DISCUSSIONS ON SURVEILLANCE MECHANISM TO RESUME.

Dec 2, 1986

DISCUSSIONS ON SURVEILLANCE MECHANISM TO RESUME.

GENEVA, NOVEMBER 28 (IFDA/CHAKRAVARTHI RAGHAVAN)— Informal consultations on the elements of an effective surveillance mechanism to oversee the standstill and rollback commitments of the Uruguay Round are to resume in GATT on December 3.

The Group of Negotiations on Goods (GNG), set up by the Punta del Este declaration to supervise the negotiations in goods is due to resumes its consideration of the issue informally, GATT sources said.

The GNG has to approve a negotiating plan by December 19, and has set itself a deadline of December 16, both for approving the plan and for "designating" the surveillance mechanism for the standstill and rollback commitments, as mandated by the Punta del Este declaration.

The TNC is also to meet on December 16, to receive a report from the GNG, and "decide on the appropriate mechanisms to carry out the surveillance, including periodic reviews and implementations".

Most of the participants appear to be agreed that both the approval of the negotiating plans and agreement on a surveillance mechanism and its designation must be done together.

In the current informal consultations within the GNG over the surveillance mechanism, there are apparently two or three informal papers floating around.

These are on the basis that while the GATT’s normal dispute settlement procedures would be there, Uruguay round participants must have quicker remedies.

The GATT dispute settlement procedures, of consultations followed by adjudication and adoption of panel reports and recommendations by the GATT council, is an extremely legalist approach and time-consuming.

Also, the only remedy at the end is one of authorising the aggrieved party to retaliate, and this is one, which would not lead third world countries anywhere.

Use of the half-yearly meetings of the special GATT Council, which was the mechanism created to oversee the standstill commitments of the 1982 Ministerial declaration, third world countries note has become puerile and diffuse, without any remedy or relief.

Hence the need to create an effective surveillance mechanism to secure relief, particularly the weaker trading partners, and to ensure that the violations do not destroy even the little credibility left now in GATT or the new round.

The real remedy during the course of the negotiations, they note, would be to put the violations under multilateral scrutiny and bring political peer pressure to bear on the offending participant.

This would help the government concerned to resist protectionist pressures from their legislative bodies or domestic enterprises.

However, for this process, there must be a body to "investigate" quickly the facts of any complaint of violation of standstill.

Any such violation should not be based on mere newspaper reports (as the GATT Secretariat often uses in its reports for the special Council meetings), but must be from governments, and based either on the notification of the country that has taken action or by cross-notification by any other government aggrieved.

The surveillance mechanism should then determine the facts and come to a conclusion on whether the actions do or do not violate the standstill commitment.

This investigation, some suggest, would necessarily have to be by a smaller body, and not the entire membership acting as the surveillance mechanism.

The parties directly involved should not be able to sit on them or block decisions by withholding consensus. There should hence be a clear provision for ultimate decision, if needed, by a vote, like the two-thirds vote provided in GATT for actions by GATT Contracting Parties acting jointly.

Once the factual determination is made by a smaller investigative body, then it should be discussed and considered by the wider body of the surveillance mechanism or GNG, which would then be able to apply political pressure on the offending party to end the violation.

Within such a framework, some of the third world countries seem willing to show some flexibility about the surveillance mechanism reporting to the TNC, but making the information available to the GNG.

Any real sanction of violation of the standstill, they say, is a political sanction of the violation’s impact on the negotiating process.

And while the TNC might thus be ultimately involved, the GNG too could not absolve itself of responsibility, it is argued.

This is because one of the mandated tasks of the GNG is to "coordinate the work of the negotiating groups and supervise the progress of the negotiations", and any major or persistent violation of the standstill would block the negotiating process and thus must be looked at by the GNG.

As regards rollback, this might need something like a GATT working party, to identify the measures to be rolled back, and agree on a progressive implementation of the rollback commitment within an agreed timeframe not later than date of formal completion of the negotiations.