G/AG/R/19
Page 1

World Trade
Organization / RESTRICTED
G/AG/R/19
25 August 1999
(99-3527)
Committee on Agriculture

SUMMARY REPORT OF THE MEETING HELD ON 24-25 JUNE 1999

Note by the Secretariat

  1. The Committee on Agriculture held its nineteenth meeting on 24-25 June 1999 under the Chairmanship of Ambassador Nestor Osorio Londoño of Colombia. The agenda of the meeting as contained in WTO/AIR/1111 was adopted.

Part I: The Review Process

Matters Relevant to the Implementation of Commitments under the Reform Programme: Article 18.6

(a)Canada: Trinidad and Tobago - Applied terms of access for pork

  1. Canada requested a written clarification on the terms of access that apply to pork products, including the currently applied tariff, other duties and charges and any other administrative requirements. Trinidad and Tobago provided a written reply stating that, as far as it could determine, imports of pork products from Canada had not experienced delays in obtaining the required permits. While offering consultations with Canada, Trinidad and Tobago asked that further queries be more specific to enable them to make more focused enquiries.

(b)Canada: United States - Milk marketing plans in the state of California

  1. Canada enquired whether the export subsidy notification made by the United States (G/AG/N/USA/12) included exports of certain dairy products produced in California. The United States noted that exports from California under its milk marketing programme were not included in the notification. While they were unable to give details of the quantities exported, or the value of the subsidies provided, the United States noted that the volumes of exports involved were relatively small and undertook to examine the issue and provide details as soon as possible.

(c)Canada: Australia - Milk pricing policy in the state of Victoria

  1. Canada requested confirmation from Australia that the Victorian Dairy Industry Authority established lower prices for milk for processing into certain products for sale by export compared to milk for processing into the same products for sale within Australia.
  2. Australia confirmed that the Victorian Dairy Industry Authority has arrangements in place which effectively subsidized exports of pasteurized, ultra heat treated or sterilized milk. The State level arrangement resulted in the provision of milk for processing for sale by export at a lower price than for milk for processing into the same products for sale within Australia. The arrangement had not previously been brought to the attention of the Commonwealth Government and consequently had not been included in Australia's export subsidy notifications. Australia would ensure that any product exported under this arrangement would be reflected in future export subsidy notifications. Preliminary analysis indicated that only marginal exports had occurred under this arrangement and these export levels would be well within Australia's export subsidy reduction commitment for "other milk products". The Australian Government is currently considering proposals for the deregulation of market (drinking) milk in Australia. Deregulation would remove all state controls on market milk including the pricing arrangement that Canada had brought to the attention of the Committee.
  3. The Philippines and Switzerland noted that all sub-federal measures should be notified and that federal governments should ensure that all such measures complied with commitments.

(d)New Zealand: Venezuela - Milk powder tariffs

  1. New Zealand sought reassurance from Venezuela that there would be no breaches of commitments caused by the application of the Andean price band system on whole milk powder. Venezuela undertook to address the issue, noting that there had been delays resulting from the introduction of a new customs law.

(e)United States: Chile - Tariff bindings on price band commodities

  1. The United States considered that the application of the domestic price band system had resulted in tariffs in excess of bound levels by Chile. The representative of the United States sought details on what measures were being taken by Chile to bring its tariffs into compliance with its WTO commitments.
  2. The representative of Chile noted that low prices in international markets along with the low tariff levels in Chile, coupled with no subsidies, had had a severe impact on domestic producers. The price band system was aimed at reducing the effect of international price fluctuations on the internal market by using the average historical price and, in normal situations, this should not result in any breach of bindings. However, the extent of the price falls in recent times had meant that, in some cases, the applied tariff was greater than the bound commitment. However, Chile maintained that this should not have an effect on trade as the demand was relatively stable regardless of price.
  3. Chile had undertaken a round of consultations with all interested countries, including the United States, with the objective of explaining and gaining acceptance for this transitional situation. They undertook to review the matter if it was not resolved in the near future.
  4. While noting that Chile was facing difficult circumstances the United States urged Chile to comply with their obligations. The European Communities pointed out that there were other WTO- compatible measures which could have been taken.

