Let ’s Talk about Trade Policy and Trade Issues
MD, who else?
I Preliminary Knowledge
1Tariff
(1)Specific Tariff （从量关税）
Weight, quantity, volume
(2)Ad Valorem Tariff （从价关税）
A percentage of the price
(3)Compound Tariff （复合关税）
A mixture of specific tariff and ad valorem tariff
2Non-tariff
(1)Quota
(2)License（进口许可证）
General license and specific license; usually combined with quota, bidding
(3)Custom Valuation
(4)Technical Barriers
(5)Environment issues
(6) GMO （ Genetically Modified Organism，转基因生物）
3 VER & VIE
(1)VER(Voluntary Export Restriction)
(2)VIE(Voluntary Import Expansion)
Aiming at trade balance, either domestic or foreign.
II GATT & Agreements
1 Historical Perspective of WTO
(1)Havana Charter ( →GATT 1947)
a)Background: protectionism after WW II, Great Depression, need
to establish ITO (International Trade Organization);
b)The charter is mainly about trade and commercial policies, employment,
economic activities, economic reconstruction, investment, restrictive
business practice;
c) Failed to meet some countries ’butinterest,much content of Commercial
policy survived in GATT 1947, provisional rather than legal;
(2)Marrakesh Agreements (establishing WTO)
a)The importance of Uruguay Round on Marrakesh Agreements and
the establishment of WTO;
b)Including Agreements about [trade in commodity, GATS, TRIPs],
DSU(Understanding on Rules and Procedures Governing the
Settlement of Disputes), TPRM, PTA(Plurilateral Trade Agreements);
c)Entered into force on 1 Jan. 1995, 128 GATT signatories;
d)160 members since 26 Jun. 2014
2 GATT 1947
(1)Basic Principles of WTO
a)Nondiscrimination(MFN, NT), Graduation Clause
b)Trade Liberalization(tariff, non-tariff, market access)
c)Transparence
d)Fair Competition
(2)MFN clause---Article I
a)Most-Favored-Nation Treatment(MFN): any advantage, favor, privilege
or immunity granted by any contracting party to any product shall be
accorded immediately and unconditionally to the like product of all
other contracting parties;
b)Accord the basic principles, nondiscrimination, promote trade
liberalization as it’ s Multilateral;
c)Exceptions: GSP, FTA, Anti-dumping. safety issues, etc.
d)China ’ s benefits: double-edged sword;
(3)National Treatment---Article III
a)National Treatment on Internal Taxation and Regulation: the
contracting parties should treat imported products and domestic
products equally in terms of internal taxes and/or other internal charges,
laws, regulations, and requirements;
b)Exceptions: government procurement, domestic subsidies, etc.
c)Preference Policy and NT: depending on different industries;
(4)Anti-dumping---Article VI
a)Dumping: products of one country are exported to another country at
a price less than the normal value, and is causes or threatens material
injury to the importer’ s industry;
b)“ normal value” is defined by the comparable price, in the ordinary
course of trade, for the like product for consumption in the exporting
country; or if domestic price not available: the highest comparable price
for the like product exported to a third country, or the cost of the
product plus a reasonable additional for selling and profit;
c)Determinants in dumping: Dumping Margin and Material Injury
(5)Rule of Origin(RoO)---Article IX
a)Marks of Origin: marks, characters, patterns, etc. that indicate
the original country/region of an imported product or service;
b)Article 7: contracting parties cooperate to minimize the difficulties,
and to prevent misrepresent of the true origin;
c) Determining origin and whether“ substantial transformation” :
value-added, process test, change in tariff classification(CTC);
d)Controversial issue on trade balance: different standards to
determine origin and processing trade;
e)MFN or not determined by the origin of the product;
(6)Administration of Trade Regulations---Article X
a)Publication: laws, regulations, judicial decisions and administrative
rulings of general application about international trade (e.g. custom
classification and valuation, rates of duty/taxes, requirements,
restrictions, etc.) shall be published promptly to enable traders
become acquainted with them;
b)Administration: contracting parties shall maintain, or institute judicial,
arbitral, or administrative procedures to deal with custom matters,
and administrate laws, regulations in a uniform and reasonable way;
(7)QRs(Quantitative Restrictions)---Article XI
a)Elimination of QRs: except duties, taxes or other charges, contracting
parties shall eliminate restrictions made effect through quotas,
licenses or other measures.
