1. Singapore Issues with special reference to Trade Facilitation
Shashank Priya, Director, Trade Policy Division

2. Singapore Issues Trade and Investment Trade and Competition Policy
Transparency in Government Procurement
Trade Facilitation

3. Singapore Issues – The Genesis
EC and Japan wanted new issues on the WTO Agenda
To coincide with mandated negotiations
To balance losses in Agriculture and ATC
Singapore Ministerial in 1996
WTO considered an effective forum in view of strengthened Dispute Settlement process

4. Singapore Issues – The Genesis
Resistance by many members – incl. India
Compromise – decided to study the issues in depth
Especially w.r.t. interaction with trade
3 separate Working Groups formed
WG on Relationship between Trade & Investment
WG on the Interaction between Trade & Competition Policy
WG on Transparency in Government Procurement
Work Programme on Trade Facilitation in CTG

5. Doha Mandate on Singapore Issues
Decision at Doha was –
Recognizing the case for frameworks
Begin a clarification process on many elements in each of the issues
Negotiations to take place after the Fifth Ministerial
Based on a decision on modalities
Decision to be by explicit consensus
Chairman’s clarification
Members have the right to take a position to prevent this consensus and block negotiations

6. Trade & Investment – India’s position
Question the rationale for bringing investment into the WTO as it was overburdened and ill–equipped to handle investment
Question the need for a multilateral framework as it would not grant developing countries any certainty of additional FDI flows and the BITs were serving the requirements well with the needed flexibility
Trade and Investment has different effects and different treatment of these issues was required
Investment policies are closely linked to national development policies in which developing countries need policy space
Doha mandate is about a clarification process, not about negotiations and clarity has not been achieved

7. Trade &Competition - India’s Position
Competition Policy covers besides, trade policy, investment, industrial etc policies, and WTO may not be the forum for Competition policy as such
Countries are at different stages of development: Multilateral Competition Policy assumes convergence of economic and even political interests
Naturally, bilateral agreements are few and confined to developed countries or to RTAs
Efforts by some Members are to address governmental measures, while India is interested in ‘enterprise practices’ having cross border effects being addressed
Effectiveness of WTO provisions doubtful in the absence of readiness of Members like the US, EC, Japan etc. for information sharing and DSU.
‘Peer Review’ would work against developing countries in view of ‘asymmetry’ of market power of WTO Members

8. Transparency in GP - India’s Position
For India ‘transparency’ means gathering full information about a Members procurement regime - No new commitments for changing or modifying any aspect of its procurement system;
Regarding coverage, due to the federal structure of the government and the large number of entities involved it would be very difficult to provide detailed information on all levels of procurement;
Information on the Central Government procurements of goods (not services) above a particular threshold limit could be considered;
On other issues such as information on laws/ rules; procurement opportunities; information on procedures; time periods; etc. could be provided and was easily available already;
India has objected to any prescriptions on domestic review procedures; and
Questioned application of the DSU on this kind of an agreement.

9. Trade Facilitation - India’s Position
India had expressed its reservations regarding the need for multilateral rules on TF in WTO.
No need for an agreement for what are essentially trade procedures.
Other expert bodies like WCO dealing with similar issues.
Resource implications in terms of modernization, commitment for timely clearance of goods would be difficult for developing countries to meet.
Not clear how DSU would apply to a ‘Procedural Agreement’

10. Singapore Issues - Pre - Cancun
Initial draft text (Rev 1) reflected two diametrically opposite options
Proponents’ - launching negotiations based on modalities
Opponents’ - continuing the clarification process (No annexes)
We had co-sponsored a paper highlighting the elements which still lacked clarity
Draft text (Rev 2) released at Cancun framed it differently
Investment - Intensify clarification process; finalise modalities at a date linked to agriculture and NAMA
Competition – Continuation of the clarification process
Transparency in Government Procurement – commence negotiations
Trade Facilitation – commence negotiations

11. Singapore Issues - Pre- Cancun
Core Group on Singapore Issues
Just prior to Cancun, a Core Group of 16 countries (G-16, Bangladesh representing LDCs) was formed G-16 extremely effective at Cancun
Formed the core of developing country opposition
Articulated opposition to launch of negotiations when many elements were not yet clear
Highlighted lack of explicit consensus on modalities

