WT/ACC/10/Rev.3
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Organization
WT/ACC/10/Rev.3
28 November 2005
(05-5640)
TECHNICAL NOTE ON THE ACCESSION PROCESS
Note by the Secretariat
Revision
The present paper has been updated by the Secretariat to reflect recent accessions. This paper was originally produced in response to a request by the General Council for a Technical Note on the Accession Process (WT/GC/M/32).
This paper contains information on completed accessions. Information on current accessions applications and Working Parties is contained in document WT/ACC/11 and subsequent revisions.
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TABLE OF CONTENTS
I.OVERVIEW
II.RELEVANT WTO PROVISIONS
III.THE ACCESSION PROCESS
1.General
(a)Procedures
(b)Status of Accession Working Parties
2.Establishment of Working Party
3.Collection of Factual Information
(a)Memorandum
(b)Copies of legislation
(c)Data on applied duty rates
(d)Data on agricultural domestic support and export subsidies
(e)Data on services
(f)Questions and Replies
(g)Examination of the trade regime
4.Negotiation of Terms of Accession
(a)Rules
-Transitional arrangements
(b)Market access for goods
-Schedule of Concessions and Commitments on Goods, tariff concessions
-Sectoral initiatives
-Agricultural commitments
(c)Services
5.Completion of the Working Party Mandate
6.Adoption of Working Party Report by General Council, Entry into Force of Protocol of Accession
7.Invocation of ArticleXIII of the WTO Agreement
IV.LEAST-DEVELOPED COUNTRIES
V.TECHNICAL ASSISTANCE
VI.DISCUSSIONS ON THE ACCESSION PROCESS - RECENT DEVELOPMENTS
ANNEX 1 – List of Documents Dealing with Accession to the WTO
ANNEX 2 – General Council Decisions and Protocols of Accession
ANNEX 3 – Commitments on Rules
- ECONOMIC POLICIES
- FRAMEWORK FOR MAKING AND ENFORCING POLICIES
- POLICIES AFFECTING TRADE IN GOODS
- IMPORT REGULATION
-EXPORT REGULATION
- Internal Policies Affecting Foreign Trade in Goods
-TRADE-RELATED INTELLECTUAL PROPERTY REGIME
-POLICIES AFFECTING TRADE IN SERVICES
- TRANSPARENCY
- TRADE AGREEMENTS
-CONCLUSIONS
ANNEX 4 – Commitments on Services
(a)Horizontal commitments
(b)Sector specific commitments
1. BUSINESS SERVICES
2.Communication services
3. Construction services
4. Distribution services
5. Educational services
6. Environmental services
7. Financial services
8. Health and social services
9. Tourism And travel-related services
10. Recreational services
11. Transport services
MFN EXEMPTIONS
ANNEX 5 – Transitional Arrangements
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i.Overview
This Technical Note reviews the process of WTO accession and updates the information contained in document WT/ACC/10/Rev.2. The aim of this paper is to assist in discussion of the accession process as a whole, rather than to provide specific analysis of particular cases.
Part II of this Note reproduces the relevant WTO provisions that govern the accession process – in particular ArticleXII of the WTO Agreement. Negotiating accession to the WTO under ArticleXII is much more complex compared to accession to the GATT1947, largely due to the increased scope and coverage of the WTO Agreement. The WTO process is also more structured and transparent.
Part III describes the modalities of the accession process. The Secretariat, in consultation with WTO Members, has drawn up a set of procedures to be followed during the accession process (outlined in documents WT/ACC/1, 4, 5, 8 and 9).[1] This Note examines experience with their operation since the WTO Agreement entered into force on 1 January 1995 using, as a reference point, the experience of Working Parties that have concluded their work.[2]
The first substantive phase of the accession process begins withcollection of factual information on the acceding government's trade regime. During this fact-finding stage, the submission of a Memorandum, describing in detail the Applicant's foreign trade regime, is essential for activating the work of the Working Party. On the basis of this document, Members examine the trade and legal regime of the Applicant, asking for clarifications or additional data where necessary, and identifying areas of possible inconsistency with the WTO Agreements. This examination continues through written exchanges of Questions and Replies between members of the Working Party and the Applicant. As the information-gathering stage advances, and in order to ensure the transparency of the process, the Secretariat is requested to circulate a Factual Summary of Points Raised – an informal document summarizing discussions in the Working Party. This document gradually develops into a draft Working Party Report.
