ad Article I
Paragraph 1
The obligations incorporated in paragraph 1 of Article I by reference to paragraphs 2 and 4 of Article III and those incorporated in paragraph 2(b) of Article II by reference to Article VI shall be considered as falling within Part II for the purposes of the Protocol of Provisional Application.
The cross-references, in the paragraph immediately above and in paragraph 1 of Article I, to paragraphs 2 and 4 of Article III shall only apply after Article III has been modified by the entry into force of the
amendment provided for in the Protocol Modifying Part II and Article XXVI of the General Agreement on Tariffs and Trade, dated September 14, 1948.
Paragraph 4
The term “margin of preference” means the absolute difference between the most-favoured-nation
rate of duty and the preferential rate of duty for the like product, and not the proportionate
relation between those rates. As examples:
-
(1) If the most-favoured-nation rate were 36 per cent ad valorem and the preferential rate were 24 per cent ad valorem, the margin of preference would be 12 per cent ad valorem, and not one-third of the most-favoured-nation rate;
-
(2) If the most-favoured-nation rate were 36 per cent ad valorem and the preferential rate were expressed as two-thirds of the most-favoured-nation
rate, the margin of preference would be 12 per cent ad valorem;
-
(3) If the most-favoured-nation rate were 2 francs per kilogram and the preferential rate
were 1.50 francs per kilogram, the margin of preference would be 0.50 francs per kilogram.
The following kinds of customs action, taken in accordance with established uniform
procedures, would not be contrary to a general binding of margins of preference:
-
(i) The re-application to an imported product of a tariff classification or rate of duty,
properly applicable to such product, in cases in which the application of such classification
or rate to such product was temporarily suspended or inoperative on April 10, 1947;
and
-
(ii) The classification of a particular product under a tariff item other than that under
which importations of that product were classified on April 10, 1947, in cases in
which the tariff law clearly contemplates that such product may be classified under
more than one tariff item.
ad Article II
Paragraph 2 (a)
The cross-reference, in paragraph 2 (a) of Article II, to paragraph 2 of Article III shall only apply after Article III has been modified by the entry into force of the
amendment provided for in the Protocol Modifying Part II and Article XXVI of the General Agreement on Tariffs and Trade, dated September 14, 1948.
Paragraph 2 (b)
See the note relating to paragraph 1 of Article I.
Paragraph 4
Except where otherwise specifically agreed between the contracting parties which initially
negotiated the concession, the provisions of this paragraph will be applied in the
light of the provisions of Article 31 of the Havana Charter.
ad Article III
Any internal tax or other internal charge, or any law, regulation or requirement of
the kind referred to in paragraph 1 which applies to an imported product and to the
like domestic product and is collected or enforced in the case of the imported product
at the time or point of importation, is nevertheless to be regarded as an internal
tax or other internal charge, or a law, regulation or requirement of the kind referred
to in paragraph 1, and is accordingly subject to the provisions of Article III.
Paragraph 1
The application of paragraph 1 to internal taxes imposed by local governments and
authorities within the territory of a contracting party is subject to the provisions
of the final paragraph of Article XXIV. The term “reasonable measures” in the last-mentioned paragraph would not require,
for example, the repeal of existing national legislation authorizing local governments
to impose internal taxes which, although technically inconsistent with the letter
of Article III, are not in fact inconsistent with its spirit, if such repeal would result in a serious
financial hardship for the local governments or authorities concerned. With regard
to taxation by local governments or authorities which is inconsistent with both the
letter and spirit of Article III, the term “reasonable measures” would permit a contracting
party to eliminate the inconsistent taxation gradually over a transition period, if
abrupt action would create serious administrative and financial difficulties.
Paragraph 2
A tax conforming to the requirements of the first sentence of paragraph 2 would be
considered to be inconsistent with the provisions of the second sentence only in cases
where competition was involved between, on the one hand, the taxed product and, on
the other hand, a directly competitive or substitutable product which was not similarly
taxed.