(f)United States: Jamaica - Import licence regulations

  1. The United States sought confirmation on the implementation of new import regulations which restricted the issuance of import permits for various products destined for hotels, fast food companies and processors. Jamaica undertook to give a reply in writing as soon as possible.

(g)United States: Venezuela - Tariff quota for pork and import permit restrictions

  1. The United States sought clarification regarding Venezuela's import procedures for pork, in particular as regards licences for quantities above tariff quota levels. In addition, the United States enquired about new measures for beef and horticultural products and if these measures had been notified to the Committee on Agriculture.
  2. The representative of Venezuela pointed out that it was holding consultations in Caracas although it maintained that imports exceeded tariff quota levels and no other restrictions were applied. The representative of the United States stated that it would continue to pursue the matter following reports it had received on difficulties obtaining licences. The representative of the European Communities sought more information while Canada expressed its interest in this matter.

Review of Notifications

  1. The Committee reviewed the following notifications as listed in the agenda:

(i)on the administration of tariff and other quota commitments (Table MA:1): from Guatemala (G/AG/N/GTM/16), Hungary (G/AG/N/HUN/18), Latvia (G/AG/N/LVA/1), Thailand (G/AG/N/THA/30 and G/AG/N/THA/34) andVenezuela (G/AG/N/VEN/11);

(ii)relating to imports under tariff and other quota commitments (Table MA:2): from Canada (G/AG/N/CAN/27), Colombia (G/AG/N/COL/18 and G/AG/N/COL/10/Rev.1/Corr.1), Guatemala (G/AG/N/GTM/13), Hungary (G/AG/N/HUN/17), Israel (G/AG/N/ISR/11), New Zealand (G/AG/N/NZL/19 and Corr.1), Slovenia (G/AG/N/SVN/11) and Venezuela (G/AG/N/VEN/12);

(iii)in the context of the special safeguard (Tables MA:3 to MA:5): from Canada (G/AG/N/CAN/28), Colombia (G/AG/N/COL/17) Ecuador (G/AG/N/ECU/6), Guatemala (G/AG/N/GTM/14), Hungary (G/AG/N/HUN/19), Israel (G/AG/N/ISR/10), Japan (G/AG/N/JPN/35, G/AG/N/JPN/37 and G/AG/N/JPN/38), Switzerland (G/AG/N/CHE/18 and G/AG/N/CHE/19), Thailand (G/AG/N/THA/31) United States (G/AG/N/USA/24 and G/AG/N/USA/26) and Venezuela (G/AG/N/VEN/13);

(iv)relating to domestic support commitments (Table DS:1): from Brazil (G/AG/N/BRA/13), Egypt (G/AG/N/EGY/1), European Communities (G/AG/N/EEC/16), Guatemala (G/AG/N/GTM/11), Honduras (G/AG/N/HND/4 and G/AG/N/HND/6), Israel (G/AG/N/ISR/12), Mexico (G/AG/N/MEX/5), Norway (G/AG/N/NOR/22), Sri Lanka (G/AG/N/LKA/2), Thailand (G/AG/N/THA/29) and Turkey (G/AG/N/TUR/6, G/AG/N/TUR/6/Corr.1 and G/AG/N/TUR/8);

(v)relating to new or modified domestic support measures exempt from reduction (TableDS:2): from Switzerland (G/AG/N/CHE/20) and United States (G/AG/N/USA/25).

