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The Governments of the Commonwealth of Australia, the Kingdom
of Belgium, the United States of Brazil, Burma, Canada, Ceylon, the
Republic of Chile, the Republic of China, the Republic of Cuba, the
Czechoslovak Republic, the French Republic, India, Lebanon, the
Grand-Duchy of Luxemburg, the Kingdom of the Netherlands, New Zealand,
the Kingdom of Norway, Pakistan, Southern Rhodesia, Syria, the Union
of South Africa, the United Kingdom of Great Britain and Northern
Ireland, and the United States of America:
Recognizing that their relations in the field of trade and
economic endeavour should be conducted with a view to raising
standards of living, ensuring full employment and a large and steadily
growing volume of real income and effective demand, developing the
full use of the resources of the world and expanding the production
and exchange of goods,
Being desirous of contributing to these objectives by entering
into reciprocal and mutually advantageous arrangements directed to the
substantial reduction of tariffs and other barriers to trade and to
the elimination of discriminatory treatment in international commerce,
Have through their Representatives agreed as follows:
Part I
Article
I: General Most-Favoured-Nation Treatment
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1. With respect to customs duties and charges of any kind imposed on or
in connection with importation or exportation or imposed on the
international transfer of payments for imports or exports, and with
respect to the method of levying such duties and charges, and with
respect to all rules and formalities in connection with importation
and exportation, and with respect to all matters referred to in
paragraphs 2 and 4 of Article III,* any advantage, favour, privilege
or immunity granted by any contracting party to any product
originating in or destined for any other country shall be accorded
immediately and unconditionally to the like product originating in or
destined for the territories of all other contracting parties.
2. The provisions of paragraph 1 of this Article shall not require the
elimination of any preferences in respect of import duties or charges
which do not exceed the levels provided for in paragraph 4 of this
Article and which fall within the following descriptions:
(a) Preferences in force exclusively between two or more of the
territories listed in Annex A, subject to the conditions set forth
therein;
(b) Preferences in force exclusively between two or more territories which
on July 1, 1939, were connected by common sovereignty or relations of
protection or suzerainty and which are listed in Annexes B, C and D,
subject to the conditions set forth therein;
(c) Preferences in force exclusively between the United States of America
and the Republic of Cuba;
(d) Preferences in force exclusively between neighbouring countries listed
in Annexes E and F.
3. The provisions of paragraph 1 shall not apply to preferences between
the countries formerly a part of the Ottoman Empire and detached from
it on July 24, 1923, provided such preferences are approved under
paragraph 5(1), of Article XXV which shall be applied in this respect
in the light of paragraph 1 of Article XXIX.
4. The margin of preference* on any product in respect of which a
preference is permitted under paragraph 2 of this Article but is not
specifically set forth as a maximum margin of preference in the
appropriate Schedule annexed to this Agreement shall not exceed:
(a) in respect of duties or charges on any product described in such
Schedule, the difference between the most-favoured-nation and
preferential rates provided for therein; if no preferential rate is
provided for, the preferential rate shall for the purposes of this
paragraph be taken to be that in force on April 10, 1947, and, if no
most-favoured-nation rate is provided for, the margin shall not exceed
the difference between the most-favoured-nation and preferential rates
existing on April 10, 1947;
(b) in respect of duties or charges on any product not described in the
appropriate Schedule, the difference between the most-favoured-nation
and preferential rates existing on April 10, 1947.
In
the case of the contracting parties named in Annex G, the date of
April 10, 1947, referred to in subparagraph (a) and (b)
of this paragraph shall be replaced by the respective dates set forth
in that Annex.
Article II: Schedules
of Concessions back to top
1. (a) Each contracting party shall accord to the commerce of the other
contracting parties treatment no less favourable than that provided
for in the appropriate Part of the appropriate Schedule annexed to
this Agreement.
(b) The products described in Part I of the Schedule relating to any
contracting party, which are the products of territories of other
contracting parties, shall, on their importation into the territory to
which the Schedule relates, and subject to the terms, conditions or
qualifications set forth in that Schedule, be exempt from ordinary
customs duties in excess of those set forth and provided therein.
Such products shall also be exempt from all other duties or charges of
any kind imposed on or in connection with the importation in excess of
those imposed on the date of this Agreement or those directly and mandatorily required to be imposed thereafter by legislation in force
in the importing territory on that date.
(c) The products described in Part II of the Schedule relating to any
contracting party which are the products of territories entitled under
Article I to receive preferential treatment upon importation into the
territory to which the Schedule relates shall, on their importation
into such territory, and subject to the terms, conditions or
qualifications set forth in that Schedule, be exempt from ordinary
customs duties in excess of those set forth and provided for in Part
II of that Schedule. Such products shall also be exempt from all other
duties or charges of any kind imposed on or in connection with
importation in excess of those imposed on the date of this Agreement
or those directly or mandatorily required to be imposed thereafter by
legislation in force in the importing territory on that date. Nothing
in this Article shall prevent any contracting party from maintaining
its requirements existing on the date of this Agreement as to the
eligibility of goods for entry at preferential rates of duty.
2. Nothing in this Article shall prevent any contracting party from
imposing at any time on the importation of any product:
(a) a charge equivalent to an internal tax imposed consistently
with the provisions of paragraph 2 of Article III* in respect of the
like domestic product or in respect of an article from which the
imported product has been manufactured or produced in whole or in
part;
(b) any anti-dumping or countervailing duty applied consistently
with the provisions of Article VI;*
(c) fees or other charges commensurate with the cost of services
rendered.
3. No contracting party shall alter its method of determining
dutiable value or of converting currencies so as to impair the value
of any of the concessions provided for in the appropriate Schedule
annexed to this Agreement.
4. If any contracting party establishes, maintains or authorizes,
formally or in effect, a monopoly of the importation of any product
described in the appropriate Schedule annexed to this Agreement, such
monopoly shall not, except as provided for in that Schedule or as
otherwise agreed between the parties which initially negotiated the
concession, operate so as to afford protection on the average in
excess of the amount of protection provided for in that Schedule. The
provisions of this paragraph shall not limit the use by contracting
parties of any form of assistance to domestic producers permitted by
other provisions of this Agreement.*
5. If any contracting party considers that a product is not
receiving from another contracting party the treatment which the first
contracting party believes to have been contemplated by a concession
provided for in the appropriate Schedule annexed to this Agreement, it
shall bring the matter directly to the attention of the other
contracting party. If the latter agrees that the treatment
contemplated was that claimed by the first contracting party, but
declares that such treatment cannot be accorded because a court or
other proper authority has ruled to the effect that the product
involved cannot be classified under the tariff laws of such
contracting party so as to permit the treatment contemplated in this
Agreement, the two contracting parties, together with any other
contracting parties substantially interested, shall enter promptly
into further negotiations with a view to a compensatory adjustment of
the matter.