b)Exceptions: food, agriculture or fisheries product. (shortage or surplus)
(8)General Exceptions---Article XX
a)Protect public morals;
b)Protect human, animal or plant life or health;
c)Trade relating to gold or silver;
d)Secure compliance with laws or regulations consistent with
the provisions (e.g. intellectual property);
e)Prison labor products;
f)National treasures;
g)Exhaustible resources;
h)Intergovernmental commodity agreement that are approved;
i)Ensure essential domestic quantities;
j)General or local short supply;
(9)State Trading Enterprise---Article XVII
a)Contracting parties can establish or maintain state enterprises, but they
shall act in a manner consistent with general principles of non-
discriminatory treatment for governmental measures affecting trades by
private traders;
b)Such enterprises shall make purchases or sales solely in accordance
with commercial considerations, including price, quality, availability,
transportation, etc.
c)Contracting parties shall not prevent enterprises from acting
in accordance with the principles;
(10)Subsidies---Article XVI
a)Subsidies in General: when granting any subsidies, contracting parties
shall notify other parties in writing of the extent, nature, estimated
effect and necessity;
b)In case of serious prejudice, the contracting party granting the
subsidy shall discuss with other parties about the possibility of limiting
the subsidization;
c)Additional Provisions: parties shall seek to avoid the use of subsidies
on the export of primary products, or the subsidy shall not increase the
party ’ s equitable share of the world export in that product;
(11)Implemental Mechanism---Article XXIV
a)Territorial Application-Frontier Traffic-Customs Unions-Free
Trade Areas, an exception of MFN
(12)GSP(Generalized System of Preference)
a)Between developed countries and developing countries;
b)Nondiscrimination, unilateral;
(13)History: China’ s reenter in GATT
a)An original contracting party;
b)Suspended its eligibility as a contracting party in 1950;
c)Taiwan: observer to GATT in 1965;
d)China ’ s efforts to reenter in 1986;
e) Complexity of China’ s relevance to ;GATT
3 GATT 1994
(1)The framework of UR
a)Agreements about [trade in commodity, GATS, TRIPs],
b)DSU(Understanding on Rules and Procedures Governing the
Settlement of Disputes),
c)TPRMs
d)PTA (Plurilateral Trade Agreements);
(2)The initiatives of WTO
a)Principles?
(3)Legal instruments under GATT 1947
a)Tariff concession;
b)Protocols of accession;
c)Waiver granted under Article 25
(4)Understanding on Paragraph1(2) Article II
a)Aims at promoting the transparency of the rights and obligations;
b) Agreement to record in national schedules“ other duties or
charges (which” shall be exempted) levied in addition to the recorded
tariff, and to bind them at the levels prevailing at the date established in
the UR Protocol;
(5) Understanding on Article XVII
a) To promote the transparency of statetrading- enterprises’ activities,
contracting parties shall report such enterprises to the committee,
regardless of whether export has happened or not;
b) Increase surveillance ofenterprises’ activities through stronger
notification and review procedures;
(6)Understanding on Article XVIII
a)Article 18: for the Balance-of-Payment(BOP) and development of
economy, especially for the less developed countries, tariff protection
and QRs can be imposed;
b)The schedule for the restriction measures on import shall be notified
as soon as possible;
c)Contracting parties imposing restrictions for BOP purposes shall do so
in the least trade-disruptive manner, and shall favor price-based
measures, like import surcharges and import deposits, rather than
quantitative restrictions.
d)Agreement is also on procedure for consultations by GATT
BOP Committee, as well as for notification.
(7)Understanding on Article XXIV
a)Clarify and reinforce the standard and procedures for the review of new
or enlarged custom unions or FTA and for the evaluation of their
effects on third parties;
b)Clarify the procedure to be followed for achieving any necessary
compensatory adjustment in the event of contracting parties forming
a customs union seeking to increase a bound tariff;
c)The obligations of contracting parties in regard to measures taken
by regional or local governments or authorities within territories are
also clarified;
4 Other Agreements
(1)Agreement on Technical Barriers to Trade （ TBT ，技术性贸易壁垒协议）
a)Narrow TBT: processing and production methods related to
the characteristics of the product itself;
b)Dilemma on Broad TBT: needs for industrialization vs.
potentiality toward protection;
c)This agreement will extend and clarify the Agreement on Technical Barriers
to Trade reached in the Tokyo Round. It seeks to ensure that technical
negotiations and standards, as well as testing and certification procedures, do
not create unnecessary obstacles to trade. However, it recognizes that countries have the right to establish protection, at levels they consider appropriate, for
example for human, animal or plant life or health or the environment, and should not be prevented from taking measures necessary to
ensure those levels of protection are met. The agreement therefore
encourages countries to use international standards where these are
appropriate, but it does not require them to change their levels of protection as
a result of standardization.