The next stage of the accession process, which often overlaps with the fact-finding stage, is the negotiation of the Applicant's terms of accession. Negotiations fall into two main categories - negotiations on multilateral rules, and bilateral market access negotiations.
Multilateral negotiations on rules relate to goods (including systemic agricultural issues), TRIPS and systemic issues in services. Acceding governments are expected to observe the rules set out in the WTO Agreement, as well as the binding commitments negotiated and finally agreed in their Protocol of Accession or in the relevant commitment paragraphs of the Working Party Report, which are incorporated in the Protocol of Accession. Annex3 reproduces the commitments on rules undertaken in completed accessions.
Bilateral market access negotiations begin following the Applicant's submission of offers on concessions and commitments in the goods and services sectors. As the negotiations advance, these initial market access offers are revised to take account of the progress achieved or expected. The results of the negotiations on goods are annexed to the Applicant's Protocol of Accession in the Goods Schedule. This Note examines, in particular, the tariff concessions granted on agricultural and non-agricultural products by new Members. It also surveys agricultural commitments on domestic support and export subsidies, as well as tariff rate quotas and special safeguard provisions. As for services, the results of the bilateral market access negotiations are attached to the Applicant's Protocol in the Schedule of Specific Commitments on Services. This Note provides a synoptic overview of the specific commitments undertaken by new Members, followed by a more detailed summary of commitments on services contained in Annex 4.
Acceding governments usually hold plurilateral meetings with interested members of the Working Party on issues such as agricultural support measures, sanitary and phytosanitary measures, technical standards and regulations, etc. These help towards paving the way for a multilateral agreement on the systemic issues in agriculture as well as in other WTO agreements, as needed.
Transitional arrangements have been the subject of considerable discussion in accession Working Parties. The transition periods granted to original WTO Members during the Uruguay Round are not automatic to governments acceding under Article XII. However, transitional arrangements have been granted in some accessions in a limited number of areas and for specific periods of time, following submissions by Applicants of detailed action plans ensuring WTO consistency in all other related areasby the date of accession. Transition periods have been extended more readily to least-developed country (LDC) Applicants, allowing them greater flexibility for bringing their foreign trade regime into WTO conformity (see Annex 5).
Annex 2 briefly examines the texts of new Members' Protocols of Accession. These incorporate the relevant commitment paragraphs of the Working Party Report, as well as the Goods and Services Schedules. A Protocol sets out the terms which WTO Members agree with an acceding governmentin a single package. All the obligations in this package are enforceable through the Dispute Settlement Understanding of the WTO.
Part IV of this Note surveys the situation of LDC Applicants, which has been the subject of particular attention. In December 2002, recognizing the special needs of acceding LDCs, the General Council adopted Guidelines4 to facilitate and accelerate negotiations with acceding LDCs in accordance with paragraph 42 of the Doha Ministerial Declaration[5] and the mandate in paragraph 18(iii) of the WTO Work Programme on LDCs.[6] The Guidelines made provisions for simplified and streamlined accession procedures for LDCs, while reaffirming the role of technical assistance and capacity building. Representatives from all LDC Applicants participate regularly in intensive training courses and seminars organised by the Secretariat. In addition, the Integrated Framework for coordination and delivery of trade-related technical assistance to LDCs links the WTO with UNCTAD, ITC, IMF, the World Bank and UNDP. Following the adoption of the Guidelines, Nepal and Cambodia became the first LDCs to accede successfully to the WTO under Article XII.
Part V provides information on the technical co-operation activities of the WTO Secretariat, as well as those of national governments and other international organisations. The Secretariat provides technical assistance to all acceding governments on request, within the limit of available resources. All governments in the process of accession have received such assistance in various forms – regional or Geneva-based courses or seminars; focussed assistance in the provision of information needed by the Working Party; assistance in the drafting of legislation; tabling of offers; training courses, etc. In addition, the Secretariat takes all possible steps to co-ordinate technical assistance related to accessions provided by other organisations and WTO Member governments.