12. Singapore Issues – At Cancun
Green Room Process
In the Green Room discussions, at one point, EC offered to drop Investment and Competition from the agenda.
Owing to further opposition, there was even a suggestion at one time that Transparency in Government Procurement too could be dropped
As no consensus could be reached, the Green Room process was called off and the Ministerial took no decision on Singapore Issues

13. Singapore Issues – Geneva Framework Agreement by GC (1st August 04)
Trade and Investment; Trade and Competition Policy and TGP will not form part of the work programme set out in Doha Declaration (in paras 20-22, and 26).
No work towards negotiations on any of these issues will take place within the WTO during the Doha Round.
On Trade Facilitation, explicit consensus to commence negotiations on the basis of modalities set out in Annex D.

14. What is Trade Facilitation
Systematic rationalization of procedures and documentation for international trade (UN ECE definition).
In WTO context, it means issues covered under GATT Articles V, VIII and X.
Would essentially cover subjects relating to importation and exportation: fees and charges; formalities; documentation; publication of laws; judicial and administrative tribunal; transit.

15. Why Trade Facilitation in WTO
Rule based
Strong dispute resolution
Open markets and smooth flow of international trade possible only if trade facilitative customs procedures in place.
Reduce transaction costs
Signify political commitment
Uniformity of efforts.

16. Background
Before Cancun Ministerial, a group of countries raised several issues on which clarification was needed.
Some important issues were:
Estimated costs for undertaking commitments?
What mechanism for compensating DCs for additional expenditure?
Nature of Special and Differential Treatment?
How to enhance effective cooperation between Customs authorities?
How to preserve development policy space?
Discussions on above issues continued during post-Cancun phase

17. Negotiation process
Intensive negotiation took place between 22nd to 31st July, 2004 in Geneva.
The Annex D modalities of GC Decision of 1st August, 2004 was a result of such negotiation and took on board most of the concerns of DCs.
A Core Group consisting of countries like India, Malaysia, Philippines, Jamaica, Egypt, Bangladesh, Indonesia, etc. highlighted the concerns of DCs regarding cost implication, technical assistance, S&DT provisions and customs cooperation mechanism.

18. Elements of Annex D
Negotiations to clarify and improve Articles V, VIII and X.
Negotiations to aim at enhancing technical assistance and support for CB.
Negotiations to aim at provisions for effective cooperation between customs authorities on TF and customs compliance issues.

19. Important S&DT provisions in AnnexD
S&DT should extend beyond granting of traditional transition periods for implementing commitments.
Extent and timing of entering into commitments shall be related to the implementation capacities of DCs.
DCs not obliged to undertake investments in infrastructure projects beyond their means.

20. Important S&DT provisions in Annex D
Members to identify TF needs and priorities of DCs.
Members to address concerns of DCs related to cost implications of proposed measures.
Support and assistance to be provided to DCs to implement commitments resulting from negotiations.

21. Important S&DT provisions in Annex D
Where implementation of commitments require support for infrastructure development, developed country members will make every effort to ensure such support
Where required support and assistance for infrastructure is not forthcoming and DCs continue to lack necessary capacity, implementation of commitment will not be required

22. Other elements of Annex D
A review of effectiveness of support and assistance provided.
Collaborative effort with other relevant international organizations for TA and CB (IMF, OECD, UNCTAD, WCO, WB).
Due account shall be taken of the relevant work of the WCO and other relevant international organizations.

23. GATT Article VIII
GATT Article VIII deals with fees and formalities connected with importation and exportation. Its important elements are:
All fees and charges (other than import and export duties) imposed in connection with importation and exportation shall be limited to the approximate cost of services rendered. It should not represent an indirect protection to domestic products or a taxation of imports or exports.
The number and diversity of fees for above purposes should be reduced.

24. GATT Article VIII (contd.)
There is a need to minimize the incidence and complexity of import/export formalities and to decrease and simplify import/export documentation requirements.
Substantial penalties should not be imposed for minor breaches of customs regulations or procedural requirements.

