8:42 AM Dec 8, 1994


Geneva 8 Dec (Chakravarthi Raghavan) -- The Uruguay Round participating countries met formally at an Implementation Conference Thursday and formally set 1 January 1995 as the date for entry into force of the World Trade Organization as well as agreeing on arrangements for transitional co-existence of the WTO, GATT 1947 and the Tokyo Round codes and their committees.

The transition arrangements envisage co-existence for a year of the WTO, GATT 1947 and the Tokyo Round's anti-dumping and subsidies agreements, and specifying some of the conditions of such co-existence including in the area of dispute settlement.

GATT Director-General Peter Sutherland at a press conference declared this to be a "particular moment of historical significance", with 50 of the participating countries having already ratified or adopted enabling domestic legislations and about 100 expected to be on board by the start-up date.

"All things considered we are in a very favourable position today," Sutherland said, adding that even on the question of the constitution of the TMB "significant progress" was being made and he was hopeful of this issue being brought to a satisfactory conclusion and that the WTO would start off in the right atmosphere of issues being settled by consensus among countries and trade issues being conducted on the basis of objective criteria.

Beyond saying that it was everyone's hope that this issue would be resolved without rancour, Sutherland would not comment on the GATT CPs being able to decide, by consensus before the startup date, the candidate to head the WTO nor answer whether he would be there holding charge on an open-ended basis until a successor was found.

On China's joining the WTO, Sutherland stressed that it was important both for China, as the sixth largest trading nation, and the WTO as a 'world' organization, to have China as its member.

But this depended on agreement being reached and both sides showing reasonable accommodation to achieve this and a balance to be struck between the desirability of China's membership and the acceptability of the terms to be negotiated.

The setting of a 31 Dec. deadline by China (beyond which it would not negotiate further or improve its offers), Sutherland said, was an important expression of policy by China and it should be taken seriously. But reaching an agreement by that deadline would depend on flexibility on both sides.

"I can only hope that the negotiations proceed rapidly to a satisfactory conclusion and satisfactory to both sides," Sutherland said. "But I cannot speculate whether such an agreement can be reached."

Whether China would lose more by not being a member or the WTO would lose more by China not being a member would depend on the kind of agreement to be reached. "Both sides of this equation will lose by failure to reach reasonable accommodation. But both sides have to assist in reaching that accommodation," Sutherland said.

The transitional coexistence arrangements accepted by the implementation conference include provisions:

* for the WTO and GATT 1947 to coexist for a year, with the GATT 1947 and its instruments terminated at the end of that year, but subject to the CPs postponing the termination date by another year in the light of "unforeseen circumstances";

* despite the co-existence and the GATT 1947's MFN clause, the various concessions to be provided by WTO members (in terms of the agreements negotiated) will be accorded only to WTO members and not those who had not yet become one;

* the dispute settlement provisions in Art.XXIII of GATT 1947 would not apply against a WTO member, if the dispute is over a measure identified as one under Art 6 of the WTO's DSU;

* for seven months after entry into force of WTO, signatories to the Marrakesh Final Act who are GATT 1947 cps as of 7 December and eligible to be original members of the WTO could be present and speak at formal and informal meetings of the WTO bodies except the TMB, have access to all documents made available to WTO members, but not participate in any decision-making;

* the Tokyo Round agreement on anti-dumping (Art. VI) and the agreement on subsidies and countervailing duties (Art VI, XVI and XXIII) would terminate one year after the WTO's entry into force, but could be renewed for another year;

* but the dispute settlement provisions of the two codes would not apply to any Party to that agreement which is also a WTO member, where the measure is identified as a specific measure in the request for panel under the Art. 6 of the DSU;

* that if any signatory withdraws from either of the two agreements or the Tokyo Round agreement itself is terminated, its provisions would continue to apply to any anti-dumping or countervailing duty investigation or review not subject to the WTO agreement on anti-dumping or subsidies and countervailing measures;

* Parties withdrawing from either of the agreements would remain members of the particular committee solely for any dispute arising out of the countervailing duty investigations or review.