Paragraph 5
Regulations consistent with the provisions of the first sentence of paragraph 5 shall
not be considered to be contrary to the provisions of the second sentence in any case
in which all of the products subject to the regulations are produced domestically
in substantial quantities. A regulation cannot be justified as being consistent with
the provisions of the second sentence on the ground that the proportion or amount
allocated to each of the products which are the subject of the regulation constitutes
an equitable relationship between imported and domestic products.
ad Article V
Paragraph 5
With regard to transportation charges, the principle laid down in paragraph 5 refers
to like products being transported on the same route under like conditions.
ad Article VI
Paragraph 1
-
1. Hidden dumping by associated houses (that is, the sale by an importer at a price below
that corresponding to the price invoiced by an exporter with whom the importer is
associated, and also below the price in the exporting country) constitutes a form
of price dumping with respect to which the margin of dumping may be calculated on
the basis of the price at which the goods are resold by the importer.
-
2. It is recognized that, in the case of imports from a country which has a complete
or substantially complete monopoly of its trade and where all domestic prices are
fixed by the State, special difficulties may exist in determining price comparability
for the purposes of paragraph 1, and in such cases importing contracting parties may
find it necessary to take into account the possibility that a strict comparison with
domestic prices in such a country may not always be appropriate.
Paragraphs 2 and 3
Note 1. As in many other cases in customs administration, a contracting party may require
reasonable security (bond or cash deposit) for the payment of anti-dumping or countervailing
duty pending final determination of the facts in any case of suspected dumping or
subsidization.
Note 2. Multiple currency practices can in certain circumstances constitute a subsidy to
exports which may be met by countervailing duties under paragraph 3 or can constitute
a form of dumping by means of a partial depreciation of a country's currency which
may be met by action under paragraph 2. By “multiple currency practices” is meant
practices by governments or sanctioned by governments.
Paragraph 6 (b)
Waivers under the provisions of this sub-paragraph shall be granted only on application
by the contracting party proposing to levy an anti-dumping or countervailing duty,
as the case may be.
ad Article VII
Paragraph 1
The expression “or other charges” is not to be regarded as including internal taxes
or equivalent charges imposed on or in connection with imported products.
Paragraph 2
-
1. It would be in conformity with Article VII to presume that “actual value” may be represented by the invoice price, plus any
nonincluded charges for legitimate costs which are proper elements of “actual value”
and plus any abnormal discount or other reduction from the ordinary competitive price.
-
2. It would be in conformity with Article VII, paragraph 2 (b), for a contracting party to construe the phrase “in the ordinary course of trade
.... under fully competitive conditions”, as excluding any transaction wherein the
buyer and seller are not independent of each other and price is not the sole consideration.
-
3. The standard of “fully competitive conditions” permits a contracting party to exclude
from consideration prices involving special discounts limited to exclusive agents.
-
4. The wording of sub-paragraphs (a) and (b) permits a contracting party to determine
the value for customs purposes uniformly either (1) on the basis of a particular exporter's
prices of the imported merchandise, or (2) on the basis of the general price level
of like merchandise.
ad Article VIII
-
1. While Article VIII does not cover the use of multiple rates of exchange as such, paragraphs 1 and 4
condemn the use of exchange taxes or fees as a device for implementing multiple currency
practices; if, however, a contracting party is using multiple currency exchange fees
for balance of payments reasons with the approval of the International Monetary Fund,
the provisions of paragraph 9 (a) of Article XV fully safeguard its position.
-
2. It would be consistent with paragraph 1 if on the importation of products from the
territory of a contracting party into the territory of another contracting party,
the production of certificates of origin should only be required to the extent that
is strictly indispensable.
ad Articles XI, XII, XIII, XIV and XVIII
Throughout Articles XI, XII, XIII, XIV and XVIII the terms “import restrictions” or “export restrictions” include restrictions made
effective through state-trading operations.
ad Article XI
Paragraph 2 (c)
The term “in any form” in this paragraph covers the same products when in an early
stage of processing and still perishable, which compete directly with the fresh product
and if freely imported would tend to make the restriction on the fresh product ineffective.
Paragraph 2, last sub-paragraph
The term “special factors” includes changes in relative productive efficiency as between
domestic and foreign producers, or as between different foreign producers, but not
changes artificially brought about by means not permitted under the Agreement.
ad Article XII
The CONTRACTING PARTIES shall make provision for the utmost secrecy in the conduct
of any consultation under the provisions of this Article.