6. (a) The specific duties and charges included in the Schedules
relating to contracting parties members of the International Monetary
Fund, and margins of preference in specific duties and charges
maintained by such contracting parties, are expressed in the
appropriate currency at the par value accepted or provisionally
recognized by the Fund at the date of this Agreement. Accordingly, in
case this par value is reduced consistently with the Articles of
Agreement of the International Monetary Fund by more than twenty per
centum, such specific duties and charges and margins of preference may
be adjusted to take account of such reduction; provided that the CONTRACTING PARTIES (i.e.,
the contracting parties acting jointly as provided for in Article XXV)
concur that such adjustments will not impair the value of the
concessions provided for in the appropriate Schedule or elsewhere in
this Agreement, due account being taken of all factors which may
influence the need for, or urgency of, such adjustments.
(b) Similar provisions shall apply to any contracting party not a
member of the Fund, as from the date on which such contracting party
becomes a member of the Fund or enters into a special exchange
agreement in pursuance of Article XV.
7. The Schedules annexed to this Agreement are hereby made an
integral part of Part I of this Agreement.
Part II
Article III*: National Treatment on
Internal Taxation and Regulation back to top
1. The contracting parties recognize that internal taxes and other
internal charges, and laws, regulations and requirements affecting the
internal sale, offering for sale, purchase, transportation,
distribution or use of products, and internal quantitative regulations
requiring the mixture, processing or use of products in specified
amounts or proportions, should not be applied to imported or domestic
products so as to afford protection to domestic production.*
2. The products of the territory of any contracting party imported into
the territory of any other contracting party shall not be subject,
directly or indirectly, to internal taxes or other internal charges of
any kind in excess of those applied, directly or indirectly, to like
domestic products. Moreover, no contracting party shall otherwise
apply internal taxes or other internal charges to imported or domestic
products in a manner contrary to the principles set forth in paragraph 1.*
3. With respect to any existing internal tax which is inconsistent with
the provisions of paragraph 2, but which is specifically authorized
under a trade agreement, in force on April 10, 1947, in which the
import duty on the taxed product is bound against increase, the
contracting party imposing the tax shall be free to postpone the
application of the provisions of paragraph 2 to such tax until such
time as it can obtain release from the obligations of such trade
agreement in order to permit the increase of such duty to the extent
necessary to compensate for the elimination of the protective element
of the tax.
4. The products of the territory of any contracting party imported into
the territory of any other contracting party shall be accorded
treatment no less favourable than that accorded to like products of
national origin in respect of all laws, regulations and requirements
affecting their internal sale, offering for sale, purchase,
transportation, distribution or use. The provisions of this paragraph
shall not prevent the application of differential internal
transportation charges which are based exclusively on the economic
operation of the means of transport and not on the nationality of the
product.
5. No contracting party shall establish or maintain any internal
quantitative regulation relating to the mixture, processing or use of
products in specified amounts or proportions which requires, directly
or indirectly, that any specified amount or proportion of any product
which is the subject of the regulation must be supplied from domestic
sources. Moreover, no contracting party shall otherwise apply internal
quantitative regulations in a manner contrary to the principles set
forth in paragraph 1.*
6. The provisions of paragraph 5 shall not apply to any internal
quantitative regulation in force in the territory of any contracting
party on July 1, 1939, April 10, 1947, or March 24, 1948, at the
option of that contracting party; Provided that any such
regulation which is contrary to the provisions of paragraph 5 shall
not be modified to the detriment of imports and shall be treated as a
customs duty for the purpose of negotiation.
7. No internal quantitative regulation relating to the mixture,
processing or use of products in specified amounts or proportions
shall be applied in such a manner as to allocate any such amount or
proportion among external sources of supply.
8. (a) The provisions of this Article shall not apply to laws, regulations or
requirements governing the procurement by governmental agencies of
products purchased for governmental purposes and not with a view to
commercial resale or with a view to use in the production of goods for
commercial sale.
(b) The provisions of this Article shall not prevent the payment of
subsidies exclusively to domestic producers, including payments to
domestic producers derived from the proceeds of internal taxes or
charges applied consistently with the provisions of this Article and
subsidies effected through governmental purchases of domestic
products.
9. The contracting parties recognize that internal maximum price control
measures, even though conforming to the other provisions of this
Article, can have effects prejudicial to the interests of contracting
parties supplying imported products. Accordingly, contracting parties
applying such measures shall take account of the interests of
exporting contracting parties with a view to avoiding to the fullest
practicable extent such prejudicial effects.
10. The provisions of this Article shall not prevent any contracting party
from establishing or maintaining internal quantitative regulations
relating to exposed cinematograph films and meeting the requirements
of Article IV.
Article IV: Special
Provisions relating to Cinematograph Films back to top
If any contracting party establishes or maintains internal
quantitative regulations relating to exposed cinematograph films, such
regulations shall take the form of screen quotas which shall conform
to the following requirements:
(a) Screen quotas may require the exhibition of cinematograph films of
national origin during a specified minimum proportion of the total
screen time actually utilized, over a specified period of not less
than one year, in the commercial exhibition of all films of whatever
origin, and shall be computed on the basis of screen time per theatre
per year or the equivalent thereof;
(b) With the exception of screen time reserved for films of national
origin under a screen quota, screen time including that released by
administrative action from screen time reserved for films of national
origin, shall not be allocated formally or in effect among sources of
supply;
(c) Notwithstanding the provisions of subparagraph (b) of this Article,
any contracting party may maintain screen quotas conforming to the
requirements of subparagraph (a) of this Article which reserve a
minimum proportion of screen time for films of a specified origin
other than that of the contracting party imposing such screen quotas; Provided
that no such minimum proportion of screen time shall be increased
above the level in effect on April 10, 1947;
(d) Screen quotas shall be subject to negotiation for their limitation,
liberalization or elimination.