Part VI summarises the discussions on the process of accession to the WTO, which have taken place at Ministerial Conferences and at meetings of the General Council. Specifically, the discussions have focused on the procedures laid down for accession under Article XII; the transparency and pace of the accession process; whether the fact-finding stage overburdensApplicants, particularly the smaller economies; the terms and conditions of accession, in particular the availability of special and differential treatment and transition periods; the special needs of acceding LDC Applicants; the provision and co-ordination of technical assistance; and the relationship between accessions and the multilateral trade negotiations.
The Accessions dossier remains a major priority for the WTO. Ongoing accessions are at different stages of the process and WTO Members would like to see these concluded as soon as possible. On their side, the acceding governments are keen to participate in the work of the WTO as full and effective players. This would also ensure that these governments maintain the momentum of their domestic reform processes and that the evolution of domestic reform remains consistent with evolving WTO rules and disciplines.
II.Relevant WTO Provisions
ArticleXII of the Marrakesh Agreement Establishing the World Trade Organization deals with accession. The full text of this provision reads as follows:
"1.Any State or separate customs territory possessing full autonomy in the conduct of its external commercial relations and of the other matters provided for in this Agreement and the Multilateral Trade Agreements may accede to this Agreement, on terms to be agreed between it and the WTO. Such accession shall apply to this Agreement and the Multilateral Trade Agreements annexed thereto.
2.Decisions on accession shall be taken by the Ministerial Conference. The Ministerial Conference shall approve the agreement on the terms of accession by a two-thirds majority of the Members of the WTO.
3.Accession to a Plurilateral Trade Agreement shall be governed by the provisions of that Agreement."
Perhaps the most striking feature of WTO ArticleXII is its brevity. It gives no guidance on the "terms to be agreed", these being left to negotiations between the WTO Members and the Applicant. Nor does it lay down any procedures to be used for negotiating these terms, the latter being left to individual Working Parties to agree. These procedures have evolved separately as will be discussed in the next part of this Note. In this, it follows closely the corresponding ArticleXXXIII of GATT 1947.
A number of other WTO provisions are relevant to the accession process:
-ArticleXVI:1 lays down that "Except as otherwise provided under this Agreement or the Multilateral Trade Agreements, the WTO shall be guided by the decisions, procedures and customary practices followed by the CONTRACTING PARTIES to GATT 1947 and the bodies established in the framework of GATT 1947";
-ArticleXII:2 states that "Decisions on accession shall be taken by the Ministerial Conference", ArticleIV:2 makes it clear that "In the intervals between meetings of the Ministerial Conference, its functions shall be conducted by the General Council";
-ArticleIX deals with decision-making. On 15November1995 the General Council agreed to procedures regarding decision-making under ArticlesIX and XII of the WTO Agreement which clarified the relation between these two provisions (WT/GC/M/8, page 6); and
-ArticleXIII, paragraphs 1 and 3, state that:
"1.This Agreement and the Multilateral Trade Agreements in Annexes 1 and 2 shall not apply as between any Member and any other Member if either of the Members, at the time either becomes a Member, does not consent to such application.
[...]
3.Paragraph 1 shall apply between a Member and another Member which has acceded under ArticleXII only if the Member not consenting to the application has so notified the Ministerial Conference before the approval of the agreement on the terms of accession by the Ministerial Conference";
iii.The Accession Process
1.General
(a)Procedures
The organization and pursuit of accession negotiations in each Working Party follow a well-established pattern based on procedures set out in a note by the Secretariat – document WT/ACC/1 of 24March1995. These procedures were modelled on those followed by the CONTRACTINGPARTIES to GATT 1947, including the Complementary Procedures on Accession Negotiations agreed by the Council of GATT1947 on 27October1993 (L/7317) and the statement by the Chairman of the Council of GATT1947 on the Management of Accession Negotiations on 10November1994 (C/COM/4). Before issuing document WT/ACC/1, the Secretariat consulted extensively with interested WTO Members and took the views expressed into account. During these consultations an understanding was reached that document WT/ACC/1 would not be submitted to the Ministerial Conference/General Council (hereinafter referred to as the General Council unless specific reference to the Ministerial Conference is required) or to individual Working Parties for formal endorsement but that it would be prepared as a practical guide for delegations of both WTO Members and acceding governments and not as a general policy statement on accession negotiations (see document WT/ACC/1, paragraph 2).