Paragraph 3 (c) (i)
Contracting parties applying restrictions shall endeavour to avoid causing serious
prejudice to exports of a commodity on which the economy of a contracting party is
largely dependent.
Paragraph 4 (b)
It is agreed that the date shall be within ninety days after the entry into force
of the amendments of this Article effected by the Protocol Amending the Preamble and
Parts II and III of this Agreement. However, should the CONTRACTING PARTIES find that
conditions were not suitable for the application of the provisions of this sub-paragraph
at the time envisaged, they may determine a later date; Provided that such date is not more than thirty days after such time as the obligations of
Article VIII, Sections 2, 3 and 4 of the Articles of Agreement of the International Monetary Fund become applicable to contracting parties, members of the Fund, the combined foreign
trade of which constitutes at least fifty per centum of the aggregate foreign trade
of all contracting parties.
Paragraph 4 (e)
It is agreed that paragraph 4 (e) does not add any new criteria for the imposition
or maintenance of quantitative restrictions for balance of payments reasons. It is
solely intended to ensure that all external factors such as changes in the terms of
trade, quantitative restrictions, excessive tariffs and subsidies, which may be contributing
to the balance of payments difficulties of the contracting party applying restrictions
will be fully taken into account.
ad Article XIII
Paragraph 2 (d)
No mention was made of “commercial considerations” as a rule for the allocation of
quotas because it was considered that its application by governmental authorities
might not always be practicable. Moreover, in cases where it is practicable, a contracting
party could apply these considerations in the process of seeking agreement, consistently
with the general rule laid down in the opening sentence of paragraph 2.
Paragraph 4
See note relating to “special factors” in connection with the last sub-paragraph of
paragraph 2 of Article XI.
ad Article XIV
Paragraph 1
The provisions of this paragraph shall not be so construed as to preclude full consideration
by the CONTRACTING PARTIES, in the consultations provided for in paragraph 4 of Article XII and in paragraph 12 of Article XVIII, of the nature, effects and reasons for discrimination in the field of import restrictions.
Paragraph 2
One of the situations contemplated in paragraph 2 is that of a contracting party holding
balances acquired as a result of current transactions which it finds itself unable
to use without a measure of discrimination.
ad Article XV
Paragraph 4
The word “frustrate” is intended to indicate, for example, that infringements of the
letter of any Article of this Agreement by exchange action shall not be regarded as
a violation of that Article if, in practice, there is no appreciable departure from
the intent of the Article. Thus, a contracting party which, as part of its exchange
control operated in accordance with the Articles of Agreement of the International Monetary Fund, requires payment to be received for its exports in its own currency or in the currency
of one or more members of the International Monetary Fund will not thereby be deemed
to contravene Article XI or Article XIII. Another example would be that of a contracting party which specifies on an import
licence the country from which the goods may be imported, for the purpose not of introducing
any additional element of discrimination in its import licensing system but of enforcing
permissible exchange controls.
ad Article XVI
The exemption of an exported product from duties or taxes borne by the like product
when destined for domestic consumption, or the remission of such duties or taxes in
amounts not in excess of those which have accrued, shall not be deemed to be a subsidy.
Section B
-
1. Nothing in Section B shall preclude the use by a contracting party of multiple rates
of exchange in accordance with the Articles of Agreement of the International Monetary Fund.
-
2. For the purposes of Section B, a “primary product” is understood to be any product
of farm, forest or fishery, or any mineral, in its natural form or which has undergone
such processing as is customarily required to prepare it for marketing in substantial
volume in international trade.
Paragraph 3
-
1. The fact that a contracting party has not exported the product in question during
the previous representative period would not in itself preclude that contracting party
from establishing its right to obtain a share of the trade in the product concerned.
-
2. A system for the stabilization of the domestic price or of the return to domestic
producers of a primary product independently of the movements of export prices, which
results at times in the sale of the product for export at a price lower than the comparable
price charged for the like product to buyers in the domestic market, shall be considered
not to involve a subsidy on exports within the meaning of paragraph 3 if the CONTRACTING
PARTIES determine that:
-
(a) the system has also resulted, or is so designed as to result, in the sale of the product
for export at a price higher than the comparable price charged for the like product
to buyers in the domestic market; and
-
(b) the system is so operated, or is designed so to operate, either because of the effective
regulation of production or otherwise, as not to stimulate exports unduly or otherwise
seriously to prejudice the interests of other contracting parties.