Article V: Freedom
of Transit back to top
1. Goods (including baggage), and also vessels and other means of
transport, shall be deemed to be in transit across the territory of a
contracting party when the passage across such territory, with or
without trans-shipment, warehousing, breaking bulk, or change in the
mode of transport, is only a portion of a complete journey beginning
and terminating beyond the frontier of the contracting party across
whose territory the traffic passes. Traffic of this nature is termed
in this article “traffic in transit”.
2. There shall be freedom of transit through the territory of each
contracting party, via the routes most convenient for international
transit, for traffic in transit to or from the territory of other
contracting parties. No distinction shall be made which is based on
the flag of vessels, the place of origin, departure, entry, exit or
destination, or on any circumstances relating to the ownership of
goods, of vessels or of other means of transport.
3. Any contracting party may require that traffic in transit through its
territory be entered at the proper custom house, but, except in cases
of failure to comply with applicable customs laws and regulations,
such traffic coming from or going to the territory of other
contracting parties shall not be subject to any unnecessary delays or
restrictions and shall be exempt from customs duties and from all
transit duties or other charges imposed in respect of transit, except
charges for transportation or those commensurate with administrative
expenses entailed by transit or with the cost of services rendered.
4. All charges and regulations imposed by contracting parties on traffic
in transit to or from the territories of other contracting parties
shall be reasonable, having regard to the conditions of the traffic.
5. With respect to all charges, regulations and formalities in connection
with transit, each contracting party shall accord to traffic in
transit to or from the territory of any other contracting party
treatment no less favourable than the treatment accorded to traffic in
transit to or from any third country.*
6. Each contracting party shall accord to products which have been in
transit through the territory of any other contracting party treatment
no less favourable than that which would have been accorded to such
products had they been transported from their place of origin to their
destination without going through the territory of such other
contracting party. Any contracting party shall, however, be free to
maintain its requirements of direct consignment existing on the date
of this Agreement, in respect of any goods in regard to which such
direct consignment is a requisite condition of eligibility for entry
of the goods at preferential rates of duty or has relation to the
contracting party’s prescribed method of valuation for duty
purposes.
7. The provisions of this Article shall not apply to the operation of
aircraft in transit, but shall apply to air transit of goods
(including baggage).
Article VI: Anti-dumping and Countervailing Duties
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1. The contracting parties recognize that dumping, by which products of
one country are introduced into the commerce of another country at
less than the normal value of the products, is to be condemned if it
causes or threatens material injury to an established industry in the
territory of a contracting party or materially retards the
establishment of a domestic industry. For the purposes of this
Article, a product is to be considered as being introduced into the
commerce of an importing country at less than its normal value, if the
price of the product exported from one country to another
(a) is less than the comparable price, in the ordinary course of trade,
for the like product when destined for consumption in the exporting
country, or,
(b) in the absence of such domestic price, is less than either
(i) the highest comparable price for the like product for export to any
third country in the ordinary course of trade, or
(ii) the cost of production of the product in the country of origin plus a
reasonable addition for selling cost and profit.
Due
allowance shall be made in each case for differences in conditions and
terms of sale, for differences in taxation, and for other differences
affecting price comparability.*
2. In order to offset or prevent dumping, a contracting party may levy on
any dumped product an anti-dumping duty not greater in amount than the
margin of dumping in respect of such product. For the purposes of this
Article, the margin of dumping is the price difference determined in
accordance with the provisions of paragraph 1.*
3. No countervailing duty shall be levied on any product of the territory
of any contracting party imported into the territory of another
contracting party in excess of an amount equal to the estimated bounty
or subsidy determined to have been granted, directly or indirectly, on
the manufacture, production or export of such product in the country
of origin or exportation, including any special subsidy to the
transportation of a particular product. The term “countervailing
duty” shall be understood to mean a special duty levied for the
purpose of offsetting any bounty or subsidy bestowed, directly, or
indirectly, upon the manufacture, production or export of any
merchandise.*
4. No product of the territory of any contracting party imported into the
territory of any other contracting party shall be subject to
anti-dumping or countervailing duty by reason of the exemption of such
product from duties or taxes borne by the like product when destined
for consumption in the country of origin or exportation, or by reason
of the refund of such duties or taxes.
5. No product of the territory of any contracting party imported into the
territory of any other contracting party shall be subject to both
anti-dumping and countervailing duties to compensate for the same
situation of dumping or export subsidization.
6. (a) No contracting party shall levy any anti-dumping or countervailing
duty on the importation of any product of the territory of another
contracting party unless it determines that the effect of the dumping
or subsidization, as the case may be, is such as to cause or threaten
material injury to an established domestic industry, or is such as to
retard materially the establishment of a domestic industry.
(b) The CONTRACTING PARTIES may waive the requirement of subparagraph (a)
of this paragraph so as to permit a contracting party to levy an
anti-dumping or countervailing duty on the importation of any product
for the purpose of offsetting dumping or subsidization which causes or
threatens material injury to an industry in the territory of another
contracting party exporting the product concerned to the territory of
the importing contracting party. The CONTRACTING PARTIES shall waive
the requirements of subparagraph (a) of this paragraph, so as to
permit the levying of a countervailing duty, in cases in which they
find that a subsidy is causing or threatening material injury to an
industry in the territory of another contracting party exporting the
product concerned to the territory of the importing contracting
party.*
(c) In exceptional circumstances, however, where delay might cause damage
which would be difficult to repair, a contracting party may levy a
countervailing duty for the purpose referred to in subparagraph (b) of
this paragraph without the prior approval of the CONTRACTING PARTIES; Provided
that such action shall be reported immediately to the CONTRACTING
PARTIES and that the countervailing duty shall be withdrawn promptly
if the CONTRACTING PARTIES disapprove.
7. A system for the stabilization of the domestic price or of the return
to domestic producers of a primary commodity, independently of the
movements of export prices, which results at times in the sale of the
commodity for export at a price lower than the comparable price
charged for the like commodity to buyers in the domestic market, shall
be presumed not to result in material injury within the meaning of
paragraph 6 if it is determined by consultation among the contracting
parties substantially interested in the commodity concerned that:
(a) the system has also resulted in the sale of the commodity for export
at a price higher than the comparable price charged for the like
commodity to buyers in the domestic market, and
(b) the system is so operated, either because of the effective regulation
of production, or otherwise, as not to stimulate exports unduly or
otherwise seriously prejudice the interests of other contracting
parties.