(vi)relating to export subsidy commitments (Tables ES:1 to ES:3): from Argentina (G/AG/N/ARG/8), Australia (G/AG/N/AUS/24), Brazil (G/AG/N/BRA/14), Colombia (G/AG/N/COL/11, G/AG/N/COL/12, G/AG/N/COL/13, G/AG/N/COL/14, G/AG/N/COL/15 and G/AG/N/COL/16), Ecuador (G/AG/N/ECU/7), Egypt (G/AG/N/EGY/2), Guatemala (G/AG/N/GTM/12 and G/AG/N/GTM/15), Japan (G/AG/N/JPN/36), Mongolia (G/AG/N/MNG/3), Pakistan (G/AG/N/PAK/7), Qatar (G/AG/N/QAT/2), Sri Lanka (G/AG/N/LKA/1), Thailand (G/AG/N/THA/32 and G/AG/N/THA/33), Turkey (G/AG/N/TUR/9) and Venezuela (G/AG/N/VEN/15 and G/AG/N/VEN/15/Corr.1).

  1. With respect to points concerning notifications raised at previous meetings that had been pursued bilaterally (Part I, Agenda Item C), the representative of Canada informed the Committee that Canada had submitted further questions to the United States and the European Communities about their notifications relating to imports under tariff and other quota commitments (Table MA:2). Concerning notifications G/AG/N/EEC/8 and G/AG/N/EEC/13 Canada had asked the European Communities for the volume of imports at MFN and at preferential rates for each of its tariff quotas and the applied duties in each case. Concerning notification G/AG/N/USA/23 Canada had asked the United States for details regarding the volume of imports at MFN and at preferential rates for its tariff quotas for beef, dairy, peanuts and peanut products and sugar and sugar containing products and the applied duties in each case.
  2. The following notifications were subject to preliminary review and are to be reverted to at the next meeting in accordance with paragraph 9 of the Committee's Working Procedures:

(i)on special safeguard (Tables MA:3 to MA:5): from Hungary (G/AG/N/HUN/20);

(ii)on export subsidy commitments (Tables ES:1 to ES:3): from Switzerland (G/AG/N/CHE/24 and Corr.1).

  1. The Committee took note that no counter-notifications had been received under Article 18.7 of the Agreement.

Other matters relating to the Review Process

(a)Deferred replies to questions raised under the review process

  1. The deferred replies to questions raised at previous meetings are summarized in Part II of the Annex to this report.

(b)Overdue notifications

  1. The Chairman drew the Committee's attention to the current status of compliance with the Committee's notification requirements, as reflected in the Room Document made available by the Secretariat, dated 24 June 1999.
  2. The United States noted that Canada had still to submit its 1996 domestic support notification and the European Communities its 1996 export subsidy notification. Canada and the EC stated that they would be making their respective notifications in the near future.

(c)Notification issues

  1. The Committee discussed the Secretariat paper (G/AG/W/45) on notification issues in an informal session.

Part II: Other Matters within the Purview of the Committee

Secretariat Background Note on Implementation of the Marrakesh Ministerial Decision

  1. The Secretariat background note G/AG/W/42 of 10 February 1999 was prepared in response to the request made at the November 1998 meeting of the Committee on Agriculture. Following a preliminary discussion at the March meeting Members were given the opportunity for a substantive discussion at this meeting.

Review of the WTO List of Net Food-Importing Developing Countries

  1. The Chairman noted that paragraph 3 of G/AG/3 provides that the list of Net Food-Importing Developing Countries for the purposes of the Marrakesh Ministerial Decision shall be reviewed at the regular March meetings of the Committee on Agriculture but in practice the Committee has acted on applications as and when these have been presented.
  2. The Committee agreed that Cuba be included in the WTO List of Net Food-Importing Developing Countries. Cuba's application was submitted on 11 May and included relevant supporting statistical data in line with paragraph 2 of the Committee's decision on the establishment of the list. Mexico stated that, in their opinion, G/AG/3 only required an applicant country to provide the relevant supporting data to be included in the list of net food-importing countries and the Committee's approval was not needed. The revised list has been issued as G/AG/5/Rev.3 dated 28 June 1999.

Process of Analysis and Information Exchange (AIE process)

Chairman's Report

  1. The Committee took note of the following report by the Chairman on the recent meeting of the AIE process:

"(i)In line with paragraph 36 of G/AG/R/10 the following is my summary report as Chairman of the eleventh meeting of the AIE process held on 23-24 June 1999.

