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54. Summary
54





Governments have proven very ingenious in finding ways to manage trade,
particularly imports, and subject them to various restrictions, designed to pursue
various policy objectives.
Nevertheless, market access remains a key driver of much of the WTO’s activities and
is at the very heart of what the Organization is about.
Tariffs are the most important market access barrier, but quantitative restrictions,
although subject to a general ban in theory, are also an important market access
barrier.
Today, traders are faced with a complex array of varying obstacles and procedures
that need to be overcome or complied with before they can import (or export) their
products.
Trade is more highly regulated than ever, and is still anything but “free”.
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55. Thank You
UPH MTIC Program | Introduction
to WTO Law
Market Access in the WTO
Simon Lacey