Article VII: Valuation
for Customs Purposes back to top
1. The contracting parties recognize the validity of the general
principles of valuation set forth in the following paragraphs of this
Article, and they undertake to give effect to such principles, in
respect of all products subject to duties or other charges* or
restrictions on importation and exportation based upon or regulated in
any manner by value. Moreover, they shall, upon a request by another
contracting party review the operation of any of their laws or
regulations relating to value for customs purposes in the light of
these principles. The CONTRACTING PARTIES may request from contracting
parties reports on steps taken by them in pursuance of the provisions
of this Article.
2. (a) The value for customs purposes of imported merchandise should be based
on the actual value of the imported merchandise on which duty is
assessed, or of like merchandise, and should not be based on the value
of merchandise of national origin or on arbitrary or fictitious
values.*
(b) “Actual value” should be the price at which, at a time and place
determined by the legislation of the country of importation, such or
like merchandise is sold or offered for sale in the ordinary course of
trade under fully competitive conditions. To the extent to which the
price of such or like merchandise is governed by the quantity in a
particular transaction, the price to be considered should uniformly be
related to either (i) comparable quantities, or (ii) quantities not
less favourable to importers than those in which the greater volume of
the merchandise is sold in the trade between the countries of
exportation and importation.*
(c) When the actual value is not ascertainable in accordance with
subparagraph (b) of this paragraph, the value for customs purposes
should be based on the nearest ascertainable equivalent of such
value.*
3. The value for customs purposes of any imported product should not
include the amount of any internal tax, applicable within the country
of origin or export, from which the imported product has been exempted
or has been or will be relieved by means of refund.
4. (a) Except as otherwise provided for in this paragraph, where it is
necessary for the purposes of paragraph 2 of this Article for a
contracting party to convert into its own currency a price expressed
in the currency of another country, the conversion rate of exchange to
be used shall be based, for each currency involved, on the par value
as established pursuant to the Articles of Agreement of the
International Monetary Fund or on the rate of exchange recognized by
the Fund, or on the par value established in accordance with a special
exchange agreement entered into pursuant to Article XV of this
Agreement.
(b) Where no such established par value and no such recognized rate of
exchange exist, the conversion rate shall reflect effectively the
current value of such currency in commercial transactions.
(c) The CONTRACTING PARTIES, in agreement with the International Monetary
Fund, shall formulate rules governing the conversion by contracting
parties of any foreign currency in respect of which multiple rates of
exchange are maintained consistently with the Articles of Agreement of
the International Monetary Fund. Any contracting party may apply such
rules in respect of such foreign currencies for the purposes of
paragraph 2 of this Article as an alternative to the use of par
values. Until such rules are adopted by the Contracting Parties, any
contracting party may employ, in respect of any such foreign currency,
rules of conversion for the purposes of paragraph 2 of this Article
which are designed to reflect effectively the value of such foreign
currency in commercial transactions.
(d) Nothing in this paragraph shall be construed to require any
contracting party to alter the method of converting currencies for
customs purposes which is applicable in its territory on the date of
this Agreement, if such alteration would have the effect of increasing
generally the amounts of duty payable.
5. The bases and methods for determining the value of products subject to
duties or other charges or restrictions based upon or regulated in any
manner by value should be stable and should be given sufficient
publicity to enable traders to estimate, with a reasonable degree of
certainty, the value for customs purposes.
Article VIII: Fees
and Formalities connected with Importation and Exportation* back to top
1. (a) All fees and charges of whatever character (other than import and
export duties and other than taxes within the purview of Article III)
imposed by contracting parties on or in connection with importation or
exportation shall be limited in amount to the approximate cost of
services rendered and shall not represent an indirect protection to
domestic products or a taxation of imports or exports for fiscal
purposes.
(b) The contracting parties recognize the need for reducing the number and
diversity of fees and charges referred to in subparagraph (a).
(c) The contracting parties also recognize the need for minimizing the
incidence and complexity of import and export formalities and for
decreasing and simplifying import and export documentation
requirements.*
2. A contracting party shall, upon request by another contracting party
or by the CONTRACTING PARTIES, review the operation of its laws and
regulations in the light of the provisions of this Article.
3. No contracting party shall impose substantial penalties for minor
breaches of customs regulations or procedural requirements. In
particular, no penalty in respect of any omission or mistake in
customs documentation which is easily rectifiable and obviously made
without fraudulent intent or gross negligence shall be greater than
necessary to serve merely as a warning.
4. The provisions of this Article shall extend to fees, charges,
formalities and requirements imposed by governmental authorities in
connection with importation and exportation, including those relating
to:
(a) consular transactions, such as consular invoices and
certificates;
(b) quantitative restrictions;
(c) licensing;
(d) exchange control;
(e) statistical services;
(f) documents, documentation and certification;
(g) analysis and inspection; and
(h) quarantine, sanitation and fumigation.
Article
IX: Marks of Origin back to top
1. Each contracting party shall accord to the products of the territories
of other contracting parties treatment with regard to marking
requirements no less favourable than the treatment accorded to like
products of any third country.
2. The contracting parties recognize that, in adopting and enforcing laws
and regulations relating to marks of origin, the difficulties and
inconveniences which such measures may cause to the commerce and
industry of exporting countries should be reduced to a minimum, due
regard being had to the necessity of protecting consumers against
fraudulent or misleading indications.
3. Whenever it is administratively practicable to do so, contracting
parties should permit required marks of origin to be affixed at the
time of importation.
4. The laws and regulations of contracting parties relating to the
marking of imported products shall be such as to permit compliance
without seriously damaging the products, or materially reducing their
value, or unreasonably increasing their cost.
5. As a general rule, no special duty or penalty should be imposed by any
contracting party for failure to comply with marking requirements
prior to importation unless corrective marking is unreasonably delayed
or deceptive marks have been affixed or the required marking has been
intentionally omitted.
6. The contracting parties shall co-operate with each other with a view
to preventing the use of trade names in such manner as to misrepresent
the true origin of a product, to the detriment of such distinctive
regional or geographical names of products of the territory of a
contracting party as are protected by its legislation. Each
contracting party shall accord full and sympathetic consideration to
such requests or representations as may be made by any other
contracting party regarding the application of the undertaking set
forth in the preceding sentence to names of products which have been
communicated to it by the other contracting party.