25. GATT Article VIII (contd.)
The provision of this Article shall extend to fees, charges, formalities and requirements imposed by government authorities in connection with importation and exportation.
Illustrative list of areas where this would be applicable: consular transactions, such as consular invoices and certificates; quantitative restrictions; licensing; exchange control; statistical services; documents, documentation and certification; analysis and inspection; quarantine, sanitation and fumigation.

26. GATT Article X
GATT Article X deals with publication and administration of trade regulations. It lays down:
Various laws, regulations, judicial decisions and administrative rulings relating to various customs related issues for clearance of goods (classification or valuation; rates of duties; requirements, restrictions or prohibitions on imports/exports) shall be published promptly by the contracting parties to enable governments and traders to become acquainted with them.

27. GATT Article X (contd.)
No increase in rate of duty or a more burdensome requirement, restriction or prohibition on imports shall be enforced before such measure has been officially published.
Each contracting party shall administer the laws of the above kind in a uniform, impartial and reasonable manner.

28. GATT Article X (contd.)
The contracting parties shall maintain judicial, arbitral or administrative tribunals for prompt review and correction of administrative action relating to customs matters.
Such tribunals shall be independent of the agencies entrusted with administrative enforcement.

29. GATT Article V GATT Article V deals with freedom of transit of goods.
The term “traffic in transit” implies movement of goods and means of transport (other than aircraft) across the territory of the country, where both the starting and the terminating point of the journey lies beyond it.
This article envisages that there should be freedom of transit via the routes most convenient for international transit.

30. GATT Article V (contd.)
No distinction shall be made on the basis of flag of vessels, the place of origin, departure, entry, exit or destination, ownership of goods or means of transport.
The charges imposed on traffic in transit shall be reasonable and will be on MFN basis.

31. Important Proposals Made
About 50 proposals made so far by countries like EC, US, Canada, Japan, Switzerland, China, Korea, Uganda, Rwanda, Paraguay, Mongolia, Argentina, etc. Compiled in TN/TF/W/43
Transparency
Publication of all border related laws, regulations, procedures and practices (Gazettes, Websites)
Time interval between publication of rules and entry into force
Prior consultation and commenting on new and amended rules
Information on policy objectives
Enquiry point/SNFP
Advance Ruling
Right of appeal/Release of goods in event of appeal
Maintenance of integrity amongst officials

32. Important Proposals Made (Contd.)
Simplification of fees
fees be relatable to service provided and not be ad valorem
Publication/Notification of fees/charges
Prohibition on collection of unpublicized fees
Periodic review of fees/charges
Automated payment
Reduction/minimization of the number and diversity of fees and charges

33. Important Proposals Made (Contd.)
Simplification of procedures and documentation
Risk management
Post clearance audit
Single Window/one time submission
Border agency coordination
Authorized trader system
Automation of customs
Acceptance of commercially available information and copies of documents
Use of international standards
Pre arrival clearance
Expedited procedures for express shipments
Separating Release from Clearance Procedures
Periodic Review of Formalities and Requirements

34. Important Proposals Made (Contd.)
Establishment and publication of average release and clearance times
Objective criteria for tariff classification
Transit
Fees and Charges
Publication of fees and charges and prohibition of unpublished ones
Periodic review of fees and charges

35. Important Proposals Made (Contd.)
Transit formalities and documentation requirements
Give choice of route to operators
Reduction/Simplification of procedures
Harmonization/Standardization
Promotion of regional transit arrangement
Simplified and preferential clearance for certain goods

36. Important Proposals Made (Contd.)
Whether transit of oil and gas through pipeline and electricity through grid could come under Article V (in addition to air, road, rail and boat)
Non-discrimination between individual carriers and types of consignments for transit procedures

37. India’s Participation
An active developing country participant
Participation is positive but also raising issues and points of concern
Presented a room document on TA/CB during June meeting of NGTF
Working on a paper on cooperation mechanism
Working on proposals under Article VIII and Article V on the basis of studies commissioned (MIDS, Ace Global through UNCTAD)

38. Thank You