Notwithstanding such determination by the CONTRACTING PARTIES, operations under such
a system shall be subject to the provisions of paragraph 3 where they are wholly or
partly financed out of government funds in addition to the funds collected from producers
in respect of the product concerned.
Paragraph 4
The intention of paragraph 4 is that the contracting parties should seek before the
end of 1957 to reach agreement to abolish all remaining subsidies as from 1 January
1958; or, failing this, to reach agreement to extend the application of the standstill
until the earliest date thereafter by which they can expect to reach such agreement.
ad Article XVII
Paragraph 1
The operations of Marketing Boards, which are established by contracting parties and
are engaged in purchasing or selling, are subject to the provisions of sub-paragraphs
(a) and (b).
The activities of Marketing Boards which are established by contracting parties and
which do not purchase or sell but lay down regulations covering private trade are
governed by the relevant Articles of this Agreement.
The charging by a state enterprise of different prices for its sales of a product
in different markets is not precluded by the provisions of this Article, provided
that such different prices are charged for commercial reasons, to meet conditions
of supply and demand in export markets.
Paragraph 1 (a)
Governmental measures imposed to ensure standards of quality and efficiency in the
operation of external trade, or privileges granted for the exploitation of national
natural resources but which do not empower the government to exercise control over
the trading activities of the enterprise in question, do not constitute “exclusive
or special privileges”.
Paragraph 1 (b)
A country receiving a “tied loan” is free to take this loan into account as a “commercial
consideration” when purchasing requirements abroad.
Paragraph 2
The term “goods” is limited to products as understood in commercial practice, and
is not intended to include the purchase or sale of services.
Paragraph 3
Negotiations which contracting parties agree to conduct under this paragraph may be
directed towards the reduction of duties and other charges on imports and exports
or towards the conclusion of any other mutually satisfactory arrangement consistent
with the provisions of this Agreement. (See paragraph 4 of Article II and the note to that paragraph.)
Paragraph 4 (b)
The term “import mark-up” in this paragraph shall represent the margin by which the
price charged by the import monopoly for the imported product (exclusive of internal
taxes within the purview of Article III, transportation, distribution, and other expenses incident to the purchase, sale
or further processing, and a reasonable margin of profit) exceeds the landed cost.
ad Article XVIII
The CONTRACTING PARTIES and the contracting parties concerned shall preserve the utmost
secrecy in respect of matters arising under this Article.
Paragraphs 1 and 4
-
1. When they consider whether the economy of a contracting party “can only support low
standards of living”, the CONTRACTING PARTIES shall take into consideration the normal
position of that economy and shall not base their determination on exceptional circumstances
such as those which may result from the temporary existence of exceptionally favourable
conditions for the staple export product or products of such contracting party.
-
2. The phrase “in the early stages of development” is not meant to apply only to contracting
parties which have just started their economic development, but also to contracting
parties the economies of which are undergoing a process of industrialization to correct
an excessive dependence on primary production.
Paragraphs 2, 3, 7, 13 and 22
The reference to the establishment of particular industries shall apply not only to
the establishment of a new industry, but also to the establishment of a new branch
of production in an existing industry and to the substantial transformation of an
existing industry, and to the substantial expansion of an existing industry supplying
a relatively small proportion of the domestic demand. It shall also cover the reconstruction
of an industry destroyed or substantially damaged as a result of hostilities or natural
disasters.
Paragraph 7 (b)
A modification or withdrawal, pursuant to paragraph 7 (b), by a contracting party,
other than the applicant contracting party, referred to in paragraph 7 (a), shall
be made within six months of the day on which the action is taken by the applicant
contracting party, and shall become effective on the thirtieth day following the day
on which such modification or withdrawal has been notified to the CONTRACTING PARTIES.
Paragraph 11
The second sentence in paragraph 11 shall not be interpreted to mean that a contracting
party is required to relax or remove restrictions if such relaxation or removal would
thereupon produce conditions justifying the intensification or institution, respectively,
of restrictions under paragraph 9 of Article XVIII.