Article
X: Publication and Administration of Trade Regulations back to top
1. Laws, regulations, judicial decisions and administrative rulings of
general application, made effective by any contracting party,
pertaining to the classification or the valuation of products for
customs purposes, or to rates of duty, taxes or other charges, or to
requirements, restrictions or prohibitions on imports or exports or on
the transfer of payments therefor, or affecting their sale,
distribution, transportation, insurance, warehousing inspection,
exhibition, processing, mixing or other use, shall be published
promptly in such a manner as to enable governments and traders to
become acquainted with them. Agreements affecting international trade
policy which are in force between the government or a governmental
agency of any contracting party and the government or governmental
agency of any other contracting party shall also be published. The
provisions of this paragraph shall not require any contracting party
to disclose confidential information which would impede law
enforcement or otherwise be contrary to the public interest or would
prejudice the legitimate commercial interests of particular
enterprises, public or private.
2. No measure of general application taken by any contracting party
effecting an advance in a rate of duty or other charge on imports
under an established and uniform practice, or imposing a new or more
burdensome requirement, restriction or prohibition on imports, or on
the transfer of payments therefor, shall be enforced before such
measure has been officially published.
3. (a) Each contracting party shall administer in a uniform, impartial and
reasonable manner all its laws, regulations, decisions and rulings of
the kind described in paragraph 1 of this Article.
(b) Each contracting party shall maintain, or institute as soon as
practicable, judicial, arbitral or administrative tribunals or
procedures for the purpose, inter alia, of the prompt review
and correction of administrative action relating to customs matters.
Such tribunals or procedures shall be independent of the agencies
entrusted with administrative enforcement and their decisions shall be
implemented by, and shall govern the practice of, such agencies unless
an appeal is lodged with a court or tribunal of superior jurisdiction
within the time prescribed for appeals to be lodged by importers; Provided
that the central administration of such agency may take steps to
obtain a review of the matter in another proceeding if there is good
cause to believe that the decision is inconsistent with established
principles of law or the actual facts.
(c) The provisions of subparagraph (b) of this paragraph shall not require
the elimination or substitution of procedures in force in the
territory of a contracting party on the date of this Agreement which
in fact provide for an objective and impartial review of
administrative action even though such procedures are not fully or
formally independent of the agencies entrusted with administrative
enforcement. Any contracting party employing such procedures shall,
upon request, furnish the CONTRACTING PARTIES with full information
thereon in order that they may determine whether such procedures
conform to the requirements of this subparagraph.
Article
XI*: General Elimination of Quantitative Restrictions back to top
1. No prohibitions or restrictions other than duties, taxes or other
charges, whether made effective through quotas, import or export
licences or other measures, shall be instituted or maintained by any
contracting party on the importation of any product of the territory
of any other contracting party or on the exportation or sale for
export of any product destined for the territory of any other
contracting party.
2. The provisions of paragraph 1 of this Article shall not extend to the
following:
(a) Export prohibitions or restrictions temporarily applied to prevent or
relieve critical shortages of foodstuffs or other products essential
to the exporting contracting party;
(b) Import and export prohibitions or restrictions necessary to the
application of standards or regulations for the classification,
grading or marketing of commodities in international trade;
(c) Import restrictions on any agricultural or fisheries product, imported
in any form,* necessary to the enforcement of governmental measures
which operate:
(i) to restrict the quantities of the like domestic product permitted to
be marketed or produced, or, if there is no substantial domestic
production of the like product, of a domestic product for which the
imported product can be directly substituted; or
(ii) to remove a temporary surplus of the like domestic product, or, if
there is no substantial domestic production of the like product, of a
domestic product for which the imported product can be directly
substituted, by making the surplus available to certain groups of
domestic consumers free of charge or at prices below the current
market level; or
(iii) to restrict the quantities permitted to be produced of any animal
product the production of which is directly dependent, wholly or
mainly, on the imported commodity, if the domestic production of that
commodity is relatively negligible.
Any
contracting party applying restrictions on the importation of any
product pursuant to subparagraph (c) of this paragraph shall give
public notice of the total quantity or value of the product permitted
to be imported during a specified future period and of any change in
such quantity or value. Moreover, any restrictions applied under (i)
above shall not be such as will reduce the total of imports relative
to the total of domestic production, as compared with the proportion
which might reasonably be expected to rule between the two in the
absence of restrictions. In determining this proportion, the
contracting party shall pay due regard to the proportion prevailing
during a previous representative period and to any special factors*
which may have affected or may be affecting the trade in the product
concerned.
Article
XII*: Restrictions to Safeguard the Balance of Payments back to top
1. Notwithstanding the provisions of paragraph 1 of Article XI, any
contracting party, in order to safeguard its external financial
position and its balance of payments, may restrict the quantity or
value of merchandise permitted to be imported, subject to the
provisions of the following paragraphs of this Article.
2. (a) Import restrictions
instituted, maintained or intensified by a contracting party under
this Article shall not exceed those necessary:
(i) to forestall the imminent threat of, or to stop, a serious decline in
its monetary reserves; or
(ii) in the case of a contracting party with very low monetary reserves, to
achieve a reasonable rate of increase in its reserves.
Due
regard shall be paid in either case to any special factors which may
be affecting the reserves of such contracting party or its need for
reserves, including, where special external credits or other resources
are available to it, the need to provide for the appropriate use of
such credits or resources.
(b) Contracting parties applying restrictions under sub-paragraph (a) of
this paragraph shall progressively relax them as such conditions
improve, maintaining them only to the extent that the conditions
specified in that sub-paragraph still justify their application. They
shall eliminate the restrictions when conditions would no longer
justify their institution or maintenance under that subparagraph.
3. (a) Contracting parties undertake, in carrying out their domestic
policies, to pay due regard to the need for maintaining or restoring
equilibrium in their balance of payments on a sound and lasting basis
and to the desirability of avoiding an uneconomic employment of
productive resources. They recognize that, in order to achieve these
ends, it is desirable so far as possible to adopt measures which
expand rather than contract international trade.
(b) Contracting parties applying restrictions under this Article may
determine the incidence of the restrictions on imports of different
products or classes of products in such a way as to give priority to
the importation of those products which are more essential.