(ii)Consideration of non-trade concerns continued at this meeting with substantive discussion of the paper by Mauritius "Multifunctional Role of Agriculture in Small Island Developing States" (AIE/51). This paper addressed the characteristics of agriculture in small developing island states and its role in their social and economic development. It was suggested that flexibility in making and implementing commitments was needed in order to allow these countries to address their specific concerns.

(iii)Once again it was noted that different countries focus on different issues which come under the broad heading of non-trade concerns. Many less developed countries tend to concentrate on rural employment, attenuation of the effects of rural out-migration and poverty alleviation. On the other hand, some developed countries place particular emphasis on issues such as landscape, environment and domestic income equality. It was noted that food security was of interest to all Members although particularly for low income countries.

(iv)Specificities of small island states and the importance of their non-trade concerns were recognized. It was also recalled that existing provisions were sufficient to address them and that protectionism in pursuit of non-trade objectives could reduce development opportunities for other countries.

(v)A number of other papers on multifunctionality were introduced at this meeting and will be the subject of substantive discussion at the next one. These included papers by Norway "Food Security and the Role of Domestic Agricultural Production" (AIE/57), two papers by Japan "Multi-functionality in Japan" (AIE/60) and "Food Security" (AIE/61) and by the United States "The 'Multifunctional' Character of Agriculture, Food Security and Other non-Trade Concerns" (AIE/64).

(vi)The European Communities' paper "Article 5: Special Safeguard Clause for Agriculture" put forward the opinion that this provision was introduced to assist tariffication and that it should remain in force. In the discussion the concerns expressed at the November AIE meeting in response to New Zealand's paper (AIE/20) about the application of Article 5 were reiterated although it was noted that special safeguards have not been used extensively. It was pointed out that the provision does cause some uncertainty for exporters although it was also considered that special safeguards can be a useful mechanism for addressing concerns about sudden price falls or import surges.

(vii)Market access issues of concern to developing countries were addressed in the paper by El Salvador, Honduras, Cuba, Nicaragua, the Dominican Republic and Pakistan "Issues Related to Market Access" (AIE/54). This paper highlighted a number of factors which reduced market access opportunities for developing countries and suggested a number of ways in which the situation could be improved.

(viii)In the discussion there was general recognition that special and differential treatment will remain an integral element of the forthcoming negotiations although the exact nature of the provisions will be a matter to be taken up in the course of these negotiations. It was also pointed out that existing special and differential treatment provisions may go some way towards addressing the concerns expressed in the paper.

(ix)Also on market access, the United States introduced their paper "High In-Quota Duties" (AIE/56) which outlined some of the issues related to in-quota tariff rates and the need for information on the relationship between quota fill rates and in-quota tariff rates. Canada's paper "Data Requirements for Agriculture Negotiations" (AIE/55) also highlighted the need for information on in-quota tariff rates. The paper pointed out the information currently available from various sources and the deficiencies associated with them. It stressed the usefulness for all Members to have complete and accurate data in the forthcoming negotiations.

(x)In the discussion of Canada's paper it was stressed that more data would be useful but that this should not delay the start of negotiations. It was also pointed out that timely and full compliance with notification obligations would go some way towards filling the gaps in Members' data requirements.

(xi)The European Communities' paper "The Agreement on Agriculture and the Need for Legal Security" (AIE/53) underlined the importance of legal security for existing commitments as well as the commitments to be made as a result of the forthcoming negotiations. In the discussion it was suggested that this security may need to go beyond the existing coverage provided by Article 13. However, different views were expressed about both any prolongation of the existing peace clause and about any extension of its scope. It was pointed out that before a due restraint clause could be considered some idea of the future commitments would be needed. The point was also made that it will be necessary to avoid undermining other Members' rights to protect their trade interests although the view was also expressed that Members complying with their commitments under the agriculture agreement needed to have assurance that they would not be subjected to undue challenges under other WTO provisions.