Paragraph 12 (b)
The date referred to in paragraph 12 (b) shall be the date determined by the CONTRACTING
PARTIES in accordance with the provisions of paragraph 4 (b) of Article XII of this Agreement.
Paragraphs 13 and 14
It is recognized that, before deciding on the introduction of a measure and notifying
the CONTRACTING PARTIES in accordance with paragraph 14, a contracting party may need
a reasonable period of time to assess the competitive position of the industry concerned.
Paragraphs 15 and 16
It is understood that the CONTRACTING PARTIES shall invite a contracting party proposing
to apply a measure under Section C to consult with them pursuant to paragraph 16 if
they are requested to do so by a contracting party the trade of which would be appreciably
affected by the measure in question.
Paragraphs 16, 18, 19 and 22
-
1. Is is understood that the CONTRACTING PARTIES may concur in a proposed measure subject
to specific conditions or limitations. If the measure as applied does not conform
to the terms of the concurrence it will to that extent be deemed a measure in which
the CONTRACTING PARTIES have not concurred. In cases in which the CONTRACTING PARTIES
have concurred in a measure for a specified period, the contracting party concerned,
if it finds that the maintenance of the measure for a further period of time is required
to achieve the objective for which the measure was originally taken, may apply to
the CONTRACTING PARTIES for an extension of that period in accordance with the provisions
and procedures of Section C or D, as the case may be.
-
2. It is expected that the CONTRACTING PARTIES will, as a rule, refrain from concurring
in a measure which is likely to cause serious prejudice to exports of a commodity
on which the economy of a contracting party is largely dependent.
Paragraphs 18 and 22
The phrase “that the interests of other contracting parties are adequately safeguarded”
is meant to provide latitude sufficient to permit consideration in each case of the
most appropriate method of safeguarding those interests. The appropriate method may,
for instance, take the form of an additional concession to be applied by the contracting
party having recourse to Section C or D during such time as the deviation from the
other Articles of the Agreement would remain in force or of the temporary suspension
by any other contracting party referred to in paragraph 18 of a concession substantially
equivalent to the impairment due to the introduction of the measure in question. Such
contracting party would have the right to safeguard its interests through such a temporary
suspension of a concession; Provided that this right will not be exercised when, in the case of a measure imposed by a
contracting party coming within the scope of paragraph 4 (a), the CONTRACTING PARTIES
have determined that the extent of the compensatory concession proposed was adequate.
Paragraph 19
The provisions of paragraph 19 are intented to cover the cases where an industry has
been in existence beyond the “reasonable period of time” referred to in the note to
paragraphs 13 and 14, and should not be so construed as to deprive a contracting party
coming within the scope of paragraph 4 (a) of Article XVIII, of its right to resort to the other provisions of Section C, including paragraph
17, with regard to a newly established industry even though it has benefited from
incidental protection afforded by balance of payments import restrictions.
Paragraph 21
Any measure taken pursuant to the provisions of paragraph 21 shall be withdrawn forthwith
if the action taken in accordance with paragraph 17 is withdrawn or if the CONTRACTING
PARTIES concur in the measure proposed after the expiration of the ninety-day time
limit specified in paragraph 17.
ad Article XX
Sub-paragraph (h)
The exception provided for in this sub-paragraph extends to any commodity agreement
which conforms to the principles approved by the Economic and Social Council in its
Resolution 30 (IV) of 28 March 1947.
ad Article XXIV
Paragraph 9
It is understood that the provisions of Article I would require that, when a product which has been imported into the territory of
a member of a customs union or free-trade area at a preferential rate of duty is re-exported
to the territory of another member of such union or area, the latter member should
collect a duty equal to the difference between the duty already paid and any higher
duty that would be payable if the product were being imported directly into its territory.
Paragraph 11
Measures adopted by India and Pakistan in order to carry out definitive trade arrangements
between them, once they have been agreed upon, might depart from particular provisions
of this Agreement, but these measures would in general be consistent with the objectives
of the Agreement.
[ad Article XXVI ]
ad Article XXVIII
The CONTRACTING PARTIES and each contracting party concerned should arrange to conduct
the negotiations and consultations with the greatest possible secrecy in order to
avoid premature disclosure of details of prospective tariff changes. The CONTRACTING
PARTIES shall be informed immediately of all changes in national tariffs resulting
from recourse to this Article.