(c) Contracting parties applying restrictions under this Article
undertake:
(i) to avoid unnecessary damage to the commercial or economic interests of
any other contracting party;*
(ii) not to apply restrictions so as to prevent unreasonably the
importation of any description of goods in minimum commercial
quantities the exclusion of which would impair regular channels of
trade; and
(iii) not to apply restrictions which would prevent the importations of
commercial samples or prevent compliance with patent, trade mark,
copyright, or similar procedures.
(d) The contracting parties recognize that, as a result of domestic
policies directed towards the achievement and maintenance of full and
productive employment or towards the development of economic
resources, a contracting party may experience a high level of demand
for imports involving a threat to its monetary reserves of the sort
referred to in paragraph 2 (a) of this Article. Accordingly, a
contracting party otherwise complying with the provisions of this
Article shall not be required to withdraw or modify restrictions on
the ground that a change in those policies would render unnecessary
restrictions which it is applying under this Article.
4. (a) Any contracting party applying new restrictions or raising the general
level of its existing restrictions by a substantial intensification of
the measures applied under this Article shall immediately after
instituting or intensifying such restrictions (or, in circumstances in
which prior consultation is practicable, before doing so) consult with
the CONTRACTING PARTIES as to the nature of its balance of payments
difficulties, alternative corrective measures which may be available,
and the possible effect of the restrictions on the economies of other
contracting parties.
(b) On a date to be determined by them,* the CONTRACTING PARTIES shall
review all restrictions still applied under this Article on that date.
Beginning one year after that date, contracting parties applying
import restrictions under this Article shall enter into consultations
of the type provided for in subparagraph (a) of this paragraph with
the CONTRACTING PARTIES annually.
(c) (i) If, in the course of consultations with a contracting party under
subparagraph (a) or (b) above, the CONTRACTING PARTIES find that the
restrictions are not consistent with provisions of this Article or
with those of Article XIII (subject to the provisions of Article XIV),
they shall indicate the nature of the inconsistency and may advise
that the restrictions be suitably modified.
(ii) If, however, as a result of the consultations, the CONTRACTING PARTIES
determine that the restrictions are being applied in a manner
involving an inconsistency of a serious nature with the provisions of
this Article or with those of Article XIII (subject to the provisions
of Article XIV) and that damage to the trade of any contracting party
is caused or threatened thereby, they shall so inform the contracting
party applying the restrictions and shall make appropriate
recommendations for securing conformity with such provisions within
the specified period of time. If such contracting party does not
comply with these recommendations within the specified period, the
CONTRACTING PARTIES may release any contracting party the trade of
which is adversely affected by the restrictions from such obligations
under this Agreement towards the contracting party applying the
restrictions as they determine to be appropriate in the circumstances.
(d) The CONTRACTING PARTIES shall invite any contracting party which is
applying restrictions under this Article to enter into consultations
with them at the request of any contracting party which can establish
a prima facie case that the restrictions are inconsistent with
the provisions of this Article or with those of Article XIII (subject
to the provisions of Article XIV) and that its trade is adversely
affected thereby. However, no such invitation shall be issued unless
the CONTRACTING PARTIES have ascertained that direct discussions
between the contracting parties concerned have not been successful.
If, as a result of the consultations with the CONTRACTING PARTIES, no
agreement is reached and they determine that the restrictions are
being applied inconsistently with such provisions, and that damage to
the trade of the contracting party initiating the procedure is caused
or threatened thereby, they shall recommend the withdrawal or
modification of the restrictions. If the restrictions are not
withdrawn or modified within such time as the CONTRACTING PARTIES may
prescribe, they may release the contracting party initiating the
procedure from such obligations under this Agreement towards the
contracting party applying the restrictions as they determine to be
appropriate in the circumstances.
(e) In proceeding under this paragraph, the CONTRACTING PARTIES shall have
due regard to any special external factors adversely affecting the
export trade of the contracting party applying the restrictions.*
(f) Determinations under this paragraph shall be rendered expeditiously
and, if possible, within sixty days of the initiation of the
consultations.
5. If there is a persistent and widespread application of import
restrictions under this Article, indicating the existence of a general
disequilibrium which is restricting international trade, the
CONTRACTING PARTIES shall initiate discussions to consider whether
other measures might be taken, either by those contracting parties the
balance of payments of which are under pressure or by those the
balance of payments of which are tending to be exceptionally
favourable, or by any appropriate intergovernmental organization, to
remove the underlying causes of the disequilibrium. On the invitation
of the CONTRACTING PARTIES, contracting parties shall participate in
such discussions.
Article
XIII*: Non-discriminatory Administration of Quantitative
Restrictions back to top
1. No prohibition or restriction shall be applied by any contracting
party on the importation of any product of the territory of any other
contracting party or on the exportation of any product destined for
the territory of any other contracting party, unless the importation
of the like product of all third countries or the exportation of the
like product to all third countries is similarly prohibited or
restricted.
2. In applying import restrictions to any product, contracting parties
shall aim at a distribution of trade in such product approaching as
closely as possible the shares which the various contracting parties
might be expected to obtain in the absence of such restrictions and to
this end shall observe the following provisions:
(a) Wherever practicable, quotas representing the total amount of
permitted imports (whether allocated among supplying countries or not)
shall be fixed, and notice given of their amount in accordance with
paragraph 3 (b) of this Article;
(b) In cases in which quotas are not practicable, the restrictions may be
applied by means of import licences or permits without a quota;
(c) Contracting parties shall not, except for purposes of operating quotas
allocated in accordance with subparagraph (d) of this paragraph,
require that import licences or permits be utilized for the
importation of the product concerned from a particular country or
source;
(d) In cases in which a quota is allocated among supplying countries the
contracting party applying the restrictions may seek agreement with
respect to the allocation of shares in the quota with all other
contracting parties having a substantial interest in supplying the
product concerned. In cases in which this method is not reasonably
practicable, the contracting party concerned shall allot to
contracting parties having a substantial interest in supplying the
product shares based upon the proportions, supplied by such
contracting parties during a previous representative period, of the
total quantity or value of imports of the product, due account being
taken of any special factors which may have affected or may be
affecting the trade in the product. No conditions or formalities shall
be imposed which would prevent any contracting party from utilizing
fully the share of any such total quantity or value which has been
allotted to it, subject to importation being made within any
prescribed period to which the quota may relate.*
3. (a) In cases in which import licences are issued in connection with import
restrictions, the contracting party applying the restrictions shall
provide, upon the request of any contracting party having an interest
in the trade in the product concerned, all relevant information
concerning the administration of the restrictions, the import licences
granted over a recent period and the distribution of such licences
among supplying countries; Provided that there shall be no
obligation to supply information as to the names of importing or
supplying enterprises.
