Topics handled by WTO committees and agreements
Issues covered by the WTO’s committees and agreements

STATE TRADING ENTERPRISES: REGULATION

Notification of state trading enterprises

Article XVII of the GATT 1994 contains (in its paragraph 4) the obligation, which applies to all WTO Members, to notify the products which are imported into or exported from their territories by state trading enterprises. The notifications are to be made in the form of a response to a questionnaire (revised most recently in April 1998). A copy of this questionnaire is circulated in an Annex to the request for notifications.

175pxls.gif (835 bytes)


Notification of state trading enterprises Back to top
What is the notification obligation?

Article XVII of the GATT 1994 contains (in its paragraph 4) the obligation, which applies to all WTO Members, to notify the products which are imported into or exported from their territories by state trading enterprises. The notifications are to be made in the form of a response to a questionnaire (revised most recently in April 1998). A copy of this questionnaire is circulated in an Annex to the request for notifications. The first request for such notifications under the WTO régime is found in document G/STR/N/1 dated 13 March 1995. The 1998 revised questionnaire will be the basis for the 1998 and subsequent year notifications.

In addition, the WTO Understanding on Article XVII elaborates on the notification requirement and reaffirms certain aspects of it:

- it provides a definition of the term "state trading enterprise" for the purpose of determining what kinds of enterprises must be notified;

- it states that all state trading enterprises are to be notified, whether or not imports or exports of the products they handle have taken place during the reporting period; and

- it reaffirms that each WTO Member – without exception – is to submit a notification. whether or not it maintains any state trading enterprises.

Which WTO members must notify? Back to top

All WTO Members, without exception, whether or not they have any state trading enterprises, must notify. Thus, if a Member has no state trading, it must submit a notification so indicating (i.e. a nil notification). Further, if a Member maintains a state trading enterprise, but that enterprise has not undertaken any imports or exports during the period covered, the Member must nevertheless notify by responding to the questionnaire.

What exactly is to be notified? Back to top

Any enterprise which fits the definition contained in paragraph 1 of the Understanding on Article XVII must be notified by responding to the revised questionnaire. The latter seeks the following information:

- Description of the products affected

- Reason or purpose for establishing/maintaining the STE

- Summary of the legal basis for the granting of the exclusive or special right or privilege to the STE

- Description of the functioning of the STE

- Statistical information on imports, exports and domestic production.

When, and how often, is the notification to be made?
Back to top

The notification obligation is annual and on the basis of a three-year cycle: in the first year of the cycle, what is called a "new and full" notification is to be made which provides the full picture of the Member's state trading activities. Such notifications should take the form of a full response to the revised questionnaire, except of course where the Member has no such enterprises to notify, in which case a nil notification should be made.

In each of the intervening two years, an updating notification is to be made which indicates any changes in the state trading picture since the previous year's notification. Here again, even where there are no changes to report, a notification must be made to this effect.

What happens to the notifications once they are made?
Back to top

The notifications are circulated to all WTO Members as unrestricted documents in the series "G/STR/N/--". Each notification comes before the Working Party individually for collective review by WTO Members. During these reviews, Members may pose questions to the notifying Member. Where a written question is submitted, a written response is required. All of the written questions and answers are circulated as WTO documents in the series "G/STR/Q1/--". Further, any Member may make a counter-notification where it feels that a notification by another Member is either incomplete or incorrect. While thus far no counter-notifications have been made, the substance of some of the written questions submitted could be considered as counter-notifications.