Innovative features of the revised agreement are that it covers processing and production methods related to the characteristics of the product itself. The
coverage of conformity assessment procedures is enlarged and the disciplines
made more precise. Notification provisions applying to local government and
non-governmental bodies are elaborated in more detail than in the Tokyo
Round agreement. A Code of Good Practice for the Preparation, Adoption and
Application of Standards by standardizing bodies, which is
open to acceptance by private sector bodies as well as the public sector,
is included as an annex to the agreement.
(2)Agreement on the Application of Sanitary and Phytosanitary Measures
（SPS，实施动植物卫生检疫措施协议）
a)Specific in the protection of human health and ecological balance,
(3)Agreement on Trade-Related Investment Measures （TRIMs ，与贸易有
关的投资措施协议）
a)This Agreement, negotiated during the Uruguay Round, applies only to
measures that affect trade in goods. Recognizing that certain investment
measures can have trade-restrictive and distorting effects, it states that
no Member shall apply a measure that is prohibited by the provisions of
GATT Article III (national treatment) or Article XI (quantitative restrictions).
Examples of inconsistent measures, as spelled out in the Annex‘ s
Illustrative List, include local content or trade balancing requirements. The
Agreement contains transitional arrangements allowing Members to
maintain notified TRIMs for a limited time following the entry into force of
the WTO 。The Agreement also establishes a Committee on TRIMs to
monitor the operation and implementation of these commitments.
(4)Agreement on Agriculture （农业协议）
a)Long-term objectives: substantial progressive reduction in
agricultural support;
b) A decisive move towards the objective of increased market orientation
in agricultural trade;
c)Total AMS(Aggregate Measure of Support): covers all support
provided on either a product-specific or non-product-specific basis;
d)Market access---tariffication: non-tariff border measures are replaced
by tariffs that provide substantially same level of protection; Tariff-quota:
under 10% & outside 80%;
e)Domestic support---amber, blue, green box.
f)Amber box: All domestic support measures considered to distort
production and trade (with some exceptions) fall into the amber box,
which is defined in Article 6 of the Agriculture Agreement as all
domestic supports except those in the blue and green boxes. These
include measures to support prices, or subsidies directly related to
production quantities. These supports are subject to limits: “ de minimis ”
minimal supports are allowed (5% of agricultural production
for developed countries, 10% for developing countries); the 30 WTO
members that had larger subsidies than the de minimis levels at the
beginning of the post-Uruguay Round reform period are committed
to reduce these subsidies.
g)Blue Box: This is the “ amber box with conditionsconditions” —
designed to reduce distortion. Any support that would normally be in the
amber box, is placed in the blue box if the support also requires farmers
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to limit production (details set out in Paragraph 5 of Article 6 of the
Agriculture Agreement). At present there are no limits on spending on
blue box subsidies. In the current negotiations, some countries want to
keep the blue box as it is because they see it as a crucial means of
moving away from distorting amber box subsidies without causing too
much hardship. Others wanted to set limits or reduction commitments,
some advocating moving these supports into the amber box.
h)Green Box: In order to qualify, green box subsidies must not distort trade,
or at most cause minimal distortion (paragraph 1). They have to be
government-funded (not by charging consumers higher prices) and must
not involve price support. They tend to be programmes that are not
targeted at particular products, and include direct income supports for
farmers that are not related to (are “ decoupled ” from) current production levels or prices. They also include environmental protection and regional
development programmes. “ Green box ” subsidies are therefore allowed
without limits, provided they comply with the policy-specific criteria set
out in Annex 2. In the current negotiations, some countries argue
that some of the subsidies listed in Annex 2 might not meet the criteria
of the annex ’ s first paragraphbecause—of the large amounts paid, or
because of the nature of these subsidies, the trade distortion they cause
might be more than minimal. Among the subsidies under discussion here
are: direct payments to producers (paragraph 5), including decoupled
income support (paragraph 6), and government financial support for
income insurance and income safety-net programmes (paragraph 7), and
other paragraphs. Some other countries take the opposite view— that
the current criteria are adequate, and might even need to be made
more flexible to take better account of non-trade concerns such as
environmental protection and animal welfare.
i)Export competition: Members are required to reduce the value of
mainly direct export subsidies to a level 36 per cent below the 1986-90
base period level over the six-year implementation period, and the
quantity of subsidized exports by 21 per cent over the same period.