Document WT/ACC/1 sets out the different stages in the accession process. The General Council considers applications to accede under WTO ArticleXII and decides on the establishment of a Working Party. The essence of the multilateral work of the Working Party begins with the submission of a Memorandum on the Foreign Trade Regime by the Applicant government. The Working Party first conducts a factual examination of the trade regime of the acceding government on the basis of the Memorandum, as well as replies to Members' questions on the Memorandum. At an appropriate moment, it moves on to negotiate the terms of accession, which relate to three main areas - WTO rules on goods, TRIPS and systemic issues in the area of services. Bilateral market access negotiations on goods and services, between interested Members and the acceding government,proceed in parallel to the multilateral work. When agreement is reached, the Report of the Working Party, including a draft Decision and Protocol of Accession, is forwarded to the General Council. The Protocol - which contains a single package of agreed commitments on rules, concessions and commitments on goods, and specific commitments on services - sets out the terms on which the Applicant is invited to join the WTO. Following the General Council's adoption of the Report and approval of the draft Decision, the acceding government becomes a Member of the WTO thirty days after it formally accepts its Protocol of Accession by domestic ratification.
Document WT/ACC/1 is supplemented by four Technical Notes by the Secretariat:
WT/ACC/4 - Information to be provided on Domestic Support and Export Subsidies in Agriculture. This document is designed to identify agricultural policy measures under the Agreement on Agriculture on which such information is required;
WT/ACC/5 - Information to be Provided on Policy Measures Affecting Trade in Services. This document is designed to facilitate the description of policy measures maintained by acceding governments and which are relevant to the provisions of the General Agreement on Trade in Services (GATS);
WT/ACC/8 - Information to be Provided on Policy Measures with Respect to SPS and TBT Issues. This document is designed as a questionnaire to assist acceding governments in the provision of information, which will facilitate discussion on SPS/TBT issues; and
WT/ACC/9 (and Corr.1) - Information to be Provided on Implementation of the TRIPS Agreement. Designed as a questionnaire, this document is prepared to assist acceding governments in the provision of information, which will facilitate discussion on TRIPS-related issues.
The Accessions Division of the Secretariat has regular consultations with acceding governments, WTO Members and Chairpersons on the programme of meetings and agenda of accession Working Parties.
(b)Status of Accession Working Parties
More than fifty governments have applied to accede under ArticleXII since the WTO Agreement entered into force on 1January1995. A number of applications consisted of requests made earlier to accede to GATT1947, which were converted into requests for accession to the WTO. Pursuant to the decision adopted by the General Council on 31January1995, GATT1947 Working Parties were converted into WTO Working Parties.
Twenty-one of these have completed the accession procedures and have become WTO Members. These are, in the order in which they acceded:
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- Ecuador;
- Bulgaria;
- Mongolia;
- Panama;
- KyrgyzRepublic;
- Latvia;
- Estonia;
- Jordan;
- Georgia;
- Albania;
- Oman;
- Croatia;
- Lithuania;
- Moldova;
- China;
- Chinese Taipei;
- Armenia;
- Former Yugoslav Republic of Macedonia (FYROM);
- Nepal;
- Cambodia; and
- Saudi Arabia.
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Table 1, Timetable of Completed Accessions, provides information on the dates of application, circulation of key documents, and the dates of accession of the governments that have negotiated their WTO accession under Article XII. It also presents a timeline of events between the presentation of the Memorandum (which marks the beginning of the substantive work of the Working Party) and accession. The shortest accession process has overall taken 2 years 10 months (Kyrgyz Republic) and the longest 15 years 5 months (China).