Paragraph 1
-
1. If the CONTRACTING PARTIES specify a period other than a three-year period, a contracting
party may act pursuant to paragraph 1 or paragraph 3 of Article XXVIII on the first day following the expiration of such other period and, unless the CONTRACTING
PARTIES have again specified another period, subsequent periods will be three-year
periods following the expiration of such specified period.
-
2. The provision that on 1 January 1958, and on other days determined pursuant to paragraph
1, a contracting party “may .... modify or withdraw a concession” means that on such
day, and on the first day after the end of each period, the legal obligation of such
contracting party under Article II is altered; it does not mean that the changes in its customs tariff should necessarily
be made effective on that day. If a tariff change resulting from negotiations undertaken
pursuant to this Article is delayed, the entry into force of any compensatory concessions
may be similarly delayed.
-
3. Not earlier than six months, nor later than three months, prior to 1 January 1958,
or to the termination date of any subsequent period, a contracting party wishing to
modify or withdraw any concession embodied in the appropriate Schedule, should notify
the CONTRACTING PARTIES to this effect. The CONTRACTING PARTIES shall then determine
the contracting party or contracting parties with which the negotiations or consultations
referred to in paragraph 1 shall take place. Any contracting party so determined shall
participate in such negotiations or consultations with the applicant contracting party
with the aim of reaching agreement before the end of the period. Any extension of
the assured life of the Schedules shall relate to the Schedules as modified after
such negotiations, in accordance with paragraphs 1, 2 and 3 of Article XXVIII. If the CONTRACTING PARTIES are arranging for multilateral tariff negotiations to
take place within the period of six months before 1 January 1958, or before any other
day determined pursuant to paragraph 1, they shall include in the arrangements for
such negotiations suitable procedures for carrying out the negotiations referred to
in this paragraph.
-
4. The object of providing for the participation in the negotiations of any contracting
party with a principal supplying interest, in addition to any contracting party with
which the concession was initially negotiated, is to ensure that a contracting party
with a larger share in the trade affected by the concession than a contracting party
with which the concession was initially negotiated shall have an effective opportunity
to protect the contractual right which it enjoys under this Agreement. On the other
hand, it is not intended that the scope of the negotiations should be such as to make
negotiations and agreement under Article XXVIII unduly difficult nor to create complications in the application of this Article in
the future to concessions which result from negotiations thereunder. Accordingly,
the CONTRACTING PARTIES should only determine that a contracting party has a principal
supplying interest if that contracting party has had, over a reasonable period of
time prior to the negotiations, a larger share in the market of the applicant contracting
party than a contracting party with which the concession was initially negotiated
or would, in the judgment of the CONTRACTING PARTIES, have had such a share in the
absence of discriminatory quantitative restrictions maintained by the applicant contracting
party. It would therefore not be appropriate for the CONTRACTING PARTIES to determine
that more than one contracting party, or in those exceptional cases where there is
near equality more than two contracting parties, had a principal supplying interest.
-
5. Notwithstanding the definition of a principal supplying interest in note 4 to paragraph
1, the CONTRACTING PARTIES may exceptionally determine that a contracting party has
a principal supplying interest if the concession in question affects trade which constitutes
a major part of the total exports of such contracting party.
-
6. It is not intended that provision for participation in the negotiations of any contracting
party with a principal supplying interest, and for consultation with any contracting
party having a substantial interest in the concession which the applicant contracting
party is seeking to modify or withdraw, should have the effect that it should have
to pay compensation or suffer retaliation greater than the withdrawal or modification
sought, judged in the light of the conditions of trade at the time of the proposed
withdrawal or modification, making allowance for any discriminatory quantitative restrictions
maintained by the applicant contracting party.
-
7. The expression “substantial interest” is not capable of a precise definition and accordingly
may present difficulties for the CONTRACTING PARTIES. It is, however, intended to
be construed to cover only those contracting parties which have, or in the absence
of discriminatory quantitative restrictions affecting their exports could reasonably
be expected to have, a significant share in the market of the contracting party seeking
to modify or withdraw the concession.
