Nov 1, 1988
ROLLBACK "UNDERSTANDINGS" SO FAR A DEAD LETTER.GENEVA, OCTOBER 28 IFDA/CHAKRAVARTHI RAGHAVAN)—Despite the commitments at Punta del Este, and the agreements and understandings in January 1987, there has been no rollback of GATT-illegal measures nor undertakings on a programme of rollback. This has been brought out at Thursday’s meeting of the Uruguay round Surveillance Body, chaired by the deputy director-general of GATT, Madan Mathur. At the meeting Brazil is reported to have tabled a revised proposal on rollback, to be agreed upon by ministers at Montreal at the mid-term review, and providing for consultations and undertakings on rollback in 1989. While the proposal is reported to have received wide support from third world countries, a number of industrial countries still appeared reluctant, despite the "flexibility" in dates and time-tables that the revised proposal suggested, according to participants. Brazil's earlier proposal tabled in june had suggested that those maintaining measures subject to rollback should make known their "offers" in august, consult and negotiate on them by October, and for the Montreal ministerial meeting to agree upon the phased rollback. At that time, several of the industrial countries took the position that it was too rigid a timetable. The revised proposals of Brazil have left all the dates and timings blank, but merely envisages that the process of requests for rollback, consultations, undertakings and offers on rollback to be done in 1989. With the Uruguay round scheduled to be completed by end of 1990, this would mean that the process of rollback would begin in 1989 and be completed before end of 1990. According to participants, Uruguay proposed that the Brazilian proposal should be suitably reflected in the report of the chairman to the Montreal meeting about the orientation of the future work of the surveillance body in the area of rollback. Brazil reportedly was agreeable to this, but some of the industrial countries reportedly had problems even with this approach. The Brazilian proposal and the report of the chairman are to be the subject of further informal consultations. At Punta del Este, participants committee themselves to rollback all trade-restrictive or distorting measures inconsistent with GATT or instruments negotiated within GATT framework. They undertook to phase out or bring into conformity with GATT, within an agreed time frame not later than date of formal completion of the Uruguay round, all such measures. The participants also agreed as a part of their commitment that "there shall be no GATT concessions requested fur the elimination of these measures". In January 1987, the trade negotiations committee in agreeing an a negotiating plan, provided for participants bringing to attention of the surveillance body measures that should be subject to rollback, and for consultations among the concerned parties to arrive at rollback undertakings. An "understanding", which was read out by the chairman of the TNC at that time, stipulated that participants maintaining measures subject to the rollback commitment "shall inform" the surveillance body by December 31, 1987 of rollback undertakings resulting from the first round of consultations. According to participants, a draft informal report circulated to the surveillance body by the chairman, which has drawn no any conclusions but provides what it describes as a factural survey, nevertheless brings out that the standstill and rollback commitments have not so far been observed. According to the draft, since September 1986, there had been 22 notifications relating to the standstill, 17 of them by the industrial countries themselves. Most of the notifications relate to actions of industrial countries, while three to that of third world countries. The report also brings out that the surveillance body has confined itself merely to examine relationship of measures notified and the commitment, and sending a record of its proceedings to the group of negotiations on goods and the trade negotiations committee. While in respect of same of the complaints, there have been same actions as a result of parallel actions before GATT bodies, no case has been listed of a standstill violation being remedied as a result of the actions of the surveillance body or of the trade negotiations committee. In the area of rollback, up to October 21, 1988 there were 18 requests for measures to be rolled back or brought into conformity with GATT. Eight of these requests came from third world countries and ten from industrialised countries. With one exception, all were addressed to the industrial countries, and with most of the requests relating to quantitative restrictions that the requesting country felt to be inconsistent with GATT articles XI and XIII. Consultations have been held or scheduled on most requests. Though a 30-day time limit was agreed upon to start process of consultations, the target was not met in many cases. And despite the understandings in January 1987, no undertakings have been made on rollback. The only offer on rollback was that of the EEC, which tabled some proposals, but subject to appropriate contributions, by other participants. A number of participants have however expressed serious concern about the discriminations contained in the EEC offer. And while some governments have taken some measures of liberalisation in respect of quantitative restrictions, these have not been in the context of rollback commitments either. The draft report would also appear to confess that the surveillance body has so far been unable to reach conclusions on whether measures notified to it were or were not a violation of the standstill. Similar difficulties had also been met in consultations over rollback requests. These difficulties, the draft report suggests, have arisen because of the argument that the standstill and rollback commitments were "political" and hence procedures for their implementation could not lead to "legally-binding conclusions". The draft also brings out the need to find a way forward, since only two years now remain for phasing out, or bringing into conformity with GATT, of measures subject to standstill and rollback. If the rollback commitment is to be implemented progressively, as envisaged at Punta del Este, a start on this has to be made without delay.