(5)Agreement on Textiles and Clothing （纺织品与服装协议）
a)MFA(Multifibre Arrangement): Up to the end of the Uruguay Round, textile
and clothing quotas were negotiated bilaterally and governed by the rules
of the Multifibre Arrangement (MFA). This provided for the application of
selective quantitative restrictions when surges in imports of particular
products caused, or threatened to cause, serious damage to the industry
of the importing country. The Multifibre Arrangement was a major
departure from the basic GATT rules and particularly the principle of non-
discrimination. On 1 January 1995 it was replaced by the WTO Agreement
on Textiles and Clothing which sets out a transitional process
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for the ultimate removal of these quotas.
b)ATC(Agreement on Textiles and Clothing) is a transitional
instrument built on the following key elements:
(a)the product coverage, basically encompassing yarns, fabrics,
made-up textile products and clothing;
(b)a programme for the progressive integration of these textile and
clothing products into GATT 1994 rules;
(c)a liberalization process to progressively enlarge existing
quotas (until they are removed) by increasing annual growth rates
at each stage;
(d)a special safeguard mechanism to deal with new cases of
serious damage or threat thereof to domestic producers during the
transition period;
(e)establishment of a Textiles Monitoring Body ( “ TMB” )to
supervise the implementation of the Agreement and ensure that
the rules are faithfully followed; and
(f)other provisions, including rules on circumvention of the quotas,
their administration, treatment of non-MFA restrictions, and
commitments undertaken elsewhere under the WTO's agreements
and procedures affecting this sector.
c)Secure the eventual integration of the textiles and clothing
sector(MFA)into the GATT on the basis of strengthened GATT rules
and disciplines
(6)General Agreement on Trade in Service （GATS，服务贸易总协定）
a)For the purposes of this Agreement, trade in services is defined as
the supply of a service:
(a)from the territory of one Member into the territory of any other
Member;
(b)in the territory of one Member to the service consumer of any
other Member;
(c)by a service supplier of one Member, through commercial presence
in the territory of any other Member;
(d)by a service supplier of one Member, through presence of natural
persons of a Member in the territory of any other Member.
b)The scope of trade in service:
services supplied from the territory of one party to the territory of another (e.g. international telephone calls), officially known as cross“-
border supply”
services supplied in the territory of one party to the consumers of any other (for example, tourism); ), officially consumption abroad“”
services provided through the presenceof service providing entities of one party in the territory of any other (for example, banking) (e.g. foreign banks setting up operations in a country), officially commercial presence“”
individuals travelling from their own country to supply services in
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another (e.g. fashion models or consultants), fficiallyo presence“ of
natural persons”
(7)Agreement on Trade-Related Aspects of Intellectual Property Rights
（TRIPs ，与贸易有关的知识产权协议）
1.Copyright and Related Rights
2.Trademarks
3.Geographical Indications
4.Industrial Designs
5. Patents
https://www.doczj.com/doc/a45630459.html,yout-Designs (Topographies) of Integrated Circuits
7.Protection of Undisclosed Information
8.Control of Anti-Competitive Practices in Contractual Licenses
(8)Trade Policy Review Machanism （TPRM ，贸易政策审议机制）
a)An agreement confirms the Trade Policy Review Mechanism, introduced
at the time of the Mid-term Review, and encourages greater
transparency in national trade policy-making. A further Ministerial
decision reforms the notification requirements and procedures generally.
b)The objectives of the TPRM, as expressed inAnnex 3 of the Marrakesh
Agreement, include facilitating the smooth functioning of the
multilateral trading system by enhancing the transparency of Members’trade policies.
c)All WTO Members are subject to review underthe TPRM. The Annex
mandates that the four Members with the largest shares of world trade
(currently the European Communities, the United States, Japan and
China) be reviewed each two years, the next 16 be reviewed each
four years, and others be reviewed each six years. A longer period
may be fixed for least-developed country Members
5 New Issues: Doha Agenda
The Doha Round is the latest round of trade negotiations among the WTO
membership. Its aim is to achieve major reform of the international trading
system through the introduction of lower trade barriers and revised trade rules.
The work programme covers about 20 areas of trade. The Round is also known
semi-officially as the Doha Development Agenda as a fundamental objective is to
improve the trading prospects of developing countries.
The Round was officially launched at the WTO rth Ministerial’Fou Conference in
Doha, Qatar, in November 2001. The Doha Ministerial Declaration provided the
mandate for the negotiations, including on agriculture, services and an
intellectual property topic, which began earlier.
In Doha, ministers also approved a decision on how to address the problems
developing countries face in implementing the current WTO agreements.