(b) In the case of import restrictions involving the fixing of quotas, the
contracting party applying the restrictions shall give public notice
of the total quantity or value of the product or products which will
be permitted to be imported during a specified future period and of
any change in such quantity or value. Any supplies of the product in
question which were en route at the time at which public notice
was given shall not be excluded from entry; Provided that they
may be counted so far as practicable, against the quantity permitted
to be imported in the period in question, and also, where necessary,
against the quantities permitted to be imported in the next following
period or periods; and Provided further that if any contracting
party customarily exempts from such restrictions products entered for
consumption or withdrawn from warehouse for consumption during a
period of thirty days after the day of such public notice, such
practice shall be considered full compliance with this subparagraph.
(c) In the case of quotas allocated among supplying countries, the
contracting party applying the restrictions shall promptly inform all
other contracting parties having an interest in supplying the product
concerned of the shares in the quota currently allocated, by quantity
or value, to the various supplying countries and shall give public
notice thereof.
4. With regard to restrictions applied in accordance with paragraph 2 (d)
of this Article or under paragraph 2 (c) of Article XI, the selection
of a representative period for any product and the appraisal of any
special factors* affecting the trade in the product shall be made
initially by the contracting party applying the restriction; Provided
that such contracting party shall, upon the request of any other
contracting party having a substantial interest in supplying that
product or upon the request of the CONTRACTING PARTIES, consult
promptly with the other contracting party or the CONTRACTING PARTIES
regarding the need for an adjustment of the proportion determined or
of the base period selected, or for the reappraisal of the special
factors involved, or for the elimination of conditions, formalities or
any other provisions established unilaterally relating to the
allocation of an adequate quota or its unrestricted utilization.
5. The provisions of this Article shall apply to any tariff quota
instituted or maintained by any contracting party, and, in so far as
applicable, the principles of this Article shall also extend to export
restrictions.
Article
XIV*: Exceptions to the Rule of Non-discrimination back to top
1. A contracting party which applies restrictions under Article XII or
under Section B of Article XVIII may, in the application of such
restrictions, deviate from the provisions of Article XIII in a
manner having equivalent effect to restrictions on payments and
transfers for current international transactions which that
contracting party may at that time apply under Article VIII or XIV of
the Articles of Agreement of the International Monetary Fund, or under
analogous provisions of a special exchange agreement entered into
pursuant to paragraph 6 of Article XV.*
2. A contracting party which is applying import restrictions under
Article XII or under Section B of Article XVIII may, with the consent
of the CONTRACTING PARTIES, temporarily deviate from the provisions of
Article XIII in respect of a small part of its external trade where
the benefits to the contracting party or contracting parties concerned
substantially outweigh any injury which may result to the trade of
other contracting parties.*
3. The provisions of Article XIII shall not preclude a group of
territories having a common quota in the International Monetary Fund
from applying against imports from other countries, but not among
themselves, restrictions in accordance with the provisions of Article
XII or of Section B of Article XVIII on condition that such
restrictions are in all other respects consistent with the provisions
of Article XIII.
4. A contracting party applying import restrictions under Article XII or
under Section B of Article XVIII shall not be precluded by Articles XI
to XV or Section B of Article XVIII of this Agreement from applying
measures to direct its exports in such a manner as to increase its
earnings of currencies which it can use without deviation from the
provisions of Article XIII.
5. A contracting party shall not be precluded by Articles XI to XV,
inclusive, or by Section B of Article XVIII, of this Agreement
from applying quantitative restrictions:
(a) having equivalent effect to exchange restrictions authorized under
Section 3 (b) of Article VII of the Articles of Agreement of the
International Monetary Fund, or
(b) under the preferential arrangements provided for in Annex A of this
Agreement, pending the outcome of the negotiations referred to
therein.
Article
XV: Exchange Arrangements back to top
1. The CONTRACTING PARTIES shall seek co-operation with the International
Monetary Fund to the end that the CONTRACTING PARTIES and the Fund may
pursue a co-ordinated policy with regard to exchange questions within
the jurisdiction of the Fund and questions of quantitative
restrictions and other trade measures within the jurisdiction of the
CONTRACTING PARTIES.
2. In all cases in which the CONTRACTING PARTIES are called upon to
consider or deal with problems concerning monetary reserves, balances
of payments or foreign exchange arrangements, they shall consult fully
with the International Monetary Fund. In such consultations, the
CONTRACTING PARTIES shall accept all findings of statistical and other
facts presented by the Fund relating to foreign exchange, monetary
reserves and balances of payments, and shall accept the determination
of the Fund as to whether action by a contracting party in exchange
matters is in accordance with the Articles of Agreement of the
International Monetary Fund, or with the terms of a special exchange
agreement between that contracting party and the CONTRACTING PARTIES.
The CONTRACTING PARTIES in reaching their final decision in cases
involving the criteria set forth in paragraph 2 (a) of Article XII or
in paragraph 9 of Article XVIII, shall accept the determination of the
Fund as to what constitutes a serious decline in the contracting
party’s monetary reserves, a very low level of its monetary reserves
or a reasonable rate of increase in its monetary reserves, and as to
the financial aspects of other matters covered in consultation in such
cases.
3. The CONTRACTING PARTIES shall seek agreement with the Fund regarding
procedures for consultation under paragraph 2 of this Article.
4. Contracting parties shall not, by exchange action, frustrate* the
intent of the provisions of this Agreement, nor, by trade action, the
intent of the provisions of the Articles of Agreement of the
International Monetary Fund.
5. If the CONTRACTING PARTIES consider, at any time, that exchange
restrictions on payments and transfers in connection with imports are
being applied by a contracting party in a manner inconsistent with the
exceptions provided for in this Agreement for quantitative
restrictions, they shall report thereon to the Fund.
6. Any contracting party which is not a member of the Fund shall, within
a time to be determined by the CONTRACTING PARTIES after consultation
with the Fund, become a member of the Fund, or, failing that, enter
into a special exchange agreement with the CONTRACTING PARTIES. A
contracting party which ceases to be a member of the Fund shall
forthwith enter into a special exchange agreement with the CONTRACTING
PARTIES. Any special exchange agreement entered into by a contracting
party under this paragraph shall thereupon become part of its
obligations under this Agreement.