Paragraph 4
-
1. Any request for authorization to enter into negotiations shall be accompanied by all
relevant statistical and other data. A decision on such request shall be made within
thirty days of its submission.
-
2. It is recognized that to permit certain contracting parties, depending in large measure
on a relatively small number of primary commodities and relying on the tariff as an
important aid for furthering diversification of their economies or as an important
source of revenue, normally to negotiate for the modification or withdrawal of concessions
only under paragraph 1 of Article XXVIII, might cause them at such a time to make modifications or withdrawals which in the
long run would prove unnecessary. To avoid such a situation the CONTRACTING PARTIES
shall authorize any such contracting party, under paragraph 4, to enter into negotiations
unless they consider this would result in, or contribute substantially towards, such
an increase in tariff levels as to threaten the stability of the Schedules to this
Agreement or lead to undue disturbance of international trade.
-
3. It is expected that negotiations authorized under paragraph 4 for modification or
withdrawal of a single item, or a very small group of items, could normally be brought
to a conclusion in sixty days. It is recognized, however, that such a period will
be inadequate for cases involving negotiations for the modification or withdrawal
of a larger number of items and in such cases, therefore, it would be appropriate
for the CONTRACTING PARTIES to prescribe a longer period.
-
4. The determination referred to in paragraph 4 (d) shall be made by the CONTRACTING
PARTIES within thirty days of the submission of the matter to them, unless the applicant
contracting party agrees to a longer period.
-
5. In determining under paragraph 4 (d) whether an applicant contracting party has unreasonably
failed to offer adequate compensation, it is understood that the CONTRACTING PARTIES
will take due account of the special position of a contracting party which has bound
a high proportion of its tariffs at very low rates of duty and to this extent has
less scope than other contracting parties to make compensatory adjustment.
ad Article XXVIII bis
Paragraph 3
It is understood that the reference to fiscal needs would include the revenue aspect
of duties and particularly duties imposed primarily for revenue purposes or duties
imposed on products which can be substituted for products subject to revenue duties
to prevent the avoidance of such duties.
ad Article XXIX
Paragraph 1
Chapters VII and VIII of the Havana Charter have been excluded from paragraph 1 because
they generally deal with the organization, functions and procedures of the International
Trade Organization.
[Final note ]
Ad PART IV
The words “developed contracting parties” and the words “less-developed contracting
parties” as used in Part IV are to be understood to refer to developed and less-developed countries which are
parties to the General Agreement on Tariffs and Trade.
Ad Article XXXVI
Paragraph 1
This Article is based upon the objectives set forth in Article I as it will be amended by Section A of paragraph 1 of the Protocol Amending Part I
and Articles XXIX and XXX when that Protocol enters into force.
Paragraph 4
The term “primary products” includes agricultural products, videparagraph 2 of the note ad Article XVI, Section B.
Paragraph 5
A diversification programme would generally include the intensification of activities
for the processing of primary products and the development of manufacturing industries,
taking into account the situation of the particular contracting party and the world
outlook for production and consumption of different commodities.
Paragraph 8
It is understood that the phrase “do not expect reciprocity” means, in accordance
with the objectives set forth in this Article, that the less-developed contracting
parties should not be expected, in the course of trade negotiations, to make contributions
which are inconsistent with their individual development, financial and trade needs,
taking into consideration past trade developments.
This paragraph would apply in the event of action under Section A of Article XVIII, Article XXVIII, Article XVIII bis (Article XXIX after the amendment set forth in Section A of paragraph
1 of the Protocol Amending Part I and Articles XXIX and XXX shall have become effective), Article XXXIII, or any other procedure under this Agreement.
Ad Article XXXVII
Paragraph 1(a)
This paragraph would apply in the event of negotiations for reduction or elimination
of tariffs or other restrictive regulations of commerce under Articles XXVIII, XXVIII bis (XXIX after the amendment set forth in Section A of paragraph 1 of the Protocol Amending
Part I and Articles XXIX and XXX shall have become effective), and Article XXXIII, as well as in connexion with other action to effect such reduction or elimination
which contracting parties may be able to undertake.
Paragraph 3(b)
The other measures referred to in this paragraph might include steps to promote domestic
structural changes, to encourage the consumption or particular products, or to introduce
measures of trade promotion.