WTO Negotiations on Trade Facilitation Formalities

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WTO Negotiations on Trade Facilitation -
Formalities

• Birgit Viohl, UNCTAD
• Trade Facilitation Section

Single Window ConferenceDakar, 5-7 November 2008
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History of TF in the WTO
Singapore Issues
July Package
200x
1996
2001
2003
2004
1. WTO Ministerial Conference
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 July Package  2004

• On 1 August 2004, Members of the WTO General
  Council agreed on a Doha Work Programme
  (WT/L/579) a framework and agreements for the
  negotiations. Contains 4 Annexes
• The General Council decided to commence
  negotiations on TF on the basis of the modalities
  set out in Annex D. Trade Facilitation
  negotiations part of the Single Undertaking
• Annex D becomes the modalities text of the TF
  negotiations

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Annex D Modalities

• Objective of negotiations (para 1)
• Scope of negotiation
•  Clarify and improve relevant aspects of GATT
  Articles V, VIII and X. 
•  Enhance technical assistance and support for
  capacity building. 
•  Provide effective cooperation between customs
  or other appropriate authorities on TF and
  customs compliance 
• Establishes a Negotiation Group on Trade
  Facilitation
• Framework for SDT provisions

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Scope of negotiations

• Clarify and improve relevant aspects of Art V,
  VIII and X od GATT 1994
• GATT Art.V Freedom of Transit
• GATT Art.VIII Fees and Formalities connected with
  Importation and Exportation
• GATT Art.X Publication and Administration of
  Trade Regulations
• Limited Scope
• Only GATT 1994 No other agreements
• Only documentary and procedural aspects of
  cross-border trade and related information flow

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Formalities

• Trade related formalities are necessary to comply
  with the requirements of Customs and transport
  procedures but also to general trade such as
  phytosanitary certificate, Certificate of Origin,
  import licences.
• Filling out of documents, lodging of documents,
  provision of x copies of commercial documents,
  payments etc.
• Burden
• Cumbersome procedures and cumbersome formalities
  and paperwork
• Problem
• Direct and indirect costs to trade
• Create operational inefficiencies and reduce
  control and security along the logistics chain.

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Multilateral framework

• WTO Law contains disciplines related to certain
  aspects of the administration of trade related
  procedures
• in particular Article VIII of GATT 1994
• and also in the agreements in annex to the GATT
  1994, e.g. Rules of Origin, Import Licence
• But non-mandatory legal language of Article VIII
  GATT 1994

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• July 2004 WTO members decided to start
  negotiations on Trade Facilitation
• Review with the aim to clarify and strengthen
  those aspects of the GATT 1994 agreement related
  to trade facilitation Art. V, VIII, and X
• Art. VIII Fees and formalities related to
  importation and exportation
• Negotiations are on-going aspart of the Doha
  Round

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In Geneva they negotiateso what?

• Business is moving ahead and provides solutions
• But
• Need for political will for successful
  implementation
• one can not change neighbours systems and
  procedures
• multilateral rules refer to technical standards
  which then become regional or intl norms
• financial resources and technical assistance

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Elements of GATT VIII

• All fees and charges shall be limited in
  amount to the approximate cost of services
  rendered
• The contracting parties recognize the need for
• Reducing the number and diversity of fees
  charges
• Minimizing the incidence and complexity of
  import/export formalities
• Decreasing and simplifying import/export
  documentation requirements

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Negotiation Process

• WTO Members propose trade facilitation measures
  which are
• Procedures, tools, standards which are in
  practice or internationally developed
• Clearer legal language of the Articles provision

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Proposals made at the WTO
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Article VIIIProposals on fees and charges

• Fees and charges
• Specific parameters for fees and charges
• Publication / Notification
• Periodic review
• Automated payment (this has not been further
  proposed)

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Proposals on formalities

• Reduction of import/export formalities and
  documentary requirements
• Periodic reviews of formalities
• Use of international standards
• Acceptance of Commercially Available Information
  and Copies
• Single Window/ One-time submission
• Prohibition of Consular Requirements
• Disciplines on Mandatory use of Customs Brokers
• Release and Clearance of Goods
• Pre-arrival clearance
• Express shipments with special treatment
• Risk management based on international standards
• Simplified procedures for authorized traders
• Post-clearance audit
• Seperating Release from Clearance
• Publication of Average Release and Clearance Times

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Proposals on formalities

• Reduction of import/export formalities and
  documentary requirements
• Periodic reviews of formalities
• Use of international standards
• Acceptance of Commercially Available Information
  and Copies
• Single Window/ One-time submission
• Prohibition of Consular Requirements
• Disciplines on Mandatory use of Customs Brokers
• Release and Clearance of Goods
• Pre-arrival clearance
• Express shipments with special treatment
• Risk management based on international standards
• Simplified procedures for authorized traders
• Post-clearance audit
• Seperating Release from Clearance
• Publication of Average Release and Clearance Times

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Proposal Single Window

• SW early proposal (EC, Peru, Korea, Singapore,
  Japan Mongolia etc.)
• Problem of different definitions and concept of
  SW.
• What should the WTO attempt to do? Detailed
  definition versus broad concept. Stipulate
  operational standards
• Single Window as a stand alone measure to speed
  up the Customs release and clearance, but by
  moving to a SW

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Proposal Single Window

• other proposed disciplines are addressed as well
  (modular set-up Analysis and Re-engeneering of
  processes, Re-definition of data and document
  requirements, Introduction of international
  standards)
• Reduction/Limitation of Formalities
• Use of Intl Standards
• Acceptance of Commercially Available Information
  and copies
• SW offers also platform for information exchange
  on trade related legislation (Transparency Art.
  X)
• and strengthens Border Agency cooperation and
  cooperation between Customs and the trading
  community

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Implementation issues

• Introduction of SW (mixed or electronic) is
  costly and lengthy.
• Electronic SW a best endeavour option (to the
  extent possible)
• Technical Assistance clause in the negotiations
• Developing countries and LDC only take up
  commitments if they receive the required
  technical assistance
• Negotiations are opportunity to get political
  support and financial resources for pursuing
  trade facilitation reforms, including for SW

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Negotiations still on-going. What needs to be
done?

• Technical knowledge for the drafting of the rule
  required.
• Definition of SW
• Standards used for SW
• Basis for regional inter-operability
• Country-level Analyse current situation.
• Would current SW comply with the rule?
• How long does it take for your country to be in
  compliance
• What does it take your country to be in
  compliance
• Contact negotiating authority to participate in
  drafting this rule and to inform them of the
  existing system

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Thank you !

• Birgit.viohl_at_unctad.org
• Jan.Hoffmann_at_unctad.org