7. (a) A special exchange agreement between a contracting party and the
CONTRACTING PARTIES under paragraph 6 of this Article shall provide to
the satisfaction of the CONTRACTING PARTIES that the objectives of
this Agreement will not be frustrated as a result of action in
exchange matters by the contracting party in question.
(b) The terms of any such agreement shall not impose obligations on the
contracting party in exchange matters generally more restrictive than
those imposed by the Articles of Agreement of the International
Monetary Fund on members of the Fund.
8. A contracting party which is not a member of the Fund shall furnish
such information within the general scope of section 5 of Article VIII
of the Articles of Agreement of the International Monetary Fund as the
CONTRACTING PARTIES may require in order to carry out their functions
under this Agreement.
9. Nothing in this Agreement shall preclude:
(a) the use by a contracting party of exchange controls or exchange
restrictions in accordance with the Articles of Agreement of the
International Monetary Fund or with that contracting party’s special
exchange agreement with the CONTRACTING PARTIES, or
(b) the use by a contracting party of restrictions or controls in imports
or exports, the sole effect of which, additional to the effects
permitted under Articles XI, XII, XIII and XIV, is to make effective
such exchange controls or exchange restrictions.
Article
XVI*: Subsidies back to top
Section
A — Subsidies in General
1. If any contracting party grants or maintains any subsidy, including
any form of income or price support, which operates directly or
indirectly to increase exports of any product from, or to reduce
imports of any product into, its territory, it shall notify the
CONTRACTING PARTIES in writing of the extent and nature of the
subsidization, of the estimated effect of the subsidization on the
quantity of the affected product or products imported into or exported
from its territory and of the circumstances making the subsidization
necessary. In any case in which it is determined that serious
prejudice to the interests of any other contracting party is caused or
threatened by any such subsidization, the contracting party granting
the subsidy shall, upon request, discuss with the other contracting
party or parties concerned, or with the CONTRACTING PARTIES, the
possibility of limiting the subsidization.
Section
B — Additional Provisions on Export Subsidies*
2. The contracting parties recognize that the granting by a contracting
party of a subsidy on the export of any product may have harmful
effects for other contracting parties, both importing and exporting,
may cause undue disturbance to their normal commercial interests, and
may hinder the achievement of the objectives of this Agreement.
3. Accordingly, contracting parties should seek to avoid the use of
subsidies on the export of primary products. If, however, a
contracting party grants directly or indirectly any form of subsidy
which operates to increase the export of any primary product from its
territory, such subsidy shall not be applied in a manner which results
in that contracting party having more than an equitable share of world
export trade in that product, account being taken of the shares of the
contracting parties in such trade in the product during a previous
representative period, and any special factors which may have affected
or may be affecting such trade in the product.*
4. Further, as from 1 January 1958 or the earliest practicable date
thereafter, contracting parties shall cease to grant either directly
or indirectly any form of subsidy on the export of any product other
than a primary product which subsidy results in the sale of such
product for export at a price lower than the comparable price charged
for the like product to buyers in the domestic market. Until 31
December 1957 no contracting party shall extend the scope of any such
subsidization beyond that existing on 1 January 1955 by the
introduction of new, or the extension of existing, subsidies.*
5. The CONTRACTING PARTIES shall review the operation of the provisions
of this Article from time to time with a view to examining its
effectiveness, in the light of actual experience, in promoting the
objectives of this Agreement and avoiding subsidization seriously
prejudicial to the trade or interests of contracting parties.
Article XVII: State Trading Enterprises back to top
1.* (a) Each contracting party undertakes that if it establishes or
maintains a State enterprise, wherever located, or grants to any
enterprise, formally or in effect, exclusive or special privileges,*
such enterprise shall, in its purchases or sales involving either
imports or exports, act in a manner consistent with the general
principles of non-discriminatory treatment prescribed in this
Agreement for governmental measures affecting imports or exports by
private traders.
(b) The provisions of subparagraph (a) of this paragraph shall be understood to require that such enterprises
shall, having due regard to the other provisions of this Agreement,
make any such purchases or sales solely in accordance with commercial
considerations,* including price, quality, availability,
marketability, transportation and other conditions of purchase or
sale, and shall afford the enterprises of the other contracting
parties adequate opportunity, in accordance with customary business
practice, to compete for participation in such purchases or sales.
(c) No contracting party shall prevent any enterprise (whether or
not an enterprise described in subparagraph (a)
of this paragraph) under its jurisdiction from acting in accordance
with the principles of subparagraphs (a)
and (b) of this paragraph.
2. The provisions of paragraph 1 of this Article shall not apply
to imports of products for immediate or ultimate consumption in
governmental use and not otherwise for resale or use in the production
of goods* for sale. With
respect to such imports, each contracting party shall accord to the
trade of the other contracting parties fair and equitable treatment.
3. The contracting parties recognize that enterprises of the kind
described in paragraph 1 (a)
of this Article might be operated so as to create serious obstacles to
trade; thus negotiations on a reciprocal and mutually advantageous
basis designed to limit or reduce such obstacles are of importance to
the expansion of international trade.*
4. (a) Contracting parties shall notify the CONTRACTING PARTIES of the
products which are imported into or exported from their territories by
enterprises of the kind described in paragraph 1 (a)
of this Article.
(b) A contracting party establishing, maintaining or authorizing an
import monopoly of a product, which is not the subject of a concession
under Article II, shall, on the request of another contracting party
having a substantial trade in the product concerned, inform the
CONTRACTING PARTIES of the import mark-up* on the product during a
recent representative period, or, when it is not possible to do so, of
the price charged on the resale of the product.
(c) The CONTRACTING PARTIES may, at the request of a contracting
party which has reason to believe that its interest under this
Agreement are being adversely affected by the operations of an
enterprise of the kind described in paragraph 1 (a),
request the contracting party establishing, maintaining or authorizing
such enterprise to supply information about its operations related to
the carrying out of the provisions of this Agreement.
(d) The provisions of this paragraph shall not require any
contracting party to disclose confidential information which would
impede law enforcement or otherwise be contrary to the public interest
or would prejudice the legitimate commercial interests of particular
enterprises.
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